The Battle for Leadership: Entrepreneurs vs. Managers
BUSINESS INTELLECT
ENTREPRENEURIAL CHALLENGE
Jaroslav Kaplan
President of the Kaplan Research Company
Founder of the Business IQ project
President of Kaplan Research Company, author of the book "Business INCOGNITA: How to Expand the Boundaries of Entrepreneurial Thinking".
ENTREPRENEURIAL CHALLENGE
Jaroslav Kaplan
President of the Kaplan Research Company
Founder of the Business IQ project
President of Kaplan Research Company, author of the book "Business INCOGNITA: How to Expand the Boundaries of Entrepreneurial Thinking".
Entrepreneur or manager - two roles in business, whose interests often confront one another. What difference in priorities causes this struggle, and what consequences come of it?
Roles, functions and resources
The entrepreneur is more likely than the manager to have the ability to see opportunities in the market, in new market situations, to take risks and turn these opportunities into real market gains. A manager is a manager or a hired executive who is responsible for the organization and stable operation of a company. The tasks of the latter include planning, making operational decisions, controlling and coordinating the work of employees. Unlike entrepreneurs, managers are more often oriented not outward, to the market, but "inside" the organization, to the efficiency and stability of the entire system of activities.
One of the best definitions of entrepreneurship as "the search for opportunities beyond controlled resources" belongs to Howard Stevenson, a professor at Harvard Business School. Following this logic, he very clearly divided the two roles: people are either entrepreneurs or managers, depending on the focus on controlled or uncontrolled resources. A person who is focused on making use of resources located within the organization is a manager. If, in his development he relies on new resources and opportunities outside the company, he is an entrepreneur.
It is obvious that in calm and predictable times managers can easily take business matters into their own hands. This is because in such conditions, structured tactics like schedules, plans, agreements, rules, etc. work well. During the "storm," on the other hand, they quickly realize that their tools do not work as well as before, or even fail. This is where entrepreneurs come to the fore, whose main goal is to find and create new market opportunities, resources and innovative ideas for business development.
Setting goals and objectives
Another fundamental difference between an entrepreneur and a manager is who defines the goals and vectors of their activities. For example, for a manager to be able to use available resources efficiently, he needs to understand what this means in practice, i.e. he needs clearly defined goals, which will define for him a whole set of criteria for evaluating such efficiency. This begs the question of where he will get such goals from. They are usually determined by the business owner, a superior manager, or they are spelled out in the company's internal corporate policy. A manager has many ways to get goals for his activity and precise requirements for his efficiency, but he most often cannot set them himself.
The situation is different for an entrepreneur. He defines his own goals, ways to achieve them, takes risks and bears responsibility for the decisions made. While this may not be an easy choice, fortunately or unfortunately, no one else can make it for him.
Being in the same business ecosystem, entrepreneurs and managers not only have different perspectives on the same problems, utilize working methods and tools, but often even skills and abilities. For example, an entrepreneur with well-developed business Intellect can see potential where others simply do not see it, and create new and unique combinations of resources that allow him to realize his vision. The manager, on the other hand, is focused on optimizing and effectively managing the assets already at his disposal. Therein lies the main reason for the conflict between the two. Entrepreneurs seek growth and development by recognizing new market opportunities, often outside their organizations, while managers ensure the stability and predictable outcome of the company through the efficient use of the resources they control.
Working in the age of changes
The modern market is constantly changing, technologies are developing and new opportunities are emerging. And often business success depends on the ability to perceive and recognize these changes, because they are not "on a silver platter". It is not easy to see a specific opportunity in the flux of data, phenomena and events around us and correctly assess its future potential.
Unlike a manager, an entrepreneur is constantly busy "researching" his field of activity, looking for fundamentally new clients, products, markets, etc. He is like a builder, who, looking at a pile of stones, can see in it both a "pile of garbage" and valuable building material. If an entrepreneur does not take an active interest in the environment, make attempts to study and explore it, he risks missing an opportunity and failing to see a promising billion-dollar business idea. Ironically, entrepreneurs rarely consider this kind of activity as market research.
Often we see active confrontation between entrepreneurs and managers, which manifests itself in many different areas of work. For example, entrepreneurs may challenge managers' operational decisions or their tight control over budgets, leaving operational space for test sales and experimentation. In turn, managers may perceive entrepreneurial initiative without proper justification and planning as rash and risky.
Struggles of interest between entrepreneurs and managers are an integral part of business. Despite the difference in gait, the two roles are interrelated and can complement each other. For the same business problems, entrepreneurs will generate some hypothesis-solutions, while managers will generate completely different ones. In some cases, the former will be more effective, while in other cases the latter will be the winners. At the same time, entrepreneurs can achieve greater stability and structure in their projects through cooperation with managers, while the latter can receive from them a wide range of proposals and ideas for innovation.
The entrepreneur is more likely than the manager to have the ability to see opportunities in the market, in new market situations, to take risks and turn these opportunities into real market gains. A manager is a manager or a hired executive who is responsible for the organization and stable operation of a company. The tasks of the latter include planning, making operational decisions, controlling and coordinating the work of employees. Unlike entrepreneurs, managers are more often oriented not outward, to the market, but "inside" the organization, to the efficiency and stability of the entire system of activities.
