The Entrepreneurship Safari

Entrepreneurs have grown beyond the common concept of founding and owning a business to being leaders and innovators; to seeking and finding opportunities where others have not; accepting challenges and risks; and exploiting networks and resources in implementing and growing the business venture.

“Entrepreneurs see change as the norm and as healthy. Usually, they do not bring about the change themselves. But – and this defines the entrepreneur and entrepreneurship – the entrepreneur always searches for change, responds to it, and exploits it as an opportunity.

 From "Innovation and Entrepreneurship: Practice and Principles" by Peter Drucker

Developing the digital workforce

Probably the biggest changes in managing digital workers have been on the learning and development front. Learning initiatives have to be far more updated, relevant, on-demand and customised for the digital workforce. They need to have real-time interactive dashboards and integrated analytics to be totally learner-centric and in fact learner-driven. Communication and collaboration for learning and development have to use effectively all the current day communication tools like instant messaging, enterprise social media, virtual meetings, and weave them with HR information systems, access and assessment tools.

With requirements of a more highly skilled and global workforce, the company human resources departments have a higher responsibility to provide access to the relevant knowledge resources, to the knowledge experts within the company, and to ensure both are used adequately. HR has to create a culture for the same with effective monitoring and incentives. Not only does this show employer concerns and priorities to the business and to employees, employees are well aware that building their skills improves their productivity, future job prospects as well as is an indicator of employer concern. Creating a culture of teaching and learning is the way to improve employee retention, as well as to ensure new skills required are available internally and can be on-boarded to new projects immediately.

What about freelancers and part-time or contractual employees? The same factors hold for them as well. Several business writers in the past have painted an image of freelancers, telecommuters and remote workers as working from home and taking calls while in bed, or working on the laptop dressed in pajamas. As the numbers of these digital workers have swelled and matured, it is no longer about being casually dressed or being laid back and away from office formalities. It is about flexibility yes, and even a physical nearness to the home perhaps. But it is increasingly about more speed, about anywhere access, about being networked and engaged, and about having the choice: of working on-demand, of refusing work, or of scheduling work to fit into life’s several other demands. This class of employees is extremely sensitive therefore, to their own requirements for continued learning and employability, and to an organization that takes care to include them in long term learning initiatives.

It is easier for the parent organisation, using current learning technology tools, to include freelancers and remote workers in processes of base lining organizational capabilities, setting learning goals, creating development plans, monitoring assessments and tracking resultant improvements in performance. This in turn enables organisations to adopt more effective technology tools, assess and justify their outlay, improve user interfaces, create an improved learning experience, plan for and build a talent pool and succession plan in advance.

A curious phenomenon that has been noticed of late, as the numbers of digital workers have grown, is that they no longer work alone at home unless they need to or want to. Several digital workers share workspaces whether it is at WeWork in New York City, BHIVE in Bangalore or SproutBox in Gurgaon. This combines the newfound freedom of flexible, digital and sometimes boss-less work, with the camaraderie of co-workers, coziness of shared workplaces and lives, and of course the opportunities of shared learning through a network of peers.

There is an added delight of some face-to-face chatting, sharing food and music, the latest movies, devices and killer apps with the peer group!

On-boarding at digital workplaces

A digital on-boarding process does not only mean saving on long boring paper work. It also means being more personal, engaging and accessible to its digital workers. Previously available information can easily be carried forward and duplicated in a digital process. Information about the company can be animated and interactive, using visuals, games, videos and content maps. The whole process can be monitored and can evolve with live discussion and interaction. The self-service and collaborative elements possible in such an offering build for far greater engagement and retention than routine paper work.

Companies like Appical, HROnboard use gaming technologies to give new hires a visual and realistic experience that can be delivered anytime, anywhere. New employees are taken through representative organizational situations; they attend talks by key people, and also interact with their peers using mobile and social networking technologies. The questions, problems and frustrations of new employees as they navigate through the induction process, can be better captured, and attended to in a digital experience, so as to continuously improve the process.

Managing people

Allocating work, monitoring, and feedback processes can be captured in current HR management systems. The systems however need to combine social, mobile and cloud technologies, with apps, videos, animation, and design thinking, to improve on accessibility, speed and flexibility of systems. While companies like Taleo, SuccessFactors, SumTotal, WorkDay, Kenexa and DATIS have all strengthened their Cloud HR offerings, companies like Fieldglass have specialised in contingent and variable workforce management, and others like SnapHRM have specialized in small and medium scale businesses.

