Entrepreneurship Part 2

Let's look at this in a little bit more detail. The one thing I can tell you is there is no universally accepted definition of what we mean by 'the entrepreneur.' Now, many of you were when you were growing up would have read Winnie the Pooh, and you may have be familiar with the term the Hefalump. Now, I wasn't able to find online a picture of the Hefalump, so I've put a curious alien type figure here. But there was a very famous article written about entrepreneurship and defining the entrepreneur called 'In Search for the Hefalump.' And what that article stated was let's forget trying to define who the entrepreneur is. Let's stop trying to pinpoint down one definition. Instead of that we know that there are common characteristics associated with entrepreneurs. They're risk takers, they're innovators, they're creative, they're open-minded, they're also single minded, they're driven, they're very motivated, and well, they can be quite autonomous. But they also enjoy working with people and working in teams. Now, within the literature around how you define an entrepreneur there are some common themes. One is are entrepreneurs made or born? There's no answer to that. But let me move onto the second one; can you teach entrepreneurs? Let me deal with both of those together and give you another example. Are great footballers, are great basketball players, are great tennis players made or born? Can you teach people to become great footballers, basketball players and tennis players? Now, the answer to both of those is yes and no. Sure, you can teach and coach individuals to become great sports people. You can also provide learning opportunities to help you guys, to help me, to help colleagues learn more about what it means to be entrepreneurial and how to engage in entrepreneurial behaviours. So it's unlikely that entrepreneurs are always going to be born, and it's much more likely that the environment that they live in, the way in which they socialise, the way in which they grow up helps individuals become more entrepreneurial. The third point I want to mention here relates to innovation. Because I think Schumpeter's view of creative destruction suggests that entrepreneurs always have to radically innovate. And sure, some entrepreneurs will be involved in radical innovation, you only have to think of the entrepreneurs behind Apple, behind Google, behind Facebook, to realise that these individuals have engaged in radical innovation. But there are a whole host of other entrepreneurs engaged in creative, innovative processes which are not radical. Think about ***, think about Richard Branson for example. Many of the industries within which the *** brand is extended into are actually very conservative, very traditional industries; airlines, alcohol beverages, Coca Cola, weddings, make-up. All the *** brand has done is go into these markets and try to look at them in a different way, and to offer products in a slightly different way. So I think we must be careful in thinking that entrepreneurs are always engaged in radical innovation. Sometimes entrepreneurs will spot an opportunity or a business idea that's happening elsewhere, and bring that to the local market. And what they're actually doing there is imitating something, rather than innovating. Both are equally credible within the process of entrepreneurship. So just to recap then. Rather than perhaps defining the entrepreneur, maybe what's more beneficial for us is to think about entrepreneurial characteristics. If you're going to engage in entrepreneurial behaviour what does that mean? Well, I've listed some key characteristics here. We often think of entrepreneurs as being opportunity recognisers. Entrepreneurs seem to be able to read the market be close to the market, and identify opportunities in the market before most other people can. They can see how markets are changing. As I've mentioned, entrepreneurs do tend to be creative in their thinking, think outside the box, have blue sky thinking, engage in lateral thinking. Now, that's not something that's specific to entrepreneurs, but it is something that entrepreneurs tend to engage in. We've spoken so far about entrepreneurs as risk takers. Now, I think again we need to qualify that, it's probably much more accurate to suggest that entrepreneurs take calculated risks. So they're very, very good at weighing things up, taking balanced risks, risks which may require their financial and personal investment, but risks that they believe have got a really good chance of having an impact, having an effect. Something that you might not always think about, but sometimes entrepreneurs are regarded as engaging in deviant behaviour. Now, what do we mean by that? To say deviant behaviour is possibly a bit unkind. But what mean here is they will engage in more risky, creative behaviour, which is not regarded as the normal way of approaching a particular business, a particular industry sector. And because of that often human nature makes us think such behaviour is deviant. There's been a lot of work done around the motivations and the drive; what drives entrepreneurs? And McClelland's work, again, dates back to the 1960s. But his work suggests that entrepreneurs tend to have a greater need for achievement, success, internal locus of control, and autonomy. What does that mean? They prefer to run businesses or to spin-out businesses, or to manage projects rather than being managed by others. So you can see here I'm not restricting this type of behaviour only to running a business, but actually to all aspects of society. And of course entrepreneurs are often associated with being an inventor, being an innovator, and as we've just discussed also perhaps imitating really good ideas from other markets, and bringing them back to where the entrepreneur is located. Now, I've put up a list for you here of contemporary entrepreneurs. I'm not going to talk through this list at all, but I just thought at this stage in the presentation it might be useful for you to pause to have a look at some of these names here, and perhaps you might want to go and do an internet search on them, and you can find out a little bit more about these contemporary entrepreneurs. And you will find that these entrepreneurs are engaged in all types of businesses, in all types of industry sectors. And they engage in entrepreneurial behaviour not only to make money for themselves, but also to have a broader impact on society. So I suggest that we stop defining the entrepreneur, and instead we recognise these factors; entrepreneurs are diverse. They have diverse background, diverse experiences, diverse management styles and diverse motivations. They can be young, they can be old. They can be men, they can be women. They may have been at university, they may not have been at university, they come from many different cultural backgrounds. So entrepreneurs are diverse, therefore it's