Entrepreneurs have become the new heroes of the business world.
At Harvard Business School, even students who plan to join blue chip firms and have no intention of ever launching start-ups would be insulted if someone told them they weren’t “entrepreneurial.” And this is why: Entrepreneurialism is highly valued in today’s labour market. Companies of all shapes and sizes aspire to be seen as highly innovative, nimble, and agile—all qualities traditionally ascribed to entrepreneurs.
Yet in their recruiting efforts, companies do not have a scientific way of separating true entrepreneurs from other talented candidates. Instead, they fall back on broad stereotypes.
But what is Entrepreneurial Leadership?
In 2004, Chris Roebuck defined entrepreneurial leadership as “organizing a group of people to achieve a common goal using proactive entrepreneurial behaviour by optimising risk, innovating to take advantage of opportunities, taking personal responsibility and managing change within a dynamic environment for the benefit of [an] organisation”.
Entrepreneurial leaders may work within a formalised organisation structure. But they use the skills and approaches associated with successful entrepreneurs.
Why do we need Entrepreneurial Leadership?
The answer is relatively simple. To keep up with the swift pace of change in the world, we need forward thinking, creativity and innovative ideas.
In today’s fast-changing world, leaders need to be agile. You need to be able to make decisions quickly, take action and learn from the results. You need to anticipate the future, respond to unforeseen circumstances and adapt to change.
That relies on entrepreneurial leadership.
In other words, entrepreneurial leadership is like white water rafting. To ride the waves of change, you need a strong sense of purpose and motivation. You need a committed and effective team. And you need the agility to respond quickly and change direction when needed.
And for that reason, entrepreneurial leadership is not just for start-ups. It’s for all organisations.
Some of the common entrepreneurial leadership characteristics are as follows.
- Communication skills
The leader is able to clearly articulate their ideas, and the plan to achieve common goals. They encourage communication between departments and across levels. They avoid ambiguities and generalizations, and are able to avoid conflict and misunderstanding due to poor communication.
A successful entrepreneurial leader has a clear vision. He knows exactly where he wants to go and how to get there. They communicate their vision to the team and work with them to make the vision a reality.
An entrepreneurial leader realizes the importance of initiative and reactiveness, and they go out of their way to provide all the support that the team needs to achieve their goals. The leader usually does not punish employees when they take a calculated risk which misfires. Instead, they sit down with employees to analyse what went wrong and work with them to correct the mistakes.
The leader has tremendous belief in themselves and has confidence gained from years of experimenting, at times failing, and learning. They are aware of their strengths and weaknesses, and demonstrate their skills without hubris. An entrepreneurial leader is very self-assured.
- Shares success
When the team or the organization succeeds at something, the leader does not hog the limelight or take all the credit. They acknowledge the contribution of others and share the accolades with them.
You will not find an entrepreneurial leader cooped up in the office. Leaders like to spend time among employees, walk around the factory or department, interact with everyone, and see them doing their job. This leader will usually take some time out to informally chat with employees, and understand their work and personal challenges.
- Create an atmosphere conducive to growth
With a deep understanding of the importance of other people’s contribution to organizational success, the entrepreneurial leader creates an atmosphere that encourages everyone to share ideas, grow, and thrive. They actively seek other’s opinions, and encourage them to come up with solutions to the problems that they face. The entrepreneurial leader also provides positive feedback when employees come forward with an opinion.
Honesty is the most important quality of an exceptional leader. Entrepreneurial leaders who are honest are able to quickly win the trust of their employees. People respect leaders to come across as honest, and are more likely to accept positive or negative feedback and also work harder.
When the going gets tough, the entrepreneurial leader perseveres. True entrepreneurs simply don’t quit, they keep going till they find what they’re looking for.
The leader not only invests significantly in learning and updating their knowledge, but they also create a learning environment in the organization encouraging others to improve their knowledge, widen their experience, and tackle multiple challenges. They encourage employees to think outside the box and come up with creative solutions to problems.
No matter what context you’re operating in (organisational change, new venture, setting up a family business…), entrepreneurial leadership will be central to your growth. Developing leadership skills helps develop talent, roll out new products and services, deliver efficiency and gain market share.
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