Handbook on Women-owned SMEs: Challenges and Opportunities in Policies and Programmes
This handbook (published 2007) addresses challenges in starting and growing Women-Owned SMEs (WOEs), as well as how to best support them in an increasingly globalised world where skills development is ever more important. It presents both descriptive data on WOEs and analysis on specific issues of interest to those promoting WOEs, including practical examples of programmes and policy instruments for fostering WOEs worldwide. The book presents a global outlook, reflecting on the situation of WOEs worldwide and contains examples from different parts of the world. Though developing economies, and to some extent transition economies, receive special consideration, the content is relevant for developed countries as well.
Declining costs of information and communication technology, globalization and changing conditions for innovation and entrepreneurship create new opportunities and challenges for countries and business around the world. In this rapidly-evolving landscape, the role of large and small firms is changing. Large firms are downsizing, outsourcing and offshoring while raising productivity around a narrowing core business. Small and medium-sized enterprises (SMEs), on the other hand, account for a growing share of the workforce in most countries and are becoming more important for economic growth, exports, local development and innovation. Also, SMEs are not only businesses but are clearly led and strongly influenced by the people behind them – the entrepreneurs.
There are different kinds of entrepreneurs. They may be divided in terms, say, of education, motivation, age, and gender and business characteristics. One of the fastest growing categories is women owned enterprises (WOEs). The potential of women is greatly underdeveloped in many societies. Yet, women commonly play a very important role in the local economy. By forming WOEs, women are often able to overcome traditional boundaries. WOEs now account for a growing share of all new enterprises in many economies. New technologies and associated societal and organizational changes represent great opportunities. However, barriers still remain.
The issues confronting women-owned enterprises are not unrelated to those confronting men or entrepreneurs in general. Yet, the emphasis – and the effective solutions – are often different. For instance, female entrepreneurs tend to have less collateral and represent (or be viewed as associated with) activities in the “informal economy”. They pursue (or are viewed as pursuing) low-key businesses with little growth potential. There are limitations in information or reliable statistical data on WOEs and cultural and economic barriers throughout the registration and start-up process, as well as during later business development.
The fact is however that women tend to take more of a long-term approach than men. They tend to be interested in borrowing less and there is generally less risk of bankruptcy. Special issues exist with regard to opportunities for networking and partnering with other firms. There are also specific managerial and skills issues. All these aspects may be viewed as problems, but seen differently they represent opportunities. Women make up half the population but still represent much less in terms of formal entrepreneurship. Yet, their importance to the development of the economy is critical in many areas and developing the tools and solutions that are tailored to their specific challenges can lead to enormous economic and social gains.