Intro Jakarta

Improving Productivity, Quality, Competitiveness, Sustainability and Knowledge Capital with UNIDO PHAROS Software Suite
Empowering entrepreneurs with knowledge capital
and best continuous improvement practices for

profitability, competitiveness, capacity for trade, exports and investments, sustainable growth by
introducing basic IT tools for business performance

measurement, management and benchmarking Capacity Building Programmes, Tools and Results
Serge Golovanov,
PhD, Dipl.Eng., UNIDO International Consultant
Director, Enterprise Performance Improvement Centre

GOLEM IMS GMBH, Vienna, Austria
in partnership with
United Nations Industrial Development Organization, and International Centre for Science and High Technology by UNIDO, Trieste, Italy
Centre for Management of Innovation and Technology,

Jakarta, Indonesia www.win2biz.com www.unido.org
Definition of Small and Medium-sized Enterprises in EU
Category Middle Small Micro
Number of employees 50 - 250 10 - 50 < 10
Business Navigation: Measuring & Monitoring & Planning of Business Performance Results
Sailing to target destination
Target
(Promised Land)
Ideal path
Initial position
Sailing with navigation
Sailing without navigation

New technologies do not help reaching the target but can make failure impact more costly and severe!
(e.g. new engine, design or construction of the ship do not change the outcome )
MICRO AND SMALL ENTERPRISES IN BRAZIL

Status (informal):
10.3 million informal microenterprises (2005) 4.9 million formal micro and small enterprises (2002) Low competitiveness: only 2.4% of the Brazilian total exports are made by industrial SMEs (2003) High mortality: 49.4% cease business in two years
56.4% in three years

59.9% in four years
Sources: IBGE and SEBRAE
SME mortality rate after successful start-up is caused by inadequate capacity to manage business and its finances, uncontrollable losses and non- efficiencies unknown to management
Actual data by San Paulo Department of Statistics, Brazil: 5 billion dollars lost and 530 thousands jobs in the medium and low range of manpower are lost within one year in San Paulo State only. 1,000,000 businesses closed between 1990-2002 just in the State of San Paulo worth of 62 billion dollars in invoicing and consequent losses in taxes.
(Source: Newspaper O Estado de San Paulo, Economy and Business Section, 4th December 2003)
Similar situation exists in other developing countries lacking of official statistics.
Result: Most of SMEs are running life time experiment W i n or D i e !
Major reasons of SME mortality

(SEBRAE, BRAZIL)
1.
Mistakes in making business decisions by management based on inadequate assumptions and information, inadequate managerial skills Financial mismanagement and ineffective use of own or borrowed financial resources
2.
These 2 reasons constitute 65% of cases
The price of ignorance

(UK case studies, CoVE and MII, food industry):
Estimations of lost gross profit (GP) due to various inefficiencies, per annum
Enterprise Group 1 (GP 400,000): 54,900 Enterprise Group 2 (GP 3,000,000): 215,500
Average enterprise improvement results benchmarked after the Programme implementations reveal average inefficiencies:
Overall Productivity Increase (or value Added/person) + 9% Improved Efficiency + 18%
Improved Gross Profit

Reduction in Labour cost Overall Effective Efficiency increase Acceleration of business development
+ 25%
- 15% + 5% - 6 years
UNDO Integrated Programme for Colombia, 2002-2004, Component II Quality and Productivity in 4 industrial sectors, 40 enterprises (leather & shoes, electronics, textile, metal processing)
Common situation in SMEs performance and capacity for innovation management

Enterprises are not managed with high efficiency, available resources are not used up to full potential. Innovations and globalization impacts cannot be managed effectively There are no simple & inexpensive educational IT tools for entrepreneurs for measuring / benchmarking of business results, simulating major decisions and developing knowledge capital after successful start-up.
Key issue:
Developing basic knowledge capital improving control and transparency of business and recognizing achievements in capacity for trade, exports, investments access to markets complying to new credit risk standards.
When major decisions are based non on assumptions, but realities and multiple uncertainty factors & risks are taken into consideration the chance of strategic failure or miscalculation decreases significantly.
Continuously improving business based on its measurement
Components of UNIDOs Enterprise Business Performance Management Solution
Software Suite Pharos Business Navigator Produce Plus
Training Course Vienna or any European location In country regional industrial center
Certification Enterprise Professionals Benchmarking
Client Support & Consulting on-site

