In the first part of these blogs An SME Is Not A Small Version Of A Large Company Part 1 we looked at many of the differences between and SME and a large business. Now, in An SME Is Not A Small Version Of A Large Company Part 2 we need to consider why this matters, both to SME’s and the UK economy in general.
First, let us consider the quality of advice SME’s get. In a previous blog How To Ensure Your Consultant Is Effective I spent time considering why too many consultants get a bad name and came to the overall conclusion that what businesses need is practical advice based on experience. This is even more true for SME’s than for large companies. When I am talking with SME’s one of the valid criticisms that they make is that too many examples come from large businesses and whilst I try very hard not to do this I must plead a little bit guilty. Examples of how Apple or Google or Amazon do things and have been successful are of passing interest to them. What they need are examples and recommendations that specifically relate to SME’s. They also want advisers to stop assuming that all SME’s want to become big. For every Gymshark (back bedroom to multi million pound empire) out there we have tens of thousands of successful SME’s that never will, and mostly never want to be Unicorn companies. The government constantly goes on about growth rather than effectiveness and much of the advice that SME’s get is in the same vein.
What we need are centres of specialist advice for SME’s. I work regularly with the SME group at WMG and that is set up specifically to give help and advice to SME’s in the practical no nonsense way that they need. Very different to the type of thing they will get from the big consultancy and advisory firms.
The government has made the business environment so complex that accountancy, legal and technical firms that specialised in SME’s are becoming rarer. It’s just become too difficult to be on top of all the legislation and so small scale advisers are putting themselves at risk of missing something and being sued as a result. Government funded advisors are heavily weighted in favour of retired people from large businesses, many of whom have never worked in or run / owned SME’s. It’s very attractive when you leave you executive job in Big Business PLC to “do a bit of consultancy”.
Government is very keen to state how much assistance they are giving in the form of funded programmes to SME’s and it is true there is a lot out there. The problem is, that for SME’s it’s all too complicated. If you are a large company you can have staff dedicated to searching out grants etc and writing proposals. Many SME’s will only hear about something via someone they happen to know and then an inexperienced person in their organisation will be writing a grant proposal late at night on top of their normal day job. We need to find an effective way of getting information on the availability of funds and projects to SME’s and make the whole application process easier. It would be fantastic if Government funded all or part of an information dissemination service and helped with proposal writing. The problem is that funding assistance with paperwork is not as “sexy” and high profile as saying they have put £x million electric vehicles or robotics. These areas need funding but so do the vitally important “drains jobs” of discovery, application and profitably implementing change.
To really assist SME’s they need help with many of the things that large companies take for granted. Assistance with complying with legislation, help with funding applications, funding of advisors with specific SME experience (I declare my vested interest here), assistance with reshoring and so on. Low profile for government but highly effective for SME’s and UK plc.
The opportunity is huge but will not work until it is realised, especially by government, that an SME is not a small version of a large company especially when it comes to resources.
In the next blog we will consider why SME’s are so important in an economy that wants to move forward in an effective way.
If you want to receive our weekly newsletter, please Subscribe