Entrepreneurial DNA

Chapter 2
Entrepreneurial Transformation

LEADERSHI
P
CULTURE STRATEGIE
S

STRUCTURE
S
 Entrepreneurial Transformation

Replicating within the company:

• The entrepreneur’s character traits
• Their approach to managing change
through uncertainty

DNA
 Owner-managers’ DNA

• Need for
independence
• Need for L
achievement A
V T
V I C
• Internal locus of R IN
control SU ST
• Able to live with IN
risk and
uncertainty
 Entrepreneurs’ DNA

• Opportunistic
• Innovative
• Self-confident
•
TH T
Driven & determined W C
O
R TIN
• Visionary with flair G S
• Able to live with greater IN
risk and uncertainty
 Antecedent Influences on Start-
Ups
• Education
• Employment and unemployment
• Family
• Immigration
Factors Associated with Growth Firms

• More likely to be set-up by a group

rather than an individual
• More likely to be set-up by middle aged
(or very young?)
• More likely to be set-up by experienced
managers
 General Enterprise Tendency Test

• nAchievement - max 12, average 9 (75%)

• nAutonomy - max 6, average 4 (67%)

• Creativity - max 12, average 8 (67%)

• Risk taking - max 12, average 8 (67%)

• Drive/determination - max 12,

average 8 (67%)
 Achievement
With a score over 9 (75%) you are likely
to exhibit the following qualities:
•Forward looking
•Self sufficient
•Optimistic rather than pessimistic
•Task orientated
•Results orientated
•Restless and energetic
•Self-confident
•Persistent and determined
•Dedicated to competing a task
 Autonomy
With a score over 4 (67%) you are likely
to exhibit the following qualities:
•Likes doing unconventional things
•Prefers working alone
•Needs to do their ‘own thing’
•Needs to express what they think
•Dislikes taking orders
•Likes to make up their own minds
•Does not bow to group pressure
•Is stubborn and determined
 Creativity
With a score over 8 (67%) you are likely
to exhibit the following qualities:
•Are imaginative and innovative
•Have a tendency to daydream
•Are versatile and curious
•Have lots of ideas
•Are intuitive and guess well
•Enjoy new challenges
•Like novelty and change
 Risk taking
With a score over 8 (67%) you are likely
to exhibit the following qualities:
•Act on incomplete information
•Judge when incomplete data is sufficient
•Accurately assess your own capabilities
•Be neither over nor under-ambitious
•Evaluate likely benefits against likely costs
•Set challenging but attainable goals
 Drive & determination
With a score over 8 (67%) you are likely
to exhibit the following qualities:
•Take advantage of opportunities
•Discount fate
•Mack your own luck
•Be self-confident
•Believe in controlling your own destiny
•Equate results with effort
•Show considerable determination
 How Entrepreneurs Manage

• Relationships

• Strategy

• Risk
 How Entrepreneurs Manage

• Develop informal
relationships with
customers, staff & P S
I
suppliers
S H
• Manage staff through N
IO
relationships rather than A T
structures E L
R
• Use relationships to
build networks
Entrepreneur’s Spiders Web

Entrepreneur
Entrepreneur
Entrepreneur’s Spiders Web
New
employees
continue to
report to the
entrepreneur
informally

Entrepreneur
Entrepreneur
 How Entrepreneurs Manage

• Strong vision
• Develop strong
strategic intent Y
• Continuously E G
A T
strategizing R
• Develop strategic ST
options
 Strategy Formulation

Growth Emergent strategy

Emergent strategy
formulation formulation

Crisis Consolidation

Deliberate strategy
formulation
 How Entrepreneurs Manage

• Mitigate risk through

information &
knowledge
• Develop networks to
generate this & spread SK
R I
risk
• Compartmentalising
risk & incremental
decision making
 How Entrepreneurs Manage

• Relationships

• Strategy

• Risk
 Effectual Reasoning
Entrepreneurs:
• Evolve strategy based on
opportunities & personal strengths
• Set ‘affordable loss’ & go to the
market quickly, learning by doing
• Do not like formal research & believe
they can influence the future by
developing contingencies
• Partner with other stakeholders
• Are less concerned by competitors
 Greiner’s Growth Model

STAGE 1 STAGE 2 STAGE 3 STAGE 4 STAGE 5

5: ?
Large Evolution stages 4: Red Tape
Revolution stages
3: Control
5: Collaboration
Size Crisis of:
2: Autonomy 4: Co-ordination

1: Leadership
3: Delegation
Small
2: Direction
Growth
through:
1: Creativity
Young Mature
Age
What is an entrepreneur?

1. How many elements of entrepreneurial

DNA can you spot in Steve Jobs?
2. Was he a great entrepreneur?
3. Do you have to be a likable character?
What elements in the DNA might
trigger his behaviour?