Software Installation Data collection & entry, Biz target setup Reports, Export-import Measuring & Improving Business: Developing best practices
Financial Improvement Toolkit
The UNIDO Upgrading Programme Content
1. Awareness seminars, selecting of enterprises 2. Training courses for SME management (5 days, < 24 persons per group)
The Programme Components: Software

3. UNIDO Pharos Suite introductory software tools for Business
Performance Measurement & Management & Benchmarking

(min 2 licenses per enterprise for general and production managers)
Programme components: on-site consulting & support

4. Training and certification of clients support team 5. Transfer of know-how, methodology to Enterprise Management, setting best continuous improvement practices
(up to 12 months, 1 consultant support up to 10 enterprises, installing software, data collection, business targets, decision support, results measurement, etc).
6. Final results evaluation and reporting, conference
UNIDO Performance measurement tools: B u s i n e s s
Benchmarking Report
Key performance indicator improvements at a glance by summary performance graph
Key Business Indicators time-series in benchmarking module
Improving Productivity, Quality, Competitiveness, Sustainability and Knowledge Capital with UNIDO PHAROS Software Suite UNIDO Performance Measurement tools: Pharos Business Navigator (main menu)
UNIDO Performance Measurement tools: Produce Plus (main menu)
Produce Plus
UNIDO Performance Measurement tools: Financial Improvement Toolkit
Produce Plus
Expected Results
Improvement of Key Performance Indicators (KPI) ~ 10% - 24% in average, e.g. Gross Profits, Productivity (Added Value per Employee), etc.
Benchmarking & diagnostics reports for each enterprise Documented Upgrading Programme results Benchmarking data for evaluation of sectoral performance Investment facilitation due to increased transparency of businesses
Personal UNIDO Certificates for Enterprise Management

Improved culture in management of business performance and innovations, sustainability, competitiveness, productivity and quality
Compliance to BASEL II standard
Enterprise Model of Training Programme Efficiency

(net profit only)
Average annual sales, USD Net Profit average % (shoe production factory) Increase of net profits, post programme % Increase of net profits, post programme, USD
- $632 000 - 5% - 24% - $7,584
Practical solutions
Capacity building programmes enhancing regional business support / consulting organisations in country with knowledge, best practices and UNIDO Pharos IT tools Certification of entrepreneurs acknowledging achievements in best practices, improving knowledge capital, productivity, quality, competitiveness, capacity for managing innovations, investments, trade & exports. UNIDO suite for each female & male startup entrepreneur with license fee ~ 150 Euro
(complete set of software & reference materials ensuring self-training, education and best practices).
1. The practical instruments exist and proved 2. The cost of improvements in business culture, knowledge capital, competitiveness, productivity and sustainability is reasonable & unique compared to any existing options. 3. The results are measurable and documented.
Input:
< N, 000 EURO per enterprise
Training Programme with or without on-site support <12 months
Output:
Measurable increase of major indicators including net profits, productivity, etc.
The total enterprise service package price depends on the Programme duration, national consultants salaries in country, number of participating enterprises and some other factors
Implementations: international programs and events

