Saturday, 18 January 2014

The Dark Side Of Entrepreneurship: Some Further Thoughts

Have you ever witnessed the birth of a new baby and all the anxiety that comes with it?Have they told you of the many problems that a pregnant mother encounters during the nine months of the pregnancy?Admittedly no two pregnancies are the same;just as no two births are the same.Each has own its own story to tell;stories,bitter,sweet,bitter-sweet and sometimes sad.The story of entrepreneurship is not far from that of the birth of a baby.whereas,one is animate,the other is inanimate, but the pangs of a birth animate and inanimate remain the same.The journey into entrepreneurship is a giant leap of faith;a journey into the unknown and unchatted waters.Only the steely hearted can peer into the future without any certainty,but only by the say-so of a business plan and the faith of would be lenders and/or family members,friends risking their life savings to invest in an idea they perhaps know next to nothing about;without being told or personally aware of the dark side of entrepreneurship.The entrepreneur's beginning is one of sacrifice,going home without pay sometimes,at other times ploughing back the pay into the business;to sleepiness nights,the gnawing thoughts of failure,of debts that he may not be able to pay back;finally bankruptcy.
The route to entrepreneurship is varied and wide.We only have to be instructed in the literature on the subject to be informed of the varied routes taken by the likes of Bill Gates,Richard Branson,Steve Jobs,Jerry Kaplan,to mention just this few.


Jerry Kaplan,a serial entrepreneur in the computer industry and author of the book,"Start-up- a Silicon Valley Adventure",1995,states that the entrepreneur must embody the five concepts of entrepreneurship,for him to stand out.This he listed as leadership,team play,master of details,good managerial skills and communicator.

On leadership,it is submitted that the entrepreneur must lead in other to take the business to where it belongs,regardless of the staff may want it to be.He must be passionate and persuasive with his subordinates as to the future of the business.

Communication lies at the heart of the firm.The entrepreneur must be open and learn to communicate with his subordinates.While this may be simple when the firm is still small,the need to communicate becomes more acute as the enterprise grows.Formal communication channels will then need to be designed for the organization to function properly.Communicating the vision of the founder at the beginning tends to simplify the process of goal-setting and management of the business into the growth phase.It is also at this stage that an organizational culture is developed driven by the founder's vision for the enterprise.

Decision making has its time value.The right time determines the type of outcome one should expect.No where is this more exemplified than,for instance,when bringing a new product to the market or when change occurs in the market and the entrepreneur needs to react.He must be proactive in his decision making to reflect the dynamism of the market place.In other words,he must be marketing oriented in a strategic sense.

Team play has always been a big problem for the entrepreneur.The larger the ego,the worst it is.Team-play is particularly essential at the growth phase when talent and skills will be required to cope with the pressure that comes from expansion of the business.He needs to trust and not neat-pick subordinates.Being a leader requires the entrepreneur to trust them with tasks and responsibilities without breathing down their necks or always them to faulter for an excuse not to delegate some of his functions.

Telescoping is the ability to attend to details without getting lost in them;not losing sight of the big picture,namely strategy.Telescoping means understanding that every role however minute is as important as the big one.It is learning how to appreciate the small and the big in the organization,and that none is more important than the other.

Although authors like David Deakins,(1999), enunciated the entrepreneurial typology into three- socio-psychological,psychological and economic,much as the behavioral or psychological type has occupied much of the literature in recent times,given the high incidence of serial entrepreneurship,it is in the economic sphere that we have witnessed his impact more,as evidenced by the rapidity with which innovations that improve standards of living and lifestyles keep being churned out.

It is counter-intuitive to state that entrepreneurship and entrepreneurs create new products,new markets and in the process create economic opportunities through innovation.What accompanies these activities is uncertainty of whether your idea will succeed or not;side by side the unpredictability of things going according to the trajectory set forth by the business plan,assuming there is,one at the beginning of the journey.As any budding entrepreneur will tell you,uncertainty is a major element of any entrepreneurial endeavor,through creating wealth and improving society.Uncertainty is the entrepreneur's constant companion through out the early stages of the start-up's life.There is a curve in the learning of the entrepreneur from the many knocks and bruises he will receive along the way.But only steely resolve and constant faith he builds in the future keeps him going against all odds.

