Entrepreneurial

Architecture

Chapter 3
 Entrepreneurial
Transformation

Replicating within the company:

• The entrepreneur’s character traits
• Their approach to managing change
through uncertainty

DNA
 Architecture

Architecture is the relational contracts

within and around an organisation -
with customers, suppliers & staff. It
is based on trust & underpinned by
mutual self-interest

John Kay
 The Learning Organization
• Facilitates learning for all its members
• Continuously transforms itself, thriving in a
changing environment
• Encouraging systematic problem solving
• Encouraging experimentation & new
approaches
• Learning from past experience & history
• Learning from best practice & outside
experience
• Being skilled at transferring knowledge in the
organization
 The Wheel of Learning
Know-How Form
concepts

Reflect Test
concepts

Experience

Know-Why

Mental Models
 Assumptions
 Theories about the world
Daniel Kim 1993
 Learning Organization
Concepts
• True learning happens by understanding
causality - acquiring both know-how and
know-why through the wheel of learning
• Mental models are shaped by & help shape
experience
• Learning happens when you share, examine &
challenge mental models
• The most effective learning is social & active –
not individual & passive
• The most important things to learn are tacit
things – intuition, judgement, expertise
 Dominant Logic

• The ways managers conceptualize the

business & make resource allocation
decisions
• The mind-set with which they see the
organization
• It filters information
• A social construct which is the
accumulation of mental models which
can be changed over time
 Complexity Theory

Three requirement for self-organization:

• Relationships: the pathways through
which information is transformed into
intelligent, coordinated action
• Identity: permits a common sense-
making process within the organization
• Information : provides the possibility of
synchronized behavior
 Entrepreneurial
Architecture

LEADERSHI
P
CULTURE STRATEGIE
S

STRUCTURE
S
 Architecture

• It replicates the entrepreneur’s ability

to build relationships
• It is informal
• It allows organisation to act quickly
• It creates organisational learning &
knowledge
• It is difficult to copy
• It creates barriers to entry
 Shaping Architecture

Environment
Culture

Leadership Architecture Strategy

Structure
Environment
 External Environment

Entrepreneurial organizations thrive in:

• Changing, unstable, disruptive,
chaotic environments
• Times of recession & growth
• But appropriate architecture varies
across markets & countries with
different leaders
 Internal Environment:
Entrepreneurial Intensity
Degree of
entrepreneurship
High In
cr
Periodic/ ea Revolutionary
sin
Discontinuous g
nte
re
pr
en
eu
Dynamic ria
l in
ten
sit
y
Periodic/ Continuous/
Incremental Incremental
Low High
Frequency of entrepreneurship
 Entrepreneurial
Architecture

LEADERSHI
P
CULTURE STRATEGIE
S
STRUCTURE
S