Entrepreneurship 101 for Leaders in the Enterprise
There has been a big push lately to have enterprises focus on entrepreneurship and innovation. The Lean Startup began as a system for, well, startups. Now it's seen as an important component in the enterprise, large and small. But if you're an enterprise trying to act like a startup, where do you start? How can you capture that entrepreneurial spirit within your organization? Let's start with some basics.
What Is an Entrepreneur?
We see entrepreneurs as trailblazers that aren't afraid to fail. They innovate and create value where others only saw problems and roadblocks. They're willing to invest their own time, money and efforts into their endeavors. Fortunately, within an enterprise, we're not typically putting up our own money when we launch a product. However, there are facets of the entrepreneurial mindset that will drive innovation and ensure you're putting effort into viable endeavors. Here are some truths about entrepreneurs to keep in mind as we discuss this topic: Focus: Entrepreneurs don't worry about the next promotion or status. They focus on building a product that sells. Creativity: In the enterprise, we're often pulled to use proven solutions to problems. Entrepreneurs instead work to solve problems in new and creative ways. They don't do things just because that's the way it's always been done. Flexibility: Entrepreneurs bend and flex to take advantage of changing conditions. They don't have the luxury of seeing if a product is successful in five years. They need to adjust frequently to make sure they're headed in the right direction. Risk-Taking: Entrepreneurs are willing to risk effort on products that may not end up being realized or that become something else entirely, following the validated learnings they gather from the market. Objectivity: And finally, entrepreneurs prove the viability and profitability of their products with metrics and sales, respectively. So how do we find and develop the budding entrepreneurs within our enterprise that will help us continue to grow?
Foster Entrepreneurship in the Enterprise
Whether your enterprise is a large corporation or a small sole proprietorship, there are many ways that you can take advantage of an entrepreneurial spirit. At the center of all of companies is the need to create a culture of learning and ownership. Give your people the tools and time they need to innovate. Then get out of their way.
_"Move fast and break things"—_Mark Zuckerberg
For a lightweight entrance into entrepreneurship, sponsor one- or two-day hackathons within your company. Ensure that management understands that everyone's welcome to join, barring unforeseen production issues. The goal of the hackathon should be to write a lean app with only the required functionality. This isn't the time and place for following a production checklist. And it should be clear that teams aren't there to create PowerPoint presentations or think of the perfect marketing strategy for something that hasn't been built yet. They are there to take an idea and make it a reality.
Personal Project Hours
Many companies are now encouraging employees to take 10–20% of their week and spend it on personal projects. It keeps staff engaged and excited, and it can increase their skills in areas that will help the company develop new products and tools. However, a bucket of time with no restrictions can devolve into “spend four hours catching up on emails” or “spend a day working on administrative tasks,” as personal project hours may be the only quiet time the employees have in their workday. Something should come out of this time—learnings to share with teammates, a prototype to test in the real world, or new tools that can help improve your CI/CD cycle.
Whether you have an innovation center within your enterprise or you have product teams as a regular part of the business structure, your main goal should be to create autonomous and lean teams that are free to bring a product to market. Product teams include all parties needed to launch a product. They should include engineers, designers, product managers, and owners. If your enterprise has a separate organization for operations and database management, it's time to start embedding those employees in the product teams, too. As part of leadership, you need to trust that the teams will do the right thing. Let go of pushing ideas and direction down. Teams can take a build-measure-learn approach, as advocated by the Lean Startup, to define what direction the product should take. With this, they'll be iterating, using minimum viable products (MVPs) to validate assumptions and learn how to adjust and reevaluate priorities. They'll be talking to real customers and getting feedback as soon as a feature is finished.
Enterprise Problems and Entrepreneurial Solutions
If you've followed my advice up till this point, you now have autonomous teams working on products that they own. So what's your role as a leader in this new entrepreneurially-minded world? Well, you should make certain your teams are headed in the right direction. And you'll want to be sure they have what they need in order to deliver. But, as we'll cover next, one of your biggest jobs is to clear their path to success. And that path is likely to be littered with enterprise-level problems. Here are some common roadblocks that you can remove for your teams, helping them to work in a more entrepreneurial style.
Fear of Failure
People don't like to fail. It's a hard aversion to overcome when school and the traditional enterprise has taught that the worst thing you can do is be wrong. This leads to teams incentivize keeping failing products on life support—how it will look to the enterprise if they fail completely? But when you start taking risks, there will always be failure. In fact, if there's no failure, you're not taking enough risks. As a leader in the enterprise, you should create an environment in which risks and failures are not only accepted but encouraged and learned from. Instead of burying the failures, do as an entrepreneur would: share them. Tell the story. What attempts were taken to correct the issue, and what ultimately drove the decision to pull the plug?
Your enterprise leadership team may have years of experience and knowledge that got them to their current position. This may encourage them to force solutions onto teams and to mold products to their own mental image. But their assumptions may not reflect the real world. As someone in leadership, remember that there are markets that you've not considered, even if you've done all the right research upfront. The real innovation will come from ideas and markets you cannot read about in a white paper. Entrepreneurs embrace ambiguity; you too should accept that your answer, most likely, is yet unknown.
Red Tape and Slow Decision-Making
Over time, processes at large corporations accumulate red tape, bureaucracy, and a laundry list of people involved in decision-making. These buffers were created to fix problems or avoid pitfalls that may no longer be relevant. As a leader trying to adopt the spirit of a startup, you should make it a priority to review and remove unnecessary requirements, and you should streamline and automate things that are required. Make it your focus to alleviate blockers to teams delivering quickly. And try to make sure it's just the product team that's making the necessary decisions.
Yearly budgets are an artifact of the enterprise. For lean products, MVPs, and innovative teams, your project budget from the day-to-day business should allow for fast allocation and approval. These budgets span ninety days or less. Define the criteria for extending it for the next ninety days based on metrics and learnings. In a startup, teams own the budget and decide how to spend it. Likewise, your team shouldn't answer to another department or leadership chain. However, they should be able to justify increasing budgets with metrics that show the need for it. They should also have the authority to end a project that's going nowhere.
In the enterprise, teams are often separated by function. There's the application development team, a database team, maybe an application maintenance team, and so on. This forces your entrepreneurial product team to depend on other teams, with potentially conflicting goals and deadlines. But to be like a startup—as with agile and delivering thinly sliced stories—teams should be cross-functional holders of their own destiny. They should have their own databases and operations. And your teams should be free to interact with the customers directly and learn from them. The lesson from the entrepreneurial world is this: for innovative new products, make sure you're not hindering teams with bottlenecks from other groups.
Ultimately, the goal of leadership is to define expectations, remove roadblocks, and then stay out of the way. If your enterprise is new to the entrepreneur's mindset, start small, just as you would as an entrepreneur. Create a hypothesis on what will work in your company and create an MVP to validate those assumptions. And remember, it isn't just your teams that iterate and learn—you too will need to evolve your process over time as you learn to enhance and foster entrepreneurship in the enterprise.
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