BUSINESS

Entrepreneurship Education
in Schools and Technical Vocational Training Institutions and Higher Education

KNOW ABOUT

FACILITATORS GUIDE

Authors: George Manu Robert Nelson John Thiongo Klaus Haftendorn

Editors: Peter Tomlinson and Klaus Haftendorn

International Labour Office, Geneva International Training Centre of the ILO, Turin

Copyright International Training Centre of the ILO 2008 This publication enjoys copyright under Protocol 2 of the Universal Copyright Convention. Applications for authorization to reproduce, translate or adapt part or all of its contents should be addressed to the International Training Centre of the ILO. The Centre welcomes such applications. Nevertheless, short excerpts may be reproduced without authorization, on condition that the source is indicated.

Know About Business ISBN 92-9049-396-8 First published 1996 Second edition 2000 Third edition 2002 Fourth edition 2004 Revised edition 2005 Revised edition 2007 Revised edition 2008

The designations employed in the publications of the International Training Centre of the ILO, which are in conformity with United Nations practice, and the presentation of material therein do not imply the expression of any opinion whatsoever on the part of the Centre concerning i.a. the legal status of any country, area or territory or of its authorities, or concerning the delimitation of its frontiers. The responsibility for opinions expressed in signed articles, studies and other contributions rests solely with their authors, and publication does not constitute an endorsement by the Centre of the opinions expressed in them. Publications of the Centre, as well as a catalogue or list of new publications, can be obtained from the following address: Publications International Training Centre of the ILO Viale Maestri del Lavoro 10 10127 Turin, Italy Tel: +39 11 693-6693 Fax: +39 11 693-6352 E-mail: publications@itcilo.org http://www.itcilo.org

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Foreword
At the end of the 1980s and beginning of the 1990s the ILO was strongly involved in SME development and vocational education through a number of projects implemented together with government institutions and private sector institutions. Training of entrepreneurs in management skills was part of those projects. Entrepreneurship education was seen as an important element to develop entrepreneurial attitudes for future entrepreneurs. However, no specific training programmes were available. To close this gap, funds were provided from ILO Geneva (SED unit in ENT/MAN) and from the International Training Centre of the ILO in Turin (SME unit) in 1996 to develop a training package for TVET institutions that includes entrepreneurial education and business skills. A workshop was organized in Turin with the participation of Mr. G. Manu from ITCILO, Mr. J. Thiongo, a Kenyan consultant and Prof. R. Nelson from the University of Illinois, USA to develop the Know About Business training materials for trainers and instructors of TVET institutions. The material was field tested in Kenya and then finalized and printed. Entrepreneurship education stimulates young people to think about entrepreneurship and the role of the business community in economic and social development. Students also get an opportunity to analyse the changes taking place in their countries and are encouraged to consider self-employment and enterprise creation as a career choice. The importance of education and training for an entrepreneurial society has been underlined on several occasions through United Nations Declarations, recommendations by the European Union and national Governments. ILOs Recommendation No. 189, adopted in 1998, refers to entrepreneurship education as a way of promoting a positive enterprise culture. The Millennium Development Goals adopted in 2000 address the problem of high youth unemployment and the challenge to create employment for Youth, in particular in developing countries with a high percentage (up to 50%) of young citizens under 25. The Youth Employment Network (YEN) composed of the UN Secretariat, the World Bank, and the ILO was initiated by the UN Secretary General to actively promote Youth Employment. ILOs Decent Work Agenda include creation of Youth entrepreneurship as one way to create decent employment. Between 2001 and 2004 a number of countries adopted KAB in their National Education Programmes. The experience of using KAB and an increasing demand for the introduction and adaptation of KAB in other countries led to the decision to review and update KAB so that it

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corresponds better to the needs of education programmes in a fastchanging and globalizing world. A one week workshop in ILOs International Training Centre (ITCILO) was organized by the Enterprise Development Programme Manager Mr. Peter Tomlinson and Mr. Klaus Haftendorn, Global KAB Programme Coordinator, with the authors and KAB practitioners in May 2004. The outcome of this review workshop was the 2005 KAB edition with additional topics for Modules 6 and 7, and a new Module 9, How to Elaborate Ones Own Business Plan, written by Klaus Haftendorn to enable students and learners to test a business idea in a real life situation. The focus of KAB was thus extended from vocational training to general secondary education and higher education. At the same time, the Global KAB Programme Coordinator developed a comprehensive KAB promotion and implementation strategy combining resources from ILO SEED, ILOs field structure and ITCILO. Since then, and till 2007, ten countries have, after pilot testing, introduced KAB in their national curriculum, ten countries are running the one-year KAB school test, and twelve countries are preparing the pilot phase. The KAB materials have been translated into 15 languages. Based on this extensive experience, KAB facilitators, teachers and students from national KAB programmes gave positive feedback and proposed new topics to be included in the training materials. To respond to this feedback, the Global KAB Programme Coordinator and Professor Robert Nelson have further reviewed the KAB materials and developed the 2007 edition with additional topics and a revised course structure. This new edition constitutes the generic international version of Know About Business for all further national adaptations. Many thanks are given to all those who participated in the revision work of KAB and contributed to the new generic version. Klaus Haftendorn and Peter Tomlinson Editors of KAB

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Facilitators Guide

KNOW ABOUT BUSINESS

Facilitators Guide
Table of Contents:
Page Foreword ............................................................................ 1 A Introduction to the Know About Business (KAB) package ...... 5

What is the background and general aim of KAB?............ 5 Why is education for entrepreneurship important?........... 6 Scope of enterprise..................................................... 7 Gender considerations................................................. 8 Language versions...................................................... 8

B C D E F G H

Objectives of KAB ........................................................... 8 Target group and beneficiaries of KAB.............................. 15 Modules, contents, format and duration of KAB ................. 16 How and who to teach KAB? ........................................... 19 Training methodology for KAB ........................................ 25 Assessment and evaluation ............................................ 30 References and further reading ....................................... 30

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INTRODUCTION TO THE KNOW ABOUT BUSINESS (KAB) PACKAGE

WHAT IS THE BACKGROUND AND GENERAL AIM OF KAB?

