Change in mindset needed to grow small businesses
A SHIFT in mindset will prove crucial for enterprises to achieve their full potential.
For shipping magnate Doris Magsaysay Ho, veering away from a mindset geared toward making excuses and finding faults in the current situation will enable more Filipinos and local enterprises to tap the significant benefits that an integrated economy can bring.
Ho is particularly encouraging micro, small and medium sized enterprises (MSMEs), which account for more than 99 percent of the country’s registered businesses, to rise up to the challenge, go beyond the hurdles and continue to innovate to find potential solutions despite fact that many of the challenges they face are mostly external in nature. These included lack of financing, market access, and adequate infrastructure, as well as other “natural barriers” imposed by cumbersome, complicated procedures and rules.
“It is convenient, after all, to make an excuse and blame someone else for one’s inability to hurdle through difficulties. But there is just that need to start with our minds. Our intent, will and determination could spell all the difference in the success of one’s business,” said Ho, who is currently the chair of the Asia-Pacific Economic Cooperation Business Advisory Council (Abac).
“The point is, we have to start with our minds. I believe Filipinos are amazing—we have all the skills, and the ‘can do’ attitude. We shouldn’t be discouraged with, for instance, the lack of infrastructure. We should jump over that wall,” Ho explained in an interview on the sidelines of the Apec meetings in Cebu.
Currently MSMEs account for about 99 percent of registered enterprises in the Philippines and two thirds of employment, but only a third of the value of the country’s gross domestic product (GDP).
Seeing this potential of MSMEs as possible economic growth drivers, the Philippines, as chair of the Apec meetings this year, has decided to put a special emphasis on the MSME agenda—a move that saw, in recent meetings, the endorsement of position papers and recommendations, all championing the cause of these small companies.
And while the Apec meetings have yet to conclude, the Philippine government, through the Department of Trade and Industry, has already sprung into action, implementing concrete measures that are expected to help boost the bottom line of MSMEs.
Challenges
Being involved in a company that has interests in shipping, logistics, human resources, marine travel and tourism, Ho knew all too well the various challenges that many Philippine companies face amid an increasingly integrated regional and global markets. Many of these are largely external in nature. One of these challenges is the lack of infrastructure, which is felt not only in the Philippines, but in other Apec economies as well.
“We talked in our (Abac) report and recommendations about the opportunities that are out there and one key factor [to tap these] is, needless to say, availability of infrastructure. If you can’t to get to work, if you can’t get to the airport or to the port, or if we’re slowed down by too much traffic, we lose so much productivity. And it is in this area that a collaborative effort between the business community and the government will be extremely important,” Ho explained.
“I think the challenge for businesses today is to be able to work together with the government to put out key infrastructure projects. We must ensure that companies and the potential expansion of businesses are not held back because of the lack of infrastructure,” she added.
Ho cited the case of the country’s ports, pointing out that it was not just Manila that was suffering from a congestion. The port in Cebu, she said, is “already full and puts a constraint [on businesses] to be truly efficient.”
Opening markets
Fortunately, governments across the 21 member economies of Apec are fully aware of these challenges, and have been actively pushing for new initiatives that could further open up markets for small enterprises and ease the integration of MSMEs in the international trade and global value chains. The Philippines, for one, has since been enacting policies and laws meant to boost the competitiveness of MSMEs.
“Apec is about opening markets and it becomes relevant to MSMEs only if you really have a very clear idea of how to be competitive, while at the same time ensuring that our products and services are of high standards,” Ho said.
“With convergence happening now, we have to be very aggressive in selling our products and services to other markets,” she further said.
Abac, for its part, remained one with the Apec economies in pushing for inclusive growth as it continues to push for policies relevant to the needs of small businesses. Abac will similarly put forward the MSME agenda at the upcoming SME summit, which will be held in November.
“The world has become truly competitive and as chair of Abac, my goal is to make all this work in Apec as relevant to small businesses as possible. The world is falling apart economically and if we can broaden the base with more and more people sharing the production and the benefits of that wealth, maybe it won’t become so vulnerable to change,” Ho said.
“We believe that the greatest opportunity for any economy is to make more people at the bottom of the pyramid to be part of global trade and services. In that way, you create a much stronger base of many people creating wealth and not just in the hands of the few,” she concluded.
