38986 1 reb mun MONITOr The Small and Medium 6002 Enterprise Toolkit ya m The Small and Medium Enterprise (SME) Toolkit was created in 2001 as part of an effort by the SME Department to find ways to reach a larger number of companies than were being reached through the traditional International Finance Corporation (IFC) strategy of working with com- panies on an individual basis. The theory was simple: the IFC and local partners would amass information relevant to SMEs and present it on the Internet, where business people could find and use it themselves. The IFC retained Nexus Associates to · Offering some assistance in coun- provide an interim review of the Toolkit, tries where investment opportuni- and in 2005 the company reported that ties are limited. the project had accomplished its original As of March 2005, 16 Web sites incorpo- noitaroproc objective and many more as well. rated one or more components of the SME Toolkit (a number of other sites have been The Toolkit at a glance established since then). These include Launched in 2001, the Toolkit was con- seven sites where the SME Toolkit team ceived as a means of providing information is fully responsible for development and to SMEs in a more cost-effective manner maintenance of the site; five sites that are than could be achieved through working managed by local partners under terms ecnanif with companies one by one. But its objec- and conditions agreed with the IFC; and tives expanded over time to include: four sites where local partners license con- · Building the capacity of local part- tent from the IFC that is posted--along ners to deliver new training and with a broad range of other materials--on lanoitanretni consulting services. Web sites that partners have developed on · Supporting the marketing efforts of their own. partners. Partners include: · Enabling organizations to establish · IFC facilities. The Sustainable Fi- a Web presence and attract visitors nancial Market Facility, Latin to their Web sites. America and Caribbean SME Fa- · Establishing and reinforcing rela- cility, South Asia Enterprise Devel- tionships between the IFC and com- opment Facility, Madagascar SME eht panies in its investment portfolio. Solution Center, and the Mekong · Promoting the IFC brand. Project Development Facility view m o n i t o r t h e s m a l l a n d m e d i u m e n t e r p r i s e t o o l k i t 2 the SME Toolkit as a complement Evaluation findings to their existing services and a means of promoting their organi- Relevance zations in specific markets. In general, the SME Toolkit is relevant to needs of · Three private companies (two small SMEs in developing countries and the IFC's in- information technology firms and stitutional objectives. The traffic on the Web a commercial bank) use the Toolkit sites and results of the user survey indicate to attract traffic to their sites. One that users find the content useful. Content information technology firm was on business planning appears most rele- spun off from the IFC's South and vant, materials on accounting less so. the toolkit Eastern Europe Facility. Because the SME Toolkit is distributed · Nongovernmental organizations have via the Web, it is restricted to a subset of the has provided used the Toolkit to develop and en- population that has access to the Internet, hance their presence with their cli- knowledge of Microsoft Word and Excel, benefits to the ents. Examples include the Business and the sophistication to absorb and use Technologies Development Center, the materials contained in the Toolkit. ifc, partners, a spin-off from PEP-Ukraine, which Many SMEs in developing countries offers information technology con- still lack affordable access to the Inter- and end users sulting and services to SMEs; net, limiting the reach of the SME Tool- FUNDES, a business solutions net- kit. To mitigate this problem, the Toolkit work of specialized organizations team has created a CD-rOM version and dedicated to promoting SME devel- computer-based training modules. opment in Latin America; Enter- The need for a standard Web design and prise Development Services, a pri- content management system was debated vate sector initiative of the Lagos by Nexus since some partners--FUNDES, Business School created to offer PEP-Ukraine, NextSense, SMEDA--have consulting services and networking developed their own Web sites using inter- opportunities to SMEs in Nigeria; nal technical staff or external consultants. and the Emerging Market Private Moreover, Web design expertise is becom- Equity Association, an organiza- ing easier to find throughout the world at tion created to help private equity costs that are substantially lower than in and venture capital firms and in- Europe or the United States. On the other stitutional investors in emerging hand, the Toolkit approach has probably markets improve their returns and saved money by enabling most of the part- promote more investments. ners to establish a Web presence without · Government agencies. The Small and bearing the expense this typically entails. Medium Enterprise Development Authority (SMEDA), a government Effectiveness agency in Pakistan, included some The Toolkit has provided benefits to the IFC, content and a link to the SME Tool- partners, and end users. It has helped the kit on a Web site it established to IFC promote its public image, particularly reach SMEs that were not close to in frontier countries. It has been well re- regional offices. The Ministry of ceived by local partners. And it has enabled Industry in Madagascar originally some users to develop a Web presence at a partnered with the Toolkit to launch relatively low cost. Many partners see the a local content-driven site now man- content as useful either in its own right or aged by the Madagascar SME Solu- as a supplement to materials that they had tions Center. already developed. m o n i t o r t h e s m a l l a n d m e d i u m e n t e r p r i s e t o o l k i t Who uses the Toolkit? A user survey, analysis of Web site traffic, and interviews with partners reveal several pat- terns in the use of the SME Toolkit. · Traffic on the SME Toolkit Web sites has been generated primarily by search engines and Web links. Overall, 41% of respondents said they found out about the Toolkit through search engines, and 33% arrived at the Toolkit sites