One of the best definitions of entrepreneurship as "the search for opportunities beyond controlled resources" belongs to Howard Stevenson, a professor at Harvard Business School. Following this logic, he very clearly divided the two roles: people are either entrepreneurs or managers, depending on the focus on controlled or uncontrolled resources. A person who is focused on making use of resources located within the organization is a manager. If, in his development he relies on new resources and opportunities outside the company, he is an entrepreneur.
It is obvious that in calm and predictable times managers can easily take business matters into their own hands. This is because in such conditions, structured tactics like schedules, plans, agreements, rules, etc. work well. During the "storm," on the other hand, they quickly realize that their tools do not work as well as before, or even fail. This is where entrepreneurs come to the fore, whose main goal is to find and create new market opportunities, resources and innovative ideas for business development.
Setting goals and objectives
Another fundamental difference between an entrepreneur and a manager is who defines the goals and vectors of their activities. For example, for a manager to be able to use available resources efficiently, he needs to understand what this means in practice, i.e. he needs clearly defined goals, which will define for him a whole set of criteria for evaluating such efficiency. This begs the question of where he will get such goals from. They are usually determined by the business owner, a superior manager, or they are spelled out in the company's internal corporate policy. A manager has many ways to get goals for his activity and precise requirements for his efficiency, but he most often cannot set them himself.
The situation is different for an entrepreneur. He defines his own goals, ways to achieve them, takes risks and bears responsibility for the decisions made. While this may not be an easy choice, fortunately or unfortunately, no one else can make it for him.
Being in the same business ecosystem, entrepreneurs and managers not only have different perspectives on the same problems, utilize working methods and tools, but often even skills and abilities. For example, an entrepreneur with well-developed business Intellect can see potential where others simply do not see it, and create new and unique combinations of resources that allow him to realize his vision. The manager, on the other hand, is focused on optimizing and effectively managing the assets already at his disposal. Therein lies the main reason for the conflict between the two. Entrepreneurs seek growth and development by recognizing new market opportunities, often outside their organizations, while managers ensure the stability and predictable outcome of the company through the efficient use of the resources they control.
Working in the age of changes
The modern market is constantly changing, technologies are developing and new opportunities are emerging. And often business success depends on the ability to perceive and recognize these changes, because they are not "on a silver platter". It is not easy to see a specific opportunity in the flux of data, phenomena and events around us and correctly assess its future potential.
Unlike a manager, an entrepreneur is constantly busy "researching" his field of activity, looking for fundamentally new clients, products, markets, etc. He is like a builder, who, looking at a pile of stones, can see in it both a "pile of garbage" and valuable building material. If an entrepreneur does not take an active interest in the environment, make attempts to study and explore it, he risks missing an opportunity and failing to see a promising billion-dollar business idea. Ironically, entrepreneurs rarely consider this kind of activity as market research.
Often we see active confrontation between entrepreneurs and managers, which manifests itself in many different areas of work. For example, entrepreneurs may challenge managers' operational decisions or their tight control over budgets, leaving operational space for test sales and experimentation. In turn, managers may perceive entrepreneurial initiative without proper justification and planning as rash and risky.
Struggles of interest between entrepreneurs and managers are an integral part of business. Despite the difference in gait, the two roles are interrelated and can complement each other. For the same business problems, entrepreneurs will generate some hypothesis-solutions, while managers will generate completely different ones. In some cases, the former will be more effective, while in other cases the latter will be the winners. At the same time, entrepreneurs can achieve greater stability and structure in their projects through cooperation with managers, while the latter can receive from them a wide range of proposals and ideas for innovation.
Jaroslav Kaplan
Author of the book "Business Incognita. How to push the boundaries of entrepreneurial thinking". Expert in the field of sustainable development of organizations and discovering new sources of growth. Developer of the methodology of contextual market research. Member of the International Association of Strategic and Competitive Intellect Professionals SCIP (USA).
Blog: https://www.kaplanresearch.pro/eng
In this light (yet profound) business fable a very magical and sincerely nice goldfish, Goshio, navigates her aquarium and the seas of the Paraquarian world beyond. The heroine's journey is an allegory of the entrepreneurial world (and of life) – based on the author's own research journey to circumnavigate the fascinating World of Entrepreneurship. www.goshio.com
Contact:
E-mail: work@kaplan4research.com
Linkedin: www.linkedin.com/in/jaroslavs-kaplans-11255b
Author of the book "Business Incognita. How to push the boundaries of entrepreneurial thinking". Expert in the field of sustainable development of organizations and discovering new sources of growth. Developer of the methodology of contextual market research. Member of the International Association of Strategic and Competitive Intellect Professionals SCIP (USA).
Blog: https://www.kaplanresearch.pro/eng
In this light (yet profound) business fable a very magical and sincerely nice goldfish, Goshio, navigates her aquarium and the seas of the Paraquarian world beyond. The heroine's journey is an allegory of the entrepreneurial world (and of life) – based on the author's own research journey to circumnavigate the fascinating World of Entrepreneurship. www.goshio.com
Contact:
E-mail: work@kaplan4research.com
Linkedin: www.linkedin.com/in/jaroslavs-kaplans-11255b
