2014 Queensland Small Business Week (September 1-5) was a busy time for ACE, with lots of external exposure and great networking. It started on the Monday with the high profile event “Are You a Business Tiger?”, organised by the Small Business Minister’s office, in QUT’s exquisite “Room Three-Sixty”. ACE Director, Per Davidsson, was one of the key presenters-panelists, along with Dhruba Gupta, Paul Niederer, Kit Kriewaldt and Emily Jade O’Keeffe. Per’s speech was one of “encouragement and caution” – based on research – in relation to canonising the most rapidly growing firms in the economy. The event was also streamed to over 700 participants in regions throught out Queensland. The Queensland Minster for Tourism, Major Events, Small Business and the Commonwealth Games, Honourable Jann Stuckey MP, closed the plenary part of the event. This was followed by roundtable sessions, many of which were facilitated by ACE and QUT Business School affilates, Paul Steffens, Rowena Barrett, Stephane Tywoniak, John Polichronis, Sukie Sawang, Sandeep Salunke, Tonis Mets, Julienne Senyard and Deb McGregor. Read more
Per Davidsson and Karen Taylor represented the Australian Centre for Entrepreneurship Research (ACE) at “the G20 Agenda for Growth: Opportunities for SMEs” conference, called by the general Small Business Minister, Bruce Billson, in Melbourne on Friday, June 20. The meeting was held in a very historic place – the Victorian Parliament – in the very room which also hosted the first federal parliament of Australia in the early 1900sAll important SME-related organisations were represented among the 100+ delegates, so it was an excellent networking opportunity for ACE . Per took the floor twice, summarizing stylized facts from research related to the conference theme, as well as their policy implications, and seems to have made an impression. The Minister impressed by attending in person for most of the day and we also got a chance to talk to him face-to-face and provide him with a set of ACE research vignettes, including this one, which was prepared specifically for this meeting. We are currently following up on the important contacts we made at the meeting. Read more about the meeting
Thursday 17 October 2013 5.45pm for 6pm start – 7.30pm
to be held at QUT Gardens Point: The OJW Room, Level 12, S Block
Brisbane is a great place to do business and the Business Excellence Roundtables will bring experienced facilitators and business owners together to help businesses to improve and grow. Running a small business is hard and sometimes lonely so why not explore how these groups of 8 to 12 business owners and professional business facilitators can help your buisness grow. Read more
This series of research vignette is aimed at sharing current and interesting research findings from our team of international Entrepreneurship researchers. This vignette – ‘Does firm location make a difference to the export performance of SME’s?‘, based on a research article from 2011 by Styles and Lawley, deals with export capacity of Australian SMEs. This collected data from an expert panel of government trade advisors, as well as managers of SME exporters in regional and metropolitan areas in Queensland.
ACE Director Per Davidsson has published a new book, New Perspectives on Firm Growth, together with Professor Johan Wiklund of Syracuse University, USA. The issue of how firm growth is achieved and managed, and what consequences it has for different stakeholders is both theoretically interesting and practically important. The book contains a series of studies that extend previous research by providing stronger theoretical underpinnings and using longitudinal databases that can separate in time the firms’ growth from its presumed causes. The studies also break new ground by examining the causes and effects of different forms of growth, such as sales growth vs. employment growth, and organic growth vs. acquisition-based expansion. Further, the studies take a critical look at under what circumstances high growth is associated with high profitability. Not least this latter issue is something that should be of great interest also to practitioners. The researchers’ main finding on this issue is that sound, profitable growth usually starts with attaining high profitability at lower rates of growth. Firms that expand at low levels of initial profitability do not generally become more profitable as a result of their increased size. Instead, these firms are often found to have low growth as well as low profitability in the period following a growth spurt.
ACE’s recent Global Entrepreneurship Monitor report received media coverage with CNN last week. Here is the opinion piece by Associate Professor Paul Steffens, deputy director of ACE:
Essentially the report outlines Australia’s impressive recent entrepreneurial performance. The full report can be found here:
What is GEM
In 2011, the Global Entrepreneurship Monitor (GEM) study was conducted across 54 countries. Over 140,000 adults aged between 18 and 64, including 2,000 in Australia were interviewed. GEM differs from other studies in that by surveying the adult population, it identifies entrepreneurs at the very earliest stages of new business creation.
