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Entrepreneurial Climate Analysis

Published March 8, 2013 by Mayrbear's Lair

Entrepreneurial Climate Analysis

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Introduction

We are in the midst of a global entrepreneurial revolution in every nation, industry and market.  According to Morris, et al. (2011) startups are at an all-time high with new products and services also at record levels in most industries (Morris, Kuratko, & Covin, 2011). In the meantime many of these new startups fail as quickly as they emerge. In order for a venture to have the best chance of survival experts concur that an analysis of the culture, climate and environment of an entrepreneurial organization is required in creating a successful establishment.

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Environment

To create a successful entrepreneurial environment an individual needs to identify opportunities and generate new growth (Hisrich & Kearney, 2012). An analysis of the following components can help ascertain whether a venture is worth considering: (a) the technology incorporated; (b) the ability to nurture new ideas; (c) the establishment of systems and strategies to cope with failure; (d) the determination, accessibility and availability of resources; and (e) the channels available that support management. For example, challenges from high unemployment rates, sparked new ideas for some individuals to seek innovative employment solutions. For one individual, the joblessness condition presented an opportunity to employ their media production experience to provide social media services specifically targeted at corporate executives and businesses. To create a constructive entrepreneurial environment, conducting a critical organizational assessment can help foster solutions that harness support including access to additional resources. In the meantime armed with a positive attitude, their organization continues to grow with an openness that incorporates new innovations and technologies to encourage creativity in addition to the support from cohesive plans and strategies.

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Climate

An entrepreneurial climate must adhere to innovation and change. For example, the culture of virtual organizations is really taking off and has transformed the work place. Virtual mediums enable leaders to accept, expect, and encourage innovations that include the staff in the co-creation process, make adjustments and adaptations based on user feedback, and coalesce from remote locations.  Badal (2013) postulates that to create a successful environment, leaders should be: (a) driven; (b) display effective communication skills; (c) are able to motivate and inspire others; (d) can identify strengths and weaknesses in themselves as well as others; and (e) turn challenges into opportunities  (Badal, 2013). An essential component to success in an evolving a young start-up organization is creating an entrepreneurial climate that implements a daily ritual that can include for instance, various exercises to strengthen the body, mind, and spirit. It is important to focus intention and attention on self-disciplinary actions to achieve and maintain an effective leadership role, especially in the early stages where a venture consists of very few individuals to motivate each other. This disciplinary component nurtures individuality, confidence, and provides stamina that drives the internal engines to achieve success.

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Culture

Corporate entrepreneurs are mavericks, innovators, and the pioneers that spark new enterprises, products, and services by developing, growing and designing a culture that incorporates strategies, structure and policies that support their ventures (Hisrich & Kearney, 2012). When creating an entrepreneurial culture, leaders assess the following components: (a) the technologies available required to operate effectively;  (b) the fluctuation in cost of goods, exchange rates, interest rates, tax incentives and a price for services; (c) marketplace competition; (d) labor force requirements; (e) resource availability; (f) who the target market and customers are; (g) an understanding of law, restrictions and regulations for operation; (h) and the global environment that includes real-time communication, productivity, distributors, suppliers and other strategic alliances (Morris, Kuratko, & Covin, 2011). In the early stages of an operation, nurturing a creative culture environment that utilizes state of the art technology in a cost effective manner is a good strategy to keep costs down for a new start-up. For example, one young organization decided to employ an innovative strategy to upgrade their Adobe Creative Suite software to remain a contender in the competitive marketplace. The organization saved thousands of dollars by joining the Adobe Cloud group that offers professionals the use of the latest versions of Adobe’s creative design programs from remote locations at a low monthly rate. This is a strategic, cost effective decision, that supports production creativity and levels the playing field against competitors with access to more resources.

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Conclusion

Without analysis and support in their venture, entrepreneurs can give up and quit. In addition, visionary leaders who recognize talented corporate entrepreneurs can help their company benefit further by facilitating a platform that nurtures creativity and new innovations that includes a comprehensive business plan to optimize chances of success and help manage internal politics (Hisrich & Kearney, 2012). In conclusion, an analysis of the culture, climate and environment of an entrepreneurial organization is essential for creating a successful business establishment.

References

Badal, S. (2013). Building corporate entrepreneurship is hard work. Retrieved February 13, 2013, from Gallup Business Journal: http://businessjournal.gallup.com/content/157604/building-corporate-entrepreneurship-hard-work.aspx

Hisrich, R., & Kearney, C. (2012). Corporate entrepreneurship: How to create a thriving entrepreneurial spirit throughout your company. New York, NY: McGraw-Hill Publishing.

Morris, M., Kuratko, D., & Covin, J. (2011). Corporate entrepreneurship and innovation (3rd ed.). Mason, OH: South-Western College Publishing.

The Entrepreneurial Culture

Published February 27, 2013 by Mayrbear's Lair

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Research reveals that more and more companies are embracing an entrepreneurial culture in the innovation process within their organizations. Firms have begun to comprehend that the nature of innovation is transforming the workplace and have developed policies to accommodate this paradigm shift.  The field of innovation now expands beyond the traditional arenas of science and technology.  Organizations have done this by instigating innovation in ways that also address new components to include: 1) co-creation, 2) user involvement, and 3) environmental and social challenges (Prahalad, 2010). The Lego Corporation, for example has emerged as a company that incorporates a visible entrepreneurial culture.

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In 2006, innovators at Lego decided to involve users in the early stages of the development process for the next generation of a popular product called Mindstorms.  They picked four advanced users from an online community to help develop new features. This strategic union between users and non-users from the in-house production staff turned out to be quite successful and a contribution to Lego’s culture toward a better organizational experience. The experience and insight users offered were a valuable asset for the engineers who could now develop a new product directly with the feedback of the operators. It was so successful, they eventually became a part of the Lego Innovation team and the new version of Mindstorms NXT went on to garner two achievement awards within the first few months of its release. MacDonald (2008) purports that working for a huge corporation can hinder productivity due to the bureaucratic nature.  In other words there is less freedom to engage in creativity that can help individuals fully realize their potential (MacDonald, 2008, pp. 4-6). The Lego corporation has found a way to break some of these bureaucratic barriers by incorporating innovative entrepreneurial techniques.

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Economic crisis and high unemployment rates forced some out of the world of bureaumania and into the world of entrepreneurship. It forced some individuals to find solutions outside the box for employment. For example, one person began offering marketing and social media production services to a select corporate executives as an independent contractor.  The venture is still in the infancy stages as they continue to learn from their experiences and work out the bugs from the structures that hinder the process which include the expansion of a client base and the resources to support it. Badal (2013) suggests that creating the right environment which includes: (a) being open to risk, (b) developing trusting relationships, (c) building skills and knowledge, (d) offering support, (e) obtaining access to resources, (f) maintaining a supportive organizational structure, and (g) setting realistic goals, is pivotal for the innovation process that is emerging in the entrepreneurial sector (Badal, 2013).

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References:

Badal, S. (2013). Building corporate entrepreneurship is hard work. Retrieved February 13, 2013, from Gallup Business Journal: http://businessjournal.gallup.com/content/157604/building-corporate-entrepreneurship-hard-work.aspx

MacDonald, R. (2008). Beat the system: 11 secrets to building an entrepreneurial culture in a bureaucratic world. Hoboken, NJ: John Wiley & Sons, Inc.

Prahalad, C. K. (2010). The new nature of innovation. Ann Arbor, MI: OECD.