These systems manage the regular processes of leave, absence and work attendance policies, compensation, rewards and incentives, performance management while integrating with work calendars, planning and scheduling activities of the distributed digital work force, all in a self-service, engaging and empowering employee experience.

Workplaces are physically becoming more fluid and flexible too. Use of technology has meant more collaborative spaces. The on-boarding process must get the new employee acquainted with all the collaborative spaces, the people and resources that can be accessed digitally, and the company-specific tools for greater productivity in the digital environment.

Acquiring talent for digital workplaces

by Mita Brahma

Recruitment teams in HR have been using online job portals like Monster, Naukri and Careerbuilder for a while now. They have increasingly been exploring networks like LinkedIn and YouTube for a greater understanding about the candidate’s personality. Facebook, Twitter, Flickr, blog posts and shared online comments give valuable information to the company about a candidate much before a face-to-face meeting or a Skype/ Facetime call. Company websites, online financial reports, and Glassdoor reviews similarly prepare an employee for the organisation, by giving relevant information before an interview or meeting. 

All this information results in speedier and more effective access for the organisation to candidates who are a better fit for the position. Candidates too with the increased level of information, show interest only in roles and organisations they are most suited for. The processing of applications takes far less time on both sides, with this kind of filtering beforehand.

Most job portals have applications to help with the job-fit process, as well as tracking regarding the assessment and selection process. Companies may also be able to tag resources who are competent and suitable to the organisation, but not available immediately, to access later for possible future vacancies.

However, just moving some of the recruitment positions and processes online, having filtering and tracking processes in place, still does not ensure that candidates who respond are a good fit for the position. Companies need to monitor the communication traffic for their target employee segments, and learn to wade through social connections of referral paths, to reach at their target candidates. One way that is emerging is to form online "talent communities". 

Companies may build their own talent communities. In addition, they can reach out to niche talent communities like UpWork, Zartis or the Indian firm Tadpoles. These platforms have sprung up to showcase the expectations and aspirations of the modern digital worker, who are not happy just being part of online resume banks like the old job portals were.

Both talent communities and job portals are present on various smart devices as well. Companies have to be present on job portals, niche talent communities, maintain their own career website. They may use one platform more than the other, depending on the positions that they are trying to fulfil, and the kind of target segment they are trying to reach out to.

It is clear whatever platform they use, companies have to be better at scouting and engaging potential employees. While online communities can be accessed easily, it is a two-way street. Potential employees have to be engaged online, and a regular, inclusive communication program should be on.

 Apart from reaching out to the right candidates, HR finds assessment processes have got complex too. With digital workplaces demanding skills that are not yet part of formal curriculum, HR cannot depend much on the candidate’s previous academic record. It has been found that high CGPAs in college do not necessarily mean a great worker, and nor do the usual assessments predict performance(1). 

What HR would like to do is to find proven competence required for the job, and to also ensure that the candidate would be ready to pick up on new skills, as the role and demands of the organisation keep changing. This is easier said than done.

To find the best person out of available candidates, if not the right person, assessments need to be redesigned for the digital age worker. 

The best way to predict a person’s fit to doing a job well, is to do just that: to give a sample of the work to be done, and to checkout the performance. This exercise is not a perfect predictor either, and nor can it be done for all types of jobs. However "work sample tests" need to be designed, requiring similar cognitive and creative abilities as the tasks in a given role. The assessment must be capable of being administered remotely as necessary.

Organisations that manages to have an internally validated repertoire of assessments will certainly have a competitive advantage over time. Google is known to give its interviewers standard guides of interview questions based on years of number crunching of finding out the best predictors from in-house data. However, assessments predicting success for one organisation do not translate into success for another. Organisations would have to do their own number crunching on what would work for them, and this would have to be a continuous improvement process.

Of course that is easier said than done. One place companies could look at for best practices in online assessments is the massive online open course offerings like Coursera, Udacity and edX. They have not only reinvented education but also changed online assessments to improve candidate engagement, and speed and efficacy of assessment. For online large scale assessments, HR could use some of the features found in these organisations. For example, why not have more online and transparent peer-to-peer assessments, by current employees, as in the MOOCs? Why not weave some of these practices of online education communities, into the selection process within corporates? 

(1) http://link.springer.com/article/10.1007%2FBF00983503#page-1 accessed June 1st, 2016.

Are you ready for digital workplaces?

by Mita Brahma

At the start of the industrial era, a lot of people genuinely feared that machines would replace manual labor, and create widespread joblessness. While it is true that many repetitive manual tasks did get taken over by machines, it is also true that the industrial era led to new categories of jobs. The better jobs however, went to the more skilled workers, with highly skilled workers at a premium.

