Decisions, risks and entrepreneurs

The next post will cover this subject in more detail, but meanwhile here is a hint of what is to come. The idea that entrepreneurs manage risk and uncertainty; and make decisions differently has been researched by Saras Sarasvathy. Successful entrepreneurs were studied to detect these patterns – and the results are insightful, but also feel intuitively correct. It is called “effectuation”. And all you corporate people – note it is also valid and important for large organisations too!

So .. how do entrepreneurs handle risk and uncertainty? What do the successful ones do differently? How do you plan when you are dealing with new and unknown markets?

Attached is a visually attractive depiction of the study and the results.

Effectuation – entrepreneurial decision making

 

 

A Brave New World

This week the World Economic Forum kicked off in Davos – and as always, we will be following it with interest and alerting our clients and readers to interesting forums and discussions.

Not coincidentally, this is also the week that we are launching our new “Brave New World” initiative. The tough economic times continue to a greater or lesser extent depending on your perspective (country, industry, region, …) and we believe the green shoots are showing or about to show. The biggest challenge many organisations face is that the business environment has changed fundamentally but many are still looking in the rear-view mirror to plan the road ahead. Coupled with that is that many are also in survival mode – with a strong internal focus on cost containment.

Resources tend to be stretched especially at executive level and although we know we should be considering the broader trends and fundamental changes that have been happened, we seldom give ourselves the opportunity to read and absorb some of the material out there (such as is coming out of the World economic Forum) – to say nothing of sitting down as an executive team to discuss the implications and opportunities for the organisation.

The BraveNewWorld challenge is to change this mindset in your organisations (if it exists) and proactively look at the new “world” you will be facing, with a perspective of seeking opportunities and growth. Taking the time out to assess the future NOT through the perspective of the rear-view mirror, but from the perspective of what the future might look like. Contact me at BraveNewWorld@GenesisMC.co.uk to discuss how we might be able to offer assistance in this process.

Back to Davos, the theme of this years conference can best be described using Professor Klaus Schwab’s words:
“Today, we live in the most complex, interdependent and interconnected era in human history. We are increasingly confronted by major adaptive challenges as well as profound transformational opportunities. This new leadership context requires successful organizations to master strategic agility and to build risk resilience.”

Later posts will discuss specific debates at Davos, but for this first post I should like to bring to your attention the WEF TV channel at http://www.weforum.org/events/world-economic-forum-annual-meeting-2013 . As I write this, I am watching a discussion called “De-risking Africa” with discussions from Clayton Christensen (disruptive technologies) and Global Risks due in the next few hours. Incredible stuff and whether or not you agree with the opinions expressed, it should certainly stimulate your thinking.

And finally, congratulations Charlize on your Crystal Award. Beauty, brains and empathy  …..  an exceptional and rare combination.