Wharton management professor,Ian Macmillan notes,"if you are going to do something that's really going to make a difference and its bold and highly innovative by definition,its also going to be highly uncertain". The entrepreneur is restless,a free spirit,a risk taker,a bucker of tradition,hates organizational structures,often loves to work outside them,not routinized to processes and procedures.He is the 'Man of Action"according to,Schumpeter in his characterization of the entrepreneur.In the womb of the restless,free spirit of the entrepreneur is also the recklessness of risk taking,which Manfred Kets de Vries describes in his article,The Darkside of Entrepreneurship,HBR,November-December,1985;as "acts of bias toward action which makes him act thoughtlessly,sometimes can have dire consequences" Derek du Toit,a business owner,notes,"the entrepreneur who starts his own business generally does so,because he is a difficult employee.He does not take kindly to,suggestions or orders from other people and aspires most of all to,run his own shop.His idiosyncrasies do not hurt anybody so long as the business is small,but once the business gets larger,requiring the support and active cooperation of more people,he is at risk".

The greatest risk to the entrepreneur at the head of a small business transmitting to a large is the loss of control to others in the organization,more specifically,professional managers who now run the business,sharing the decision making process with the entrepreneur.Hell hath no fury with the business owner who loses his absolute control over the decision making apparatus of an organization he solely founded and owns.Derek du Toit,states that the biggest problem a growing business faces is to have an entrepreneur founding,owning and leading it.Giving up control of the management of a growing company to professional managers is one of the down sides of entrepreneurship. The entrepreneurail process,briefly involves the identification and evaluation of opportunities,then development of a business plan,scouting of resources and finally managing the enterprise,day to day.Even though a fuller treatment of this process is beyond the scope of this note(for a fuller account see,'Enterpreurship',by Robert D. Hisrich;Michael P.Peters;and Dean A.Shepherd,2009;also see Entrepreneurship: Concepts,Theory and perspective.Introduction, by Alvaro Cuervo, Domingo Ribeiro2 y Salvador Roig,Universidad Complutense de Madrid 1,Universitat de Valencia 2 ),it is sufficient to note that the point of inflection in the entrepreneurial process is at the growth stage where the literature identifies most start-ups give up the ghost.65% of start-ups die at the growth stage within their first three years.

Joseph Kolobari,an entrepreneur of over two decades,with experience that cuts accross four industries(agricultural production,digital imaging,unit banking and security),notes that the principal reason start-ups fail is due to faulty planning.Acccording to Kolobari,"enterprises fail when they fail to plan,abnitio.In my over two decades in the small business arena,i have come accross numerous firms that merely took off from the starter block without planning the race,only to fail at the finish line".The finish line in this case is the growth stage when funds are critically needed for expansion,but are not easy to find.The rapidity with which innovative changes take place in an industry also hastens the demise;a typical example would be the IT industry industry where innovations are churned out with the rapidity of a clock.The speed of obsolescence in an industry vis a vis a firm's inability to respond quickly sounds the death toll,due to the dearth of working capital.Kolobari,further highlights organizational constraints wherein the entrepreneur,presiding over a rapidly growing firm refuses or fails to realise the need to delegate some of his hitherto functions and authority to colleagues for decision making. The entrepreneur fails to realise that the 'boy'has grown into a'man' and therefore needs to unlearn some of his behaviours towards the man.In other words,the entrepreneur must wean himself from running the show alone,moreso when professional managers have been brought in by him to help in lightening the load.Syndicating some of his functions and distributing the leadership of the growing organization leads to faster decision making and problem solving.At inception,he was a one man riot squad;now that the market has grown and the organization has equally grown in tandem,he too needs to grow as well.That is where the problem lies:the lack of the required mental shift by the entrepreneur which ocassions organizational inertia.The desire to be in absolute control leads him to distrust colleagues,and it is symtomatic of the mystification of the entrepreneur's role in wealth creation and desire to be the centre of the universe in the organization he founded,Kets de Vries (1985) suggested.How does the founder detach himself or herself from the organization and its professional managers and get it running on 'auto-pilot' of professionalism?This is the million dollar question in this debate about the dark side of entrepreneurship. Routinization we earlier identified to be one of the things that drives restlessness in budding entrepreneurs;so too is the feeling of anonymity,being a small speck in the giant wheel of the corporation,vis a vis the feeling of grandiosity.Resistance to change in the structure of the organization in conformity with changes in the business dynamics of the enterprise is a defense of those self same dark sides that propelled the entrepreneur to go seek his fortune and conquer the world. In the final analysis,the fear of failure and the odium it brings to the entrepreneur in the society, often propels him in directions that logically he shouldnt venture.Instead of the long-term,entrepreneurs look to the short term;cutting loose at the slightest opportunity and moving on to other things.Would this be reason why serial entrepreneurs proliferate?Or venture capitalists behave the way they do?Pulling out with their funds within the first five years.Are their actions behavioural,environmental or economic?These questions provide us the opportunity for further enquiry into some of the factors that spur the personality quicks of the entrepreneur.

