(The final*
instalment of
excerpts from the
upcoming book Natural Enterprise.
)
 The
hardest part of entrepreneurship is getting the business up and
running. Perhaps the second hardest is deciding when to let it go.
Consultants will tell you every business has four stages in its
life-cycle: Start-up, Early growth, Maturity, and Decline. They'll draw
you a sigmoid (S-shaped) curve to illustrate it -- a long slow start,
then a surge as it catches on, then levelling off, and finally
dropping. That curve represents revenues and profitability, but it
often tracks closely with the passion of management and public markets
for the business as well.
How does this apply to a Natural Enterprise which, almost by
definition, is not focused on growth, but rather on well-being of its
member partners, and on sustainability? The experts suggest that a
company that is continually innovating can pile one of these 'S' curves
on top of another, and theoretically grow at a reasonably fast pace
forever. Innovation is equally critical, as we have seen, in
entrepreneurial businesses, but its purpose in these businesses is
somewhat different: to (a) discover new unmet needs that replace
products and services that are no longer needed (or have been obviated
by other companies' disruptive innovations),
(b) discover new applications and markets for the products and services
you already offer, and (c) continuously improve your products and
services as you understand more deeply both the customer's needs and
the solution alternatives. This is a process that offers entrepreneurs
a tremendous competitive edge over large corporations, which get very
attached to, and defensive of, existing products and services (in which
they are heavily invested), and hence are loath to change. The
pressures of meeting public shareholder expectations also makes large
corporations short-term focused and less willing and able to
incorporate radical innovations that can 'cannibalize' existing
offerings and cut into short-term profits.
So while the large corporation uses a mix of innovation, massive
marketing, acquisitions and globalization to try to sustain growth as
long as it can, and eventually and inevitably goes into a phase of
permanent decline, divestiture or absorption into a newer, growing
organization, more agile entrepreneurial businesses can stay healthy
indefinitely, provided they
don't grow too large, cease to be innovative or succumb to the lure of
low-cost capital through public ownership. If the large corporation is
the 'dinosaur' of the business world (big, rapacious, hugely successful
but doomed to die), the entrepreneur is more analogous to a community of small animals, sustaining itself indefinitely as long as it doesn't succumb to an 'ecological' catastrophe.
While competent entrepreneurs need not, therefore, worry
about either the problems of rapid growth or the problems of inevitable
decline, it doesn't necessarily follow that the enterprise should
aspire to live forever. Here's where the elegance of self-managing
systems shows itself to best advantage: The members of a Natural
Enterprise vote with their feet if and when the organization no longer
meets their needs. There's no need to plan for the sunset of the
enterprise because it will happen organically if and when its members
choose to dissociate from each other, naturally.
Most entrepreneurs strive, usually without success, to put in place a
succession plan, to encourage either family members or key employees to
'buy them out' when they're ready to retire. Why don't these plans
work? Two reasons: (1) to some extent the entrepreneur is
the enterprise, he or she represents it to its customers, and has so
much of the wisdom, the intellectual capital of the enterprise caught
up in his/her head that its value to someone else, even a child of the
entrepreneur, is often negligible, and (2) it's hard to transfer the
passion of the enterprise to someone who wasn't part of its inception
and life-long realization -- most entrepreneurs, unless the price is very low, would sooner start their own business than take on someone else's with all its 'baggage'.
Natural enterprises don't have to worry about succession -- they add
and lose members organically as the needs of the business and the
competencies and needs of the members evolve. Natural enterprises have
no shares and no hierarchy to worry about transitioning, and the
concept of 'retirement' doesn't apply -- if a member's needs change
such that he wants to spend less time on enterprise activities, he
simply declares this to his partners and they will, using the
self-management techniques outlined earlier in this book, re-jig the
mix of members and roles (and if necessary identify and invite someone
new to join) organically to compensate. If you're in an organization
with people you love, doing work that you love, why would you ever
abruptly and completely 'retire' anyway? Just as an old goose never
'retires' from the flock, but just transfers responsibilities to others
in the flock as needed, the concepts of retirement and succession just
don't apply.
The global business community, setting aside the somewhat artificial
constructs of large multinational corporations -- hierarchy, oligopoly,
unequal distribution of resources, propensity to bribery and
corruption, lack of responsibility for others' well-being etc. -- meets
the definition of a complex adaptive system. It's complex, rather than complicated, because it's impossible for anyone who know everything
about it, or even everything needed to make a significant business
decision. Like an ecosystem, the global business community (again,
ignoring the corporate dinosaurs) is non-hierarchical and
self-organizing, and despite the fact no one is 'in charge', certain
decisions and behaviours that work very well tend, in an evolutionary fashion, to emerge
over time (which is why complex adaptive systems are sometimes called
'emergent' systems). Using a combination of self-adjustment (in
self-interest) and instinct, like flocks of birds that swirl in the air
like a single organism, and stay in perfect formation during migrations
of thousands of miles that, thanks to the 'collective intelligence' of
the flock, take them precisely
to their nesting grounds each year, entrepreneurs and their customers
comprise an adaptive commercial 'ecosystem'. More than any other factor
it is this attribute, this elegant capability to do the right thing
almost perfectly, collectively, every time, that makes Natural
Enterprise -- natural.
And that brings us to the end of our journey.
[I'll be putting a brief re-cap of the entire book, and the key things to remember, here, when it goes to press]
It is my hope that the purchasers of this book and other entrepreneurs
will take advantage of the Internet, and particularly the new and
evolving social networking tools, to learn much more about Natural
Enterprise and about entrepreneurship in general from each other, than
I could ever hope to teach in this one volume. To that end, I have
created (I'll do this soon, and blog about it)
the Natural Enterprise Forum. Readers are welcome to use it to pose
questions or comment on this book, or to tell their personal
entrepreneurial stories (to give other readers all-important context)
that capture your learnings, good and bad, about entrepreneurial
business. I'll be active on this site.
In addition, through my business Meeting of Minds (website for this also going up shortly), I
can offer entrepreneurs, Natural or otherwise, guidance, advice and
coaching on a wide variety of business-related matters, especially
business innovation. Pricing and contact information may be found in
Appendix Two.
* Table of Contents for Natural Enterprise: Making a Joyful Living with People You Love
(each chapter will be edited for book form, additional material will be
added to some chapters, a bibliography will be appended, and about 50
'mini-case studies' of entrepreneurial best -- and worst -- practices
will be included throughout the book.):
|
MADE IN CANADA
trust your
instincts 
