According to the Human Capital Institute, talent management is best seen not as a set of topics, but as a perspective or a mindset. A talent-management perspective presumes talented individuals play a central role in the success of the firm. All corporate issues are seen from the perspective of ‘How will this affect our critical talent?’ and ‘What role does talent play in this issue?’

Small and medium enterprises (SMEs) face the same fundamental talent issues that large firms do. They need to attract, select, motivate, deploy, develop and retain talent. However, SMEs face some particular constraints that are more pronounced in the smaller firms.

A major premise underlying the success of any entrepreneurs lies in their recognition that purchasing is a critical process and makes as important a contribution as manufacturing, marketing, or engineering to the pursuit of a firm’s strategic objectives. Progressive firms have little doubt about purchasing’s impact on total quality, cost, delivery, technology, and responsiveness to the needs of external customers. The question to be addressed is what firms must do to achieve a competitive advantage from their procurement and sourcing processes.

Realizing these advantages requires shifting our view of purchasing from a tactical or clerically oriented activity to one focusing on strategic supply management. Strategic supply management involves developing the strategies, approaches, and methods for realizing a competitive advantage and improvement from the procurement and sourcing process, particularly through direct involvement and interaction with suppliers.

SMEs face unique challenges, which affect their growth and profitability and hence, diminish their ability to contribute effectively to sustainable development. Various challenges faced by SMEs including lack of innovative capacity, lack of managerial training and experience, inadequate education and skills, technological change among others results into various constraints in their operations.

It is a fact that using SMEs brings clear benefits. However, there are also a number of barriers that need conscious effort by those in the top tiers of the organization supply chain if they are to be overcome. Engaging SMEs usually means changing the way in which you deliver your procurement. SMEs are as a rule smaller, carry lower levels of insurance, may not have mature business policies and procedures, and may be put off by overly complex tendering processes. But by making small, manageable changes and carrying out some basic supply market analysis against your spend profile and categories, there is a high probability that you can actively include more SMEs.

From the perspective of a large organization, the main barriers to engaging with SMEs are usually a consequence of a lack of knowledge and information, including:
•     Understanding what companies exist in the local area;
•     Understanding when to contact these companies to allow them to participate effectively in procurement exercises;
•    Understanding how to use the best tools to contact these companies (other agencies, face-to-face events, press and multi-media advertisements etc.).

At the other end of the spectrum, the two main barriers for SMEs are:
•     Not having access to information about what is being bought and when (at first or second tier), meaning that an SME cannot participate or compete at the right times;
• Facing procurement processes and paperwork that are unnecessarily bureaucratic; an SME may not understand how to demonstrate compliance or how to market their services or competence in the first procurement stage, and therefore may never have the chance to progress to the full tender stages
Addressing these barriers requires strategic approach which may include the following:
•     For services or works contracts, where possible change the specification to a more “output” based structure. This gives more scope to the bidder to describe an outcome rather than respond to a more prescriptive specification based on what has been done on previous contracts.
•     If the contract is awarded to a new SME, ensure that they have a close relationship with you or are assigned a mentor to ensure delivery of both the specific contract obligations and any more general business development requirements set out in the contract.
• Due to lack of mature business processes and procedures, assign a mentor to the successful SME to help them to develop their processes and procedures.
•     In the tender, allow SMEs to submit “action plans to create procedures” in place of the completed procedures themselves, if they have not been fully developed.
•     Ask SMEs to explain their approach, or give them a policy statement against which they have to agree to deliver.
• If it is not really required for a specific work package, develop an appropriate bid bond threshold that may draw more responses from the SME market.
•     In the tender, allow for alternative proof of credit history or financial stability such as references from a bank or copies of management accounts rather than audited accounts.
• As above, use a dual rather than a single source approach to spread the risk and minimise the chance of supply failure.
• Allow bidders to propose the use of associates as well as directly employed staff and assess the tender returns based on individuals’ experience and competence to deliver the job rather than that of the company.
•    To avoid lack of knowledge about tendering process, Publish information about your tendering process on your website.
• Create a “How to supply” section and populate it with relevant information.
• Provide guidance on how to tender and your expectations in terms of levels of accreditations, experience etc.
• Host SME bid writing seminars to offer advice and support if asked. SME doesn’t know how to get their “foot in the door”
• As above, use your website to publish relevant information and contact details of local business support agencies if any.
• Communicate upcoming contract opportunities to business support agencies so that they can inform the wider SME community and/or local SMEs.
• Ask first tier contractors to sign a (voluntary) SME engagement code.

