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Lack of business training contributes to small businesses difficulties

Online training is growing in the US - and is set to boom in SA as Internet use and bandwidth increases. The often-repeated "fact" that eight out of every 10 business start-ups in South Africa fail, may well be overstating the figures, but according to Statistics South Africa, the number of voluntary liquidations has more than doubled since 1998.
Start-up companies are not the only ones that experience business failure. It also affects businesses that have been around for some time. According to the Banking Sector Education and Training Authority (Bankseta) small, medium and micro enterprises (SMMEs) play a pivotal role in the creation of high-growth economies and employment. Bankseta has identified SMME training and development as one of their key priorities.

An analysis by Actionwise, a business and management services company based in Johannesburg, found that most reasons for business failure are not outside the company. Over 80% of the reasons a business fails are within the control of business owners and managers.

Where do successful companies invest their funds and attention?

One area proven to result in long-term stability and expansion is business and management training. There is a direct correlation between the level of investment in company training and increased levels of productivity and profitability. On average, training will raise your employees productivity 5 - 20%, says the Industry Training and Productivity Review released in late 2004 in the US.

CEO of Actionwise, Jean Gonsalves advises, "Take a look at the companies you regard as models for doing business right. Training is a part of their culture. If you want business success, start by investing in your people: train them."

As Internet access grows, online training is catching on. It can deliver significant cost savings when compared to traditional types of business training, according to the American Society of Development and Training (ASTD).

In the US, as much as 20% of corporate training is conducted online, and this figure is expected to increase as Internet connectivity grows and computers become faster than ever.

The roll out of new providers for Internet access accelerated growth in Internet use in South Africa by 7.4% in 2004, according to a study by independent technology research organisation World Wide Worx. The survey also found that small businesses with Internet connections were increasingly pursuing high-speed connectivity, with only one out of five using traditional dial-up modem access.

An online business and management training course for South African entrepreneurs was launched recently on the new Actionwise website The course is based on the Small Business Success Manual.

Training and development initiatives at all organizational levels transforms organizations. The knowledge gained can lead to increased productivity, profits and business success.

About the author

Peter Cole is with Actionwise, a business and management training and consulting company. They also offer online business and management training using the Small Business Success Manual. Built-in proven learning methods assure understanding and 100% efficiency. Visit the new Actionwise website at