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Creation of Enterprises
through Formation of Entrepreneurs (CEFE)
Basic
Guidelines for successful CEFE interventions
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Design
There are two main CEFE product groups, courses aimed at existing or
potential entrepreneurs, and courses for personnel from enterprise support
or regulatory agencies. Both products have the objective of improving the
business performance of entrepreneurs. One is more direct while the other is
more indirect working on the enabling environment rather than entrepreneurs
themselves. Both are considered to be valuable in the design of any CEFE
programme. The four primary considerations made during the design phase are:
the preparation for the Appreciation Workshop for Enterprise Support
Personnel; the conducting of a needs assessment on the target group; the
screening of participants and the structuring of institutional resources to
support participants with post-course follow-up.
The
Appreciation Workshop
The
course for the staff of enterprise support or regulatory agencies, or the
Appreciation Workshop is usually the first of the products to be delivered
in a new environment which has had little prior exposure to CEFE. There are
several immediate objectives to this course: to develop an appreciation by
participants of the enterprise development process and to draw attention to
the role that the participants can play in this process; to identify and
possibly influence the cultural norms associated with enterprising
behaviour; to induce the emergence of embryonic enterprising behaviour; to
explore complementary relationships between institutions that may assist the
entrepreneur in start-up or growth; and to determine the scope of assistance
open to the various target groups in that particular micro climate.
The
needs assessment
During
the design phase a choice has to be made concerning the specific target
group to be addressed. The segments may break down as follows for existing
or start-up businesses by: sex, age, ethnic group, education background,
enterprise sector,
location, size, ownership structure, technology, raw
materials, former occupation or any other variables that are considered to
be important to that particular application of CEFE. Prior to the conducting
of any course for entrepreneurs a needs assessment of the target group
should be conducted which takes into consideration: cultural stereotypes
associated with enterprising behaviour and the running of a business, this
may evoke the adaptation of training materials or methods to be more
sensitive to these issues; an assessment of the target group's resource
endowments such as experience, education, natural resources, institutional
resources such as finance, counselling or technology; and a rapid assessment
of the potential opportunities to assist in the preparation of more
appropriate content and methods for this part of the course. The result of
the needs assessment is a modified course and more sensitised trainers
capable of providing more informed guidance of the entrepreneur's micro
climate throughout the course.
Screening
candidates
The
third factor at this stage is the selection or screening of potential
participants. Most people have the ability to start or run a business. Those
who have a higher degree of competence, a good knowledge of their micro
climate, resources, motivation, cultural and environmental support are more
likely to succeed. There is no set winning formula for the "right"
combination of these attributes in an applicant. An issue that is frequently
debated with respect to selection is "if an applicant scores very
highly during selection, they would probably make it anyway without the
support of the course, so where is the value-added or additionality?",
on the other hand selecting people with no knowledge of their micro climate,
low motivation, poor skills, no access to resources and operate in an
inhospitable culture and macro economic situation will probably have little
impact on anything. Most frequently CEFE courses are arranged for the less
advantaged target groups, and in such situations it makes sense to make some
attempt to pick participants on the basis of their potential impact on the
economy in question and possible the demonstration effect they will have on
the culture of the rest of the target group. If time permits, the costs of
selection can be reduced to a minimum by extending the selection process
time to one month during which time applicants are give specific tasks
related enterprise growth. The quality with which the tasks are performed
provides indicators that are the best measure of a candidate's will, skill
and commitment. If some access to resources can be coupled with these
qualities the CEFE course should be able to impart the competencies this
person needs to start or expand their business. Establishing a fee for the
course is also another barrier that may elicit a favourable self selection
of participants. The determination of the size of the fee should be based on
the economic circumstances of the target group, the number of applicants in
relation to places, and the probable transaction costs already attributed to
the participant in terms of transport, accommodation, foregone income etc.
Charging some fee is always recommended as it does establish a more
business-like relationship between participants and promoters and generates
a sense of value to the whole exercise.
