A study done in 2014 about the ‘most problematic factors for doing business’ in Myanmar remains relevant to date. According to that study, the top factors are access to financing and inadequately educated workforce. Aligning with global economic order requires a workforce that can communicate in English and is familiar with the business systems and methods used in the West. It is surprising that as a former British colony, the country was not able to retain English even as a second language.
Beside communication skills, competencies required in business like management, finance and marketing are wanting among the graduates in the universities. Analytical and decision-making skills are inadequate, qualities necessary for managerial positions in big multinational corporations.
The limited pool of trained workers results to pirating and staff hopping from one company to another, looking for better positions and benefits as the human resource market becomes more competitive. Many companies are now resorting to bringing in expatriates to fill the gap in the workforce. This of course has its own disadvantages like cost, cultural adaptation and familiarity with local context.
Education for international business
For companies with strategic perspective in Myanmar, investing in human resource is always an imperative. Developing local talents who can handle roles and functions done by expats are preferred. As part of the investment for the future, companies usually recruit top graduates from the best schools and imbue them with the culture of the company. They are given further training and education if they have potentials. Career paths are always designed to entice new hires to stay in the company.
It is not surprising that many international business schools are opening in the country. One reason may be the government relaxing the rules on educational institutions setting up in the country. The other reason can be traced to the needs of companies from the West. As the number of companies enters the country, educational institutions follow as they saw opportunities of equipping the workforce of the companies.
Among the first to set up are post-graduate business schools. The demand is huge and to address this means setting up branches or working out partnerships with local institutions to offer courses needed by the companies. This arrangement is cheaper than sending the students to the main campus of the business school. Bringing the schools to the doorstep of the students is more efficient. The key is to have a good brand name, quality modules and learning methodologies and reputable lecturers.
This is good news to Myanmar students because they will have options to pursue quality business education in the country, or use the training to get entrance to education in other English-speaking educational institutions abroad.
Developing local business owners
The outputs of the business schools can be felt a year or two from now as the graduates of these schools enter the workforce and start showing what they have learned. It would be good for the business sector particularly the multinational corporations and the ‘large’ local companies.
Those who will become part of the multinational companies will remain employees and will have a mindset of an employee working on a specific task assigned to them. In essence, most business courses train employees to manage businesses, but it does not train business makers. Business schools train people to think within the milieu of a corporation and its network.
However, the current economic setting of Myanmar can be described as a prevalence of micro-enterprises and several large local businesses and giant multinational corporations. If the current business schools are addressing the needs of the large local businesses and multinational corporations, there is a gap in providing education to the micro-enterprises. This is a big market whose demand nobody is addressing.
The SME sector
More than 90% of registered enterprises in the country are micro-enterprises. There is a wide gap between the ‘ocean’ of micro-enterprises and the very few ‘large enterprises’ that comprise the economy of the country. It does not include the ‘very small’ and informal livelihood activities going on in urban centers without formal registration and are therefore considered part of the ‘underground economy.
Most of these livelihood activities are in the ‘survival’ mode and very risky. As a survival mechanism, people venture into these activities because they have no other choice. These livelihood activities should move from small informal to the level of micro-enterprises where it can further scale up into a more formal and registered small enterprises. At this point, a small enterprise in a regulated environment can now be monitored by the government, it will pay the right taxes and hire a number of staff, contributing to employment generation.
More than the need for funding, it is essential for small enterprises to enhance their competencies and enable them to improve on their operations. Unfortunately, there are very limited training programs for entrepreneurs. There is not even a course on entrepreneurship in the university that would inspire students to become business owners rather than employees.
Myanmar people are not alien to entrepreneurship. The traditional crafts practiced by the people produce commodities that they trade with the neighboring countries prior to colonization. To date, its role as a bridge between two huge economies is an advantage that should be maximized.
But first the country has to adapt to the new business environment where globalization is the name of the game. Business owners have to learn how to enhance existing business, scale it up and expand beyond the country’s borders. This will require training the entrepreneurs to think beyond the confines of their small store or workshop.
Investment in educating Entrepreneurs
Promoting entrepreneurship means setting up a package of support that includes education, financing, product development and marketing support. At present, financing are mostly generated from family members and other informal sources. This is not sustainable because there is a limit to what informal financial sources can provide. Enterprises should be linked with banks for sustained financial support and for scaling up.
Together with financing, it has to be coupled with enterprise education activities. The government can take the lead in initiating training activities for existing business owners on how they can scale up their operations. Those who are keen on scaling up should receive a package of support.
The government can also introduce a degree course in entrepreneurship, offer it in universities and promote taking of these courses. This will ensure that students can have option of being an employee or being an entrepreneur – a business maker. The course can also be made as an elective subject to help students of other courses to appreciate entrepreneurship.
For private educational institutions, this is also an opportunity to offer course for start-up entrepreneurs side-by-side with the MBA courses they offer. A two-pronged approach can be made. First is offering a degree on entrepreneurship for bachelor and post-graduate courses; and second, offering business development training focusing on specific business skills like marketing, accounting, customer services and like, to help improve specific areas in the business. Business owners with improved operations as a result of these training activities will be able to pay for effective interventions. It will be a win-win situation for the educational institution and the entrepreneurs. And of course, the country benefits as the SME sector increase and the economy expands.
