Entrepreneurial Synergy


“People who say it cannot be done should not interrupt


 those who are doing it.” 1– George Bernard Shaw

Large business organizations are usually structured as a set of inter-related divisions or Business Units that come together to form an integrated enterprise. Each division is typically placed under the charge of a senior Executive, who usually reports to the Chief Executive Officer of the enterprise. Executives are placed at the fourth rung on the hierarchical ladder of accountability.

The executive role demands excellence from a functional as well as a business perspective. While functional maturity translates as the ability to think about the function from multiple perspectives, business maturity involves the development of a holistic view of the business.

Seasoned executives always keep the big picture in mind, even as they pay close attention to the details. They transcend the “silo” mentality, and evolve from a narrow dedication towards their own Business Unit to the success of the entire organization. Executives also collaborate with their colleagues across divisions, and support the accomplishment of one another’s strategic work. Considering the impact of local decisions upon the larger institution is the key to executive success.

In order to serve customer needs, and create extraordinary value from limited resources without antagonizing any of the stakeholders, executives adapt as well as innovate their way along. They assume significant personal and organizational risk in doing so. In effect, corporate executives adopt an entrepreneurial approach to their work.

The process of entrepreneurship involves uncovering, seizing and developing an opportunity to create value, regardless of the adequacy of the material, capital and the human resources available with the enterprise. Entrepreneurs are social architects who foster creativity and facilitate the development of new ideas. They adopt an innovative approach, in order to create radically new products and services.

However, the task of business executives is relatively more complex than that of individual entrepreneurs. Executives operate within an organizational setting that is characterized by diverse stakeholders with widely varying and conflicting needs, values, and perspectives. These corporate entrepreneurs (also known as intrapreneurs) are thus required to grapple with several mutually opposing ideas or priorities at any given time.

Always keeping the big picture in mind while they work on the individual segments of a problem, entrepreneurial executives search for creative resolution in convoluted circumstances. They reconcile all the disparate and competing aspects in a situation, without selecting one extreme at the expense of the other. When at their very best, executives manage to synergistically fuse together numerous contrasting perspectives towards collective benefit.

This synergistic approach helps to create an integrated solution in a dichotomous situation such that no value is compromised, lost or given up. The true executive is thus an alchemist who innovatively transforms conflict into synergy, in the manner of a classic entrepreneur.

The Phenomenon of Entrepreneurship

Entrepreneurship is the process of generating something valuable, by turning ideas and inventions into profitable products and solutions that create value for the customer. This process simultaneously yields satisfaction, independence as well as monetary gain for the entrepreneur. 

Entrepreneurship creates value by endowing existing resources with new wealth-producing capacity, or shifting these resources into areas of higher productivity and yield. Relatively less concerned with immediate efficiency, entrepreneurs usually prioritize long-term value. 

An entrepreneurial vision arises out of intuitive and holistic thinking. Entrepreneurs employ their imagination in order to identify what is lacking or absent, and create new opportunities for serving social needs. Their work ranges from original conceptualization to creative imitation. 

An entrepreneurial opportunity is any possibility for recombination of resources that is expected to be profitable. It may take the form of a new product or service, geographical market, operational process or management practice. Such opportunities must be recognized, discovered or created before other people catch up on the idea. Thus, entrepreneurs must have superior information. Alternatively, they must possess the capacity to interpret the same information differently. 2

Once the idea, opportunity or cause is identified, entrepreneurs create support for it through persuasion, influencing as well as negotiation. Being proactive individuals with a strong inclination for action, entrepreneurs pursue the selected opportunity with their heart and soul. They do not hesitate to behave and act in ways that depart from the customary methods of doing business. And somehow, they always seem to find a way forward.

Entrepreneurs prefer loosely structured situations. They discard the generally accepted perception of problems and issues, and creatively reframe their view of the circumstance. Entrepreneurs learn fast within a dynamic environment, and also provide clarity for those around them. They use new data as an opportunity to set up revised structures, systems, and practices – even when these may pose risk to the current paradigm.

