The speed of change, global economy, and emerging markets mean that organisations have to keep pace or quickly become obsolete. To do this companies need to innovate, so, this month, we focus on how to embed a culture of entrepreneurial thinking into your company. You may also be interested to read my article about innovation, as there is a natural link.
Why you need entrepreneurial thinking in your organisation
Companies that exhibit entrepreneurship are typically viewed as dynamic, flexible entities that are prepared to take advantage of new opportunities as they arise.
Corporate entrepreneurship facilitates a company’s efforts to innovate constantly.
There may be a few situations where you might not want entrepreneurship such as environments that require compliance to legislation. However, even in those situations, there may be a laborious process where there is an opportunity to innovate in a way that saves time, effort or money.
“Embrace what you don’t know, especially in the beginning, because what you don’t know can become your greatest asset. It ensures that you will absolutely be doing things different from everybody else.”
Sara Blakely, SPANX founder
5 dimensions that enable entrepreneurial behaviour
Successful companies such as Apple, 3M, Proctor & Gamble and Google know the importance of having an internal environment that promotes and supports innovative activity.
Recent research* has acknowledged this importance and identified five dimensions that enable entrepreneurial behaviour:
1. Top management support
(Yes, I know that whenever anyone recommends anything, ‘support from top management’ is always the first thing that gets highlighted, and it can make leaders feel as though the weight of the world is on their shoulders!)
Employees will assess the degree of readiness and acceptance there is within the organisation for them to take personal risks, challenge the current ways of doing things, and invest time to explore and experiment. The extent to which they perceive cultural and senior management support for entrepreneurial behaviour will have a big impact on their assessment of whether or not it’s OK to do.
Last year I worked with a leadership team who set an objective about the number of innovative projects they wanted to sign off. To do this they understood they needed to create an environment when it’s OK to fail as well as to succeed. They were able to create a climate where employees felt able to speak up and share their ideas and challenges, which led to some successful projects.
“Behold the turtle, he makes progress only when he sticks his neck out.”
2. Work discretion
The research suggests that entrepreneurial opportunities are best recognised by those who have discretion over how to perform their work, as well as by those who are encouraged to engage in experimentation. So give employees the freedom to think and act without a lot of supervision or micro-management. Do you delegate decisions as low down your organisation as possible?
3. Rewards and reinforcement
Everybody knows that people focus on what gets measured and rewarded, so the extent of entrepreneurial thinking in your organisation will depend on the extent to which you reward and reinforce entrepreneurial activity and success.
“Anything that is measured and watched, improves.”
Bob Parsons, GoDaddy founder
4. Time availability
Allow time in the workload of individuals and groups for them to pursue innovation.
I’ve worked with research teams who allocate 5-10% of their time to blue-sky thinking, where they can work on anything they want that they think will advance the environment they’re in.
5. Organisational boundaries
Within a large organisation, you are most likely to get innovation when resources are channelled rather than everyone going off in different directions in a chaotic way. You should work to enhance the flow of information with the external environment as well as between internal departments, and then assess which ideas to invest in.
It may seem counter-intuitive, but the researchers found that “Innovative outcomes emerge most predictably when innovation is treated as a structured and purposeful (versus chaotic) process.”
*Source: ‘Diagnosing a firm’s internal environment for corporate entrepreneurship’
Kelley School of Business, Indiana University (2013)
9 characteristics of entrepreneurs
I’ve compiled these nine characteristics of entrepreneurs. Tick the boxes to see which you already have and can therefore play to easily, and which you would like to adopt. Think about how you can encourage your team or department to develop more of an entrepreneurial mindset that will enable your organisation to innovate and evolve.
1. Have high energy, be creative – and see it through
My first thought was that entrepreneurs mainly have lots of ideas and energy. My research for this article also reinforces the absolute imperative of executing on your idea – all the successful entrepreneurs say that having an idea is OK, but if you don’t do anything, it stays just an idea. So, it’s the combination of ideas and execution that are key.
This links to my article on managing your energy not your time.