UNIDO Pharos Training Workshop Measuring, benchmarking and managing industrial enterprise with UNIDO Pharos Software Suite", ICS-UNIDO, Ministry of Research and Technology (MoRT), Centre for Management of Innovation and Technology (MIT), Jakarta, Indonesia 31 July 4 August 2006. Presentation Upgrading programmes improving SME capacity to cope with globalization and other challenges by using UNIDO information technology tools, methodology and best practices: sharing the experiences and results at 3 -rd India Global Summit on SMES organized by Confederation of Indian Industry (CII), Ministry of Small Scale Industries (SSI), Government of India, Delhi, November 2005. UNIDO Pharos Training Workshop Measuring, benchmarking and managing industrial enterprise with UNIDO Pharos Software Suite", UNIDO, Vienna, Austria, 5-9 Dec. 2005. Presentation Improving productivity, quality, competitiveness and sustainability of SMEs by applying UNIDO IT solutions for business performance measurement, management and benchmarking at World Association of Small and Medium -sized Enterprises Convention WASME 2005, Bucharest, Romania, May 2005. Meeting & presentations Applying UNIDO IT solutions for business performance measurement, management and benchmarking to capacity building and upgrading of entrepreneurs during official state of Dr. Schuessel, PM of Austria visit to China, April 2005 (Peking, Shanghai, Nanjing). Presentation Improving business results by applying UNIDO IT solutions for business performance measurement, management and benchmarking for Industrial Committee Meeting of the Chamber of Commerce & Industry of Eastern Province, Dammam, Saudi Arabia, April 2005. Meetings and presentations Applying UNIDO IT solutions for business performance measurement, management and benchmarking to capacity building and upgrading of entrepreneurs during state visit of Dr. Fisher, President of Austria to India, Feb.200 5 (Delhi, Hyderabad, Bangalore, Mumbai). Small & Medium Enterprises International Conference & Exhibition, Dubai, UAE by INSME and Department of Economic Development Government of Dubai, Emirates Bank, UAE, 31 Jan. - 2 Feb. 2005. Presentation at the Business Symposium "SMEs Competing in a Knowledge Economy", 2 OECD Ministerial Conference, Istanbul, Turkey June 2004. Recognition of Knowledge Capital in Knowledge Economy UNIDO Programme for Palestine Improving Business Performance by Introducing Continuous Improvement Practices Based on UNIDO Business Performance Management Software, August November 2004. UNIDO Upgrading programme Measurement for continuous improvements in quality, efficiency, productivity, competitiveness by UNIDO, Association of Lebanese Industrialists (ALI), Euro-Lebanese Center for Industrial Modernization (ELCIM), Lebanon, June October 2004.
Implementations
The UNIDO/IMC workshops "Application of UNIDO benchmarking and business excellence tools for enterprise upgrading, strategic and production management, IMC/UNIDO workshops, Cairo/Alexandria/Borg El Arab, Egypt, February - April 2004. 2nd INSME Association Committee Meeting, 25th of February in Malm, Sweden. INSME THINK TANK, The International Network for Small and Medium Sized Enterprises, Rome, Italy, 11th -12th December 2003. Presentation of UNIDO Business Performance Management Products and its application in upgrading programmes at the UNIDO Conference Improving Efficiency of Companys Business through Implementation of TQM/EMS, Moscow, Russia, 1314 October 2003. The results and experiences of bringing continuous improvement know-how and UNIDO business performance information technology tools to industrial entrepreneurs, presentation at the Forum by UNECE, UNDESA, ILO, UNAIDS, UNICEF, UNDP Youth of the XXI Century:Realities and Perspectives, 24-26 September 2003, Kyev, Ukraine The UNIDO workshop "Strategic and production management of industrial enterprise: application of UNIDO benchmarking and business excellence tools Pharos + Produce-Plus", UNIDO ITPO/ARCEIT, Jan. 2003 Manama, Bahrain UNIDO Integrated Programme for Colombia, Component II, Improving Quality & Productivity in Leather, Electronics, Metal Processing, Textile sectors by applying continuous improvement, workshops and implementations in Bogota, Barrancabermeja, Ibague and Pereira, Colombia, 2002 2003. Presentation UNIDO Business Performance management tools for entrepreneurs at E4PQ: Regional Forum on eProductivity and Quality by UNIDO, 21-23 Nov. 2001, Warsaw, Poland, UNIDO Industrial Upgrading Programme, Pharos Training Workshop, UNIDO, Ministry of Industries and Palestine Federation of Industries, Ramallah, Palestine, July Oct. 2001 UNIDO Workshop and upgrade programme Application of Quality Principles to The Leather Production Sector in Egypt, April 2001, Cairo, Egypt UNIDO Training workshop for national consultants Application of Quality Principles to The Food Processing Sector of 7 SubSahara African Countries with UNIDO Business Excellence Software, July 2000 and on-site installations in Kenya, Uganda, Tanzania, Zambia, Ethiopia, and Zimbabwe. UNIDO Workshop: Training of Trainers on UNIDO Business Excellence Software July 2000, Kenya, Uganda, Tanzania, Zambia, Ethiopia, and Zimbabwe. UNIDO Upgrading Programme Strengthening of Small and Medium automotive component suppliers to deliver export quality products in India, Nov. 1999, New Delhi, Pune, Bangalore, Mumbai, Baroda, Nashik, Ahmednagar, India. UNIDO Training Workshop Facilitating Sustainable Industrial Development and Competitiveness by Applying UNIDO Pharos IT tools for entrepreneurs, Oct. 1999 Siktivkar, Republic of Komi, Russia
Improving Productivity, Quality, Competitiveness, Sustainability and International customer list Knowledge Capital with UNIDO PHAROS Software Suite