Entrepreneurs assume tremendous personal, social and financial risks. They make decisions with incomplete information, in the face of incalculable and uninsurable business hazards. As a result, they possess a considerable tolerance for ambiguity. 3

In essence, entrepreneurship represents organizational behaviour that relates to change and innovation. While the concept is popularly associated with new or small enterprises, Peter Drucker emphasized that entrepreneurship is an integral part of all kinds of organizations. 4

The Executive Challenge

The primary challenge faced by business executives is that of achieving sustained organization effectiveness in a fractured and dynamic environment. Modern enterprises demand stability and growth, long-term planning and short-term decisions, tradition, and innovation, collaboration and competition, order and freedom – all at the same time. 

Therefore, executives confront new challenges and unfamiliar conflicts every day. They are often called upon to do things that appear to be mutually exclusive at first glance. For instance, executives need to focus on the future even as they must pay close attention to the present at the same time. “Command and control” is often necessary, even as “empowerment and delegation” is almost mandatory in order that the enterprise may serve complex market needs in real time.

Even as they seek to protect the stability and continuity of the organization, executives are required to encourage innovation and risk-taking as a survival tactic. And then, they must find a way to evoke intense cohesion and collaboration among their colleagues in a competitive landscape where long-term job security can no longer be promised. 

In order to excel, executives must thereby embrace a diverse set of competing values, priorities or perspectives that appear to be in mutual conflict – even as they are simultaneously critical for the accomplishment of organizational objectives.  This makes it imperative for executives to navigate judiciously in a world that is replete with paradoxes and dilemmas, which are situations wherein two seemingly inconsistent values or contradictory ideas are both true at the same time.

Transcending such paradoxes requires a serious reconsideration of some popular reductionist beliefs and assumptions. Executives need to adopt a more balanced and integrative approach to their work. Research confirms that executives who balance competing roles are evaluated as being more effective. 5

 The key to executive success perhaps lies therein!

Framing the Executive Challenge – The Competing Values Framework

Executive success is a function of the recognition that the opposition between apparently conflicting polarities is merely a screen that veils their complementary nature. Robert Quinn’s time-tested Competing Values Framework (CVF) offers a robust formulation that highlights this phenomenon in the form of two pairs of dimensions of organizational effectiveness that appear to be in mutual conflict. 6

The first dimen­sion of CVF contrasts an emphasis on “flexibility, discretion, and dynamism” from the emphasis on “stability, order, and control.” This continuum ranges from versatility and pliability at one end to steadiness and durability on the other. The second dimension differentiates an internal orientation with a focus on “integration, collabo­ration, and unity” from an external orientation with a focus on “differentiation, competition, and rivalry.” 6This particular continuum ranges from cohesion and consonance at the one end to separation and independence on the other.

When these two dimensions are juxtaposed with one another, they form four quad­rants. Each quadrant highlights a core value that is opposite to the value on the other end of the continuum, i.e., flexibility versus stability and internal versus external focus. 6

The upper left quadrant identifies values that emphasize an internal, organic focus, whereas the lower right quadrant identifies values with an external, control focus. Similarly, the upper right quadrant identifies values with an external, organic focus whereas the lower left quadrant emphasizes internal, control values. 6The values represented by any one quadrant are not necessarily superior or more preferable than those symbolized by the other quadrants.

The “create” and the “control” persuasions usually do not see eye-to-eye. If their writ were to run alone, the “create” proponents might easily become mavericks who do not relate with the rest of the organization. On the other hand, the “control” proponents may similarly become static bureaucrats when they are left unfettered. 

Likewise, the “compete” and the “collaborate” proponents are also at loggerheads. However, in actual practice, the “compete” proponents mitigate the “collaborate” tendencies of groupthink and irrational enthusiasm while the “collaborate” proponents tone down the “compete” traits of impatience and immediacy.

