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Leadership

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Entrepreneurial Leadership

Strayer University – Online

Professor Michael Powers

January 21, 2011

Abstract

Today’s entrepreneurs can learn how to profit and be social responsibility by studying the leading entrepreneurs of the past. In this paper we will learn Jack Welch and Dirk Mueller-Remus leadership style, and major business principles for a profit-oriented entrepreneurial approach in which the primary goal is to provide a product or service to consumers and to make a profit. Also their major business principles for a social-responsibility oriented entrepreneurial approach in which the primary is goal to make a positive impact on society (people, families, ecology, or similar) while providing a product or service to consumers and to make a profit. This paper will also show what three resources or tools available through the Small Business Administration and SCORE would be the most useful.

Analyze and describe the founding leader(s), leadership style, and major business principles of a profit-oriented entrepreneurial approach in which the primary goal is to provide a product or service to consumers and to make a profit.

The founding profit oriented leader is Jack Welch. He had a successful strategic plan with an aggressive approach to we maximize the opportunity. He will confidently say that the bottom line for most if not all entrepreneurs are to take care of their bottom line – income. Being able to make a residual income from your business makes it that much more enticing to stay in business for yourself.

Jack Welch is "the celebrated leader of a global manufacturer often noted for its technological prowess, he has utilized a very human process to drive change through GE's vast organization. Having respect for the individual as a pivotal force in organizational change, Welch created a model of exceptional performance every corporate leader can learn from. As Jack Welch wrote in a letter to shareholders: "In the old culture, managers got their power from secret knowledge: profit margins, market share, and all that... In the new culture, the role of the leader is to express a vision, get buy-in, and implement it. That calls for open, caring relations with every employee, and face-to-face communication. People who can't convincingly articulate a vision won't be successful. But those who can will become even more open - because success breeds self-confidence. “Under Welch's leadership, managers have wide latitude in building their GE units in entrepreneurial fashion. Determined to harness the collective power of GE employees, Jack Welch redefined also relationships between boss and subordinates. He wrote: "The individual is the fountainhead of creativity and innovation, and we are struggling to get all of our people to accept the countercultural truth that often the best way to manage people is just to get out of their way. Only by releasing the energy and fire of our employees can we achieve the decisive, continuous productivity advantages that will give us the freedom to compete and win in any business anywhere on the globe." Six Rules for Successful Leadership from GE’s Jack Welch • Control your destiny, or someone else will. • Face reality as it is, not as it was or as you wish it to be. • Be candid with everyone. • Don't manage, lead. • Change before you have to. • If you don't have a competitive advantage, don't compete. (www.1000ventures.com) Analyze and describe the founding leader(s), leadership style, and major business principles of a social-responsibility oriented entrepreneurial approach in which the primary is goal to make a positive impact on society (people, families, ecology, or similar) while providing a product or service to consumers and to make a profit.

A social enterprise is designed to operate like a for profit business. Social enterprises rely primarily on their earned income stream, and like any other company, if needed; it takes loans, invites capital investments, and forms partnerships etc. in order to expand its business activities. (www.greenmarketing.tv) Social responsibility identifies the impact of the company's business and actions on the society as a whole. It assumes that the company has a responsibility not just to its stakeholders, but to the entirety of the society. Dirk Mueller-Remus is the founder of AUTICON. Nearly 1% of the world‘s population has autistic behavioral characteristics. There is a special form of autism called Asperger‘s autism. Approximately 15% of people with Asperger‘s syndrome demonstrate above-average capabilities in the IT field. Because of their limited social skills in terms of interaction and communication, they have little chance to obtain a good education, let alone to pursue a successful career. In Germany alone, the state spends billions of euros per year to support half a million people with autism. In the long run, it makes more sense to put these capable, often very talented people in a position to earn money themselves and thus become active members of our society and our economy. AUTICON employs individuals with these outstanding abilities in specialized IT services such as software testing. With their attention to detail and sustained high concentration levels in repetitive tasks, the employees of AUTICON achieve significantly lower error rates than the average IT tester. Companies employing AUTICON IT testers will be provided with training in how to deal and communicate with autistic people. The social business AUTICON employs individuals with these outstanding abilities in specialized IT services such as software testing. With their attention to detail and sustained high concentration levels in repetitive tasks, the employees of AUTICON achieve significantly lower error rates than the average IT tester. Companies employing AUTICON IT testers will be provided with training in how to deal and communicate with autistic people. AUTICON’s Support by the Social Venture Fund allows for: • Economic: contributing to the society as a whole encourages stakeholder and customer loyalty -- and increases profits. In the pursuit of maintaining competitive advantage in their market and industry, companies must at the same time seek to exploit efficiencies to eliminate waste. • Ethical: Companies must respect the society's values and norms and operate consistently with the society's expectations. Corporations must act fairly, morally and respectfully. • Legal: In the legal component of social responsibility, companies must work within the law and the government. • Philanthropic: Philanthropy can include charitable donations, fundraising, encouraging the staff to volunteer or adopting special projects. Projects that enhance the quality of life for the residents of a community show the company's commitment to the society's quality of life. (www.ehow.com) The total need for capital invested by the Social Venture Fund for the market entry of AUTICON in Germany amounts to 500,000 EUR. The capital will be paid in four tranches as mezzanine financing with a reasonable fixed interest rate. In addition, the investors of the Social Venture Fund will participate in the success of AUTICON. Participation is limited to five to six years. The repayment of the patient capital comes from AUTICON’s surplus, generated by its own procurement of software testers with autism to customers. In addition to financial support, the Social Venture Fund will serve on the advisory board and offer support through its network of active investors. Support is given as tangible support; help with selecting and appointing new team members and consultation during the roll-out of the project. The Social Venture Fund will also assist AUTICON in identifying new potential clients from the private sector (www.socialventurefund.com).