SUMMARY. The compartmentalization of the study of entrepreneurship into economic,behavioural and managerial roles of the entrepreneur leads us to ask the question in our summation,whether to see him as an entrepreneur,a manager or capitalist.Or can he fit into all roles at once?There is also the issue of the dichotomy between what is and what ought to be about his role in society in terms of wealth creation,employment generation and higher productivity through innovations,the dark side of his endeavour fails to help us fill the deep hole in the normative question that our assumption seeks to answer.The realist school of thought on entrepreneurship is safe in their assumption on the other hand,that the entrepreneur's role is assured in the debate given the criticality of his role in the economic development of all countries of the world,regardless of the fact that the normative remains unanswered.This cognition of the role of the entrepreneur should lead us to a further elucidation of the behavioural aspect of entrepreneurship and the entrepreneur in my subsequent thoughts on the subject.

Leadership Qualifications In The Work Place.

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K We ask the question,how does leadership theories or qualifications correlate with productivity and organizational effectiveness in the work place?Are these theories or qualifications in themselves solely responsible for the differences in performance between two leadership situations?What makes the difference between these two outcomes? I take the view that beyond these theories of leadership and organizational effectiveness there are other attributes that shape leadership.For a leader to enhance his performance he must possess characteristics other than those identified,namely,traits,style and behavioral and situation,among others.Proponents of emotional intelligence(Salovery,Meyer,Bar-o and Abarman),argue that a mastery of one's emotion and those of others is one trait of a leader.On the opposite side of the literature divide(Ashkenazy,Daus,and Kagan),argue that it is a behavior that can vary with the situation a leader may find himself or herself in or encounter.Nevertheless,both sides agree that given the ability to manage one's emotion and by extension emotional intelligence,a leader is better able to achieve organizational goals than the leader without it. LEADERSHIP AND INTELLIGENCE: GOLEMAN''S ROLE. Goleman's definitive work on emotional intelligence in the work place represents a paradigmatic contribution to the literature on leadership theory.Despite the many criticisms of Goleman's work on EI by many authors mainly of the psychology faculty,his thesis finds relevance in the pantheon of leadership thinking and practice. It is Goleman's view nonetheless,that leadership goes beyond the crunching of numbers.Rather that it is about the achievement of organizational goals that require inter-personal skills.While the intelligent quotient,IQ,has traditionally been used to test an individual's intelligence,Goleman suggests that attributes to function productively requires,far more than this.Emotional intelligence,he defines is the ability to manage your own emotions and those of others in the organization,towards the shared goals of the business.A leader in the opinion of Goleman must have a combination of both sets of intelligence,IQ and EQ,that is.Good decisions he opined are "based on a balancing of rational(IQ)and emotional input(EQ) ,rather than one without the other. Effectively therefore,a leader is one imbued with sufficient attributes of intelligent quotient,emotional intelligent and social intelligent quotients.A socially intelligent leader is defined as one who recognizes the emotions of others in the organization,be he as team leader or chief executive.He listens a lot to others opinions before forming his own,empathizes and cares;helps others manage their emotions. Leadership Styles And Goleman's Emotional Intelligence. Emotional intelligence as propounded by Goleman(1995,2000),has continued to echo its attributes in the hallways of leadership.Is EQ's place assured in the pantheon of management/leadership theories?.Is emotional intelligence a trait or a behavior or both as some authors in criticism of Goleman have suggested. The purpose of this article is to identify the uniqueness of Goleman's construct among other theories of leadership and establish its continued relevance to the body of management knowledge,in learning,research and practice. The literature basically identifies six leadership types,listed by Goleman as visionary,coaching,affliative,democratic,pacesetting and commanding.The typology recognizes that the effective leader is one that is able to successfully transit from one style to another depending on the circumstance.Whereas earlier writers had dwelt extensively on the cognitive aspects of IQ,namely, problem solving,memory retention or rote learning,numeracy skills,studies such as Goleman's have shown that non-cognitive