Wednesday, March 27, 2013

How to Defrag Your Entrepreneurial Ecosystem!

Developing Entrepreneurial Framework for Resilience And Growth

note: Have you read Brad Feld's Startup Communities**? (DEFRAG meets all 4 of his factors)

 “Get the right people on the bus in the right seats. Get the right people on and the wrong people off.”  – Jim Collins

“Make sure you really know where the bus is starting and where it’s going.” - Norris

There are so many people who have inspired and encouraged this work - Peter Vogel and some great new friends at the World Entrepreneurship Forum, ICSB/USASBE/NCIIA and Academy colleagues, friends in economic development and most assuredly from the entrepreneurial community worldwide... you know who you are. Thanks. The fact this works is a credit to you!

First… how to fix your ecosystem…. BADLY 
A healthy entrepreneurial ecosystem has multiple characteristics that are markers of how it’s growing or not. If you look at you’ll see a lengthy list but Brad Feld’s book points out some key pathologies, so let’s start with the four key “Brad Feld Discoveries”

bfd1. Is the defragging of the ecosystem being led by people who actually understand entrepreneurs? Especially led by the entrepreneurial community itself? Or by... VIPs?
            (Or are there self-styled experts who don’t ‘get’ the entrepreneurial mindset? The most frequent version of this is bringing together the key institutions, the ‘power players’ –are the power players helping the entrepreneurial community implement their vision or are they dictating it, even inadvertently?)

bfd2. Are the efforts inclusive? Is there something for different types of entrepreneurs? We need entrepreneurial thinking to blossom all through the ecosystem. In different industries (high tech and low tech), in different locations (urban and rural) in different strategies (high-growth and low-growth), in different life cycle stages, even for small, medium and large firms?  Nonprofits/social ventures? Public sector? (Well, we can dream, eh?)

bfd3. Is there a rallying point where everyone can look to? This can take many forms but a good place to start is simply twofold:
            The Bully Pulpit: Is the entrepreneurial ‘gospel’ being preached all through the ecosystem?  
            Strategy not Tactics: There actually IS a cohesive strategy, a comprehensive framework to help guide bottom-up efforts? (Or is there an emphasis on thinking up cool tactics that are sexy and have worked elsewhere but need not fit what the ecosystem really needs?)

bfd4. Are you willing to embrace that this is a long-term proposition? No matter how brilliant we might be now, it will likely be decades before we are really rolling. Again, do you have a cohesive, comprehensive strategy for entrepreneurship development? (a/k/a “Comprehensive Entrepreneurship Development System” to ‘fly cover’ for and support bottom-up efforts.) Or is there no committed strategy that we can hold our leaders to?

A few other pathologies of note before we dive in…

Ecosystems are COMPLICATED! We need to be sure that we consider the dynamics – what are the trends? How is everything interconnected? Dynamically? Or are you just making lists of all the participants in the ecosystem? A   Remember: what really matters are the INtangible elements of the ecosystem, not tangible.

The Global Entrepreneurship Monitor data tells us that over time and across countries, there are two predictors of increased entrepreneurial activity. These are the basis of the FIRE model of entrepreneurial development used across the globe:
            Entrepreneurial Human Capital: How many have the mindset… really?
                        F: Foster the entrepreneurial mindset broadly & deeply
                        I: Inspire the next generation of ideas
            Entrepreneurial Social Capital: How interconnected is the ecosystem and how well does it support entrepreneurial learning?
                        R: Revitalize (Entrepreneurialize!) Communities and Organizations
                        E: Enhance and Encourage the Connectors

Entrepreneurial Processes: Similarly, do we have the right processes in place?B Healthy ecosystems have great processes that tend to be completely unlike what 99% of communities do. If you are not frightening your mayor, you are failing. Sorry, but bureaucratic mechanisms do NOT generate entrepreneurial outcomes.

Entrepreneurial People: Start with the people who really get the expert entrepreneurial mindset. If they aren’t a great entrepreneur, they better be pretty special. The 3 C’s: Are they…
Competent at mission-critical ecosystem tasks
            [being really good isn’t enough, are they the best at these tasks?]
Connected – locally, yes, but have access to national/global resources/intel
[this is often a great marker of competence.. what do the nation’s best think?]
Collegial – have you ever screwed over someone, played silly turf games?
            [defragging the ecosystem means that roles will change significantly and job titles, mission statements, history and personal preferences mean nothing. At the outset, we need to keep the wrong people off the bus and these definitely qualify.
            NOTE: Everyone gets to be on the bus. Brad points out inclusivity is pretty much mandatory.]

