It is an error to consider entrepreneurship as a realm to be left to the start-up of new business entities. It certainly is that. And, as Pinchot recognized a couple of decades ago in his book, Intrapreneuring, the quality of entrepreneurship is important inside existing businesses. 3-M is well known for keeping the entrepreneurial spirit alive in new product development through internal practices of boundary crossing and celebrating the stories of the creators of post-its and other products.
Whatever we label it, the need to support and value innovation in all aspects of business has never been greater in this world of rapid change and complexity. That is one of the reasons that there is a developmental challenge for business leaders to expand their capacity to effectively innovate in a team approach (LeadershipOpportunity, September 2001). Equally important is their capacity to be entrepreneurial in their relationships with stakeholders. And this capacity is built on the foundation of effective executive teamwork.
In the October issue of this e-journal I wrote of the necessity to lead a vital enterprise, a Janus-like role of leadership. Looking inward it is about aligning approaches among leaders to stakeholders (employees, customers, etc.) as they engage with each other in relating to stakeholders in order to achieve business objectives and, ultimately realize business strategies. Looking outward it is about the actual interfaces with stakeholders.
In reality, each leader interfaces with a subset of the stakeholder community. More than one may engage with a particular customer, e.g., COO and VP of marketing. And, certainly, all deal with one or more subsets of employees. But it is likely that each leader, each member of the leadership system, will have their own constellation of stakeholder relationships somewhat distinct from the collective leadership. How effectively they can engage in entrepreneurial initiatives is dependent on all of the factors so far presented in s series.
In the face of rapid change relationships with stakeholders must continually be monitored for information and influence, as well as change related transactions. Some examples might include:
- Relationships with talented employees in order to sustain the innovative capacity of the business and/or to fill the leadership pipeline.
- Relationships with particular customers or market segments to build and sustain competitive advantage.
- Relationships with suppliers to assure quality and timely delivery of products.
Since all of these stakeholders will be impacted by changes in and around their communities of interest, ongoing challenges to the status quo will arise in the relationships between leaders and these stakeholders. This requires leaders to engage with that change. This requires leaders to bring their capacities for innovation within the leadership team into the relationship with stakeholders as part of a vital enterprise.
As entrepreneurs, each leader will have the capacity to innovate and be creative in relation to stakeholders. Where that requires coordination and collaboration with other leaders, that is what building a vital enterprise is about. Individually, leaders will bring this spirit to their unique constellation of stakeholder relationships. Some examples would be
- With customers it means listening as well as creating a field that attracts them. This could be in the form of new products and services that customers need and have not anticipated. It could also mean entering into collaborative relationships for meeting customer needs.
- With suppliers entrepreneurial efforts could forge new strategic alliances, developing supplier capacity to meet the enterprise’s needs, or sharing R&D. The processes and methods of development, production and delivery could be jointly developed.
- With employees, the leader-entrepreneur can engage individually in mentoring and filling the leadership pipeline, with devising means for information to flow across organization boundaries and providing those with unique information the opportunity to influence the decision making process.
Note the quote at the beginning of this e-journal. If a leader is going to be open to that candid dialogue with employees (and with other stakeholders), then an entrepreneurial spirit will be necessary. The leader will need to think about how to find creative mutual actions to meet the mutual challenges of doing business in a rapidly changing world.
Entrepreneurship is a critical role for leaders in business today. It supports the innovation, change and even transformation that are required for all of the variables necessary to converge to make the business successful.
In the next issue I will be looking at the relationship between espoused theory and theory of action, a relationship that is at the heart of integrity and leader success.
> Russ Volckmann