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MBM Principal Sources

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05 June 2007


David McGinnis

I agree with most everything you wrote...
some would define an entrepreneur as "...commonly seen as a business leader and innovator of new ideas and business processes." Also the definition includes that this is the risk taker, the one who essentially bets his job on his purpose, venture, or idea. Really, aside from MBM, you cannot find employment with a company AND trade risk for reward in a business venture.
I believe this is why the term 'entrepreneur' is so enticing. If someone has a great plan or idea, they want to get credit for it, and are often willing to take a significant risk for the compensation it may bring.
I know I don't have to convince you that the Principles are tied together with the Framework (as in Value Creation and Principled Entrepreneurship tie so well with Incentives...)

Eric Jandrain

There are some excellent points made in this article. Entrepreneurs should constantly challenge the market with new ideas and new approaches to solving old problems. Entrepreneurs also deserve just compensation for value creation. I think Koch is one of the first companies to attempt to measure the value an employee creates and spread the reward to those who deserve it. This may be a hard concept for someone who feels entitled to compensation just for showing up to work.

By having entreprenuership within a company, there is less risk to the individual, but a similar or greater potential to create value. If entrepreneurship is applied correctly within a corporation, the company stands to retain individuals that may otherwise seek methods to apply entrepreneurship elsewhere.

Great article!

Darin Dredge

The American Heritage Dictionary defines entrepreneur as, "A person who organizes, operates, and assumes the risk for a business venture." Venture is defined as, "An undertaking that is dangerous, daring, or of doubtful outcome." I do not see "business owner" anywhere in these two definitions.

I always thought of being an entrepreneur as an attitude as opposed to a skill set. Indeed entrepreneurs have to possess skills to create value, but without an attitude that challenges the status quo and seeks opportunities the skills are just skills. A good visual representation of this in MBM is the Virtue & Talents Matrix.

In my opinion one of the more difficult aspects of promoting entrepreneurship in the organization is the risk vs. reward relationship. When you own the business you take all of the risks and reap all of the rewards. In an organization, it is more difficult to mirror this risk vs. reward relationship. Perhaps this is one of the reasons why the conventional thinking around entrepreneur defaults to business owner?

David McGinnis

Very interesting to read my own comments 3 years later. This link came up from a poll asking if entrepreneurship is more nature or more nurture. (HT: Ann Zerkle) I think that as a manager, the nurture domain is uber-critical to draw out and encourage Principled Entrepreneurship (PE) from your employees.

For the sake of argument, let's claim that most humans have some Nature of PE, but if they don't have enough tenacity to overcome some risk, a manager can reduce the risk (at minimum the social risk) by defining and cultivating a culture that encourages Principled Entrepreneurship. Conversely, a timid individual with excellent customer focus and wonderful ideas may not sense any avenue to behave with initiative and a risk-taking mentality.

So maybe I can phrase it like this:
A strong PE nature works, but is rare.
A culture that in effect nurtures PE can extract limitless talent from a limited number of employees.

your thoughts?

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