Incubator without Walls: An Enterprising Outlook on the Road
Mobile health screenings, bloodmobiles and bookmobiles all take their services directly to the streets, directly to the people. A business development organization based in Macon, Mo., also is hitting the road to meet new customers in rural communities. The approach has become known as an "incubator without walls." As the first incubator without walls in Missouri, the Thomas Hill Enterprise Center began in 1993. At that time, its mission was to assist people displaced from jobs by the closing of the Thomas Hill coal mine. The intent was to stabilize the area through job placement and economic development services. Over the past few years, small business development has moved to the forefront of its activities. The goal of the center now is to assist small businesses and small communities to become part of the growing state and global economy.
Today, the Enterprise Center is a small business training center designed to provide assistance for start-up or existing businesses using a mobile computer learning lab and electronic online resources. The center is a nonprofit private corporation funded by several public and private partners including: Missouri's Rural Electric Cooperatives, the U.S. Department of Agriculture-Rural Development, the Missouri Department of Economic Development, GTE, NationsBank, the Small Business Administration and Truman State University.
The Enterprise Center has become a recognized leader in rural development strategies that build better communities through enhancing hard and soft skills. It promotes entrepreneurship through the development and delivery of programs designed to teach hard skills like business planning and finance and soft skills like entrepreneurial thinking and process management. In some cases, the center also offers financing.
Incubating Skills and Ideas
Early in 1998, Enterprise Center Director Jane Vanderham began thinking that long-lasting solutions might come better by providing more opportunities for nurturing rural community members to develop their own entrepreneurial way of thinking. Vanderham said, "It's the ability to vision and understand the vision that is the difference between the computer hacker and a Bill Gates."
At Thomas Hill, enterprise development means that the root of teaching enterprise in rural areas includes a combination of civics and critical thinking skills. These "soft skills" enable people to conceive jobs and livelihoods that fit into the local and global communities.
"We have to know how to approach problems prior to encountering them be they political, economic, social or cultural in nature," Vanderham said.
Thomas Hill offers courses in Quickbooks, Peachtree Accounting and Quicken to help small business owners with accounting and finance problems. But these problems are only symptoms of a more permeating disease, Vanderham said. That disease is the lack of a thought process that allows the entrepreneur to become poised to make timely and appropriate business decisions. The Enterprise Center teaches process management, the ability to know what to anticipate.
One of the most significant challenges in rural development is delivering services to customers dispersed over many miles. How does one meet a wide range of needs and deliver intangible service products across many miles without the benefit of customer density? The development of the Center's online EnterpriseNet was one first-stage tool created in response to this challenge. The EnterpriseNet is an electronic resource center for business planning placed in a delivery channel for a dispersed rural market. EnterpriseNET is a portable and state-of-the-art computer lab offering customized training. The portability enables the center to train small-town entrepreneurs who do not have the advantage of receiving training without traveling to class. Short courses have included: forecasting for small manufacturers, customer service and marketing strategies.
The Enterprise Center is bringing down the walls for lenders as well. The center formed a partnership with the Gateway Region American Institute of Banking in 1998 to, among other things, train rural community bankers in the use of certain accounting and finance software. These bankers would otherwise have to go to St. Louis for this training.
Mind Your Ps and Cs
In the mix of various hard and soft skill levels, approaches and outlooks, what has Thomas Hill learned about developing enterprise? Mainly, that all entrepreneurs have a need for a long-term banker. Vanderham suggests that the crux of community lending includes an emphasis on developing entrepreneurs through financial counseling and business assistance in addition to applying the five Cs of lending (capital, character, collateral, capacity and condition).
Looking forward, Vanderham said one of the greatest market opportunities in rural areas is for community banks to understand how to improve the performance of an existing underperforming business. She stated that entrepreneurial lending should begin with the three Ps of entrepreneurship—planning, patience and profitability. To ensure business growth, the three Ps should be followed by two other Cs—continuity and constancy. "Constancy is particularly important for incubation," Vanderham said. "Alter the temperature, and you'll get less than desired results."
Bridges is a regular review of regional community and economic development issues. Views expressed are not necessarily those of the St. Louis Fed or Federal Reserve System.
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