intelligence(EQ,SQ,CQ,)bear a more than proportionate share of a Leader's success quotient. The application of the EQ concept finds resonance in diverse situations in the organization.We find the concept useful in building teams and groups.Druskat&Wolff comment on building the emotional intelligence of groups,suggesting that group effectiveness is enhanced when individual emotional wavelengths are in synch with each other.Group effectiveness is been able to regulate individual emotions,an awareness of the limits of individual emotional thresholds,as well as those of the group.The authors are of view that three conditions are essential for group effectiveness and these are: "trust among members,a sense of group identity,and a sense of group efficacy".And the glue that binds all three are the group emotional intelligence.They recognize that team EQ can be complicated due to interactions between members who often draw from their individual banks of value,beliefs and preferences;a situation that tends to create or exercebate tension in groups. Collins,J,(2001),in his article "Level 5 Leadership:the triumph of humility and fierce resolve",associates high emotional intelligence with level 5 leadership.Level 5 leaders,he states,"have ambition not for themselves,but for their companies.They routinely select superb successors". Level5 leaders ,he continues,"want to see their companies become more successful in the next generation,comfortable with the idea that most people won't know that the roots of that success trace back to them".Level5 leaders are transformative,not egoistic,modest and humble even in the face of monumental achievements. Brett,J;et al,in their article,Managing Multicultural Teams,identify the many pitfalls involved in managing groups and teams with membership culled from various cultural backgrounds.They come to the team with various idiosyncrasies,,national preferences,beliefs,language differences and values.A team leader in such a setting must draw strength from sources beyond mental skills to be able to manage such teams.Due to these factors one often finds emotion running high due to,for instance,a member feeling left out of team or group deliberations because of He or she's poor language skills or lack of knowledge about social conventions of the domicile country. Managing such teams require the leaders assisting team members adjust to the norms of the group in ways not condescending,but respectful,helping to create emotional boundaries beyond which team members can not stray.And when such occurs,as it often may or would,to a new member,a gentle nudging back to the right path is suggested instead of the commanding style.The coaching instinct under Goleman's EQ is the ideal leadership style to use in such circumstance. Cohen and Tichy,in their article,"How leaders develop leaders"suggest that winning organizations are those who distinguish themselves from run-of-the-mill ones.They successfully develop leaders at all levels of the organization for effectivenes."Great leaders,they state,are great teachers".Great organizations and institutions,the authors opine,are great because of the ability of their leaders to "regenerate leadership at all levels,reinventing culture competences and tools at critical times".The visionary,affiliative as well as coaching styles of Goleman's emotional leadership styles resonate in their article. A treatise on effective leadership will not be complete without recognizing the place of ethics and leadership effectiveness(Cuilla,2003).The issue of ethics is central to the understanding of leadership.Issues of "personal challenges of authenticity,self-interest and self-discipline,and moral obligations,in relation to justice,the duty of care,competence and the greatest good of all",are those of leaders with high emotional intelligence quotient.The normative definition of ethical leadership by Rost(1991) is one which is " non-coercive,participatory and democratic in relationship between leaders and followers".Implied in this definition is the meaning that leadership is influential rather than inductive,recognizes follower autonomy and respectful of its opinion in decision making.The leadership process,Rost(1991),suggested is "ethical if the people in the relationship freely agree that the intended changes fairly reflect their mutual purpose".Ethical leadership from this perspective one hazards,is akin to the democratic style of leadership under the Goleman paradigm,where employees participate in the processes of policy formulation and decision making under a democratically minded leadership. THE QUINTESSENTIAL LEADER Searching for the quintessential leader is like searching for the holy grail of leadership,which exists only perhaps in the imagination.The quintessential would be one who depends on his attitudinal qualities not on his management skills.Attitudinal qualities mark out transformational leadership from that of the transactional(Weber,1947;Base,1978;Bass,1985;Bennis&Nanus,1985)Leaders with such qualities and behaviors,it is suggested,attract followers despite their human frailties and foibles which performance tends to mask from the followership,in the sense that they see these leaders as gods that can do no wrong;yet we are so far from the axiomatic truth that mortal man is susceptible to weakness.