Psychics predict the future. Entrepreneurs make their own future.
At least that's what a recent study from the University of Washington in Seattle suggests. Instead of trying to predict how markets will behave, entrepreneurs launch companies with little regard for market predictions and focus instead on the issues they can control.
Saras D. Sarasvathy, an assistant entrepreneurship professor at the University of Washington Business School, conducted the study of 27 entrepreneurs, whose companies grossed between $200 million and $6.7 billion annually. While companies varied in type and industry, Sarasvathy found that overall, entrepreneurs eschew predictions, preferring instead to create their own market possibilities by making good decisions in the areas they can control.
Says Sarasvathy, "To the extent that you can control the future, you don't need to predict it." The challenge, of course, always comes in controlling the future. "The interesting thing to realize is that the future is the result of a lot of decisions we make," says Sarasvathy. "The decisions people make are what create the future."
What does this mean for entrepreneurship training-especially in MBA programs, which focus largely on predicting market forces? Sarasvathy says professors like herself should emphasize the development of proactive decision-making and failure management, rather than failure avoidance: "[In this way], you start controlling and creating markets, controlling and creating firms, controlling and creating economic possibilities."