Why can’t we all be entrepreneurs?
I was invited recently to an excellent seminar hosted by a couple of old colleagues and friends, Dave Good and John Rosling, exploring the differences between being an entrepreneur and working in a corporate organisation. I was asked to pull together a few opening thoughts about why it’s difficult for leaders in big companies to think like entrepreneurs.
The starting point for any conversation of this type is to establish what we mean by the term entrepreneur. To play it safe (not very entrepreneurial, I know!) I went to the dictionary where it describes someone who sets up a new business, taking a financial risk in the hope of making a profit.
This may be true, but I would elaborate further. Entrepreneurs I have met have also had an idea they believe in, a vision of something they want to create and see through. They have passion, drive and a determination to make things happen, even when barriers and obstacles spring up in their path.
My own experience in leaving Unilever 15 years ago and setting up Brand Learning with Mhairi McEwan bears testament to this. I wouldn’t describe myself as a big risk taker at heart, but the move certainly seemed like a significant one at the time. Our key motivation was genuinely not financial, but a desire to follow through on the love we’d discovered for building marketing capabilities and to build a company with a culture we could be proud. It wasn’t that we didn’t have a fear of failure – we just thought it a risk worth taking because the promise of what was possible if we succeeded was so exciting.
Looking back at the leaders I’ve met in corporate organisations, there have certainly been some who fit this broader definition of an entrepreneur very well. They may not have owned their companies or invested their own capital, but their passion, commitment and spirit of experimentation has been phenomenal. But the fact is they are not the norm, so what is that holds people back in a corporate environment?
In my view, there are three key issues.
One is the pressure to deliver short-term results. New ideas often take time to come to fruition. The first expression of a business concept is rarely perfect, so patience and money are often required to enable some experimentation. Big ideas also often start small, so they appear less attractive in a big company where rapid, large-scale commercial impact is looked for.
It’s easy to forget, but most entrepreneurs fail a lot more than they succeed, a fact that doesn’t sit well with institutional shareholders looking for stable returns. The challenge for business leaders is to create an environment where people have the space to think big but start and fail small. The full scale of their organisations can then be brought to bear later by rolling out successful emerging ideas fast.
The second obstacle is people. The fact is that as a company grows, the more one has to contend with the challenges of group dynamics and organisational systems. The bigger the business, the more people there are with different points of view, conflicting personalities and divergent objectives. The result is an increasing need for consensus building and cross-functional integration, though this can become just as much of an issue for entrepreneurs as for anyone else once their businesses grow successful and therefore large. The risk is that people brought up in this kind of environment grow used to playing the political game for its own sake, rather than focusing on all they can do to make a real positive difference for their customers and the business itself.
Which brings me to my third and central point. For me, the most important route to entrepreneurialism is enabling people to devote themselves to things they are passionate about – things they love doing and care for. This is where the fuel and inspiration for true innovation comes from. It is also what sparks the determination to overcome the other corporate obstacles I’ve described.
The irony is that many of the empowering factors independent entrepreneurs struggle to obtain – financial resources, commercial expertise, infrastructure – are the very things that corporate organisations have in abundance. The path to generating more entrepreneurial behaviour in organisations therefore has to lie in channeling these resources in ways which encourage people to pursue their passions and champion their ideas internally rather than externally.
Originally posted on the Marketing Society blog.
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