Rethinking the way we think about Entrepreneurship
Gideon Maas, the Director of our International Centre for International Entrepreneurship shares his views on business in the 21st century in our latest piece for BusinessInsider.com.
Our global economy is changing. Some say, not without substance, that it’s actually in crisis. Certainly there is growing inequality and real problems around social mobility across the world. In such challenging circumstances, entrepreneurs as innovators, risk takers and – to use a term favoured by politicians – wealth creators are championed as the potential catalyst for socio-economic growth.
When we reflect on how many countries are struggling to maintain sustainable growth we need to ask whether they possess the right entrepreneurial capabilitie s. Do they have the supportive eco-systems and policies in place to transform themselves from struggling to thriving socio-economic landscapes? If not why?
More pertinently are we addressing current and future challenges and opportunities from an outdated set of skills and policies? We might want to question whether governments and other support institutions are focussing on the “right” type of entrepreneurship. That is, if the emphasis is on small scale start-ups (micro-businesses) and not scale-ups then it is questionable whether sustainable socio-economic development can be maintained.
In terms of a micro-orientation where the business is created by one person and stays that size, then its impact – the knock-on effect or wealth creation through associated supply chains and so on – is likely to be minimal. But of course many of these entrepreneurs emerge from a ‘needs must’ mindset and I’m not arguing against the existence of locally focused entrepreneurial activities. Far from it, they are important for cascading wealth to the broader society. But if not enough focus is put on entrepreneurial activities that go beyond local levels large-scale, truly transformative socio-economic growth is unlikely.
What I’m talking about here is not just needs must thinking but thinking around the creation of new needs. Picture two very different entrepreneurial happenings – the opening of a food stall and the emergence of Silicon Valley. Both are in essence transformative events; it’s just a matter of scale. And there is of course room for both. So a balance needs to be struck between a focus on individual entrepreneurial activities and society-wide changes, which may have a more positive impact on socio-economic growth.
In the current environment it often seems that short-termism and immediacy takes precedence but that’s a risky philosophy. Financial issues were always regarded as a measuring instrument for entrepreneurial activities and not as the ultimate goal but if the focus is solely on financial gains then that feeds greed, which is not helping to address a skewness of wealth distribution.
What’s required is a more progressive system that will allow entrepreneurs to scale-up through the productive exploitation of opportunities, which are supported by policies that allow them to take calculated risks and which will not overly punish them for making mistakes. The current dominant focus on cost-efficiency needs to be replaced by sustainable opportunity exploitation.
One can read through the above and easily get to the view that this is a macro approach and nothing to do with the individual entrepreneur. But that’s not the case. Entrepreneurs should gain knowledge of the total industry in which they operate in a continuous manner. They need to think beyond their own individual systems and form sound networks with other role-players around the world.
The validity of accepted solutions for given problems should be tested continuously and adapted to meet the requirements of the current and future environments. Leadership and entrepreneurship need to combine to stimulate innovative thinking allowing the exploitation of new opportunities on a continuous basis.
These are all things that Coventry University is exploring through its International Centre for Transformational Entrepreneurship. Education is itself a transformative tool and through entrepreneurship-based teaching and research activities, our aim is to support communities both here and overseas address issues of poverty, inequality and social mobility. We’ve already established the above model in Africa to help boost socio-economic growth across that continent and we’re in the process of creating a similar set-up in South-East-Asia.