- Australia’s entrepreneurship rate is second only to the USA amongst developed countries
- We estimate that 10.5% of the Australian adult population were actively engaged in starting and running new businesses in 2011. This equates to 1.48 million early-stage entrepreneurs
- Of the estimated 1.48 million early-stage entrepreneurs:
* 40% or 590,000 were women
* 33% or 580,000 expected to creates at least 5 new jobs in the next 5 years
* 11% or 170,000 expected to create 20 or more new jobs in the next 5 years
- Australia also ranks above average for employee entrepreneurial activity in established firms. An estimated 5.0% of the adult population is engaged in developing or launching new products, a new business unit or subsidiary for their employer.
- Australia was one of only three developed countries, together with the US and Netherlands, that ranked above average for both entrepreneurship rate and employee entrepreneurial activity
- Australia outperforms most other developed economies on indicators of the quality and economic impact of its business start-ups, including growth aspirations, number of opportunity-driven start-ups and innovativeness
- The vast majority of start-ups in Australia are founded based on a desire to take advantage of perceived opportunities with only 1 in 5 new ventures started through necessity –
- While the global economic slowdown (GFC) clearly increased the level of necessity driven entrepreneurship in Australia, this increase is not as strong as that experienced in the USA.
- Approximately 50% of the Australians believe that good opportunities exist for the establishment of new ventures, and that they possess the skills to start a business. This is well above international averages.
- International orientation is below average for Australian early state entrepreneurs, most likely due to the geographic distance to international markets
- Australian entrepreneurship is comparatively inclusive. For example, at 8.4% the female total entrepreneurial activity is second only to the USA.
Innovation is vital to advancing living standards and wealth creation. While innovation occurs in many guises, business plays a leading role in creating innovation and translating it into useful applications for the market. Business innovate when knowledge is commercialized, usually in the form of new products, services, processes or business models. Since Schumpeter suggested that large firms are more likely to innovate than their smaller counterparts, researchers and policy makers have examined this phenomenon. In SMEs there has been overwhelming evidence that innovation supports performance, however, the dynamics of this relationship remain ambiguous. This summary examines if networking really contributes to small firms’ bottom line. Read more
Many thanks to Dr Martie-Louise Verreynne, Sarel Gronum and Timothy Kastelle from the UQ Business School for their contributions to the ACE Research Vignette Series.
At the risk of becoming part of the budget reporting landscape, this media release from the Minister for Small Business makes interesting reading. Note that small business, rather than entrepreneurship is the ‘engine room’ of the Australian economy.
The Gillard Government will deliver a range of tax reforms and extend advice services to benefit Australia’s 2.7 million small businesses – the engine room of our economy.
As part of the 2012-13 Budget, the Government will provide $27.5 million to extend the highly successful Small Business Advisory Service (SBAS) program for a further four years to continue supporting small businesses with vital advice and assistance.
The Government will also introduce a loss carry back initiative in 2012-13 to provide tax relief to companies struggling due to the high dollar.
“Small business owners with good access to information, advice, knowledge and experience are more likely to grow their business and create jobs,” Minister for Small Business, Brendan O’Connor, said.
“The Australian economy is undergoing a significant transformation and many small businesses are under pressure.
“Currently, small companies which are making losses are unable to use those losses to reduce tax liability because they are not making enough profit to incur a tax liability.
“The introduction of the loss carry-back will allow businesses to also ‘carry back’ their losses, to offset past profits and get a refund of tax previously paid on that profit.
“In doing so, this reform will mean businesses can use their tax losses now – when they need to – rather than in the future when their businesses are performing better.”
The new loss carry-back is estimated to benefit around 110,000 companies in its first four years, of which its estimated around 90 per cent will be small businesses.
This important tax reform is in addition to other tax relief starting on 1 July for small businesses that will benefit companies as well as sole traders, partnerships and trusts.
“From 1 July, small businesses will be able to immediately deduct the cost of any new business asset costing less than $6,500, for as many assets as they purchase,” Minister O’Connor said.
“In addition, businesses will be able to write off assets costing $6,500 or more in a single pool (15 per cent in the year they are purchased, 30 per cent each subsequent year).
