9 stages, Blog, Entrepreneurship Theory, Inclusive Entrepreneurship, Skills Development

The entrepreneurial network – selecting yours

One of the least understated resource which any budding entrepreneur needs is a personal entrepreneurial network. When I run business startup programmes, the truly lasting resource they gain is a network of like minded people. The skill learnt is to be able to find out a common fact within 60 seconds and engage that person on a entrepreneurial level and is one of the first skills we learn as entrepreneurs.

There are numerous entrepreneurial networks offering different types of resources to start or improve entrepreneurial projects. However when selecting a network what is the criteria you should use to make you decision. Here are seven traits to look for.

Social capital

When we look at social capital with entrepreneurial networks, we see a number of factors which highlight the importance of the network and the development of trust. A number of researchers have underlined the importance of networks and social capital (Aldrich-Zimmer 1986, Burt 1992, Adler-Kwon 2002). There are numerous definitions of social capital, but the most appropriate one is ‘features of social organization such as networks, norms, and social trust that facilitate coordination and cooperation for mutual benefit’ (Putnam 1995, p. 67). What social trust does the network promote?

Collective Self-Efficacy

Collective efficacy refers to a group’s shared belief in its conjoint capabilities to attain their goals and accomplish desired tasks (Bandura, 1986). The network should want to collaborate in collective action to address the problems within the group. This mean the continue mutual benefit should remain through the stages of enterprise development. So how will you get the most out of this network while you grow? What can you provide to the group and what will they provide you?

Social Organization

The network should be organized with rules, routines and opportunities to engage with every member. According to Shane and Venkataraman (2000) the domain of entrepreneurship is a connection between opportunities and enterprising individuals. This connection within the network needs to be organized for it to be effective for you as a member. Look for network which provide these connection opportunities within its social structure.

Entrepreneurial set of norms

The entrepreneurial network has a set of norms which will help define the enterprise development,  the business opportunities, the skills and the opportunities for future enhancement of the entrepreneur. What are the set of norms you will need?

  • Innovation – Combined with leadership, the entrepreneurial network is an indispensable kind of social network not only necessary to properly run the business or project, but also to differentiate  itself.
  • Beliefs  – Social beliefs are the expectations around which we organize daily social life. They allow us to put order into the world around us through kinship and social values. Does the network fit with your beliefs?
  • Behaviors – The behavior traits such as dominance, extrovert, patience and conformity will be held within the group. Does it contain the right mix for your success?
  • Routine –  In general, entrepreneurs manage the risks around them by developing procedures and routines that enable them to access a suitable solution when a problem arises (Edvinsson and Malone 1999; Roos et al. 2001). If you have a regular access to the group, they can form part of you risk reduction strategy.

Size of Network

The network should have the diversity of people but also be large enough for you to constantly finding new people and opportunities. However your person network should be solid enough for people to know you well enough to interact with and provide and receive opportunities. The critical elements of the network are nodes, (members) and links (relationships) (Gartner 1988, Burt et al. 1994, Lipnack-Stamps 1994). So

  • How well do you need to know someone to consider them part of your network?
  • How many people can you consider to part of your network?

The network should be at ten times larger than this number. This allows for you be able to develop as a business owner and also find new people to discuss the entrepreneurial mindset.

Diversity of Membership

The importance of a diverse range of members in the network important in being able to quickly gain adequate human resources to fulfill the entrepreneurial achievements. These fit into the following groups.

  • Business Services: Lawyers, Accountants, Marketing, Sales
  • Co-Founders: Technologists, Scientists, Engineers, Business managers
  • Client & Suppliers
  • Partners – high skilled employees, mentors, investors

Online Network

The internet provides a faster and more reliable method of connecting and sharing with others. Therefore we see more entrepreneurial networks, both on dedicated sites and also on the main stream social networks such as twitter, Facebook and also Linkedin.  Twitter is many groups of people who are dedicated to enterprise providing the information which is needed to start and develop a business.  Linkedin has many groups which debate and connections can be developed to share business ideas and opportunities.

Chamber of commerce – http://www.britishchambers.org.uk/

Federation for small business http://www.fsb.org.uk/

Institute of directors – http://www.iod.com/

Enterprise Nation – http://www.enterprisenation.com/

NACUE – http://www.nacue.com/

Shell Livewire http://www.shell-livewire.org/

Sandbox – http://www.sandbox-network.com/

 

Blog, Experiential Learning, Legal and Regulatory Knowledge, Skills Development

Why is student led enterprise so important?