These opposing values thus represent competing assumptions that are actually inter-dependent (like the two sides of a coin), but may nevertheless result in constructive conflict. The salient executive challenge is to synergistically leverage the tension between these pairs of symbiotic forces, in order to innovate entrepreneurial solutions that capture the “best of both” worlds. 

The Business Executive as a Corporate Entrepreneur

Executives promote innovation by challenging rigid mindsets, and effectively managing various kinds of risk. This enables them to create a proposition that delivers superior value to the customer, and simultaneously fulfills the strategic objectives of the organization. 

In order to flourish, executives emulate the approach of independent entrepreneurs. Working from an internal organizational perspective, they promote creativity and innovation of various kinds. In the executive context, innovation refers to a multi-dimensional effort that yields a new concept, design, or outcome through a symbiotic or synergistic integration of existing knowledge and techniques.

Innovation can be radical or incremental. While radical innovations may be revolutionary, discontinuous, original, and pioneering, incremental innovations are small improvements that serve to enhance and extend the established processes, products, and services.

Innovation may relate to a product, or to a process. Product innovation reflects a change in the end product or service offered by the organization, whereas process innovation represents some changes in the way that the firm manufactures or creates the end product or service. 7

Innovation is often technological. However, it may also be administrative in nature. Technological innovation relates to the endorsement of a new idea that directly influences the basic output processes, whereas administrative innovation includes the changes that affect the policies, allocation of resources, and other factors associated with the social structure of the organization.

Entrepreneurially oriented executives examine situations from previously unexplored perspectives, take significant risks, and remain operationally nimble. They craft a strategy after carefully assessing the challenging situation or potential opportunity, and then bring together the necessary resources for securing favourable outcomes.

Corporate entrepreneurs work broadly within the ambit of organizational policies and procedures, but often become the revolutionaries who work towards change and renewal from within the system. While the organizational context implies restrictions, it also provides them with a considerable amount of support, security, and leverage towards balancing competing values, achieving stakeholder delight, and guiding their respective businesses towards excellence.

The Executive Mandate – Generating Entrepreneurial Synergy

Modern business enterprises are complex and dynamic relational systems that are run by entrepreneurially oriented executives. Their success hinges upon a demonstrated capacity to:

  1. Organize for the creation and refinement of a variety of new products, services, and solutions
  2. Translate this output into superior value for the end customer, and
  3. Adequately meet the concerns and requirements of the numerous stakeholders of the enterprise 

The act of creating value through innovation is accomplished by the creative transcendence of dichotomy. This was hitherto considered asde rigeuronly for independent entrepreneurs. Now, it has become mandatory for corporate executives too.

Outstanding executives do not view pairs of opposing values or conflicting priorities as competing, zero-sum games that call for compromise. Rather, they seek to maximize both the polarities before ingeniously integrating them together. This allows them to harness synergy from their partnership. Instead of accepting a trade-off between the diverging elements, the synergistic approach works on a logic that integrates differences at every opportunity.

The term “synergy” describes the capacity of two persons, forces, or structures to work together in a mutually fruitful way, so as to produce a combined effect that is significantly greater than the sum of their individual effects. Synergy is accomplished by transforming the competitive relationship between potentially opposing values into a complementary one. In such a situation, doing (more of) any one must increase the returns from doing (more of) the other. 

The integrative effort involved in generating synergy requires dynamism in perception, divergence in thinking, affective flexibility, and the capacity for behavioural complexity.

Perceptual dynamism is the capacity for reframing situations, such as the viewing of problems as opportunities. Divergent thinking is the ability to spontaneously draw upon ideas across domains in order to reach a deeper understanding, so as to generate multiple answers to a given problem. 8

Affectiveflexibilityisthe ability to easily switch back and forth between processing the emotional and non-emotional aspects of a situation, in order to make decisions. Behavioral complexity refers to the capacity to conceive as well as perform multiple roles simultaneously.

