Entrepreneurship in Contemporary Times - Term Paper Example

of the of the Concerned 21 October Entrepreneurship in Contemporary Times 1.0 INTRODUCTION Innovation and entrepreneurship are the life blood of any thriving economy. All entrepreneurs are luminaries in the sense that they try to generate wealth by creating something that did not exist before. Hence, it oft involves a complex and tedious process of combining and aligning the existing resources to give way to novel goods and services. Therefore, it is entrepreneurship, which is the procreator of big businesses. No doubt, such endeavors are bound to come across both risks and rewards. In fact, entrepreneurship is not something that is linear and continuous, but rather a process that is fraught with disjointed initiatives and untried strategies (Welsch 21). An entrepreneur is not a surveyor having the apt maps and data at one’s disposal, but rather an explorer that has a hunch that something marvelous exists, at the very next turn. It is about the ability to take risk, about trying new permutations and combinations, about exploiting the till now ignored resources and above all, a willingness to face and manage any possible resistance and opposition (Welsch 32). May sound conservative, but, in a way, all entrepreneurs could be deemed to be destructive. However, it is a destructive attitude with an innovative and creative bent of mind. Certainly, entrepreneurship gives way to innovation, which alters, recombines and realigns the already existing values and way of doing things. All entrepreneurs have a discontented heart. They know that going by the scarce resources at their disposal; it is only creativity and ingenuity that will help them to be a success. So, most of the entrepreneurs shatter the available stereotypes and models of doing business, and replace them with something new and untried (Assudani 197). Therefore, entrepreneurship and a creative rebellion go hand in hand. Truly speaking, an entrepreneur is to be considered an entrepreneur only so long as one is committed to innovation and change (Assudani 197). It is all about recombining and reformatting the available information and resources in ways that escaped the attention, or put to question the gumption of earlier generations. Hence, by their very nature, most of the entrepreneurial initiatives are bound to come across resistance and opposition. In the contemporary times, good business is about creating the right balance between innovation and tradition. While entrepreneurship helps a business break into new and untried grounds, tradition helps keep it on a sound and stable footing. Inability to manage and reconcile innovation and tradition could spell disaster for any enterprise. 1.2 INNOVATION AND ITS IMPORTANCE TO A BUSINESS In the contemporary times, the markets are being inundated with new products and services, which are not only new, but offer features and abilities that are way ahead of what existed before. The digitization of economies and the enhanced usage of the internet and the information technology have exponentially fastened this process. Therefore, it has become imperative for businesses to identify and create new products that could help them beat the thriving cut throat competition. So, in the modern times, innovation has become the number one criteria for success. In that context, innovation has two aspects. One is product development, and the second is the responsibility to imbue organizations with requisite values and incentives that encourage innovation and creativity (Drucker 45). While, the first aspect requires the proliferation of a positive execution capability within organizations, the second calls for an astute and strategic approach towards businesses, backed by relevant processes (Drucker 45). Successful businesses do know that innovation is the one single criterion that is to assure the long term survival and sustenance of their business. Every day, an increasing number of businesses are realizing the ability of innovation to help them wield a competitive advantage in the modern markets. Hence, they are open to innovation in all the aspects of business, be it manufacturing, product improvement, brand building or marketing and sales. The contemporary business environment is defined by a novel kind of dynamism, where customer preferences are not only fickle, but do have the potential to make or break a business. So innovation is the magic wand that could be exploited by businesses not only to cater to altering customer aspirations, but also to radically reinvent and shift customer preferences. 3.0 COMPETITION IN TODAY’S GLOBAL BUSINESS ENVIRONMENT The proliferation of internet and telephony has virtually redefined the contemporary global business environment. The current business environment is defined by accessibility. As, the businesses today are no more localized and rather do not afford to do so, they do not enjoy the benefits extended by a restricted accessibility. Courtesy the multiplication of web portals and online avenues, the number of providers associated with almost all the goods and services has manifold increased. The markets are replete with competitors that could readily offer multiple versions of a single product or service. Under, such circumstances, when there is nothing to debar competitors, when the barriers to market entry have dissolved, the only safe and plausible recourse left for ambitious businesses is to reinvent themselves through innovation and change (Culpan 12). In today’s globalized markets, standardized products and services command a short shelf life. Customer is the king and the thing is that one is aware that out their exist businesses, which are willing to walk an extra mile to deliver an ingenious product or service. So, business competition today is not something finite and localized, but rather