ENTREPRENEURIAL LEADERSHIP

Learning objectives

To give brief introduction of entrepreneurship and leadership. To give know how about the successful entrepreneurs. To explain the role of entrepreneurs as a leader. To explain the role of entrepreneurial leadership. How we can construct entrepreneurial culture.

Entrepreneur & Entrepreneurship?

An entrepreneur is an individual who owns a firm, business, or venture, and is responsible for its

development. Entrepreneurship is the practice of starting a new business or reviving an existing business,

in order to capitalize on new found opportunities.

Successful Entrepreneurs

There are six dominant themes for successful entrepreneurs:

Leaderships Commitment and determination Opportunity obsession Tolerance of risk, ambiguity and uncertainty Creativity self reliance and ability to adapt. Motivation to excel.

Who is leader……….?

Someone who can influence others and who has managerial authority

orA leader is a person who can influence or motivate others to do what he wants them to do.

(Burns, 2007)

What is leadership…….?

The process of influencing a group

towards the achievement of

goals.Leadership is the art of motivating a group of people to act towards

to achieving a common goal.

(Burns, 2007)

Food for Thought

An entrepreneur who starts his own business generally does so because he is a difficult employee.

He is probably finds it difficult to be in the alternating dominant and then submissive role so often asked of management.

He also believes he can do the job better than others, which may be true BUT……..

(Burns, 2007)

Food for Thought

He must find a way of working with and through others if the business is to grow.

And here the person must start to make a transition from being a mere entrepreneur to a leader.

(Burns, 2007)

Entrepreneurial Leadership

Entrepreneurial leadership is about systematic and purposeful development of leadership skills and techniques which can take a long time. It is about the developing relationships. It is about creating long term sustainable competitive advantage based upon architecture of entrepreneurial leadership.

(Burns, 2007)

Management vs. LeadershipCreating an

agendaPlanning and budgeting, establishing detailed steps and timetables for achieving needed results and allocating resources accordingly

Establishing direction, developing a vision of the future, often the distant future and strategies for producing the changes needed to achieve vision

Developing a human network for achieving the agenda

Organizing and staffing, establishing some structure for accomplishing plan requirements, staffing, delegating responsibilities, providing policies, and creating monitoring systems

Aligning people, communicating the directions and accept their validity

Execution Controlling and problem solving, monitoring results and plans in some detail, identifying and solving problems

Motivating and inspiring, energizing people to overcome barriers by satisfying their needs

Outcomes Producing a degree of predictability and order, consistent production of expected results

Producing change, often to dramatic degree, potential to produce extremely useful change

(Timmons, 2008)

Role of Entrepreneurs as a leader

A successful entrepreneurs are ‘patient leaders, capable of instilling tangible visions and managing for the long haul.

There five elements include in the job for leader: Having vision and ideas. Being able to undertake long term strategic planning. Being able to communicate effectively. Creating an appropriate culture within the firm Monitoring and controlling performance. Having the courage to delegate Controlling the business by monitoring information rather

than by direct physical intervention.

(Burns, 2007)

An entrepreneur must change his role towards these FUNCTIONAL disciplines i.e

Marketing Accounting People Management all change

In other words the business needs to become more formal without becoming more bureaucratic.

(Burns, 2007)

Role of Entrepreneurs as a leader

So the challenge is not only in developing the business but also to cope with the managerial change facing the founder.

Having your own vision is relatively easy. Building a shared vision is no easy task.

The challenge for an entrepreneur is to convert the contractual employee of an economic entity into committed member of a purposeful organization.

(Burns, 2007)

Role of Entrepreneurs as a leader

Role of Entrepreneurial Leadership

The primary role of good entrepreneurial leader is to build an entrepreneurial architecture.

The entrepreneurial architecture creates with in the organization the knowledge and routines that allow it to respond flexibly to change and opportunity in the way the entrepreneur does.

It is a very real and valuable asset that creates that creates competitive advantage and can be sustained

(Burns, 2007)

Three Principles of Entrepreneurial Leadership

Treat others as you would want to be treated

Share the wealth that is created with all those who

have contributed to it at all levels

Give back to the community

(Timmons, 2008)

Challenges for entrepreneur during growth of firm

Growth through creativity

Growth through direction

Growth through delegation

Growth through coordination

Crises of Leadership

Crises of autonomy

Crises of control

Crises of red tape

Collaboration

(Burns, 2007)

Entrepreneurial Organization structure

Spider’s Web Spider’s Web Grows

(Burns, 2007)

Entrepreneurial Organization structure

Hierarchical Structure

Matrix Structure

(Burns, 2007)

Churchil and Lewis Growth Model

Existence Success Maturity

Disengagement

Growth

(Burns, 2007)

How can a Entrepreneur Lead?