Identifying
complementary support
The
fourth factor to be considered during the design phase is to determine how to
structure the institutional support in a minimalist way. The major emphasis
should be placed on using the CEFE course as the trigger event for most of
the participants to either start-up a business or significantly expand it.
Higher success rates can be achieved through programmes that are linked with
other support institutions, particularly those associated with resource
access. Maximum costs-effectiveness can be achieved if the direct costs of
the CEFE intervention and the entrepreneurs time and transaction costs are
minimised on the one hand and business performance can be increased on the
other. This will usually require prior agreements with support institutions
to ensure that complementarity or a "fit" can take place and that
minimal resources are needed to generate a successful outcome.
Operational:
There
are five main factors that are important during the operation of the course:
the linking of learning with activity; providing adequate space and time for
processing; creating a supporting environment for change; being sensitive to
the culture of the target group; and developing technical competence in the
field of business management.
Linking
learning with activity
The
course is based on the premise that motivation, competencies and behaviour
can all be learned. The best way to learn these, outside of running a
business, is through simulating business situations that are designed to
elicit enterprising behaviour. By establishing a causal relationship between
changed motivation and changed activity leading to changed behaviour, the
next logical step is a changed attitude. For the motivation to be strong it
has to arise from a sense of self-discovery, and the participant must own
the motivation if the next stage of activity is to have a meaningful impact.
Through participation in the activity, enterprising behaviour is encouraged
and exercised. This is reinforced with new knowledge so that ample
justification exists for sustaining the change. This linkage accounts for
the impact that participants feel is beyond their business. It is simply a
better way of learning for adults.
Processing
lessons
The
potential for more profound learning is increased if there is sufficient
opportunity for the processing of the lessons. There is a temptation to get
caught up in the excitement of the activity which in most cases also has an
element of fun to it. Participants must be able to process their feelings
and reactions to the structured learning experience before they can identify
with any potentially new change. Activity without reflection is more likely
to cause confusion and frustration than enterprising behaviour. Sometimes
this processing is effective in groups and sometimes and in some cultures
this is best done alone or one-on-one with the facilitator. While
facilitators are given guidelines for each one of exercises, the emphasis is
on self-discovery and ownership of the process to ensure that any change
elicited is fully acceptable to the participant.
Supporting
enterprising behaviour
A
supportive environment for the change is more likely to sustain the change.
Ownership of the process has been mentioned before as a key element in any
behaviour change, but for the change to be long-lasting the environment of
the courses should also be conducive. For example, if participants can see
that the change is acceptable to fellow participants, this is a first and
positive step, also if the change is approved by persons that are respected
the likelihood of maintaining the change is greater. Success stories
presented by guest entrepreneurs and endorsements of a career in
entrepreneurship by valued persons in authority reinforce the acceptability
of the change as well as emphasise the anticipated rewards. Often the group
supports the change process most of all by commenting on or praising one
another on any kind of obvious enterprising behaviour. Facilitators are
trained to be sensitive to the uncertainties, if not insecurities that
participants may experience in the process. Although it is not necessary
that facilitators be psychologists they are trained in group dynamics and
how to support the change process.
Cultural
orientation
All
CEFE programmes are adapted to the target group. In addition to the specific
needs of for example, rural women, or educated unemployed, it is necessary
to deal with the cultural norms associated with enterprising behaviour and a
career in entrepreneurship. It is often socially unacceptable to be
assertive, business like, talk openly about money, or even openly express
one's opinion. These are all encouraged in a CEFE course as they are part of
the process of opening up, awareness and acceptance. Almost every culture,
even if it falls into the above category, has its own ways of doing
business. These ways are explored during a course to ensure that culturally
acceptable overtones can be laid on enterprising behaviour. The
investigation of some of these norms are done during the design stage in the
needs assessment however it is only during the course, and with the active
participation of the target group that resolutions can be found to blending
the culture with entrepreneurship.
