With growing preference for self-employment over formal work, many people from different backgrounds are thriving in business today.
With growing preference for self-employment over formal work, many people from different backgrounds are thriving in business today. Although some ended up in entrepreneurship because of passion, others were driven by the kind of training they received from institutions of learning. Critics, however, continue to express concern that much as business courses are becoming popular today, they are not a prerequisite to successful business investment. So, is formal business training in anyway necessary before starting an enterprise?
"Yes; businesses run by people who lack formal training tend to suffer as a result of owners being easily manipulated by other people. Their businesses can collapse after a short time, while owners with formal training have the necessary skills to construct budgets and business inventories that are needed to grow a business steadily,” says Dr Marvin Mbassana, a lecturer of economics at the University of Rwanda’s College of Business.
Dr Mbassana further explains that without this business training, naïve entrepreneurs fall victim to avoidable risks.
"Occasionally they buy into unprofitable investments. Well, business is about taking risks but these have to be calculated. Only business schools can establish such entrepreneurial minds,” he adds.
Likewise, Sylvia Uhirwa, the partnerships coordinator at Kepler Institute in Kigali, considers formal training a necessity for mastering laws and business principles that usually challenge young entrepreneurs.
"For instance, only formal institutions have the capacity to educate someone on the legal affairs in business. This also includes the kind of language business owners use when addressing their clients. In this case courses like procurement or sales management become essential in doing business today,” says Uhirwa.
On the other hand, she adds that business demands making constant projections to thrive in competitive markets but their precision depends on whether owners are professionally trained.
"It is a necessity because once you start a business, the possibility of meeting competitors along the way is inevitable. Necessary projections can help one beat competitors but for that to be successful someone needs enough business training,” she adds.
Formal training not a guarantee for success
Much as some people assume that business courses are enough to guarantee success as an entrepreneur, others feel that business accomplishment is more about timing and skills.
For instance, Ronald Wandira, a history teacher at Riviera High School, argues that a formal business course should not necessarily be the first option for an entrepreneur, but rather a proper business plan.
"There are many things to look out for before starting a business. Spending time in class learning theory consumes time that could have been invested in potential business projects. Besides, there are cases of individuals who take on business courses but just end up searching for jobs. I believe business is more about creativity,” he says.
Wandira, however, advises that formal business training should be considered when already established entrepreneurs seek to improve management skills or improve on the quality of their products.
"At some point when the business is expanding, you may need to enroll for a course in administration, management or supply chain to ensure that you handle all your business operations appropriately,” he adds.
However, research carried out at the University of Arizona and New York University found that people who receive entrepreneurship education perform better at running their own businesses although entrepreneurship education does not necessarily result into better start-up company performance.
Interestingly, the study found that the same people who are good at running their own businesses might also be the most interested in studying entrepreneurship. As a result, receiving entrepreneurship training and start-up company performance are correlated, but the education doesn’t cause the performance.
Other randomised experiments in Peru that focused on the effect of entrepreneurial training obtained mixed results. Entrepreneurs who received training showed higher sales, but did not have higher profit margins or attract more employees.
In Rwanda, however, as part of efforts to improve entrepreneurship skills, the government established the National Employment Programme (NEP) as a tool to strengthen the coordination of employment programmes through better planning, implementation and coordination from different stakeholders engaged in job creation. All these feed into the annual target of creating 200,000 off farm jobs for youth. While NEP targets to equip individuals with the desirable entrepreneurship skills through business training, those who produce good plans stand high chances of receiving funding for their projects.
Business people speak out
Although many people believe that training should be the first step in planning for businesses, some business owners feel that individuals should spend more time looking for capital than piling up theory in their heads.
Patrick Mizero, a hardware dealer in Kisementi, Kigali, is one of such people who insist that small businesses need to find enough capital in order to progress and this is where more effort should be put.
"Anywhere you go, start-up capital is a big problem and this varies depending on the type of business. Once you have secured this, a short business course is enough just to improve operations for an already established business,” says Mizero.
He adds that for start-ups, formal training should focus on feasibility studies to assess the business environments because this is the biggest challenge fresh entrepreneurs face.
"Where the business is established affects its profitability greatly. These are things which should be sought for in case someone needs to get formal business training,” he adds.
For Denis Nsanzamahoro, a filmmaker in Kigali, the bigger the firm, the higher the demand for formal business training, and as firms expand, they should be tasked to upgrade their business skills.
