Entrepreneurship and Entrepreneurial Culture

 Entrepreneurial culture can be made to enable democratization of the capacity to create and manage (business) towards wealth creation, thereby eradicating poverty.

When people are empowered to create and manage their own businesses,

•     wealth creation is possible;
•     jobs are created;
•     individual and collective well being becomes a reality; and
•     it becomes easier for the State to better redistribute wealth to those who cannot work (disabilities for instance) when all those who can work are empowered to do so.

Earlier definitions of entrepreneurship have referred to creation and running of innovative businesses by people sharing a number of characteristics. Broadly speaking, entrepreneurship also includes innovative positive social interventions (to be dealt with under Social Entrepreneurship in a later Unit).

Culture refers to attitudes and values which in the case of entrepreneurship may be linked with autonomy, creativity and sense of responsibility (soft skills) and so on. It also refers to entrepreneurial knowledge and skills and management competencies which have to be acquired (hard skills).

The hard aspects of culture apply to entrepreneurship because without them, an entrepreneurial culture would not develop into a tangible act.

According to David Mc Clelland (1961), an entrepreneur is a dynamic person who takes calculated risks. This definition has a behaviorist orientation.

Fillion (1990) defines the entrepreneur as someone who imagines, develops and realizes a vision. In economic terms, one may define an entrepreneur as someone who combines resources in such a way as to add value.

A psychologist’s point of view may be that: an entrepreneur is someone who feels the need to accomplish something, to realize his/her potential or to become his own boss.

Across all above definitions, there is a recurrence of underlying notions like: vision, value creation, innovation, risk-taking and self-accomplishment.

Having reviewed the characteristics of entrepreneurs, one is tempted to conclude that an entrepreneur is a product of his/her particular environment. Several authors have shown that entrepreneurs reflect the characteristics of the time and place where they have evolved (Toulouse, 1990). The cultures, the needs and the habits of a particular country or region shape the behaviour of entrepreneurs. Obviously enough, with the falling of frontiers (both geographical and psychological) entrepreneurs exert an influence that goes far beyond their own countries and/or regions.


Entrepreneurial Culture

Culture can be defined as the mix of norms, values and beliefs that are shared by a particular community [be it a business community, a cultural (or ethnic) community, a country, or a geographical region].


Cultural Values

Linton (1975) describes values as a predisposition to act in a certain way.

Values of entrepreneurs:
According to Sexton & Bowman (1986), entrepreneurship is a value in itself for Americans. Different authors suggest different values for entrepreneurs:

Kets de Vries (1984): reputation, power, status and recognition
Gordon Survey of values (1976): independence, efficacy and a negative reaction to affiliation.

There is a general presumption that a society may have potential entrepreneurs, but only becomes entrepreneurial if it has a culture that supports innovation and initiative.

Cultural Attitudes

According to J. M. Toulouse (1990), entrepreneurial culture is favoured by the following set of attitudes:
1. Business activities are valued.
2. Individual and collective initiatives are highly rated.
3. Determination and perseverance are desirable qualities.
4. An equilibrium between security and risk is accepted.
5. The tension between stability and change is resolved.

Therefore, in a society favoring entrepreneurship, entrepreneurs are role models who are not only acceptable, but desirable.

Learning Activity 1

In such societies, challenges are regarded as opportunities (and not threats). In societies where entrepreneurship is absent, business challenges are left to be taken care of by foreign investors. On the other hand, within entrepreneurial cultures, people will find inspiration in challenges. These will enable them to act and find ways to exploit existing opportunities. An example of lack of entrepreneurial culture in a given country is where the business community believes that government is going to take charge of all their problems.

An entrepreneurial culture is supported by people who have a strong belief in their projects, who will invest their physical, psychological and other resources (also including those of others!) in their venture with a view to succeed.

Decision is taken out of reasonable certainty and out of a positive balance of probabilities based on available information. A community favoring experimentation, R & D and innovation, has a culture associated with risk taking. Entrepreneurship reconciles risk and security.

Starting a small business entails risks, but is also a source of gratification for the successful entrepreneurs.

Entrepreneurship has the potential to bring positive changes, both to the individual or collective entrepreneur and to society as a whole. Entrepreneurs are change agents who can alter a given situation and give society a product or service that can transform their behaviors and ways of living.

Hence, a society that favors status-quo and offers resistance to change does not display a culture conducive to entrepreneurship.

Similarly, a business organization that resists change will ultimately have to face its own obsolescence.

According to Fortin (2003), entrepreneurial culture can be rooted in a society through four main avenues:
- the family;
- education;
- existing business organization; and
- local and national authorities and leaders.

Promoting an Entrepreneurial Culture within the Community

The conditions required for establishing an Entrepreneurial Culture are:

Identification and promotion of Role Models: Women entrepreneurs, for example the ladies who lost their jobs in the textile sector and created ‘Charmin Sud’, a rural women entrepreneur partnership. They came on television to explain how being laid off from an ailing textile industry was for them a blessing in disguise. It allowed them to unveil their entrepreneurial potential and leadership abilities.

Role of media: For instance, in the promotion of Entrepreneurship as a business model. Until recently, the local TV ran a weekly documentary: ‘Portrait d’Elle’, in which a local women entrepreneur was portrayed as to her new place in society as an economic (and social) agent. Similarly, a few newspapers reserve a page regularly to promote entrepreneurial initiatives.

The Education system: Entrepreneurship modules in the curriculum at different levels. Entrepreneurship education is now beginning to be anchored in tertiary education curricula. We have now moved past the old paradigm whereby entrepreneurship was to be taught only in Business faculties. The present Super GEM is a living example of the new paradigm whereby the subject is available to all undergraduates from all fields. An IT student, a Fashion & Design student and all the others in fact, need to know the basic business and entrepreneurship skills that are required to start a business or to act entrepreneurially, to lead and innovate in their employer organizations.