a phenomenon that has the capacity to expand and metamorphose in unheard of ways (Culpan 62). Conservative statutes and regulations, backed by vested interests and corruption may restrain innovation at a micro level. However, considering the global business environment, it is almost next to impossible to sustain businesses by strangling innovation and change. There exists tough competition out there in the global markets and for businesses that are willing to embrace innovation and change, sky is the limit. Innovation is the X factor that could help small and start up businesses outdo the big enterprises that turn complacent, courtesy their immense resources and limitless capital. The global marketplace is unbelievably competitive and this competition is here to stay. Even if one goes by conservative estimates, the international trade will continue to grow, at the same rate over the next century, if not more. Going by the fact that developing countries like India and China are realigning their codes as per the global standards and increasing the resources dedicated to enhancing productivity and meeting competition, the global market place has become ultra competitive (Pitofsky: Online). This competition is bound to get more pronounced in the markets associated with technology (Pitofsky: Online). Products and services those are able to embody contemporary ideas and values do easily transcend global barriers, thereby adding to the already tough competition. 4.0 ROLE OF INNOVATION IN BUSINESSES In the current times, business is as much about innovation as about core competencies and in-house expertise. Customers and shareholders expect the business organizations to create value for their money by being open to new and propitious goods, ideas and values. Now, new ideas could not evolve to a great extent from resources and abilities that have gone barren by overuse and overexploitation over the years (Drucker 27). In such a scenario, it is innovation that could play a pivotal role in the conception of new business ideas, processes and products. Innovation enables the business organizations to harness growth and opportunity in the existing and new markets and could really help breath a new life force into a mature business organization. Once considered only the prerogatives of trades and disciplines like science and technology and marketing, innovation and creativity are today the accepted and casual business norms (Drucker 27). New models of manufacturing and production like lean manufacturing stress on reducing waste and tend to define value exclusively in the context of the consumer. Innovation is the tool that could help reduce waste inherent in the existing procedures and systems, thereby adding to the value being offered to the end customer. This definitely makes sound business sense as customers today do intend to pay for the true value they receive, and are averse to paying for the waste inherent in the obsolete systems and procedures of business organizations, from whom they procure goods and services. Besides, ground realities, practical experience, commonsense and varied studies carried over the years have established beyond doubt that innovation and creativity are the ultimate factors, which help business organizations retain a competitive advantage (Drucker 77). An innovative aptitude enables the professionals and business organizations to resort to big picture thinking, leading to the conceptualization of ground breaking strategies, so often marred by a routine approach towards business. Any business leader could almost be deemed to be inefficient and incomplete, without harboring openness to creativity, innovation and change. Innovation helps organizations reinvent themselves by questioning and positively criticizing the set patterns and archaic ways of doing things. It allows the business organizations to enhance and augment their intellectual capital, which is the only master key that would help them retain a competitive advantage. Disciplines that are a bit more directly in contact with the market realities like advertising are more the ever aware of the awesome potency of innovation in global markets. 5.0 CONFLICTS BETWEEN INNOVATION TEAM AND CORE OPERATIONS The companies relying on a traditional mix of hierarchical decision making and vertical communication structures are certainly not proficient at meeting the needs and requirements of innovation and change. Core operations teams used to such mechanisms may often find it cumbersome to adjust to and adapt to the flexibility required by the innovation teams in a business organization (Miner 48). Absence of open and transparent communication between the core operations and innovation teams may further complicate the things. Core operations teams often vie for role clarity where innovation teams thrive on creative confusion and multitasking (Miner 51). Core operations teams mostly comprise of specialists, whereas innovation teams mostly consist of professionals favoring a multidisciplinary and interdisciplinary approach to things. A system of hierarchical control where the employees look for direction, towards their superiors, may be one other area, where innovation teams may not feel comfortable with and at ease (Miner 53). Innovation oriented individuals and team mostly prefer an egalitarian environment, which allows for a free flow of ideas and concepts. On the contrary, core operations teams opt for a work environment that is well defined, structured, hierarchical and bound by set expectations and incentives. Innovation teams do prefer to come out with ideas which create value for the end customer, while the core operations personnel prefer to go for low cost of production and productivity based compensation and reward systems. Innovation minded people believe that it is not the size of a business organization that