Celebrate Entrepreneurship

I had the opportunity to work at the Best Buy Company from 2001 to 2009. Although the company was formed in 1966- almost 45 years ago- I was always surprised and impressed to see the founder, Richard Schulze, as a frequent presence at corporate headquarters. While Dick Schulze long ago turned over day-to-day operational responsibility and decision making to others, his innovative spirit, willingness to take risks, and drive for results are still very much a part of the corporate culture. Even though Best Buy is now one of the largest business enterprises in America with almost $50 billion in revenues and 150,000 employees, it is still a company that celebrates entrepreneurship.

It is absolutely fascinating to contemplate that every business in the world, including behemoths like General Electric (Thomas Edison), Wal-Mart (Sam Walton), Toyota Motor (Kiichiro Toyoda), and Mary Kay Inc. (Mary Kay Ash) started as nothing more than an idea in someone's head. That person either had a new and better idea, or got sick of working for someone else, or both. And he or she also invariably had a high tolerance for uncertainty and an intense determination to succeed.

It is this powerful spirit of entrepreneurship without which we could not survive and the world economy would crumble. While clearly not everyone is cut out to be an entrepreneur, we all desperately need and depend on these founding visionaries- whatever the size of the enterprise they invent- to continue to innovate, to strive, and to build.

There is a strong difference of opinion as to whether entrepreneurship can be taught. Are entrepreneurs born, or can they be made? If the increase in formal entrepreneurial education over the last thirty-plus years is any indication, many business schools believe the skills can be learned. Today, better than 2000 American colleges and universities offer classes in entrepreneurship, compared to a paltry 200 back in the 1970s.

Gregg Fairbrothers is the founding director of the Dartmouth Entrepreneurial Network, and he teaches a hugely successful course in entrepreneurship at the Tuck School of Business. In Fairbrother's class the students learn through experience; the vast majority of the work takes place outside the classroom. Students develop and present their own ideas for a startup, and then are tasked with refining their approach, testing in the marketplace, and pitching to potential investors to secure financing. Clearly, Fairbrothers believes that learning by doing in the hard school of the marketplace is the only way to teach entrepreneurship.

Fairbrothers also acknowledges that entrepreneurship is a difficult concept to define and measure with any precision. He suggests that entrepreneurs are characterized more by a set of identifiable traits than by what they do, and that the range of entrepreneurial behaviors can be plotted along a classic bell curve. In a recent Fortune Magazine article Fairbrothers says, "So the question is, can you take a point on that curve and move it? If 'entrepreneurial' is to the right, can you move it that way? I know I can move it that way. I've done it."

Entrepreneurship, therefore, is not a single trait that some individuals and organizations possess and others do not. It is not an all-or-nothing proposition, but rather a spectrum of behaviors that includes innovative approaches, calculated risks, and willingness to fail and try again.

Starbucks CEO Howard Schultz recently held a series of brainstorming meetings with a group of his employees. Schultz was the entrepreneurial visionary behind the massive growth of the Starbucks brand. He left the company for a time only to return in 2008 as Starbucks struggled to maintain its impressive growth. The employee focus group helped in the effort to return to entrepreneurial roots. Schultz says in a recent New York Times interview, "We lost our way… [so] we went back to start-up mode, hand-to-hand combat every day. And with the kind of discussion and focus that probably we had not had as a company since the early days- the fear of failure, the hunger to win."

Among other things, Starbucks now works to give its stores a local feel that reflects neighborhood history and architecture, and even displays the work of local artists. The company places greater emphasis on satisfying regional differences among coffee drinkers; Sun Belt customers prefer cold drinks and those in the Pacific Northwest drink more espresso, for example. Starbucks coffee buyers no longer focus exclusively on purchasing only beans produced in sufficient quantity to supply all stores; they now also buy local blends made in small batches.

While the jury is still out, as of early 2010, Starbucks had seen healthy increases in revenues, same-store sales, and its stock price. Leadership guru Warren Bennis says of entrepreneurs like Schulz that they, "keep shaking things up and pulling the stakes out of the tent because they like the mud and the chaos of reinventing, and Howard has a bit of that in him."