impossible to define the entrepreneur. And of course the big challenge or the big myth for us to break is the fact that entrepreneurs sometimes work individually, but often they work in teams, and they work in teams when they're setting up a new venture, they work in teams within or organisations when they're setting up a new project. So I think this team component of entrepreneurship has often been forgotten. So the second part of this presentation or what I want to move onto before we conclude, is this newsflash, let's call it a newsflash. Entrepreneurs and entrepreneurship can occur within diverse contexts. Neither entrepreneurs or the process of entrepreneurship are restricted to the creation of small and new enterprises. So I would like to encourage you to think about entrepreneurs and think about entrepreneurship as diverse and actually broader than perhaps some of your preconceptions might be. So what I'm going to finish with are the different environments, let's call them contexts, within which we find entrepreneurship happening in today's society. The first of these is social entrepreneurship. So this is when an individual or a group of individuals engage in entrepreneurial behaviour, they take risks, they engage in innovative thinking, they approach often really complicated social problems such as housing, healthcare, maybe the need for healthy eating, but they approach these problems in different ways. And what we can say about these individuals is they engage in entrepreneurial behaviour for social rather than personal financial benefits. Now, some examples that you will be familiar with here, I'm sure many of you will buy the Big Issue. So the Big Issue was established by John Bird. So we can suggest that John is a social entrepreneur. The Grameen Bank, many of you will have heard of the Grameen Bank, and of course this was the brainchild, the brainwave of Professor Muhammad Yunus. Who again, would be described probably as globally one of the world's most influential social entrepreneurs. Related to this we also have witnessed particularly in the UK recent significant growth in social enterprises. It seems that when we talk about entrepreneurs and entrepreneurship, people are more excited about the possibility of engaging in entrepreneurial behaviour for social, rather than personal financial reasons. Here's another context within which we find entrepreneurship, and that is the corporate context. Now, historically this context has been referred to as intrapreneurship. But that term isn't really used that often nowadays. So what do we mean by corporate entrepreneurship? This is when entrepreneurial behaviour takes place within an organisation. Now that might be here, an organisation like Strathclyde Business School, Strathclyde University. It might be a large organisation like Google or Pixar. It might be a large organisation like Marks and Spencers, Sainsbury's or Tesco. Most of the large organisations I've mentioned are really keen, despite the fact that they're large organisations with hierarchical structures, with lots of systems and processes, despite all of that they still want to be entrepreneurial. And that's because the more entrepreneurial an organisation is we know, research proves, the more competitive that organisation can be So where large organisations are able to embrace entrepreneurship and to have what we might call an entrepreneurial orientation, this can really help them keep their leading edge. Having said that, that is difficult. We must remember it's difficult within larger and older organisations because of their established hierarchies, structures and systems that they have in place. And that's why looking towards organisations like Pixar and Google can be really interesting if we want to explore in greater detail entrepreneurship within that larger corporate context. Here's something else that's emerging in the literature just now; ecopreneurship. Now, this is similar to social entrepreneurship, and this type of entrepreneurship involves individuals, groups, teams and organisations engaging in entrepreneurial behaviour for environmental gains rather than personal gains. So we might think about recycling schemes that are linked to social enterprises and social entrepreneurs. Now, some of these exist within the UK, but if you want to find out more I recommend Googling recycling schemes in Egypt and you will find one of the world's largest social enterprises linked to eco entrepreneurship, and you may find that quite interesting. Here's another one, a funny word here; mumpreneurship. Now, what do we mean by this? What we mean here are parents, now, we're talking about mums but it may also be dads, but the phrase being used is mumpreneurship. Parents typically who've been working, they take time out of work to have their children, and when they do that they spot some opportunity. And they think actually I want to combine parenthood with running a business. Now, this is a growing phenomenon, and probably a great example for you guys to look at is Mumsnet, and you can Google that, you can go onto the website and find out more. One thing I would say this type of entrepreneurship is often mistakenly regarded as a lifestyle choice. Oh, I'll combine running a business whilst bringing up a family. Research actually suggests that that is really difficult to do, because children 24/7 can be very demanding. And therefore when you are running a business and bringing up families, that in itself will present different types of challenges. To finish with then, let's talk a few moments about the importance of entrepreneurship in contemporary society. There is a mountain of research that you can draw upon that demonstrates that entrepreneurial firms are important economically and socially. Economically they create jobs, so they contribute to job generation. they take risks, they innovate, so they move markets forward, they engage in creative destruction, they shake up markets, they create new opportunities, and by doing so they contribute to economic growth. What we know is where an economy has strong economic growth it is then in a better position to also provide wider societal benefits. So there's a strong link between entrepreneurship economic growth and social benefits. As a behaviour entrepreneurship is something that you and I can engage in. Entrepreneurship is a behaviour that reflects creativity, flexibility, the ability to engage with the environment, to learn from the environment. And if we think about entrepreneurship in these ways we begin to identify that entrepreneurship is a behaviour that we can use ourselves in teams, with others in lots of different contexts. So this something that could be very important to yourselves as you make your way through your career and learn more about being entrepreneurial in the 21st century. I hope you've enjoyed this short talk, we've covered a lot and I'll say goodbye now, thank you.