Kwitcherbitchin: Economic developers have long known that you start with what you have and quit worrying about what you don’t have (if you really need something, it will be evident.)

Do You Know What You Really, Really Want? And by “you”, I mean the entrepreneurial community, not those who are telling you what they think you want.

No More Amateur Night: Experts not "experts." The world needs smart, passionate amateurs. But not driving the bus. An example…

Ideation or Implementation? In entrepreneurship, in technology commercialization, and here, there’s a dirty little secret: Good ideas are a dime a dozen. Even in rural Kazakhstan, you can find great ideas. What is scarce and what adds 90%+ of the value? Implementers. Even Silicon Valley sees a shortage of people who can execute.
            Corollary: Until you have a comprehensive strategy and until you have mapped the cosystem and held your listening sessions, brainstorming can be pointless, premature and (worse) distracting from the key tasks at hand.

            So….. what ARE the key tasks for defragging a local ecosystem? Not just Idaho, but anywhere?

Entrepreneurial Ecosystems' #1 Problem? (including Idaho??)
            Resources are simply not well-aligned to the key tasks at hand (duplication, gaps, and especially misdeployment, etc.)

            Issue 1: Alignment
Jim Collins: Progress requires "getting the right people on the bus... and in the right seats."  This is the “right seats” part of the equation.
            Getting the right people in the right seats... hard
            Getting the right people onboard in the first place.... harder
            Getting wrong people OFF the bus (for now)... hardest of all
                        [far easier to initially keep them off the bus]

But before we can really do this, we need to better understand where the ‘bus’ is going…

Entrepreneurial Ecosystems' #2 Problem? (including Idaho??)
            If we’re trying to get from ‘A’ to ‘B’, wouldn’t it help to understand ‘A’ and ‘B’?
We need to thoroughly understand where we are now (mapping and metrics)
We also need a deep, rich understanding of where the entrepreneurial community wants to go.

            Issue 2:  Roadmapping
We know proven practices to get from Point A to Point B
But we don't really know Point A...
...let alone Point B
So shouldn’t we immediately get busy and….
* We need to really map where we are (A) and
* We need to listen to the entrepreneurial community in person (B)

So what do we need to do now?
* Let's really map out our 'Point A' (current ecosystem)
* And really understand what the entrepreneurial community wants (Point B)

DEFRAG Initiative: Key Tasks

Key Task #1: Identify* / Convene "A Team"
            (competent, collaborative, connected locally, connected globally)
            Professional, inclusive;  p.s. local "A Team" already identified

Key Task #2a: A-Team to Align Resources to Key Tasks/Tactics
            (distinctive competences not core competences)

Key Task #2b: A-Team to Map Ecosystem (Point A, Point B)
            Assess current conditions – use Peter Vogel’s ecosystem instrument
            Assess current processes/trends – ecosystem markers (
            Large-sample surveys of entrepreneurial community (N>2,000?)
                        Existing entrepreneurs
                        Potential entrepreneurs
                        Use surveys to assess perceptions of ecosystem
            Build map using the above plus Isenberg’s 6-fold typology
Key Task #2c: Listening Sessions with Entrepreneurial Community
            State-wide, inclusive, bottom-up (“entrepreneurs only”)
            Appreciative inquiry tools plus asset-based ec dev tools
            Role model: NCRE Rural Entrepreneurship Listening Sessions [link?]

Now What?
I started out with all the things that we must and must not do… but I think they are mostly common sense once you embrace the complexity and dynamics and interconnectivity of entrepreneurial ecosystems (and all the people and organizations caught up in it, making it happen!) A few vested interests will be annoyed but… this IS disruptive technology.

Basically, we need an overarching strategic framework that doesn’t dictate but does facilitate bottom-up initiatives. One that provides both ‘cover’ and commitment to the initiatives. Molding entrepreneurial champions is a lot like molding entrepreneurs. The DEFRAG model includes such a framework, simple and comprehensive (the FIRE model).

“Point A” to “Point B”: Healthy ecosystems have a pretty good, shared sense of where they are and where they want to go. Most communities have either no map, multiple maps or a crappy map. (Let’s be different, ok?) Likewise, even fewer communities have actually listened to the entrepreneurial community. Vox Entrepreneurii? Let’s do that too.

Alignment (distinctive competence not core competence: In healthy local economies, the support activities are done by those who add the most value. It may not be what they’re best at and pretty likely not what they wanted to do, but it IS where they make the biggest difference for the ecosystem. We need the “A Team” for that but more important, we need this led by  organizations that are clearly neutral-turf, fair-broker (no enemies, plenty of friends). We’ve already started on this too.