With high unemployment, public sector retrenchment, downsizing in corporations and other restructuring programmes now in full swing in many countries, self-employment and small enterprise promotion are presently high on the agenda of virtually every country. The youth presents a particular challenge in this scenario. Defined as young people under the age of 25 (and up to 40 years of age in some countries), the youth represents up to 70% of the population in many developing and industrializing countries, and almost one-third of the population in emerging economies. At the same time, every year hundreds of thousands of school leavers join the labour market in these countries in search of gainful employment. The challenge for many societies is thus one of not only tackling the already sizeable unemployed and underemployed population, but also of absorbing the new entrants into the labour market. In both situations, young people constitute the majority. As a consequence, in recent times there has been much concern amongst policymakers and others to re-orient education and training systems to prepare learners for a situation where formal wage employment may not exist. In the process, a few countries have initiated programmes to put entrepreneurship on their educational agenda, and the International Labour Organization (ILO) has provided technical assistance in this regard to several countries. For the vast majority, however, such initiatives have yet to begin and the ILO continues to receive many requests for assistance towards this end. Against this backcloth, the ILO has developed in 1996 the Know About Business (KAB) package a set of training materials for entrepreneurship education and a new methodology to learn. The KAB materials draw on ILOs successful experience of enterprise promotion in the field, and closed the gap of knowledge about entrepreneurship. Since then KAB had been reviewed to incorporate in the training package the experience gained in more than 20 countries during the last five years. The KAB package seeks to develop entrepreneurial skills and in the process prepare young people in education, not only to establish their own businesses at some point in the future, but also to work productively in SMEs. In so doing, at a broader level, the overall objective of KAB is to contribute towards the creation of an enterprise culture in a country or society. The purpose of KAB is not necessarily to have young people begin their careers as entrepreneurs or self-employed people. Rather, it is to give them awareness and some practice of the opportunities, challenges, procedures, characteristics, attitudes and skills needed for entrepreneurship. Having said that, local and other sources of information concerning self-employment and starting a small business, should be included when using the materials, to assist young people who might need them in the future.

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The KAB programme was initially designed for use in vocational education and training institutions. In 2005 it was updated for secondary schools, colleges and universities. The programme has been put together in such a way as to allow its introduction into a variety of classroom settings. The rationale for teaching entrepreneurship at schools is that specific characteristics are essential to success in business, and therefore the training of potential entrepreneurs must not be put off until they are adults, by which time they may have acquired many non-entrepreneurial habits. Any teacher, who desires to introduce entrepreneurship and small business management concepts within their classes, should find the package useful. By following this guide and modules, teachers will be able to provide instruction in entrepreneurship and small business management to vocational and technical education students. Finally, it is important to point out that the Know About Business Programme cannot produce miracles overnight. The creation or development of an enterprise culture takes time.

WHY IS EDUCATION FOR ENTREPRENEURSHIP IMPORTANT?

As indicated above, introducing entrepreneurship into secondary schools and vocational education and training programmes prepares learners for a selfemployment situation at a time where formal wage employment may not exist. It may also stimulate more young girls and boys to establish their own businesses. As more people create their own and other jobs through self-employment and new business formation, the number of unemployed people should decrease. In this regard, small and medium-sized enterprises (SMEs) have a clearly demonstrated capability. In most countries of the world, SMEs account for over 60% of non-farm, formal sector employment. Moreover, most of the new jobs created in the last 10 years in Europe and the USA, for example, have come from SMEs. What is more, SMEs account for over 80% of enterprises in virtually all countries. In the European Union, for example, SMEs comprise over 98% of all enterprises. Job creation depends in large part upon the initiation and expansion of small businesses. Entrepreneurs have the ability to spark new ideas and develop new products and services that create new businesses, which in turn create the need for new jobs. Most economic development programmes designed to stimulate new job opportunities have been aimed at a relatively few large corporations. However, it is the thousands of anonymous smaller firms, which employ fewer than 20 employees, that are the primary job providers in urban areas, and they also provide a major share of new jobs in rural areas as well. An important aspect of economic growth in any country is the key individuals who promote change and initiate development activities. These persons may be called entrepreneurs because they have the ability to identify needs within their environment, gather appropriate resources and implement action to satisfy these needs. The activities of most entrepreneurs are oriented toward the immediate environment in which they live (community) and work (either as employees or employers). If the entrepreneurs prosper, the communities in which they operate will also prosper.

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Some of the reasons why entrepreneurs initiate businesses within their communities include: (a) personal satisfaction, (b) achievement orientation, (c) need for recognition, (d) expression of leadership ability, (e) self-motivation, and (f) profits. Entrepreneurship education may also be called citizenship education, because it provides people with the skills to take action and make changes which will improve the environment within their community. If entrepreneurship development were to have a single purpose, it could well be expressed as improvement in the quality of life or, put another way, the provision of life skills. A healthy small business sector will contribute to a more even distribution of income throughout the population. In this regard, some of the strongest arguments for entrepreneurship education have a social orientation. Because of the limited capacities of large-scale businesses to provide employment and bring about development and growth, viable alternatives are being sought. To this end, the small business sector has received considerable attention because of its pervasive role in both urban and rural areas. It is in the setting of the small business operation that employers and employees can exhibit and practise many entrepreneurial characteristics. While large-scale businesses are necessary in particular industries, such as petrochemicals, in most others SMEs play a key role in the development and transfer of appropriate technology, creating a stable local/regional economy and industrial diversification, among other things. One sobering factor with which those with responsibilities for SME development have to come to terms is the generally high failure rate of businesses. In developed countries, approximately 50% of all new businesses fail in their first three years of existence. In developing countries, although hard facts are hard to come by, the failure rate is even higher. In spite of this, self-employment continues to rank high as a career choice everywhere. The failure rate is a serious problem, and it is compounded by research findings indicating that over 60% of the money used to initiate small businesses is generated from private sources such as personal family savings, and borrowing from friends and relatives. When a small business fails, it is often not only a case of financial difficulty but also a family tragedy. The psychological problems of the people involved may be as great, or greater than their financial losses. In many instances, these failures could have been avoided by proper education and training before the business was initiated. The decision to become self-employed is a major one, and it warrants careful consideration and appropriate training. If young people are aware of the issues as well as the challenges of becoming an entrepreneur and/or working in a small enterprise, they will be better prepared not only with regard to choosing entrepreneurship as a career option, but also to working productively and succeeding in SMEs.