“We also recognise that for many small businesses their biggest asset is their car, ute or van.
“Small businesses will be able to also instantly write-off the first $5,000 of the cost of a new or used motor vehicle, from 1 July this year.
“This important measure builds on the Gillard Government’s strong record of management of the economy in the interests of working Australians and spreading opportunity right across the community.”
Mr O’Connor said the extension of the Small Business Advisory Service (SBAS) will help small business operators as well as those starting out with low-cost planning, management advice and assistance with applications for finance.
“Since it was introduced in the 2008-09 Budget, SBAS has provided over 354,000 separate advisory services to more than 187,000 small businesses around the country,” Mr O’Connor said.
“More than 90 per cent of users surveyed said they would recommend the service to other small businesses.”
Service providers will be invited to make submissions for future funding rounds, with applications assessed through a competitive, merit-based process. Funding for SBAS was due to end on June 30, 2012.
Under the funding announced in this Budget, the program will be funded on an ongoing basis.
The Gillard Government is also establishing the first Australian Small Business Commissioner who will be a point of contact for small business services and information.
Small business owners will also have access to the National Workforce Development Fund which supports training and workforce development in areas of current and future skills need.” (Statement Ends)
‘Service 2020’ is an Economist Intelligence Unit report, commissioned and sponsored by BDO. The report captures the views of 479 business leaders. Covering business-to-business and business-to-consumer models, the report explores how successful organisations have built and subsequently sustained excellent client service and, most excitingly, provides a blueprint for the prioritisation of service development opportunities.
The research findings fall into eight megatrends which will define service in the future.
- Global competition will drive up service standards
- Companies must maintain service standards in the face of the need for speed
- Organisations must learn to use the increased transparency brought by social media to their advantage
- Companies must use new sources and types of data to rethink the way they track and personalise their service
- Good employees will remain fundamental to good service but with technology as an enabler
- More organisations will outsource aspects of customer service to new kinds of specialists
- The rise of the mass affluent and other customer segments will force companies to find new product or service niches
- Customer expectations, including the purpose of the store, are evolving with new technology
If you would like to receive each of the megatrends as they are published, please email BDO at firstname.lastname@example.org.
The following story appeared in Brisbane’s Courier Mail Newspaper on April 2nd 2012. Written by Rob Kidd, the article was based on a seminar that Dean Shepherd presented for ACE on March 28th, and a subsequent interview.
FAILURE in some aspect of business is as inevitable as the taxman making his monthly mark on your payslip.
But, according to one expert, it needn’t be as depressing.
Dean Shepherd, an Australian who is professor of entrepreneurship at Indiana University in the US and an adjunct professor at QUT Business School, believes valuable lessons should be learned from failed ventures and even individual projects.
“Entrepreneurship is about the pursuit of opportunity. Opportunity only exists in environments of uncertainty, so if we’re pursuing opportunities there’s a high likelihood we’re going to get it wrong and fail,” he said.
“The assumption has always been that you can learn from failure and it will be automatic and instantaneous. (But) that negative emotional element impacts our ability to learn.”
Research from QUT’s The Comprehensive Australian Study of Entrepreneurial Emergence research project (CAUSEE), focusing on about 800 emerging business start-ups, found about half failed within two years.
However, only 12.9 per cent of those involved considered the failure a “negative” experience.
Mr Shepherd, whose own research was inspired by seeing his father’s family business collapse, sees failure as an “integral part of innovation”, and says people should be encouraged to have a go.
“Being wrong is just part of being an entrepreneur. You can’t be an entrepreneur or an innovative company and only hit winners,” he said.
A more extreme method companies used for analysing a failed project was holding a “funeral” or “post-mortem”, Mr Shepherd said.
“They’ll send out an invitation to the wake – it’s a chance for people to get together to say the project is dead, to reminisce about the good times, perhaps to console each other but perhaps also to send the message that it’s time to move on.”
Organisations, he said, would benefit from adopting an “anti-failure bias”.
“In other words, they pursue many projects realising that some are going to fail. But by doing that their mean performance actually increases, so the organisation as a whole performs well,” Mr Shepherd said.
“It’s not a bad thing for a society if we have a lot of failed businesses. What’s bad is if we penalise or stigmatise them so even if they’re in the best position to learn, they never try again.”