Jul 24, 2024
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The business world is rapidly evolving. Successfully navigating it requires progressive thinking, creativity, and innovation. And whether you’re in the early ideation phase of your entrepreneurial efforts or already running a successful startup, your leadership skills can make or break your business. Because as you know, running a small business is not just about ensuring that you meet your goals but also about positioning your staff to rise to the occasion — and your customers to respond positively. This article explores what kind of skills an entrepreneur may need to be a successful leader.
British economist and transformational leadership professor Chris Roebuck defines entrepreneurial leadership as “organizing a group of people to achieve a common goal using proactive entrepreneurial behavior by optimizing risk, innovating to take advantage of opportunities, taking personal responsibility and managing change within a dynamic environment for the benefit of [an] organization.”
So let’s break that into 8 actions entrepreneurs must regularly take:
To further paint a picture of an entrepreneurial leader, leadership development expert Antoinette Oglethorpe compares entrepreneurial leadership to white water rafting. To stay afloat in challenging and unpredictable currents, you need purpose, agility, comfort with risk, creativity, and motivational abilities. These same qualities apply to successfully leading a business enterprise in uncertain times.
And while many people think of entrepreneurial leadership primarily in the context of start – ups, entrepreneurial leaders operate in many other business contexts, including social ventures, family enterprises, and innovative organizations, Oglethorpe points out.
Entrepreneurial leaders aren’t content to coast on the status quo. Rather, they’re always on the lookout for new opportunities to innovate and improve. And while traditional leadership methodologies emphasize minimizing risk by adhering to processes and procedures, entrepreneurial leaders understand the value of risk — and understand how to strategically manage it.
Entrepreneurial leadership is accompanied by many benefits, including the ability to quickly adapt in dynamic situations; to drive change, both for companies and industries; to devise innovative solutions that help companies remain competitive; to build resilience in uncertain environments; and to set more ambitious, yet attainable, goals.
It takes hard work and dedication for someone to become a successful entrepreneur, so knowing where to spend your time is important. What are the most valuable entrepreneurial leadership qualities for business owners? Here’s a look at 9 common traits found in successful entrepreneurial leaders. Notice as you read how many of these qualities interrelate and build on one another.
Communication is a paramount skill for all leaders. However, it’s especially vital for entrepreneurial leaders, who must be able to convey their ideas to others and to motivate them to follow — often into uncertain territory.
In addition to communicating their own ideas, entrepreneurial leaders must effectively facilitate productive communication between other team members. Take Tesla titan Elon Musk, for example. SpaceX talent acquisition manager Dolly Singh says of Musk’s powerful ability to communicate, “His vision is so clear. He almost hypnotizes you. He gives you a crazy eye, and it is like, yes, we can get to Mars.”
Of course, communication isn’t just about sharing one’s own ideas; it’s also about listening to others’.
Entrepreneurial leaders tend to be hands – on and work directly by uniting people and teams. They know that success hinges on everyone working together and position themselves as part of that team effort. This also helps them build an engaged team.
Just as they’re aware of their own strengths, they’re also aware of the strengths of others — and how to use them to achieve desired outcomes. They know exactly who among their team to tap for each role and who has a budding skill they can grow. In his book, Winning, Jack Welch, former CEO of General Electric, wrote, “If there is anything I would like to be remembered for it is that I helped people understand that leadership is helping other people grow and succeed. Leadership is not just about you. It’s about them.”
Growth mindset is the outlook that knowledge, skills, and talents aren’t “fixed” — rather, they can be learned with focus, practice, and persistence. A major tenet of growth mindset is the belief that failure is instrumental to success because it’s part of the learning process.
Google co-founder Larry Page is one excellent example of how a growth mindset works: “My experience is that when people are trying to do ambitious things, they’re all worried about failing when they start. But all sorts of interesting things spin out that are of huge economic value. Also, in these kinds of projects, you get to work with the best people and have a very interesting time,” Page once explained.
This outlook was shared by Indra Nooyi, former chairperson and CEO of PepsiCo., and the first woman of color to run a Fortune 50 company. “I use failures as learning, teachable moments about what went wrong, and what I could have done better, then I learn from that and improve next time. Without failures, I wouldn’t be where I am today,” she says.
Entrepreneurial leaders are curious types who wonder about new and better ways of doing things.
According to Francesca Gino, an award – winning expert on the psychology of organizations, curiosity is essential to organizational success for several reasons, including that it helps leaders and employees adapt to uncertainty and pressure.
“When our curiosity is triggered, we think more deeply and rationally about decisions and come up with more – creative solutions,” Gino proposes.
Furthermore, curiosity inspires employees to seek out more collaborative relationships — and to develop trust in those partnerships.