It is universal accepted by policy-makers, businesses and academics that entrepreneurship is an essential skill for the survival and advancement of both large and small businesses. Therefore, an important skill to obtain whilst at university or college. There is also strong evidence exists that educational programmes in entrepreneurship have a positive effect on developing individuals’ entrepreneurial attributes (The Impact of Entrepreneurship Education on Entrepreneurial Intention), raising awareness of career options in entrepreneurship and advancing a positive attitude towards entrepreneurship.

However, its in the extra curricular activities that the students mindset is developed, through empowerment, self actualization and the further development of the entrepreneurial mindset. This is bore out with the wikipida definition of Entrepreneurship which is the act and art of being an entrepreneur or one who undertakes innovations or introducing new things, finance and business acumen in an effort to transform innovations into economic goods.

This means that the development of the entrepreneur is through experimentation, the tried and tested process of trial and error, with reflection and fine running at each stage. Never giving up but also taking a clear judgment of the progress and opportunities. This was presented by Peter Honey and Alan Mumford’s model (based on David Kolb’s model of experiential learning  http://en.wikipedia.org/wiki/Learning_styles).

This is why student led societies are so important in the development of enterprise within our universities and colleges.  If we list of attributes of an entrepreneur we can start to see why Societies are great places for the development of these skills and why employers should be looking for these students.

1. Ambition. Society leaders not only want to be successful, they need to be successful, driven by the ambition they put in 70 hour weeks. They are obsessed by their sports, the goals of the society (RAG, http://en.wikipedia.org/wiki/Rag_%28student_society%29) and also driven to ensure they will leave the society in better shape than any previous leader.

2. Persistence. Failure is not an option. However learning from your mistakes, failures and the continual persistence to drive forward to create a winning team. I see societies such as the Eco-House Initiative (http://www.ecohouseinitiative.org/ who gained RBS ESSA Accreditation) who are trying to fix major world problems whilst still a student society.

3. Creativity. Solving problems is the name of the game. Developing solutions for life’s problems creates opportunities , if its trying to run five minibuses for the team, developing a speaker series (http://manchesterentrepreneurs.org.uk/events) of successful entrepreneur on no budget or organizing twenty committee members to be in one place.

4.  Tenacity. Everyone learns to the walk the same way, you try to stand, fall over, try again, fall over again and continue with this, many many times until you get it right. You know you will succeed, everyone around you walks. So just be stubborn and get on with it. Again sports teams know this, other societies learn it over a period of time.

5. Risk tolerance. Life is full of risks, we survive by learning to gauge, understand and control these to an acceptable level. However, it’s the tolerance to risk which is personal, some people like to take larger risks than others. So standing for president of a society may be too risky for some, as failure and ridicule are too much to handle. Others will see this as an opportunity to promote themselves and get to know a wider social circle which ensures the have a more powerful network. The management of the society also handles risk as any other business, and this learning within a society is invaluable when applied to business.

6. Personality. People like people who like them, so developing your personality whilst at university is, some will say the only reason, the main reason to go to university. Whilst some of the most successful entrepreneurs are geeks, the majority of successful people have a great personality, which engages others. In most societies the leaders are voted in and therefore presenting and conveying your personality is important for a successful outcome.

7. Communications. In a worlds with several social media channels (Facebook, Twitter, Google+, pin interest, Youtube..) and emails coming in from all directions, the average student is very difficult to get hold of. The importance is understanding the medium which works with your community and putting in a way your audience understands.

8. Leadership. While an entrepreneurial leader organizes and assumes the risk of his or her society, there will likely be others who follow to help make the society a success, typically a management team. Managing members and key team members is an important ingredient for a successful entrepreneur. Motivating the team to take 400 students on a skiing trip (http://theessa.com/case-study/skum-2/#.UV6aFxlAuBU) might sound easy but the research, planning, resource allocation and responsibility can not be under estimated.

9. Adaptability. The average society has around 200 members from numerous schools which run their own timetable. Change is inevitable and is the only constant in an evolving world. An entrepreneur leader will adapt to technology, market trends, financial pressures and their customers/members. Those that have tried to organize students will know that adaptability is the core skill.

10. Intuition. Understanding the trends and having an idea of what people want without doing a market survey (Steve Jobs never did one market survey) will allow our entrepreneurial leader to have a vision which others can only buy-in to and also have to follow.

This is why being part of a society is so important in developing student enterprise and also creating an entrepreneurial environment for students to learn and tune these valuable skills. Enterprise Societies can help create this space for student reflection on their extra curricular activities.

 

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The virtual enterprise industry, where is the SIC for it?

In a week where we have had a new budget and Virtual Enterprise Conference in the same week, I think its about time we reclassified our industry into two classes. Virtual and Others under the SIC.

Yes we should be encouraging people to start virtual businesses whereby from day one they are selling to others around the globe. You should be given help to start making use of the internet and servicing businesses in Afghanistan, Iran and the Sudan without ever burning carbon miles to get there yourself and be in harms way.

