1. Effects of the Strategy of economic growth on small and medium enterprises Karel Havlíček January 2006

2. Ing. Karel Havlíček, Ph.D., MBA Vice President UEAPME UNION EUROPEENNE DE L’ARTISANAT ET DES PETITES ET MOYENNES ENTREPRISES EUROPEAN ASSOCIATON OF CRAFT, SMALL AND MEDIUM-SIZED ENTERPRISES Vice-Chairman AMSP CZ Director M&S Strategy SINDAT GROUP

3. Contents Opportunities and threats for small and medium enterprises in the Central Europe The most critical factors of growth of the small and medium enterprises

4. Environment for the small and medium enterprises in the EU Strengths Stable environment (safety, economy, law) Consumer and commercial demand Technological facilities Tradition of business conduct High level of education Strengths Stable environment (safety, economy, law) Consumer and commercial demand Technological facilities Tradition of business conduct High level of education Weaknesses EU = social and expensive state Hyper-competitive environment Different territories (culture, history, language) Low level of mobility of labour Lack of marketing and trade Weaknesses EU = social and expensive state Hyper-competitive environment Different territories (culture, history, language) Low level of mobility of labour Lack of marketing and trade Opportunities New EU countries:trade and investment Brand products Products with application Growing consumption of businesses and consumers Open resources of workforce Opportunities New EU countries:trade and investment Brand products Products with application Growing consumption of businesses and consumers Open resources of workforce Threats Steady rise of costs Growing competition from Asia Transfer of manufacturing to Asia High level of bureaucracy Threats Steady rise of costs Growing competition from Asia Transfer of manufacturing to Asia High level of bureaucracy

5. Factors of economic growth of the small and medium enterprises "People are competitive advantage, neither price nor product" It is necessary to: provide, manage, and educate human resources PEOPLE Human resources development PEOPLE Human resources development

6. Factors of economic growth of the small and medium enterprises "Change is a way out of the hyper-competitive environment" Change of products, processes, communication, and relations (from 4P to 4C) IDEAS Research, development and innovations IDEAS Research, development and innovations

7. Factors of economic growth of the small and medium enterprises "Flexibility is a starting point of reduction of product life cycle" Flexibility of decision-making, labour, adaptation, and territorial change AVAILABILITY Infrastructure AVAILABILITY Infrastructure

8. Factors of economic growth of the small and medium enterprises "Accurate and timely information is a basis of managing financial resources" Information on bank, private, public, and European funding resources MONEY Sources of financing MONEY Sources of financing

9. Factors of economic growth of the small and medium enterprises "Partnership and respect between State and entrepreneur is the only way towards mutual prosperity" The State has to understand that the company is its customer. The entrepreneur has to respect that the State is its stakeholder. PLAYGROUND Institutional environment PLAYGROUND Institutional environment

10. Contact Karel Havlíček Karel.Havlicek@sindatsro.cz www.ueapme.com