Cultivate Entrepreneurial Employees
· Print This Article"When I worked for Mercy Corps, it was a very entrepreneurial enterprise. For instance, if we wanted to take on a new project, we had to own it. Isn’t that how most small businesses are run?", Mara asked. The woman I was having dinner with at a Lebanese restaurant in Jordan had previously worked for that great humanitarian-assistance non-profit Mercy Corps for a number of years and I was fascinated with her explanation of how the organization is run.
But, to answer her question, I had to reply, "Unfortunately, no."
Essentially, much of what they do is based on what they call "social entrepreneurship"; an idea that is, ironically, too often missing in most small businesses. Let me explain:
Let’s say my new friend had what she thought was a great idea for a new Mercy Corps program. Like any Mercy Corps employee, she was free to suggest it, but that was just the beginning. If she really liked the idea, she had to think and act like an entrepreneur:
- Like any entrepreneur, she had to show there was a genuine need for the program (i.e., her product), a need that wasn’t being already met
- She had to figure out the best way to implement her idea
- She had to figure out what it would cost
- And, maybe most interestingly, like any great entrepreneur, if she could do the above, and could implement the program and solve a problem, she also had to take long-term responsibility for it and own it.
What became obvious to me over the course of the evening was that by treating its employees as entrepreneurs, Mercy Corps empowered them to be more than just employees. They were able to be creative individuals with the chance to think big and implement their vision when it made sense.
Isn’t that what we all want from the people we work with? People who think beyond merely doing their job and look to see how the whole can be improved? Yet how many of us have actually created organizations and businesses that empowers the people we work with in that way? I would venture to say not many of us.
Is it not ironic that entrepreneurs rarely foster entrepreneurship in their own businesses? I think most are so busy, happily being the boss, that the idea of people acting like entrepreneurs is almost scary.
Am I wrong? Please let me know if I am, but I don’t think so.
Now, the best big businesses often get this idea; a new program won’t be implemented 
unless someone owns it and budgets for it accordingly. In fact, one such corporation created a whole new management system based on the idea of turning employees into stake-holders. Called Open-Book Management, it originated at a manufacturing company called SRC by a business owner named Jack Stack. As the name implies, Open Book Management ends the traditional practice of hiding the financial ball. The rules for Open-Book Management are that you must:
- Give employees the training necessary to understand how their job, financially, ties into the overall business plan
- Give them all relevant financial info for the company — everything from what it costs to do their own job to what the CEO makes
- Give them responsibility for their own numbers, and finally
- Give them a financial stake in the overall company bottom-line
The result is that employees, by not having the financial ball hidden, and by having an ownership stake in the outcome, become more productive and entrepreneurial and the company flourishes.
What I am suggesting today is that this is not a bad idea for small businesses to look at. What would happen in your business if employees were encouraged to look for projects that could help the business, decide if those projects make sense, prove it, and then were given the responsibility for implementing and owning the project? A revolution in productivity and interest, perhaps?
Entrepreneurs, maybe it’s time to create an entrepreneurial business from the inside out.
Tip: For more information on Open Book Management, you might want to pick up The Open-Book Experience: Lessons from over 100 Companies Who Successfully Transformed Themselves by John Case.
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We have owned or managed businesses for over thirty years 9my hubby & I). We always believed in full disclosure, allowing employees to make decisions, etc… as you mention… and it always worked until our latest adventure. We got bit in the you-know-what. I won’t go into details (looonng story-nightmere with a a certain company, which almost put us out of business before we started)… but anywaay, we had meetings, we explained to employees what was going on financially and why. We begged, pleaded, motivated, & encouraged for their help, support, input. what we got was employees stealing us almost blind, thinking we were going out of business, or that they felt it was “owed” to them. You should specify when, to disclose, and just how much info to disclose….and what could happen – on the down side of doing so.
Wow, fascinating view. However, there better be a good job screening process in place to ensure employees have entrepreneurial chutzpa. I’ve made a career out of helping entrepreneurs launch companies and brands, so I’ve seen it all before. The details excite and motivate me. But, a friend of mine is working for a struggling start-up (2nd year) that shares financial details as you describe above, and the stress is practically driving him to drink. His Fortune 100 resume simply can’t wrap it’s mind around negative cash flow, and the fact that the company may miss payroll (to make it up later, of course) is literally making his hair fall out. I applaud the concept you propose, but caution that it only be implemented with the right team.
.-= Kathy Ver Eecke´s last blog ..Brother- Can You Spare a … Platinum Card =-.
Story #1: Way back in the 80′s, I worked for a great, entrepreneurial subsidiary of a huge American corporation. Each had broad name recognition in the market and each had radically different corporate cultures. The parent recognized this and maintained a hands-off demeanor for 2 decades. As a result, the subsidiary became hugely successful with the entrepreneneurial spirit encouraged by its own company president and it contributed significantly to the happy story its parent told in in annual reports. However, the very entrepreneurial, shoot-from-the-hip spirit encouraged by the subsidiary soon dwarfed, in the mind of the parent company, the great financial success its unit brought it. So, within 2 years of my own departure, the entrepreneurial spirit was shot down, every sr. level executive that had helped the unit thrive was gone and a family member of the parent was throned.
Moral of the story: It’s important for a company principal to be completely objective about what they seek w/its employees’ efforts and creativity because ego and self-image can over power most anything.
Story #2 – In that subsidiary company, the president understood it takes more than conferring responsibility and resources on a willing internal entrepreneur (which he called, and I’ve since adopted “intra-preneurs”); you have to give them authority as well so know they have the confidence and ability to take action, with the necessary support to execute their ideas. During the 10 years I was very happily employed there, I was given almost carte blanche to take an idea which had begun to show fruit (and conceived by others) and leverage the heck out of it so it became a model of sky-high profitability and success.
Moral of the story: 20 years later, I still enjoy giving a client’s employees the means and encouragement to dream and do big because it’s the model of the perfect win-win scenario: the employee is encouraged to excel at what s/he does well, thereby enjoying a sense of empowerment and success to do it again; and the company reaps the revenue (or cost-savings) rewards.
.-= Andrea Feinberg´s last blog ..If You Win a Lottery Do You Need Skills to Build Your Fortune =-.