However, the direct actions of the top management team are not enough. A talent mindset must be driven through the organization. There are two most important ways to do so. One is to lead by example, which is necessary but not sufficient. The other is to hold managers accountable for good talent-management practices.
Meeting budget is no longer good enough: managers must demonstrate they are bringing top talent into the organization, retaining that talent, and developing that talent.

All in all, SMEs have fewer resources to throw at talent management yet face greater risks than large firms. These are not crippling problems, but it does mean SME’s have to be particularly thoughtful about talent management. SMES also have important advantages that can make them the envy of larger firms.

The review of the development strategies for our SMEs should be done with the aims to help them strengthen their business competitiveness. SMEs should be encouraged to invest in skills upgrading, new technologies and innovative processes, and to tap on the various schemes available to step up productivity improvements. The Government should enhance their support to SMEs in their move to intensify their business transformation to achieve quality growth. Further, the Government should enhance support for SMEs in the areas of productivity, innovation and capability upgrading. This will help SMEs boost their capabilities, restructure their business and remain competitive.

Vincent Ogonjo is a Procurement Practitioner at Strategic Supply Chain Consultants.
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Mr President; The Media is NOT an Enemy

Mr President; The Media is NOT an Enemy

Since time immemorial, the relationship between the state and the media has always been one of love hate. In times when the media is perceived to dance to the tune of the state, the relationship is love. But if the media is somehow seen to be anti-establishment, the relationship is hate.In Kenya, this also plays out but more often than not the relationship between the Kenyan media and the state is that of hate. Consecutive governments since independence have always viewed the mainstream media with contempt. To the government of the day, the belief is that the mainstream media is always anti-establishment and pro-opposition.Tragically, the Kenyan media is dominated by three main daily newspapers in terms of readership and around five television channels in terms of viewership. About 10 radio stations compete for listenership. Because these few dominate the media scene, they are the cause the government of the day loathes the media to a point where both the president and his deputy believe newspapers are only useful when wrapping meat.But Mr President, we want to remind you the Kenyan media is much bigger than your few perceived enemies. When you isolate the mainstream media, there is a big media industry that serves niche markets and employs hundreds of Kenyans. The alternative media, which include business, lifestyle and sports magazines, community-based radio and TV stations and others, are mediums that communicate to millions of Kenyans by addressing specific needs of their audiences.SMEs Today Magazine, for instance, is a monthly publication that is committed to identifying small and medium enterprises and giving them a platform to share their successes, challenges and aspirations. In doing so, the publication helps to drive the growth of the SMEs sector which with no doubt is the cog of the economy. For the government, thus, to brandish the whole media industry as anti-establishment and decided to starve it of advertising support is, to say the least, unfortunate. The decision by the government to establish a weekly publication called MyGov and direct all ministries, departments and agencies to only advertise through MyGov was the worst. While the justification was to save revenue, with the covert intention being to punish mainstream media for their so-called anti-government conspiracy, the reality is that the directive is killing responsible alternative media like SMEs Today Magazine. Without advertising support from the government, its ministries, departments and agencies, this publication and its peers are struggling to survive.Mr President, MyGov is not hurting the perceived enemies which ironically are getting paid for distributing the publication. To the contrary, it is killing responsible publications serving niche markets and playing a crucial role in the development of this country. This is not a call for the abolishment of MyGov. This is a plea that just as the Head of Public Service Joseph Kinyua issued a directive that all government advertising should be done through MyGov, he should issue another directive telling ministries, departments and agencies they are free to support alternative media like SMEs Today Magazine.…

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Ten years of illuminating SMEs