Business
management skills
Much
of what has been said up to now has dealt with the change process, how to
stimulate it and reinforce it. Not much attention has been given to the
technical aspects of business management. This is because our understanding
of these skills is better and we have seen significant steps made in the
development of programmed learning materials that are suitable for
entrepreneurs. Rather than treating business skill development in a dry way
situations are structured to combine activity and learning with a certain
amount of fun in order for participants to acquire the skills needed to
analyse their businesses. Hours are spent in planning exercises, costing
problems, information collection, financial analysis, and the preparation of
business plans. Most of the business management training is conducted in a
way which simulates the activity of blending personal motivation and
competence with opportunity identification and implementation. When
participants are competent and confident about their own technical expertise
in business they are more able to convince investors, bankers, customers and
suppliers, i.e. they are more likely to succeed upon completion of the
course.
Sustainability
The
CEFE method aims at two levels of sustainability, the first is with the
participants of training courses, and the second is with the national and
regional implementing institutions that are always used as the executing
agencies for a CEFE programme. The sustainability of the results achieved
during the training is function of: how well the training was conducted; the
preparations for the course related to the involvement of the complementary
resource institutions; and the follow-up provided by the host executing
agency. At the level of sustaining CEFE within the host executing agencies
there are four factors that are of major importance: the choice of the host
agency; the development of qualified trainers; effective follow-up from
international sponsors of CEFE and the proper use of monitoring and
evaluation systems.
Choice
of implementing agency
In
choosing a host executing agency the ideal candidate is as close to the
target group as possible. This closeness is not in terms of proximity but
rather in character. The institution should be: relatively small, flexible,
sharply focused or minimalistic, aware of its own role and limitations,
project a positive image, market oriented and entrepreneurial. While it may
not be possible to find an institution in every instance with all of these
attributes, the closer one comes to it the more probable it is that the
commitment and motivation to sustain the programme will be present.
Qualifying
trainers
Product
quality can only be sustained if those producing and delivering the product
are sufficiently skilled. For this reason a great emphasis is placed on
qualifying trainers for the CEFE courses. Regional and sometimes national
training of trainers courses are held regularly to maintain and upgrade a
pool of experienced and motivated trainers. All practitioners are encouraged
to carry out their own research and make written contributions to their
agencies as a sounding board for methodological improvements and a launching
pad for new concepts and ideas for all of those involved with CEFE. In
addition to this international workshops exclusively for CEFE practitioners
are regularly organised to introduce innovations and upgrade senior trainers
in the latest methods.
Follow-up
There
are two levels of follow-up in CEFE, the first is with course participants.
Did they receive that loan? did they start their business? What kinds of
problems did they encounter? Host institutions are encouraged to network
with the enterprise community so as to facilitate opportunities for informal
support for ex-participants. These organisations often have counselling
services to assist former trainees with serious obstacles encountered in the
start-up or growth process.
Monitoring
and Evaluation
The
fourth key variable in the sustainability of CEFE is monitoring and
evaluating results. While the method itself has been positively evaluated,
to maintain the quality of each course a well functioning monitoring and
evaluation system at the national level is critical. This involves tracking
participants down, collecting data, and then analysing the information in
order to draw conclusions as to how improvements can be made in either the
operation of the course or in the business performance indicators related to
new start-ups or business expansion. Monitoring and evaluation systems
tailor-made for enterprise promotion have been introduced in several
countries and although they are still being tested the results so far have
been effective in providing the kind of feedback necessary for the
maintenance of quality courses.
CEFE
exercises
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You
will find in the following some exemplary CEFE exercices (Creation of Enterprises
through Formation of Entrepreneurs) for participants of start up and improve
your business workshops. Most of the exercises make part of the CEFE
manual that you can get for money on the
CEFE international webpage http://cefe.gtz.de/scripts/user1.asp?Sprache=1&DokID=112
Workshop
introduction exercices
developing personal entrepreneurial characteristics (PEC)
Situation
analysis (situation analysis.doc
(55 KB)
This
exercise utilises one key tool from the ”participatory action research”
(PAR) toolbox, namely the ”participatory drawing” which has been tested
in urban areas as well. While drawing the close environment of the planned
business, the participants deeply reflect in how far the different facets of
the environment could be harmful (threats) or helpful (opportunities) to
their emerging projects.
