Small Business Training to Improve Management Practices in Developing Countries

Small Business Training to Improve Management Practices in Developing Countries

Despite the popularity of business training among policy makers, the use of business training has faced increasing skepticism. This is, in part, fueled by the fact that most of the first wave of randomized experiments in developing countries could not detect statistically significant impacts of training on firms' profits or sales. This paper revisits and reassesses the evidence for whether small business training works, incorporating the results of more recent studies. A meta-analysis of these estimates suggests that training increases profits and sales on average by 5 to 10 percent. The author argues that this is in line with what is optimistic to expect given the relatively short length of most training programs, and the expected return on investment from the cost of such training. However, impacts of this magnitude are too small for most experiments to detect statistically. Emerging evidence is provided on five approaches for improving the effectiveness of traditional training by incorporating gender, kaizen methods, localization and mentoring, heuristics, and psychology. Training programs that incorporate these elements appear to deliver improvements over traditional training programs on average, although with considerable variation. Given that training delivers some benefits for firms, the challenge is then how to deliver a quality program on a cost-effective basis at a much larger scale. Three possible approaches to scaling up training are discussed: using the market, using technology, or targeting and funneling firms.

Saved in:
Bibliographic Details
Main Author: McKenzie, David
Format: Working Paper biblioteca
Language:English
Published: World Bank, Washington, DC 2020-09
Subjects:BUSINESS TRAINING, MICROENTERPRISES, MANAGEMENT PRACTICES, SOFT SKILLS, ENTREPRENEURSHIP EDUCATION, KAIZEN METHODS, MENTORING, PSYCHOLOGY,
Online Access:http://documents.worldbank.org/curated/en/593081600709463800/Small-Business-Training-to-Improve-Management-Practices-in-Developing-Countries-Reassessing-the-Evidence-for-Training-Doesn-t-Work
https://hdl.handle.net/10986/34506
Tags: Add Tag
No Tags, Be the first to tag this record!
id dig-okr-1098634506
record_format koha
spelling dig-okr-10986345062024-08-09T06:14:14Z Small Business Training to Improve Management Practices in Developing Countries Reassessing the Evidence for 'Training Doesn’t Work' McKenzie, David BUSINESS TRAINING MICROENTERPRISES MANAGEMENT PRACTICES SOFT SKILLS ENTREPRENEURSHIP EDUCATION KAIZEN METHODS MENTORING PSYCHOLOGY Despite the popularity of business training among policy makers, the use of business training has faced increasing skepticism. This is, in part, fueled by the fact that most of the first wave of randomized experiments in developing countries could not detect statistically significant impacts of training on firms' profits or sales. This paper revisits and reassesses the evidence for whether small business training works, incorporating the results of more recent studies. A meta-analysis of these estimates suggests that training increases profits and sales on average by 5 to 10 percent. The author argues that this is in line with what is optimistic to expect given the relatively short length of most training programs, and the expected return on investment from the cost of such training. However, impacts of this magnitude are too small for most experiments to detect statistically. Emerging evidence is provided on five approaches for improving the effectiveness of traditional training by incorporating gender, kaizen methods, localization and mentoring, heuristics, and psychology. Training programs that incorporate these elements appear to deliver improvements over traditional training programs on average, although with considerable variation. Given that training delivers some benefits for firms, the challenge is then how to deliver a quality program on a cost-effective basis at a much larger scale. Three possible approaches to scaling up training are discussed: using the market, using technology, or targeting and funneling firms. 2020-09-24T20:39:50Z 2020-09-24T20:39:50Z 2020-09 Working Paper Document de travail Documento de trabajo http://documents.worldbank.org/curated/en/593081600709463800/Small-Business-Training-to-Improve-Management-Practices-in-Developing-Countries-Reassessing-the-Evidence-for-Training-Doesn-t-Work https://hdl.handle.net/10986/34506 English Policy Research Working Paper;No. 9408 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank application/pdf text/plain World Bank, Washington, DC
institution Banco Mundial
collection DSpace
country Estados Unidos
countrycode US
component Bibliográfico
access En linea
databasecode dig-okr
tag biblioteca
region America del Norte
libraryname Biblioteca del Banco Mundial
language English
topic BUSINESS TRAINING
MICROENTERPRISES
MANAGEMENT PRACTICES
SOFT SKILLS
ENTREPRENEURSHIP EDUCATION
KAIZEN METHODS
MENTORING
PSYCHOLOGY
BUSINESS TRAINING
MICROENTERPRISES
MANAGEMENT PRACTICES
SOFT SKILLS
ENTREPRENEURSHIP EDUCATION
KAIZEN METHODS
MENTORING
PSYCHOLOGY
spellingShingle BUSINESS TRAINING
MICROENTERPRISES
MANAGEMENT PRACTICES
SOFT SKILLS
ENTREPRENEURSHIP EDUCATION
KAIZEN METHODS
MENTORING
PSYCHOLOGY
BUSINESS TRAINING
MICROENTERPRISES
MANAGEMENT PRACTICES
SOFT SKILLS
ENTREPRENEURSHIP EDUCATION
KAIZEN METHODS
MENTORING
PSYCHOLOGY
McKenzie, David
Small Business Training to Improve Management Practices in Developing Countries
description Despite the popularity of business training among policy makers, the use of business training has faced increasing skepticism. This is, in part, fueled by the fact that most of the first wave of randomized experiments in developing countries could not detect statistically significant impacts of training on firms' profits or sales. This paper revisits and reassesses the evidence for whether small business training works, incorporating the results of more recent studies. A meta-analysis of these estimates suggests that training increases profits and sales on average by 5 to 10 percent. The author argues that this is in line with what is optimistic to expect given the relatively short length of most training programs, and the expected return on investment from the cost of such training. However, impacts of this magnitude are too small for most experiments to detect statistically. Emerging evidence is provided on five approaches for improving the effectiveness of traditional training by incorporating gender, kaizen methods, localization and mentoring, heuristics, and psychology. Training programs that incorporate these elements appear to deliver improvements over traditional training programs on average, although with considerable variation. Given that training delivers some benefits for firms, the challenge is then how to deliver a quality program on a cost-effective basis at a much larger scale. Three possible approaches to scaling up training are discussed: using the market, using technology, or targeting and funneling firms.
format Working Paper
topic_facet BUSINESS TRAINING
MICROENTERPRISES
MANAGEMENT PRACTICES
SOFT SKILLS
ENTREPRENEURSHIP EDUCATION
KAIZEN METHODS
MENTORING
PSYCHOLOGY
author McKenzie, David
author_facet McKenzie, David
author_sort McKenzie, David
title Small Business Training to Improve Management Practices in Developing Countries
title_short Small Business Training to Improve Management Practices in Developing Countries
title_full Small Business Training to Improve Management Practices in Developing Countries
title_fullStr Small Business Training to Improve Management Practices in Developing Countries
title_full_unstemmed Small Business Training to Improve Management Practices in Developing Countries
title_sort small business training to improve management practices in developing countries
publisher World Bank, Washington, DC
publishDate 2020-09
url http://documents.worldbank.org/curated/en/593081600709463800/Small-Business-Training-to-Improve-Management-Practices-in-Developing-Countries-Reassessing-the-Evidence-for-Training-Doesn-t-Work
https://hdl.handle.net/10986/34506
work_keys_str_mv AT mckenziedavid smallbusinesstrainingtoimprovemanagementpracticesindevelopingcountries
AT mckenziedavid reassessingtheevidencefortrainingdoesntwork
_version_ 1807157541440847872

Similar Items