All you have to do is pay all your taxes here. You don’t even have to warehouse in the UK, just pay your taxes.

So what would be in my new Virtual Business Classification

 

Creative Industry

The Creative Industries accounted for 2.89% of gross value added (GVA) in the UK in 2009 . Relative to the UK’s total GVA, the Creative Industries GVA has increase by 0.07% (from 2.82% in 2008), but in absolute terms the GVA reduced by 1% from 2008 (£36.6 billion to £36.3 billion) . Music & Visual and Performing Arts account for the largest contribution to the number of  businesses (1.46% of the UK for enterprises and 1.21% of the UK for local units in 2011). Publishing alone bring in £11b.

At the moment this is put into Arts, Entertainment, Recreation and other services. Yes a sector which brings in £36.6 Billion is under other?

 

Retail

Wholesale and retail trade continued to show strong growth in 2011 where UK exports rose by 65% from £8,609 million in 2010 to £14,176 million in 2011 (compared with a 26% increase in 2010). Total UK exports of merchanting, other trade-related and services between affiliated enterprises increased by 30% in 2011 rising from £17,254 million in 2010 to £22,356 million in 2011 (compared with relatively small growth of 11% in 2010). This may indicate a shift in UK exports patterns favouring merchanting, other trade related and services between affiliated enterprises.

 

Professional & Online services

This would be a new sector which bring together professional services, website services, telecommunication, email, social media and others. The virtual services sector is a massive growth sector and we need to give it the space and opportunities to take over the world . The Professional, scientific & technical is currently a category, M. Some healthcare could be put in this category. Create an industry Czar and promote it around the world, we are the virtual services hub of the world.

 

Finance And Insurance

This sector brings in £14B a year to the UK economy. As a sector its a very profitable part of the economy and we should ensure we are the bankers of the world. Money is only a number in a computer and therefore we should consider it a major part of our virtual economy.

 

Education

This is such an important industry for the UK, it now needs to focus on teaching the entire world, just as the BBC is a proved provider of news, UK Universities and Colleges needs to be the trusted providers of physical and virtual learning. We currently have 302,000 students from other countries, this should be 10 times this and another 1,000 times using virtual course. Currently category P.

 

Others would include

Agriculture, forestry & fishing A
Production B, C, D and E
Mining, quarrying & utilities B, D and E
Manufacturing C
Construction F
Repair of motor vehicles G
Motor trades G
Wholesale G
Transport & storage (inc postal) H
Accommodation & food services I
Property L
Business administration and support services N
Public administration & defence O
Health Q
Arts, entertainment, recreation and other services R, S, T and U

 

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Good governance is good entrepreneurship

Over the last five years we have learnt how entrepreneurship can lead us down the wrong road. Having entrepreneurial bankers risking our saving is not a good place to be. I also watched Manchester United lose at home in the champions league and it was expected given the events of the last five years. Football lacks good governance, everyone knows this from the top (who enjoy great wealth from the game) to the bottom whereby fans get to see there teams spend every more money in creating spectacular entertainment. The same is in in many religions.

As an entrepreneur, having to report to a group of people who may or may not agree with you is a major issue which you will try to tactically eliminate. However it is important to hear the truth, however hard from those who you trust and not from the fans, shareholders and voters. These three groups will never ever be pleased and therefore if you are pleasing them now, you are in about to fall. The independence  of others ensures your success, this is why mentors are so worth their weight in gold.

This is one of the reasons I agree with more woman on the boards of companies, also diverse educational mixes. It reduces the group think and ensures a healthy debate occurs on all subjects before moving to a consensus. This is one of the major parts of good goverance, a diverse range of views who provide guidence, knowledge and thought behind every decision you make.

The banks have failed to engage diverse educational background into there management stuctures which led to no one pointing out the obvious. i.e. Should we be investing in this at this time?

The NHS have failed in Staffordshire becuse of the same reason. Everyone was happy to get their wage and not question, why are these people dying and how can be make this better?

The same happens in government, small businesses and multi-national businesses. Its common as people like people who like them. We don’t like people to question us, we like people from our tribe (university, ethic group, gender or golf club), if we and everyone else is happy why should we ask for change?

The fact is we all have to be entrepreneurs, and this is what entrepreneurs do, look at the system and say, I’ m going to make this better. It may be painful, risky and I am not going to be liked for saying this, but the world is going to be a better place after i have done this.

And once I have done this, I willl ensure others have the opportunity to question me and make me continue on this path, never ever giving up because I have won this one battle. Afterall being an entreprenur is a war against complacency.

Talking About Entrepreneurship