Tower
building (see CEFE international)
In
processing the exercise, the group analyses the entrepreneurs’ behaviours
concerning the establishment of goals and risks calculation. Another
analysed issue is the interference of external pressures, especially the
influence of relatives, with the accomplishment of the entrepreneurs’
goals.
To
be or not to be (see CEFE international)
In
this exercise, participants deal with productive forms of problem solution.
As many entrepreneurs, especially small ones, are not used to develop
strategies but to react and therefore have to face problems in business
life, the exercise has been created to become aware of personal problem
solving behaviour. The exercise can be used as an introduction to module
strengthening individual entrepreneurial competencies.
Johari
window (see CEFE international)
The
"Johari Window" helps understanding the process of interpersonal
relationship as well as its barriers and chances within a group set-up. It
depicts in a simplified form the areas of shared knowledge and information
as well as the unshared and the unknown areas. As such, it provides a
theoretical framework for the need to share information, seek and provide
feedback and openly discuss any matters which are about to come up during
the training programme so that learning can take place.
Endangered
hotel (see CEFE international)
The
”Endangered Hotel” is quite a new structured learning exercise dealing
with the ”art of receiving clients”; it was developed by a group of
course participants during a ”Training of Trainers” (ToT) held in
Douala, Cameroon in 1996. In the last week of CEFE ToTs, participants are
invited to develop new exercises which are tested with their co-participants
acting as target group. It happens from time to time, that these exercises
developed during ToTs are so convincing and so powerful that they become
part and parcel of the standard CEFE repertory.
Tower
of Babel (see CEFE international)
In
this exercise, participants have to build the highest structure possible
using wooden sticks. The participant that builds the highest one will be the
winner. The task is presented as to be accomplished individually, but if
some participants decide to work in groups, trainer should not interfere.
In
processing the exercise, it is important to analyse all performances,
especially those that were not successful. Trainer should explore those
behaviours which hinder the creative process, such as limited
interpretation, strict use of information and non-flexible reasoning.
Finally, creativity should be emphasised for entrepreneurship, as it is an
important tool for effective problems resolution and for better use of
opportunities.
Dart
exercise
(see CEFE international)
This
is an exercise that will make the participants experience the need to
formulate appropriate strategies in certain situations. The participants
will have to engineer and develop competence to use appropriate strategies
in a competitive situation. The exercise will also make the participants
experience certain personal enterpreneurial qualities such as risk taking,
commitment to work contract, opportunity seeking, goal setting, systematic
planning and self-confidence through real money investment.
Personal
goal setting (see CEFE international)
This
exercise is part of the training module in which participants - after having
identified and practised the basic entrepreneurial competencies - are
exposed to different situations and environments in which they are expected
to apply their competencies appropriately through different action-learning
experiences. Facing these different situations they can analyse their own
strengths and weaknesses to cope with the entrepreneurial world.
Project
ideas generation, screening and selection
Brainstorm
exercice (see CEFE international)
Brainstorm
is a dynamic tool, where quantities of ideas are offered with no criticism.
It can help people solve problems, develop new products or services and
increase productivity. In this exercise, the goal is to generate a great
amount of product/service ideas as a basis for the identification of an idea
of business to be explored in research and new business planning exercises.
Macro
screening (macro screening.doc -
55 KB)
The
”Macro Screening” exercise is a short but, nevertheless, very important
step positioned between the project idea generation and the final decision
about the most promising business idea. Trainers in different countries
attach different importance to this link; some ask their participants to
screen project ideas down to six whereas others advocate twenty during this
step. We think that the most practicable reality is somewhere in between,
and we suggest ten project ideas to be picked during this stage.
Search
for business ideas (see CEFE international)
This
exercise simulates the task of searching for information in 3 different
institutions, preparing the participants for the difficulties they will find
in fieldwork during the development of a business project.