SCOPE OF ENTERPRISE
In designing the KAB materials, enterprise has been defined broadly to mean any undertaking or project that involves the organization of the factors of production. This could be profit-making or not, and may be for the good of an individual, a group or the community as a whole. Accordingly, an entrepreneur in this context is someone who sets up and runs such a project or undertaking. Notwithstanding this, given the focus of ILOs existing packages, the emphasis of the materials is on profit-making

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business enterprises (particularly self-employment, and small and medium-sized enterprises). The authors coming together and operating from three continents have consulted, adapted and utilized best practice described in similar packages from several countries. This not only gives the materials an international basis, but also makes them more adaptable for use in different environments. In addition, and importantly, the materials draw on the ILOs successful experience in executing projects aimed at promoting an enterprise culture in various countries, most notably Bolivia, Peru, Kazakhstan, Kyrgyzstan, Kenya, China, Sri Lanka and Indonesia. Account has been taken of the fact that the ILO has already developed training materials for setting up a business, and for improving or expanding an existing business, called Start Your Business, Improve Your Business and Expand Your Business respectively. In this context, this package is intended to fill the important pre-start gap with the information that was missing.

GENDER CONSIDERATIONS
Care has been taken to represent males and females equally, in other words to be gender sensitive or neutral throughout the KAB materials. This is reflected not only in the presentation of concepts, but also in the selection of examples, case studies, exercises, graphic material and illustrations. Facilitators are encouraged to maintain the same position in using KAB, and are invited to discuss gender issues and how to achieve gender mainstreaming in enterprise development while conducting KAB training.

LANGUAGE VERSIONS
KAB is currently available in 15 languages; English, French, Spanish, Arabic, Russian and Chinese, the UN official languages with the largest outreach, as well as in other national adaptations, such as Portuguese, Singhalese, Tamil, Vietnamese, Indonesian, Laotian, Uzbek, Kyrgyz, Kazakh, and Tajik, and the list is growing.

OBJECTIVES OF KAB
Create awareness of enterprise and self-employment as a career option for students in secondary education and trainees in vocational and technical training institutions. Develop positive attitudes towards enterprise and self-employment. Provide knowledge and practice of the required attributes and challenges for starting and operating a successful enterprise, particularly a small business. Prepare young women and men to work productively in small and medium-sized enterprises and, more generally, for an environment in which formal, full-time wage employment may be scarce or unavailable.

The immediate objectives of the KAB package are to:

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The specific objectives of the nine modules and the business game of the KAB package are set out below: Module 1 Objectives What Is Enterprising? To enable learners to recognize that everybody is involved in an enterprise in one way or another. To enable learners to appreciate that everybodys lifestyle is affected by the roles they play in their enterprises. Topic 1 Objective Enterprises in your Community To enable learners to understand that enterprises in their community provide goods and services that they consume and as jobs they provide wages and salaries to people living in the community. To enable learners to understand the various types of enterprises that exist in their community. Topic 2 Objective Meaning and scope of enterprising To enable learners to identify and interpret the terms and elements involved in the concept of enterprise, both at personal level and in the context of being enterprising in business. Self-management skills To identify self-management skills and how they are important to be enterprising. To apply self-management principles in job situations. Topic 4 Objective Decision making skills To enable learners to know how to apply a rational approach to making personal and business decisions. Why Entrepreneurship? To enable learners to recognize that being entrepreneurial in business and non-business situations is beneficial at individual, family, community and society levels. Entrepreneurship defined To provide learners with an appreciation and understanding of the elements and concept of entrepreneurship.

Topic 3 Objective

Module 2 Objective

Topic 1 Objective

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Topic 2 Objective

Reasons for entrepreneurship in business To enable learners to understand the guiding features of entrepreneurship that enable businesses to succeed. Entrepreneurial motivation To understand the various motivational factors that entrepreneurs possess and utilise in their daily activities. Setting entrepreneurial goals Learners will develop their goal-setting skills by becoming familiar with specific guidelines for setting goals. Risk-taking To enable learners to demonstrate the skills needed to assess and evaluate a risk. Who Are Entrepreneurs? To enable learners to appreciate the personal characteristics needed to be a successful entrepreneur. Assessing entrepreneurial potential To enable learners to assess their potential for becoming future entrepreneurs. Identifying entrepreneurial characteristics To enable learners to identify a variety of entrepreneurial characteristics which are important for success in owning and operating a business. Entrepreneurial leadership To enable learners to identify leadership qualities which are essential to the success of entrepreneurs. Principles of negotiation To enable learners to understand the rules of successful negotiation. Listening skills Participants will be able to define listening. They will be introduced to the importance of listening in the communication process.

Topic 3 Objective

Topic 4 Objective

Topic 5 Objective

Module 3 Objective

Topic 1 Objective

Topic 2 Objective

Topic 3 Objective

Topic 4 Objective Topic 5 Objective

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Module 4 Objective

How Do I Become an Entrepreneur? To provide an understanding of the key competencies and determining factors for success in entrepreneurship and small business management. Importance of entrepreneurship in society To enable learners to appreciate that the advancement of individuals and society in general is greatly enhanced when entrepreneurship is adopted. Self-employment To enable learners to appreciate that self-employment is a lifestyle that may suit some of them upon graduation. Small enterprises To enable learners to understand facts about small enterprises. Key success factors in setting up a small business To enable learners to identify and describe the key variables which might determine success in setting up a successful small business. At the same time, the learners will develop an awareness of what is required to avoid failure or minimize the risks. The decision to become an entrepreneur To enable learners to explain why and how people make the decision to start and run their own businesses. How Do I Find a Good Business Idea? To provide techniques for generating business ideas as well as for identifying and assessing business opportunities. Creativity and innovation By being involved in a variety of class activities, learners will have the opportunity to become aware of their own creative potential. By thinking of ways to change an existing situation or object, learners will learn to apply techniques for developing their creative ability.

