1

PREFACE

This module is about entrepreneurial leadership in an organization.

Leadership talks about influencing people through actions and models. Leader and
entrepreneur can be two different people, but if one person possesses leadership
and entrepreneurship, it will significantly impact their business and even on their
society. In this module, the students will understand and comprehend leadership
and entrepreneurship topics and how they can combine it into one concept.

This module comprises discussion, setting up activities, and assessing

learning to ensure students learn a lot about entrepreneurial leadership in their
self-paced learning, guided by their instructor.

DMP
NCN

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 TABLE OF CONTENTS
PAGE
Preface

UNIT I
INTRODUCTION TO ENTREPRENEURIAL LEADERSHIP IN AN 4
ORGANIZATION

Learning Objectives 4
Setting Up 4
Lesson Proper 4
Introduction 5
Leadership: Definition 5
Views on Managers Versus Leaders 6
Entrepreneurship 6
Assessing Learning 8
References 11

UNIT II
Understanding Leadership Styles and Theories 12
Learning Objectives 12
Setting Up 12
Lesson Proper 12
Introduction 12
What is Leadership? 13
Major Leadership Theory 14
Assessing Learning 21
Reference 25
UNIT III
Understanding Leadership Styles and Theories 26
Learning Objectives 26
Setting Up 26
Lesson Proper 26
7 Core Belief of Successful Entrepreneurs 27
Entrepreneur Visions 30
Role Played Mission and Vision 31
Organizational Culture 33
Assessing Learning 36
References 39

UNIT IV
Imagery and Values in Entrepreneurial Vision 40
Learning Objectives 40
Setting Up 40
Lesson Proper 41
Creative Approach in Developing Your Visions 41
Achieving Balance 43
The Values that Sustain Entrepreneurs 45
Assessing Learning 48

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 References 50

UNIT V
Leadership vs. Entrepreneurship 51
Learning Objectives 51
Setting Up 51
Lesson Proper 52
Difference between Entrepreneurship and Leadership and its 52
meanings
Leadership Style and Frameworks 53
Assessing Learning 58
References 61

UNIT VI
Entrepreneurial Leadership Process: Corporate Entrepreneurship 62
Learning Objectives 62
Setting Up 62
Lesson Proper 63
10 Reasons for Corporate Entrepreneurship 63
Four Models of Corporate Entrepreneurship 64
Corporate Entrepreneurship 65
Five Forms of Corporate Entrepreneurship 67
Assessing Learning 69
References 71

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Unit I

5
 Introduction to Entrepreneurial Leadership in an Organization
Overview
This unit deals with the notion of entrepreneurial leadership.It also focuses on
theroles andimportance of entrepreneurial leadership.

Learning Objectives

At the end of this unit, I am able to:

 define entrepreneurial leadership;
 understand the roles and importance of leadership and
entrepreneurship;and
 understand how leadership, entrepreneurshipare interrelated.

Setting Up

Name : ____________________________________ Date: _______________

Course/Year/Section: ____________________

Directions:This classic activity clearly shows the difference between being a manager and
being a leader. Management and leadership are often interchanged within the business
world; however, they are two very distinct skills.

Management is essentially process/task focused and centers on the current and immediate
future. Whereas, Leadership is much more people and future focused. It includes setting
culture &direction for the organization.

Identify which of the statements on the Manager Vs leader table describe

management behavior and which describe leadership behavior.

Manager Vs Leaders Table :

Manager or Leader

Manager Or Leader
• Scheduling work
• Sharing a vision
• Plan and prioritise steps to task achievement
• Use analytical data to support recommendations
• Explain goals, plan and roles
• Provide feedback on performance
• Motivating staff
• Provide focus
• Create a ‘culture’
• Inspiring people
• Delegating tasks
• Ensuring predictability
• Co-ordinate effort
• Co-ordinate resources

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• Give orders and instructions
• Act as interface between team and outside
• Take risks
• Guide progress
• Evaluate progress
• Check task completion
• Create a positive team feeling
• Monitor feelings and morale
• Look ‘over the horizon’
• Appeal to peoples’ emotions
• Follow systems and procedures
• Provide development opportunities
• Ensure effective induction
• Monitor budgets, tasks etc
• Use analytical data to forecast trends
• Monitoring progress
• Unleashing potential
• Be a good role model
• Appeal to rational thinking
• Build teams

Lesson Proper

Introduction

At the present competitive world leadership is a dynamic process where influencing others
is the most important issues. That’s why exercising power is one of the most important
issue to be a charismatic leader and this power doesn’t come automatically it comes after
advocating other fellow members. Here, one thing is most important to remind that the
power should be imposed and exercise within the worth and boundaries of the leaders.
However organization’s culture, its mission, vision, short-term strategies all these reform
the leadership process.

Leadership: Definition

Leadership is the process of influencing the motive of the employees and so directing,
guiding them to the proper completion of the short-term goals and the mission, vision of the
firm. Leadership referring to achieve a specific set of goals of the business enterprise by
minimizing risk and more advantage of opportunities is also called Entrepreneurial
Leadership (Rao, 2015). Today leadership is such an iterative process when the leaders
should have a variety of qualities and expertise in different area of management. Here,
different theories will be explained which can clearly identify the scope, the responsibilities
and the area of expertise required to be successful leader.

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If management is defined as getting things done through others, then leadership should be
defined as the social and informal sources of influence that you use to inspire action taken
by others. It means mobilizing others to want to struggle toward a common goal. Great
leaders help build an organization’s human capital, then motivate individuals to take
concerted action. Leadership also includes an understanding of when, where, and how to
use more formal sources of authority and power, such as position or ownership.

Views on Managers Versus Leaders

My definition of a leader…is a man who can persuade people to do what they don’t want to
do, or do what they’re too lazy to do, and like it. (Harry S. Truman (1884–1972), 33rd
president of the United States)

You cannot manage men into battle. You manage things; you lead people. (Grace Hopper
(1906–1992), Admiral, U.S. Navy)

Managers have subordinates—leaders have followers. (Chester Bernard (1886–1961),

former executive and author of Functions of the Executive)

The first job of a leader is to define a vision for the organization…Leadership is the capacity
to translate vision into reality. (Warren Bennis (1925–), author and leadership scholar)

A manager takes people where they want to go. A great leader takes people where they
don’t necessarily want to go but ought to. (Rosalynn Carter (1927–), First Lady of the United
States, 1977–1981)

The following table shows the distinct elements which fall under each category.

 Manager Leader
• Build teams
• Scheduling work • Provide feedback on performance
• Delegating tasks • Motivating staff
• Use analytical data to support • Act as interface between team and
recommendations outside
• Ensuring predictability • Explain goals, plan and roles
• Co-ordinate effort • Inspiring people
• Co-ordinate resources • Appeal to peoples’ emotions
• Give orders and instructions • Sharing a vision
• Guide progress • Provide focus
• Evaluate progress • Monitor feelings and morale
• Check task completion • Create a ‘culture’
• Follow systems and procedures • Create a positive team feeling
• Monitor budgets, tasks etc • Ensure effective induction
• Use analytical data to forecast trends • Provide development opportunities
• Monitoring progress • Unleashing potential
• Appeal to rational thinking • Look ‘over the horizon’
• Plan and prioritise steps to task achievement • Take risks
• Be a good role model

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Entrepreneurship

Entrepreneurship is defined as the recognition of opportunities (needs, wants, problems,

and challenges) and the use or creation of resources to implement innovative ideas for new,
thoughtfully planned ventures. Perhaps this is obvious, but an entrepreneur is a person
who engages in the process of entrepreneurship. We describe entrepreneurship as a
process because it often involves more than simply coming up with a good idea—someone
also has to convert that idea into action.

Entrepreneurial Leadership

Entrepreneurial leadership involves organizing and motivating a group of people to

achieve a common objective through innovation, risk optimization, taking advantage of
opportunities, and managing the dynamic organizational environment.

Various studies have shown entrepreneurial leadership is actually not one particular trait
but actually a range of different personal attributes. These include the ability to anticipate,
envision, maintain flexibility, think strategically and work with others to initiate
changes that will create a viable future for the organization.

However, the most critical defining factor is that good entrepreneurial leaders care about
their organizations and their people but this is a difficult balancing act in ensuring that they
can work closely with their staff whilst maintaining a leadership role.

For example, they need to be friendly, approachable and treat them like equals whilst
remaining sufficiently distant to exert authority. They also ensure that their team are
empowered to make decisions, are aware of the rewards and penalties of not achieving
their objectives but also trust the leader’s judgment.

They do not impose their solutions on their teams or exclude or suppress potential. Rather
they encourage their staff to be creative and to find their own solutions to problems.

Most importantly, the authority of entrepreneurial leaders does not come from the position
they are given but from their expertise and values.

According to Esmer and Dayi, 2016, entrepreneurial leadership can be defined as a leader,
who is also have the skills of entrepreneurship. In other words, entrepreneurial leadership
refers to the managers who can take risks, seize opportunities, pursue innovation and be
innovative, producing, interchanging and strategic. In addition, entrepreneurial leadership
is creating new products, new processes and expansion opportunities in existing
businesses, working in social institutions and dealing with ignored social issues,
participating in social and political movements, contributing to the change of current
services and policies implemented by civil society organizations and governments.
Entrepreneurial leaders know themselves and their environment very well and find new
opportunities creating value for businesses, stakeholders and society. The main motivation
of leaders is their desire to create social, environmental and economic opportunities.

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 Figure 1: Model of Entrepreneurial Leadership

Source: Greenberg et al., 2011:11

Importance of Entrepreneurial Leadership

Entrepreneurial leadership is an important factor affecting the performance of the

company. Therefore, in today’s intense and dynamic competitive business environment,
leaders of companies and especially leaders of small-scale family companies should have
and use the qualities of entrepreneurial leadership in order to continue their lives, compete
withtheir competitors and develop themselves (Karcioglu and Yucel, 2004: 417). In other
words, administrators must be entrepreneurial leaders for the success and continuity of the
business. So entrepreneurship education has been very important for business
management (Okudanand Rzasa, 2006: 197). Entrepreneurship lesson for student must be
at university education process (Bagheri and Pihie, 2010: 470).

Entrepreneurs leader, has leadership potential combining with entrepreneurial

skills, for example, not only team up as a soccer player, he is the person who play in the field
with the team as captain. Not only administrator who decide, give instructions and check
their workers, but also they should prefer to be entrepreneurial leaders who captained the
team and showing the way. When entrepreneurs take risk and they seize opportunities, this
leadership has been very important for the growth of the business in the future (Phaneuf et
al., 2016: 34). Therefore, it is an important phenomenon for entrepreneurial leadership in
business management.

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Role of Entrepreneurial Leadership

Entrepreneurial leadership plays a significant role in determining the success of business

ventures. As for small businesses, entrepreneurial leadership remains essential as micro-
entrepreneurs may not successfully develop their business without displaying effective
leadership traits. Perhaps, this may be the reason that the theme of micro-enterprise
success has emerged as popular among entrepreneurs and researchers, especially for those
keen in discovering a definitive formula for successful micro-entrepreneurship.

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Assessing Learning

Name: ________________________________________ Date:________________

Course/Year/Section: _____________________ Score: ______________

Activity

Direction:Write the correct answer on the space provided.

__________________________________ 1. involves organizing and motivating a group of people to

achieve a common objective through innovation, risk
optimization, taking advantage of opportunities, and
managing the dynamic organizational environment.
__________________________________ 2. a person who engages in the process of entrepreneurship
__________________________________ 3.refers to the managers who can take risks, seize
opportunities, pursue innovation and be innovative,
producing, interchanging and strategic.
__________________________________ 4.defined as the recognition of opportunities (needs, wants,
problems, and challenges) and the use or creation of
resources to implement innovative ideas for new,
thoughtfully planned ventures.
__________________________________ 5.as a process because it often involves more than simply
coming up with a good idea—someone also has to convert
that idea into action.
__________________________________ 6.an important factor affecting the performance of the
company.
__________________________________ 7.plays a significant role in determining the success of
business ventures.
__________________________________ 8.leadership remains essential as micro-entrepreneurs may
not successfully develop their business without displaying
effective leadership traits.
__________________________________ 9.is a man who can persuade people to do what they don’t
want to do, or do what they’re too lazy to do, and like it.
__________________________________ 10.is defined as getting things done through others

Essay.

1. How do you define leadership, and who would you identify as a great leader?
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________

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2. What is entrepreneurship?
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________

3. What roles do leadership and entrepreneurshipplay?

_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________

Discuss the model of Entrepreneurial Leadership by Greenberg et al., 2011:11

_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________

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References:

The Importance Of Entrepreneurial Leadership | ipl.org

https://www.ipl.org/essay/The-Importance-Of-Entrepreneurial-Leadership-P3SVT57ESJFR

10 Entrepreneurial Leadership Characteristics, Attributes and Traits (yscouts.com)

https://yscouts.com/10-entrepreneurial-leadership-characteristics/#:~:text=Entrepreneurial
%20leadership%20involves%20organizing%20and,managing%20the%20dynamic
%20organizational%20environment.

