Modernization and Growth of a Small Business

This article aims at pointing out at crucial factors for successful small business owners. A short guide for modernization as a way of moving forward, constant learning and development of business as well as business owner.

Modernization and Growth of a Small Business

Small Business and Modernization as a Key Factor

Entrepreneurship can be defined as a process within which an individual or group identifies the idea, plans, and implements it in practice to pursue an individual or common interest. The entrepreneurial process is a complex endeavor, undertaken by persons living in specific cultural and social conditions, at the same time a complex undertaking which is influenced by many factors, including prevailing attitudes within society, activity rate and type of opportunities available, as well as entrepreneurial growth expectations.

The most oftentimes used criterion for outlining an organization is that the indicator of the number of workers. This criterion primarily is applied as a result of it's simply measurable, transparent, it's proof against inflation, which is why it's accessible in the least corporations.

Tiny and medium-sized enterprises (SMEs) manifest their influence through many indicators of the country's development; particularly, they encourage employment, contribute to the expansion of recent values, affect to increase value, produce assumptions for aggregation tax revenues, etc.

Development Stages

Businesses will implement an intensive growth strategy of three various methods, that include:

Market penetration - aims to extend sales of current merchandise within the existing market with the applying of aggressive promoting tools.

Market development - this strategy is targeted at the sale of existing merchandise in new markets during which firms haven't performed.

Product development - development strategy that focuses on developing new merchandise that is sold within the existing market.

Modernization of Small Business

This strategy is focused on enterprise growth based on the modernization of equipment, technology, and human resources knowledge. What is the significance of the company's focus on we see modernization from the decision of the EU Council, which bases its growth on a modernization strategy?

Innovation is vital to developing new products and services, in addition to building a competitive advantage. This strategy improves structure processes and models, taking into consideration the larger sensitivity and flexibility of the enterprise. This sort of strategy is applied by those corporations that are committed to researching the wants of shoppers, to deliver the most worth to shoppers within the kind of product or service.

The modernization strategy is predicated on innovations that are the key to business growth and might be divided into 5 stages:

  1. Introduction of a fully new product or modifications of an existing product,
  2. Introduction of a brand-new production methodology,
  3. Gap new markets for existing products,
  4. Adoption of the latest raw materials and their application in production,
  5. Making a brand-new kind of industrial organization


BOOK: Menadžment malih i srednjih preduzeća - Dr. sc. Suvad Isaković, 24,31 ... 978-9958-639-67-8

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