The Entrepreneurial Renaissance

Jim Blasingame Prior to the 14th century, humans civilization had accomplished very little in the way of secular progress: Fire, the wheel, some scientific discoveries, limited medical advancements.

We had the written word, which Adam Smith identified as one of the three greatest human developments. But all documentation was by hand, thus minimizing the opportunity for mass distribution (a cause lacking constituency, since most people were illiterate). International communication and commerce were limited, slow, and rudimentary - lots of ignorance perpetuating centuries of minimal intellectual enlightenment. Neither life, nor the marketplace, had made much of a quantum leap from where it had been, say, when the Julian Calendar was proposed by Julius Caesar, just before the birth of Christ.

The Plague
Why use the 14th century as a point of demarcation? Well, there was a pandemic phenomenon which occurred that century between 1347-1350. In case you slept through European history, that was the period of time when 30-50% of the population of the British Isles and Western Europe was decimated by Bubonic plague. They called it "the pestilence." (It wasn't called "Black Death" until the 18th Century.) In numbers, the estimate is 20 million dead in those three years.

Don't worry, I'm not going to dwell on this unfortunate period. My interest lies in the fact that such a holocaust could actually be considered a blessing. In his book, In The Wake Of the Plague, The Black Death and The World It Made, Norman F. Cantor writes that the devastation also caused the literal demise of the old, unenlightened order, and made way for the new enlightened order. Cantor argues that "The Black Death heralded an intellectual revolution." He is talking about The Reformation, The Renaissance era, and The Age of Enlightenment.

The Blessings
Consider just a few developments of the 200 years immediately following The Plague:

Information - Gutenberg (1400-68) used his movable type to make mass printing possible. Books and bibles finally could be available to the masses. Now for the first time in human history, there was a reason for ordinary people to learn to read.

Religion - Martin Luther (1483-1546) began the Protestant Reformation, which helped loosen the grip of the old church dogma on the state and the people. Just in time for the new Gutenberg bibles.Art - Michelangelo (1475-1564) created Renaissance art that is still valid, imitated, and valued 500 years later. Enlightened minds are inspired by beautiful things.Science and Engineering - Leonardo da Vinci (1452-1519) actually made significant contributions to art, thought, AND science and engineering. He was perhaps THE Renaissance man. Civilization still benefits from the leveraging of his work and his thoughts.

One Plague Fits All
One thing about a plague is that it is no respecter of persons. And since the nobility and clerics lived very close to the peasantry, their losses were proportionally similar to that of serfdom. Without the "pestilence", would a full cadre of the old order have allowed these minds to flourish? Cantor argues that they would not.

Furthermore, Cantor points out, with the decimation of those who did the work in the 90% agrarian economy, those who were left would not have been able to demand, and get, more freedom, ownership, and higher wages. All of which must have contributed significantly to the birth of what we today call entrepreneurialism: Independent thinking, risk taking that rewards the risk taker, and creativity for it's own sake.

Sometimes it takes a drastic event to create drastic improvements.

Back To The Future
I know you're ready, so let's fast-forward to the 20th century. As the 1900s progressed, it became more and more the century of the big corporation. The natural by-product of which was the marginalization of small businesses. Not that small business had ever been a major blip on anyone's radar screen, but now, there was more contrast to be drawn between us and our big neighbors. Those of us who weren't going to grow into Ford Motor Company, McDonald's, or Kellogg's, were disregarded as family owned shops, farms, and backwater foundries and factories.

In professional terms, employees of these small establishments were not viewed with the same credibility as someone who worked for any of the big companies. I know, because I worked for Sears and Xerox during their heydays, and the nod-of-acceptance I got when I answered the obligatory "where do you work" question was much more vigorous than the one I got later, when I said I was a small business owner. The response to the latter answer was more "Oh! Well! Isn't that nice?" Read: "You poor thing. Couldn't get a real job."

The Beginning Of The End
All of that started to change in the mid-1970s. I believe the events of that decade contributed significantly to the end of major corporations being seen as the answer to personal, professional, and national economic salvation. Events? Don't worry, you didn't miss a plague - at least not a biomedical one. But there was a shift.