Topic 1 Objective

Topic 2 Objective

Topic 3 Objective Topic 4 Objective

Topic 5 Objective

Module 5 Objective

Topic 1 Objective

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Topic 2 Objectives

Generating ideas To enable learners to: (a) appreciate the importance of having a good business idea as a prerequisite for successfully starting a business and for an existing business know how to generate business ideas

(b) Topic 3 Objective

Identifying and assessing business opportunities To enable learners to appreciate the importance of, and possess techniques for identifying and assessing business opportunities. How Do I Organize an Enterprise? To enable learners to appreciate the procedures required for organizing an enterprise. Selecting a suitable market To enable learners to understand the procedures for identifying a suitable market for a business. Selecting a business location To enable learners to understand the major factors to be considered when selecting a location for a business. Legal forms of business ownership To enable learners to understand the four basic types of business ownership and the advantages and disadvantages of each type. Money needed to start an enterprise To enable learners to make the distinction between pre-operation payments and initial operation payments and to estimate the amount of money needed to start an enterprise. Obtaining money to start an enterprise To enable learners to identify the advantages and disadvantages of using various sources of capital to start an enterprise.

Module 6 Objective

Topic 1 Objective

Topic 2 Objective

Topic 3 Objective

Topic 4 Objective

Topic 5 Objective

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Topic 6 Objective

Ways of getting into business To enable learners to identify the advantages and disadvantages of buying an existing business, starting a new business or operating a franchising business. How Do I Operate an Enterprise? To enable learners to appreciate the various techniques that will affect the management of an enterprise. Hiring and managing people To enable learners to understand the importance of selecting and managing employees who will help to maximize the success of the business. Managing time To enable learners to understand why time is a resource that must be managed by entrepreneurs. Managing sales To enable learners to understand that selling is an art, and for entrepreneurs to be successful in business they must be good at selling their products and/or services. Selecting suppliers To enable learners to identify the various ways in which a supplier can contribute to the success of the business. Using technology in small business To enable learners to be aware of how new technologies can affect small business. Knowing the costs of an enterprise To make learners aware that there are different types of costs that occur in a business. To know the costs and to keep costs as low as possible is essential for the profit that a business can make. Managing money To enable learners to understand the importance of financial record keeping in a small business.

Module 7 Objective

Topic 1 Objective

Topic 2 Objective

Topic 3 Objective

Topic 4 Objective

Topic 5 Objective

Topic 6 Objective

Topic 7 Objective

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Topic 8 Objective

Using financial statements To enable learners to appreciate the importance of keeping simple financial statements in a small business. What Are the Next Steps to Becoming an Entrepreneur? To enable learners to pursue plans to start an enterprise. Preparing a business plan To enable learners to understand the process of writing a business plan after going through the major steps of developing one. How to Interpret the Findings of the Business Plan To enable learners to assess the findings and results of the Business Plan. To enable learners to have a clear idea about the feasibility of the business idea.

Module 8 Objective Topic 1 Objective

Topic 2 Objective

Topic 3 Objective

Evaluating factors in starting an enterprise To enable learners to understand the problems that may be encountered when starting an enterprise. Sources of Information and assistance To enable learners to know how to obtain and use various sources of information and assistance for their future businesses. Maintaining an entrepreneurial outlook To assist learners in keeping an open mind towards entrepreneurship. How To Elaborate Ones Own Business Plan To enable learners to apply KAB knowledge to a real market situation and to evaluate a business idea for either self-employment or a micro business. How to Elaborate the Business Plan To enable learners to apply KAB knowledge to a real market situation. To inform learners that a business plan must contain a number of items of information. However, the layout of a business plan can and has to be adapted to a concrete case. Standard Business Plan

Topic 4 Objective

Topic 5 Objective Module 9 Objective

Topic 1 Objective

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Business Game Objective To provide an opportunity to experience the effects of business decisions in a simulated business environment Introducing the business cycle To enable learners to learn about the basic business cycle, including planning the best use of capital for conflicting demands, maintaining a positive cash flow and the importance of keeping records Understanding demand and supply To enable learners to learn about estimating market size and demand, planning production and purchases, costing, record-keeping and business planning Reaching your customer and improving your business To enable learners to learn about the importance of location and promotional tools such as advertising in reaching customers and improving business.

Module 1 Objective

Module 2 Objective

Module 3 Objective

TARGET GROUP AND BENEFICIARIES OF KAB

TARGET GROUP
The KAB package is directed towards trainers/teachers in secondary education and vocational and technical training institutions. The materials can be adapted for use in both industrialized and developing countries, as well as in further and higher education institutions. It is assumed that the trainers/teachers using the materials would typically possess a diploma or higher level education, and that they would have some technical skills but little or no previous business/enterprise experience.

BENEFICIARIES
The KAB materials are intended to be used for trainees/students in secondary education and vocational and technical training institutions. The trainees/students would typically be 15 years of age or over, possess a minimum of 12 years formal education (the equivalent of a school leaving certificate) or high school grades, and have no business/enterprise experience. A Learners Workbook is available for learners.

