Betting on entrepreneurs to win in the long run?
Almost every job posting today has words innovation, entrepreneur, and strategy in the description. Even large organizations have caught the entrepreneurial bug and are betting their futures by filling their ranks with entrepreneurs. Unfortunately, hiring managers can’t provide a concrete example of how someone who they consider to be an amazing entrepreneur has been successful in a similar situation. So words like innovative, entrepreneur, and strategic are all muttered under the breath, typically in the same sentence, like words to a song you don’t know.
Here is the problem…as entrepreneurship became an actual and respectable profession, something that college graduates aspired to become, large companies found themselves in a tough spot. First, the pace of change was much slower and large organizations thrive on momentum. Second, they started to lose their most productive talent. Large organizations need brilliance, and hard work, and perseverance against all odds, and charisma to keep their already large and successful companies growing even large and more successful. Executives are smart and realized that they had to learn to better compete with and better recruit individuals whose energy, passion, and will combined with outside capital would regularly produce outsized results. So most extraordinary traits from the most extraordinary individuals in the business world were summarized by the term entrepreneur, the mythical creature which every large companies claims to want to employ.
Entrepreneur is defined by Wikipedia as, “…a person who organizes and operates a business or businesses, taking on greater than normal financial risks in order to do so.” It is obvious that most employees inside the company should not be entrepreneurs. Entrepreneurs start or manage businesses, they have bold and unique vision or execution style, they do not want to work for companies. These are larger than life personalities, these men and women are sages, profits, and sages. Entrepreneurs are capable of sending people to Mars, eliminating poverty, or curing Malaria, but not of going through a corporate 360 degree review process. Imagine what hiring a Steve Jobs, an Elon Musk, or a Mark Zuckerberg to work for you or as your peer would do to your career and your life?
Academics and consultants invented the intrapreneur, the softer, kinder, a more altruistic and collaborative entrepreneur, to provide a description and give credibility to those disruptive (in both good and bad ways) individuals inside large organizations that push the organization further and harder than it’s own momentum and it’s own comfortable pace of progress.
Some companies like Google and Facebook were designed with recognition of how difficult it is to incorporate even the mildest, most socially adept intra-or-entre-preneurs into their corporate cultures. For everyone else…Houston, good luck with your problem.
A mature business is very different than a start-up disruptor. Instead of leaping out of nowhere to take over our daily lives, an existing large company should be looking to create new, but lasting, competitive advantages. It is very difficult for a large company to disrupt itself through introduction of new products or new directions — the burden to create a meaningful contributor to already high revenue is very high. And it rarely happens. A mature business has it’s own momentum; Most individual brilliance, even that of inspired entrepreneurs, is lost in the huge ocean of revenues.
To be successful over a long period of time, an existing and succesful company has to constantly introduce of new, long lasting competetive advantages. Over time, the value of individual innovations and assets erodes, so the act of introducing new comptetive advantages has to be constant. Companies that constantly create new ways to outpace their competetition win in the long run.
Innovation and entrepreneurship is fantastic, but for a large organizations it is the portfolio of innovations that can make a long term impact. So much like Google, organizations can create a long lasting competetive advantage by creating an innovation center.
Competetive advantages can be found in any operating aspect of the bsuiness. For example, some of the competitive advantages that I helped build out at my prior employers are pricing strategy, research infrastructure, CRM implementation, strategic account management program, incentive compensation, and employee training.
A hiring strategy, and corresponding job descriptions, should therefore be aligned with definitions of success. Is the firm looking to hire someone to lead a creation of a new product or revenue stream or they looking for someone to create a new competitive advantage? For the latter, we’ll repurpose the word intrapreneur for this, the qualities that hiring managers should seek are:
- Systems Thinking and Design skills
- Cross Functional experience
- Project Management skills
- Effective Communication skills
As importantly, hiring managers should avoid anyone for these roles that is:
- Emotionally tied to being on a particular team or project
- Has deep knowledge of one field
It is important to realize that intrapreneurs are mercinaries or fixers. They are sent in to change a system, hand back the reigns to their long term owners, and move on to the next system.
If you consider yourself an intrapreneur, or are considering a career as one, know these truths:
- Your job is to implement or redesign organizational systems not create products or lead transformations.
- Lose all emotional attachment to any effort, because you are the interim president of something with no future elections scheduled with you on the ticket, ever.
- It is unlikely that you will move beyond middle management as an intrapreneur, but you will learn more about the organization and your businesses than most of the senior leadership.
To be successful, companies should align their recruiting strategy with their growth strategy. Entrepreneurs are amazing at creating and launch new products or revenue streams, but only if they are placed in an environment that is aligned with their style. Intrapreneurs can give you a long lasting boost by upgrading existing processes, but only a few are necessary.