The New Entrepreneurial Economy #innovation #business #culture
Imagine this scenario:
Jane – a thirty–something mother of two, a career woman and one of Company X's best and brightest employees – walks into work one day with a surprise. She's been awarded the chance to run a division of Company X. Only she's not running that line of business, she owns part of it. And if she succeeds, there's more in store for her, including the opportunity to spin off the division and take it public. Jane has now gone from an employee to an entrepreneur.
Here's another scenario:
Jose – a forty-something neuroscientist who, over the last 12 years, has been developing biomedics software for Company Y – decides that his real passion lies in predictive analytics. He tells his supervisors how he's feeling, proposes a gameplan for how he sees PA playing a role in advanced research, and the Company decides to support Jose with relevant coursework and an incremental program that transitions him into a new role. The Company feels that Jose is a great intellectual and cultural asset and want him, one day soon, to build a line of business around his idea for which he can raise money internally or externally and own equity. They're grooming him to become an entrepreneur inside the walls of the Company.
And another scenario:
Frida – a graduate student getting an advanced degree in product design – has been courted by Company Z for the better part of two years. They see her as a bonafide engineering rockstar. She's not sure how she feels about the joining the Company, after all, she's had her heart set on building a business of her own, and she's got a great idea for a sustainable product that can scale in an emerging market. She tells Company Z what she's thinking… and they decide to fund her operation in a joint-venture capacity. Their rationale: better to support her entrepreneurial spirit and potentially gain from a partnership, than to lose the resource altogether as an employee.
Bob – a schoolteacher with a knack for building things – accidentally invents a trinket that allows his students to learn their mathematical tables much more efficiently. He brings the prototype to the school board, and in a partnership with a local corporation, they fund the production of several thousand units to be outfitted in schools across the region. Bob is made the CEO of the new division; in the agreement it is outlined that he still gets to teach a few classes a week as part of the ongoing research and development of the product.
These scenarios aren't that unusual. It's just that you don't hear about them or read about them all that much. What mostly grabs headlines are stories about start-up darlings and powerhouse businesses, yet very little is mentioned about companies and individuals who have chosen to become entrepreneurial… Together.
As someone who builds technologies and advises companies that build them, I won't go into the many problems we face here in America with respect to our labor pool, the lack of digital literacy or our insufferable attrition rates, but I will say that after traveling the world over, there are a good number of countries getting it right: they're investing in their own people and truly banking on their success.
Regarding America and the "free world", the immediate future will not be one in which you graduate to a job, become a life-long employee of a company, or develop vocational skills aligned with one area of interest, trade or industry.
Nope. Those days are saying their last goodbyes.
Between all the campaign noise generated by American political parties and their frontrunning candidates, the economic woes we seem to face in perpetuity, and an egregious disconnect between mainstay issues like education, parenting and our work force (the amalgam of which we might describe as culture at large), we need innovation, at some point soon, to become our bedrock.
We really, really do.
But I would submit that innovation is a next step for us, a "phase two" of sorts, a place of manifest to which we transition, not something we can merely step into because we've already declared it as so. And while our accomplishments as a young nation or a young free world are vast, we've also placed innovation on a pedestal, often times inside of an ivory tower, along with a long range of other well-intended western ideals… Not the least of which have become stifling by-products of greed and excess.
With that said, this isn't really about fuzzy notions of capitalism, political ideology or cultural self-interest. We can simply look to the dynamics at play within the systems we call our own.
Since modern industrialism entered the picture, and corporatism first bore its greasy elbows – for good and for worse – innovation has fallen under the domain of commerce. Companies and their myriad transactional systems have literally come under fire to produce optimal results with increasingly less time, less money, less attention, less resource, scattered focus and little insight into the future… Mostly because they have been fighting to keep their heads above water. To put it more bullishly, many companies are having a hard time navigating the now. In some cases, the result is a mad dash to inflate margins and get semi-creative with all the things that ultimately don't matter (like stock options), leaving people – you know, the employees – as commodities forced to defend their scraps of tasteless meat. And while we can automate these colorfully dysfunctional corporate systems, technology itself, no matter how sophisticated it may be, cannot solve our problems on its own.
Making money and sustaining profitability is not the core issue in our capitalist landscape, for that matter. Recalibrating our sense of wealth is.
To that end, innovation is a mindset. Entrepreneurs are the catalysts.
Market growth is a slingshot when both are empowered. And there are rich caveats to this, depending on your definition of the adjective.
It doesn't take an economist to realize the depressed state we're in globally, or a sociologist to tell us that we're hardwired to default to Darwinian behaviors, nor do we need science to validate our claims over the direct and latent effects we feel at the local level. Whether the joy and pain come through our heads, our wallets, or both, entrepreneurialism is the manifested state we need to reach, and can reach, in the near term. But there's also a significant price we need to pay, which is that we can't all "live off the fat" anymore — we have to roll up our sleeves, bury our heads and invest in each other. Life has proven, most dutifully, not to be an interest-only loan.