Ten years of illuminating SMEs

Ten years ago, the micro, small and medium enterprises (MSMEs) sector did not feature prominently in the Kenya’s national psyche. While it was obvious the sector contributed significantly to the economy, particularly in job creation, the government and even the private sector was less concerned at its existence.This was evident from the fact that the government was less bothered in enacting laws and policies to drive its growth and unleash its full potentials. Besides, commercial banks projected indifference in terms of extending credit to the sector, something that impeded growth of many MSMEs.But 10 years ago, March 2007 to be specific, SMEs Today set out on a mission of being the voice of MSMEs by propagating their issues, lobbying policy makers to create an environment conducive for their growth and celebrating their successes.  When the first issue of SMEs Today hit the newsstands, few took notice with the common assumption in the publishing industry being that here is yet another business magazine that has launched with pomp and colour but will soon fold like many others before it. This perception got credence on the argument that being a publication targeting MSMEs, a neglected sector, advertising support would be non-existent because MSMEs did not have advertising budgets. Besides, they also argued that launching as a monthly publication was utterly over-ambitious.Unknown to them, the people behind the publication had a mission to redirect MSMEs from the periphery to the high table of the country’s development agenda. Indeed due to this mission, the government, commercial banks and other stakeholders soon started taking notice of the sector.The results are evident. Top on the list was the decision by the government to enact the Micro and Small Enterprises Act, 2012. The act gave birth to authority whose mandate is to formulate and review policies and programmes, promote and develop MSE sector, monitor and evaluate implementation policies, programmes and activities related to MSE development. Apart from the government, commercial banks also realized the sector was critical for their growth and one after the other they established departments and sections dedicated to serving the sector. Other institutions have also followed suit coming up with products and services directed at serving the needs of MSMEs.In the 10 years that SMEs Today magazine has been in the market, consistently producing an issue every month with content specifically designed to scale the heights of businesses, MSMEs have been the key beneficiaries. This is because over the past decade the publication has offered them a platform to propagate their issues.This March, SMEs Today magazine is celebrating 10 years, a period that has been both exciting and challenging. But despite the changing seasons, we have kept the promise of ensuring that MSMEs are today at the pinnacle of the country’s development. As we embark on the journey of our second decade, we promise to keep the fire of MSMEs burning as we see them grow to large corporations.

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Adios 2016, Welcome 2017

Adios 2016, Welcome 2017

The end of the year is always a time to reflect on the year that was and set plans for the coming year. In most cases, it is a time to look back on events that shaped and defined the year and also reflect on the achievements and failures. It is also a time to lay down the priorities for the coming year.In the business world, 2016 was in many ways a bad year. Forget the declaration by the government about how the Kenyan economy maintained a steady growth of 6.1 per cent. If anything, the growth was nothing but superficial if the realities that defined the business environment were anything to go by.From large companies, to medium enterprises down to micro businesses, the tagline in 2016 has been of struggle to maintain profitability and struggle to remain afloat. For big companies, restructuring, downsizing and relocating to other countries was the order of the year. In the process, at least 10,000 Kenyans working for big companies lost their jobs.In the micro, small and medium enterprises (MSMES), the situation was even worse. Delayed payments (the government being the worst culprit), lack of financing and competition caused the death of many MSMEs. According to the Kenya National Bureau of Statistics, the high mortality of MSMEs played out in a big way. In the process, more Kenyans found themselves jobless.The job crisis witnessed in 2016 should serve as warning bells for the government. Already Kenya is battling an unemployment problem  which stands at 46 per cent. For the country to lose more jobs because companies are feeling the pressure of a tough environment is quite unfortunate. It is for this reason that the government needs to relook at policies to arrest the situation. One area to start with is to ensure the government and its agencies pay suppliers with whom it does business promptly.With 2016 ending on gloom for the business community, many would have looked into 2017 with optimism. Unfortunately, pessimism is in the minds of many. Being an election year, business leaders have little to cheer about. In fact, many are not even strategising on business revival but are crafting ideas on how to shield their enterprises from the negative effects of the electioneering period, both prior and after.In 2017, the country is definitely going to be engulfed in the election mood, with anxiety being the new normal for both individuals and companies. As a publication that puts the stability and welfare of Kenya at the heart of our operations, our hope is that despite the divisions and fallouts expected, Kenya will emerge from the 2017 elections standing tall and the echoes of our national anthem ‘May we dwell in unity, peace and liberty’, will be ringing in every Kenyan’s mind. 

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Finally, tangible data on MSMEs

Finally, tangible data on MSMEs

The micro, small and medium enterprise (MSMEs) sector is an important cog in the country’s economy. The sector not only accounts for majority of the enterprises in the country but is also the key source of employment opportunities for majority of Kenyans. Despite its importance, the sector has always remained extremely fragmented. This has made it impossible to really differentiate the diverse nature and levels of MSMEs. In fact, due to lack of tangible data, understanding the sector has been nothing short of impossible.This explains why different organisations that deal with MSMEs are forced to come up with their own definition on what constitute an MSME in line with the sort of engagement they want to pursue. This state of affairs often put the MSMEs at a disadvantage because more often than not they are forced to align themselves with the definition of the organization.It is for this reason that we feel the need to applaud and commend the Kenya National Bureau of Statistics (KNBS) for undertaking a comprehensive survey on the MSMEs sector in order for the country to understand the status of the sector. The survey, which was released in September, provides comprehensive data, at national and county levels, on the characteristics, operations, dynamics and evolving nature of MSMEs in Kenya. Some of the critical things the survey has done is to avail tangible data on MSMEs on issues like clear definition of MSMEs, number of jobs the sector creates, ownership, contribution to the economy, financing, innovation, challenges, rate of mortality among others. In a nutshell, the survey is a one-stop-shop for credible information regarding MSMEs.Going by the importance of the MSMEs sector, it was quite a prudent decision by KNBS to carry out the survey and come up with the report. The benefits are enormous because the government now has reliable data on the state of the sector which will act as a guide when it comes to policy formulation on issues affecting MSMEs.More importantly, other stakeholders like large corporations that do business with MSMEs, commercial banks and other lenders, non-governmental organization, foreign companies and even donors will now have information that is credible on the sector and which will help them make informed decisions while engaging with MSMEs.The report is particularly important for commercial banks and other lenders like microfinance institutions that are critical partners of MSMEs in their growth journey. There is no denying that access to finance is one of the major challenges facing the sector. Thus, with tangible data lenders will be in a position to make informed decisions on different levels of MSMEs and know how to help them grow.It is our hope that all stakeholders will utilise the finds of the survey in order to push the growth of the MSMEs sector and ensure it remains an important pillar of the economy.