Entrepreneurial leadership - Small Business Charter

https://smallbusinesscharter.org/business-advice/entrepreneurial-leadership/

1.4 Leadership, Entrepreneurship, and Strategy – Principles of Management (umn.edu)

https://open.lib.umn.edu/principlesmanagement/chapter/1-4-leadership-
entrepreneurship-and-strategy/

https://www.researchgate.net/publication/
287359719_Role_of_entrepreneurial_leadership_and_commercialization_of_university_rese
arch_A_review

https://www.researchgate.net/publication/
313951377_ENTREPRENEURIAL_LEADERSHIP_A_THEORETICAL_RESEARCH

Yusuf ESMER veFaruk DAYI - Entrepreneurıal Leadership: a Theoretical Framework

(dergipark.org.tr)
https://dergipark.org.tr/en/download/article-file/395369
sustainability-10-01591.pdf
file:///C:/Users/acer/Downloads/sustainability-10-01591.pdf

Leadership - Module 3: Building the Team | Coursera

https://www.coursera.org/lecture/entrepreneurship-1/leadership-FQVap

https://www.trainingcoursematerial.com/free-games-activities/leadership-and-
management-activities/manager-or-leader

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 Unit 2
Understanding Leadership Styles and Theories
Overview
This unit gives you an overview of the concept of leadership theories. This also
explains how entrepreneurial theories and leadership styles work within a company to
bring success.

Learning Objectives

At the end of this unit, I am able to:

 define leadership and leadership style;
 enumerate the leadership theories;
 explain the role and importance of shared leadership; and
 describe the transformational and entrepreneurship leadership style.

Setting Up

Name : ____________________________________ Date: _______________

Course/Year/Section: ____________________

Directions:Match the following leadership styles according to their description.

Behavioral Theory focuses on leaders who are mainly concerned

about their interactions with others

Contingency Theory focuses on supervision, organization, and

group performance.

Great Man Theory focuses on the context of a leader

Management Theory suggests that good leaders are born

utilizes their power and influence to get

Participative Theory
things accomplished

suggests that employees be directly involved

Power Theory in decision making in their organization

focuses on how leaders behave, and assumes

Relationship Theory that these traits can be copied by other

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Lesson Proper

Introduction

Every company, no matter what industry they’re a part of or how big they are, needs good
leadership to be successful. Good leaders are a vital part of effective business practices. And
for most, being a good leader doesn’t come inherently. That’s why there are entire degree
programs dedicated to management and helping students become great leaders in their
business.

In the world of leadership there are many theories about how leadership works, what
makes good leaders, and how to be effective. There are many leadership styles that
managers can employ and their impact varies based on the group they are leading and the
industry they are in. These leadership theories explain how leadership styles work within a
company to bring success. If you are studying to become a business leader or manager, it’s
important to understand these different leadership theories and how they impact your
leadership and management style.

What isLeadership?

Leadership can be defined as a process by which one individual influences others toward
the attainment of group or organizational goals. Three points about the definition of
leadership should be emphasized. First, leadership is a social influence process. Leadership
cannot exist without a leader and one or more followers. Second, leadership elicits
voluntary action on the part of followers. The voluntary nature of compliance separates
leadership from other types of influence based on formal authority. Finally, leadership
results in followers' behavior that is purposeful and goal-directed in some sort of organized
setting. Many, although not all, studies of leadership focus on the nature of leadership in the
workplace.

What is a leadership theory?

Leadership theories are the explanations of how and why certain people become leaders.
They focus on the traits and behaviors that people can adopt to increase their leadership
capabilities. Some of the top traits that leaders say are vital to good leadership include:

 Strong ethics and high moral standards;

 Great self-organizational skills;
 Efficient learner;
 Nurtures growth in employees; and
 Fosters connection and belonging.

Research shows that these traits are considered the most important to leaders around the
world. And leadership theories help explains how leaders harness and develop these traits.
Recently leadership theories have been more formalized, making them easier to
understand, discuss, and analyze in action.

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Ralph Nader says “The function of leadership is to produce more leaders, not followers.”
This is considered transformational leadership—a leader can alter the perspective or
psychology of a follower and shift them to want to become a leader too. This suggests that at
the end of the day, leadership should be elevating and inspiring. Leaders should push the
people they lead to new heights, helping them to grow into what they know they can
become. Transformational leadership is an important psychological perspective for leaders
to study and understand if they want to really influence and impact others. Different
leadership theories address to create stronger and more effective leadership, helping
followers become encouraged to be leaders themselves.

Major leadership theories

Behavioral theory. The behavioral leadership theory focuses on how leaders behave, and
assumes that these traits can be copied by other leaders. Sometimes called the style theory,
it suggests that leaders aren’t born successful, but can be created based on learnable
behavior.

Contingency theory. The contingency leadership theory, sometimes called situational

theory, focuses on the context of a leader. These theories look at the situational effects of
the success or failure or a leader. A leader’s effectiveness is directly determined by the
situational context. While a leader’s personality is a small factor in their success, the most
important factor is the context and situation of the leader.

Great Man theory. The great man theory of leadership, sometimes called the trait theory,
suggests that good leaders are born. They have innate traits and skills that make them great,
and these are things that can’t be taught or learned. The trait theory suggests that leaders
deserve to be in their position because of their special traits.

Management theory. The management theory is sometimes called transactional

leadership, and focuses on supervision, organization, and group performance. Transactional
leadership is a system of rewards and punishments, and transactional leadership is
regularly used in business. When employees do something successful, managers reward
them. When they fail, they may get punished. Transactional rewards and punishments are
given based on the idea that people really only do things for the reward.

Participative theory. Participative leadership isn’t as common in the corporate world.

Sometimes called democratic leadership, this leadership theory suggests that employees be
directly involved in decision making in their organization. The leader simply facilitates a
conversation and then takes all the suggestions, and comes up with the best possible action.
In this theory, everyone is very involved with decisions for the team and organization, with
the leader simply helping direct the charge.

Power theory. This theory looks at the way a leader utilizes their power and influence to
get things accomplished. French and Raven's Five Forms of Power is a commonly known
power theory of leadership. It looks at positional power and personal power and how they
impact leaders choices and outcomes.

Relationship theory. The relationship theory of leadership focuses on leaders who are
mainly concerned about their interactions with others. They are often mentors for

17
employees, scheduling time to talk to them and working to meet their needs. These kinds of
leaders are focused on making work enjoyable for as many people as possible, and they
want to foster a positive work environment. Studies show that this kind of leadership
behavior can be the most effective for many employees. Relationship-oriented managers
often get better results from their employees.

The Role of Shared Leadership in New Ventures

What is shared leadership?

Shared leadership occurs when managers and subordinates work together on a project
with an emphasis on equal sharing of information and participation.

It is important to distinguish shared leadership from team leadership because shared

leadership describes how team members influence each other and share responsibility for
tasks, rather than the concept of a team being led by a specific leader. Shared leadership
occurs when a group of individuals lead each other to achieve successful outcomes (Carson,
Tesluk, &Marrone, 2007).

According to a study published in the International Journal of Artificial Intelligence and

Agent Technology, shared leadership can be defined as "broadly sharing power and
influence among a set of individuals rather than centralizing it in the hands of a single
individual who acts in the clear role of a dominant superior."

Shared leadership is more of a collaborative effort. One person is still in charge, but power
and influence are shared within the group. This could mean individuals have more
autonomy over decisions related to their position or more of an open-door policy in which
everyone's ideas are given fair consideration.

Why is shared leadership important?

According to the Harvard Business Review, shared leadership leads to better organizational
performance.

Shared leadership has a positive influence on the way a company operates. This model
encourages and values personal initiative. When employees feel empowered to do what
they know they need to do instead of waiting to be told what to do, both productivity and
job satisfaction increase.

When individuals feel that they have an impact on the organization and that they have some
power and responsibility, they have a greater desire for success. Goals become more
personal to them, and people naturally work harder at anything they are personally
invested in.

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"The best examples of shared leadership are when decision making gets spread across
multiple individuals," said Greg A. Chung-Yan, a professor in the Department of Psychology
at the University of Windsor in Ontario.

What are the cornerstones of shared leadership?

The concept of shared leadership focuses on the idea that tasks are shared through a team
environment that relies on (Carson, 2007)

 a shared purpose,
 social support, and
 voice.

Shared purpose: Understand and appreciate collective goals

In fostering a shared purpose, team members understand and appreciate the main
objectives of the team project and ensure that the team focuses on collective goals.

Social support: Provide emotional support to each other

In showing social support, team members provide emotional support to each other through
showing encouragement or recognizing each team member’s individual contributions.

Voice: Appreciate each team member's contribution

The final cornerstone of voice is the ability of each team members to provide input to the
team process. Voice occurs when the team places value and importance on each team
member’s contribution (Carson et al., 2007).

Transformational leadership style

Transformational leadership is a leadership style in which leaders encourage, inspire and

motivate employees to innovate and create change that will help grow and shape the future
success of the company. This is accomplished by setting an example at the executive level
through a strong sense of corporate culture, employee ownership and independence in the
workplace.

Transformational leaders inspire and motivate their workforce without micromanaging —

they trust trained employees to take authority over decisions in their assigned jobs. It’s a
management style that’s designed to give employees more room to be creative, look to the
future and find new solutions to old problems. Employees on the leadership track will also
be prepared to become transformational leaders themselves through mentorship and
training.

Values-Based Leadership

Values-based leadership is a leadership style that builds itself on the values of both the
leader and their team. It's based on the philosophy that people motivate themselves

19
through the implementation of their personal values in their daily lives. Organizations that
follow a shared set of beliefs have employees who are more likely to work together, which
can increase productivity.

Key traits of a values-based leader

Values-based leaders have several traits in common throughout every industry:

 Self-reflection
 Self-confidence
 Humility
 Positive influence

Self-reflection

Values-based leaders take time each day to reflect on their recent decisions and
motivations. Doing so offers them the chance to reevaluate their values, determine their
purpose and discover what really matters to them as leaders. Strong leaders have the
willingness to assess themselves in these areas and the honesty to diagnose the truth.

Self-confidence

All leaders tend to have a degree of self-confidence, but values-based leaders understand
that some leaders are better than them. They also understand that, as leaders, they are
continuously learning and evolving. Values-based leaders understand both their strengths
and weaknesses, surrounding themselves with those who complement their skills.

Humility

Good leaders understand who they are and where they came from. Humility for leaders is
the belief that they are no different than the people who work for them. These leaders
believe that every employee holds just as much value to the company as they do. Humble
leaders do what it takes to lift up their teams and ensure they are well taken care of for their
work.

Positive influence

By exemplifying the company's core values in their work, values-based leaders support
their teams by serving them and ensuring they receive the best benefits in every situation.
They also become excellent examples to all within an organization of what a good leader is.
When presented with a leadership task, other employees often feel encouraged to emulate
their values-based leader, improving the quality of work throughout the organization.

Team-Oriented Leadership

Being team-oriented (or people-oriented) means working well with others and take charge
when a project comes around. It's about focusing on soft skills instead of job-related skills.

20
This contradicts task-oriented leadership. Being task-oriented generally focuses on tasks
completed.

Instead, being team-oriented focuses on the motivations, goals, and well-being of

individuals.

An effective team leader has a variety of traits and characteristics that encourage team
members to follow him. Team leaders naturally possess certain qualities, such as
compassion and integrity, or learn leadership skills through formal training and experience.
The qualities of an effective team leader inspire the trust and respect of the team and
stimulate production within the workplace.

1. A Clear Communicator

Effective team leaders communicate clearly. Quality verbal and written communication
skills allow leaders to present expectations to team members in a way workers can
understand. Effective communication skills also allow team leaders to listen to the input of
others.

2. Strong Organization Skills

Effective team leaders possess exceptional organizational skills. Organizational skills help
team leaders plan objectives and strategies, which allow team members to perform
optimally. Organized team leaders put systems in place that maintain order and guide team
members toward meeting company goals and objectives.

3. Confident in the Team

An effective team leader is confident in his abilities, as well as confident in the abilities of his
team members. A confident leader is secure in the decisions he makes that affect his team. A
self-confident team leader also reassures team members of his authority within the
organization.

4. Respectful to Others

A quality team leader is respectful of his team members. A respectful leader empowers
employees by encouraging them to offer ideas about decisions that affect them. This lets
team members know that the leader respects their input and opinions.

5. Fair and Kind

A quality team leader treats team members fairly. He is consistent with rewards and
recognition, as well as disciplinary action. A fair leader ensures all employees receive the
same treatment.

6. An Example of Integrity

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An effective team leader is honest and open with his team members. Leaders who possess
integrity gain the trust of team members because he does what he says he will do and treats
others the same way he wants to be treated.

