All Articles Leadership Live with @Babson: What’s blocking entrepreneurship in organizations?

Live with @Babson: What’s blocking entrepreneurship in organizations?

4 min read


SmartBrief welcomed association partners to its office Wednesday to join in an interactive workshop on encouraging entrepreneurship in organizations. The session was led by Babson College President Len Schlesinger and entrepreneurial-studies professor Heidi Neck.

After explaining Babson’s research-based six steps leaders can take to encourage entrepreneurship in organizations, Neck and Schlesinger led attendees in a brainstorming session to come up with ideas for practical actions organizations can take to complete those six steps. Each table of attendees came up with some good suggestions, but everyone expressed doubt that the suggestions would work in their organizations because they run counter to the organizations’ cultures.

Culture is a big problem in getting people to act like entrepreneurs within a large organization, said Schlesinger and Neck, who explained that there are at least three pervasive beliefs in large organizations that make it hard for entrepreneurship to blossom and thrive.

  1. Employees who act as entrepreneurs within organizations stand out but get fired when they fail. Unfortunately this is often the case within traditional organizations where the culture leaves little, if any, room for trial and error. Knowing how often this is the case holds employees back from acting entrepreneurial and risking failure.
  2. Organizations that encourage entrepreneurship are only training their employees to leave and take other jobs. Research has shown this just isn’t true. Employees don’t move on because they’ve been given training and opportunities that encourage entrepreneurship on the job.
  3. Leaders are at the top of organizations because they have all the answers. It’s extremely difficult for a senior leader to “open up their shirt and acknowledge they’re not Superman,” said Schlesinger. By the time people reach the upper levels of organizational leadership, they have scored well on the SATs, gotten into college, graduated from college, been hired for jobs and risen through the ranks because they had the right answers, which makes it hard to admit to not knowing something. Still, to encourage entrepreneurship within, organizations need leadership that’s willing to say “I don’t know, but gee I would like to,” said Schlesinger.

One SmartBrief association partner in attendance shared her positive experiences with an executive at her organization who is willing to admit when he doesn’t know something. When he first came to the job, he asked people to call him by his first name and said, “I’m not always right, and I welcome all of you to let me know when I’m off base.” Those might have just been words, but he really changed the organization’s culture by following them up with concrete actions — really being open and listening to peoples compliments, criticisms and suggestions, she explained.

When senior leaders legitimize lack of knowledge by admitting what they don’t know, asking questions and getting curious people in the organization to go find answers to those questions, they help encourage entrepreneurship and set the stage for making valuable discoveries, said Schlesinger.

He offered an example from the business software company Intuit, which took a handful ideas its senior leaders firmly believed to be true and put groups of creative employees together to find out which were true and which were actually false. Each group got $1,000 and time to test the ideas.

It turned out 89% of the hypotheses were wrong, and senior leaders didn’t really have all the answers — a valuable lesson. Also, the 11% of hypotheses that were right brought Intuit a lot of value.

So with a very small amount of money and a relatively short amount of time — an easy-to-swallow amount of risk — Intuit weeded out a lot of bad ideas and pinpointed a few valuable ones. Instead of looking at the 89% of wrong answers as failures, Intuit saw the whole process as a success that helped take the company in a smart, strategic direction.

Does your organization’s culture make it hard for employees to act as entrepreneurs? If so, how does it need to change? If not, what is it doing well?