Building an entrepreneurial organization

Issue Number: 
343
Author: 
Dr. Nagendra P. Singh
Published: 
2001-10-30


Many people would like to start their own business, but few are able to make this dream a reality. Developing an organization is tough; you have to be able to make things happen and you need a sense of sacrifice and commitment to your mission. I have learned a great deal about what it takes to build an organization from others’ success stories, but perhaps, to be honest, even more from my own mistakes.

The person who leads an organization is the "organization builder." Launching a new project, brand or idea requires one set of skills, but the day-to-day managing of an organization calls for an entirely different kind of stamina. Organization builders learn from the past but are also visionaries, creating the mindset necessary for the organization to work toward its goal. They have a strong sense of social responsibility, seeing the organization’s goal as an integral part of the larger interest of society as well. Organization builders bring out the best in their employees, delegating responsibility and giving them the freedom to perform. Finally, they are able to overcome fear, making trust and cooperation their organizations’ guiding principles.

Learning from the past:

Experience shows that the bureaucratic and feudalistic style of leadership often practiced in Russian organizations, due to the Soviet influence, actually has little in common with the country’s cultural history. In fact, the Russian people are open and supportive by nature. Therefore, in the shift to keep up with emerging requirements and global opportunities, which demands new strategies and a creative, vibrant outlook, Russian leaders should not just take advantage of these natural traits in their staff, but also be more open themselves.



Creating a new mindset:

When building an organization, a positive mindset is more important than the amount of available resources. Resources come and go, but often we are too myopic to see and value what we really have. Being an entrepreneurial leader and launching a new organization require the tenacity and vigor to create this positive, flexible mindset.

Having a flexible attitude allows an organization to look within itself and readjust to social and market demands. In Russia it is often assumed that initiatives for change invariably come from the top and that organizations with a strong history of government patronage and support are prone to be bureaucratic and feudal in their operations. But an organization with a more flexible approach allows change to come from the group level, even if calls for change put pressure on top management and lead to structural reforms. An organization builder nurtures responsiveness to flexibility and change and avoids trying to keep the lid on these forces.

Contrary to what many believe, an organization is not simply acted on by market forces that compel it to adapt. Adaptation does not take place naturally unless people within the organization are aware of the new forces and feel empowered to respond to them.

Doing vs. making others do

All too often organization builders make the mistake of trying to do everything, becoming responsible for everyone’s performance. In truth, the chief executive's role is to make others perform. One of my acquaintances played such a large role in decision-making at his organization that it simply collapsed when he left. His single-handed approach was effective at delivering results, but the team as a whole was not as competent and experienced as it should have been. Employees had learned not to innovate or take risks but to rely in all situations on their leader. An organization builder must be able to delegate and empower juniors, enabling them to create effective work systems, acting as coach rather than star player.

Openness, transparency and a supportive orientation on the part of the chief executive will create a sense of belonging and strong performance motivation among employees.

Confronting fear and distrust

Letting go and trusting employees to make decisions can be scary. Organization leaders are often enthusiastic and idealistic, and fear that employees will not be able to keep up with their boundless energy. Part of running a successful organization is learning to conquer this fear and foster trust and openness instead. It is truly a waste to develop an organization with a social objective and then not let anyone grow and develop. One person is enough to demolish an organization, but it takes many to build one.

Only by combining trust, the willingness to delegate and the flexibility to change can organization builders ensure that their personnel will be able to continue to meet the challenges they are confronted with. Many giant corporate houses and established family businesses of world repute are examples of the above hypothesis.

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