7. Influential in Core Areas

Influential leaders help inspire the commitment of team members to meet company goals
and objectives. Influential leaders also help manage change in the workplace by gaining the
confidence of workers through effective decision making and communication.

8. Willing to Delegate

Effective team leaders know how to share leadership through delegation. Delegating certain
tasks to trustworthy team members allows the leader to focus on improving workplace
functions and production.

9. Powerful Facilitator

Effective team leaders are powerful facilitators. As a facilitator, team leaders help workers
understand their goals. They also help organize an action plan to ensure team members
meet their goals and objectives more efficiently.

10. A Skilled Negotiator

Team leaders utilize negotiation skills to achieve results and reach an understanding in the
event of a workplace conflict. Team leaders who negotiate effectively streamline the
decision-making process, as well as solve problems for the best interest of everyone
involved.

Entrepreneurship Leadership Style

Risk-taking Leadership.Risk-taking is an indispensable part of leadership. When we look at

leaders who are making a difference we see that they have the courage to begin while
others are waiting for a better time, a safer situation, or assured results. They are willing to
take risk because they know that being over cautious and indecisive kills opportunity.
Leaders understand that if they are to prosper in the 21st century they must use their risk-
taking abilities to create an environment that encourages innovation and creativity.

Proactive and Visionary Leadership.Proactive leadership is about taking time to plan,

improve how your team works and putting measures in place to prevent problems before
they happen. Proactive leadership is about identifying areas of risk for your team, and
working on measures that will reduce their impact, or stop the problems happening
altogether.The proactive leader sees problems just as they are starting to grow, or even
before they begin, and calmly takes quiet and gentle steps to correct and avert so that the
conflicts and disruptions are minimized or even completely prevented.

22
Innovation leadership.Innovation leadership is a philosophy and technique that combines
different leadership styles to influence employees to produce creative ideas, products, and
services. The key role in the practice of innovation leadership is the innovation leader.The
innovation leaderhas the ability to inspire productive action in yourself and others during
times of creation, invention, uncertainty, ambiguity, and risk. It is a necessary competency
for organizations that hope to develop truly innovative products and services.

Charismatic Leadership.Charismatic leadership is defined by a leader who uses his or her

communication skills, persuasiveness, and charm to influence others. Charismatic leaders,
given their ability to connect with people on a deep level, are especially valuable within
organizations that are facing a crisis or are struggling to move forward.

Creative leadership is the ability to create and realize innovative solutions especially in the
face of structurally complex or changing situations. It refers to those people who, when all is
shifting and new approaches are yet unknown, can still create clarity of purpose for their
teams. These are leaders who seek to navigate – and even benefit from – the
unpredictability around them. Not just for the organization or themselves, but usually also
for society at large and the ecology of the planet.

23
Assessing Learning

Name: ________________________________________ Date:________________

Course/Year/Section: _____________________ Score: ______________

Activity

Direction:Write the correct answer on the space provided.

__________________________________ 1.is a social influence process

__________________________________ 2. is a leadership style in which leaders encourage, inspire
and motivate employees to innovate and create change that
will help grow and shape the future success of the company.
__________________________________ 3.is a leadership style that builds itself on the values of both
the leader and their team.
__________________________________ 4.is about taking time to plan, improve how your team
works and putting measures in place to prevent problems
before they happen.
__________________________________ 5.are a vital part of effective business practices
__________________________________ 6.are the explanations of how and why certain people
become leaders.
__________________________________ 7.defined as "broadly sharing power and influence among a
set of individuals rather than centralizing it in the hands of
a single individual who acts in the clear role of a dominant
superior"
__________________________________ 8.leads to better organizational performance
__________________________________ 9.can be defined as a process by which one individual
influences others toward the attainment of group or
organizational goals.
__________________________________ 10.occurs when managers and subordinates work together
on a project with an emphasis on equal sharing of
information and participation.

Enumerate the following:

1. Major Leadership Theories

2. Entrepreneurship Leadership Style
3. Transformational Leadership Style

24
Assessing Learning

Name: ________________________________________ Date:________________

Course/Year/Section: _____________________ Score: ______________

Activity

Discuss the following:

1. Major leadership theories

2. Entrepreneurship leadership style
3. Shared leadership

25
Assessing Learning

Name: ________________________________________ Date:________________

Course/Year/Section: _____________________ Score: ______________

Activity

Essay.

1.Define and discuss the importance of the following traits associated with leaders:
intelligence, self-confidence, determination, integrity, and sociability. Is this list all-
inclusive?
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________

2. Choose one of the main traits associated with leaders. How can it be developed?
Demonstrated to others? Identify one or two people who have this trait. How does it serve
them in their leadership role?

_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________

3. Is charisma an inborn trait or can it be acquired later on in life? How might a person
acquire charisma?

_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________

26
4. What are some leadership challenges today? (e.g., economic policy, climate change, and
world hunger). Which of the leadership traits on Table 2.1 are most relevant to address that
challenge? Are any traits needed by leaders today that aren’t listed here?

_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________

5. Can introverts become effective leaders? What additional traits do they need to develop
in order to do so?

_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________

27
References:

Leadership Theories and Styles (wgu.edu)

https://www.wgu.edu/blog/leadership-theories-styles2004.html

Values-Based Leadership: Traits and Benefits | Indeed.com

https://www.indeed.com/career-advice/career-development/values-based-leadership

https://www.businessnewsdaily.com/135-shared-leadership-social-media-fuel-business-
growth.html

https://blog.weekdone.com/how-to-have-team-oriented-leadership/#:~:text=Defining
%20Team%2DOriented%20Leadership,generally%20focuses%20on%20tasks
%20completed.

https://smallbusiness.chron.com/leadership-styles-production-management-13299.html
https://medium.com/lightshed/what-is-innovation-leadership-8094f79620ca
What Is Charismatic Leadership? | Torch
https://torch.io/blog/what-is-charismatic-leadership/
https://www.thoughtfulleader.com/proactive-leadership/#:~:text=Proactive
%20leadership%20is%20about%20taking,stop%20the%20problems%20happening
%20altogether.
https://www.thnk.org/insights/the-need-for-creative-leadership/#:~:text=Creative
%20leadership%20is%20the%20ability,of%20purpose%20for%20their%20teams.
https://finsecurity.com/finsecurity/quotes/mm0110.html

28
 Unit 3
Understanding Leadership Styles and Theories
Overview
This unit discusses the core beliefs of successful entrepreneurs.This unit also
includesentrepreneurial vision, mission, and values, and organizational culture and
communication.

Learning Objectives

At the end of this unit, I am able to:

 discuss the core beliefs of successful entrepreneurs;
 explain the role of entrepreneurial vision, mission, and values; and
 describeorganizational culture and communication.

Setting Up

Name : ____________________________________ Date: _______________

Course/Year/Section: ____________________

Directions: What do you want your life to look like ten to twenty years from now? Consider
these questions:

A Personal Vision Statement

Where are you living?

What are you doing for a living?

What does your home look like?

Who lives in your home?

What are you doing with your life?

You could describe a typical workday and weekend day in your life as part of answering these
questions. Create a vision statement that describes the answers to these questions.

______________________________________________________________________________________________

______________________________________________________________________________________________

______________________________________________________________________________________________
______________________________________________________________________________________________

29
Lesson Proper

7 Core Beliefs of Successful Entrepreneurs

Every day, new businesses are started but most of these do not last until the end of the year.

What could be the reason why some entrepreneurs make it and some fail? Starting a
business is not a very simple undertaking.

In fact, it is one of the most challenging feats that a person can start.

There are too many things that an individual must possess in order to effectively launch his
or her own business and these include any or all of the following: money, education, skill,
and luck.

Launching a business does not immediately denote its success, though. It will take months
and years of hard work in order to make the business gain profit and for it to thrive. In
addition, successful entrepreneurs reveal that the secret to their victory is having the right
mindset and the following core beliefs:

1. It’s Not Just About The Money.

While profit is the main purpose of every business, it shouldn’t be the most important thing
to an entrepreneur.

Many businessmen that have become a success in their trades give more value to the
satisfaction and the fulfillment that they receive from their businesses. The money is just a
secondary thing. They give importance to the product that they produce or the services that
they provide for their consumers.

In addition, a good businessman must give importance to his employees for without them,
the company cannot operate. Many successful businesses provide competent salaries and
excellent benefits to their employees. They make sure that the workers are well-
compensated. They know that happy employees will give their best in their work, producing
superb results for the company whereas discontented workers will not work so hard and
will provide mediocre to poor work performance.

2. Desire and Determination To Succeed

Of course all entrepreneurs hope to be successful. However, not all have the real desire to
make it. When you want your business to survive, you must really, really want it to. You
must want it more than anything else. This means that your determination to make your
business thrive is above the average determination. You must be able to give your all to

30
your business, doing everything that you can, and even making sacrifices in order for your
business to thrive.

3. Optimism and Having A Vision

Having troubles in your business is normal but how you handle these problems is what
makes the difference. You can’t just quit and give up on your dream every time you are
faced with a setback. You have to believe that there is a positive turnout for each problem
that you encounter.

Moreover, it would help if you already have a solid vision in your mind that you can
succeed. Being pessimistic is not very helpful in running a business. For how can you
succeed if you always think that you will not make it anyway? Think positive and envision a
thriving and profitable business ahead of you.

4. Have Courage and Believe In Yourself

If you possess the right skills and you have armed yourself with sufficient knowledge about
your business, then you have no need to worry and there is no need for you to lose your
confidence in the middle of managing your business.

If you think that you are capable and competent in your field, then this can help you a lot in
your journey as an entrepreneur. And when you encounter moments that you are losing
your confidence, just take steps to enrich yourself with more helpful knowledge about our
field.

Take specialized classes, enroll in a university course, attend seminars and symposiums,
and do everything to make yourself a better entrepreneur.

Courage also goes hand in hand with confidence when it comes to business. You must be
able to make important decisions for your company. Don’t be afraid to take big steps and
perhaps take some risks if you feel that it could be good for your company. For instance, you
should be able to decide whether to close a branch and relocate to a bigger place in a new
location or just keep the existing branches and open a new one.

Whatever the outcome later on, the important thing is that you had the courage to make the
decision and was able to stand up for it.

5. Passion for Your Field

Starting a business in a field that you have no passion for can be very difficult and can be an
unwise decision. It can be a waste of money and in addition, you may not have a very big
chance to succeed as you have no natural interest for the kind of business that you have
started.

31
In general, it is better to start the kind of business where you are most knowledgeable and
have natural interest for. For instance, if you love cooking, then a bakery or a restaurant can
be your best choice.

Don’t open a business that you hate or don’t care for just because it’s the trend today. Well,
you can always hire someone else to run it for you but still it’s better to operate a business
that you know about and love because your chances of being successful at managing it is
higher.

6. Stay Focused

When you’re in the middle of your operation, it can be very easy to lose your focus. It can
start by being attracted to other kinds of business and just giving up what you started. You
may even lose your interest in your existing business and move on to other industries. This
can happen especially if the business is in a slump or is not very profitable. While some can
still become successful by moving on to other industries, it can bankrupt other
entrepreneurs.

Giving up on the business that you have started is a waste of investment in money, time, and
effort. When tough times come or when you get bored, you just have to stick to the business
that you created. Develop it and find ways to recreate the products or services that you offer
so that it can still become interesting for you and for your customers.

For instance, a boring coffee shop can be recreated to become an internet café, where
people can browse the net while having coffee. You can even add cupcakes and pastries to
your products. Stay focused on your dream and give extra efforts to stay in business.

7. Hard Work and Self-Discipline

You can never expect to be successful at anything without working hard for it. I’ve read
somewhere that successful entrepreneurs work harder than their employees by putting in
more hours at work. Businesses that thrive have bosses that don’t follow the regular 8-hour
working time. They just don’t see any time limit to working.

Why is that? Well, they have given all their time and their lives to the company that they
have started and so they do not think that they have a limit in the time that they should be
putting in for their company. However, some business owners make the mistake of thinking
that they no longer need to work so hard since they are the boss.

You should have self-discipline not only in working hard but also in how you handle the
money. You can’t use all of your profits for personal things.

Most businesses become bankrupt when the boss starts overspending and using all of the
money for himself. While it is tempting to spend all the profits, you have to make sure that
the money for the company’s smooth operation is allocated and secure.

32
The triumph of any business can be attributed to a number of things. However, the
entrepreneur’s values play a very big role in the outcome of his or her company. If you
adapt these important beliefs that many thriving businessmen share, you too can be among
the victorious entrepreneurs in the future.

Entrepreneurial Vision

Vision is an important part of everyone’s future, and this is especially true for
entrepreneurs. Establishing your vision is the first of several steps toward making your
venture a reality.

