CHAPTER SUMMARY
Entrepreneurial Principles for a Digital World
All companies start with Entrepreneurship but with time and scale companies forget their roots and look to other management practices. Large companies have grown through their quest for scale, power and wealth. This meant more capital, more workers, more systems, which were well suited for a time in the past – they were in a chase for physical assets. Then came the digital world with Microsoft, which started as packaged software company – there was no internet in 1975.
A year later Apple was founded. Then Yahoo, Netscape, Amazon, and Google happened. Then Facebook, Uber, and Airbnb. . . the digital world erupted and the rules of the game changed. Old rules were not suited for a Volatile, Uncertain, Complex and Ambiguous (VUCA) world. Anyway, the new companies didn’t care about the rules of management.
These upstarts led by entrepreneurs without formal education were taking out the incumbents. As a result of this corporations dived into entrepreneurship and we saw several initiatives; corporate entrepreneurship, intrapreneurship, etc. Great initiatives for new product or service offering, but useless at reforming management practices. Entrepreneurship was “hijacked” by start-ups and companies only allowed it in through very limited initiatives.
Today companies spend millions on leadership development, yet these leaders struggle to effect change. Why? There is one fatal flaw in the process – individual leaders rarely have the authority to make necessary changes even within the departments they lead, much less make the organization-wide changes required.
What if entrepreneurship can be a management practice? That is what we are proposing and urging companies to adopt these practices before they go out of business. How? Well if you don’t build entrepreneurship into your company you become bureaucratic, slow in reacting to competition, risk poor consumer sentiment and your margins will shrink. To top it all, you will struggle to attract top talent because they now have the working at a start-up and compete with your company!
Changes are necessary and this book argues why the way companies are run needs to change. We identify nine specific characteristics that successful entrepreneurs possess; Self-efficacy, Risk-Taking, Passion, Innovation, Opportunism, Learning, Realism, Persuasiveness, and Execution.
People, the central pivot of any business, need to exhibit these behaviors so that an entrepreneurial culture is embedded in the organization. Remember; “Entrepreneurs are not different people, they just do things differently” and therefore it is something that can be learned.
“It’s pretty simple. Very few corporations are entrepreneurial. Most are not and that’s why they are struggling.” – Werner Sutanto [Former MD, Intel, WiMAX SEA]
Entrepreneurship - A Management Practice
Message for the week from author, entrepreneur, and management consultant, Anwar Jumabhoy.
He spoke at PDC2017@Yangon.
What if entrepreneurship can be a management practice?
That is what I am proposing. I am urging companies to adopt these practices before they go out of business. Why? Because if you don’t build entrepreneurship into your company you become bureaucratic, slow in reacting to competition, risk poor consumer sentiments and margins will shrink.
Entrepreneurship is present at the start of a business but with time and scale companies forget their entrepreneurial roots and look to other management practices. Large companies have grown through their quest for scale, power and wealth. This meant more capital, more workers, more systems, which were well suited for a time in the past – they were in a chase for physical assets.
Then came the digital world with Microsoft, which started as packaged software company – there was no Internet in 1975. A year later Apple was founded. Then Yahoo, Netscape, Amazon and Google happened. Then Facebook, Uber and Airbnb. . . the digital world erupted and the rules of the game changed. Old rules were not suited for a Volatile, Uncertain, Complex and Ambiguous (VUCA) world. Anyway, the new companies didn’t care about the rules of management.
These upstarts, led by entrepreneurs without formal education, were taking out the incumbents. As a result, corporations dived into entrepreneurship through several initiatives such as corporate entrepreneurship and intrapreneurship. Great initiatives for new product or service offering, but useless at reforming management practices. Entrepreneurship was “hijacked” by start-ups and companies only allowed it in through very limited initiatives.
Changes are necessary. In my book, 9Entrepreneurisms: Management Practice for a VUCA World, co-authored with Sri Vadrevu, and launched this year, we argued why the way companies operate or manage needs to change. We identified nine specific characteristics that successful entrepreneurs possess - Self-efficacy, Risk-Taking, Passion, Innovation, Opportunism, Learning, Realism, Persuasiveness and Execution.
People, the central pivot of any business, need to exhibit these behaviours so that an entrepreneurial culture is embedded in the organization. Remember, “Entrepreneurs are not different people, they just do things differently” and therefore it is something that can be learned.
Over the next weeks, I will share a synopsis of each chapter. Look out for next week’s installment!