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MODULES, CONTENTS, FORMAT AND DURATION OF KAB

MODULES AND CONTENTS

The KAB package comprises a Learners Workbook, a Facilitators Guide, 9 modules and a business game. A CD-ROM interactive package is also available for support. Each module represents a key area of entrepreneurship and is divided into several topics. Furthermore, each module is intended as a stand-alone package, requiring no previous knowledge of the others. The titles of the modules are in the form of questions, the answers to which learners should know upon completion of the modules. Learners Workbook Worksheets Glossary of economic terms KAB Facilitators Guide Introduction to the Know About Business (KAB) package - What is the background and general aim of KAB? - Why is training for entrepreneurship important? - Scope of enterprise - Gender considerations Objectives of KAB Target group and beneficiaries of KAB Modules, contents, format and duration of KAB How and who to teach KAB? Training methodology for KAB Assessment and evaluation References and further reading Module 1 What is Enterprising? (13 hours/sessions)

T1 Enterprises in Your Community T2 Meaning and Scope of Enterprising T3 Self-Management Skills T4 Decision-Making Skills

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Module 2

Why Entrepreneurship? (13 hours/sessions)

T1 Entrepreneurship Defined T2 Reasons for Entrepreneurship in Business T3 Entrepreneurial Motivation T4 Setting Entrepreneurial Goals T5 Risk-Taking Module 3 Who Are Entrepreneurs? (16 hours/sessions)

T1 Assessing Entrepreneurial Potential T2 Identifying Entrepreneurial Characteristics T3 Entrepreneurial Leadership T4 Principles of Negotiation T5 Listening Skills Module 4 How Do I Become an Entrepreneur? (14 hours/sessions)

T1 Importance of Entrepreneurship in Society T2 Self-Employment T3 Small Enterprises T4 Factors in Setting up a Small Business T5 Decision to Become an Entrepreneur Module 5 How Do I Find a Good Business Idea? (8 hours/sessions)

T1 Creativity and Innovation T2 Generating Ideas T3 Identifying and Assessing Business Opportunities Module 6 How Do I Organize an Enterprise? (16 hours/sessions)

T1 Selecting a Suitable Market T2 Selecting a Business Location T3 Legal Forms of Business Ownership T4 Money Needed to Start an enterprise T5 Obtaining Money to Start an enterprise T6 Ways of Getting into Business

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Module 7

How Do I Operate an Enterprise? (22 hours/sessions)

T1 Hiring and Managing People T2 Managing Time T3 Managing Sales T4 Selecting Suppliers T5 Using Technology in Small Business T6 Knowing the Costs of an Enterprise T7 Managing Money T8 Using Financial Statements Module 8 What Are the Next Steps to Becoming an Entrepreneur? (16 hours/sessions) T1 Preparing a Business Plan T2 How to Interpret the Findings of a Business Plan T3 Evaluating Factors in Starting an Enterprise T4 Sources of Information and Assistance T5 Maintaining an Entrepreneurial Outlook Module 9 How to Elaborate Ones Own Business Plan (2 hours/sessions) T1 How to Elaborate the Business Plan Standard Business Plan

FORMAT OF MODULES
The materials themselves are presented in modular format, for flexibility. Although the subject matter for each module is different, the format for each module is similar and contains the following components: 1. Module Title: Indicates the major focus of the module. 1.1 Module Objective: Specifies the expected outcome for the learner. 2. Topic: Indicates the specific aspect of entrepreneurship presented in the module. 2.1 Suggested Time: Gives the approximate amount of time the facilitator should spend on each topic. 2.2 Objective: Indicates the desired outcome of the activity. 2.3 Rationale: Gives a summary of the reasons for studying a particular topic. The facilitator may wish to share this information with the learners to help them to understand the purpose of the activity. This may be done at the beginning of the topic as an introduction, or it may be used as a summary at the end of the topic.

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2.4 Activities: Includes a step-by-step description of how to conduct each activity. Each topic contains transparencies, learner worksheets, a handout and supplementary notes for the facilitator. 2.5 Key Learning Points: Some modules also provide a summary of the main findings and lessons emanating from the activity.

LEARNERS WORKBOOK
The Learners Workbook, as the title suggests, is intended for the final beneficiaries. It contains the worksheets for all the modules and a glossary explaining economic terminology used in KAB.

DURATION OF A FACILITATOR WORKSHOP

A ten-day intensive workshop is all that would be required initially to equip the target group (trainers/teachers) to deliver the material. From time to time, further in-service workshops (lasting one or two days) may be organized to monitor progress and/or enhance knowledge and skills.

HOW AND WHO TO TEACH KAB?

HOW SHOULD KAB BE TAUGHT?

The total time required for delivering the programme is approximately 120 hours/sessions (excluding the business game which requires an additional 10 hours/sessions). Ideally, KAB should be integrated in the National Curriculum and taught over a period of one or two academic years. The programme may however be adapted, and delivery adjusted to fit the time available at the institution. Beside this, it could also be implemented: 1. 2. as a Business Club activity after school hours. as an intensive short course taught during the schools vacation period.

Complementary activities - Learning through enterprise Enterprise education is about doing just as much as it is about learning. It is in fact learning by doing. Young people learn about enterprise but also through enterprise. One way of implementing learning by doing is by encouraging and assisting learners to set up micro and small businesses operated from their educational or training institution. The enterprise idea could be as simple as selling sweets on campus or washing cars in the neighbourhood at weekends, to more complex dealings involving activities such as the production and marketing of a product/service or commissioning the production of sportswear or greetings cards, for example. Ideally, the business idea would come from the learners themselves, who would organize themselves, register and operate the business, produce a set of accounts at the end of the accounting period, have them audited and decide on dividend

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payments, if any. At the end of the school year or accounting period, the enterprise might be dissolved, or shares traded and a new group of directors voted in. The facilitator could play an important role in guiding the whole process. He or she could also arrange or provide counseling or additional training for the learners, when required, as well as facilitate contacts and negotiations both with the school/college authorities and with the outside world. A new Module for this purpose is under preparation. An additional extracurricular activity could be the setting up of a business club, which might involve visits to companies, inviting speakers to the school/college to address topics of interest, debates, etc. Again, the learners themselves would organize and operate the club, with the facilitator acting as mentor. Apart from contributing to the development of an enterprise culture, such initiatives would be likely to develop a sense of responsibility among learners and also make enterprise education a lot more fun. Try it! Recognition of the importance of the foregoing activities would require directors or principals of education and training institutions to reward all those involved, compensating the facilitators in particular for their time and effort. Adapting KAB materials Facilitators should feel free to adapt the KAB materials, and especially the exercises, to suit their local conditions and circumstances, if they so desire or the need arises. In particular, case studies and examples drawn from the local community should be used wherever possible. The involvement of local successful entrepreneurs as guest speakers should also be encouraged, as well as visits to enterprises in the community which could serve as role models. Approach Although they are intended to be used by teachers/trainers, the materials are learnercentered, which means that the learners are involved throughout the process and responsibility for learning moves from the teacher/trainer to the learner. This is achieved when the teacher/trainer becomes a facilitator and creates a learning environment whereby learners can engage in structured experiences individually, in small groups or as a class, and through a process of reflection and review, develop certain skills. These skills can then be applied to a variety of situations. To achieve this outcome, a range of learner-oriented training methods are used throughout KAB (see the section on Training Methodology below). Techniques such as group discussion, role play, counseling and brainstorming are employed to ensure the active participation of learners throughout the learning process. In this process, KAB encourages and assists learners to:

identify their interests express feelings

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apply what they have learned to other situations understand ways in which they learn best discover what motivates them learn from their experiences assess their progress correct their mistakes establish performance standards for themselves gain insights improve their adaptability

Learner-oriented instruction is not only concerned with the outcome, but also the steps that each individual takes to achieve the outcome. A great deal of emphasis is therefore placed on learner motivation. Developing a session plan At the beginning of each KAB module there is a session plan listing the topic, suggested time, objective, rationale, instructions for the activities including training methods, teaching aids and content, and sometimes also a summary. These are the core elements of a session plan which, essentially, provides a step-by-step guide for conducting training. Facilitators may follow the plan given in the modules, or develop their own session plan if they so desire. Session plans ought to be updated from time to time in the light of experience, and they should be flexible. Business game It is recognized that most learners and facilitators using KAB will not have managed, and may not even have worked in an enterprise before. In order to address this aspect, and to enhance knowledge and skills, a simulated business game is included in the KAB package to provide learners with the opportunity to experience just how business operates in real life. The Game, as it is called, was developed for the ILO and has three sequential modules. Each module has learning objectives set at a higher level than the previous one. Thus, facilitators and learners should start with module 1, then progress to modules 2 and 3 with time. For the training of facilitators, the business game can also be used as an ice-breaker at the outset. For the main beneficiaries of KAB, however, the business game may be introduced, starting with the first GAME module, in Module 4, Topic 3, entitled Small Enterprises. Modules 2 and 3 of the game may be played during Module 6 and/or Module 7 of KAB. The game may be repeated if necessary, for more practice or to reinforce learning. As with all aspects of KAB, the facilitators need to be trained first, as they need certification before they can run the game. Detailed instructions on the game for facilitators can be found in the separate booklet supplied with the GAME.

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WHO SHOULD TEACH KAB?

Teachers/trainers who have been self-employed or have experience in starting or running a small business might be expected to be the best persons to teach the Know About Business programme. However, because the material presented covers the awareness level, no special background in small business ownership, management or instruction is required of the facilitator. It is recommended that the teacher/trainer read the entire Facilitators Handbook before the programme begins. A thorough familiarity with all the materials will greatly facilitate the achievement of the programme objectives. In order to teach KAB, teachers/trainers must first attend a training of facilitators seminar organized and conducted by the ILO or its accredited instructors/consultants. Thereafter, the facilitator must be certified by the ILO or its recognized institution. Men and women entrepreneurs might serve as guest speakers in the classroom to provide personal experiences in being entrepreneurs. Facilitator competencies As indicated above, a thorough familiarity with all the KAB modules and contents will greatly facilitate the achievement of the programme objectives. It would also provide the teacher/trainer with most of the key competencies required for teaching entrepreneurship at the awareness level, such as understanding the process of business development and recognizing the characteristics of successful entrepreneurs. Facilitators can increase their potential for being effective by seeking additional training to gain technical knowledge and to practise entrepreneurial skills. The possession of two other competencies would greatly enhance the effectiveness of the facilitator:

Ability to make use of enterprising teaching approaches Ability to encourage and inspire learners Ability to make use of enterprising teaching approaches

1.

Many differences exist between the conventional methods of teaching and enterprising teaching approaches. In the former, the learners adopt a passive role, leaving the active part completely to the facilitator. Enterprising teaching approaches, however, involve a participative style and an orientation towards learner action and learning by doing. The following provides a summary of the main differences between the two approaches.

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Aspect Actions Focus Trainer role Emphasis Trainee activity Ethos Trainee role Trainee expectation Sessions Topic Mistakes Trainee discretion Assessment View of the world Determined by... Staffed by... Aim

Conventional approach Content-driven Trainer-led Expert Knowing that Working alone Competitive Passive/receptive Dependence Programmed Imposed Should not be made Limited Exams/Tests Right/wrong Exam boards Subject expert Practice into theory

Enterprising approach Process-driven Pupil-centred Fellow learner/facilitator Knowing how and who Working in small groups Collaborative Active/generative Independence Flexible, opportunist Negotiated Are to be learned from Wide Profiles and results Uncertainty, shades of grey Local needs Cross-curricular team Theory into practice

(Adapted from Caird, S. and Johnson C. Some reflections on the meaning of enterprise. Durham University Business School, 1987) The following aspects about enterprising approaches to teaching should be particularly highlighted. (a) Learner-centered

The emphasis is on creating a learning environment where learners are assisted in:

identifying their interests learning by doing and interacting with others sharing experiences with other people Outcomes

(b)

In other words, learners should be actively involved throughout the learning process and encouraged to take responsibility for their own learning. In terms of outcomes, this means that learners are expected to:

learn how to learn identify learning strategies based on their needs

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express feelings gain self-confidence listen carefully and ask meaningful questions determine their own training goals face their problems make decisions develop plans and take responsibility for them develop standards for themselves be in control of their own learning

This does not mean to say that the learners can do whatever they like. If learners are not interested in something, they are encouraged to find something else in which they are interested. The facilitator and learners in the Know About Business programme are a team, and they should work together to achieve as much as possible for each team member. A supportive team atmosphere should be developed based on respect for each member of the group. (c) Application