“The value of an idea lies in the using of it.”
Thomas Edison, General Electric Co-founder
“I knew that if I failed I wouldn’t regret that, but I knew the one thing I might regret is not trying.”
Jeff Bezos, Amazon founder and CEO
2. Have tenacity, self-confidence and belief in what you are doing
There are plenty of nay-sayers who will tell you why something can’t be done, or who say ‘yes but’ (which really means ‘no’). You need self-confidence and belief to see your idea through.
“In the midst of every difficulty lies opportunity”
“Don’t be afraid to assert yourself, have confidence in your abilities and don’t let the b*stards get you down.”
Michael Bloomberg, Bloomberg L.P. founder
“Diligence is the mother of good luck.”
3. Be futuristic in your outlook
Some people get sucked into their day-to-day task list, and given how overwhelming the task list is, it’s easy to see why. However, you must also make time to be futuristic – this is probably a key aspect of your role in any case (and not something to delegate). Some of my clients use their exercise time to think, or their daily commute, and they may read books to stimulate their thinking. It’s also a good idea to take time out (offsite) with your team to create and set the future.
4. Learn from failure and adapt
Accept it’s likely that you won’t succeed at your first attempt. All the great entrepreneurs had many failures, with years of hard work, redesigning and adapting until they achieved success.
For example, watch this brief video interview with James Dyson:
“I’ve been involved with companies that hit dead ends, had business ideas I couldn’t get off the ground, been in situations that I desperately wanted to succeed but were on a path to failure. But each set-back and adversity could be traced back to the same flawed plan: I had approached the game the way it had always been played. My ability to overcome adversity has often been tied to a refusal to accept defeat and a willingness to explore other approaches to the game.”
Brad Keywell, co-founder of Groupon and Lightbank
5. Thrive on change and ambiguity
Don’t be afraid to challenge the rules and status quo. As a leader, it’s important to listen, especially to people who have a different approach/personality to you. People who are comfortable with ambiguity tend to be more creative and have a more flexible approach to rules and structure. For more on this, please see my article on dealing with ambiguity.
6. Take personal responsibility
If you are ‘thinking big’ with your ideas, you are unlikely to achieve them on your own, so you need to collaborate, co-create and be a team player. A key success criteria in addition is your personal drive and accountability to get things done and keep things moving when they slow down.
“Courage and humility – just give it a shot and if someone has a better idea, say, thank you, that’s a better idea. For CEOs, that’s the kind of culture you need to create in your organization. For junior staff, you must insist on speaking up when you have a thoughtful idea. You never know – lives may depend on it.”
Jim Kim, president at the World Bank
7. Be independent minded
You need the ability to think for yourself rather than wait for others to give you ideas and direction.
8. Love competition
Entrepreneurs are competitive, but not with their colleagues. They want to win against other companies and create something unique or better in the marketplace – they often think big and with the mindset of leaving a legacy.
“Your work is going to fill a large part of your life, and the only way to be truly satisfied is to do what you believe is great work. And the only way to do great work is to love what you do.”
Steve Jobs, late Apple Inc Co-founder, chairman and CEO
9. Take calculated risks
‘Calculated’ is the important word here. You need to be prepared to take risks, but don’t be foolhardy. Weigh up your ideas and do the numbers. Think what you might gain and what you could potentially lose. Do what you can to minimise and mitigate against risks.
A word from Sir Richard Branson
It’s impossible to discuss entrepreneurship without mentioning one of the most famous entrepreneurs of our age, so here are some ideas from Sir Richard Branson.
“You don’t learn to walk by following rules. You learn by doing and falling over.”
“The truth is, rules are made to be broken. If the theory is sound: trust your instincts, but protect the downside.”
Richard Branson, founder of the Virgin Group
Richard Branson talks to TED’s Chris Anderson
And finally, you may like to read Richard Branson’s top 10 tips for success on the BBC website.
Please share this article with anyone you know who might find it interesting, and let me know if you’d like more information.
Next month we look at models for decision-making.