Period of Incubation: Entrepreneurship development programmes spread over a period of time (and not one off initiatives). Initiatives like “La semaine de l’Entrepreneuriat” are beneficial for general awareness, but the enthusiasm soon dies away after the caravan has left. What is truly beneficial for culture change is a planned process that uses all the avenues mentioned in this section over a longer period with set objectives and performance targets. In Finland, entrepreneurship and entrepreneurial culture developed as a result of a planned ‘Entrepreneurship decade’, that is, ten years of cultural change. This can take the form of entrepreneurship education starting at primary or secondary education level, targeting rural women with a Microcredit scheme and so on.

Participation of leaders (political, business, opinion): Political and religious leaders to promote entrepreneurship as a solution to current economic problems. As mentioned earlier under ‘leadership’, a strong, charismatic leadership is required to transform a community. To change the mentality from ‘qualifying to get a government job’ to ‘taking charge of oneself by being self employed’ requires psychological ‘push’ that can be facilitated by people who can influence the community. The first people to come to our mind are the political, social and religious leaders.

Creating and Mantaining an Entrepreneurial Culture

Culture is a hot buzzword among corporate and entrepreneurial companies alike. It's what everyone is striving for, what brings on the loyalty, what attracts and keeps the really awesome employees.

If done right, it seems so simple. Good corporate culture, in its purest sense, and at its most successful, has the look and feel of something organic and uncontrived, something that just exists. But alas, there's the rub, and at once the wonderful twist: Corporate culture cannot, does not and never will exist "just because." Culture is a balancing act between many elements of a company and requires careful execution at each level.

This is especially true for entrepreneurial companies, where what's going on is the building of a business as well as a culture. Corporate culture must be led, nurtured, constantly monitored and adjusted. Much like a "culture" in a petri dish, it requires that you combine the right ingredients, in the right way, to ensure that what you grow is not an aberration of your intentions.
Laying the Groundwork

When I founded Net Daemons, my computer consulting company, I had very definite ideas of what I wanted to provide for our future employees, a safe and comfortable environment, which enabled people to learn, grow and, at the same time, focus on their day-to-day work.

From early on, I felt it was important to treat every employee with trust and respect. That meant assuming automatically that each was an honest, hard-working, reliable and dependable individual. Rather than requiring all employees show up at nine and leave at five, for example, I expected each person to do the job assigned, and to apply the right amount of time and quality of skills toward the accomplishment of each task.

While I wasn't aware, back then, that I was creating what is now considered "corporate culture," I knew I was looking to create a place of employment where employees were at once valued for who they were and what they brought to the table. This was critical for our business, which sold knowledge and a system of collaboration between some 45 engineers providing network-administration and internet-development solutions. If a team isn't in sync, you can't sell a team approach, and you're no better than the single consultant.
What Makes a Culture Entrepreneurial?

As one of our engineers once put it, in an entrepreneurial culture, work is more than a job, it's a lifestyle. Employees are more like a team than in most companies, and in some cases, we're even like a family.

What also evolved was a set of rules for creating and maintaining NDA's petri dish. In creating your own, consider these rules:

•     Treat people with respect. This is a very simple premise, which threads through each and every complicated issue that can arise within a company. Respect and trust provide the necessary base for a vibrant and sustainable corporate culture.

•     Help employees stay healthy. When employees get sick, they miss work, so it makes sense to offer health insurance as a benefit. We covered 100% of employee health plans. I never want an employee to experience a catastrophic illness and not be covered by insurance. We also offered unlimited sick time. While I had seen this type of policy backfire elsewhere, it nonetheless allowed people to be sick when they really were sick, and not feel obligated to gobble up each "allotted" sick day. You may also want to add a wellness allowance for health-club membership.

•     Open doors to communication. Create an environment where people can interact with each other, support each other and recognize each others efforts and achievements. Provide positive rewards for positive behavior. Share information, so that employees are aware of the direction of the company and are involved in it. Use all-hands meetings for financial and operational information, team-building and social events. Offer incentive programs to reward effort and improve quality of life.

•     Build camaraderie. Make time for people to get to know each other and the company. We held an annual off-site meeting to build team spirit and discuss where the company was going. At such events you can also distribute and share your business plan and discuss issues and ideas raised by your strategies.

Maintaining Entrepreneurial Culture

Once you have healthy, trusted and informed employees, don't let the culture that's evolving just be. It needs to be watched so that it grows as you intended. The trick is standing back, but not too far back. In maintaining your culture, consider these rules.

•     Let the team build itself. Within that safe, comfortable, open environment, let employees grow together without being made to.

•     Participate without controlling. Let the culture thrive, without your either meddling with it or ignoring it.

•     Don't forget the little things. Culture is made up of many small actions that, when put together, create something larger than the sum of the parts. There are many things a CEO can do to make employees feel a part of the company. Some are just common courtesies: hallway conversations, saying "hello" in the morning, opening doors, asking after people's families and partners. Others are little extras, such as flowers to say thank you and happy-birthday e-mail messages. Eating lunch with employees, helping spouses find jobs and participating in team events show that you, the CEO, are involved with your employees.

Treating employees with respect helps enable them to do their jobs to the best of their abilities. If you challenge people to raise their bars, provide fun activities, keep people informed and humanize your management, you get culture. From these basics, you will grow in your petri dish a strong, healthy culture that will allow you, your company and your employees to flourish.


   By Jennifer Lawton, Owner, Just Books, Inc.