Every successful entrepreneur that you encounter or read about likely started with an
image or idea related to something he or she felt passionate about creating. This occurs
even when the person has no idea how (or if) what they desire to accomplish or create will
become a reality. An entrepreneur’s vision is the start of a roadmap that will determine
where he or she wants to go with their entrepreneurial efforts. Vision speaks to what the
entrepreneur wants the business to look like in the future—perhaps five or ten years out.
Unfortunately, many potential entrepreneurs have dreams and ideas but never develop a
concrete vision. A vision statement is the picture you have for what the venture will
become in the future: what it will grow into. Be aware, though, that oftentimes, the
identified vision at the start of the venture changes into something different. In later
chapters, we discuss how this change requires open-mindedness and a willingness to adapt.
The mission statement is a formal declaration about what the venture will do, what value it
will provide to the end customer, and how it will accomplish this action. In describing your
mission, carefully think about the value proposition that you provide. The value proposition
is a summary statement that conveys the benefits your product, service, or unique business
process/model provides to customers. This relates back to the perspective of problem
solving. Not only do you need to solve the problem, but you also must provide value. We
might solve a problem, but if the value proposition isn’t relevant or seen as “real” by the
customer, the venture will probably not be successful. Both concepts of a future vision and
the mission of the venture should be formalized into statements.

An entrepreneurial vision considers what you want your venture to become, what this
venture will look like, what the driving forces are, and what values and culture should
surround it. Each individual entrepreneur has a unique picture of what the venture will
become.

Mission, Vision, and Values

Mission and vision both relate to an organization’s purpose and are typically communicated
in some written form. Mission and vision are statements from the organization that answer
questions about who we are, what do we value, and where we’re going.

33
A mission statement communicates the organization’s reason for being, and how it aims to
serve its key stakeholders. Customers, employees, and investors are the stakeholders most
often emphasized, but other stakeholders like government or communities (i.e., in the form
of social or environmental impact) can also be discussed. Mission statements are often
longer than vision statements. Sometimes mission statements also include a summation of
the firm’s values. Values are the beliefs of an individual or group, and in this case the
organization, in which they are emotionally invested. The Starbucks mission statement
describes six guiding principles that, as you can see, also communicate the organization’s
values:

 Provide a great work environment and treat each other with respect and dignity.
 Embrace diversity as an essential component in the way we do business.
 Apply the highest standards of excellence to the purchasing, roasting and fresh
delivery of our coffee.
 Develop enthusiastically satisfied customers all of the time.
 Contribute positively to our communities and our environment.
 Recognize that profitability is essential to our future success.

A vision statement, in contrast, is a future-oriented declaration of the organization’s

purpose and aspirations. In many ways, you can say that the mission statement lays out the
organization’s “purpose for being,” and the vision statement then says, “based on that
purpose, this is what we want to become.” The strategy should flow directly from the vision,
since the strategy is intended to achieve the vision and thus satisfy the organization’s
mission. Typically, vision statements are relatively brief, as in the case of Starbuck’s vision
statement, which reads: “Establish Starbucks as the premier purveyor of the finest coffee in
the world while maintaining our uncompromising principles as we grow.”

Roles Played by Mission and Vision

Mission and vision statements play three critical roles: (1) communicate the purpose of the
organization to stakeholders, (2) inform strategy development, and (3) develop the
measurable goals and objectives by which to gauge the success of the organization’s
strategy. These interdependent, cascading roles, and the relationships among them, are
summarized in the figure.

34
 Key Roles of Mission and Vision

First, mission and vision provide a vehicle for communicating an organization’s purpose
and values to all key stakeholders. Stakeholders are those key parties who have some
influence over the organization or stake in its future. You will learn more about
stakeholders and stakeholder analysis later in this chapter; however, for now, suffice it to
say that some key stakeholders are employees, customers, investors, suppliers, and
institutions such as governments. Typically, these statements would be widely circulated
and discussed often so that their meaning is widely understood, shared, and internalized.
The better employees understand an organization’s purpose, through its mission and vision,
the better able they will be to understand the strategy and its implementation.

Second, mission and vision create a target for strategy development. That is, one criterion of
a good strategy is how well it helps the firm achieve its mission and vision. To better
understand the relationship among mission, vision, and strategy, it is sometimes helpful to
visualize them collectively as a funnel. At the broadest part of the funnel, you find the inputs
into the mission statement. Toward the narrower part of the funnel, you find the vision
statement, which has distilled down the mission in a way that it can guide the development
of the strategy. In the narrowest part of the funnel you find the strategy —it is clear and
explicit about what the firm will do, and not do, to achieve the vision. Vision statements also
provide a bridge between the mission and the strategy. In that sense the best vision
statements create a tension and restlessness with regard to the status quo—that is, they
should foster a spirit of continuous innovation and improvement. For instance, in the case
of Toyota, its “moving forward” vision urges managers to find newer and more
environmentally friendly ways of delighting the purchaser of their cars. London Business
School professors Gary Hamel and C. K. Prahalad describe this tense relationship between
vision and strategy as stretch and ambition. Indeed, in a study of such able competitors as
CNN, British Airways, and Sony, they found that these firms displaced competitors with
stronger reputations and deeper pockets through their ambition to stretch their
organizations in more innovative ways.Hamel, G., &Prahalad, C. K. (1993, March–April).
Strategy as stretch and leverage. Harvard Business Review, 75–84.

Third, mission and vision provide a high-level guide, and the strategy provides a specific
guide, to the goals and objectives showing success or failure of the strategy and satisfaction
of the larger set of objectives stated in the mission. In the cases of both Starbucks and
Toyota, you would expect to see profitability goals, in addition to metrics on customer and
employee satisfaction, and social and environmental responsibility.

35
Organizational culture

Organizational culture is a set of shared assumptions that guide what happens in

organizations by defining appropriate behavior. It can simply be viewed as “the way we do
things”. It includes an organization’s expectations, experiences, philosophy, vision, customs,
values, norms, beliefs, and habits - written and unwritten rules that have been developed
over time. It also defines behavior, such as what is encouraged, discouraged, accepted, or
rejected within an organization.

Defining Organizational Culture

Before an organization can understand its own culture, it is helpful to dig further into
organizational culture. What are its attributes? How can it be explained or defined?

Groysberg et al. note that there are many formal definitions of organizational culture and a
variety of models and methods for assessing it, but agreement is sparse. They identified four
generally accepted attributes:

Shared: Culture is a group phenomenon - it does not exist at an individual level. It lives in
shared behaviors and values. It is most commonly experienced through the norms and
expectations of a group - especially the unwritten rules.

Pervasive: Culture can be found everywhere in an organization; sometimes it is part of the

organizational identity. It can be seen in collective behaviors, physical environments, visible
symbols, stories, and legends. Other aspects of culture are less visible, including mindsets
and motivations.

Enduring: The type of culture in an organization can last for a long period of time. Lengthy
existence can be explained partially by the attraction-selection-attrition model, i.e. people
are drawn to organizations with characteristics they find appealing; organizations are more
likely to select individuals who seem to “fit in”; and over time those who don’t fit in tend to
leave. It becomes self-reinforcing and also more difficult to change.

Implicit: Culture is subliminal in nature as people instinctively recognize and respond to it -

it acts as a kind of “silent language”.

Organizational Communication

Effective communication is a building block of successful organizations, In other words,

communication acts as organizational blood.

All managers and employees need to be aware of how people behave in order to provide the
best working environment. Organizational behavior is about how people may be motivated
to work together in more effective ways. The interaction required to direct a group toward
a set of common goals is called organizational communication.

36
The importance of communication in an organization can be summarized as follows:

1. Communication promotes motivation by informing and clarifying the employees about

the task to be done, the manner they are performing the task, and how to improve their
performance if it is not up to the mark.
2.Communication is a source of information to the organizational members for decision-
making process as it helps identifying and assessing alternative course of actions.
3. Communication also plays a crucial role in altering individual’s attitudes, i.e., a well-
informed individual will have better attitude than a less-informed individual. Organizational
magazines, journals, meetings and various other forms of oral and written communication
help in molding employee’s attitudes.
4. Communication also helps in socializing. One cannot survive without communication.
5. Communication also assists in controlling process. It helps controlling organizational
member’s behavior in various ways. There are various levels of hierarchy and certain
principles and guidelines that employees must follow in an organization. They must comply
with organizational policies, perform their job role efficiently and communicate any work
problem and grievance to their superiors. Thus, communication helps in controlling
function of management.

An effective and efficient communication system requires managerial proficiency in

delivering and receiving messages. A manager must discover various barriers to
communication analyze the reasons for their occurrence and take preventive steps to avoid
those barriers. Thus, the primary responsibility of a manager is to develop and maintain an
effective communication system in the organization.

So, organizational communication refers to the forms and channels of communication

among members of organizations such as corporations, nonprofits or small businesses.
Studies have found a strong relationship between the levels of communication in an
organization and job performance and satisfaction. Organizational communication can be
formal or informal, flow in various directions and make use of various media.

External vs. Internal Communications

Internal and external communications are considered to be very important resources of

business communication.

Internal communication is information and ideas exchange within the organization itself.
In internal communication, messages can be exchanged via personal contact, telephone, e-
mail, intranet or modern employee communication platforms.

There are 4 types of internal communication:

Vertical - communication between employees on different hierarchical positions

Downward - communication from managers or leaders to employees

Upward - communication from employees to managers or leaders

37
Horizontal - communication between individuals on the same hierarchical positions

Unlike internal communication, external communication means exchange of information

both within the organization itself and outside the organization.

Organizations communicate with the outside world on a daily basis. Therefore, external
comms departments play a very important role in every business.

External communication can be formal and informal.

Formal external communication is the very first step in creating the appropriate company
image. It includes anything from carefully created letters, reports, presentations or web
pages. The main goal of external comms is to inform the outside world an important
message about the work and quality of the organization.

Informal external communication is a form of communication which organizations can’t

regulate directly.

38
Assessing Learning

Name: ________________________________________ Date:________________

Course/Year/Section: _____________________ Score: ______________

Activity

Direction:Write the correct answer on the space provided.

__________________________________ 1. considers what you want your venture to become, what

this venture will look like, what the driving forces are, and
what values and culture should surround it.
__________________________________ 2.is a building block of successful organizations, In other
words, communication acts as organizational blood.
__________________________________ 3.The interaction required to direct a group toward a set of
common goals
__________________________________ 4. communicates the organization’s reason for being, and
how it aims to serve its key stakeholders.
__________________________________ 5.refers to the forms and channels of communication among
members of organizations such as corporations, nonprofits
or small businesses.
__________________________________ 6. is a future-oriented declaration of the organization’s
purpose and aspirations.
__________________________________ 7. is the start of a roadmap that will determine where he or
she wants to go with their entrepreneurial efforts.
__________________________________ 8. are those key parties who have some influence over the
organization or stake in its future.
__________________________________ 9.is information and ideas exchange within the organization
itself. In internal communication, messages can be
exchanged via personal contact, telephone, e-mail, intranet
or modern employee communication platforms.
__________________________________ 10. is the picture you have for what the venture will become
in the future: what it will grow into.
__________________________________ 11. means exchange of information both within the
organization itself and outside the organization.
__________________________________ 12. communication between employees on different
hierarchical positions
__________________________________ 13. is a form of communication which organizations can’t
regulate directly.
__________________________________ 14. communication from employees to managers or leaders
__________________________________ 15. communication between individuals on the same
hierarchical positions

39
Assessing Learning

Name: ________________________________________ Date:________________

Course/Year/Section: _____________________ Score: ______________

Activity

Direction: Discuss the Key Roles of Mission and Vision

40
Assessing Learning

Name: ________________________________________ Date:________________

Course/Year/Section: _____________________ Score: ______________

Activity

Answer the following questions:

1. What is a mission statement?

2. What is a vision statement?

3. How are values important to the content of mission and vision statements?

4. Where does the purpose of mission and vision overlap?

5. How do mission and vision relate to a firm’s strategy?

6. Why are mission and vision important for organizational goals and objectives?

41
References:

7 Core Beliefs Of Successful Entrepreneurs • Brand Glow Up

https://www.brandglowup.com/beliefs-successful-entrepreneurs/

https://openstax.org/books/entrepreneurship/pages/1-2-entrepreneurial-vision-and-
goals#:~:text=An%20entrepreneurial%20vision%20considers%20what,what%20the
%20venture%20will%20become.

Retrieved October 27, 2008, from http://www.starbucks.com/aboutus.

The Roles of Mission, Vision, and Values (lardbucket.org)

https://2012books.lardbucket.org/books/management-principles-v1.1/s08-02-the-roles-
of-mission-vision-an.html

Organizational culture and its mission, vision and values - Organizational culture and its mission,
vision and values - UNECE Statswiki
https://statswiki.unece.org/display/SCFP/Organizational+culture+and+its+mission
%2C+vision+and+values

Chapter 1: Introducing Organizational Communication – Organizational Communication

(pressbooks.pub)
https://granite.pressbooks.pub/organizationalcommunication/chapter/chapter-1/

https://blog.smarp.com/12-reasons-why-internal-external-communications-go-hand-in-
hand

42
 Unit IV
Imagery and Values in Entrepreneurial Vision

Overview

This unit discusses the concept of entrepreneurial visions, values and imagery.

