What Makes a Good Assessment Tool?
Assessing Business
Small Business- While current discourse often characterizes small and micro-enterprises as having limited capital, low productivity, and minimal growth, the reality of the matter shows that the world’s small businesses’ informal and often irregular operations are driven more by the necessity of income than by the pursuit of building any formal business. Take, for example, Baby Devi or Maya Gupta —two women running successful businesses from their homes in Delhi NCR.
Photo courtesy of Access Team Member Shika
Baby Devi, a 44-year-old woman, has been running a home-based tailoring business in Gurgaon, Haryana, for the past 14 years. Her enterprise, Priya Silai Center, has been a steady source of income for her family. Though she has no signage, collateral, or formal marketing strategy, which most business assessments consider essential, she (like many) has built strong relationships with her customers and runs her business on her own terms.
Similarly, Maya Gupta and her sister-in-law have been managing a small retail clothing shop, “Pitamara Fashion,” from their home in Palam, Delhi, for the past three years. Like many women entrepreneurs, they juggle business with family life, often relying on Maya’s teenage daughter to manage digital payments through her personal account. This mix of personal and family finance with business life and operations is rarely captured in most formal business assessments, which are predicated on the belief that entrepreneurs manage their finances independently.
In this blog, I aim to explore present-day business assessments and analyze the ways in which formality and standardization have prevented these assessments from delivering useful guidance at the grassroots level. As we compare these traditional structures to the lived realities of women running small businesses across varying degrees of formality, we find that many existing business tools operate on core assumptions about access and knowledge that simply don’t hold for businesses operating at the last mile.
A History: The Landscape of Nano Enterprises and the Gender Gap
Today in India, nearly 40% of the nation’s GDP is produced by small businesses (IIFL Finance). The sector formally deemed as “ Micro, Small, and Medium Enterprises (MSMEs)” covers all businesses with an annual turnover of less than approximately USD 1.2 million ( ₹10 crore). In reality, the majority of India’s small businesses operate far below this ceiling (MSME Desk). Recent estimates suggest that 96% of India’s micro-enterprises earn under 130 thousand dollars annually (₹1 crore), placing them in what could more accurately be described as the nano-enterprise category (a category to this day that is not formally recognized by the government)(MSME Desk). These businesses, often small, local, and community-based, face challenges that far exceed the scope of most national MSME support policies.
This is especially true for women. Around 20% of India’s 63 million micro, small, and medium enterprises (MSMEs), are women-owned, employing 22 to 27 million people (Roy, pg.2). For women, these enterprises are typically informal by necessity: they allow women to manage the dual burden of unpaid household labor and income generation. For many, this flexibility is the only viable option.
Take Noor Jaha, a single mother who lives and works from her home in Sangam Vihar, crafting jute, tote, and phone bags. She has been operating her business, “Iqra Boutique,” for five years. High rent and the lack of supplemental income have made it difficult for her to save and reinvest her earnings. The prevailing assumption that these businesses simply lack the capacity to scale or adopt “good” business practices fails to account for the structural and institutional barriers women face.
Photo Courtesy of author
At ACCESS Development Services, we have spent the past year working closely with women-led nano-enterprises across Delhi to better understand these constraints. What we’ve found is a consistent demand, not just for financial inclusion, but for tools that reflect and respect the lived experiences of women in informal work. Current government and market interventions often overlook the diversity and specificity of nano-enterprises, especially those run by women. In response, we’ve begun designing an enterprise assessment tool tailored to this reality—one that doesn’t just diagnose business health, but equips women to understand, manage, and grow their businesses on their own terms. For these entrepreneurs, empowerment begins not with formal classification but with being supported where they are.
Rethinking Business Assessments for Women Managing Informal Enterprises
Today, digital tools are helping reshape the landscape of business growth across the world. The online nature of these tools allows institutions to automate the assessment process, providing results to understand a business’s standing in real time, with some tools even going a step further to automate the hand-holding processes to scale, offering strategies for growth to the business in real time (Jeroen).
Digital tools for business typically serve two primary functions. The first (more common among informal enterprises) focuses on assessing individual capabilities like ests for financial management practices and knowledge of day-to-day business operations. These assessments measure best practices and give feedback on one’s abilities to save, track inventory, engage with customers, or conduct other day-to-day business practices. While these capability assessments measure the degree of specific practices taking place within Small and nano businesses, holistic tools that measure overall business performance for MSMEs are far and few to come by. Why? Because measuring business in different degrees of formality is challenging.
