The Consulting Program For Businesses with 5 employees or more

The Small and Medium Business Agency (SMBA)

History and Mythology• The Consulting Program, or in its previous name – the Business Mentoring program –

has been operating since 1993.• The program is governmental, and is operated by private subcontractors, that analyze

the needs of the various business and refer professional privet consultants to these businesses.

• The purpose of the program, is to improve the function of the business, make available tools and skills and improve the changes for survival of the business,

• The consultants are remunerated based on hours of work. The price is subsidies by the government that pays about 60% (in the past 70%) of the consulting fee, a fixed rate determined by the government.

• In 2011, a number of unique consulting tracks were merged into the program. These tracks were previously carried out in parallel tracks: innovations, international marketing, industrial design, and quality management in the industry. These programs are aimed at providing the business with tools to expand the business and do not necessarily concentrate on survival and crisis management.

• Currently, the only measurement is the feedback of the business owner and his/her satisfaction with the outcome. No quantitative analysis of a successful result is made.

The process

Refer privet

consultants

Prepare a work plan

Approve the

work plan

Implement the work plan

Analyze by coordinator

Work plan summary

and conclusion

Continua the mentoring

End of process summary

and conclusion

Consulting Businesses (5 employees or more)

Number of businesses that received consulting services

2011 2012 2013

1,0501,178

1,598

68,504 hours were allocated

Consulting subjects5-10

Employees10-50

Employees50-100

Employees Subject

40.7% 381 257 12 Finance & Management

21.8% 172 152 24 Marketing and Sales

16.1% 148 91 19 Organizational

0.8% 6 7 - Innovation

0.5% 4 4 - Industrial Design

1.4% 8 12 3 Export

0.1% - 1 - Foreign Currency Protection

0.4% 3 4 - Environmental

1.9% 6 6 19 Efficient Energy Use

3.3% 18 29 6 Standardization

8.6% 64 56 18 Operational and Logistics + Quality Management

4.3% 28 29 11 IT

838 648 112 Total

52% 41% 7%

78.6%

93%

Consultants• 845 approved private consultants in SMBA’s database

Main Field of expertise Number of Advisors in the database

Staring a business (83%)703Overall management & finances (49%) 414 Marketing and sales (60% )514Organizational (45% )381Operational and logistics 194Innovation and creativity 168Industrial design 253Export 101Foreign currency protection 39IT 84Environmental 37Standardization 28Efficient energy use 18

Main Challenges for business • Lack of short and long term planning that leads to:

Lack of cash flow planning Clear targets are not set in advance No business and marketing strategy No business vision

• Lack of information about the business and poor use of professional tools, which leads to:

Deficient pricing Lack of expense control No profit analysis Low level of control over productivity and efficiency measurements

• Lack of proficiency in management skills that lead to: Inefficient use of manpower and operations Failed communications with banks an other external entities Deficient sales and marketing efforts Lacking time management and resource allocation Erosion of business owner motivation and stamina.

Main Reasons for ApplicationsMost business owners apply for counseling services, when faced with unsatisfactory results or other similar symptoms. Business owners do not normally comprehend the source of these bad results or the reasons that bring them to the unfortunate circumstances.• Financial Problems:

Lack of cash flow Losses and low profitability Inability to manage finances.

• Business Development Difficulties: Decrease in sales Loss of customers/inability to recruit new customers Inability to cope with market changes and challenges.

• Manpower and Logistics Issues: Difficulties with recruitment/lack of skilled personnel Low efficiency and poor proficiency of staff.

Failures and Problems

• The long term affects of the program are low due to the relatively short consulting periods

• Insufficient number of good proficient consultants• Budget problems – availability and amounts allocated• Most business application initialized when the

business is already in grave difficulties• No long term follow up with the business after the end

of the consulting process• Lack of objective measurements

Evaluation and Measurement

• The effect of most consulting processes will appear only after a significant period of time

• Some of the products and improvements achieved through consulting services, concentrate around the “soft” part of the business – i.e. time management.

• Part of business improvements or failures are caused by external circumstances not connected to the consulting processes

• Some business owners refuse to present numerical business results, especially when requested formally and/or by a governmental agency or representative.

Thank You