Learning Objectives

At the end of this unit, I am able to:

1. explain the entrepreneurial vision; and
2. discuss the creative approach in entrepreneurial leadership.

Setting Up

Name : ____________________________________ Date: _______________

Course/Year/Section: ____________________

Direction: A successful entrepreneur finds solutions to problems.

Describe the values of a good entrepreneur in your own words.

Values Describe the values in How will you use the

your own words values to create a
successful business
Bravery

Vision

Respect for self and others

Trust

Honesty

Generosity

Fortitude

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Lesson Proper

Creative Approaches to Developing Your Vision

There are many definitions of and ways to express creativity (you will learn more about
creativity in (Creativity, Innovation, and Invention). Artists typically show their creative
side in their art, musicians show their creativity through music, and writers express their
creativity in writing. Others express technical creativity through cell phone innovations or
new car technology. It is up to you to determine how you will express your creativity in
your venture and in your professional life. In most cases, when people follow their passions,
their creativity flows from that passion.

One approach to discovering your vision for your future is to begin with the end in mind.
What picture of your desired future do you have in mind? How could this vision fit with the
ideas you have of creating a successful venture? Notice that these questions are about both
your personal future and the vision for your venture’s future. These two pictures should
coexist. The vision for your personal future should allow for the necessary resources to
support the venture’s future, just as the venture’s future will provide for your personal
future. We will discuss work-life balance later in the chapter to help you identify what
creates success as you describe your vision.

Another approach to developing your vision is to use a creative thinking process. This type
of thinking allows people to come up with ideas that they might not have had without
adopting a creative mindset. The creative thinking process (covered in more depth
in Creativity, Innovation, and Invention) has four steps: preparation, incubation,
illumination, and verification (Figure 1.8).

In the preparation stage, gather information and collect ideas. As part of the process of
tapping into creative ideas, you can apply divergent thinking by generating as many ideas
as possible, even when those ideas do not seem logical. Create a list of conflicting ideas, or
ideas that are diverse and disparate. Preparation is the first step of the creative thinking
process. The next action is to walk away from thinking about the activity: incubation. We

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are programming our minds to realize that the work done in preparation is an important
topic for consideration. When we walk away from consciously thinking about the activity or
problem, we allow our unconscious minds to continue to think about the activity, even
though our conscious minds are busy doing other things. This incubation period is essential
for advancing creativity. In the incubation stage, you might go for a walk, take a nap, or just
continue with your daily activities. At some point, you may have a sudden inspiration
or illumination—an aha! moment—that clearly addresses the activity or problem you want
to solve. In this step, the answer often pops into our conscious minds, and we recognize how
to proceed. The last step is verification, crafting our vision statement or message, or
responding to the exercise in creative thinking. You can apply this creative thinking process
to many different business situations. Once we further develop and crystallize our ideas
(the Business Model Canvas discussed in Launch for Growth to Success is a good tool for
this activity), we provide an opening for a creative and viable solution as we continue to
think about the issue.

Design thinking, brainstorming, and mind mapping are tools that you will learn about later
in the course. Although these tools may be familiar, there are specific methodologies that
can optimize their success in entrepreneurial situations. Brainstorming requires that
participants generate ideas around the desired topic without judgment. You can do this
alone or with others, but including other people provides a greater variety of ideas, as one
person’s ideas might trigger another idea from someone else. Be sure to write down your
thoughts so that you can return to them later. Brainstorming is different from divergent
thinking, which does not require ideas to be associated with the identified topic. For
example, in brainstorming on the topic of helping the homeless population, we might come
up with ideas such as finding community food and housing, or providing free medical care.
Using divergent thinking, we would arrive at more diverse ideas, such as filming homeless
people then uploading the videos to a social media website to connect family members with
the homeless person. These tools could incorporate divergent thinking in the idea-
generation step, but typically, unless people are taught how to use divergent thinking, the
ideas generated are more structured and constrained, and more logical. As much as we
want to encourage divergent ideas, we also want to discourage any judgment around our
ideas. Once we start judging our ideas, we restrict our creativity and end up with less than
ideal solutions. Approach this process with some playfulness and relaxation.

Mind mapping is another popular technique for creative thinking. Here, you create an
illustration on paper or a chalk board. Write down the words that come to mind then link
those words together with lines in a diagram that shows how each word relates to the
others. The idea is that one word can lead to another. You can discover associations that
might not have been evident before you created the mind map.

You can conduct research on entrepreneurial ideas by creating surveys and asking people
questions about their experiences related to your idea. For example, let’s say you are
considering creating a new non-messy health food that can be eaten while commuting to
work. You could ask people about their experiences eating while commuting to work or ask
questions about nutritional concerns or diets. Or you could find secondary data on when
people eat, eating while commuting, popular diets, or other related topics. Or you could find
case studies that focus on a few in-depth similar areas of interest or perform your own case
studies by selecting a few peers to track their eating habits. Or you could create a prototype
of your product and ask people to tell you about their experience using your product. You
will learn more about research strategies in Identifying Entrepreneurial

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Opportunity, Problem Solving and Need Recognition Techniques, and Entrepreneurial
Marketing and Sales.
Achieving Balance
Entrepreneurship comes with many challenges because the entrepreneur must wear many
hats. This is especially true if the entrepreneur is the only employee in the business. But
regardless of the business model, all entrepreneurs must be able to achieve balance in their
lives between their dedication to growing their entrepreneurial venture and their personal
life. Developing a vision that includes different areas of your professional and personal life
can help make this type of balance achievable.
How do you define balance in your life? What areas do you consider when you think about a
balanced life? Having enough money to support your lifestyle might be one goal. Other areas
might include physical activities or hobbies, social interactions and entertainment,
satisfaction with how you earn money, your family and personal relationships, and other
interests and values. Some entrepreneurs start lifestyle ventures to achieve this balance.
But how do we achieve balance when our goal is to be a career entrepreneur?

A career entrepreneur is someone who takes on the daily management as the owner of
the venture, accepting, and perhaps enjoying, the daily risks and rewards of managing and
building the venture such as Roxanne Quimby. For Roxanne Quimby, growing Burt’s
Bees involved making difficult decisions, such as relocating from Maine to California to meet
the growth needs of the company. Even though Roxanne wanted to provide employment
opportunities to people in northern Maine, she knew that her business needed the right
infrastructure for success, and that infrastructure wasn’t available in Maine. If you choose to
become a career entrepreneur, your focus may be primarily on advancing your
entrepreneurial idea into a successful venture, like Roxanne did with Burt’s Bees; this can
come at the expense of personal life goals.

Many career entrepreneurs need support from family and friends who accept that the lead
entrepreneur’s attention and energy are required for the success of the venture, and many
lifestyle entrepreneurs will find challenges in meeting the needs of the venture while
maintaining work-life balance. Discussions with family, close connections, and the
entrepreneurial team should occur in the early idea-formulation stage to gauge the support
of the people whose interests might be compromised by the entrepreneur’s dedication to
advancing the venture.

Clearly defining your idea of success for your life, and for your venture, is an important step
in achieving balance. What are your priorities? What can you do to balance the success of
your new venture, the success of your own life, and the success of your family? Considering
that balancing all the roles that we have in life is a frustration point for many people, can
you find an opportunity to create an entrepreneurial venture?

As you explore what success means for your venture and how your definition aligns with
balance between your personal life and dedication to your venture, you should consider
some of the unique challenges entrepreneurs can face. For example, there might be a
learning curve in unfamiliar areas of business, such as accounting or finance. Or you might
face a dilemma about whether to expand a product line, or whether or where to open a new
location. Entrepreneurs often mention the physical requirements of starting up a business.
Physical demands can include the sheer stamina needed to clean a new space, move in, and
set up shop. Depending on your business, you also might need to adjust to being on call

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twenty-four/seven. Here again, developing a vision of where you want to be in the future
can help you plan for the challenges you will face in the early stages of your business.

Entrepreneurship can be especially draining if you are not prepared for the tasks at hand—
as can be the case with any professional or personal role. Therefore, self-care and emotional
awareness can play a key role in maintaining your emotional health as an entrepreneur.
Taking time for yourself is very important. This could involve creating a time management
calendar. Tracking how you spend your time can keep you on schedule with tasks and
prevent you from expending too much on any one area of the business or your personal life
in detriment to the other. Taking time away from the business is emotionally healthy and
can provide important perspective that can help you make better decisions. “Leaving work
at the office” is a successful strategy that many business people use to separate their
personal and professional lives. If this is not possible—for example, if you work from home
—setting aside family or personal time can allow for work-life balance.

Having trusted advisors and mentors for your business and personal life can also promote
emotional health. When you face a decision or challenge that you have difficulty with, it is
important to have someone to talk to who knows you and knows your situation. Some
entrepreneurs may find themselves in their first experience of leading others, with total
responsibility for the outcomes as owner of the business. Every business person should
have a personal leadership improvement plan. This plan can take the form of academic
classes or professional coaching, but sometimes, it will be a personal commitment to
improvement. You should identify your preferred leadership styles, as well as leadership
strengths and weaknesses. It might be useful to look back on your own work experiences to
identify which leadership traits you admired and which ones you didn’t. As with any other
business skill set, you can learn and improve these strengths in yourself. You also can hire
people with complementary skills to handle the areas that you feel unsure about.

Being aware of your own strengths and weaknesses, as well as of your preferences and
dislikes, will help you achieve and maintain balance in your life. Having counselors,
mentors, advisors, checklists, and timelines can keep you on track and prevent any one area
of your business or personal life from taking over or being neglected.

Importance of Images in Business

People rely on imagery to share information, learn about new ideas and educate themselves
on things that interest them. Using images in a business works much the same way, helping
people get a feel for your product or service without solely relying on written messages. The
key is to use high-quality images, photos and illustrations that do justice to what your
company sells so people get excited and want to learn more.

Builds Credibility and Brand

Using imagery to build credibility and to bond with prospects and customers makes photos
and illustrations important tools. If potential buyers can clearly see the features of a
product you’re selling, they feel more confident that you’re selling what you promise. Plus,
high-quality images that clearly demonstrate your product, service, vision or company
values help build brand when you use them in your marketing strategies.

Makes Message More Interesting

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Some people are more apt to pay attention to visuals than text. For instance, if your target
market prefers photos rather than text, using photos or illustrations becomes a necessity
for convincing prospects to buy. Or, you may need to appeal to both those who rely on
visuals as well as prospects who need reading material. Imagery also helps attract people
who scan ads, literature or website photos and illustrations to get a quick feel for whether
or not they want to read the finer print about your product or service.

Tells Your Story

The old saying, “a picture is worth a thousand words,” comes true when an image helps tell
your company story. Whether you sell a complex idea, technical product or a simple service
that requires almost no explanation, imagery helps explain why your company’s offering is
the best choice. You also can use imagery to explain the history of your company or to
provide background on a product or service you sell as a way of showing you understand
the market and are on top of new trends. For example, if you sell luxury cars and your target
market is young, influential buyers, photos of young, successful drivers wearing the latest
fashions helps tell your story while showing who your product is intended for.

Explains Customer’s Point of View

Encouraging customers to post images of how they use your product or service on your
social media pages gives you a way to share success stories. This helps build credibility.
Plus, the images people post may help you spot ways to improve your product or service. Or
you may discover a benefit customers like about your company’s offerings that you haven’t
focused on yet in your marketing and promotional efforts. For instance, if several customers
post a photo that shows them using your product in a new way, that imagery tells you it’s
time to research this new benefit for potential use in your advertising efforts.

The Values That Sustain Entrepreneurs

Guiding Values
What values may be particularly important in guiding the entrepreneur?

Bravery. In recognizing and pursuing and opportunity, an entrepreneur requires bravery.

Bravery, which springs from natural creativity and a determined spirit, helps the
entrepreneur deal with discouragement and even defeat in the early stages of company
formation.

Vision. Vision guides the entrepreneur through the business planning process, clarifying the
opportunity and setting goals for the organization. Vision allows the entrepreneur to see
past his or her current position and beyond limited resources to more fully appreciate the
potential of the venture.

Respect for self and others. Respect for one’s self and others is essential. It enables the
individual to appreciate his or her efforts, relate effectively to family and community, and
motivate others. This respect, which stems from pride, hope, and enthusiasm, frees
entrepreneurs from the obstacles of low self-esteem, hopelessness, and anger.

Trust. Trust is an indispensable part of the marketing effort as the company grows. Trust,
which results from reliability, compassion, and gentleness, permits the entrepreneur to

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overcome mistrust, selfishness, and ruthlessness as the company deals with employees,
customers, and vendors.
Honesty. An entrepreneur must be honest in financing the company and managing the
assets of the firm. Honesty, which emanates from decisiveness in taking risks and making
choices, lets the entrepreneur avoid false security and stay calm amid confusing situations.