Bahrain UNIDO ITPO/ARCEIT office, Manama Bulgaria BUSINESS CENTER & INCUBATOR ISKAR Ltd., Sofia HIRON Management Consulting Ltd., Sofia Colombia De Williams Servicios, Barrancabermeja ELECTROTCNICOS, Barrancabermeja IMSOL, Barrancabermeja INDUSTRIAS PALMIRA, Barrancabermeja MEC LTD., Barrancabermeja METALMAQ, Barrancabermeja METALTEC, Barrancabermeja METCOL, Barrancabermeja REYMOM, Barrancabermeja TALLERES UNIDOS, Barrancabermeja Boston Shoes, Bogota CALZADO ATLAS LDTA, Bogota Curtiembre el Reno ltda, Bogota Esmeralda Leather, Bogota Henry Mouse, Bogota IMACAL De CALZADO Manufacturera, Bogota Industria de Calzado Soani Ltda., Bogota Manufacturas en Cuero V & C Ltda, Bogota Confecciones Caribean S.A, Ibagu Confecciones Cathy Ltda., Ibagu Confecciones Mershy Collection, Ibagu Ibis S.A, Ibagu
Industrias Titanic, Ibagu Outsoursing Industrial, Ibagu Plano y Punto Ltda., Ibagu Root & Co Kids Ltda, Ibagu Serviconfeccin, Ibagu Sheffy Sports, Ibagu Basculas Prometalicos, Manizales CI Plastigoma S.A., Manizales Conelec S.A, Manizales Sinterizados S.A, Manizales Cable Link de Colombia S.A, Pereira GL Ingenieros Ltda., Pereira Industrias de Cables y Partes, Pereira Magom Electroinica, Pereira Normarh Ltda, Pereira Integrando Ltda., Pereira Dosquebradas
Chile Universidad de La Frontera, Temuco Egypt Cairo Intl for Leather Industries Short Shoe Factory Baramki Group Cairo Industry For Leather and Chemicals Arto M Co. Ramadan Chehata Sons Factories Condor Footwear Leather Technology Center FLISC, UNIDO Ministry of Industry and Technology TCAE 2 M Shoes Company ASI-Egypt
Wonder Foods products Glacier Products Ltd. Kuwait Arab Planning Institute, Shuwaikh India Vir Rubber Products, Mumbai Standard Radiators (metal-radiators producer), Baroda Zylog Plastalloys Ltd, Nasik Manikprem Industries, Ahmednagar, Engineering Plastics, Pune ACMA Technical Centre, Delhi Federation of Indian Chambers of Commerce & Industry (FICCI), New Delhi Power & Energy Development Centre, Bangalore UTISTA Management Consulting, Bangalore OPTIMA Systems Ltd. Siemens Business Services GMBH, Russia Palestine UNIDO Integrated Programme for Palestine Birzeit Pharmaceutical Company NBC-Cocacola ASI- Egypt Pharmacare PLC Sinokrot Food Co Al Haya Food Co. Jerusalem Pharmaceuticals Nassar Invest. Co Ministry of National Economy Gama Pharmaceutical Flefel Co. Russia Center for Executive Education, Siktivkar State University ENIGMA Training and Constructions, Ltd Serbia VING Doo, Novi Sad.
Lebanon Joseph B. Amatoury s.a.r.l Oriental Paper Products Kfarshima General Packaging Industries Cortas Canning & Refrigeration Company s.a.l. TANMIA
Saudi Arabia Plastic Production Components
OPTIMA Systems Ltd. Siemens Business Services GMBH, Russia Slovakia Industrial Management Consulting s.r.o, Bratislava Melli Interiery, s.r.o., Bratislava Sri Lanka University of Kelaniya, Kelaniya Sudan Solutions Company Ltd., Khartoum Thailand Thai Pharos Software Company Ltd., Asian Institute of Technology, Turkey USEGO Consulting, Istanbul Zambia Eureka Chickens Ltd. (Zambia) Meatland Ltd, Lusaka (Zambia) Uganda Hwan Sung Ltd., Ngege Ltd Uganda Fish Packers Greenfields Limited
United Kingdom Centre of Vocational Excellence, The Humber Institute of Food and Fisheries, Grimsby, Manufacturing Improvement International Ltd., Grimsby, N E Lincolnshire Hull University MSc Food Standards Science Disposables UK, Ltd. Vickers Laboratories Ltd, Graftons Bakery Ltd. Yorkshire Farm Bakery Ltd Riverside Food Services Ltd. Wensleydale Creamery Ltd. Smales Fish Merchants Ltd. Regal Fish Ltd Kwoks Ltd. Healthfresh Ltd. Bleikers Smokehouse Ltd. Food Design Ltd. Shepherds Purse Ltd. University of Wales Institute, Cardiff
C o n c l u s i o n s:
1. Most of industrialists do not have sufficient capacity & knowledge for implementing performance management tools and practices to monitor and measure their businesses, optimize decisions, eliminate inefficiencies systematically and maximize use of available resources. 2. The Training and Upgrade Programmes for SMEs introduce best continuous improvement practices and UNIDO IT tools facilitating productivity, competitiveness, quality, sustainable growth in areas where real and tangible improvements can be made. 3. SMEs become much more transparent and attractive for national and international investments, improve capacity for trade and exports.
4. The Training Programmes facilitate entrepreneurs capacity building in introduction and managing of innovations, new technologies.
C o n c l u s i o n s (cont) 5. The Training Programmes complement and facilitate business developments, managerial capacity and potential, including path to ISO 9000, WTO requirements, decreasing SME mortality. 6. The Training Programmes deliver unique content and provide comprehensive package of services at acceptable cost level resulting in important Knowledge Capital Gain. 7. Governmental and international support of the Training Programs is an effective way to boost economic performance and sustainability of industrials sectors in regions. 8. The programme results are measured and documented providing vital economic and industrial statistics to organizers and donors.
Contacts: Enterprise Performance Improvement Centre GOLEM IMS GMBH, Vienna, Austria Official UNIDO partner in development, distribution and implementation of capacity building programmes based on UNIDO IT solutions for enterprise performance management, measuring and benchmarking in developing countries www.win2biz.com e-mail: info@win2biz.comd
Member of INSME Association
Official partner of UNIDO for international distribution, consulting and training for UNIDO Business Performance Measurement, Management and Benchmarking Software