through links from other Web sites. This reinforces the importance of optimizing the Web sites for search engines and establishing links to other sites as part of marketing campaigns. Other methods, including through newspapers or magazines, word of mouth, business train- ing courses, and newsgroup postings, were much less important, although there is substantial regional variation. In Nepal newspaper coverage was particularly impor- tant, while for the Mongolian, Spanish, and Ukrainian sites links from other Web sites were relatively important compared with other sites. Word of mouth was relatively important for the Mongolian, Ukrainian, and Vietnamese sites. · Traffic has increased significantly. In March 2005 the number of visits to SME Toolkit sites totaled 30,000. This primarily reflects a marked increase in activity on the global and Africa sites, driven by a marketing campaign launched in August 2004. · More than half of all sessions were one minute or less, suggesting that many visitors come to the site inadvertently. But between one-fifth and one-quarter of visits lasted more than 10 minutes. · Business planning is by far the most popular topic for articles and downloads, account- ing for 55% of the content viewed by users. · Half of all page views were requested by users in Mongolia, South Africa, the United States, and Vietnam. Besides the United States, only three other developed countries-- Canada, France, and the United Kingdom--were among the top 25 countries. Unresolv- able IP addresses may result as US addresses (.com) so may not be reflective of US-based traffic. · Survey respondents indicated that users tend to be well educated males. Five times as many males use the Toolkit as do women, while two-thirds of the users attended col- lege and almost a quarter had also done postgraduate study. · Users see the Toolkit mainly as a resource library, and secondarily as a source for online training. It is reaching SMEs in developing coun- Efficiency tries and a broad range of other organiza- Given high fixed costs, the efficiency of the SME tions and individuals Toolkit depends on the volume of activity. As of Based on the review's survey results, March 31, 2005, roughly $2.0 million had 83% of respondents indicated that the beencommittedand$1.6milliondisbursed Toolkit includes a wide range of materials (not including an estimated $800,000 in that are useful to SMEs, and almost two- staff time) over the four-year operational thirds report that the Toolkit is one of the period. About 42% of total disbursements best sites for how-to articles and business had been allocated to technology develop- forms. Furthermore, almost two-thirds of ment, 17% to partner implementation, 16% users who had visited a Toolkit site more to business management training, 15% to than once reported using it to improve content, 3% to general technical support, their businesses. and the remaining 6% to other activities. m o n i t o r t h e s m a l l a n d m e d i u m e n t e r p r i s e t o o l k i t More than $1.5 million will be invested the partners is currently generating signifi- in technical enhancements in version 2.0 of cant revenues from the Toolkit directly. the software, and additional expenses will be incurred in rolling out new SME Tool- Lessons learned kit Web sites in the coming years. Much of The SME Toolkit is a useful product that can the costs incurred to date represent start- serve both institutional and development objec- up costs--content, Web site, content man- tives. Sponsoring organizations can use the ideal agement system, and curriculum. Toolkit to establish a Web presence, ad- If each partner had developed Web sites vertise their services, post information rel- licensees are with similar content and functionality the evant to SMEs, and otherwise support their total cost probably would have been higher. partners and clients. The ideal licensees are organizations organizations that are committed to signifi- Sustainability cant localization and ongoing maintenance committed The SME Toolkit will depend on continued of the Web site. Whether partners under- financial support from the IFC and other do- take full implementation or just use Toolkit to significant nors. reviewers saw little chance of spin- content on their own Web sites, they should ning version 1.0 of the SME Toolkit off as be responsible for adding content that is localization a commercial venture given its emerging valuable to SMEs in their markets and not markets focus and use of third-party con- widely available on other sites. Agreements and ongoing tent offered free of charge. No organiza- should specify the nature of the content the tion has yet paid for the global content, local partner will provide initially, plans for maintenance of Web site design, or content management adding additional content in the future, system out of its own operating budget, al- and a schedule for implementation. the Web site though partners cover their own ongoing operating costs. A number of government Specific policies on cost sharing are needed. agencies, donors, and nonprofit organi- Partners should be required to invest a zations have developed small-business- minimum amount to cover some of the focused Web sites, and more are likely to start-up costs of translation, initial local do so in the future. content, and installation and the costs of Most partners are IFC facilities, which ongoing updates and maintenance of the were not designed or envisioned to be- Toolkit. To help establish this threshold, come financially self-sustaining institu- hard data must be gathered from existing tions; their ability to continue operations partners on their actual expenditures. (including the further development and An ongoing mechanism to monitor part- ongoing maintenance of the SME Tool- ners' investment is needed to ensure that kit) depends on support from interna- contractual obligations are met and that tional donors. FUNDES and SMEDA, al- the investment threshold can be adjusted though not IFC facilities, are similar in periodically. nature. For private companies such as Next- Toolkit sponsors and local partners should regu- Sense, Elite Networks, and TDB, the sus- larly add content on areas of interest to SMEs in tainability of these Web sites depends on developing countries. A multitude of content