MGT601 SME MANAGEMENT

Lesson 12 Short and Medium Term Issues for SME Policy Formulation – II

Chapter Learning Objectives  This lecture is a continuation of the lectures No. 9, 10 and 11 dealing with the short term, medium term and long term issues.  These issues are pre-requisites for forming a comprehensive SME policy.

Human Resource Development Human Resources Development (HRD) as a theory is a framework for the expansion of human capital within an organization through the development of both the organization and the individual to achieve performance improvement.

Human Resource Development….  HRD is the integrated use of training, organization, and career development efforts to improve individual, group and organizational effectiveness.  HRD develops the key competencies that enable individuals in organizations to perform current and future jobs through planned learning activities.

Challenges to SMEs One of the major challenges that SME have to face is the emergence of the knowledge-based economy. People must continue to innovate, change and upgrade. There is a need to nurture the entrepreneurial spirit and skill development for adopting innovative technologies.

Continued…….  The low-literacy level of our population poses an immense challenge to our competitiveness.  Training and Development

Government’s Efforts One aspect of the Government’s strategy is to strengthen non-formal skills and entrepreneurship development, to better prepare workers for employment and to improve population’s general capacity of self-employment.

Continued……. The government has established a number of institutions that impart training and skill development. These include:

Continued……..  Pakistan Institute of Management Science (PIMS),  Provincial Vocational Training Councils Authority,  Technical Training and Vocational Authority (TEVTA)

Continued…… Government Universities and various other support institutions have however remained rather passive regarding the shaping of human resource development for SME.

Continued……. Entrepreneurship does not breed in a vacuum. For a healthy, growing business environment, it is necessary to foster entrepreneurial culture in Pakistan, which goes beyond the inclination to trade in goods. Entrepreneurial skill development programs can boost the SME sector.

Technology Transfer and Up- Gradation Advanced technology plays a vital role in the  vertical integration and  further enlargement of the firm,  firm productivity enhancement.

Continued…… The government in its efforts to facilitate technology transfer for indigenous SME initiated a program with the United Nations Development Program (UNDP) to promote Technical Cooperation between Developing Countries (TCDC).

Continued……..  The government also set up a National Productivity Organization as a resource center and a research institute to enhance industrial and labor productivity in Pakistan.  Similarly, other organizations like;

Continued……  Pakistan Council for Scientific Industrial Research (PCSIR)  Pakistan Industrial Technical Assistance Center (PITAC)  Ministry of Science and Technology (MOST)

Technology up-gradation obstacles  Inability to acquire sophisticated testing equipment and R&D facilities. (SME see it as a financial problem).  Lack of skills/experience to operate high-tech machinery.  Insufficient information on technological cooperation opportunities.

Technology up-gradation obstacles…..  Lack information on target market quality requirements and lack of knowledge on how to achieve these quality levels.  Absence of appropriate metrology and testing equipment and related infrastructure as common facility centers.

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