(Martin Luther King,Jr;Mahatma Gandhi,Nelson Mandela,Charles de Gaulle,and Lee Iococca) Are good leaders born or made?Some are born naturally to leadership;some are made while others have leadership thrust onto them by fate,for example,persons born into royalty through no fault of theirs.Others without knowing are born leaders only when situations that require their leadership are strewn their way.The literature lists some of the qualities of good leadership to be:integrity,confidence,passion,compassion,sincerity,determination,courage,humility and commitment.But then,what indeed is leadership in the light of our discourse?Leadership according to Cole(1996),is the art or process of influencing or directing people who are willing and enthusiastic toward the achievement of organizational or group goals.It is counter-intuitive to say that leadership flourishes only when there is a willingness and enthusiasm to be led.Take away these two ingredients from the equation,then we could have a faltering leadership not worth it's name in gold.Leadership therefore is a marriage between the leader and a willing and enthusiastic followership in cherished embrace towards shared goals of stellar organizational performance. For us to complete the definition we consider Doyle &Smith's suggestion of the four things in leadership,namely:influencing followership,clarity of Leader's goals,vision and situation(s),such as crisis or problems requiring leadership.These four things they state instinctively throw up leadership skills in individuals. John Adair of the University of Surrey and Sandhurst,England,offers us his schematic of leadership qualities to illustrate the quintessential leader model: at the peak of the Adair triangle is Positional Authority,with Personal Authority and Knowledge Authority at the base.Personal authority encompasses enthusiasm,integrity,toughness,humanity,humility,tact and warmth;knowledge authority embodies technical and competent knowledge(Table 1.0) MY LEADERSHIP MODEL. The literature on leadership is eclectic and this eclecticism is responsible for the numerous theories,concepts and frameworks on the subject from didactic sources such as sociology,psychology,psychometry,management sciences,and many more.Broadly speaking,we can categorize these models under four headings as post modern and classical trait,behavioral contingency,style and situational.We recognize as indeed the literature does that no one typology or model captures the whole essence of the human dimension of this enigmatic subject.What practice has had over the years leading to the propounding of theories and frameworks,has been the bio-sociation of ideas from two or more sources which seeks to meet the exigences of a situation leadership is thrown into.These situations in turn call to the fore,the innate abilities and learnt skills of the leader. It is within this frame that we state that emotional intelligence as a behavioral paradigm is a response to the inadequacies of the theories that a priory were before it; of traits(Fiske,1949;Norman,1967;Smith,1967;Golberg,1987;the behavioral of Blake&Mouton's managerial grid,1964;Ohio studies,the University of Michigan studies,the situational theories of Hersey&Blanchard,1974;Robert House,1971;Vroom&Yetton,1973 and Fiedler,1970. Observably,it is argued that these theories relevant as they were at their time,have failed to capture in their entirety the critical discriminating factor that delineates one effective theory from the other.Why for instance one set of leaders lead their organizations to ruin(Gilmans brothers),others lead to create legacies(Bill Gates,Steve Jobs,Warren Buffet,George Sorros,Jack Welch,Sam Walton). These theories fail to delineate how some leaders regenerate their kind,and others don't,Cohen&Tichy(1997);or why some destroy their companies through unethical behavior,Ciulla,(2003)(Enron,Worldcom,Lehman Brothers,Bernard Madoff). My position is not to denigrate these theories and concepts that illuminated the study and practice of leadership;for what it is worth,the dichotomy between transformational leadership and the transactional type is based in my estimation on the differentials in the behaviors of both types of leaders.Behaviours that cannot be driven by agency or organizational considerations.These leadership types are dispositional to the situation they both may find themselves.The differentiating attributes between both types are in the attitudes,personal character,learning and emotional reserves(Goleman)Adair further illustrates this dichotomy again using the principle of the triangle,where leadership at various levels of an organization is located.Control of the entire business or organization is strategic or