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Intro Jakarta

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Improving Productivity, Quality, Competitiveness, Sustainability and Knowledge Capital with UNIDO PHAROS Software Suite

Empowering entrepreneurs with knowledge capital

and best continuous improvement practices for

introducing basic IT tools for business performance

Director, Enterprise Performance Improvement Centre

Centre for Management of Innovation and Technology,

Definition of Small and Medium-sized Enterprises in EU

Category Middle Small Micro

Number of employees 50 - 250 10 - 50 < 10

Sailing to target destination

Sailing with navigation

Sailing without navigation

MICRO AND SMALL ENTERPRISES IN BRAZIL

56.4% in three years

Similar situation exists in other developing countries lacking of official statistics.

Result: Most of SMEs are running life time experiment W i n or D i e !

Major reasons of SME mortality

These 2 reasons constitute 65% of cases

The price of ignorance

Improved Gross Profit

Common situation in SMEs performance and capacity for innovation management

Continuously improving business based on its measurement

Components of UNIDOs Enterprise Business Performance Management Solution

Software Suite Pharos Business Navigator Produce Plus

Certification Enterprise Professionals Benchmarking

Client Support & Consulting on-site

Financial Improvement Toolkit

The UNIDO Upgrading Programme Content

The Programme Components: Software

Performance Measurement & Management & Benchmarking

Programme components: on-site consulting & support

6. Final results evaluation and reporting, conference

UNIDO Performance measurement tools: B u s i n e s s

Key performance indicator improvements at a glance by summary performance graph

Key Business Indicators time-series in benchmarking module

UNIDO Performance Measurement tools: Produce Plus (main menu)

UNIDO Performance Measurement tools: Financial Improvement Toolkit

Personal UNIDO Certificates for Enterprise Management

Compliance to BASEL II standard

Enterprise Model of Training Programme Efficiency

- $632 000 - 5% - 24% - $7,584

Training Programme with or without on-site support <12 months

Implementations: international programs and events

Saudi Arabia Plastic Production Components

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