Unleashing the Entrepreneurial Spirit in Your Organization: A Call to Action for Management

The discussion on making entrepreneurs out of employees has been quite pervasive. Yet, one hardly sees this happening. In effect, management has become more like many politicians who say very nice things but do otherwise. That notwithstanding, though, we all know change is difficult. And so adopting this new way of doing things cannot happen overnight. Yet, management/business thinkers/writers as we are, we are positive about this happening some time later, if not soon. Our enthusiasm and optimism will therefore continue to impel us to keep harping on this very need. Thus, I am more than motivated to write once more on this very issue.

To set the tone for our discourse, however, we want to define who an entrepreneur is. This would give us the right footing for the discussion.

Who Is An Entrepreneur?

“The term entrepreneur is a loanword from French, and is commonly used to describe an individual who organizes and operates a business or businesses, taking on financial risk to do so.”—Wikipedia

The key phrases in this definition are 1) organizes and operates a business or businesses; and 2) taking on financial risk.

This implies that there are certain conditions and abilities that make it possible for the entrepreneur to function properly. These include a wide latitude for decision-making, multi-tasking, multi-skill, knowledge and information.

Thus for an organisation to successfully turn their employees into entrepreneurs, those conditions should be created in the company. Then the required abilities would also emerge. Let’s now look at how that can be done.

Conditions/Abilities for Entrepreneurship

Disambiguate the organization. To begin with, it is totally impossible to create entrepreneurs in a large organization. This is because large organizations are typically highly departmentalized with each department specializing in a particular field. In such an environment, one can hardly have all the information they need to build on their knowledge; multi-skill is severely hampered; and decision-making is painfully slow and exclusive. Such conditions and more like them which are rife in large organizations thus never allow for an employee to become an entrepreneur within the organisation.

Hence, the first step to encouraging the entrepreneurial spirit in the organization is disambiguate; break up the organization into smaller units of separate business entities. Doing so would make for the promotion of creativity and innovation. In such an environment, employees get involved in the decision-making process and get to learn various skills that enhance efficiency and effectiveness.

Eliminate hierarchies. Along with the disambiguation of the organisation comes the elimination of hierarchies. Of course, this does not happen automatically though. Hence there should be a conscious effort to create an entity of equals who work in cross-functional teams, with varying roles, rather than on the basis of a boss-subordinate relationship. This makes for an abundance of ideas and a mix of activities that make it possible to multi-task and acquire multi-skills.

Encourage financial responsibility. When the organization is broken into smaller units of separate entities, these have each other as the primary client. Then they also look outside of

the group for other customers/clients. The idea is to make them financially responsible in that they have to work to pay themselves and sustain the business. Since necessity is the mother of invention, when challenges confront them, they would be motivated to look for creative and innovative ways for resolving those challenges, leading to financial security.

In large organizations, there is so much impersonality, and that breeds sloth and ineptitude. And departments that are not directly responsible for sales tend to be lethargic in income generation; and why not?

It takes the combined efforts of everyone in the organization to make production and sales possible. Yet, invariably, it is particular departments and individuals within those departments that get the bonuses when the business is successful. So how would the other departments and individuals go beyond their limits to find creative ways of income generation in the interest of the company?  They would only do so much.

But in a smaller entity where everyone is assured of his fair due if they are exceptionally productive, these would put in their best and that would go to consolidate, not only their personal income, but that of the company as well.

Encourage experimentation. Experimentation can be quite expensive, not only in financial terms, but also in terms of time. This no doubt makes many managers apprehensive about experimentation. Yet, experimentation begets innovation and creativity. It has thus become a necessary evil.

In large organizations, experimentation is usually non-existent. This is because bosses are scared their subordinates could overtake them so they stifle it. Also, because decision making is centralized, one has very little room, if any, to experiment. Besides, receiving approval from management is another bureaucratic endeavour that can be both intimidating and unfruitful. Many have thus resigned themselves to just getting by. And this has over the decades significantly impacted productivity negatively.

To reverse the tendency, when the organization is split up into smaller entities, experimentation can conveniently happen regularly. And even if there’s failure, the impact may not be felt as much as in a large organisaton. At any rate, since mistakes are naturally a way of learning, this would add to the creativeness and innovativeness of employees.

Reward adequately. The success of an employee in his work is a great joy for the whole organization since the company itself benefits. However, the reward for such innovative employees should not end with bonuses. Loyal employees who have dispensed of themselves very well as entrepreneurs should be rewarded by way of shares in the company. Such loyal employees, realizing that what they do will not be in vain would continue to do their best for the company for it to grow and also give birth to other smaller business entities.

No Lip Service

Certainly, encouraging the entrepreneurial spirit in the organization is a very critical factor for success. But it requires a lot of thinking, change and strategizing—work! Essentially. management should not continue to delude itself that such a spirit can be cultivated if things continue to run as they do now. So much has to change. Traditional management principles, processes and practices must be audited to see their relevance or otherwise to modern realities. But this should start with the re-making of the thinking of management. When management eschew fear, abolish hierarchies, disambiguate the organization and grant enough space to employees, that is when the true entrepreneurial spirit can thrive. Otherwise, the status quo would continue to persist, leading to more mediocrity, more sloth and more ineptitude.

The author is CEO/Managing Partner at Soleil Consults (US), LLC, a Strategy, Management and ICT firm.