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  • Writer's pictureNathan Temeyer

Rethinking MSME Support: Beyond Programs

When it comes to supporting micro and small enterprises (MSMEs), the traditional approach of enterprise support organizations (ESOs) is often limited to structured programs. These programs, often funded by grants, run for a set period - culminating in the celebration of participant completions and often moving on to the next program and participants. However, this program-centric model overlooks the continuous and dynamic needs of MSMEs operating in some of the most challenging environments in the world. And with some of the recent advanced in large-language models (LLMs), we have an opportunity as an industry to rethink and expand how we serve and seek to develop MSMEs around the world.

The Limitations of Program-Centric Support

ESOs often operate under a more traditional, school-like framework: a program has a start date, an end date, and a "graduation." Once participants complete the training, they are sent off, with hopes that the lessons learned will be sufficient for their success. The high-performing ESOs will often check in after 6- or 12-months to collect some longitudinal data for impact measurement purposes. But the meaningful part of the relationship is usually limited to the bounds of the program.

While useful in many ways, this model fails to acknowledge that the business environment is far more complex and dynamic than a classroom setting. COVID forced many ESOs to digitize their content and delivery, but the fundamental system remained unchanged. MSMEs face ongoing challenges that extend far beyond the end of a training program.

While training programs can be valuable, they are not comprehensive solutions. The needs of MSMEs include:

  • Digital Networking: MSMEs need ongoing connections with other business owners to facilitate efficient purchases and sales.

  • Informal Credit Scoring: Building a system that allows MSMEs to establish creditworthiness and access lines of credit for expansion - especially in areas with high cash utilization or limited use of bank accounts that can provide that data.

  • Financial Tracking: Implementing systems that help them monitor their finances in an accessible and user-friendly manner while also

  • Data-Driven Decision Making: Providing access to data that can improve their confidence and decision-making processes. It can also provide a feedback loop that fuels the other pieces mentioned above.

Focusing solely on programs risks offering solutions that may seem out of touch with the actual day-to-day realities of MSMEs.

*This diagram illustrates the broad scope of MSME needs. We can't possibly provide for everything an MSME needs to be successful. However, there are many related things that ESOs can expand to provide for more impactful interactions.

The Potential of AI and Agent-Based Solutions

The advent of AI and agent-based solutions presents an incredible opportunity to bridge the gap between traditional program support and the dynamic needs of MSMEs. These technologies can deliver personalized, dynamic, and scalable solutions across hundreds of languages. To truly support MSMEs, we need to think bigger and more creatively about how we utilize these tools. We no longer live in a world where data-driven decision making requires meticulous organization of the data attributes in a spreadsheet or database. LLMs provide a flexible tool that actually mirrors many of the complex and dynamic realitiies of data collection in developing countries. The time is now!

Imagine a World Where:

  1. Financial Tracking is Familiar and Seamless: MSMEs can nimbly track their finances using familiar, guided processes within their favorite chat-based applications like WhatsApp. There's no need for complex ledger-based systems or software like QuickBooks that aren't designed for them and require near-perfect accuracy to be valuable. We talked about this in some previous posts and have a free prototype available if you want to see how it works. We see this as potentially the biggest opportunity outside of traditional programming. It's not perfect yet, but we hope you can see the potential!

  2. Coaches and Mentors Have Deep Visibility: ESO coaches and mentors can gain immediate and deep visibility into the most crucial areas of discussion, whether inside a program or beyond. They can receive personalized guidance on how to navigate challenges that MSMEs might not even be aware of yet. We're building a system that gives ESOs the ability to track and access their notes and build upon them over time. Check out the free demo of our early work that you can view here.

  3. Financial Providers Have Enhanced Clarity: Financial providers can obtain a clear view of day-to-day business operations, instilling the confidence to lend uncollateralized loans at lower interest rates. This can help more businesses scale and improve their operations further. We don't have a demo of this to share yet, but hope you can see how the data from improved financial tracking can move to support this function in the future.

Embracing a Broader Vision

We can and should continue to assist in program management. We're actually building functionality to help ESOs do this broader and better. However, limiting ourselves to this narrow mindset means missing out on the broader opportunities in front of us. By expanding our approach and embracing AI and agent-based solutions, we can provide ongoing, dynamic support that addresses the continuous needs of MSMEs. And we can move from a finite and limited version of support to something closer to an infinite relationship that changes and grows alongside MSMEs after graduation.

Let's imagine and work towards a world where MSMEs are not just trained and sent off but are continuously supported, connected, and empowered to thrive in their unique environments. By thinking bigger and utilizing advanced technologies, we can revolutionize the way we support these vital enterprises, ensuring they have the tools and resources needed for long-term success.

Stay tuned for more updates as we explore and develop these innovative solutions, aiming to provide a coach for every business, every step of the way.

What do you think? Do ESOs have a responsibility to think beyond program end dates in our support of MSMEs?

  • Yes

  • No

  • I'm not sure

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