So you still might ask, after having read the scenarios above: "Just what is this investment, and where exactly does it go?"
Over the last two decades or so, maybe longer, politicos have waved the entrepreneurial flag somewhat sadistically under the guise of small business. Yet, for the most part, real businesses need real business investment – downgrading credit, imposing highly restrictive loan thresholds, consolidating flimsy infrastructure or bilking niche movements for an uptick in market opportunity is not a steady course for change or profitability. In other words, we have the systems we need already in place. We need to improve them, build upon them, make them extensible, make them adaptable, and far more agile.
More importantly, we need to make them culturally fit for reinvention. Cultural fitness requires that companies and institutions adapt to the behaviors and actions of the marketplace, so that reinvention can be made possible. And who better to lead that charge than the wide-eyed, steely, self-possessed, crafty and resilient entrepreneur. The dreamweaver himself.
The net-net? You bet there's lots and lots of money in reinvention. Tons of it, in fact. To boot, entrepreneurs can align and federate their own systems of change and create the new "industry standards", if you will.
But first things first.
It seems that there are two kinds of companies or institutions operating within the current landscape (the rest are, dare I say, already being rendered obsolete):
1. Those reacting to or subsisting on entrepreneurial change;
2. Those thriving on entrepreneurial pressure or tension.
The companies or institutions that react to or subsist on entrepreneurial change will continue to do so on the terms of the market, and not so much on what the market can bear, but rather what it is willing to give. These entities will continue to find that most people with the skills to innovate – in other words, folks who can do the things that the entities themselves cannot do or are not willing to do – will not want to work in a full-time capacity or be beholden to projects that don't expand their creative and intellectual capacities. So these entities will continue to compromise. And they will do so at their own peril.
The companies or institutions that thrive on entrepreneurial pressure or tension will continue to find ways to build business units around reinvention, and, they will continue to invest in start-up or middle-stage businesses that exist on the periphery. These entities will continue to leverage their own infrastructure – supply chains, funding centers, resource pools and the like – in order to vet out the very markets in which they play, and identify emerging markets they can immediately build investment toward. These entities will continue to win, and win big, because they are creating new or refurbished value systems with their customers or partners based on real market needs, not on artificial levers for demand.
And guess what will become the primary levers for demand: better educational systems, better governmental systems and stronger media systems that in turn will revamp infrastructure and create emerging markets. This isn't advanced economic theory either, it's just… not-so-common sense.
Perhaps the "ecosystem" looks like this.
The ecosystem is comprised of core tenets, or sectors, that contain many other industries – all exhibit lateral or horizontal characteristics; for example, "media" can include advertising & marketing, film, television, print publications and myriad Internet businesses — all can cross over into other areas of interest or industry. "Enterprise" would include every company type from small businesses, to start-ups, to middle-stage companies,to large institutions — all can and do cross over into other areas of interest or industry. "Government" would include not only local, state and national branches, but new divisions and extended innovation arms as well. The main thrust of this is to emphasize that industry, government, enterprise and education all feed into the same commerce structure. All parts are interconnected and mutually inclusive of economic levers for growth and sustainability.
What is becoming more glaringly obvious to us all is that if we don't start fueling our passions and interests with fungible expectations, the American Dream will die off along with all of its counterparts. This is no longer an economy of hyperactive transactions and superfluous upsells of God-knows-what — we may see those elements frequent our minds, our debit cards and our inboxes, but they do not sustain our livelihoods. A crash diet of massive debt, broken promises, false dichotomies and abject corporate insolence simply isn't going to cut it when human evolution is handing us a wildly different stack of cards.
Wonder why social commerce is the new, new thing? It's simple: relationships supersede transactions. And this was the case well before mercantilism came around. Call it "social capitalism" or something else, I don't really care. The point is that failing markets and failing institutions will determine our state of economic integrity until we prove ourselves otherwise.
Systemically, whatever gives way to the development of intellectual growth and goodwill is going to affect the bottom line. You can bet on that. Whether you choose to act on it is an entirely different story altogether.
Here's the brighter picture, perhaps not all that ironic: we don't really have a choice. Not in the sense that taking stock in our livelihood forces us into a position of proactivity or coercion, and for the collective hope of subverting bottomless compromise.
There, I've said what many of you are probably thinking anyway.
But really, what do you think? What's your take on the new entrepreneurial economy?
Don't hesitate to speak up – we could be in business together sooner than you think.
I would be remiss not to mention some of the folks that have greatly inspired and informed my thinking in this arena:
John Seely Brown
The late, great C.K. Prahalad