Do you as a leader display entrepreneurial behaviors? Do you like to shake things up, try new ideas, and take the occasional calculated risk? How about the organization you work for? Where does it sit on the "Entrepreneurial Bell Curve?" Do you celebrate entrepreneurship or have you become bureaucratic and stagnant? No matter the age or size of your enterprise (think Best Buy Corporation), a conscious effort to cultivate and maintain entrepreneurial roots can provide a healthy boost in performance.

Simplify and Prioritize

I know an executive who has a forty-page list of personal action items. Not forty items, total, on his to-do list. Forty pages, single-spaced, in a bound notebook. I have had professional dealings with this leader and I can tell you from personal experience that while he is a terribly busy man with a lot to do, he gets absolutely nothing done. He does not follow up on the most basic tasks, like returning phone calls or responding to e-mails. He cannot be counted on to deliver an outcome on anything. He tries to do everything, yet he accomplishes nothing. He is in a position of real power and his organization suffers greatly for his complete lack of focus. He has failed to adhere to that most fundamental yet important leadership principle: simplify and prioritize.

Simplifying and prioritizing starts with each of us as individual leaders. If we don't know what we are trying to accomplish in our own jobs, then there is no chance that the teams we lead will be any better focused.

In a recent interview the CEO of Continental Airlines, Lawrence Kellner, was asked how he manages his time. He replied, "I used to have a long, long to-do list. At the end of the day, I'd see which ones got done. Then five more notes might be on my desk, and I'd throw them on the list. I realized I was often doing what came to me as opposed to what was really important. So I started saying, 'O.K., what are the three most important things I need to do today?' And if No. 1 is a 12-hour task, then I'll spend the day working on it. I need to decide what's the most value-added thing I can do." In short, Kellner succeeded in taking charge of his professional life by proactively prioritizing his efforts, rather than simply reacting to whatever was in front of him. How well do you practice this skill as a leader?

Once we have our own priorities in order, the next task involves making sure our organizations and teams know what their priorities need to be. Again, Kellner is a model of good leadership in this regard. He says, "When I became CEO, I started ending each of my three most important meetings each month by saying, 'O.K., here are the three most important things we're doing. Here are the three priorities." His followers at Continental were no doubt grateful to him for explaining in clear and concrete terms exactly what he expected of them.

Great leaders instinctively understand that their teams are looking to them to identify just a small handful of key objectives, three or four at the most, and to communicate those objectives effectively. William Green is the chairman and chief executive of Accenture, the global consulting, technology services and outsourcing company. Green relates a story about how he was able to simplify things for a group of brand new employees: "I once sat through a three-day training session for new managers. I counted 68 things we told them they needed to do to be successful. And I got up to close the session, and I said there are three things that matter. The first is competence… The second one is confidence… The third thing is caring…" From 68 things to three. Again, this group of Accenture managers surely appreciated their chief's willingness to help them prioritize in their jobs, and in their leadership journey.

Cristobal Conde is the president and CEO of SunGuard, a software and IT services company, and he was notorious early in his career for micromanaging and making every decision himself. He soon realized the futility of this approach. He recalls, "That was in the early 90s, and that experience convinced me that the right way to do it is the opposite, which is to hold people accountable, to really restrict the number of things you say to them, and to decide the one or two things that are most important. You have to do that consistently over a year before you start having an impact." Indeed, it takes time to hammer a message home, but if it is simple and consistent, people will eventually respond and deliver.

Alan Mulally has been the president and chief executive of Ford Motor since 2006, and has led that company to extraordinary levels of achievement and value creation in an incredibly challenging time for the auto industry. Mulally is another leader who stays focused on a few key objectives. He says, "I've moved to a place where I'm really focused on four things. I pay attention to everything, but there are some things that are very unique to what I need to do as a leader. One of them is this process of connecting what we're doing to the outside world… A second focus for me is: What business are we in? What are we going to focus on? The third one is balancing the near term with the longer term… And then I really focus on values and standards… I'm the one who needs to focus on those four things, because if I do that, the entire team will have an understanding of them."

Albert Einstein once said, "Any intelligent fool can make things bigger, more complex, and more violent. It takes a touch of genius- and a lot of courage- to move in the opposite direction." The best leaders have an uncanny ability to simplify what is complex. They know what is truly important and what is not. They can identify the most critical challenges before them and prioritize those challenges so as to maximize their precious time. And they communicate these simple priorities to their team, again and again, in a way that helps people know how to direct their own efforts and to achieve results. Great leaders are incredibly adept at simplifying and prioritizing.