Kinetic Art by Nemo Gould

A similar revolution has been under way at workplaces with the world going digital.  A whole category of new jobs has grown, which are skill dependent and quite independent of the time, place and employer. These jobs may be temporary, contractual or permanent, on a project basis, term basis, or on-demand basis, part or full time, remote or on-site. What is common is that they require a specific competence and technology support.

Many jobs are available on a freelancer basis. According to a recent Forbes report, more than a third of the working population in the US is already freelancing, though this percentage does include some moonlighters.[1] As per a survey of marketplaces for freelancers like PeoplePerHour and HourlyNerd, the percentage of freelancers would grow to 40% by the year 2020 in the US.[2]. It is quite reasonable to presume therefore that organisations across the world would have to use a fair portion of freelancers in addition to their full-time regular employees.

Not only would the organisations of the future have a combination of all categories of employees: part or full time, contractual and project based or on demand; but their regular full time employee may want different kinds of work arrangements through different phases of life. Employees may want to work from home to avoid traffic woes and office distractions (yes, there are plenty of distractions at office too!) or want to be available at home for domestic exigencies. Employees in certain situations may want to work part time, and they may even feel they would be more productive working from home. All members of such virtual workplaces or virtual equivalent of physical workplaces are often referred to as digital workers. The technology and business infrastructure and management support that makes such workers effective are all part of the modern day digital workplace.

Yahoo CEO Marissa Mayer’s directive a couple of years back that some Yahoo employees would no longer be able to work from home sparked debates and research on all forms of digital workplaces and their pros and cons. How does it affect productivity, loyalty, teamwork and happiness at work? Do digital workers require a digital team leader? Should they have a few digital peers? In an experiment with telecommuting, the Chinese travel company Ctrip allowed one volunteer group of employees to telecommute, while another control group of employees worked from the office. Much to their own surprise, the group that had worked from home was happier, more productive, and reportedly less likely to quit.[3]

What are the skills and processes required to use and manage a diverse and dynamic “digital” workforce that includes full and part time “remote” workers, regular and contractual on-site employees as well as digital time or project based freelancers? For organisations not used to reviewing their processes every year, this is going to be a challenge. How does one effectively find, recruit, deploy, monitor, assess or reward a workforce that is independent of the location and physical monitoring? One can ensure telephones, Internet connections, video conferencing hardware and software, and document sharing is in place on all sides. One can also work on ensuring a pleasant experience across tablets, laptops and smart phones at different time zones and locations.

The challenge is not in being able to use technology; the challenge is in the whole new way of thinking about work, which makes it possible to effectively allocate work, to monitor and manage this dispersed, diverse group. Organisations have made incremental changes in their processes as they learnt to use new technologies. The challenge is however in allocating work in a more customized human-centric way, and then measuring individual contribution. Administering appropriate rewards and incentives just got more complex!

[1] http://www.forbes.com/sites/susanadams/2014/09/05/more-than-a-third-of-u-s-workers-are-freelancers-now-but-is-that-good-for-them/#75d05ab93f04

[2] http://www.fastcompany.com/3049532/the-future-of-work/heres-why-the-freelancer-economy-is-on-the-rise

[3] https://hbr.org/2014/01/to-raise-productivity-let-more-employees-work-from-home 

Startups within the firm

An organization that encourages entrepreneurial behavior amongst its employees does so for a variety of reasons: it hopes to spur innovation amongst its employees; the resultant opportunities help in increasing revenues and profitability; teams that are entrepreneurial may have accelerated learning pursuing new initiatives, and may transmit some of it to other parts of the company; new career paths emerge for employees along with differentiation in products, processes or markets; there is a new energy in the organization, that keeps it from becoming slow or bureaucratic as the organization grows in size.

To rejuvenate the organization, and contribute to its growth, entrepreneurial initiatives must complement its existing products, or contribute to its competitive advantage. There is a high chance of that happening with initiatives from within the company’s own employees who are conversant with its products, customer needs, and future possibilities.

What kind of an organization is able to encourage its employees to discover and exploit opportunities, gives them the right amount of and timely backing, and helps them create wealth for themselves and the organization? Covin and Slevin (1991, A conceptual model of firm entrepreneurship as firm behaviour) have in their extensive research identified the three prime attributes of entrepreneurial organizations: innovativeness (or the ability to come up with creative solutions), risk taking (or being able to commit the sufficient and timely resources and managerial support in the face of uncertainties) and proactiveness (or taking initiative, removing obstacles, showing energy and being able to execute).