As with other areas of enterprise development, to be effective entrepreneurship education calls for the application of knowledge in illustrating and cementing concepts. The facilitator needs to be able to relate activities to the needs, circumstances and profile of the learners. The more practical, the better. This explains the emphasis on learner exercises throughout the KAB package, as well as our earlier recommendation for extracurricular activity such as the setting up of business clubs, micro and small enterprises within schools/colleges. Incidentally, as suggested earlier, recognition of the importance of this practical activity requires directors or principals of education and training institutions to reward those involved in such activities, notably compensating the facilitators for their time and effort. (d) Variety

Multi-disciplinary teaching in a highly participative fashion requires stimulation to hold interest. The facilitator should therefore employ interesting and varied teaching methods to capture and hold attention. This calls for the use of audio-visual aids, technology (such as computers where available), different kinds of group exercises, as well as encouraging individuals to think creatively and work on their own initiative. 2. Ability to encourage and inspire learners

Entrepreneurship education is about developing entrepreneurial attitudes among learners, as much as anything else. This calls for a certain style or behaviour on the part of the facilitator in encouraging and inspiring learners towards success and achievement. The following may not exactly be a code of conduct; adoption of these suggestions will however help facilitators to stimulate achievement just as much as they inspire learners: 24

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Be enthusiastic! Entrepreneurship is fun as well as being useful. Believe in yourself. With good preparation, you can do it. Be a role model and a good one for that matter! Look neat, if not good appearances and impressions do count. Get to know your learners by name. Use their names and get the spelling right too. Be lavish with praise and be positive. Provide and obtain timely feedback. Reward appropriate behaviour in class. Sanction or correct in private, whenever possible. Identify learners who may need special help. Treat your learners as adults respect their views and interests. Make time for learners; do your best to help them; both in and out of the class. Be cheerful, joyful and smile these are catching traits!

Other training tips In addition to the above, if you want to improve your performance, the following tips will help you: (i) (ii) Assess your own performance after each presentation Ask yourself what went well and how it can be repeated

(iii) Examine difficulties that cropped up and how to resolve or avoid them (iv) Note important questions or issues raised and adjust the session accordingly

TRAINING METHODOLOGY FOR KAB

Effective facilitators vary their training technique often, even during a session. Lack of opportunity to express oneself inhibits learning and also generates boredom. In view of this, and also because it is important for learners to be actively involved in the learning process, a range of participative training techniques have been designed in KAB. These include: 1. 2. 3. 4. 5. 6. 7. 8. Presentation Group discussions Small group work Case studies Individual assignments Projects and mini-enterprises Brainstorming Role play 25

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9.

Guest speakers

10. Business games 11. CD-ROM

The methods are briefly reviewed below.

1.

Presentation

A facilitator presentation, or lecture, is the most commonly used method of teaching. It can be very useful to arouse interest among learners. It involves a transfer of information from one person to a group. Typically, interaction is confined to the end of the presentation and it is often limited to asking questions. When making a presentation, it is common to make use of visual aids such as flip charts, overhead projectors or multi-media projectors. Although various types of presentation exist, the most common type involves the presentation of a body of knowledge. The method may be used by both facilitator and learners. Key points are made which lead to some conclusions. Ideally, presentations should be kept short.

2.

Group discussion

Group discussions are commonly used as instructional strategy for exploring issues, solving problems and making decisions. A group discussion is one way to get a class to explore personal attitudes. Changes in personal attitudes can result from group discussions. A discussion should have a clear objective which should be maintained throughout the discussion. The atmosphere of the group should be relaxed, yet planned and organized. The group discussion should have a definite beginning, middle and end. For the discussion to be effective, there should be a free flow of learner opinions. The group discussion should be brought to a conclusion by a summary of the major points. A group member might be asked to do this. For learners, group discussions offer opportunities to:

exchange ideas and opinions reviewing key points determine their knowledge about a topic develop listening skills encourage them to take the responsibility for their beliefs express their attitudes, beliefs and behaviours in front of others help them to work cooperatively through a learning process

3.

Small group work

Small groups may be composed of about three to five members who work together for a short time to complete a task or to solve a problem.

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Here, learners are given a task to perform or a subject to discuss. The task can last for as little as five minutes or as long as a day, depending on the nature of the assignment. There are various reasons for using small group work:

learners can express their opinions freely learners interest is maintained learners are encouraged to take responsibilities for their own learning learners are actively involved.

4.

Case studies

Case studies are descriptions of actual or fictitious experiences used in teaching to illustrate or highlight a point. The use of case studies allows maximum learner participation in the educational process. Learners are expected to:

Discuss the elements of the case Assess the facts Make an analysis Weigh considerations and Make a decision.

The case study method is particularly useful for the development of the learners problem-solving ability. Through the use of case studies, learners gain insight into useful ways to reason and will discover patterns of critical thinking which will be productive in new and different situations. Facilitators are encouraged to develop their own cases and/or use others that are locally available.

5.

Individual assignments

Individual assignments are accomplished when each learner is given specific activities. These assignments should have clear objectives which can be evaluated. Individual assignments provide opportunities for learners to learn by discovery. Facilitators who use this method should select tasks that give learners a sense of responsibility for their own actions. Individual assignments are an important part of every course. Each individual assignment should have clear instructions for completion and have a specified time limit within which they have to be completed. Assignments should be assessed as soon as possible and feedback given to the learner. Some guidance on conducting interviews can be found below, under guest speakers.

6.

Projects and mini-enterprises

Projects are another form of assignment which might be accomplished individually or in a group. Generally-speaking, a project should result in a report which might include an analysis of facts, a discussion of options and recommendations to solve the specific problem. Recommendations might also include a clear strategy for implementing the solution. Projects may be used to give learners practice in a number of skills or topics already taught in class.

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Starting and running a mini-enterprise is a practical and exciting way of carrying out a project and, in the process, demonstrating and enhancing the concepts contained in KAB. This involves learners working as a team, choosing a business idea, planning and operating an enterprise, whilst in school. The facilitator acts as a consultant or business advisor.

7.

Brainstorming

Brainstorming is a technique used for creative problem-solving as well as for generating ideas. The object is to come up with as many ideas as possible. It usually starts with a question or problem statement. For example, you may ask What are the products and services needed in the home today which are not available? Each idea leads to one or more additional ideas, resulting in a good number.

