Enterprise Facilitation: Growing Entrepreneurs One Contact at a Time

Article by Patty Clark
Director of Community Development
Kansas Department of Commerce

Owning your own business is the dream of many Americans, and more Americans than ever are taking advantage of opportunities to become entrepreneurs. This trend is especially promising for rural communities, where homegrown businesses are fuelling economic growth a handful of jobs at a time.

Like other rural places in the Great Plains, many small, agriculture- based Kansas communities have been losing population as the next generation chooses not to return to the farm. However, new and exciting efforts are under way to create economic opportunities in Kansas from the inside out. Many of these initiatives began at Prosperity Summits – interactive workshops held around the state about the future of economic development in Kansas – at which there was a resounding call to focus time, energy and resources on the rural communities that are the state’s backbone. One of these initiatives is “Enterprise Facilitation,” a concept the Kansas Department of Commerce implemented in 2001 to help rural entrepreneurs get started and keep their businesses thriving.

Few people had heard of Enterprise Facilitation at that time. The brainchild of Ernesto Sirolli, founder of the Sirolli Institute in Sacramento, California, Enterprise Facilitation is a model that cultivates a “barn-raising”mentality among citizens, which can then be applied to business development. Sirolli’s program is being used successfully in rural areas throughout the United States, Canada and Australia. The Kansas Department of Commerce contracted with the Sirolli Institute to use its regional approach to economic development in Kansas.

Enterprise Facilitation uses the best resource rural Kansas has – its own citizens – to jumpstart the process of increasing local capacity. Business owners are motivated by different needs, but those taking advantage of entrepreneurial networks such as Enterprise Facilitation generally fall into these categories:

• Lifestyle entrepreneurs – individuals with a desire to live in or move to rural communities and would like to see their quality of life and communities prosper through more job creation.
• Growth entrepreneurs – existing entrepreneurs who want to enhance their communities by expanding businesses to create more jobs and better resources.
• Immigrant entrepreneurs – second and third generation immigrants who possess a desire to become successful business owners and operators.
• Transitional entrepreneurs – agricultural producers who must transition to more value-added and direct marketing business creation, and former employees of manufacturing firms who have lost their jobs to out sourcing or downsizing.
• Youth entrepreneurs – enthusiastic and less risk-averse youth who want to start their own businesses.

Through Enterprise Facilitation, communities take ownership of their future and create an entrepreneurial culture in a system-based, accountable approach to business and job creation.While still in their early stages, these projects are already showing promise not only as a way to create new jobs but also as a way to create a renewed sense of community.

There are now five separate Enterprise Facilitation projects throughout Kansas, organized in groups of five to six counties:Western Kansas (including Wichita); Prairie Enterprise Project, in central Kansas; Sunflower, in south central Kansas; QUAD, in the Southeast; and Northeast Kansas. Each region faces unique challenges and opportunities, but by drawing on local resources, they are finding success.

How Enterprise Facilitation works

Enterprise Facilitation operates under the premise that an individual possesses the skills and passion to perform one or possibly two functions of operating a business – marketing, production or financial management – but can’t operate a business effectively without assistance in those areas where talent or passion are lacking.

Communities start by forming an Enterprise Facilitation board that is a broad representation of the communities and various stakeholders within their region. Citizens are invited to serve on this board and are interviewed by consultants from the Sirolli Institute. Between 35 and 50 citizens are selected and each citizen must attend board training sessions, which are the first step in developing local capacity. The board is engaged, in a confidential way, to use local knowledge and resources to help entrepreneurs create a product or service, market it, or build financial management capacity.

The board receives training from the Sirolli Institute on developing policies and board member responsibilities and on recruiting an Enterprise Facilitator. A professional search is conducted to hire the Enterprise Facilitator, who along with the new board members, receives one-week, in-depth training to build local capacity. Key among the responsibilities of the board is the personal commitment board members make to introduce the Enterprise Facilitator to 10 people each. This creates a network through which potential entrepreneurs can learn that a free, confidential service is available, and the Enterprise Facilitator can learn of entrepreneurs who are looking for assistance. The goal is not only to make connections in the short-term but to create a sustainable, long-term network for entrepreneurship.

The Enterprise Facilitator makes connections between entrepreneurs and various people in the community who can assist with business development. Facilitators rely on the introductions of their board members to advertise their services and let the entrepreneur initiate the working relationship. The board training and salary of the Enterprise Facilitator are paid with funds raised locally from local public and private sources.

One example of Enterprise Facilitation at work is the experience of Diamond S Manufacturing in Eureka. Mark and Denise Stewart are not typical entrepreneurs. Mark owns a ranching operation and a manufacturing and welding business, while his wife Denise operates a family-owned retail store, a Laundromat and oversees several rental properties.

The Stewarts were familiar with the type of help available through Enterprise Facilitation. They saw the opportunity to combine what they were doing at Diamond S Manufacturing with the services provided by Denner Welding, a long-time Eureka business whose owners were ready to retire.Without a buyer for the business, the community would lose a shop for farm equipment repair and other services the Denners had provided.With the help of the QUAD Enterprise Facilitator, the Stewarts negotiated a deal to purchase all the assets of Denner Welding and expand their operation in Eureka. This helped retain jobs that otherwise would have been lost, and also maintained valuable services in the community.

The benefits for Kansas communities

Enterprise Facilitation creates jobs, draws together resources and helps companies prosper. Perhaps equally important, it also can provide a reality check for entrepreneurs who are looking to get started. They may realize after talking to the Enterprise Facilitator and putting a plan in writing that their business might not be profitable, an assessment that ultimately can save money and effort from being put into an enterprise that is unlikely to succeed. It isn’t the Enterprise Facilitator’s role to tell the entrepreneur if the idea will work or not, but the Facilitator can help the person to put the pieces of the business puzzle together to determine the chances of success for themselves.

To date, using $1.26 million in state investment and approximately $312,000 in local investment, Enterprise Facilitation projects have assisted 663 clients, created 64 businesses, retained 34 businesses, expanded 20 businesses, and created or retained 302 jobs. After initial setup of an Enterprise Facilitation project, the cost per job created averages less than $3,000. For rural Kansas, that’s money well spent.

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