Companies that want to keep pace with the constantly changing and increasing demands of the market have to constantly change and develop themselves. The directors of the Steinbeis Consulting Center for Entrepreneurial Excellence have started to question what a typical business development process should look like in order to achieve success, and why failure can happen even despite careful preparation.
Two factors shape the way companies develop. One factor relates to external influences on a company like, for example, threats caused by changes in the market and rivalry among competitors. The other is internal: influences on the company itself, such as the founder, the management, and the company employees. This begs the question: Why do development projects sometimes fail or come to nothing, despite the fact that results are targeted, change processes are defined, and change management departments have been put in place? Many businesspeople shy away from investing resources again once they’ve had to terminate projects, see stagnant (change) processes, and watch precious resources like money, time, and nerves wasted on fruitless endeavors.
This is one reason why the term “entrepreneur” (the French word for a business founder) is now often used in discussions in Germany about company development. The phenomenon of using a new term when old vocabulary seems to have served its purpose and can’t be resuscitated is very well known. But why does it seem that today of all times a new concept or description is necessary? Classic businesspeople shape their company by working in and at the business. They’re the source of all strategic thinking and action. In many cases, however, they’re just a business administrator in the sense of a manager – someone who still works at the company and is often his own best expert. This contrasts to real entrepreneurial spirit, the driving force of innovation that is increasingly overshadowed by product requirements, KPIs, and far too strict specifications. Company development based on re-inventing processes is reaching its limits. So it’s precisely this space that these new entrepreneurs hope to fill – and should.
A company can only develop in the same measure as the entrepreneur is willing to develop himself. It is crucial that he sets the right targets for himself – both professionally and privately. Realizing “My company is a part of my life” logically leads to the question: “What is really important in my life?” To be able to reach his own goals effectively, he should be very clear about his values and keen to develop his own skills. Company development makes it very clear what the entrepreneur would like to change in his life and how to approach this change. Thus it is the first step in the subsequent development of the company. The company development process makes sense if the entrepreneur wants to once again take on more of the role of a business shaper, instead of letting himself be shaped by others. But how is this development in the entrepreneur perceived within the scope of company development?
The next step focuses on strategy development. Based on the realizations derived from the entrepreneur’s personal development, he will develop his business goals and will transfer these to the company. To successfully put these into practice, managers and employees develop professionally as part of organizational development by training their thinking and skills. Thanks to this type of empowerment, they actively contribute to shaping change within the company by adjusting processes and systems to match changing requirements. For example, digital transformation in a company begins in the minds of the employees and only then does it move to upgrading the actual hardware and software. In this way, an entrepreneur creates a company culture of co-creators. What was once an entrepreneur becomes a community of entrepreneurs.
So within the scope of organizational development, it is important to turn company employees into co-entrepreneurs. The trend toward agile methods and working within structured projects clearly shows that success depends more than ever on using skills and coordinating this properly – not just among managers, but also between managers and each individual employee. A look at current employment histories confirms this trend. Projects, tasks, and responsibilities change quickly. This places strong demands on each individual entrepreneur in the company, not only in terms of their specialist skills, but especially in terms of interdisciplinary skills. The most important success factor in the company is the organization’s ability to set up dynamic structures and teams that more or less organize, dissolve, and develop on their own in order to reach goals. In an age when (specialist) knowledge is available ubiquitously at any time, knowledge about the specialist skills of each individual becomes secondary. It’s much more their general skills that allow people to succeed in a highly dynamic environment. It is the need to organize oneself, communicate effectively, and develop and actively implement creative ideas that determine success or failure. Classic management structures based on hierarchies are clearly insufficient in this regard, or too rigid.
More specifically, as a first step, companies have to do more in the future to create more transparency regarding the interdisciplinary skills of everyone in the company. The question as to who takes on responsibility for which task has to be approached from the perspective of skills, and not based on structures that have developed over time.
The second step is then to develop an organizational culture that can match the dynamic demands of markets and which can be further developed with the commitment of each individual. The aim is having intrinsically motivated employees, who are not just aware of the company’s aims and strategies, but who have also compared these to their own personal aims and have linked the two. This is how employees become co-entrepreneurs, who independently recognize the time for change and actively shape it. In this way, change management – which all too often imposes decisions top-down, despite resistance within the company – suddenly becomes change supervision based on employee participation. It is then something that supports and promotes employees to get organized in line with the company’s goals as well as their own.
The decision to go back to shaping things autonomously can trigger the necessary impetus. While the complicated, time-consuming analysis and design process is underway, there are actually ways to shorten analysis and planning phases in order to accelerate the overall process. This entails identifying obstacles to success and hindrances early on. The top priority has to be to introduce measures that are an exact match with requirements and all resources should be put to use where they are most useful – in implementation and the final outcome.
The Steinbeis Consulting Center for Business Excellence supports startups and existing SMEs with company development and organizational development. The guiding principle for this is “people first” – everything revolves around the individual. That applies in same measure to business owners, business directors, managers, and employers. As part of their service portfolio, the Steinbeis experts use established methods and tools for strategy and organizational development, in addition to methods based on the results of independent research.
Markus Riehl, Dr. Lars Öhler, Dr. Uta Hessbrüggen
Steinbeis Consulting Center Entrepreneurial Excellence (Stuttgart)
su1667@stw.de