Entrepreneur More Than A Position
The entrepreneur has become the toast of the town. Still, many folks remain confused about the nature and role of the entrepreneur.
Q. Your column has examined various roles played by the entrepreneur, including that of “corporate entrepreneur.” The thought of being a “mover and shaker” in the corporate environment really appeals to me since, at present, I’m essentially buried in big company bureaucracy. However, I read a recent article by Bill Gates in which he claims that the only true definition of an entrepreneur is “one who starts a business.” Who’s right?
A. Me, of course. While Bill will probably go down in history as one of the most successful entrepreneurs who ever lived, I can’t agree with his narrow definition of an entrepreneur.
In the article you’ve cited, Mr. Gates embraces the classic definition which holds that an entrepreneur is “somebody who has started his or her own company.” He decries the fact that the title has become almost meaningless since “it has grown to have many positive connotations with little specificity.”
Gates focuses exclusively on the economic function of an entrepreneur, not on the behavior that allows that activity - as well as other important functions - to be performed successfully. We should keep in mind that, throughout history, the term “entrepreneurship” referred to a type of behavior as well as to a role played.
Of French origin, the word is derived from “entre prend,” words that signify “between-taking,” the activities by which an entrepreneur seizes a position between resources and opportunities and, because of his or her unique behavior, makes something positive happen.
One of the first uses of the word was in the late 1700’s by Jean Baptiste Say, an economist who is credited with developing the concept of entrepreneurship. He described an entrepreneur in terms of behavior.
“He is called upon,” said Say, “to estimate, with tolerable accuracy, the importance of a specific product, the probable amount of demand, and the means of production; sometimes to employ a great number of hands; again to buy or order raw materials, to combine the workers, find consumers, to exercise a spirit of order and economy. In the course of such operations there are obstacles to be surmounted, anxieties to be overcome, misfortunes to be repaired, and expedients to be devised.”
Save but for the first word, this is an accurate definition today. During the 19th century the “ability to take calculated risks” was added to the definition. By mid-twentieth century, the importance of innovative talent - the ability to find and profitably introduce new and better products, services and processes - was recognized and included in the entrepreneur’s “job description.”
At no time, however, was it concluded that these important business-building tasks could only be performed by someone who is starting a new enterprise. Today these are critical tasks in every business firm, from the corner car lot to General Motors. Companies of every stripe - new, old, emerging, established - all depend upon entrepreneurial behavior to achieve survival, success and sustainability.
Indeed, innovative talent has become the hallmark of the entrepreneur. Given the rapid changes in contemporary markets, technology and competition, it has become incumbent upon every manager to constantly re-create the enterprise for which he or she is responsible in order to keep it vital and relevant. A successful enterprise demonstrates a continuum of “start-over points,” each one recasting the venture in form or function to master the challenges and opportunities du jour.
As a consequence, business owners can never outgrow their entrepreneurial beginnings, and managers must learn how to perpetually perform as entrepreneurs. Each must be able to continuously identify opportunity, organize talents, assume risks and make ready decisions to profitably create value for the marketplace.
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