transformational;operations involves the control of a number of teams which may constitute a complete operation and is transactional;at the base of the triangle lies the leadership of one team.Adair's model symbolizes the ""syndicated leadership" model propagated by Gary Hamel.This we could also refer to as distributed leadership elucidated in an article by the author (Distributed Leadership:towards a new paradigm,2013). My leadership model is one that integrates traits and behavioral attitudes which finds support in Robbins&Judge's suggestion on the question.The integrative model entails the following attributes:skillful in dealing with people,capacity to motivate,understand followers and their needs,firm and decisive,trustworthy,competent,humble and modest,passion for excellence and above all courageous. Furthermore,Gardner,J;(1989) in his study of a large number of American organizations and leaders was able delineate some attributes of a quintessential leader.The study also concluded that leaders can offer leadership in more than one situation.The attributes include:physical vitality and stamina,intelligence and action oriented judgement,eagerness to accept responsibility,task competence,understanding of followers and their needs,skill in dealing with people,need for achievement,capacity to motivate people,courage and resoluteness,assertiveness,adaptability/flexibility.The case study here below,illustrates the task that can confront you as a leader and what needs to be done.It is set in a multicultural environment where most of the present day leadership skills are needed. LEADERSHIP IN A MULTICULTURAL TEAM: Tom Jones,35,is technical manager of a medium sized engineering firm,Altech Ltd,with foreign offices in two European countries,Spain and United Kingdom.Headquarters is in the United States,Los Angeles,California.Tom Jones has been tapped by his boss,John Spigler,Director/Vice President of engineering to head a cross functional team made up of young dynamic college graduates,Li Na is Chinese,responsible for customer service and was recruited out of Hong Kong.Danni Lopez is Mexican with an engineering degree,Jim Hayes is British,he also has an engineering back ground,worked on several in-house projects prior to this assignment.Joanne Cross,human resources and Alain Dupre,French in charge of production;Arun Menon,Indian,comes to the team with years of experience in IT.The task is to push the firm's new product into its two overseas markets,whose sales have not been too impressive since its entry into the markets.Headquarters believes this new product will improve its market position through an increase in its market share.Jim Hayes and particularly Dani Lopez see Li Na as an outsider,having been appointed to the team immediately upon her arrival from Hong Kong.Li Na does not have an engineering background like the rest of the team.Joanne Cross is also a non-engineering graduate,however she has worked with Li Na's interlocutors during previous assignments and they have come to appreciate her intellect. Li Na feels rejected and asked Tom Jones to retire her from the group and assign her else where.Tom Jones needs to decide between the opposing sides and the possibility of Li Na being rejected by another team working on other projects is distinct.Jones will need to use his authority,tact,and ability to navigate this one.Time is of the essence.His leadership skills are called for,he needs to be decisive and firm,careful not to upset the team balance.Jones needs to draw the boundaries of the team or should he allow members work out the problem,careful not to disturb the existing norm?Yet he must get the team to appreciate Li Na's role and function in the group.Surely her talents are not hidden from management hence her appointment into the task force.Although,Jones recognizes that group cohesion can only come from within and not without by fiat,he needs find a way to bond the team to achieve the goal for which it was constituted. SUMMARY Good or quintessential leadership is one that demands the drawing on of a Leader's strengths and behavioral characteristics,which in turn draws from his mental and spiritual well. Leadership may depend on the Leader's possession of management skills ,but leadership like an author said,"relies mostly,strongly on less tangible and less measurable things like trust,inspiration,attitude,decision making and personal character".A review of our discussion reveals a division between supporters and opponents of Goleman's construct of Emotional Intelligence and its place in leadership effectiveness.We have established that EI is both trait and behavioral,both intersecting at the cross- road of situational and contingency models.For whilst EI opponents fault it's validation,what cannot be faulted is its place in the pantheon of management theory as a contributor to leadership effectiveness.The absence of this descriptor,the literature has suggested,delineates the difference between transformational and transactional leadership types.