The Difference between Managers and Entrepreneurs
In our daily work with corporate organizations we see that the world those organizations used to know, a world of lifeless numbers and marketing projections, doesn’t create real unique value in today’s modern business.
While the basics of profit and revenue still remain, we know that getting there requires innovation, creativity and an adaptable skillset like never before. We also know that for companies who have been doing the same thing for a long time, that innovation and often necessary change can be difficult.
This article will look at the varying roles of change in business, who leads that change, and what these things mean for the success of your business. Not to mention, how we can help.
Why do we care so much about change?
At mantro, we believe we are enablers of change. We credit this to our work in which we create lighthouses of innovation by bringing new products to life. The driving force behind our work is substantial entrepreneurship, which causes us to think about how to foster entrepreneurship in those organizations. We need entrepreneurial partners!
Change vs. Change Management
To begin, let’s break down the difference between “change” and “change management.”
Say the words “change management” in a company setting and take note of how many people’s eyes read panic, and how many people start immediately sweating. Change management is feared in many of today’s companies.
The root of this fear? The associations that come with change management.
Change management is often viewed as optimizing a company’s processes in order to secure the profitability of the company. Sometimes that means: laying people off, restructuring people to new locations or into new job roles, or reorganizing entire departments into other divisions.
Which, rightfully so, can sound scary.
But how else can the term “change” be viewed in a company?
Ultimately, change comes down to altering the way a company does business. This alteration is not necessarily driven by changing the employment structure of the company itself, but instead allowing room for, even encouraging, adaptability in an ever-changing world. That could mean new ideas, products or methods, just for starters.
Take a look at Apple, who almost went bankrupt in the late 90s. We all know where innovation has taken them in recent years.
On the contrary, think of Toys “R” Us. When is the last time you stepped foot in a Toys “R” Us? If it’s been awhile, chances are that if you were to go right now, if only for the sole purpose of taking a stroll down their aisles, you wouldn’t be very surprised by what you saw.
Not much has changed inside of a Toys “R” Us store and because of that, they are falling behind other toy companies. They are lacking corporate innovation, and paying for it.
The type of innovation Toys “R” Us and so many other companies needs now is not more efficient processes or better management, but a new business model altogether. In other words, they need entrepreneurship.
Manager vs. Entrepreneur
Of course at the backbone of entrepreneurship is the entrepreneur. But what is the difference between a manager and an entrepreneur?
A manager optimizes processes. A manager makes sure that the functionality of the current business system creates profit.
An entrepreneur, besides being harder to spell and cooler to say, takes on a slightly different role.
An entrepreneur doesn’t make sure that the current business structure is carried out optimally, but looks for ways the current business structure might need to change. They observe the markets, their needs and conditions, and think: “what’s the next step?”
A risk-taker and a go-getter, an entrepreneur invests time and resources into processes, which profitability is yet unknown to himself. This is called entrepreneurial risk and is the activity that ultimately embodies added-value. This is not a random process, but requires skilled market observation and subsequent alteration to match the market they hope to be active in.
How to Make the Change
So does a company just wake up one day and decide to be a company of entrepreneurs? When a business recognizes a need to be more innovative and fluid, what does that actually look like?
Here are some things that we have seen work:
Allowing pragmatism before process alignment.
Big companies tend to love their processes and standards. This is not because they are trying to annoy their employees, but because standard processes come with the important advantage of maintaining order and control in a big organization. But the disadvantage of this is lower creativity, bureaucracy costs and speed loss. For innovation purposes, these disadvantages outweigh the advantages of control. That’s why in innovative units we call out for pragmatism in problem solution. Those who embrace pragmatism bear the risk of not knowing exactly how things will turn out, but in the same hand gain innovative and fast solution creation.
Allowing openness for real partnership.
We have seen how big corporations often don’t want to talk about their ideas because they are scared that someone will steal them. Yes, it is true that there is a risk of someone copycatting your idea. But there is also the risk that your idea is terrible but no one ever tells you because no one ever hears about it. Instead, you find out as your idea crashes and burns in the marketplace. This risk of your idea being bad is a lot higher than the risk of someone taking your idea. Form partnerships with people who have expertise in entrepreneurships and your product niche.
Rethinking your recruiting process and people selection.
Great products are going to need a passionate and dedicated team backing them. Recruitment shouldn’t be about checking off little boxes deeming someone as right or wrong for the job. We at mantro look for people with outstanding skills, even if there are certain things missing from their resume you would typically look for.
Failure vs. Success
When an entrepreneur successfully observes a market need and translates it into a business offering that matches that observed market need, then there is a significant probability to develop a value creator.
This achievement makes up the perceived entrepreneurial success stories which are talked about, usually only once they have happened.
Of course these entrepreneurial successes we hear about miss a big part of the story. We hear about new achievements and the seemingly sudden exponential growth. But it should not be misunderstood- before that, there is the pain of uncertainty. There are risks of going into unknown lands. Often times there are many ideas, terrible ideas, that end before they really have even started, before the great idea flourishes. Failure is often a stepping stone to success as an entrepreneur works on polishing the skill of perceiving market needs and offering solutions to those needs.
We often meet potential partners who want the high of achievement but are unaware of the pain of uncertainty they have to go through before, and often during, the road to success. Take this not as a reason to not try, but instead a better understanding to help you on your way. We have felt that uncertainty; we have struggled getting to that right idea. But we have also experienced much success! And we want to help our partners experience it for themselves.
In the end, there is no need to pit managers against entrepreneurs or “pick a side.” Managers aren’t bad, if they’re used in the right evolutionary level of a business. Entrepreneurs are needed to change corporate business models and drive innovation and if those businesses have grown professional and have scaled, managers are needed again!
If your organization is due for a change and ready to add real value to the market, cultivate a willingness to take the entrepreneurial risk. Maintain this through pragmatic approaches, building partnerships and building the right team. And if you need our help with that, we’re ready for you.
This article was originally published by mantro CEO Manfred Tropper on LinkedIn: https://www.linkedin.com/pulse/difference-between-managers-entrepreneurs-manfred-tropper/
