The Entrepreneurial OrganizationThe 20th century was heavily influenced by entrepreneurs like Henry Ford and Bill Gates. But because of the way those guys had to leverage their vision, with lots of people, buildings, factories, and capital, the last century actually became the century of the major corporation.
In the 21st century, which I call The Century Of The Entrepreneur, entrepreneurial leverage is, and will be, a lot different for a number of reasons. But I want to focus on what I consider to be four big factors that will create not only entrepreneurs, but also entrepreneurial organizations:
Shifts in these four areas are creating fertile soil in which to grow entrepreneurial organizations of all sizes and all forms. Before we talk about these factors, let's get a couple of definitions on the table. First, entrepreneur.
What's your definition of an entrepreneur? Webster says an entrepreneur is, "Anyone who assumes the risks of business for the sake of profit." The word, entrepreneur, has become quite evident in our lexicon in recent years. It's an excellent word that has a noble ring and makes a strong impression.
Some words or terms have the tendency to be over-used and consequently, become cliché, like paradigm or new economy. So far, entrepreneur is wearing well, and I think it's because it's still being defined; we're still finding ways to use it. For example: entrepreneurial employee. Do you think there is such a being?
The complete unabridged Blasingame Dictionary defines an entrepreneur employee as: "Anyone who employs vision, information, initiative, and planning to accomplish personal goals through the resources of his or her employer's organization."
If you accept this definition, then you don't have to leap too far to accept the Blasingame Dictionary's definition of entrepreneurial organization, which is any organization:
1. That is structured so that its members are given the information and tools necessary to allow each to pursue solutions and take advantage of opportunities at their level, based on the stated objectives of the organization.
2. Where an atmosphere exists that encourages individual initiative, and mistakes and failures that occur in the process of taking initiative are actually viewed as progress in the personal and organizational quest for excellence.
I believe the successful organizations in the 21st century, whether for profit or otherwise, will fit this definition.
Unfortunately, many organizations have not yet made the transition from the dominator management model to the partnership model, the latter of which is essential to creating an entrepreneurial environment. The challenge for you and me as owners and managers is to make the conversion without creating a casualty list. Perhaps the first step is to understand why the 21st century soil is so fertile for entrepreneurs and entrepreneurial organizations. Which brings us to those four factors I mentioned earlier.
When I started my career, I typed letters and proposals on an Underwood 5 manual typewriter. Today, it's a boat anchor compared to my 15th generation desktop computer and software. And not only is the creation of information vastly improved, but so is the delivery of that information. Thanks to the World Wide Web, email, and the Internet, I can send proposals as attachments in an email to my customers and prospects across town, cross-country, and around the world. Technology has come a long way in 30 years.
Not only are we employing technology, but we are also expecting more and more out of it. My first computer had 128K of RAM, NO hard drive, and I thought it was a magic box. Now I get upset if my 700Mhz computer takes 3 nanoseconds too long to access a website on the other side of the planet.
Impatience with the capability we have, and hungry anticipation for the next level of capability, are traits of an entrepreneur. Capability is power; it empowers those in its possession. Every day our employees gain more individual capability through technology, and they are going to want to do more exciting things with that capability. That desire is the spark of entrepreneurialism that has more to do with wanting to take initiative and professional risks than it does with being an owner.
Entrepreneurial organizations will thrive in an environment of emerging technologies. Will yours be one of them?
The SBA says Americans are starting almost 800,000 new businesses every year, and estimates that number to grow to 1 million per annum by 2010. A Kaufman Center for Entrepreneurialism study showed that more people than ever before now view business ownership positively, and that one in twelve employees in the U.S. are seriously considering starting a business. Why do you think that one in twelve would want to do that?
Because taking risks and initiative in the marketplace is exciting.
But what about those other eleven employees - wouldn't they want some of that action, too? Absolutely. But they are the ones who will be our best employees if they believe they can be creative and take risks and initiative working for us.
Are you going to be able to deliver that opportunity for them? Not unless you provide them with an entrepreneurial organization.
Do you know how many teleworkers there are in America today? Some estimates put it at more than 20 million, including those who do it every day and those who work from home occasionally.
Furthermore, it has been estimated that there may be as many as 25 million home-based businesses, and perhaps that many more independent contractors, or free agents, as Dan Pink calls them in his book, Free Agent Nation.
Perhaps as recent as 10 years ago if you told someone you worked from home, whether as a teleworker, home-based business owner, or independent contractor, you would probably have been considered an oddity at best. Today, our culture accepts that concept of work as not only okay, but actually, pretty cool.
Our culture has made a major shift in its attitude toward how we work. Entrepreneurial organizations will be the ones that are prepared to incorporate multiple work venues into their daily operations.
Ten years ago less than 20% of Americans were invested in the stock market. Today, that number is closer to 50%. Millions of American employees are reading the annual reports of the companies in which they are shareholders. Consequently, these employee/investors are more likely to understand how an organization works from management's perspective.
Every employee who has access to that perspective is a potential entrepreneurial employee looking for a home in an entrepreneurial organization. They seek a place where they can deliver value in their work in return for an opportunity to take initiative and be creative. Of course, they want equity. But today they can get that in the equity markets without having to start their own business. If we don't provide them with an entrepreneurial home they will look elsewhere.
The people who report to us are the pioneers of this new entrepreneurial frontier. Guess who their wagon masters are? That's right - you and me.
Here are five things we must be able to do if we all expect to arrive at our intended destination with our assets intact.
1. Be prepared to create and lead an entrepreneurial organization.
2. Help our entrepreneurs acquire the skills and resources they need to be productive entrepreneurial employees.
3. Encourage them to be entrepreneurs, which includes fostering initiative.
4. Accept that in an entrepreneurial organization, mistakes arising from initiative actually become investments.
5. Encourage your entrepreneurial employees to become wagon masters. People love the entrepreneurial feeling so much that they want to share it with others. You must give them that opportunity, or someone else will.
Don't Shake Your Head
A man was standing in front of one of the great masterpieces at the Louvre in Paris. As he looked upon the work of art, he shook his head. One of the curators approached and asked if there was a problem. To which the visitor responded that he just didn't think the painting was all that special.
Whereupon, the curator told the visitor, "Sir, it is not the painting that is being judged here today, but rather those who view it.
Write this on a rock... We can't stand back and shake our heads at what's happening in The Century of the Entrepreneur. It's here, and it's gaining momentum. The question is will you and I be able to create entrepreneurial organizations for all these entrepreneurial employees? And if not, how will we be able to compete with those who do?