Академический Документы
Профессиональный Документы
Культура Документы
INTRODUCTION
PROFIT ORGANIZATIONS
NON-PROFIT ORGANIZATIONS
CONCLUSION
REFERENCES
INTRODUCTION
Austrian economist, Joseph Schumpeter presented a vision of the entrepreneur as someone motivated by the dream and the will to found a private kingdom, the will to conquer: the impulse to fight, to prove oneself superior to others, and the joy of creating. (Schumpeter, J., 1975). Theoretically, the entrepreneur is inspired to alter an undesirable state of events and starts to think creatively (usually in an out-of-the-box way) on a solution, takes action in a courageous way, despite the risks, and persists until the solution is generally accepted. Many examples of such people exist; Jack Welch, The Wright Brothers, Philip Condit, Arthur Fry and a host of many others. Although it can be argued that a lot of entrepreneurial ideas fail for many reasons, one of which is tunnel vision by the entrepreneur who thinks his ideas are God sent, more often than not, entrepreneurs add value to businesses, create new markets and new services that improve the lives of others and also earn, in some cases, huge profits for their organizations. Theorists in support of this concept see entrepreneurs as being indispensable to market economies. Michael Porter presented the three business-level generic strategies: Cost Leadership, Differentiation and Focus and postulated that a firm cannot achieve competitive advantage without utilizing one or a combination of these strategies. (Porter, M., 1980) The components of a firms strategy should comprise its objectives, scope and advantage. Entrepreneurs exist in different forms of organizations which will be examined in two main forms: Profits and the Notfor Profits. Both types utilize strategies to be able to exist and compete in their particular industries and if these strategies encourage entrepreneurship, the entrepreneurs will blossom. Entrepreneurs are indispensable to implementing a firms strategy providing that this strategy seeks to ensure that the firm evolves to meet the needs of an ever-changing market. The Profits will be subdivided into Start-ups/New Ventures (which will be examined in relation to Small Businesses), and Large businesses. The Not-For-Profits will be examined in the context of social entrepreneurship. The social entrepreneur targets a usually disadvantaged population that lacks the financial means or political clout to help itself.
Concept
The entrepreneur is inspired to alter the unpleasant equilibrium. That was what happened to Arthur Fry of 3M. He got the idea, in church, of using the reusable adhesive developed by his colleague, Spencer Silver, to provide his bookmarks in the hymnal with the temporary anchoring they needed. (3M, 2008) The entrepreneur thinks creatively and develops a new solution that dramatically breaks with the existing one. Orville and Wilbur Wright were the first to invent an airplane controlled to move in 3 dimensions as opposed to just going straight. (The Wright Brothers, 2008) Once inspired by the opportunity and in possession of a creative solution, the entrepreneur takes direct action. Jack Welch, legendary CEO of General Electric (GE) took action to restructure GEs bureaucratic, command-and-control structure and reduce the many hierarchical layers of management. (Welch, J., 2001)
Entrepreneurs demonstrate courage throughout the process of innovation, bearing the burden of risk and staring failure squarely if not repeatedly in the face. The Wright Brothers kept testing their airplanes, risking life and limb to do so. Finally, entrepreneurs possess the fortitude to drive their creative solutions through to fruition and market adoption. When Arthur Fry persisted in his dream of the Post-it Note, a revolutionary new product which could be used as a bookmark as well as an office organizer, 3M finally sat up and took notice and then began to invest in it, designing and building special machines for its production.
was in charge of the team that launched the Boeing 777 airplane. Boeing, an 80 year old company, had become a rigid, bureaucratic corporation with highly centralized layers of decision makers. Communication within the functional departments was nearly non-existent, and this created costly production delays. Boeing was in need of major restructuring, especially because the delivery times for the new airplane, the 777 was slow about 18 months. (Lubove, S., 1996) Philip Condit destroyed the old bureaucratic walls within the company and organized hundreds of cross-functional teams called design/build teams involving customers, suppliers and employees to improve coordination across functional areas and work together in producing the 777. These design/build teams have received many awards. Apart from the teams, he reduced the hierarchies by outsourcing most operations and removing most of its middle managers and staff. This restructuring helped to further reduce delivery times for the 777 to 10 months and every year, Boeing saves about $600 million (Boeing, 1995-2008). Large firms normally have many layers of management, bureaucratic structures and unproductive workers. To maintain their competitiveness, they need to re-engineer some portion or the entirety of the organization. A change agent is someone who comes into an organization to initiate a much-needed change in the organizations systems, processes and structure. A change agent can be a management consultant from an external consulting firm or someone from within (usually top management). For an external change agent, the support and total commitment of top management is crucial for success. The main problem change agents may encounter is trying to change a resistant corporate culture.
At the initial stage of this restructuring, tempers flared and employees were upset but gradually, as they saw that this change had come to stay and was for the long-term benefit of all, the culture of the organization began to adapt and fit into a structure resembling what had been envisioned by its change agent Jack Welch. Another strategy he conceived for GE was called Boundaryless which meant a company that would break the dividing walls between customers, staff and suppliers and make them a part of a seamless process. He communicated this goal company-wide: Finding a Better Way Each Day. In line with this Boundaryless vision, he laid off 4 corporate officers because they did not follow GEs core values, even though they made their numbers. (Welch, J., 2001, 234). A good vision challenges, creates a sense of urgency, speaks to a wide audience. Success occurs when the vision becomes embedded in the daily decisions and actions taken by those who are led.
re-released in 1980 and now today, more than 1,000 Post-it brand products are sold in more than 100 countries. Sales of Post-it Notes products are in the billions of dollars per year. Fortune Magazine called these notes the most important office product developed since the invention of the paperclip.
