Since only about half the employable people globally have jobs, it's time to start training youngsters for self-employment
For a living, there is nothing more pleasurable than owning and running one’s own enterprise. True, lately, even in India, some companies offer a hefty pay and perks which exceed the profits of a small-to-medium industry or business. Nevertheless, the satisfaction of owning an enterprise is greater and well offsets the income of a top job. Mind you, a chief executive of a large corporation has several advantages other than merely pay and perks. To be able to operate on a large scale as well the potential of further expansion on commensurate scale is itself a substantial compensation.
The larger the enterprise, the greater the market and, perhaps, influence, and the more the number of people reporting to the CEO. Some chief executives experience, and rightly so, a sense of power which a medium self-owned enterprise can’t provide. Until 1980, I headed a company, with no questions ever asked, which employed 25,000 people. That pleasure is yet to be replicated in my own business-cum-industry which has been successful for its size. For a musician, the pleasure of playing on a grand piano far outweighs the satisfaction that a harmonium provides, although the former belongs to someone else while the latter is one’s own. The pain and humiliation of the piano being taken away would be greater than the pleasure it ever gave you.
Nevertheless, if I were born again, I would get into my own business earlier than I did in this innings. But I must not forget to mention that a certain discipline and method of work that a large organisation provides, a small one seldom gives. It is not widely known that management science or business management as a subject was started by what an officer observed of the German Army’s functioning during World War I: How best to develop an effective organisation economically and then run it optimally. An example that readily comes to mind is the famous “tooth to tail ratio”. Given, say, a division of soldiers, maximise the number of fighting/firing men and keep the deployment for servicing/supporting the frontline men with rifles and machine guns at the bare minimum. It was subsequently discovered that the British Army had a 1:10 ratio, while the German ratio was 1:4. On this criterion, the Germans were two-and-a-half times more efficient than the British at the fundamental function of fighting and killing the enemy.
Do not get the impression that I favour the Army set-up as an ideal example for organising a large company. One, I have quoted an example of over a century ago. Two, in today’s context, the Army’s fighting soldiers and officers are divided into many layers. A better focused training would require fewer layers of supervision or leadership. In contrast, small businesses require versatile men and women, persons who know how to perform multiple functions for the simple reason that the smaller the company, the fewer number of persons it can afford to employ.
Looking at the world scenario, only about half the employable people have jobs. The other half is self-employed, which includes the wealthiest entrepreneur to the humblest hawker. The message is that of the two youngsters coming into the employment market, one must look for self-employment. If one’s education has been law, medicine, accountancy or suchlike, s/he knows what to do. Else, one may try one’s hand at business. This is where youngsters who do not belong to families with a business tradition can feel lost. Business management studies enumerate theories on commerce-related subjects. But they seldom lay out advice on how to set up a business if one has no experience. Few successful entrepreneurs write their life stories for the beginners to learn from. Nor have the publishers of educational books apparently persuaded enough entrepreneurs to fill this knowledge gap.
A word of caution: Neither an inheritor of business nor an academician is quite the appropriate author of a truly useful book. Only someone who happens to have started his/her enterprise from scratch and succeeded, is such an author.
My plea is urgent because in the employment market right now, women in significant numbers are seeking jobs, which was earlier a men’s monopoly. We had not heard of women fighter pilots in the Air Force; now they are a reality. On the other hand, the COVID-19 affliction has caused a loss in jobs. Will all the shops survive or will home deliveries replace some of them? What are likely to be the effects of work-from-home on employment?
With no family tradition of business, I worked as an executive in big companies for 23 years. By pursing acquaintances in multi-national corporations, I got started with contract manufacturing. That line helped me set up small factories manufacturing and selling similar goods. This is one example of how a novice can enter his/her own enterprise. But one factor is certain: The person concerned has to lose his/her fear of insecurity. The security of a steady job can sometime be as bad as a disease.
India is proud of its business management schools which have turned out first-rate executives. But it will be interesting to see a survey of their alumni: What percentage has developed their own enterprises? I feel there is a need for similar schools for small enterprises. A laundry, a restaurant, even a grocer or panwallah is a business worth learning and pursuing. Everyone need not learn how to run a large company. In fact, there is greater scope for smaller enterprises but I doubt if there are schools teaching about them.
(The writer is a well-known columnist and an author. The views expressed are personal.)
