Introduction

Recent focus on the information and knowledge economy is now changing to entrepreneurship and generating entrepreneurial mindset as a solution to growth and development

"...there is no science to being an entrepreneur; but there is a method..."

Ryan Trainer as quoted by John Stensholt, 2014

Entrepreneurship is a skill

The definition of entrepreneurship should be divorced from risk. Many people associate entrepreneurialism with risk-taking. Yet most entrepreneurs have evaluated and thought of ways of handling the risk in any venture.

Some quotes from Peter Drucker are

"...The best way to predict the future is to create it..."

Peter Drucker as quoted by Fortune Magazine, 2006a

"...Any business enterprise has 2, and only 2, basic functions - marketing and innovation..."

Peter Drucker as quoted by Al Ries, 1997

Furthermore, he stated entrepreneurs are people

"...who create something new..."

Peter Drucker as quoted by Geoffrey Colvin, 2005b

At the same time

"...Organisational innovation has always lagged behind technology innovation..."

Gary Hamel as quoted by Catherine Fox, 2007l

Many organisations that downsize, practise cost-cutting, etc have found that they cannot shrink their way to success. Furthermore, they have found they cannot grow rapidly by tweaking existing services and products, diversifying, merging, forming joint ventures/partnerships/alliances, etc, take-overs, moving to developing countries, etc. As a result and

"...because of maturing technologies and aging product portfolios, a new imperative is clear: companies must create, develop and sustain innovative new businesses..."

David Garvin et al, 2007

As organisations grow, they become less flexible and as a result, maintaining the pace of growth becomes harder. This forces organisations to search for new sources of revenue (markets, products, services, etc)

Disruptive technologies facilitate the emergence of new markets but initially it may not be very lucrative
"...there is no enduring formula for creativity......When we attempt to production innovation we breed out the very thing we trying to raise: the creative destruction that stokes and re-stokes the fires of capitalism..."
Alex Payne as quoted by James Hutchinson, 2014b

Research is showing (Patrick Durkin, 2014) that many large organisations don't understand what innovation is, how to encourage it or even how to measure it. Some examples, innovation is not included in the key performance indicators, there is no policy or structure to learn from failure, etc
"...companies are fundamentally risk adverse and innovation requires you to embrace risk..."
David Munn, 2014

There are 3 components to innovation
i) efficient innovation (produces the same product more cheaply like an automated production line, etc)
ii) sustaining innovation (changes a good product into a better one, like hybrid cars, etc)
iii) disruptive innovation (transforms an expensive, complex product, service or business model into affordable, simple ones, sometimes using different channels to access customers like smart phones, social media, etc)

The third one can fundamentally change the economics of an industry overnight and presents the greatest potential for growth. On the other hand, they are generally a small percentage of all innovations.

How to embed innovation in your organisation's culture
- encourage risk-taking by defining where you are willing to take risks and lead by example
- engage employees to streamline operations, etc
- recognise success and/or worthy failures
- engage with all stakeholders, especially customers
- use social media, technology, etc to get feedback
- implement good ideas quickly

For example, Google allows 20% of their engineers time to be dedicated to free work, ie explore new ideas and think about things to try to come up with the next new idea. Need to allocate more than time and staff to innovation. Need to encourage the willingness to try a new challenge and reduce the fear of failure so that íts safe to fail, ie if there is no willingness to fail, you have no hope of success
NB "...Ideas are a dime a dozen, people who implement them are priceless..."
Mary Kay Ash as quoted by Patrick Durkin, 2014b

 

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