Comfort with fluid circumstances and inexactitude is what allows entrepreneurial leaders to take action, instead of being held back by fears of “what if.”
The importance of comfort with ambiguity is no better exemplified than by Amazon’s success with two “radical” programs: Fulfillment by Amazon and Amazon Prime. According to Amazon founder Jeff Bezos, deciding to move forward with these programs came with significant financial risk — and a great deal of ambiguity.
“We could not foresee with certainty what those programs would eventually look like, let alone whether they would succeed, but they were pushed forward with intuition and heart, and nourished with optimism,” Bezos says.
Entrepreneurial leaders must be able to evaluate risk and eager to leverage it into growth opportunities whenever possible.
We often think of risk management in terms of damage control. However, it is also what allows organizations to identify and focus their attention on the high – impact risks that will move them closer toward their long – term goals.
Explains Professor of Management Ericka Kranitz, “Risk management helps companies get ahead of the game and seize the right opportunities at the right time.”
From Welch and Page to Musk and Bezos, every great business leader included on this list has taken calculated risks that bolstered their success.
New ideas, projects, and products need someone who can visualize the final product, articulate the steps necessary for getting there, and guide the way.
There’s no better example of the power of vision than Whole Foods’ co-founder and CEO John Mackey, who started the natural and organic food store 40 years ago with just 19 employees and the purpose – driven mission of helping people live healthier, longer lives.
Mackey says of his outlook, “As an entrepreneur, I’m focused on the future and what more I want to accomplish, rather than looking back at what I have already done.”
Vision goes only so far without initiative. Entrepreneurial leaders are quick to take action when encountering opportunities, and they encourage their team members to be equally proactive.
No discussion of entrepreneurial leadership would be complete without mention of Apple’s legendary leader Steve Jobs. One oft – told story has Jobs “stealing” the PARC technology that would lead to the personal computer revolution during a 1979 demonstration at Xerox’s Palo Alto Research Center.
According to Xerox’s Larry Tesler, however, the technology was willfully shared with Jobs, who immediately saw its potential — and was ready to act on it. Says Tesler of the interaction, “Jobs was waving his arms around, saying, ‘Why hasn’t this company brought this to market?’”
Jobs took the idea back to Apple and changed the world with the creation of the personal commuter.
Entrepreneurial leaders must be confident in their own abilities to make good decisions. This confidence is usually balanced by a combination of self – efficacy and self – awareness of limitations.
When Warby Parker co-founders and CEOs Neil Blumenthal and Dave Gilboa first presented their idea to their Wharton School professor Adam Grant, he shot them down. “My first reaction was: that’s ridiculous. You can’t buy glasses over the internet. You have to go get your eyes tested. And then you have to try them on. This is not going to work,” Grant told CNBC. And he wasn’t the only one to doubt the concept.
However, Blumenthal and Gilboa were confident in their idea, and this confidence propelled them forward. Today their “ridiculous” idea is worth a staggering $1.19 billion.
The question often arises of whether leaders are born or made. The same can be asked of entrepreneurial leaders. According to Oglethorpe, the answer is “made.”
She proposes that anyone can develop the skills and behaviors to become an entrepreneurial leader, but this learning is most likely to happen in the real world — not in the classroom. If leaders keep their challenges front and center in their day-to-day work, they’ll inherently start developing leadership skills because the most challenging situations are where the most learning happens. Entrepreneurs, however, have to have the stomach for taking on so much risk. And that might be something you are born with — or without.
“Every interaction, every conversation, and every piece of work is an opportunity for leaders to develop their skills,” Oglethorpe continues.
And while more didactic learning resources like books and workshops do have value, they can get you only so far. Learning through doing bridges the gap between learning and the real world.
She also highlights the value of mentorship, which can help aspiring entrepreneurial leaders get the feedback they need to reflect, grow, and improve.
“Feedback from a mentor provides them with a mirror that gives them a new perspective about themselves. It allows them to act with greater confidence and develop new ways of approaching things,” Oglethorpe explains.
Developing entrepreneurial leadership skills may mean the difference between making a small splash and creating a wave of change, says executive mentor, entrepreneur, and leadership expert Joel C. Peterson.
While traditional leaders can absolutely contribute to the organizations they lead, they rarely make a lasting impact just by coloring inside the lines. To make a transformative and durable difference, today’s leaders must explore new ways of doing things, champion their ideas, and implement new initiatives — all while inspiring others.
Image courtesy of istock.com/FlamingoImages
Last updated on Jul 24, 2024.
Originally published on Sep 01, 2022.
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Joanna Hughes writes extensively on a broad range of topics including business, finance, education, design, and more. She lives on the Seacoast of New Hampshire with her family.
Ashley Bonadiccio Jul 24, 2024
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