Not-For-Profits
The aim of these organizations is more to provide a lasting transformational benefit for greater good of the society than to make profit, although some of these organizations do make some profit. Social Entrepreneur must identify a segment of humanity undergoing marginalization or suffering that lacks the means to achieve any transformative benefit on its own and must also utilize the entrepreneurial characteristics to change the situation for the benefit of these disadvantaged ones. Theoretically, in comparison to the social activist who creates change by influencing others, the social entrepreneur takes direct action. But in reality, most entrepreneurs in Not-for-Profit organizations use a mix of social entrepreneurship and social activism at the same time. Sometimes these new ventures translate into huge companies, providing a new and exciting answer to a difficult problem or a necessary service supplied to consumers located around the world.
Oprah Winfrey
Oprah Winfrey can also be regarded as a social entrepreneur. Amongst her many accomplishments, she also created The Oprah Winfrey Foundation to support the education and empowerment of women, children and families in the United States and around the world. The charity has awarded millions of dollars to organizations throughout the world to improve education and health care. She also founded Oprah's Angel Network to inspire people to make a difference in the lives of others. So far the group has raised $27 million almost entirely from audience donations. She has achieved her competitive edge by gaining the trust of her audience and by being a tireless social entrepreneur. In her show, she opens herself up to the public, inspires others to live their best life and educates people on a variety of topics. Despite her success, she is humble and warm-hearted. She also keeps a close watch on her brand name; everything with her name on it is put out by her company under her direct supervision. (Oprah, 2008)
CONCLUSION
It cannot be denied that creativity inspired the invention of the myriad products and services that improve life for all. Flying as we know it came about because of the entrepreneurial spirit of the Wright Brothers. All firms (small, large or Not-For-Profits) formulate and implement strategies to ensure a competitive edge in their industries. Entrepreneurs add value to the implementation of the firms strategy by bringing vitality and innovation, especially if the firm encourages innovation and their top management possesses a long-term view of an ideas profitability. For example, Google builds innovation into the very fabric of its culture and its business has grown exponentially as a result. It can be argued that the momentum of some firms which formulate strategies that promote creativity, stall when it comes down to implementation. They become comfortable with their traditions and are reluctant to shake things up. Organizations that do not encourage entrepreneurship and feel that it hampers their strategy, in the long run, will lose their distinctive competences. If employers encourage ideas from the bottom-up, organizations will often gather fresh, money-spinning ideas that enable them compete. Organizations must build a culture of continuous innovation by being ready to invest in risky ventures, celebrate failure and reward, not punish, entrepreneurs that fail. Bureaucratic, large firms must change to keep up with the times, becoming leaner and more productive. General Electric and Boeing were re-engineered and as a result, their profitability increased. More companies must do the same.
REFERENCES
1. Stephenson, H. and Jarillo, J. (1990) A Paradigm of Entrepreneurship: Entrepreneurial Management, Strategic Management Journal Vol. 11: p. 17-27 2. Boeing: Philip Condit, (1995 2008) http://www.boeing.com/history/boeing/condit.html [26th March 2008]. 3. Schumpeter, J. (1975) Capitalism, Socialism, and Democracy, New York: Harper p. 8285. 4. Lumpkin, G. & Dess, G. (1996) Clarifying the entrepreneurial orientation construct and linking it to performance. Academy of Management Review, Vol. 21 p. 135-172. 5. Strickland, A., et al (2007) Crafting and Executing Strategy, 15th Edition, Mc Graw-Hill Irwin. 6. Lubove, S. (1996) Destroying the Old Hierarchies, Forbes, p. 62 - 71.
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7. University of Leicester, (2007) Implementing Strategies, Module 3, Edition 20, Learning Resources. 8. Drucker, P. (1995) Innovation & Entrepreneurship, New York: Harper p. 28. 9. Welch, J. and Byrne, A. J. (2001) Jack, Straight from the Gut. Warner Books Inc: New York 10. Iyer, B. and Davenport, H., (2008) Reverse Engineering Googles Innovation Machine, Harvard Business Review, p.59 -68 11. Knight, F. (1921) Risk, Uncertainty and Profit, New York: Harper. 12. Harpo Productions, Inc (2008) Oprah www.oprah.com [23rd March 2008] 13. Wikipedia, Wikimedia Foundation, Inc., (2008) Small Business, http://en.wikipedia.org/wiki/Small_business [22nd March 2008]. 14. De Wit, Bob and Meyer, Ron. (2004) Strategy: Process, Control and Context, 3rd Edition, 2004, Thomson Learning. 15. Miller, D. (1983). The correlates of entrepreneurship in three types of firms, Management Science, Vol. 29, p. 770-791. 16. Daft, R. (2006) The New Era of Management, , International Edition, South Western 17. Wikipedia, Wikimedia Foundation, Inc., The Post-It note, http://en.wikipedia.org/wiki/Post-it_note [26th March 2008.] 18. The Wright House, The Wright Brothers, http://www.wright-house.com/wrightbrothers/Wrights.html [26th March 2008] 19. Gartner, W.B. (1988). Who is an entrepreneur? Is the wrong question, American Journal of Small Business, Vol. 12, p. 11-32. 20. 3M, http://solutions.3m.com/wps/portal/3M/en_US/global/sustainability/ceostatement/strategies/ [26th March 2008.]
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