To succeed in their entrepreneurship strategy, organizations incentivize their employees in various ways. In India, the Mahindra Group is empowering employees to start ventures with organizational resources; it is incubating startups at a firm level; as well as allowing other employees to invest in these startups. All this makes sound business sense, as it keeps a young energetic entrepreneurial workforce within the organization, and not have them want to strike out on their own. As long as such employees get sufficient autonomy to realize their dreams, they would certainly welcome the organizational support. (http://tech.economictimes.indiatimes.com/news/startups/mahindra-group-plans-to-allow-staff-to-invest-in-its-startups-like-szenseye/48094013)

Marshmallow Tests: Promise and Limits

by Gautam Brahma

In the ‘60’s Walter Mischel of Stanford University conducted a series of interesting experiments to study impulse control among children. He offered sweets to groups of 4 to 5 year olds with the condition that they could either have one sweet right away or get two sweets if they waited for a while. He found that some kids could not wait at all while some others could wait for as long as 20 minutes. The mean waiting time was 7-8 minutes. Mischel followed up these children regularly for four decades and found that those who exhibited greater impulse control scored better at school and college, stayed out of trouble with the law and got better paying jobs. These experiments are usually referred to as the Marshmallow tests after the eponymous sweet, though Mischel and later experimenters used a variety of sweets including chocolates.

The Marshmallow tests have been discussed threadbare, especially because other studies suggested that the exhibited impulse control was largely learnt and not entirely genetic in origin. This meant that children could be taught to control impulses and thereby assure a better life for themselves in the future. People have also speculated on policy implications of these tests assuming that the inferences hold for adults. For instance, one interesting experiment reported in 2013 actually extends the findings of the Marshmallow tests by suggesting that waiting by choice makes the reward even more desirable. Researchers from the Booth business school in Chicago University and from the Chinese University Hong Kong, asked volunteers to choose between small rewards that they could have early and large rewards which they could get if they get later if they waited. They found to their surprise that the percentage of people prepared to wait for a larger reward actually went up as the wait duration was increased. Not only that, the percentage choosing the larger and later option went up even further if the options were presented today but the respondents were given some days to mull over their final choice! The managerial implications for designing deferred payment schemes and financial savings instruments are obvious.

Managerial interest in the Marshmallow tests also stems from the finding that current performance (on the job or in the classroom) can be predicted by seemingly unrelated behaviour in the past (choosing to eat one sweet now or wait a while and eat two). One cannot go back in time and create tests for any personnel one is evaluating but one can dig into past records for other evidence of peripherally related but desirable behaviour. Moreover, with the availability of convenient data analysis tools one could look at multiple surrogate variables to improve the reliability of these evaluations. A recent piece in the New York Times lists many examples of this approach to predicting future individual behaviour . Financial services startups Upstart and Zest Finance are awarding loans for people without decent credit history by  processing variables like nature of school attended, marks obtained, and surrender of pre-paid phone connections. Workday offers HRM software for enterprises that processes 45 variables to predict likelihood of an employee quitting the company. Jure Leskovec of Stanford has used a similar data-driven approach to evaluate bail applications and found that this approach is 30% better than the one currently in place where a judge takes a look at the applicant and decides whether or not he or she is a risk.

Managers can not only leverage evidence of past, seemingly unrelated, behaviour to evaluate staff and customers, they can also design processes and incentives to improve impulse control in these people. This is another way of improving chances of future success. Rewarding people for long courses of study and well-crafted deferred payment schemes are just two examples. The larger field of behavioural economics subsumes such studies and one oft-quoted reference for examples of how even national policies can be driven using this approach is ‘Nudge’ by Richard H. Thaler of the University of Chicago and Cass R. Sunstein of the Harvard Law School. This vast field deserves a separate discussion.

Like every other prescription in Management, the desirability of impulse control is also context-specific. Detailed studies focussing on differences across socioeconomic groups by Gene H. Brody of the University of Georgia have shown that while the better-off benefit unconditionally by adopting impulse control the results are more nuanced in the case of the less privileged. Poorer people display the same long-term benefits at school and in jobs but also display worrying symptoms like high blood pressure, obesity and higher levels of stress hormones. Impulse-control is apparently a mixed blessing for the poor. What is even more amazing -and disturbing- is that higher impulse control in the poor was linked to faster cell ageing suggesting some sort of permanent damage. Why this happens and how how this can be offset will undoubtedly be studied by researchers, but till then this remains a cautionary input for managers interested in the Marshmallow tests and related insights.