Synergistic integrationyieldsadramaticsenseofachievement as well asan experienceofsatisfaction for allthestakeholdersinvolved.

The Development of Entrepreneurial Synergy

Entrepreneurship is the process of innovatively endowing existing resources with additional value. For instance, according to the mathematician, one and one may equal zero, one or two – depending upon whether they are subtracted, divided or added. However, an agile entrepreneur would recognize that these could be synergistically combined to make eleven too!

The fable of“The Blind and the Lame Man”provides an anecdotal illustration of the phenomenon of synergy. It recounts how two people utilized their individual capability in an effort to overcome their respective disabilities. The blind man carried the lame person on his back, and thus lent him the use of his feet while utilizing the benefit of the latter’s eyes. The outcome was mutually beneficial. 

In the business domain, the Swedish furniture retailer Ikea achieved international success by creatively combining excellent product design & display with low-cost manufacturing, sourcing, and storage. The company was thus able to deliver inexpensive furniture that was highly elegant and of good taste. Similarly, the Indian automobile industry harnessed the Total Quality Management paradigm during the 1990s in order to synergistically enhance quality as well as affordability.

The development of such synergy entails a three-step process sequence, which helps people to arrive at a harmonious solution or an innovative outcome in any situation of divergence. While the threestagesare sequential, theprogress happens iteratively. These phases are as follows:

a) Respect:Acknowledge merit in each of the respective values

b) Reconcile: Integrate and harmonize the apparently competing or conflicting values 

c) Realize:Harnessthebenefitsthat arisefromthe complementarityofthese values.

The Entrepreneurial Synergy Framework

Entrepreneurial synergy arises from an active progression through the three distinct stages of Respect, Reconcile and Realize. Each stage operates concurrently across the affective, cognitive and conative dimensions of the human personality.

 On the affective plane, the phenomenon of inclusion (a felt connection between individuals or groups) facilitates integration (assimilation of divergent needs and views of the people) in due course of time. This eventually leads to the development of resonance (a felt sense of energy and rhythm).

At the conativelevel, the process of synergy progresses through inquiry(respectfully asking questions) that facilitates genuine dialogue(exchange of ideas with a view to reaching an amicable understanding) and culminates into resolution(incorporation of contradictoryoptionsintoaunitaryscheme) of the conflict or dilemma.

With respect to the cognitivedimension, synergy arises from multiple insights(understandingofaspecificcause/effect) that facilitate retroduction(adoption of a provisional hypothesis that can be experimentally tested), leading to the capacity for innovation(creative breakthrough that leads to a novel solution).

The endeavor of entrepreneurial synergy commences with Inclusion, which entails an appreciative expansion of one’s sense of identity. The fulcrum of the synergistic undertaking is Integration, whereby the opposites or conflicting attributes are brought together so as to make each other complete. This is akin to how the mutually opposing polarities of the North and the South poles are both necessary to make a complete magnet. The fruit of this apparently alchemical effort is Innovation, whereby a tricky problem is solved or an ingenious solution is created.

The Respect Phase

The term “respect” denotes a particular way of looking at or thinking about some object or situation. A person who respects something pays close attention to it, and perceives it differently from others. This perceptual element also characterizes the synonyms of respect, such as regard (i.e. to watch out for) and consideration (i.e. examine carefully). An attempt to see the situation clearly in its own right, without the filter of one’s desires, fears and biases, is an indicator of respect. 

The idea of giving proper attention to the object is thus central to the phenomenon of respect. In the Respect Phase, the phenomenon of interdependence as a feature of life entails the inclusion of other people into one’s own sense of identity. Subsequently, the mode of respectful inquiry is adopted to learn about the uniqueness of the other person or the circumstance. Finally, paying keen attention helps to generate insight into the other person or situation.