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Oil Petrodollars; Waiting for Godot

Oil Petrodollars; Waiting for Godot

When Samuel Beckett wrote the masterpiece play entitled ‘Waiting for Godot’, he never anticipated how relevant the theme would be years later. Beckett penned the play in the early 1950s and over six decades later the story line still applies in modern day world. Today, Kenyans find themselves in a peculiar scenario of having to wait for Godot. Since British firm Tullow Oil discovered oil in Turkana, northern Kenya in 2012, anticipation has been ripe that Kenya is on the verge of a windfall from petrodollars.

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Safeguard EAC Integration

Safeguard EAC Integration

The ground on which the East Africa Community (EAC) stands has for a long time been shaky. Now, the shaking is fast mutating to tremors and soon enough it could become a full blown earthquake if the rivalries being witnessed among member states are not arrested. By all accounts, the revival of the EAC in 2000 after the original club collapsed in 1977 was heralded as the best thing in efforts of integrating the economies of Kenya, Tanzania, Uganda and later Rwanda, Burundi and South Sudan. A decade and a half later, there is much progress and a lot to be proud of in as far as creating a big economic bloc is concerned.

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Real Estate Developers must keep Promises

Real Estate Developers must keep Promises

It is a dream of every Kenyan to live in a gated community with all the amenities that proclaim ‘life is sweet’. In fact, every Kenyan who can be classified as falling in the middle class bracket harbours a dream of living in a modern house located in a serene and quiet neighbourhood. The dream becomes even more fantasizing if the gated community has a golf course. Having probably studied by the psychology of the typical Kenyan middle class, which is characterised with consumerism and living life on the first lane, real estate developers have found a market to exploit to the fullest.

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Welcome back, Chase Bank

Welcome back, Chase Bank

One cardinal rule that students of journalism are taught is that as a journalist, your emotions must always be detached from the subject of your story. In other words, if for instance you are sent to cover the Huruma disaster, duty demands that you should not project an iota of emotions despite being a witness to devastation, pain and death. Being human, adhering to this rule has often proved futile for many journalists.

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Regulators – Time to Act

Regulators – Time to Act

There has been an existing fundamental flaw with different regulatory bodies in the country – a penchant to bury their heads on the sand while those they are supposed to regulate have a field day and run riots.In terms of regulatory bodies, Kenya is a highly regulated country. There are tens of regulators overseeing various sectors and industries.

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Ag CEO, the new Order

Ag CEO, the new Order

Being the head of a parastatal in Kenya is probably one of the most insecure jobs that one would wish for. That notwithstanding, the number of people applying for any vacant parastatal job, particularly in the so called strategic state corporations, shows there is something lucrative about the job. A case in point is the fact that a total of 120 individuals applied for the position of Kenya Airports Authority (KAA) managing director when it was advertised in November only to be terminated mid-stream and re-advertised again.

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Blockbusters 2016 – Politics, Corruption and Economy

Blockbusters 2016 – Politics, Corruption and Economy

Before the release of any movie or blockbuster production, producers always release a trailer well in advance to arise the anticipation of audiences and give them a sneak preview of what to expect. The trailers, as a rule, capture the most captivating, exciting and thrilling scenes and are designed to make audiences eagerly wait for the official release. In Kenya, 2016 is just unfolding and the trailers of the blockbusters that will characterise the year have already been released. The camping of President Kenyatta in the coastal region for the better part of January, which the opposition Cord described as nothing but a vote hunting foray, is one trailer preparing Kenyans for an epic political duel in 2016 pitting the Jubilee Alliance coalition and Cord.

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