Marketing & Sales ategy Finance & Indicators Human Capital Operations Strategy Opera Marke eting & Sales Operations Financ nce & Indicators Human Capital Marketing & Sales ategy Finance & Indicators Human Capital Operations Strategy Opera Marke eting & Sales Operations Financ nce & Indicators Human Capital Marketing & Sales ategy Finance & Indicators Human Capital Operations Strategy Opera Marke eting & Sales Operations Financ nce & Indicators Human Capital Marketing & Sales ategy Finance & Indicators Human Capital Operations Strategy Opera Marke HECTOR D. DEBERNARDO MARGARITA HURTADO HERNANDEZ Top 60 mistakes made by Small and Medium Businesses and to avoid them how To get the e-book, either in English or Spanish, e-mail us to [email protected]
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Top 60 mistakes made by Small and Medium Businesses and how to avoid them
You can get the e-book, either in English or Spanish, visiting http://www.puenteempresarial.com/2010/06/06/libros-y-articulos-en-venta.
This book introduced what the authors claim are the top 60 mistakes made by Small and Medium Businesses and methods to avoid them.
Hector D. Debernardo is a senior management consultant and independent board member. Mentor to executives and family business successors. Writer and lecturer. He has collaborated with more than 100 manufacturing, commercial and service companies in Mexico, Argentina and Spain. Expert in the areas of operations and project management, strategy design and commercial planning, innovation, change management and family businesses.
Margarita Hurtado Hernández is an academician oriented towards the application of knowledge in order to obtain positive results in organizations through business training and the higher education of young professionals. Agro-Industrial Engineer (Universidad de la Sabana, Colombia), Ph.D. in Industrial Engineering (Universidad de Navarra, Spain) and graduated from the Executive Management Program (IPADE, Mexico) and the Developing Women Leaders in University Administration Program (UCLA, USA). Current Director of the Industrial Engineering Bachelor and Professor of the Operation Management Department at Universidad Panamericana (Mexico). Leader of research projects on how to improve the performance of an organization through the system approach.
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Marketing & SalesategyFinance & Indicators
Human CapitalOperations
Strategy
Opera
Markeeting & Sales Operations Financnce & Indicators Human Capital
Marketing & SalesategyFinance & Indicators
Human CapitalOperations
Strategy
Opera
Markeeting & Sales Operations Financnce & Indicators Human Capital
Marketing & SalesategyFinance & Indicators
Human CapitalOperations
Strategy
Opera
Markeeting & Sales Operations Financnce & Indicators Human Capital
Marketing & SalesategyFinance & Indicators
Human CapitalOperations
Strategy
Opera
Marke
HECTOR D. DEBERNARDO
MARGARITA HURTADO HERNANDEZ
Top 60
mistakes made by
Small and Medium Businesses
and
to avoid them how
To get the e-book, either in English or Spanish, e-mail us to
Copyright 2014 by Hector D. Debernardo y Margarita M. E. Hurtado Hernandez. All rights reserved.
No part of this book may be reproduced and transmitted in any form and by any means without the written permission of the publisher, except in the case of brief quotations used in book reviews and critical articles.
Published in Mexico byHector D. Debernardo. Empresa 113-5, Insurgentes Mixcoac, 03920 Mexico DF, Mexico. [email protected].
First edition. March 2014.
ISBN: 978-607-00-7773-9
Original title in Spanish: “Las PYMES. Principales causas de fracaso y cómo combatirlas”, by Hector D. Debernardo and Margarita M. E. Hurtado Hernández, Ediciones Fiscales ISEF, 2008.
Translated by Cecilia Martinez Lavin Castañeda.Cover and layout design by Ana Cecilia Flores Calderón.Intellectual property advisor: Jorge Molet Burguete.
Top 60 mistakes made by SMB and how to avoid them
Senior management consultant and independent board member.
Mentor to executives and family business successors. Writer and
lecturer.
He has collaborated with more than 100 manufacturing, commercial and
service companies in Mexico, Argentina and Spain.
Expert in the areas of operations and project management, strategy
design and commercial planning, innovation, change management and
family businesses.
Author of the books "El Puente. Mejore los resultados de su empresa
aplicando el pensamiento sistémico" and "Top 60 mistakes made by
Small and Medium Businesses and how to avoid them". Guest author of
the book "Contabilidad y gestión" by Ph.D. Enrique Herrscher. He
presented articles at international congresses on practical applications
to businesses of the system approach.
