Entrepreneurial Cultures Create Engines Of Growth In Organizations
Organizations that can achieve a culture that is truly entrepreneurial provide themselves with a strong competitive advantage
Organizations are looking at ways to become more competitive and grow faster. Some organizations are achieving this by developing a culture of entrepreneurship within the organization. The term ‘entrepreneurial’, in this context, is more than its dictionary definition. It does not only apply to someone who is out to start their own business to make money. A person or team is entrepreneurial if they have the skills and the mindset to drive innovation, problem-solving, creativity and intelligent risk-taking. Entrepreneurial organizations empower such individuals and teams for independent decision-making.
Organizations that can achieve a culture that is truly entrepreneurial provide themselves with a strong competitive advantage. An entrepreneurial culture amplifies both organic and inorganic growth.
Organic growth: creating growth engines
Entrepreneurs are client-centric. They focus on providing the best experiences for their customers. They take direct ownership of client-satisfaction. They can take calculated risks and, if needed, deprioritize short-term profit against long-term client satisfaction and retention. This allows them to move fast and react to their clients' needs resulting in happier clients. This increases the trust that clients place in the organization. Such clients grow their business with the organization and become excellent references for new clients.
Entrepreneurs collaborate well. An organizational culture that empowers entrepreneurs also reduces bureaucracy, traditional KPIs, and strict hierarchical structures. This allows entrepreneurial individuals and groups within the organization to come together seamlessly and speedily to solve client problems or launch new initiatives. They do not have to worry about who owns which cost, or if they need approvals to work with another team.
Entrepreneurs make things happen. They don't just give innovative ideas, but they also own and execute them. They identify opportunities to make the business run better and more efficiently. They identify new initiatives and start new lines of business for the organization. They do this because they work with an ownership mindset. No one tells them to do this. This way, organizations can run several strategic initiatives simultaneously and speedily without having the need for slow centralized and hierarchical decision-making.
Inorganic growth: Creating a familiar environment for incoming entrepreneurs
When a company makes an acquisition, along with the business, they also acquire the entrepreneurs that helped get it to a place where it was worth acquiring. In traditional companies, these entrepreneurs do not always find the space to continue exercising their entrepreneurial instinct; often ending up in nameless hierarchies and biding time before they can exit and move on to their next enterprising venture.
An organization that has an entrepreneurial culture naturally creates room for incoming entrepreneurs to thrive and retains their experience and intellect. It refreshes and reenergizes the incoming entrepreneurs who suddenly find a lot of like-minded people in their corner ready to support them. An organization that has an entrepreneurial culture amplifies the entrepreneurial potential of the entrepreneurs it acquires, instead of losing them.
Entrepreneurial culture: It must be universal within the organization
The mindset of being enterprising and thinking like an owner needs to be culturally driven and should permeate at all levels of the organization. Whether it is the individual, a team, a business unit, a central function—it isn't just the senior management that needs to be entrepreneurial. Everyone should have the empowerment for their context and should carry this mindset. For instance, we talk about agile teams a lot in the tech industry. Agile teams can only work well if they are self-organizing. These teams need to be empowered to take independent decisions. Agile teams require an entrepreneurial mindset to be effective.
An organization's culture should heavily influence the organization's design. Business KPIs, team structures, compliance systems, tooling, communication, information access and all other aspects of how an organization works should support the culture the organization wants to adopt. This applies to the entrepreneurial aspect of culture too.
An entrepreneurial culture is no longer optionalOrganizations that can achieve a culture that is truly entrepreneurial will provide themselves with a strong competitive advantage. The rate of change in any industry, driven by digital innovations, is increasing. To keep pace with this change organizations must transform themselves to be more agile and entrepreneurial.