The Respect phase is thus concerned with gaining a comprehensive understanding of the other entity.

Inclusion

Humans are inherently social beings who thrive in a“connected” world. They develop distinctive individual identities through participation and inclusion in relationships of different kinds. 9

Inclusion reflects the understanding that all beings in nature are inter-dependent, even though not identical. It refers to the practice of affiliating with, and caring for, other people. Inclusion entails inviting every individual to engage with the social process in the fullness of her capacity.

A relationship begins when two (or more) people come into each other’s experienced presence. Inclusive relationships develop as a result of congruent and empathic attunement between two or more individuals. This calls for the individuals to get along, while recognizing their respective faults as well as gifts. Effective inclusion involves sensitivity towards individual needs and differences.10

Inquiry

Inquiry refers to the seeking after knowledge, information or the truth of a matter of one’s interest, through a systematic investigation. It is the process of respectfully asking about, or examining, something in order to get more information. Inquiry involves asking questions in order to unlock essential information that is vital towards the resolution of the situation.

Inquiry presupposes listening with the intention of genuinely understanding the thoughts and feelings of the other person. The inquirer suspends judgment, and tries to comprehend how and why the other person has progressed from the data of her experiences to arrive at a particular interpretation or conclusion. 11At its best, the process of inquiry yields a true picture or an authentic reflection of the situational reality.

Insight

The term “insight” refers to a sudden comprehension that solves a problem or resolves an ambiguous percept. It also denotes a piece of information or the act of understanding the inner nature of things.

Insight denotes a mental restructuring that leads to a sudden gain of explicit knowledge that facilitates changed behavior.12 When people unexpectedly see the connections that had previously eluded them, they are said to have a flash of insight. 13Insight is often acquired through the process of conducting a non-judgmental inquiry. However, it may also arise from an understanding of the inner nature of things, or by means of intuition and even introspection. In their extensive research, Kounios and Beeman found that insight appears to pop into awareness seemingly out of nowhere.11 It literally yields a different way of looking at things.

The Reconciliation Phase

Reconciliation refers to the process of enabling two apparently conflicting objects, values, perspectives or interests to become congruous or consistent with each other.14 Each of these two perspectives has its own merit, which cannot be sensibly ignored or dismissed. 

This gives rise to a situation of paradox or dilemma, whereby both the opposing entities need to be simultaneously carried together. 15 The way out is to bring the opposing persuasions together in a manner that leverages the positive worth in each of these two seemingly conflicting perspectives. Reconciliation is the process wherein the respective merits of opposing perspectives are integrated together, in order to arrive at a “win-win” outcome.  16

The process of reconciling a conflict is initiated with the integration of polarities on the affective plane, accompanied by conscious dialogue at the behavioural level. It culminates into a plausible new hypothesis or plan of action that incorporates all the available insights by means of the process ofretroduction.

Integration

Integration is the act of organizing a set of disparate elements into a unified pattern. It also refers to the combining of an entity’s constituent components into a harmonious whole.

Integration is the capacity to simultaneously hold two diametrically opposite ideas or values deep within. This helps to generate a synergistic outcome that is superior to either of these opposing views.

 Integration involves facing the tension of clashing perspectives constructively, and generating a new viewpoint that contains elements of both the former perspectives. It employs a “both/and” approach that sees a fact or to be true, but also looks upon a contradictory factor to be simultaneously true17 This creates value by way of a coherent synthesis of seemingly opposed values, through the transcendence of conceptual limitations.

Integration unifies opposing values, as symbolized by the Chinese pictogram of “Yin-Yang.” It collates many small components into a single, unitary and comprehensive system.