Micro screening
SWOT
analysis (see CEFE international)
The
”SWOT Analysis” (= strengths, weaknesses, opportunities, threats) is the
last exercise of the ”project” module during the end of which the
participants are supposed to have identified THEIR projects. Based on these
concrete project ideas, they will have to undertake their market studies.
Business
planning and organizing, problem solution
Introduction
to business plan (see CEFE international)
This
document contains a very detailed guide to develop a business plan:
Business
Plan Format
Business
Plan Guide Questions
Part
I: GUIDE: Marketing
Plan, Production Plan,
Organisation
& Management Plan,
Financial Plan
Part II: EXAMPLE:
Marketing
Plan, Production Plan,
Organisation
& Management Plan,
Financial Plan
Part
III: WORKBOOK: Marketing
Plan, Production Plan,
Organisation
& Management Plan,
Financial Plan
a)
Market analysis
Market analysis
(see CEFE
international)
With this exercise, the participants get what may be their first contact
with a market research. They elaborate and apply a questionnaire twice:
first, they prepare a questionnaire to be tested by applying it to their own
colleagues in class. The participants tabulate the data gathered and make
their own conclusions on this research. This stage will be processed to give
the participants feedback. Then they will be asked to repeat this procedure,
making the necessary adjustments in order to interview the target group of a
specific product. Once again, the data gathered will be tabulated in order
to generate valuable information about the product/market. The trainer
determines the subject of both researches.
Market room simulation exercice
(see CEFE international)
In the market room simulation exercise participants are divided into buyers
and sellers. As a result of the buying and selling that occurs participant’s
experience the interplay of factors that influence buyers to purchase
products. These factors include price, product, place and promotion, the
four P’s of the marketing strategy.
Minimarket exercice (see CEFE international)
In this exercise, all participants act as individual sellers, trying to sell
a self-made or self-owned item or a service to the trainer who acts as
customer. In one corner of the room, a table is prepared with materials
participants can use for their production. As in real life, participants
have to perform in a limited market, as only few products will be acquired
by the trainer. After a short time given for preparation, the mini market is
opened to the customer offering many different products and eventually
services. He/she walks around, listening to one seller after the other
advertise their items. Finally the trainer chooses only three or less
products or services
b) Production (Costing)
Envelop
exercise (envelop exercise.doc
- 120 KB)
The
envelope exercise is one of the most complex simulation exercises in the
CEFE training as it treats all main aspects of a small manufacturing
enterprise. These are forecasting, planning, organising and managing,
manufacturing, marketing, negotiating, controlling, and financing, as well
as team working and leadership. It is also a very lively exercise with real
buying and selling transactions.
Mermatex
marmalade factory (see CEFE
international)
This
exercise is a case study, used to introduce participants to the study of the
technical aspects of a business plan or the managing of the production area
of an enterprise.
Pancake
making (see CEFE international)
This
exercise is part of the ”Production and Costs” module of the training
programme. It introduces the participants to the study of the technical
subjects of production management and cost estimation.
c) Organization and Management
Gant Chart, Legal Form of Enterprise, Nasa
d)
Finance
Cash flow exercice, Rooting ships, Profit and Loss Statement, Balance
CEFE
manual of trainers
[top]
The
CEFE manual of trainers contains the whole procedure of the CEFE training
course including practical exercises.
CEFE
manual table of contents
You
can get the entire manual for money on the CEFE international webpage
http://cefe.gtz.de/scripts/user1.asp?Sprache=1&DokID=112
CEFE
library
[ top]
For
more information on CEFE see papers in the CEFE library
http://cefe.gtz.de/scripts/user1.asp?Sprache=1&DokID=285
The
Cost Calculating Manual
[top]
go
to the cost calculating manual
Many
people are unaware of costs and waste scarce resources.
Cost
calculation is the way to calculate the total costs of making and selling a
product or providing a service.
How
can it improve the business?
-
Costing
helps to set prices
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Costing
helps to control and reduce costs
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Costing
helps to plan for the future
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Costing
helps to make better decisions
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Costing
helps to write a business plan to obtain a credit
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