A Entrepreneur can lead through three different ways/Styles

Leader and Task Leader and Group Leader and Situation

(Burns, 2007)

University of Michigan

Employee-oriented:Emphasize interpersonal relations

Production-oriented:Emphasize the technical or task aspects of the job

Leader and Task

(Burns, 2007)

University of Michigan

Research findings:

Leaders who are employee oriented are strongly associated with high group productivity and high job satisfaction.

(Burns, 2007)

Managerial Grid

Appraises leadership styles using two dimensions

Concern for People:Measured leader’s concern for subordinates on a scale of 1-9

(low to high)Concern for Production:

Measured leaders’ concern for getting job done on a scale of 1-9

(low to high) (Burns, 2007)

The Managerial Grid

Concern for Production

9

8

7

6

5

4

3

2

1

1 2 3 4 5 6 7 8 9

Co

nce

rn f

or

Peo

ple

(1,9)

(1,1)

(5,5)

(9,9)

(9,1)

Impoverished ManagementExertion of minimum effort to get required work done is appropriate to sustain organizational membership

(Burns, 2007)

The Managerial Grid

Concern for Production

9

8

7

6

5

4

3

2

1

1 2 3 4 5 6 7 8 9

Co

nce

rn f

or

Peo

ple

(1,9)

(1,1)

(5,5)

(9,9)

(9,1)

Task ManagementEfficiency in operations results in the accomplishment of work in Such a way that there is minimumInterfere of human elements

(Burns, 2007)

The Managerial Grid

Concern for Production

9

8

7

6

5

4

3

2

1

1 2 3 4 5 6 7 8 9

Co

nce

rn f

or

Peo

ple

(1,9)

(1,1)

(5,5)

(9,9)

(9,1)

Middle of the road ManagementAdequate organizational performanceIs possible through balancing the necessity to get out work with maintaining morale of the peopleAt a satisfactory level

(Burns, 2007)

The Managerial Grid

Concern for Production

9

8

7

6

5

4

3

2

1

1 2 3 4 5 6 7 8 9

Co

nce

rn f

or

Peo

ple

(1,9)

(1,1)

(5,5)

(9,9)

(9,1)

Country Club ManagementThought full attention to needs of people for satisfying relationship leads to a comfortable friendly organizational atmosphere & work tempo

(Burns, 2007)

The Managerial Grid

Concern for Production

1 2 3 4 5 6 7 8 9

Co

nce

rn f

or

Peo

ple

(1,9)

(1,1)

(5,5)

(9,9)

(9,1)

Team ManagementWork accomplished is from committed people, Interdependence through common stake in organizational purpose leads to relationship of trust and respect

9

8

7

6

5

4

3

2

1

(Burns, 2007)

Leader and Group

Participative

Consultative

Paternalistic

Autocratic

Low High

High

Low

Group autonomy in decision-making

Leader Authority

(Burns, 2007)

Leader and Situation

Must move away from using autocratic/ dictatorial

leadership style

Must be adept at using informal influence

Must be adept at conflict resolution

(Burns, 2007)

Strategic Planning ProcessVision

Strategic Analysis•The organization( strengths and Weaknesses)•The environment (opportunities and Threats)

Strategy Formulation• Identify Strategic Options• Evaluate options• Select Strategy

Strategy Implementation•Leading and Managing Change•Organization Structure and Culture•Planning and Allocating Resources

FeedbackLoops

(Burns, 2007)

Constructing an Entrepreneurial culture

Hofstede (1990) explain different dimensions of organizational culture in an attempt to discriminate between entrepreneurial and administrative organizations.

Timmons, Peters (1997) and Cornwall and Perlman (1990) explain tits following elements:

People and empowerment focus Commitment and personal responsibility Doing the right thing Value creation through innovation and change Hands on management Freedom to grow and fail Attention to basics Emphasis on future and sense of urgency. (Burns,

2007)

Remember

“Management is doing things right; Leadership is doing the

right things”

Peter F. Drucker