Generosity. In directing the management and operations of a growing business, an

entrepreneur should be generous. Generosity, which develops from supporting and leading
others, permits an entrepreneur to eliminate racial bias, reduce resistance to change, and
heal dysfunctions within the organization.

Fortitude. An entrepreneur requires fortitude to keep a business strong and eventually

bring it to harvest. Fortitude, which stems from persistence, realism, and consistency,
strengthens the entrepreneur against scattered thinking and giving up

Most Valuable Possession

An entrepreneur’s most valuable possession in the business world is not money or products
or facilities. It’s his or her reputation. If you lie, cheat, or steal, the marketplace usually
learns about it, and you lose any credibility that you may have had.

The Importance of Goals

Entrepreneurial vision imagines a future, whereas goals focus on a desired outcome.
Although vision is key to creating the future that you want for yourself and your business,
goals are important to help you realize the steps needed to make that vision a reality.
Read through your definitions of success and your vision statement. Now create a list of
possible actions that will help you achieve success and accomplish your vision. Review your
list and categorize the words and actions in terms of relevance and time frames.

SMART goals are well-structured and defined goals that are specific, measurable,
achievable, realistic, and timely (Figure 1.9).
 Specific: Your goals should be precise rather than overly broad.
 Measurable: You should be able to test in some quantifiable manner whether a
goal has been met, meaning that there needs to be some method to determine if the
goal has been met or not.
 Achievable: The goal must be attainable; it cannot be so lofty that it cannot be
accomplished. On the other hand, the goal should not be so easy that it can be
accomplished quickly or with little effort.
 Relevant: The goal should be well suited for what you want to accomplish; this
means that the goal should be relevant to the outcome needed.
 Timely: Each goal needs to have a defined deadline, the time when the goal must be
accomplished. What time frame do you have for completing your goals? How does
this timeline fit into your overall plan?

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Creating SMART goals can help you realize your vision. (attribution: Copyright Rice
University, OpenStax, under CC BY 4.0 license)

For example, if your personal definition of success and your vision for your future include
financial independence—with, say, a vacation home in the mountains—what goals can you
define today that will lead to this outcome? You would include financial goals tracked either
monthly or yearly to save a set amount of money based on your projection of how much
money it will take to own these two vacation homes. You would also set goals about finding
the right locations. This process is also necessary to support the success of your business
venture. Setting goals is a powerful approach that leads us to the future we want for our
lives.

Here is a fictional example of an entrepreneur’s goals, which we can test against the SMART
criteria to see if they are feasible. Soraya runs a small tutoring business in Dallas, Texas. Her
target market is high school students. Soraya is currently the only employee in her sole
proprietorship, but she hopes to hire more employees soon. She is excited about her
business, and so far, she has done well in the four years that she has been operating it. On
the advice of a friend in business school, Soraya has defined three business goals for the
next year. They are:

1. Increase sales by 50 percent.

2. Open a new location.
3. Hire two employees.

In reviewing these goals using the SMART criteria, it is evident that goals one and three
are specific because they are quantitative, but goal two is not. All three goals can
be measured. With Soraya as the only employee, it is unlikely that she can achieve goals one
and two, but goal three is achievable. And hiring more staff would increase the likelihood of
achieving additional goals. All three goals are relevant to growing the business. And each
goal could use more detail in terms of being timely. That is, in order to increase sales by 50
percent in the upcoming year, Soraya should have additional monthly or quarterly sales
goals to meet her annual goal. Likewise, the opening of a new location requires more time-
bound details, such as leasing or purchasing the location, and determining the business
model for this location. Finally, hiring additional employees should have a time component
as well, such as a timeline for recruiting, interviewing, selection, hiring, and training.
Therefore, Soraya’s goals are appropriate for her small tutoring business, but they need
refining so that they meet the SMART criteria. Soraya is more likely to achieve SMART goals,
and they are more likely to lead to desired business outcomes.

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Assessing Learning

Name: ________________________________________ Date:________________

Course/Year/Section: _____________________ Score: ______________

Activity

Direction: Read each statement below. Identify what is being described in each
statement.

_____1.This occurs even when the person has no idea how (or if) what they desire to
accomplish or create will become a reality. –
____2. The picture you have for what the venture will become in the future: what it
will grow into. –
____3. A formal declaration about what the venture will do, what value it will provide
to the end customer, and how it will accomplish this action. -
____4.considers what you want your venture to become, what this venture will look
like, what the driving forces are, and what values and culture should surround it. -
____5. As part of the process of tapping into creative ideas, you can
apply ___________ by generating as many ideas as possible, even when those ideas do
not seem logical.
____6.Someone who takes on the daily management as the owner of the venture,
accepting, and perhaps enjoying, the daily risks and rewards of managing and
building the venture. –
____7.Imagines a future, whereas goals focus on a desired outcome. Although vision
is key to creating the future that you want for yourself and your business, goals are
important to help you realize the steps needed to make that vision a reality. –
____8. Your goals should be precise rather than overly broad. –
____9. You should be able to test in some quantifiable manner whether a goal has
been met, meaning that there needs to be some method to determine if the goal has
been met or not. –
____10. The goal should be well suited for what you want to accomplish; this means
that the goal should be relevant to the outcome needed.

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Assessing Learning

Name: ________________________________________ Date:________________

Course/Year/Section: _____________________ Score: ______________

Activity

Answer the following:

1. What is entrepreneurial vision?

2. Give an exampleof SMART goals of your chosen company or business?

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References:

What is the Importance of Images in Business? (chron.com)

https://smallbusiness.chron.com/importance-images-business-75964.html
Vision Statements: Approaches, Techniques and Tips for Building a New Organizational Vision
(beingfirst.com)
Chapter 8. Developing a Strategic Plan | Section 2. Proclaiming Your Dream: Developing Vision
and Mission Statements | Main Section | Community Tool Box (ku.edu)
How to Develop Strategy Mission, Vision & Values | OnStrategy (onstrategyhq.com)

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 Unit V
Leadership vs. Entrepreneurship

Overview

This unit discusses the difference of leadership and entrepreneurship, and

how they are related. This unit helps readers identify the significance of leadership in
entrepreneurship

Learning Objectives

At the end of this unit, I am able to:

1. understand the difference between leadership and entrepreneurship; and
2. discuss the difference types of leadership

Setting Up

Name : ____________________________________ Date: _______________

Course/Year/Section: ____________________

What are your thoughts on the following statements?

1. ‘Leadership is not a position or a title, it is action and example’ — Unknown

___________________________________________________________________________________________________
___________________________________________________________________________________________________
___________________________________________________________________________________________________
______________________________.

2. The leadership expert Peter DeLisle is more specific: “Leadership is the ability to
influence other people, with or without authority.”

___________________________________________________________________________________________________
___________________________________________________________________________________________________
___________________________________________________________________________________________________
______________________________.

3. Initiating any new business requires dedication, investment of time, energy and
resources; hence, it requires one’s full concentration. Therefore, one must have a clear
idea for solving a major problem for the betterment of everyone; and that is
entrepreneurship as defined by Steve Jobs.

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___________________________________________________________________________________________________
___________________________________________________________________________________________________
___________________________________________________________________________________________________
______________________________.
Lesson Proper

Difference between Entrepreneurship and Leadership and its meanings

Sometimes, an entrepreneur and a leader, or say, entrepreneurship and leadership are
considered as synonym, i.e. meaning the same thing. But, these two terms mean quite
different meanings.Entrepreneurship means a set of attributes that an entrepreneur
possesses and practices in starting his /her enterprises. But, leadership is the process of
influencing people and providing an environment for them to achieve the organizational
objectives. Thus, leadership is quite different from entrepreneurship. Entrepreneurship can
be included in leadership, but not leadership in entrepreneurship.

Leadership has also its implications for entrepreneurial behaviour. People with leadership
qualities, for example, influencing ability, are found more prone to become entrepreneurs
and perform entrepreneurial functions more effectively.

Research studies (Burns 1978) report that entrepreneurs blended with leadership
attributes often emerge as ‘transformational entrepreneurs’ who replace old and routine
things by altogether new sets and standards of work performance.
They work for change rather stability. This is because leadership involves a drive, i.e. (high)
need for achievement, the most important antecedent to entrepreneurship. This drive
represents the inner motivations that entrepreneurs with leadership qualities possess to
pursue their goals and encourage others to willingly and enthusiastically move forward to
achieve the set goals.
The relevant leadership qualities or competencies influencing entrepreneurial behaviour
are inner drive, integrity, self-confidence, intelligence, knowledge in the concern business,
and emotional intelligence. One way to distinguish entrepreneurship from leadership can be
in terms of their task demands and personal dispositions.

Table 1. Difference of Leadership and Entrepreneurship

Bases of Difference Entrepreneurship Leadership
Task Demands    

Major Goal Profit Change

Time Frame Short and Long-run Future
Arena Enterprise and Markets Social Systems
Personal Disposition    

Resourcefulness Medium Medium

Achievement Orientation Medium High
Visioning Opportunity-Seeking High Low

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Innovativeness High Medium

Additional differences of Entrepreneur and Leader

1. Entrepreneurs grow ideas, Leaders grow people

Inventors have amazing minds. They are able to see the future, infer trends and create
markets where none existed previously. These individuals can launch a company from an
idea and have the stamina to keep going no matter what. Leaders are the people who
understand that although one mind might be brilliant, a team will achieve so much more if
everyone believes in the same vision.

2. Entrepreneurs drive toward the objective, Leaders take people along with them
Entrepreneurs are laser focused on “taking the hill.” Many do this at the expense of others
who can’t keep up or don’t agree with the path. Leaders understand that they need a team –
no one person can do it alone. Leaders seek out advice, support and engagement from
friends, advisors, colleagues, partners and employees to “take the hill.”

3. Entrepreneurs micromanage, Leaders delegate

Entrepreneurs are tirelessly committed to their vision. Often they believe that no one can
possibly do a job as well as they can. They may lack the ability to trust others and so they
embark on the impossible task of being hands on in EVERY component of their business.
Leaders are mature professionals who understand that scaling a company is impossible if
the founder has to be involved with every component. The accomplished Leader knows how
to tap into the talents of others, and include them as integral parts of the business. Trusting
them, coaching and mentoring along the way in order for all to achieve success.

4. Entrepreneurs command, Leaders coach

In their effort to stay focused on building their dream, Entrepreneurs tend to undervalue
empathy and sensitivity. They will bark orders rather than make requests, issue commands
and get defensive when someone questions them. Leaders take a coaching posture with
their teams. Leaders understand that their success is dependent on their team members
being successful. The practiced Leader will take an enormous amount of time on the front
end with individuals in order to make sure that they have the tools, knowledge and
confidence to be accomplished in their role.
I believe that you can be an Entrepreneur without strong Leadership competency. 
However, your success will be finite – I know some brilliant company founders who have
“been driven out of town” because of their unwillingness to embrace Leadership skills.

Leadership Styles and Frameworks

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A leadership style refers to a leader's characteristic behaviors when directing, motivating,
guiding, and managing groups of people. Great leaders can inspire political movements and
social change. They can also motivate others to perform, create, and innovate.
As you start to consider some of the people who you think of as great leaders, you can
immediately see that there are often vast differences in how each person leads. Fortunately,
researchers have developed different theories and frameworks that allow us to better
identify and understand these different leadership styles.
Lewin's Leadership Styles
In 1939, a group of researchers led by psychologist Kurt Lewin set out to identify different
styles of leadership.1 While further research has identified more distinct types of leadership,
this early study was very influential and established three major leadership styles that have
provided a springboard for more defined leadership theories.

In Lewin's study, schoolchildren were assigned to one of three groups with an

authoritarian, democratic, or laissez-faire leader. The children were then led in an arts and
crafts project while researchers observed the behavior of children in response to the
different styles of leadership. The researchers found that democratic leadership tended to
be the most effective at inspiring followers to perform well.

Authoritarian Leadership (Autocratic)

Authoritarian leaders, also known as autocratic leaders, provide clear expectations for what
needs to be done, when it should be done, and how it should be done. This style of
leadership is strongly focused on both command by the leader and control of the followers.
There is also a clear division between the leader and the members. Authoritarian leaders
make decisions independently, with little or no input from the rest of the group.

Researchers found that decision-making was less creative under authoritarian

leadership.1Lewin also concluded that it is harder to move from an authoritarian style to a
democratic style than vice versa. Abuse of this method is usually viewed as controlling,
bossy, and dictatorial.

Authoritarian leadership is best applied to situations where there is little time for group
decision-making or where the leader is the most knowledgeable member of the group. The
autocratic approach can be a good one when the situation calls for rapid decisions and
decisive actions. However, it tends to create dysfunctional and even hostile environments,
often pitting followers against the domineering leader.