Dialogue

Dialogue refers to a written or conversational exchange of ideas and opinions between two or more people, with a view towards reaching an amicable understanding or agreement. It is a collaborative exercise, wherein participants work together to explore common ground that eventually leads to a shared understanding. Dialogue is designed for situations in which people have fundamentally different frames of reference. 18

One of the cardinal principles of dialogue is the surfacing and questioning of underlying assumptions that are usually buried deep beneath the surface. In any effective dialogue, much time and effort is spent in uncovering and excavating these hidden aspects of the dispute. The use of. “them”and“us”gradually transposes into a credible and durable“we”. The energy evolves toward the transformation of the dichotomous situation. The stage is then set for a break-through.

Retroduction

Retroduction is a form of logical inference. It leads to the formulation of a theory or hypothesis that provides the simplest, best, and most likely explanation for a set of observations. 19Retroduction facilitates the development of new explanations, by means of a cerebral process that is relatively unhampered by logical rules. 

Retroduction is a leap of the mind that brings together ideas that may never have previously been associated with one another. It has a logicalas well as an innovativecharacter that extends into profound insight. Retroduction thereby helps to discover new knowledge in a logical and methodologically ordered way.20 In the face of unexpected or surprising facts and observations about a situation, retroduction helps to create a new order that offers a fitting explanation of those facts. 

The first step in the retroductive process is to find or develop a hypothesis, by means of abduction. The second step consists of deriving predictions from the hypothesis, which is deduction. The final step consists of the search for factsthat will “verify” the assumptions, through induction. This cycle of abduction, deduction, and induction is iteratively repeated, until all the facts finally fit together.

The legendary Sherlock Holmes and other detectives of his ilk extensively employed retroduction. They were thus able to “magically” solve crimes that remained as conundrums for the investigative agencies.

The Realize Phase

Realize refers to the capacity to bring something into concrete existence, or to carry out an act or process to completion or fulfillment. Its literal meaning is that of turning something fictitious into concrete reality, or actualizing that which was previously only imaginary in nature. The realization of a plan requires the flexibility and agility to generate adaptive solutions that draw out the best from among the multiple perspectives in any given situation.

To realize synergy, executives begin by developing affective resonance across the organization. Competing perspectives are brought to a mutually satisfactory resolution. The process culminates in the generation of innovative and synergistic solutions.

Resonance

Resonance represents a physical phenomenon, wherein vibrations are transmitted from one vibrating body to another in the absence of any physical contact between the two. Resonance is the amplification of effect that occurs when the respective energy of two or more entities get in step or phase with each other. 

When human beings exist in close physical proximity with one another, the first level of interchange usually occurs at the rational or the cognitive plane. An exchange of ideas takes place. The next level of interaction occurs as an energetic connection between the people concerned. Finally, the level of connection that is felt intuitively constitutes resonance. 

Resolution

Resolution is the phenomenon of having something settled. It refers to a situation where no problem or conflict exists. Resolution is an interactive process of collecting all the different (or even contradictory) principles, values and perspectives, and incorporating these into a single, unified whole that yields a voluntary agreement or solution.

Resolution represents a transformation of the relationship between the entities involved. It employs a win-win approach, which is a conscious and systematic attempt to maximize the goals of both parties through collaborative problem solving.21 The focus is upon the needs and constraints of all the parties involved, rather than emphasizing strategies that are designed to conquer. 

Resolution thus represents a methodology that channelizes the energy and momentum of mutual differences towards creating common ground, so as to arrive at mutually beneficial outcomes. 

Innovation

Innovationrefers to the generation and application of creative solutions, in order to meet new or existing needs. 22 It is the process of translating an idea or invention into a solution that creates quantifiable value. Innovation involves the deliberate application of information, imagination, and initiative so as to help derive greater value from the resources. 23

Innovation thrives upon the constructive leveraging of the differences between individual values, personalities, cultures, roles as well as perspectives. When differences are viewed as complementary qualities, they may be suitably assimilated in order to yield innovative results in ways that are fair, honest and mutually beneficial. Depending upon its use and application, an innovative solution may take on different forms – a product, a service, a process or a breakthrough.

References

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