Reductions in military spending for the Viet Nam war caused the 1969 recession. We were barely over that recession when the official end of the war, coupled with the energy crisis, created the deeper recession of the mid-1970s. Nixon's price controls and the malaise years of the Carter administration connected us to the recession of 1981-82.

Concurrently during this period, there was the second Japanese attack of the 20th Century. I call it the Japanese 3-C invasion: Cars, copiers, and cycles (motor). This offensive forever changed one very large American industry, one medium-sized one, and one small one.

The New Plague
The 1970s were not good economic years as America struggled with double-digit inflation. Plus all of these political and competitive forces combined with bad economic policy (double-digit prime interest rate), to create a pretty tough profit environment for everyone, but especially for big business. The big, publicly traded companies are largely funded with the equity capital of shareholders, who demand profits, growth, or both. So, in the 1970s, when the corporate Solomons were deciding which of their babies to cut in half, profits or personnel, who do you think got the sword - I mean, axe? That's right, the one with the heartbeat.

Long term, employees create profits. Short term, they create payroll expense. Thus began the professional equivalent of the pestilence for millions of loyal employees - downsizing - as short-term memory, the classic symptom of dividend dementia, gripped boardroom behavior all across the land.

But - unlike Black Death in the 14th century, which was gone in three years - downsizing has become systemic in corporate America. Here's a familiar headline that is seen on a regular basis, and is now appearing in its 4th decade:

The Wall Street Journal
Dateline: New York
AMALGAMATED PABLUM REPORTS PROFITS DOWN
One fourth of the workforce, 8,000 employees, will be cut this quarter to improve the bottom line.

Sometimes it takes a drastic event to create drastic improvements.

The New Order
So, if Cantor can find a blessing in a pandemic biomedical holocaust, can Blasingame find a blessing in systemic corporate downsizing? ABSOLUTELY. I call it, The Entrepreneurial Renaissance.

Without downsizing The Entrepreneurial Renaissance might have happened, but when? In the 1956 classic, Organization Man, William Whyte, Jr. identified what most Americans had become in the 20th century: a person who ignored or buried his own identity and goals in the service of a large organization.

In the last quarter of the 20th century, the downsized Organization Man - and Organization Woman - decided to forsake the resume for a business plan, and hitched their wagons to their own star. Many became what my friend, Dan Pink calls, Free Agents. In his book, Free Agent Nation, Dan estimates there are about 30 million free agents in America. The antithesis of Organization Man, Dan says Free Agents are "untethered to a large organization," and operate as micro-business or independent contractors.

Millions Of Renaissance Men AND Women
Then there are those of us who look more like a traditional small business, with storefronts, neon signs, employees, inventory, and rolling stock. The U.S. government estimates that perhaps 25 million more Americans are small business owners, from the tiny companies who have at least some employees, to the larger species of our genus, with 100 or more employees. Sure, there is some overlapping in these categories. But where once there were tens of millions of Organization Men, there are now tens of millions of Free Agents, small business owners, and home-based business owners.

Nothing that happened in the last 25 or so years compares in any way to the devastation that arose from the Black Death. But I think one could argue that, in terms of shaping the future of civilization, one hundred years from now, the downsizing pandemic of 1975-2000 is going to be seen as the pivotal pestilence that put an end to Organization Man mentality, and gave rise to the Entrepreneurial Renaissance. And I don't think I have to list for you the accomplishments entrepreneurs have made since our latter-day pestilence began.

The Age Of The Entrepreneur
I have said it before: The 21st Century is going to be the age of the entrepreneur. Entrepreneurial soil is becoming more and more fertile every year. The approving head-nodding response that I used to get when I was Organization Man has returned, but now it's a reaction to my answer that I live by my wits as a small business owner. "Wow. That's great." Read: "Very cool. This guy is plugged into the future."

The future? The Entrepreneurial Renaissance is, and will continue to be, exciting. Perhaps, on day, someone will write a book about The Wake Of the Downsizing Pestilence, And The World It Made. Perhaps Dan Pink already has.

Write this on a rock... Blessings come in many forms. Sometimes, at first, they look like pestilence.

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Category: Entrepreneurship
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