Founder and CEO of www.puenteempresarial.com, which was
conceived as a means for the fast publishing of contents and tools for
In a small city in a country which economy is mostly agricultural, there were three electronic engineers who were college classmates and who shared the dream of developing and selling hardware. Their revenues only allowed them to live modestly. They were having trouble finding a way to succeed.
At that time, a single company provided telephone services to the entire country. Its quality was very poor: communication was frequently lost while speaking, it was difficult to get a home line and most public telephone devices did not work properly.
One day, one of the telephone company's employees, Dan, was staying in a hotel and had an idea. He imagined a device capable of showing the user the duration and cost of the call while speaking and, at the same time, was able to indicate the receptionist how much to charge for such a call.
Since he knew nothing about electronics, he began searching for someone who was able to design such product, and that was when he met the three young engineers.
The first meeting was not very productive. They were tired of investing time in projects that produced no revenues. They doubted the idea could be a commercial success and decided that this time they would not take the risk. They asked Dan for the money equivalent to several months of their revenues as their fee to design the device. He did not have enough cash, but he did have two things: his car, which market value was approximately the amount requested by the engineers, and the conviction that his idea would be a great business.
A couple of weeks later, Dan came back, on foot, and gave them the money. He had sold the only asset he possessed in order to make his idea come true. The message was convincing. The engineers were impressed.
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Top 60 mistakes made by SMB and how to avoid them
That is how a partnership between these four people was born. Let's call it Ingevision.
When the national government decided to privatize telecommunica-tions, it demanded the winning companies to significantly improve the public telephone service. Ingevision took advantage of this situation in order to obtain a profitable growth for several years.
How did they achieve such a success?
The technology developed by Ingevisión for hotels was also useful to manage groups of telephone booths. They created a simple business model:
The owner of a commercial area made all of the necessary investment in order to turn it into a public telephone center, best known as telephone booth or telecentre.
One of the telecommunications companies provided the telephone lines.
Ingevision sold to the owner of the commercial area all the electronic equipment necessary to manage calls.
It was a real win-win solution:
Telephone companies were able to meet national government's requirements with a very low investment.
The owner of the commercial area obtained a significant percentage of the retail price of each call, at a time when rates were high.
By manufacturing and selling the devices and equipment to operate each commercial area, Ingevision obtained excellent profitability.
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Top 60 mistakes made by SMB and how to avoid them
As every time a win-win solution is found, all parties involved exceeded their initial expectations. Ingevision achieved a market value that only one of its partners could have imagined several years ago, when he sold his car.
This story illustrates one of the ways in which a SMB starts. It is referred to as proactive start up and it is comprised of three key elements: vision, know-how and opportunity.
The other way to start up a business is the one we refer to as reactive start up, in which circumstances provoke the creation of the company. It happens, for example, when a person or a group has specialized know-how which starts being highly demanded by a growing market sector. It may also occur when someone who was employed for most part of his life is laid off and, as a result of the pressing economic situation he was experiencing, and after several failed attempts to find a job, decides to start a business.
Regardless of the way in which they are created, all SMB experience similar problems. In the next pages, we will analyze the ones that, in our opinion, are their main causes of failure and we will suggest ways to avoid them in order to significantly increase the likelihood of survival, growth and development.
In order to facilitate the reader's permanent consultation, we have grouped such causes according to the five functions that are common to every organization:
Strategy, which main purpose is to establish the company's direction.
Marketing & Sales, which main purpose is to create a bigger and better demand.
Operations, which main purpose is to satisfy current demand.
Finance and Indicators, which main purpose is to support and monitor the value generating areas.
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Top 60 mistakes made by SMB and how to avoid them
Human Resources, which main purpose is to ensure that the company has the right person at every position.
The approach of this book is from the market to inside the organization. The proposed methods are closely related among themselves and their purpose is to solve problems simultaneously and not in an isolated way.
We are human beings and it is natural that we make mistakes, even though we do not like it or do it unintentionally. Maybe the biggest difference between a big company and a SMB is the lower ability to recover from the negative consequences of bad choices. This is why it is important to learn from mistakes made by others.
5 functions common to every organization
Strategy
Marketing & Sales
OperationsFinance
& Indicators
HumanResources
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Top 60 mistakes made by SMB and how to avoid them
“The only human being that does not make mistakes is the one who does nothing”
Anonimous
“With so many mistakes to be made, why do we always repeat the same ones?”
Anonimous
Top 60 mistakes made by SMB and how to avoid them
To get the e-book, either in English or Spanish, e-mail us to