"You may start your business as a single person but as it grows the demand for maintaining proper accounts increases. Without formal business knowledge all operations would be affected,” says Nsanzamahoro.
Jacques Nkurunzinza, a trader in Kigali, insists that all successful enterprises at least demand minimum qualifications in a business course.
"People boast about being successful in business without papers but lack of minimum knowledge from school has caused many small businesses fail to progress. This is because as businesses expand, demand for more research increases and someone will have to hire those who received formal business training to cope,” says Nkurunziza.
It should be known that much as starting business demands creativity, the globalised economy demands professionalism in all aspects. Individuals with maximum business training therefore end up scooping most of the big tenders because they have broad knowledge on conducting business.
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Steps to take before choosing a career
To learn about job responsibilities, employment opportunities, and training or education requirements prior to pursuing a specific career, follow these steps to narrow potential career options:
Assess yourself: Each individual has different goals, talents, interests, and values. In other words, there are certain careers each individual should not pursue and others where they’d excel and be satisfied. Determine what you would enjoy and excel at by taking career assessments, receiving career counseling, and conducting thorough self-evaluation.
Make a list of potential occupations - After conducting some self-assessment, it should be apparent the types of careers you should pursue. It is not possible to pursue each one, so the list should be used to determine where to begin your career search. Select 5 or 10 careers and create a new list with these choices. When making your choices, select jobs that interest you, are recommended following career assessment tests, and ones matching your skill set.
Explore the options: Learn about each potential career after narrowing your list. Be sure to learn about educational or training requirements, job duties, employment outlook, annual earnings, and promotion opportunities. Information can be obtained from the Internet, but try to meet with a professional in each field to obtain in-depth details about each profession. If you not know professionals in these fields, contact willing participants and schedule informational interviews. However, you will probably find that you have relatives, colleagues, and school mates currently working in fields that interest you. During an informational interview, collect details about annual salary, employment prospects, and entry-level employment requirements. It’s not recommended to request employment during these interviews, but take advantage of networking opportunities.
Narrow down your list: Eliminate careers that no longer interest you after thoroughly reviewing each one. Many people become dissuaded from pursuing a career after learning about education requirements, annual earnings, and declining industry growth. Once you’ve become acquainted with each career, narrow your list to 1-2 options.
Set goals: After your list has been narrowed, establish attainable goals. You should be informed enough to establish short and long term goals. Typically, short-term goals can be met between 1-3 years and long-term between 3-5 years. It will not be easy reaching each goal, so be prepared to work hard, make adjustments when necessary, and remain committed. Goals are typically achievable when they’re defined, flexible, realistic, and attainable within a specified time period.
Create a career action plan: Once you’ve established career goals, begin developing a career action plan consisting of goals and specific steps to reach them. Additionally, career action plans contain possible obstacles, steps to address them, and resources that can be utilized when assistance is needed. This plan will clearly define how you will receive required training or education, obtain employment, and develop professionally once you’ve begun your career.
Obtain training: Obtaining required career training will probably consume the majority of your time and efforts as you pursue a career. Depending on the profession, you may be required to earn a college degree, complete vocational training, learn new skills, or complete an apprentice or internship.
Agencies
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Your say on starting a business
Alexandria Haidara, business owner
I hold a bachelor of arts in political science. For a good business, you need to do market research and a business plan before starting out. You also need to constantly educate yourself about business management and marketing. It is better to hire people with skills that you lack.
Erick Sibomana, an entrepreneur
At university I pursued education, but practised something I was more passionate about since my childhood, which was sewing dresses. I only relied on general knowledge but I have been able to enroll in a university again to study creative arts in order to advance my career.
Joselyne Rurangwa, a business woman
I am a university graduate with a bachelors degree in accounting. I believe my business has been able to grow because of the knowledge I got from school. It’s important for one to have an idea of how they want their business to be and how to manage it; all this comes with training.
Fred Muhire, a vendor
I didn’t get any training before I started selling clothes, and I haven’t failed to operate my business because of that. According to me all that matters is the initial capital and being financially disciplined. Besides, training is important if the business is big.
Anita Mbabazi, a sales person
I trained in marketing, but knowledge in accounting is required for any business to prosper. But everything depends on ones efforts and what they want to achieve.
By Lydia Atieno