Remember: We have the tools, proven globally. We have the "A team" identified. But it won't be easy.

Want in? (check the 3 C’s above)

Entrepreneurially yours,

End notes…
A  to capture interconnectivity/dynamics
Key Elements of the Ecosystem to Identify
Connectors - who is getting people together...proactively?
Controllers - who are gatekeepers for key resources?
Pulse-Takers - who is keeping track of how we're doing?
Mavens - who's out there that actually understands all this?

B 5 focus areas for ecosystem processes: Policy Formulation; Networking & Collaboration; Entrepreneurial Human Capital; Communication; Governance / Leadership

C Isenberg’s ecosystem map has 6 key participant categories (static but helpful)

** if not, why not? Cheap on Amazon/B&N! 

Tuesday, March 12, 2013

The Copernican Revolutions in Entrepreneurship

The Copernican Revolutions in Entrepreneurship

February celebrated Copernicus's 540th birthday and it got me to thinking. 

I have always wanted to write about the Copernican Revolution in entrepreneurship. Copernicus is famed for showing us that the universe as heliocentric not geocentric, but his vision grew from multiple new assumptions about the nature of things.

The result is more than "the earth goes around the sun"; it was a whole new way of looking at the world. I would argue that the last couple of years we have seen nothing less than a Copernican revolution in our understanding of entrepreneurship.

And like Copernicus, this is already upsetting the apple cart in ways both obvious and subtle. 

Disruption is always messy but consider this. Even the usual entrepreneurship education is disruptive, now imagine how the best entrepreneurship training would be off-the-chart disruptive. (Do you want to be the one to tell the vast majority that they are letting down their community and their students?)

Consider the disruption already sweeping over higher ed and how oblivous/defensive most institutions are. Online education is wreaking havoc and it's the rare school that knows how to respond. (How can they, when they can't... won't... see the disruption? Clay Christensen 101, eh?) 

Copernican Entrepreneurship
In entrepreneurship: we see revolutions on multiple fronts. Let's start with this

The Revolution in Entrepreneurial Education:
the New Copernican Assumptions

1) teaching <<<< learning
Earth-centric: Teaching (and teachers) is central
Sun-centric: Learning (and learners) is central***

2) Not knowledge, not skills... Mindset!
Entrepreneurship is about action AND the mindset that facilitates action.  (Knowledge and skills are tools but it's that deeper mindset that truly matters)

3) Think novice ---> expert
Therefore, growing a more expert mindset is critical (again, not knowing "stuff" but seeing the world differently)

4) Experiential NOT "hands-on"
Changing mindsets requires deeply experiential learning [note: Learning NOT Teaching]

4) The entrepreneurial ecosystem matters
The best way to know if you have a healthy "entrepreneurial ecosystem" [the new Copernican cosmology!] is: Are we encouraging people to see more/better opportunities to create value for others? Are we providing multiple pathways for people to learn to think like expert entrepreneurs?

What does the expert entrepreneurial mindset look like? Here's a hint: 
If the heart of entrepreneurship is acting on opportunities and
the head of entrepreneurship is seeing actionable opportunities, then
the soul of entrepreneurship is understanding that "opportunity" is about creating value... for others!

Bonus for reading this far: Fun analogy from my friend Helge Lobler on piano players
       "Think about how a traditional MBA program would educate piano players: they would give lectures, they would hand out syllabuses, the would have written exams and progressive programs would have group work on presentations on how to play a piano – wow. But can anyone really play a piano after enjoying (?) the program?"

He's being a bit unfair... but not by much. You have to go all in with true experiential learning. All. in. Think of how you become a chess master. Yes, you will play a lot (and study a lot) but how do you ensure that learners take away the right lessons from their experiences? You need the help of other chess masters, especially grandmasters. So if we are to going to grow :"chess masters" in entrepreneurship... how do we do that? Stay tuned!

My next posts will address:

1) "Entrepreneurial Ecosystems 101" - what we have learned recently that is game-changing. (If  you read Brad Feld's book Startup Communities, you'll know what is coming. if you haven't read it, do so. Now. :) And this is critical for growing the entrepreneurial mindset!

2) "Entrepreneurial Chess Masters" - I've written on this before but it's time to step up and get serious about entrepreneurial learning. NOW!

*** of course, kindergarten teachers have only known this for, what, 100 years? :)