Participative Leadership (Democratic)

Lewin’s study found that participative leadership, also known as democratic leadership, is
typically the most effective leadership style. 1 Democratic leaders offer guidance to group
members, but they also participate in the group and allow input from other group members.
In Lewin’s study, children in this group were less productive than the members of the
authoritarian group, but their contributions were of a higher quality. 2

Participative leaders encourage group members to participate, but retain the final say in the
decision-making process. Group members feel engaged in the process and are more

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motivated and creative. Democratic leaders tend to make followers feel like they are an
important part of the team, which helps foster commitment to the goals of the group.

Delegative Leadership (Laissez-Faire)

Lewin found that children under delegative leadership, also known as laissez-faire
leadership, were the least productive of all three groups. 1 The children in this group also
made more demands on the leader, showed little cooperation, and were unable to work
independently.

Delegative leaders offer little or no guidance to group members and leave the decision-
making up to group members. While this style can be useful in situations involving highly
qualified experts, it often leads to poorly defined roles and a lack of motivation.

Lewin noted that laissez-faire leadership tended to result in groups that lacked direction
and members who blamed each other for mistakes, refused to accept personal
responsibility, made less progress, and produced less work.

Observations AboutLewin's Leadership Styles

In their book, "The Bass Handbook of Leadership: Theory, Research, and Managerial

Applications," Bass and Bass note that authoritarian leadership is often presented solely in
negative, often disapproving, terms.2 Authoritarian leaders are often described as
controlling and close-minded, yet this overlooks the potential positives of stressing rules,
expecting obedience, and taking responsibility.

While authoritarian leadership certainly is not the best choice for every situation, it can be
effective and beneficial in cases where followers need a great deal of direction and where
rules and standards must be followed to the letter. Another often overlooked benefit of the
authoritarian style is the ability to maintain a sense of order.

Bass and Bass note that democratic leadership tends to be centered on the followers and is
an effective approach when trying to maintain relationships with others. 2 People who work
under such leaders tend to get along well, support one another, and consult other members
of the group when making decisions.

Additional Leadership Styles and Models

In addition to the three styles identified by Lewin and his colleagues, researchers have
described numerous other characteristic patterns of leadership. A few of the best-known
include:

Transformational Leadership
Transformational leadership is often identified as the single most effective style. This style
was first described during the late 1970s and later expanded upon by researcher Bernard
M. Bass. Transformational leaders are able to motivate and inspire followers and to direct
positive changes in groups.

58
These leaders tend to be emotionally intelligent, energetic, and passionate. They are not
only committed to helping the organization achieve its goals, but also to helping group
members fulfill their potential.
Research shows that this style of leadership results in higher performance and more
improved group satisfaction than other leadership styles. 3 One study also found that
transformational leadership led to improved well-being among group members.
Transactional Leadership

The transactional leadership style views the leader-follower relationship as a transaction.

By accepting a position as a member of the group, the individual has agreed to obey the
leader. In most situations, this involves the employer-employee relationship, and the
transaction focuses on the follower completing required tasks in exchange for monetary
compensation.

One of the main advantages of this leadership style is that it creates clearly defined roles. 4
People know what they are required to do and what they will be receiving in exchange. This
style allows leaders to offer a great deal of supervision and direction, if needed.

Group members may also be motivated to perform well to receive rewards. One of the
biggest downsides is that the transactional style tends to stifle creativity and out-of-the-box
thinking.

Situational Leadership
Situational theories of leadership stress the significant influence of the environment and the
situation on leadership. Hersey and Blanchard's leadership styles is one of the best-known
situational theories. First published in 1969, this model describes four primary styles of
leadership, including:5

1. Telling: Telling people what to do

2. Selling: Convincing followers to buy into their ideas and messages
3. Participating: Allowing group members to take a more active role in the decision-
making process
4. Delegating: Taking a hands-off approach to leadership and allowing group
members to make the majority of decisions

Later, Blanchard expanded upon the original Hersey and Blanchard model to emphasize
how the developmental and skill level of learners influences the style that should be used by
leaders. Blanchard's SLII leadership styles model also described four different leading
styles:6

1. Directing: Giving orders and expecting obedience, but offering little guidance and
assistance
2. Coaching: Giving lots of orders, but also lots of support
3. Supporting: Offering plenty of help, but very little direction
4. Delegating: Offering little direction or support

59
What Leaders Need Now Is Innovation Leadership

They need it for themselves as they learn to operate in challenging, unpredictable

circumstances. They also need to create a climate for innovation within organizations.
Innovative systems, tools, and thinking are essential for organizational health and future
viability.
We can’t give leaders a new crystal ball. But by pairing the creative leadership expertise of
the Center for Creative Leadership (CCL®) and the power of design thinking from
Continuum, we show how innovation leadership can help you and your organization today
and in the uncertain times to come.

Why Innovation Matters

“I used to be a great strategic planner. Now, I’m not sure of the right way to go. There has
got to be something else, another way to look at our industry and our future.”
“If we come out of the recession with exactly the same stuff we had before, we’re dead in the
water.” “We know innovation is part of the answer. But how do we do it?”
“Obviously, we can’t keep doing the same things over and over again. Our internal systems
aren’t efficient and our best products are old news.”

CEOs and leaders throughout organizations know they need to change the way they work.
As they seek to drive results at a tactical level, leaders are looking for new rules of the road
to give them a competitive edge and fuel new industries, markets, products, and services.

Underlying the pressure to adapt— as individuals and organizations—is the need to

innovate. But how? When faced with confusion or a problem, our instinct is to repair it with
order. We examine and analyze the situation, looking for logic, until we can say: “Aha, I
know this. Now I know what to do.” Unfortunately, the rapid analysis and rational decision-
making that most managers use to run their organizations has serious limitations.

As problems and circumstances become more complex, they don’t fit previous patterns. We
don’t recognize the situation. We can’t rapidly or automatically know what to do. What
worked before doesn’t work today. To make effective sense of unfamiliar situations and
complex challenges, we must have a grasp of the whole of the situation, including its
variables, unknowns, and mysterious forces. This requires skills beyond everyday analysis.
It requires innovation leadership.

Innovation Leadership Has Two Components

1. An innovative approach to leadership. This means to bring new thinking and different
actions to how you lead, manage, and go about your work. How can you think differently
about your role and the challenges you and your organization face? What can you do to
break open entrenched, intractable problems? How can you be agile and quick in the
absence of information or predictability?

60
2. Leadership for innovation. Leaders must learn how to create an organizational climate
where others apply innovative thinking to solve problems and develop new products and
services. It is about growing a culture of innovation, not just hiring a few creative outliers.
How can you help others to think differently and work in new ways to face challenges?
What can be done to innovate when all resources are stressed and constrained? How can
you stay alive and stay ahead of the competition?

This two-tiered approach generates the kind of innovation that can produce the next new
product or design, but it goes well beyond. In our work, Continuum has applied innovation
leadership to economic development in Central America and water and sanitation projects
in South Africa. Innovation leadership at CCL has spurred the development of programs,
services, and tools, including an Innovation Leadership workshop and initiatives to build
leadership capacity among communities, governments, and non-government organizations
(NGOs) in Africa and India. Our corporate and educational clients, too, are connecting the
power of innovation to multiple and varied concerns such as team effectiveness, decision
making, managing multiple stakeholders, adapting to change, balancing regional and
centralized functions, entering new markets, and product R&D.

61
Assessing Learning

Name: ________________________________________ Date:________________

Course/Year/Section: _____________________ Score: ______________

Activity

Direction:Based on what you have learned from the module, differentiate

Entrepreneurship vs. Leadership by completing the table.

Difference of Leadership and Entrepreneurship

Bases of Difference Entrepreneurship Leadership
Task Demands    
Major Goal 1. 2.
Time Frame 3. 4.
Arena 5. 6.
Personal Disposition
Resourcefulness 7. 8.
Achievement Orientation 9. 10.
Visioning Opportunity- 11. 12.
Seeking
Innovativeness 13. 14.

62
Assessing Learning

Name: ________________________________________ Date:________________

Course/Year/Section: _____________________ Score: ______________

Activity

Direction: Name famous leaders or entrepreneurs with their leadership style.Look for their
leadership stories. Write it on the space provided.

1. Authoritarian Leadership (Autocratic)

2. Participative Leadership (Democratic)

3. Delegative Leadership (Laissez-Faire)

63
References:

Entrepreneurship and Leadership | IE Insights

https://www.ie.edu/insights/articles/entrepreneurship-and-leadership/
Difference between Entrepreneurship and Leadership – Explained! (yourarticlelibrary.com)
Entrepreneurship and Leadership | IE Insights
What is the difference between leader and entrepreneur? - Quora
https://essay.utwente.nl/66030/1/Zijlstra_BA_MB.pdf
Harnessing the Power of Positive Thinking - business.com

64
 Unit VI
Entrepreneurial Leadership Process: Corporate Entrepreneurship

Overview
This unit discusses the entrepreneurial leadership process and corporate
entrepreneurship.

Learning Objectives

At the end of this unit, I am able to:

1. understand reasons for corporate entrepreneurship; and

2. discuss the four model of corporate entrepreneurship

Setting Up

Name : ____________________________________ Date: _______________

Course/Year/Section: ____________________

Answer the following questions:

1. What is corporate entrepreneurship?
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________

2. What is an example of corporate entrepreneurship?

_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________

3. What are the characteristics of corporate entrepreneurship?

_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________

4. Why is corporate entrepreneurship important?

_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________

65
Lesson Proper

10 Reasons for Corporate Entrepreneurship 

A question that many executives ask me; “Is corporate entrepreneurship just the latest
management fad.”  Fad or no fad the real question is why now!

Read 10 reasons why corporate entrepreneurship is needed now.  Then let me know if you
think corporate entrepreneurship (Intrapreneurship) is a management fad or here to stay.

1)  Inadequate Growth:  The current reality is that most organizations have spent the last
decade investing in existing or mature products that are not providing adequate growth.

2)  Failure Rate:  The failure rate for new business initiatives remains high for new
products and services, more than ninety percent for transformational efforts.

3)  Lack of Capabilities:  A majority of CEOs do not feel like they have the skills or
capabilities inside their organization to achieve their growth agenda, they are probably
right.

4)  Few Role Models:  Only four percent of executives in large organizations are
entrepreneurs or entrepreneurial, most executives have achieved their success by
managing the core business not building new ones.

5)  Major Barriers:  After a decade of cost cutting and streamlining operations,

organizations have created rigid and inflexible systems that have created roadblocks and
barriers to growth.

6)  Inability to Change:  Risk adverse cultures, resistance to change and fear of the
unknown are impeding an organizations ability to respond to a rapidly changing world.

7)  Reliance on the Past:  Increasing uncertainty, complexity and ambiguity are putting
pressure on organizations to rely on practices that worked well for them in the past, but
may not now.

8)  Poor Execution:  Three out of five organizations say they are weak when it comes to
execution and they see corporate entrepreneurship as a way to close the gap between idea
generation and execution.

9)  Business Benefits:  Corporate entrepreneurship is linked to higher levels of

productivity, engagement, growth, innovation and financial returns. It is also linked to
intangible outcomes like knowledge, skill development and job satisfaction.

10)  Accelerate Growth:  Sixty five percent of the top one hundred innovative companies
are instituting corporate entrepreneurship as a way to increase their ability to accelerate
new business growth.

Is corporate entrepreneurship the latest management fad or a business imperative? You

decide!

66
The four models of corporate entrepreneurship
Opportunist, enabler, advocate and producer are the four models of corporate
entrepreneurship that Robert C. Wolcott and Michael J. Lippitz discuss in ‘Grow from
Within’.
Mapping the models on two dimensions, viz. organisational ownership (ranging from
diffused to focused) and resource authority (ad hoc to dedicated), the authors find that all
companies begin as opportunists.

The Opportunist 
However, the opportunist model works well only in trusting corporate cultures that are
open to experimentation and that have diverse social networks behind the official
hierarchy. “There need to be multiple executives who can say yes to a new business concept.
Without that type of environment, good ideas can easily fall through organisation cracks or
receive insufficient funding to prove feasible”, say Wolcott and Lippitz.
 
The Enabler
In contrast to the opportunist model of diffused ownership and ad hoc resource allocation,
the enabler model has dedicated resources. “Early stages of new business conception are
explicitly supported, encouraged, and often strategically channeled, with a promise of
serious management attention to those concepts that look promising.” But the enabler
model is not only about allocating capital for corporate entrepreneurship. It is also
about personal development and executive engagement. 
 
The Advocate 
In the third model, the advocate (with focused ownership and ad hoc resource allocation), a
company assigns organisational ownership for driving the creation of new businesses to a
designated corporate-level group, but it intentionally provides the group with only a
modest budget. Advocate organisations act as evangelists and innovation experts,
facilitating corporate entrepreneurship in conjunction with business units, which must
demonstrate their commitment to new business development by paying most of the bills, as
the authors note. 
 
The Producer
The fourth model, the producer, with focused ownership and dedicated resources, aims
to protect emerging projects from turf battles, to encourage cross-unit collaboration,
to build potentially disruptive businesses, and to create pathways for executives to pursue
careers outside their business units, Wolcott and Lippitz explain.
 
