t is probably the main complaint of anyone working in a small enterprise: “We are so busy working in the business that we have no time to work on the business.” The daily routine is either taken up trying to fulfil contracts or making new ones. Survival has to come before strategic thinking.
Javier Mendibil, a researcher at Labein, a Spanish technological centre, says the pressures on small companies prevent them from developing their management techniques. “Entrepreneurs recognise the dangers of neglecting the management side of business, but they lack the time and resources. They do not have time to reflect on how the business is run or acquire some of the management skills they lack.”
The poor awareness of business excellence models has implications for their levels of innovation too. “The management cycle and innovation are closely linked,” explains Grace McCarthy, a researcher from UMIST in the UK. “To get innovation you need lots of ideas, a buzz and excitement. You need a culture that allows these ideas to flourish. If someone at the top just says 'Do this. Do not do that!' you just will not get much innovation. People will have ideas, but they will not voice them.”
Entertain offers analysis tools and a structured approach to implementing better innovation management in small enterprises.
The recently completed Entertain project has assessed current models of business and innovation management and developed an approach to help small companies improve their management techniques and thus their overall levels of innovation. “The purpose of Entertain is to offer small businesses on-line access to information, self training and advice on a management model that will improve their innovative activities,” says Mendibil. “The tools and templates are easy to use and should help small enterprises develop a robust innovation strategy.”
The Entertain approach is based on the European Foundation for Quality Management's (EFQM) Business Model of Excellence. EFQM began in 1988 and its management model has been adopted in around 20,000 organisations across Europe. However, where the EFQM model is a broad-based management model, the Entertain approach focuses closely on innovation.
The four main research participants in Entertain worked with ten small businesses to develop and test the entire methodology, and evaluate the impact of EFQM on their innovative strength.
Entertain begins with a self-assessment of all the areas of business that may impact innovation, from innovation strategy to people, culture and financial resources. As soon as you submit the online questionnaire you receive a tailored report on the state of innovation and its management in your organisation. “This is an important feature,” says McCarthy. “It uses complex scoring mechanisms, based on a technique called evidential reasoning, to produce a company profile that highlights strengths and areas where innovation could be improved. The report helps companies to decide where they will focus.”
But Entertain does not stop there (see figure 1). It also provides templates for situation analyses, along with good practice examples. In the longer term, the project partners also hope to be able to deliver consultancy services on-line, a more affordable option for companies seeking external advice. Together, these tools and services enable companies to produce clear business goals and outline the steps they need to take to implement better management practice.
Another handy tool is the Entertain Ideas Bank. This is simply an on-line store for all the innovative ideas generated within the company – from the cleaner to the CEO. “The novelty here is that it is on the web and anyone can log in,” says McCarthy. “Many good ideas occur on the spur of the moment and are too easily forgotten, especially in small enterprises. If everything is logged they can all be reviewed and prioritised.”
Consult IT from Norway has found the Ideas Bank invaluable. “Our analyses showed us that we had no formal way to collect and maintain new ideas,” explains Morten Rosmael. “Now, if one consultant gets an idea he can put it straight into the Ideas Bank, but we do not have to discuss it immediately. We also run idea-generating workshops and register all the ideas – good and bad – that come out. Every two months we review the Ideas Bank and decide what we are going to do with them.”
By combining several innovative ideas together, Consult IT has been able to expand its presence in the health administration market. In two years, it has increased its revenues in this sector from 1.5 to 8 million krone.
Yateson Stainless, a small UK manufacturer of stainless steel products, also testifies to the benefits that clear innovation management processes can have for a company. “Our work with Entertain has made us much more self-aware,” says Richard Yates. “We look at the way we do things and try to modify them. One aspect of our company that we have addressed is internal communication. So we have opened meetings up to everyone and created an open communications front to get people's ideas. We have come up with some exciting new product developments from brainstorming which we might not have done without getting involved with Entertain.”
“A lot of Entertain is similar to ISO 9000 – it is good procedural practice. But despite ISO, there is so much more companies could do to improve their innovation. Entertain shows small companies – with or without ISO 9000 certification – how they can become more innovative and thus more competitive.”
Of course, even with the simplest on-line tools, business managers still must find the time to log on and follow through the Entertain process. McCarthy agrees, but she believes that companies will see a return on their investment. “Once they start to improve their management they will see the benefits, and will change the culture. They will want to keep going. Entertain generates a virtuous cycle because, as you see the benefits of innovation, you free more resources to be innovative!”
With positive feedback from the ten trial companies, the Entertain partners have high expectations for their approach. “We have a tested prototype and intend to keep working on it,” says Mendibil. “We have already done two versions of the self assessment, one for manufacturing companies and the other for service companies, and will try to adapt it for firms in different sectors or contexts.”
“There are so many small enterprises in Europe that the market for this is huge,” adds McCarthy. “Innovation is the one thing that keep business moving ahead of competition. If we do not make changes, changes will happen, so it is better to be in control. Entertain helps small companies to learn how to do this effectively.”