The second type of assessment we often see is at a formal or semi-formal level, where the tool is a business assessment and evaluates the overall entity—the business’s financial health, growth trajectory, operational efficiency, and strategic positioning, etc. These business assessments can help entrepreneurs and SME managers/owners to recognize their business performance gaps and management challenges by channeling them to sources of appropriate guidance and support (OECD SME and Entrepreneurship Papers, pg.8 ). Whether the entrepreneur is seeking credit, investment, or scaling opportunities for their business these tools often assist institutions aiming to provide a service to the enterprise. Furthermore, more issues inherently arise with the assessment’s comprehension as these tools naturally assume a certain degree of structure, documentation, and formalization in a business that doesn’t always apply to businesses operating at the last mile.
So, how do we bridge this gap? What kind of tool would fit this need? What would it look like? As we look more critically at enterprise assessment tools, we can begin to break them down using the The Organisation for Economic Co-operation and Development (OECD’s) three diagnostic dimensions: the tools Objectives and Target Users, methods of Benchmarking or Assessing, and lastly its Intensity of Use (OECD SME and Entrepreneurship Papers, pg. 21). By using these three dimensions to assess present day business assessments, we can understand what design would best fit the needs of women running Micro and Nano enterprises.
Understanding Current Tools
The SWOT Analysis: SWOT analysis, stands for strengths, weaknesses, opportunities, and threats, helps business owners evaluate their internal and external environment and identify the factors that will help or hinder their success” (E.U. strategic management).
Objectives and Target Users
The SWOT analysis is generally designed for entrepreneurs or managers who demonstrate a working understanding of their business’s internal operations and external market context. SWOT operates on the assumption that users can assess their strengths, customers, competition, and long-term plans, a level of insight most last-mile businesses haven’t had the chance to develop.
At ACCESS, we explored how tools like the SWOT analysis could support our participants in strengthening their businesses. During our team training of field staff, we were taught the difference between someone who is self-employed, generating money for themselves, and someone who is running a business, a commercial activity focused on generating profits. However, discussions and insights from the field revealed that this distinction is often blurred, particularly within the context of projects aiming to advance women-run enterprises. Many women do not identify as business owners, which limits their confidence and perceived capabilities. Our training sessions emphasize that these women are indeed running enterprises and taking charge of their livelihoods.
After our business training on the SWOT, we introduced these concepts during one of our capacity-building sessions with women micro and nano enterprises, trying to enhance women’s understanding of saving, investment, and business goals. Despite early excitement and partial adoption, it was clear that the road to teaching the overall business analysis would be long and potentially irrelevant for those not wishing to scale. It was like trying to fit a square peg in a round hole, where lofty terms could be useful, but they didn’t resonate with participants, as the practices in their daily life didn’t translate to those proposed..
Benchmarking and Assessment Method
SWOT is a qualitative, self-assessment tool, but it lacks clear behavioral benchmarks or structured guidance. It relies heavily on the user’s ability to self-analyze and categorize their business’s characteristics into predefined slots. For entrepreneurs with limited exposure to formal business practices, this can make the tool feel abstract and unhelpful.
Photo Courtesy of Author
Take Anita Devi, for example. She runs a small food cart in Holambi Kalan, selling ready-made meals and operating a tiffin service with her husband’s support. Despite having a solid customer base of around 50 daily customers, Anita struggles with formal business practices like bookkeeping, inventory management, and marketing. Although she is part of ACCESS’s capacity-building program, there is still a gap in her understanding of how her business functions and how she can formalize and grow. Like many women entrepreneurs, Anita’s household and business finances blur together, limiting her control over profits and her ability to reinvest. Tools like SWOT do little to address these lived realities because they assume a baseline of business knowledge and independent financial management that women like Anita often lack.
Without clear guidance, structured benchmarks, or actionable steps, SWOT remains abstract, especially when there’s no facilitation or follow-up to ground its insights in real practice. As the Institute of Leadership and Management notes, this kind of tool assumes foundational business knowledge. Before you can “spell the word Apple,” you need to know your ABCs.