When using this method, you need to follow these four rules: Dont criticize or judge the ideas of others Freewheeling is encouraged ideas that seem to be wild or crazy are welcome Quantity is desired the greater the number of ideas, the better Combine and improve upon ideas of others

Furthermore, all ideas, no matter how seemingly illogical or crazy, must be recorded.

8.

Role play

Role playing may be used to illustrate by drama the various aspects of an interpersonal problem. It is particularly useful for promoting understanding between different viewpoints, as well as demonstrating how people might react under certain conditions.

9.

Guest speakers

Guest speakers provide variety to a class setting. They can also serve as role models for learners. They could be subject matter experts, entrepreneurs or other figures in the community whose work pertains to the subject under discussion. To be able to make the best use of this resource, facilitators need to develop their own personal network of associations and institutions concerned with entrepreneurship and small business development. These might include

banks small business development/promotion agencies accountants lawyers community/local/regional development organizations non-governmental organizations churches

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local entrepreneurs government ministries employers' organizations trade unions

Here are some basic guidelines for conducting an interview, which facilitators should share with learners: (i) (ii) Make an appointment with the person to be interviewed, stating the purpose and the approximate time needed. Determine beforehand the questions to be asked. The questions may be a combination of open-ended, i.e. general questions, such as why and how the entrepreneur started his/her enterprise, and close-ended, i.e. specific questions calling for pre-determined answers such as yes or no.

(iii) Conduct the interview, with a note pad and pen ready or, if possible and the person does not object, using a tape recorder. Listen attentively and note down or record the answers to the questions carefully. Also, observe the environment and make notes accordingly. (iv) Analyse the information collected, send a thank you note to the person(s) you interviewed and summarize your findings and conclusions in a report.

10. Business games

Business simulation games provide the opportunity for learners to practise running an enterprise and experience the effects as though it were a real situation. In KAB, the ILO Game fits this role perfectly. Learners are divided into three teams that compete against each other. At the end of the exercise, the facilitator takes the learners through a reflective process, leading a discussion on what was learnt. Apart from the learning benefits, the game is great fun and, for most people, also novel. Facilitators are encouraged to develop or use other simulation games in addition to the one provided. (A facilitators guide for the GAME is delivered within the game package.)

11. CD-ROM
A CD-ROM interactive version of KAB has also been developed and is available from the ILO or its accredited agents. The software serves three main purposes: first, it constitutes an archive of the latest version of the training materials, background documents and references; secondly, it provides self-assessment tests and quizzes for facilitators; and thirdly, it contains video clips to illustrate concepts and support learning. For further information please contact the International Training Centre of the ILO or SEED at ILO Geneva.

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ASSESSMENT AND EVALUATION

Where KAB is offered within a vocational or technical training institution or other educational setting, the education or training authority may have its own methods of assessment and would almost certainly retain the final responsibility for quality control and standards. Equally, if KAB were introduced as part of a technical cooperation programme or project, the usual guidelines for programme/project design and evaluation would apply. In addition to, or in the absence of these, there are a few practical steps that could be taken to assess if learning objectives have been achieved1. First, facilitators could check learning by asking questions on the session to make sure that it has been understood. Different learners could be asked from time to time to summarize or do a prcis of the session. Secondly, the profiles and outcomes of specific assignments or projects (e.g. gathering information from entrepreneurs through interviews, market research, preparing a business plan, starting and running a mini-enterprise) could be graded and used. Presentation of the findings could be equally assessed. Facilitators should provide timely feedback in all cases. Thirdly, learners could be given questionnaires at the end of each module or after the programme to rate various aspects such as achievement of objectives, content, usefulness, etc., and to provide additional comments. Finally, it is good practice for facilitators to meet several times a year to assess the programme, examine what went well or what did not, and learn from experience with a view to improving delivery the next time round.

REFERENCES AND FURTHER READING

The following selected references are provided for facilitators and learners interested in learning more about entrepreneurship. It is by no means an exhaustive list. Those eager for more would find in these references, the Internet and elsewhere a rich and vast array of literature on the subject. 1. Please see the KAB CD-ROM (information available from the Global KAB Coordination/SEED at ILO Geneva and the International Training Centre of the ILO). Internet search, using a suitable search engine such as www.google.com or www.yahoo.com. Search under entrepreneurship, entrepreneurship education or other specific topics of interest. Global Entrepreneurship Monitor. See http://www.gemconsortium.org.

2.

3.

Impact assessment is, however, more complex; it requires a significant period of time after the training event (this could be 5, 10 or even 20 years) and involves sophisticated tools, such as setting up a control group to isolate effects.

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4.

Haftendorn, K.; Salzano, C. 2003. Facilitating Youth entrepreneurship. An analysis of awareness and promotion programmes in formal and youth education. ILO/SEED Working Paper No. 59, Series on Youth Entrepreneurship. Bahri, S., Haftendorn, K., (Editors) Towards an Entrepreneurial Culture for the Twenty-first Century. Stimulating Entrepreneurial Spirit through Entrepreneurship Education in Secondary Schools. UNESCO/ILO Manu, G. and Brown, R. 1987. Resources for the Development of Entrepreneurs: A Guided Reading List and Select Annotated Bibliography. Commonwealth Secretariat, London. McClelland, D.C. 1961. The Achieving Society. Van Nostrand, Princeton, NJ. McClelland, D.C. and Winter, D.G. 1969. Motivating Economic Achievement. Free Press, New York. Olm, K.W. and Eddy, G.G. 1985. Entrepreneurship and Venture Management: Text and Cases. Charles E Merrill Publishing Co., Columbus, Ohio.

5.

6.

7. 8. 9.

10. Timmons, J.A. 1994. New Venture Creation: Entrepreneurship for the 21st Century. 4th Edition. Irwin. Finally, entrepreneurship education is meant to be FUN. We suggest you re-read now and again the section above under Facilitator Competencies entitled Ability to encourage and inspire learners. Have fun and all the best!

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