their ability to generate sufficient revenue providers around the world might be inter- or traffic to cover ongoing development ested in licensing materials for noncom- and maintenance costs. Among the sources mercial purposes as part of good citizen- of revenue mentioned by the partners are ship or public relations campaigns. Those advertising revenues from third parties responsible for managing content should and sales of principal services that come make sure that materials, including more in some way through the Web site. None of interactive materials for training purposes, m o n i t o r t h e s m a l l a n d m e d i u m e n t e r p r i s e t o o l k i t are at a level that less sophisticated users Marketing is key to the success of the SME can understand and use. Toolkit. The SME Toolkit team has suc- In the near term, more content is need- cessfully initiated efforts to increase traf- ed related to business planning, which is fic on certain Web sites, but as of March the most popular subject on current sites. 2005, traffic on many sites was low. Since For the longer term, a systematic process most users are likely to reach the Web is needed for collecting feedback from sites through search engines or links from partners and users concerning their con- other Web sites, the design and text of all tent requirements. As part of this process, sites should be optimized based on the managers should assess whether low usage algorithm that Google uses for ranking. of some materials is due to limited interest, Moreover, Web sites should be updated on marketing is lack of relevance, or poor quality. Assuming a regular basis with information of great- that a registration system is adopted, user est interest to companies in the target key to the feedback should be based on regular, ran- market. Content should be added not only domized surveys. (Version 2.0 of the SME to benefit users, but also to increase rank- success of the Toolkit has been designed to enable full- ings by search engines. Other marketing implementation partners to update their approaches--direct mail, broadcast me- Sme toolkit Web sites more easily and share content with dia, and press coverage--should be the re- other SME Toolkit partners.) sponsibility of local partners and tailored to the particular market characteristics in Information providers should develop multiple each country. distribution channels for the SME Toolkit content. Most partners involved with the SME Toolkit Performance metrics for the SME Toolkit need to indicated that access to the Internet in their be aligned with objectives. To ensure that the markets is limited, slow, and costly. A pos- products meet the needs of managers, do- sible solution would be to distribute content nors, partner organizations, and SMEs, an- on CD-rOMs on a much broader scale. To nual targets should be set for: the number date, the Toolkit team and local partners of sites by business model (co-brand, full im- have made only limited use of CD-rOMs, plementation, content only), number of sites distributing approximately 3,000, mainly by partner type (IFC facilities, nonprofit or- for promotional purposes. Organizations ganizations, for-profit private enterprises), that are working with SMEs, particularly unique visitors, frequency of visits, number those that receive funding or technical as- of sessions, percentage of sessions from de- sistance from the World Bank, would be veloping countries, average duration of ses- obvious candidates for such distribution. sions, percentage of sessions lasting more As of March 2005, all the global content of than 10 minutes, average depth of session the SME Toolkit was available in English, (number of page views), percentage of ses- French, Mongolian, and Spanish, and por- sions with more than 10 page views, percent- tions had been translated into other lan- age of users reporting that information has guages. Planned enhancements for version been useful, percentage of users reporting 2.0 of the SME Toolkit will make it much that information is not readily accessible easier for the Toolkit team and partners to elsewhere, total cost per session hour, and publish the SME Toolkit on CD-rOM. total cost per participant training hour. re- Web sites and CD-rOMs also should sults should be reported annually. be considered as channels to distribute training manuals to business development Long-term strategic plans and annual operat- service providers, enabling more organiza- ing plans should set explicit goals and objectives. tions to learn how to use the SME Toolkit A strategic plan should define the prod- in training courses. uct and target market precisely; provide a m o n i t o r t h e s m a l l a n d m e d i u m e n t e r p r i s e t o o l k i t 6 clear statement of guiding principles; de- should detail the specific activities that will fine major policies; describe management be carried out. structure and staffing (including consult- Since there is no price mechanism to ants); define how important and recurrent mediate demand, managers should ensure activities will be carried out; specify needed that partners have explicit plans for using equipment and software; define the invest- additional features and functionality be- ment needed to develop, deploy, and main- fore making an investment. tain the Web site; explain how costs will be The strategy also should clearly articu- covered; and delineate the performance late the role of managers in training train- measures and standards that will be used to ers, developing curricula for classroom- gauge whether the organization is achiev- based management training, and delivering ing its objectives. The strategic plan should courses directly to end users. And it should also delineate potential exit strategies in the describe how such training efforts can be event that donors are no longer willing to replicated to maximize the return on train- support a project. Annual operating plans ing investments. Monitor Monitor shares key findings from in-depth reviews of technical assistance programs and projects conducted by external evaluators. These reviews address the relevance, efficiency, effectiveness, and sustainability of technical assistance programs. SME Department Email: infosme@ifc.org t h i s n o t e i s a v a i l a b l e o n l i n e : w w w . i f c . o r g /