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References:

1.     “When Waiting to Choose Increases Patience”; Xianchi Dai & Ayelet Fishbach; OB and Human Decision Processes; Vol 121 issue 2; July 2013

2.     “Using Algorithms to Judge Character”; Quentin Hardy; NYT;  July 26, 2015

3.     “Self Control Forecasts Better Psychosocial Outcomes but Faster Epigenetic Ageing in Low-SES Youth”; Gene H. Brody et al; Proceedings of the National Academy of Sciences of the USA; June 2015

The paradox of success

Whether as individual entrepreneurs, or as heads of entrepreneurial teams, stories about successful entrepreneurs have always captured popular imagination. What is different about them, or what has been different in their lives, readers wonder. While all details about success stories are sought after hungrily, the fact is that research has not been able to isolate any special “traits” of entrepreneurs that one might use to predict success of an entrepreneurial venture.

A study by Kets De Vries (The entrepreneurial personality: A person at the crossroads) found no commonalities in his research on the lives of 150 entrepreneurs. However, in their actions, he did find some commonalities: a strong sense of independence, a need for control, for achievement, a dislike for repetitive work, and a liking for “moderate risks”. On an “internal-external scale” to measure locus of control, entrepreneurs were typically on the internal end, that is, they tended to believe they had control over their destinies, wanted to be self-reliant and have autonomy (while people on the external end would believe they were controlled by their destinies).

He also found that some of these behaviors, which helped the person create a new venture, often created handicaps as the organization grew: the entrepreneur was typically autocratic and directive, poor at delegation, intolerant of organizational structures, and made no distinction between day-to-day operational matters and long-term strategic moves. Because of their autocratic ways, the entrepreneurs studied often got surrounded by yes-men, leading to a work environment around them that was politically charged and full of uncertainty.

It was only a few that managed to guide the organization through its formative years to maturity, and still fewer that were able to organize a proper succession and effectively hand over the reins. A few managed to create in the process, a work culture that retained the dynamism and energy of the entrepreneur. De Vries suggested, “Perhaps internal entrepreneurship in large bureaucratic organizations is the inevitable response to organizational decay and inertia.”

Corporate Venturing and technology start ups

Corporate venturing or corporate entrepreneurship is about setting up new businesses within a firm. The ventures start off as a result of ideas arising within, and opportunities recognized by the organization, and are referred to as internal corporate ventures, as opposed to external ventures. If the internal venture grows well, it is given more structural and strategic support, and may be eventually spun off and given more autonomy.

External corporate ventures on the other hand are independent, usually small firms or start-ups. The organization may be interested in the external venture for strategic reasons and help in co-creation or investing or mentoring the external venture, and may eventually acquire it. The advantages in acquiring this relationship are manifold: while the external start-up venture gets the much needed capital, resources, and reputational strength, the larger organization acquires or gets access to: a young, ambitious agile team; new technologies and processes; and a fresh set of new opportunities.

While this should save time, and build value on both sides, a recent article in the Economic Times criticizes the investment strategy of some big IT firms. It finds that investments are far removed from the core competencies of the company, and as such may not add to a competitive advantage. Also that such an investment may hinder the growth of the startup by putting an unnecessary constraint imposed due to having received the munificence of one party, and being disallowed relationships with others more in its line of business. 

(http://articles.economictimes.indiatimes.com/2015-07-02/news/64039265_1_venture-capital-axeda-early-stage-startups)

Hunting for the opportunity & “Hello English”

Entrepreneurs see opportunities where none seem to exist. It means a Bill Gates refusing to sell the source code of a MS-DOS to IBM, and proposing instead a small licensing fee for every copy of the software bundles with IBM computers. Steve Wozniak had approached his employer Hewlett-Packard with the design of the original Apple 1 personal computer five times, only to be turned down each time. It took a Steve Jobs to convince him to leave HP and strike out on their own together.

Mintzberg developed the concept of an “Entrepreneurial school” of strategy making (Strategy Safari: A guided tour through the wilds of strategic management):

In the entrepreneurial mode, strategy making is dominated by the active search for new opportunities. The entrepreneurial organization focuses on opportunities; problems are secondary.

Fresh success stories come up every day: While Rosetta Stone and Duolingo are known internationally for learning foreign languages, here comes “Hello English”, from Jaipur, India. Hello English is an English learning app, focused on the Indian market and teaching English via 12 vernacular languages of India. Within eight months of its launch, Hello English has become the top selling app on Google Play. It works offline as well, and is supported by a chat feature with ‘English experts’.