Jeff Heinzmann – In the current climate of budget shortfalls, program cutbacks or outright cuts, the Indiana Small Business Development Centers are working hard to make sure every dollar spent is spent wisely, and every opportunity to leverage ISBDC network and other resources to stretch their impact is examined and, where feasible, implemented.
In three years, the ISBDC network has seen the state matching contribution that comes to it through the Indiana Economic Development Corporation reduced by 70%, from $1,000,000 annually to $300,000 annually. These reductions are more or less on par with other reductions hitting SBDC budgets in other states, so please realize this is not a complaint about an appropriately frugal state budget.
At the same time the Federal core funding for the ISBDC network has increased from $1.8 million to $2.1 million. While that increase reduced the impact of the state funding reductions, it also raised the total amount of matching contributions from our regional partners across Indiana necessary for Indiana to draw down all of the Federal funds available to it. Federal funds not drawn down do not return to the U.S. Treasury, but are instead made available to SBDC programs in other states.
While experiencing these funding challenges, the ISBDC has also seen an increase in performance across all areas. Annual business starts by ISBDC clients are up over 49% form 2007 through 2010, to 249. Job creation reported by clients is up over 188%, from 908 to 2,623 over the same period. Total capital infusion from 2007 through 2010 has grown 64.33%, from $37 million to $61 million. Finally, the number of clients the ISBDC works with over the course of multiple years has grown 69%, from 693 in 2007 to 1,173 in 2010.
So with less money, the ISBDC has been generating better results, with a greater positive economic impact. How?
We have first and foremost focused on our core function, a la Jim Collins’ book, Good to Great. Our primary focus is to have trained business advisors with access to state of the art resources focused on helping businesses thrive and grow.
Because those business advisors have limited time and time is a precious commodity, we seek to have our clients first go through an online assessment at www.isbdc.org. This helps us know what the client knows, where they are, and what they might need before anyone sits down with an advisor. A better prepared client and a better prepared business advisor are the result.
Third, we have reduced our overhead through the consolidation of two regional headquarters while still maintaining full-time business advisor staff in Kokomo and Bloomington. This reduced administrative and overhead costs to the ISBDC network while maintaining the capability to serve entrepreneurs in these communities.
Finally, we have entered into two unique co-hosting arrangements for our regional ISBDCs in Southeast and Northwest Indiana, where IU, Ivy Tech, and Purdue have joined together to ease the burden of providing the minimum amount of matching funds while at the same time vastly expanding the physical and intangible resources available to the ISBDC network in those regions and beyond. It is our hope and expectation that other regions might follow suit to continue the expansion of the ISBDC network as an entrepreneurial resource to Hoosier businesses without increasing the cost to Indiana taxpayers.
Jeff Heinzmann is the State Director for the Indiana Small Business Development Center, an organization with the mission of having a positive and measurable impact on the formation, growth, and sustainability of small businesses in Indiana, and to develop a strong entrepreneurial community. Jeff can be reach at email@example.com.