In many working sessions with small and medium-sized enterprises (SMEs), I often hear leaders say:
“We really want to train and develop our employees, but limited budget and time make it impossible to do what large corporations can.”

This is a common sentiment. However, the interesting fact is that SMEs are actually where coaching and mentoring can be most impactful—because their smaller scale makes implementation easier, connections stronger, and results visible right in day-to-day work.

Coaching and Mentoring – What’s the Difference?

• Coaching: focuses on helping employees improve work performance and develop specific skills through questioning, listening, and guiding them to find their own solutions. Coaching is often short-term and linked to immediate tasks.
• Mentoring: emphasizes a long-term relationship in which an experienced person (the mentor) guides, shares perspectives, and provides career direction to the mentee. Mentoring is more about career development and long-term capability building.

In simple terms, coaching is like training someone to run a good sprint, while mentoring is like accompanying them to complete the entire career journey.

Mutual Benefits – Why SMEs Need It Even More

In SMEs, employees often wear multiple hats—learning while doing. This makes coaching and mentoring a truly two-way tool:

• For employees (mentees): they learn faster, make fewer mistakes, and feel valued by leadership, which increases their loyalty.
• For managers (coaches/mentors): they sharpen leadership skills, learn to ask better questions, inspire their teams, and systematize their own experience.

A Deloitte study found that 67% of SMEs with effective mentoring programs retain employees longer, significantly reducing the high cost of recruitment—a persistent pain point for SMEs.

How to Build a “Coaching Culture” in SMEs

The key is not to turn coaching & mentoring into a short-term trend (a few workshops and then stop), but to embed it into a sustainable, practical learning culture.

Some practical suggestions for SMEs:

1. Leaders as role models
   CEOs or middle managers should directly engage in one-on-one coaching instead of leaving it to HR. When employees see their leaders asking questions and listening, they will follow suit.
2. Integrate into daily work
   There’s no need for a separate coaching department. SMEs can embed coaching in team meetings, post-shift feedback, or after completing small projects.
3. Leverage internal staff as mentors
   Experienced employees can serve as mentors for newcomers. Since SMEs rarely have the budget to hire external experts, “internal mentors” are a cost-effective and impactful solution.
4. Measure and recognize
   Set simple goals such as: each manager conducts at least two coaching sessions per month, or every new employee is paired with a mentor for their first three months. And don’t forget to recognize the effort of mentors and coaches—they also need motivation.

Conclusion

For SMEs, where people are the most valuable “asset,” coaching & mentoring is not only a tool for employee development but also a strategy to retain talent and nurture future leaders.

When SMEs successfully build a coaching culture—where every manager knows how to coach, and every employee is willing to share and learn—the organization becomes not only stronger but also more sustainable in a volatile market.

Start with small steps: a one-on-one conversation, a guiding question that helps an employee find their own solution, a mentor willing to share their experience. These small actions will gradually create a strong culture—one that helps Vietnamese SMEs grow and thrive.

Wishing you success,

Lead-UP Academy | Learn to Act – Act to Lead