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Thursday, May 30, 2013

The Development of Collaborative Entrepreneurship in Organizations


Entrepreneurship comes in many forms, methods, and pathways. Most often it is discussed in terms of small business development but also includes important aspects of developing stronger products, services, and proactive problem-solving. Research conducted on a Finnish consulting firm helps to highlight how internal organizational entrepreneurship can exist within the team framework of the organizations leaders. It is this leadership inclusion and culture of discussion that can turn reactive management into proactive problem-solving that improves performance. 

Entrepreneurship within organizations should be honored and encouraged to foster stronger performing companies. The main task of organizational entrepreneurship is to improve economic performance through better developed strategies and operations (Rauch, et. al., 2009; Ireland, Covin & Kuratko, 2009). Such activities encourage innovative development of both the decision-makers processes as well as the operational structures they control. 

A large percentage of organizational performance is based within the capacity and behavioral patterns of the leadership team. It is this leadership team that develops the processes and procedures by which other organizational aspects function. These processes and procedures create a structure that primes employee’s behavior through the rewards, punishments, expectations, communication lines, and processes. Enhancing the entrepreneurship of the leadership team has a huge impact on the functioning of the rest of the organization. 

Since leader’s decisions are important and have a wide impact on the organization it is beneficial to create checks and balances by offering as many possible solutions and counter solutions as relevancy allows. Some have advocated a four step process of joint decision-making that includes proposal, access, agreement and commitment (Stevanovic, 2012). As proposals make their way into the leadership war room they should be fairly pondered, accepted or discarded, and finally committed upon. 

A study conducted by Peltola from the University of Helsinki helps to further define how entrepreneurship and decision-making innovation works within executive teams (2013). The study offers a case study of a consultative business management organization with access to a number of other firms in Finland. Meetings were recorded to determine overall effectiveness of practices. 

Results:

-Collaborative decision-making practices to solve jointly-acknowledged performance problems are important at the initial stages of entrepreneurship. 

- Entrepreneurship in decision making is founded on proposals, access, agreement and commitment. 

-Strong decision-making processes require conversational subtlety. 

-Powerful members must first adapt and model entrepreneurship traits for others.

Business Analysis:

The development of an entrepreneurial culture starts at the very top of an organization. Those leaders who adapt and model the stages will encourage others to come forward with solutions. The stages depend on a proposal, access to decision makers, agreement about fundamental issues and approaches, and finally commitment to enact the proposal. The successful solicitation and presentation of proposals requires the ability to engage in productive conversation versus the subtle rejection of anything new. Organizations that desire to stay ahead of problems need to be open to potential solutions and accepting of those solutions for debate. 

Ireland, R.D., Covin, J.G., Kuratko, D.F., (2009). Conceptualizing Corporate Entrepreneurship Strategy. Entrepreneurship Theory and Practice, 33(1).

Peltola, S. (2013). The emergence of entrepreneurship in organizations: joint decision-making about new sales practices in management group meeting interaction. Poznan University of Economics Review, 13 (1).

Rauch, A., Wiklund, J., Lumpkin, G.T., Frese, M., (2009) Entrepreneurial Orientation and Business Performance: An Assessment of Past Research and Suggestions for the Future. Entrepreneurship Theory and Practice, 33(3).

Stevanovic, M., (2012) Establishing Joint Decisions in a Dyad. Discourse Studies, 14 (6).

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