Māori in business – Where is the trickle down?March 15, 2016 | Markus Schwarzer

Trickle down effect

Māori in Business
Māori (indigenous) economic development for me is an overall indicator how well we are doing in New Zealand.  
I am not Māori nor an expert on Māori Businesses.
However, I have worked with Māori and Pacific Islanders on developing basic business skills at the ‘coal face’.
I can only offer simple observations, having lived and worked in New Zealand for the last 30 years.

 

Trickle-Down-Effect
Trickle down economics is a term used to describe the belief that if high income earners gain an increase in salary, then everyone in the economy will benefit as their increased income and wealth filter through to all sections in society.
Well, looking around, particularly in Northland, New Zealand, I have not seen a lot of evidence of the trickle-down impact.

Māori authorities – Indicative for Business Success?
Within the New Zealand economy Māori businesses include Māori authorities, small- and medium enterprises, and Māori-in-business (self-employed).

Total income for Māori authorities increased $430m in 2012 to $2.9bn in 2013.*
This is a massive increase.

The following graphs look at the growth of Māori Authorities
and how many jobs were created:

Māori Authorities (units) – Indicator for Success?

Maori Authorities growth
Maori Authorities growth (units)

 

 

 

 

 

Total business growth in New Zealand
Total business growth in New Zealand (units)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3 Reasons for Failure
The below reasons are based on my personal observation:

1. Lack of basic Business Skills
Basic business skills are quite often not present – either not been taught or people are reluctant to embrace.
2. Insufficient ongoing Support
Some polytechnics churn out graduates in business but its lacking a proper support network to sustain enthusiasm.
3. Failure to Understand Market and Customers
This is tricky at the best of times – requires the ability to do in-depth research which is quite often beyond people’s capability.

3 Ways to Ensure Success – and to fly like an eagle

1. Essential Business Skills
* Equip people with the basic business skills such as budgeting, cost control and marketing tools.

* I have seen huge development in people once the basic concepts were understood. Sure, some people will embrace it more than others, but once the confidence is built, people move into the ‘business zone’ with more ease than I ever expected.
* The training needs to be ‘hands-on’ right from the start – some could be linked to NZQA unit standards but it’s not vital.

2. Ongoing Support
This is a critical part in the development of business skills because there will be set-backs – some will be painful.
* Therefore a good support network of people with different business skills sets is critical to sustain the effort.
* Ideally an on-going mentoring programme that may include other core skills such communication, how-to research and social media profiling.
* Have a checks & balance system in place that helps people new to business and their mentors objectively check on progress.
* With providing on-going support the commitment (and confidence) will grow – and in turn create a positive outlook.

3. Embed in Local Community
Any Māori (indigenous) or non- Māori business venture needs to be embedded into the local community infrastructure including the local Chamber of Commerce, existing community groups and local business mentors.
*  Develop hand-in-hand partnerships at local level
*  Apply Best Practice methods – use what works
*  Generate local led employment, particularly for Youth

Running a business in isolation is not a good thing.

Do the 3 key areas really ensure success?
Yes, they certainly will go a long way to achieve more favourable results – whilst we hold on for the long-awaited Trickle-Down-Effect:
* Essential Business Skills
* Ongoing Support
* Embed in Local Community
I have seen it seen it first-hand: people looking after budgets, doing research how to reduce costs and teaching others – passing on essential skills.

Contact me for help in your business

 

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