Entrepreneurship is often associated with startups, but does it also apply to governments and to medium-sized and larger enterprises? We recently asked this question of Mike Lyons, a Stanford University Consulting Associate Professor who has been practicing and teaching entrepreneurship for about 30 years. In fact, Mike has been involved with entrepreneurship education at Aalto University for a number of years now.
“Yes it does,” he declares. “Product development groups within companies frequently perform at much higher levels if they are treated as entrepreneurial start-ups within that company. Managers are recognizing that entrepreneurship is a mechanism to improve economic performance and quality of life within organizations and within regions. Entrepreneurship is a way for individuals to figure out how to add value to society and create new categories of work. New products and services tend to come out of an entrepreneurial approach.”
This is why Mike is a strong advocate for entrepreneurship education for anyone involved in management, whether in a larger organization or in a startup. “Entrepreneurship is becoming more important today because the innovation that entrepreneurship has created is changing the work landscape. In some instances it has made worker efficiency much higher. It is essential for companies to stay competitive in the global economy. ”
What is an entrepreneur?
So what is an entrepreneur, especially in a larger organizational context? Mike likes this description offered by Professor Howard Stevenson at Harvard: an entrepreneur is a person who pursues an opportunity without regard to resources controlled. This, as Mike explains, differentiates entrepreneurs from other staff in organizations: “The first question in-house corporate folks ask when they are told to take on a new project is, ‘Okay, what’s my budget?’ An entrepreneur doesn’t think like that. An entrepreneur’s response to that question would be, ‘I don’t care what the budget is, I’ll just go figure out what it takes to do this and then I’ll go find the resources to make it work.’ Entrepreneurs are very resource constrained, so they have to decide what is the most important thing to do with the limited funds they have.”
Clay Christensen’s book The Innovator’s Dilemma identifies a common challenge facing entrepreneurial people: they often conflict with the dominant culture and practices within organizations. Mike agrees. “The thesis in that book is that innovation often doesn’t happen in large companies because innovation is in fundamental conflict with the business model of that corporation,” he states. “Innovative behavior frequently triggers immune systems in organizations. Anytime an innovator attempts to interfere with an existing business model, management puts a stop to it.”
Entrepreneurship training is important
This is why, according to Mike, entrepreneurship education is so important: “Entrepreneurship courses and education programs teach people how to deal with problems like that and to expect these problems so that they are not a complete surprise when they come. It also teaches them a level of toughness that they are going to need to succeed.”
Mike is adamant that mental toughness is one of the most vital characteristics of entrepreneurs. “Whenever there is a new idea, people are always going to tell the entrepreneur that it’s never going to work. Entrepreneurs have to be very tough mentally, because so many people will tell them they are doing it wrong. Look at how many people told Jeff Bezos that Amazon wasn’t going to work! And they are still telling him that!”
Aalto University Executive Education is about to introduce entrepreneurship education to its MBA program during fall 2013. To be launched with Aalto EE’s New Venture Workshop course, entrepreneurship topics in the executive education program include Entrepreneurial Finance and Managing Growing Enterprises & Corporate Entrepreneurship. Several world-class experts such as Mike Lyons from Stanford University will contribute to the program’s entrepreneurship curriculum.