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Entrepreneurship andManagement: Differing ButComplementary Processes
by Louis Jacques Filion
Cahier de recherche n 94-04-01
This paper highlights the differences between managers and entrepreneurs. It showsthat the self-awareness attributes of managers and entrepreneurs differ considerably.Know-how is also different, with managers' know-how being focused on resourceorganization and entrepreneurs' know-how on defming contexts. The paper discussesthe consequences of these differences on education. Management education shouldhelp students understand organizational context 50 that they can operate efficiently andeffectively, whereas entrepreneurship education should focus on defming andarchitecturing contexts.
ENTREPRENEURSHIP AND MANAGEMENT:DIFFERING BUT COMPLEMENT ARY PROCESSES
The need to develop programs, courses and training activities inentrepreneurship seems to be increasing yearly in a growing number 0 fcountries. QJ.testions often raised by people developing these programs are:What is different in management and entrepreneurship7 What should anentrepreneurship education program contain7 What courses should be offered7How should the courses be given7 This paper does not set out to answer a1l thequestions. What it does is to present a certain number of guidelines developed tomeet education needs. It is based on a decade of experience iD entrepreneurshipresearch and the design and management of undergraduate and graduateuniversity-Ievel small business and entrepreneurship education programs.
MANAGEMENT AND ENTREPRENEURSHIP: SOME DIFFERENCffi
Timmons (1978), Hornaday (1982), Brockhaus and HornHisrich (1986) made a survey of the literature on the commonoften attributed to entrepreneurs. These characteristics are pre1 below.
TABLE 1Common Characteristics of Entrepreneurs
TenaciousAble to tolerate ambiguity and uncertaiGood users of resourcesModerate risk-takersImaginativeResults-oriented
These basic characteristics can be found in self-employe4business operators and entrepreneurs in general. HIcharacteristics were identified that are common to successful(Filion, 1991). They are set out ln Table 2.
Entrepreneurial values and culture acquired through contactwith at least one entrepreneurial model in their youthExperience of businessDifferen tiationIntuitionInvolvementHard-workersRealistic dreamers (visionary)LeadersModerate networkersRelations system of their own with employeesCon troll ers of behaviour among people around themLearning patterns of their own
. (1982), Brockhaus and Horwitz (1986) andthe literature on the common characteristics
These characteristics are presented in Table
TenaciousAble to tolerate ambiguity and uncertaintyGood users of resourcesModerate risk-takersImaginativeResults-oriented
in self-employed people, smallgeneral. However, other
ln to successful entrepreneurs
TABLE 2Successful En trepreneUTSof
Wortman and Birkenholz (1991) offer a condensed overview of the field ofentrepreneurship. Our concem Is not as much with the psychologicalcharacteristics of entrepreneurs as with the dlfferential aspects of how theyoperate: in other words, with how they conceive, design and operate theirhuman activity systems.
Mintzberg (1975), Boyatzis (1982), Kotter (1982) and Hill (1992) aIlexamined the work of managers. These studies reveaI considerable differencesin the operating methods of managers and entrepreneurs, as Table 3 shows.
TABLE 3Differences in the Activity Systems of Managers and Entrepreneurs
Work on efficient and effective use of Set a vision and objectives andresources to reach goals and objectives identify resources to help realize
Key is adapting to change Key is initiating change
Work pattern implies rational analysis Work pattern implies imaginationand creativity
Operate within an existing fram,
Work centred on processes that take theenvironment into account
Managers pursue objectives by making effective and efficient use ofresources. They normally operate within frameworks previously defined bysomeone else.
The organizations created by entrepreneurs, however, are really anextrapolation of their subjective worlds. What entrepreneurs do is c1oselylinked to how they interpret what is happening in a particular sector of theenviron ment. Their own knowledge of a specific market or the development ofa new product or manufacturing process will lead them to envision and marketsomething different. They define ways of doing things that reflect what theythemselves are, and their success depends on how appropriate and differentwhat has been defined is and how it meets changing needs. Not only doentrepreneurs define situations, but they imagine visions of what they want toachieve. Their main task seems to be to imagine and deftne what they want to doand, often, how they are going to do it.
Generally speaking, management is associated with Jentrepreneurship with intuition, although in both cases t]considered to be predominant rather than exclusive attributes.activities require a systemic framework that includes concepts [Drucker, 1985], although on a different level to management,activities also demand elements of intuition and imagination.
Define tasks and roles that createan organization framework
Work centred on the design ofprocesses resulting from adifferentiated view of theenvironment
rationality andthese should be
, and managerial1. However, the
conceptual activities and skills of the two groups being different, theireducational requirements should also be different.
ENTREPRENEURIAL AND MANAGERIAL EDUCATION
These basic differences between managers and entrepreneurs demandfundamentally different educational and training methods. ln educationgenerally, emphasis is placed on knowledge acquisition, whereas inmanagement education it is placed on acquisition of know-how, and inentrepreneurship education, on self-awareness [Gasse, 1992]. Table 4 examinesthe consequences of the differences listed in Table 3 on educational approaches.
TABLE 4K.ey Differences between Managerial and Entrepreneurial Education
Manaszerial Education EntreDreneurial Education
Affiliation culture supported Leadership culture supported
Centred on group work and group Centred on individual progressioncommunication
Works on the development of bothsides of the brain with emphasison the left side
Develops patterns that seek abstract,general rules
Based on the development of self-awareness with emphasis on adapt-ability.
Focused on acquisition of know-how inmanagement of resources and ownarea of specialization
This limited comparison brings out two complementary concepts: know-how and self-awareness. Both are manifested differently in managers andentrepreneurs. ln terms of self-awareness, many authors insist on theadaptability of managers [Archambault, 1992; Hill, 1992], whereas forentrepreneurs one of the key words is perseverance [Homaday, 1982; FiUon,1991]. ln terms of know-how, managers must use rational approacbes, butwithin a pre-defined working framework. Entrepreneurs, on the other band.must take an imaginative approach and define their own working framework.They must identify a niche and then imagine a vision, or a space to be occupiedon the market and a type of organization needed to do so. Research onentrepreneurial activity systems shows that an entrepreneur's work consistsmainly of defining contexts and working frameworks [Filion, 1990].
The following sections examine some specifie aspects of entrepreneurialeducation and suggest approaches that could be used to provide better supportfor the particularities of the discipline.
Works on the development of bothsides of the brain with a strongemphasis on the right side
Develops patterns that seek con-crete, specifie applications
Based on the development of self-awareness with emphasis onperseverance.
Focused on acquisition of know-how directed towards the definitionof contexts that lead to theoccupation of a market space
ln any educational program, what is important is not just what is leamt,but how it is learnt; in other words, the learning pattern established.Participants in an educational program should feel comfortable and ready toplay the new role for which they are being prepared. An entrepreneurshipprogram should therefore concentrate on the development of self-awarenessand the acquisition of know-how rather than simply on the transmission ofknowledge. The self-awareness to be leamt should focus on autonomy, self-confidence, perseverance, determination, creativity, leadership and flexibility[Timmons, 1978; Homaday, 1982; Brockhaus and Horwitz, 1986; Hisrich, 1986].The know-