Intensity of Use
In terms of intensity, SWOT is considered a light-touch tool. It’s typically filled out during a workshop or planning session, often on paper or through a static template. While there’s minimal time required, the fact that there is no follow-up services or teaching materials for the tool makes it hard to comprehend if delivered independently.
Conclusion
In short, while the SWOT analysis is widely used, it is not well-suited to women-led informal enterprises. Its abstract framing, lack of embedded learning, and assumption of strategic fluency limit its usefulness for those operating without formal education, digital infrastructure, or prior exposure to structured business development tools. This gap highlights why we need tools that do more than just assess tools, but also teach.
ACCESS’s Enterprise Assessment Tool
Today, there is a clear need for a tool built for women by women to address their specific needs. One that operates in the middle ground, between tests of capacities and abilities, and tests of business functions and operations. The future of women-led enterprises depends on tools that don’t just assess success but actively enable it. An assessment that can expand and collapse with the user based on their demonstrated skill sets, where more details are provided only if they demonstrate competency. If we want women-led enterprises to thrive, we must stop forcing them into systems that don’t fit and start building tools that meet them where they are.
Women entrepreneurs need a tool that is qualitative and quantitative, giving deep and diverse insights while still being light, tough, and of limited use. As we have worked to develop and design our Enterprise Assessment for Women-run SMEs in Delhi NCR, we’ve run into a host of challenges. Needing to design a tool that doesn’t screen or select businesses for external validation, but supports capacity-building through assessment. Drawing on the pre-defined Budhi Money Didi pedagogy, the tool captures business practices in language and scenarios that reflect everyday decision-making, not abstract theory.
Objectives and Target Users
The primary goal of the Enterprise Assessment Tool is to promote learning and self-improvement among women-led micro and nano enterprises, many of whom operate informally and are excluded from conventional support systems. We intentionally targeted a broad user group: women running businesses across varying levels of formality and scale. We quickly realized a need for specifying an issue that can be mitigated with a user log-n, where we identify the scale of the enterprise and ensure that the questionnaire recommendations are relevant and applicable to the specific enterprise type. The tool needed to work for a home-based tailor just as well as for a market vendor or service provider. By centering the user’s experience and employing learning from the full population of women MSMEs, we aim to create a tool for all.
Benchmarking and Assessment Method
Unlike standard financial assessments that rely on metrics like turnover, debt ratios, or balance sheets, our tool uses a qualitative, behavior-based method. It focuses on observable management practices—like saving habits, customer interaction, and decision-making processes—that reflect how women actually run their businesses.
We drew from the Budhi Money Didi pedagogy, using simple, scenario-based questions rooted in real-life business situations. This method allows women to engage with the tool without needing technical vocabulary or formal records. The assessment adapts to each user through conditional logic, expanding to more detailed questions only when the entrepreneur demonstrates familiarity with the topic. This dynamic design helped ensure the tool wasn’t overwhelming for first-time users while still being comprehensive for those with more experience.
Intensity of Use
We aimed for a medium-intensity tool—substantial enough to provide a meaningful assessment but light enough for women to use independently, on their own time. The tool is deployed through a mobile app, offering an intuitive, visual interface that respects the time constraints and digital access limitations faced by many women entrepreneurs.
Importantly, we designed the tool not as a one-off assessment, but as a learning companion allowing users to revisit it, track their growth, and reflect on their practices over time. By embedding actionable feedback and practical guidance within the tool, we hoped to make it both accessible and useful without requiring intensive facilitation.
What We Learned Along the Way
While we remain proud of the progress we’ve made, the process of designing this tool taught us just how difficult it is to strike the right balance between assessment and learning.
We learned that:
- A tool must be built on a clear, practice-based learning pedagogy if it is to move beyond mere assessment and actually empower entrepreneurs.
- A one-size-fits-all tool won’t work. Conditional design, where the tool adapts to a user’s demonstrated knowledge and confidence, was essential, but technically challenging.
- Even with adaptive design, creating a tool that feels both manageable and meaningful requires ongoing iteration and user feedback.
Our experience has underscored that good tools are never static; they are evolving, responsive, and shaped by the realities of those who use them. As we continue refining the Enterprise Assessment Tool, we remain committed to learning from the entrepreneurs themselves. Because if we want tools that empower women at the last mile, they must reflect the complexity, challenges, and aspirations of real business owners, not just institutional goals.