Thanks for taking the time to read our blog post on the four models of corporate
entrepreneurship. If you are thinking about studying in Germany, PFH offers a Master’s
Degree in General Management. While if you are interested in being even more
international, we also offer dual degree programmes, where you study part of your time in
New York, London, Bordeaux or even Australia and receive two degrees.

67
Corporate Entrepreneurship

Introduction
According to Bull and Willard (1993) more than two centuries of studying
entrepreneurship have provided many definitions of the word ‘entrepreneur’. In academic
literature scholars have also provided many definitions of corporate entrepreneurship. In
order to understand the concept of entrepreneurship in an established firm it is necessary
to be acquainted with entrepreneurship in general. Therefore, the first section deals with
the concept of entrepreneurship as a new start-up firm followed by an elaboration on the
concept of corporate entrepreneurship in section 2.3. The last section provides a summary
of the concerning chapter and the answer to the research question; what is corporate
entrepreneurship?

Entrepreneurship
Defining entrepreneurship is somewhat difficult since many scholars have tried to explain
what entrepreneurship is, it seems that many people are holding different views concerning
the definition of an entrepreneur and defining entrepreneurship in particular. Schumpeter’s
definition is accepted by many researchers, policy-makers and teachers (Bull & Willard,
1993). Schumpeter (as cited in Bull & Willard, 1993) defines an entrepreneur as ‘someone
who carries out new combinations, causing discontinuity’ (p.186). Alongside the definition
of an entrepreneur, Morris (as cited in Morris, Kuratko, &Covin, 2007) identifies seven of
the most widespread perspectives on entrepreneurship from years of academic research;
creation of wealth (delivering product/service in exchange for profit), creation of value
(creating value for customers by exploitation), creation of change, creation of employment
(employing, managing and developing the labour force), creation of enterprise (founding of
new business venture), creation of innovation, and creation of growth (growth in sales,
income, assets and employment).

Corporate Entrepreneurship
In the ’80s of last century, entrepreneurship within an established organization emerged as
being the center of interest in organizations aiming at enhancing product innovation, risk-
taking and pro-activeness to changes in the external environment of the organization
(Zahra, 1991). However, only recently academics have provided empirical evidence that
corporate entrepreneurship leads to superior firm performance (Covin& Miles, 1999). So
unlike ‘entrepreneurship’, corporate entrepreneurship is relatively new in academic
research. 11 From the definition of entrepreneurship, as a new start-up firm, it is evident
that entrepreneurship can occur in different organizational contexts and in organizations of
all sizes and types. Therefore, it is not limited to small businesses or new businesses. Many
definitions of corporate entrepreneurship have been given by scholars. Lumpkin and Dess
(1996) have given five dimensions of entrepreneurial orientation within an organization,
namely - innovativeness, risk taking, autonomy, competitive aggressiveness and pro-
activeness. Wolcott and Lippitz (2007) define corporate entrepreneurship as ‘the process
by which teams within an established company conceive, foster, launch and manage a new

68
business that is distinct from the parent company but leverages the parent’s assets, market
position, capabilities or other resources’ (p. 75). 2.4 Summary Despite the many definitions
given by scholars, there are seven most common perspectives on entrepreneurship, namely
- creation of wealth, creation of value, creation of change, creation of employment, creation
of enterprise, creation of innovation and creation of growth (Morris, as cited in Morris et al.,
2007). Schumpeter (as cited in Bull & Willard, 1993) identifies an entrepreneur as someone
who acts upon new combinations which will eventually cause discontinuity. His definition is
accepted by many scholars, policy-makers and teachers (Bull & Willard, 1993). Alongside
the definition of an entrepreneur and entrepreneurship, the concept of corporate
entrepreneurship was explained. Corporate entrepreneurship was defined as people within
an organization being innovative, risk-taking, autonomous, competitive, aggressive and pro-
active (Lumpkin &Dess, 1996). It also entails starting, fostering, launching and managing
new businesses for the company (Wolcott &Lippitz, 2007).

Forms of Corporate Entrepreneurship

In academic literature scholars differentiate between various forms of entrepreneurship

within an established organization. The strategy literature makes a distinction between
these general forms; corporate venturing, activities associated with the transformation or
renewal of existing organizations and the third one is innovation based on the concept given
by Schumpeter (Stopford& Baden-Fuller, 1994).

Corporate Venturing - entails creating new businesses within a corporation, either by

creating and owning the businesses (internal corporate venturing - they typically operate
within the corporate structure), creating new businesses together with another external
partner (cooperative corporate venturing – they exist as external entities that operate
outside the organizational boundaries of the partners), or by creating new businesses
outside the corporation and then invested in or acquired by the corporation (external
corporate venturing – these are typically very young ventures or early growth- stage firms)
(Morris et al, 2007). Corporate venturing are carried out by small teams (Covin& Miles,
1999).

Organizational renewal - is a more expansive way of organizations that are changing the
way resources are specified and distributed in order to achieve better and sustainable
overall economic performance (Stopford& Baden-Fuller, 1994). Hence, organizational
renewal entails doing business in a completely different way than before.

Innovation- according to Stopford and Baden-Fuller (1994), means behavior transforming

the company and the competitive environment or industry into something completely
different than what it used to be. It is all about changing the rules of competition for the
organization’s industry. It often occurs in new industries and usually represents
innovations that are associated with new combinations of resources. These different forms
are not mutually exclusive; they may co-exist as entrepreneurial activities within a single

69
organization (Covin& Miles, 1999). They should also be considered as sequences of stages.
In stage one, corporate venturing is prevalent, renewal follows and this eventually will
result in innovation (Stopford&Baden-Fuller, 1994). Figure 3.1 illustrates the general forms
of corporate entrepreneurship.

Five Forms of Corporate Entrepreneurship

Unlike the forms corporate venturing and organizational renewal, the form innovation
permits the whole organization, and not just a few individuals, to act entrepreneurial
(Covin& Miles, 1999). According to Covin and Miles (1999) innovation, also known as
entrepreneurial orientation, knows four different forms. As stated in figure 3,2 these four
forms of corporate entrepreneurship are; organizational rejuvenation, strategic renewal,
sustained regeneration and domain redefinition. In addition, Morris, Kuratko and Covin
(2007) add the fifth form to entrepreneurial orientation; business model reconstruction.
These five forms are manifested by the entire firm rather than by a single individual or
team. They are the process of identifying and exploiting new opportunities and in the same
time creating and sustaining competitive advantage via opportunity seeking and advantage
seeking behaviors (Ketchen, Ireland, & Snow, 2007; Kuratko&Audretsch, 2009). This is also
said to be wealth creation (Ireland, Hitt and Sirmon, 2003). Opportunity seeking behavior is
about identifying and exploiting (new) opportunities and new sources of value for the firms
(Ireland et al., 2003; Kuratko&Audretsch, 2009). Advantage seeking behavior identifies
ways in order to create a competitive advantage and the efforts to transform it into a
sustainable competitive advantage (Ireland et al., 2003). Companies enjoy competitive
advantage when they implement a strategy that creates value and is not being implemented
by another (potential) competitor; this strategy is said to be sustained if the other firms are
not in the position of imitating the benefits of this strategy (Barney, 1991).

70
Organizational rejuvenation - is the process whereby the organization tries to ‘sustain or
improve its competitive standing by altering its internal processes, structures, and/or
capabilities,’ where the aim is to improve the implementation of the firm’s strategy (Covin&
Miles, 1999, p.52). According to Morris et al., (2007) organizational rejuvenation can entail
redesigning the organization in a fundamental way, a single innovation that has a major
impact on the firm, or multiple smaller innovations that collectively ‘contribute to
significantly increased organizational efficiency or effectiveness at strategy implementation’
(p. 89.). Meaning that the effort in organizational rejuvenation has to have a major impact
on the way the firm’s strategy is implemented through internal processes, structures,
and/or capabilities. When organizations engage in organizational entrepreneurship they
introduce innovations that change major aspects of how the operation is carried out, create
value for the customers, and sustain or improve the way the organization implements its
strategy (Covin& Miles, 1999).

Strategic renewal - is a form of corporate entrepreneurship in which the firm ‘seeks to

redefine its relationship with its markets or industry competitors by fundamentally altering
how it competes,’ with the focus on the firm’s strategy (Covin& Miles, 1999, p. 52). Morris et
al., (2007) argue that not all firms are pursuing strategic renewal when they opt for a new
strategy, it is considered strategic renewal when they ‘represent fundamental repositioning
efforts by the firm within its competitive space,’ or new ventures that are based on ‘unique
value propositions that deviate from accepted industry strategic recipes’ (p.89-90).

Sustained regeneration - seen as the most recognized and common form, is the process
where organizations ‘regularly and continuously introduce new products and services or
enter new markets,’ the firm is in constant pursuit of entrepreneurial opportunities (Covin&
Miles, 1999, p.51). Unlike the other forms, sustained regeneration cannot be presented by a

71
single type of event; it is an ongoing process of introducing new products and services or
entering a new market. Therefore, it will often result in incremental innovation and
occasionally resulting in new business creation (Morris et al., 2007). Covin and Miles (1999)
characterize firms engaging in sustained regeneration as an innovative organization
consisting of cultures, systems, structures and competencies which support innovation.
They conclude that these firms often happen to be learning organizations

Domain redefinition - refers to the ‘entrepreneurial phenomenon whereby the

organization proactively creates a new product-market arena that others have not
recognized or actively sought to exploit’ (Covin& Miles, 1999, p.54). Firms redefining its
domain are proactive and they engage in strong entrepreneurial orientation (Dess et al.,
2003). Through domain redefinition firms go into a market where there are (temporarily)
no competitors, also called the ‘Blue Oceans’ by Kim and Mauborgne (2004). By this first
mover status firms try to achieve a sustainable competitive advantage when competitors
follow. Kim and Mauborgne (2004) present blue oceans as industries that do not exist yet –
the unknown market space that is not yet discovered by and touched upon by the
competitor, where the demand is created by the firm rather than competed for. Out of the
five forms, domain redefinition is the only form in which it necessarily results in a new
business creation (Covin& Miles, 1999).

Business model reconstruction - is added by Morris et al., (2007) next to the four forms
given by Covin and Miles (1999). Business model reconstruction entails ‘designing or
redesigning the core business model(s) in order to improve operational efficiencies or
otherwise differentiate itself from industry competition in ways valued by the market’
(Morris et al., 2007, p.92). Business model, according to Margretta (2002), are the ‘stories
that explain how enterprises work (p. 87). Miles, Munila, and Darroch (2009) argue that in
16 order to create competitive advantage via business model reconstruction the
organization has to redefine the value proposition of the customer-firm relation.

72
Assessing Learning

Name: ________________________________________ Date:________________

Course/Year/Section: _____________________ Score: ______________

Activity

Direction: Read each statement below. Identify what is being described in each
statement.

_____1. The failure rate for new business initiatives remains high for new products
and services, more than ninety percent for transformational efforts. -

____2.A majority of CEOs do not feel like they have the skills or capabilities inside
their organization to achieve their growth agenda, they are probably right. –

____3. Increasing uncertainty, complexity and ambiguity are putting pressure on

organizations to rely on practices that worked well for them in the past, but may not
now. –

____4. Three out of five organizations say they are weak when it comes to execution
and they see corporate entrepreneurship as a way to close the gap between idea
generation and execution. –

____5. Risk adverse cultures, resistance to change and fear of the unknown are
impeding an organizations ability to respond to a rapidly changing world. –

____6. Sixty five percent of the top one hundred innovative companies are instituting
corporate entrepreneurship as a way to increase their ability to accelerate new
business growth. –

____7. It works well only in trusting corporate cultures that are open to

experimentation and that have diverse social networks behind the official hierarchy.

____8. It focused ownership and dedicated resources, aims to protect emerging

projects from turf battles, to encourage cross-unit collaboration, to build potentially
disruptive businesses, and to create pathways for executives to pursue careers
outside their business units.

____9. It entails creating new businesses within a corporation, either by creating and
owning the businesses.

____10. Is a more expansive way of organizations that are changing the way
resources are specified and distributed in order to achieve better and sustainable
overall economic performance.

73
References:

[1]
https://www.goldstonepartners.com/entrepreneurship-vs-leadership/
[2]
https://www.yourarticlelibrary.com/difference/difference-between-
entrepreneurship-and-leadership-explained/40664
[3]
https://www.verywellmind.com/leadership-styles-2795312#:~:text=Leadership
%20styles%20are%20classifications%20of,delegative%20(laissez%2Dfaire).
[4]
https://corporate-entrepreneurs.com/2013/02/22/10-reasons-for-corporate-
entrepreneurship-fad-or-no-fad/#:~:text=9)%20Business%20Benefits%3A
%20Corporate%20entrepreneurship,skill%20development%20and%20job
%20satisfaction.
[5]
https://www.pfh-university.com/blog/the-four-models-of-corporate-
entrepreneurship.html

74