An entrepreneur is loosely defined as a "risk taking business person." Entrepreneurs are widely admired for making the seemingly impossible happen, for turning fuzzy ideas into billions of dollars. In fact, it could easily be said that our ideal of business virtue is contained within our vision of the lone idealist, struggling against seemingly insurmountable odds, to create enduring businesses that change the world. Bill Gates. Tom Watson. Harlan Sanders (if you like deep-fried chicken).
Short detour: Since we are talking about the modern corporation, I am going to assume for the purposes of this principle that anybody who works for a company is a "business person." This in fact is a really bad assumption, as we will review later. But for now let it be taken for granted (like most people do) that if you are getting paid by a company to work at a company then you are a business person.
Back to our regularly scheduled program. Let's start with the obvious. You start out as a drooling mass of unintelligible baby flesh. You don't walk, talk, think, throw a ball, have social interactions or put forth an argument. Check in five years later and that same cute gurgling goo machine is doing all this and more. It happened to all of us so we just take it for granted, but the fact is that it is a pretty impressive act of will and genetics replicated thousands of times a day.
Many people smarter than I have forwarded many
interesting and provocative theories as to how this all happens, but let me put
forth a pretty simple one: we are all born entrepreneurs. We all see something
we want and go for it. We don't wait for mommy's and daddy's approval to walk,
talk or beat up the bully down the street. We want to do it and we go for it.
Seven million years of biological programming kicks in, we get clarity about
what is important and what isn't and we don't stop until we have what we want.
Now take that five year old and put them in the modern corporation at the age of 35 and the drive that created a walking, talking arguing machine has been squelched. Now we are sitting, fuming filing machines. Our ability to determine what we really want has almost been beaten out of us and our fundamental drive to go for what we know to be right is almost completely gone.
As we explored many times, the utility of the whole
"cogs in the wheel" method of business is decreasing rapidly. Whether
it's right or not (and, to be clear, it's not), you pay the same for an excited
employee as you do a drugged-up dullard. When all that mattered was the ability
to walk upright and fog a mirror, it didn't make much of a difference whether
the person you hired was pumping mental iron or blue Quaaludes. In the creative
age, it matters.
So we are all ghosts in the machine, walking, talking
robots who keep a picture of a tropical island right next to the company
holiday schedule, pining away for the day when you can we retire and really
enjoy life. Let the guys with the good hair and fancy suits be "entrepreneurs."
You are moving from meeting to hopeless meeting on auto-pilot.
How odd that we would just accept this misery as the
status-quo. It's not good for the company, not good for those day-trading
shareholders and it's certainly not good for you. Assuming that time is
constant (take that Einstein! Time-space continuum hooey!), then wouldn't you
rather pass the time you burn under the fluorescent sun doing something that
matters to you and makes a difference to others? Sure you would! And unleashing
your inner entrepreneur is the best way to make that fantasy a reality.
Time and time again, working with people who see
themselves as helpless automatons living for the next paycheck I have been able
to reconnect them to that biological entrepreneurialism. And when they do their
performance and happiness both increase. The modern corporation is obsessed
with controlling risk so that they can get money when they need it. But by
putting money first they have stripped the basic capabilities of their most
important resource: human creativity and drive. Since Talentism puts talent
before capital, we seek to reconnect everyone with their inner start-up.
By making this "we are all entrepreneurs" argument I am not saying that everyone has the same propensity for risk taking. There are people who jump out of perfectly good airplanes for fun and there are people who won't even go up in a jumbo jet to travel to Pittsburg. When it comes to thrill-seeking, we are not all created equally. But there is a far distance between the typical white-male, macho bullshit social Darwinism argument and the reality that most people, if given the opportunity, want to feel that they can make a contribution and have a greater degree of freedom in determining how they can make that contribution. By saying we are all entrepreneurs I am not saying that we all have to be perfectly coiffed demigods looking for our next trophy wife (or husband). But I am saying that the modern corporation would do well to unleash the inner creativity, drive and inherent problem-solving skills of their employees, and that the most successful model to date to do this is the risk-taking, devil-may-care environment of a start-up.
As I have said before, and will repeat many times in the future (I understand, this is all difficult to believe), I am not talking about feel-good, fuzzy-headed, let's-all-join-hands-and-form-a-collective thinking. So here is the argument in business terms: in the creative age (where both switching costs and cost-of-entry are decreasing in most markets other than resource extraction and where the value of an asset is increasingly determined by its velocity rather than its longevity) the nominal benefit of risk aversion is negative to neutral, while the nominal benefit of maximizing your investment in your human capital asset has a high probability of being positive, independent of which system you employ to sustain that increase in utility (see the Hawthorn experiment). Or, in English - you aren't getting much by keeping people down, and you will get a whole lot when you unleash their capabilities. Or, another way: focusing on risk prevention is possibly the riskiest strategy you can follow.
History has proven that entrepreneurialism is far-and-away the best economic model for aligning people's hopes, desires and competencies with a shareholder's return. The reason is simple: you can't unleash a person's passion by telling them how to do their job, berating them for doing what they think is right or sending them off on wild goose chases to sate your unquenchable ego. And in the creative age, it doesn't pay to do any of those things anyway.
Future posts in this series will be shorter and less bitter (I thought it was a stretch to say "sweeter"), so keep the faith. And take the risk of letting someone run their own business.
Next: "Part 4 - Purpose before Profit"
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