matters. They understand that creativity can often tilt the balance in favor of a small business. Regular core operations workers respect the size of an organization, premising that it is the large organizations, which generate maximum revenues (Miner 62). This mismatch of values between innovation teams and core operations employees could create grave and serious problems for business organizations. If an organization fails to create just the right kind of work environment, where both types of teams may thrive, it could end up becoming a hapless victim of internal conflicts and organizational friction. This brings to mind a similar situation, when Taiichi Ohno was trying to recreate and reinvent the production system at Toyota. While the conservative production system at Toyota dominated by the core operations personnel believed in continuing with Henry Ford’s supply chain dogmas, preferring the system to be standardized and cost oriented, Ohno, guided by one’s insight into the changing market realities intended to build on Ford’s system, by making the system capable of churning out customized products for specific customers, which extended maximum value to the end user (Womack et al. 36). Ohno differed from other professionals in the sense that he believed in redefining value exclusively in the context of the customer. He knew that the end results of such values will be the creation of a system that believed in delegation of authority and close coordination and cooperation between the varied substructures of the production chain (Womack et al. 22). This called for the discovery and invention of new tools that facilitated the new type of production system envisaged by Ohno. The core operations personnel at Toyota did not understand this concept. Luckily, the top management at Toyota not only supported Ohno’s initiatives, but managed to put in place the requisite synergies between the core operations people and the innovation team. The result is the coming up of Lean Production System, which not only revolutionized the production at Toyota, but allowed the brands like GE and the American Express to reinvent and redefine their business. 6.0 DEALING WITH CONFLICTS The astuteness of a business lies in promptly dealing with and diluting the conflicts arising between its core operations teams and innovation personnel. Most of such conflicts arise because of the inability of an organization to consider and adopt the right values, which get well enshrined in its mission statement (Bacal 22). The fundamental question that the business organizations have to answer today is that do they want to be organization oriented or customer oriented? The former option favors conservatism and hierarchical authority while the later calls for innovation. Contemporary business environment is about creating value for customers through innovation. Not only because the customers are well informed, but also because they have free access to alternate vendors and substitutes. Once, a business organization becomes innovation oriented and value driven, this automatically gives way to the coming up of procedures, systems and substructures within the organization that support innovation and curtail conflicts and irregularities (Bacal 23). So, to get innovative, the first thing that business organizations should work on is their value system (Bacal 22). Once the right values are adopted and promulgated, the procedures and employees at all levels start falling in line. This calls for a strong support for change from the top management in an organization. This eventually gives way to egalitarian systems with the required horizontal and vertical channels of communication. Apt and prompt communication between varied departments in the value stream fosters understanding, cooperation and coordination. The employees start to consider their roles within the system as less rigid and essentially fluid. If one aspect of an organization is rigid while the other is flexible, this is bound to give way to conflicts. However, if all the substructures in a value stream share common values, they are bound to synergize with each other (Bacal 21). This by necessity gives way to reward systems, which are value oriented and not productivity oriented. 7.0 CONCLUSION Innovation and creativity are the ultimate weapons in the arsenal of any organization, determined to get competitive. However, innovation is a concept that does not go well with traditional and conservative organizational values. This mismatch of organizational aspirations gives way to conflicts at all levels. So, organizations determined to support innovation should not overlook the need for compatible values and choices. Once the values are taken care of, it by necessity gives way to the requisite systems and procedures, which minimize conflict and promote synergy, cooperation and coordination at all levels in an organization. Word Count: 2,507 Works Cited Assudani, Rashmi H. “Ethnic Entrepreneurship: The Distinct Role of Ties”. Journal of Small Business and Entrepreneurship 22.2 (2009): 197-198. Bacal, Robert. “Organizational Conflict: The Good, The Bad and The Ugly”. The Journal for Quality and Participation. 27.2 (2004): 21-25. Culpan, Refik . Global Business Alliances: Theory and Practice. Quorum Books: London, 2002. Drucker, Peter F. Innovation and Entrepreneurship: Practice and Principles. Harper & Row: New York, 1985. Miner, John B. Organizational Behavior. Oxford University Press: Oxford, 2002. Pitofsky, Robert. “Competition Policy: Global Economy, Today and Tomorrow”. Federal Trade Commission. 4 November 1998. US Federal Trade Commission. 24 October 2010. Welsch, Harold. Entrepreneurship: The Way Ahead. Routledge: New York, 2003. Womack, JP., Jones, DT. & Ross, D. The Machine that Changed the World: The Story of Lean Production. Harper Perennial: New York, 1991. Read More