Determine the approach and leadership style with which you most identify and explain your reasons for your choice. Entrepreneurs build companies, get profit, and gave back to society in many ways. One of the big questions is how we differentiate between profit and contribution. The answer is different sentences, different point of view, and different concentration of aspect. We know that companies need profit to stay alive, and by staying alive, the chance to contribute in society will be always there by giving people chance to get a job, or social responsibility program that has been pretty hip today, or you name it. Companies need money, they need profit, and that would be the main goal today in building the company. Entrepreneurs that build companies and become private sectors, they natural habit would be profit-oriented. I even have a slight thought of pessimistic on whether there are social-entrepreneurs prior to this assignment. Private sectors don’t think about society/people in the area, neighborhood or country. It’s not their concern though not always heartless but sometimes so-called rationality of private sectors competes and wins from the heart (www.allstarttoday.tumblr.com).

The question is how you concentrate on profits until you give back to society? Or whether do you think that social acts and profits are two things that can go along together? I think that they work hand in hand. However my leadership style would mirror that of a Social entrepreneur. Social entrepreneurs are visionary individuals with creative solutions for solving some of the world. These people have the ability to identify the problem, develop a way to change the system, and disseminate the ideas so that entire societies work together to raise themselves above crisis. Social entrepreneurship is the art of creating a socially responsible business that aims to generate profit, while solving social and environmental problems. Social entrepreneurs start and run social enterprises – commercial businesses that often come with a “triple bottom line” mandate. The triple bottom line refers to people, profits, and the planet. TBL implies that businesses can and ought to be run in a financially, socially, and environmentally responsible manner. If your mind is overflowing with sustainable, actionable solutions for common social problems and you got a passion for making a big difference in the world, you may just be a social entrepreneur in the making. With growing challenges such as extreme poverty, environmental sustainability, educational deficits in developing countries, and the spread of virulent diseases, the world needs people with the ideas and the drive to fundamentally shift society as we know it today. Companies must be committed to the values of the society, they must be contributors to the environment and they must contribute to the economic and social goals of society (www.greenmarketing.tv).
Determine what three resources or tools available through the Small Business Administration and SCORE would be the most useful to the type of business and entrepreneurial approach you identified with. Explain your reasons. The benefits of the Small Business Association or SBA, an independent agency of the federal government to aid, counsel, assist and protect the interests of start- up and established small businesses. In addition to financial assistance, contract opportunities and disaster assistance, the SBA also offers small business counseling and training through a variety of programs and resource partners. The SBA is the government’s source of information on small business and provides guarantees to lenders for small business loans. One of their primary resource partners, the Service Corps of Retired Executives, Thru SCORE Association also known as “Counselors to America’s Small Business” is a nonprofit association comprised of 11,500 volunteer business counselors throughout the U.S. and its territories. Working and retired executives and business owners donate their time and expertise as volunteer business counselors and provide confidential counseling and mentoring free of charge. SCORE members are trained to serve as counselors advisors and mentors to aspiring entrepreneurs and business owners. The association is dedicated to educating and assisting entrepreneurs in the formation, growth and success of their small business. These services are offered at no fee, as a community service. Many of the programs offered by SCORE help facilitate the process of getting a SBA-backed business loan. The organization supports small businesses with both training and business counseling. Whether you are just starting out, or have been established for quite some time, SCORE can set you up with a personal business coach who can guide you along every step of your business (www.sba.gov) In conclusion, there are certain recurring qualities that seem to surface in the best leaders. Great companies enhance their business knowledge into a coherent plan for achieving leadership success. A great leader presents and evaluates leadership principles in action and shows how managers can change their businesses into successful companies.

References

Allstarttoday. (2010) All Start Today - Social & Profit-Oriented Entrepreneurs Retrieved January 21, 2012 at www.allstarttoday.tumblr.com/post/.../social-profit-oriented-entrepreneurs

EHow Money. The Four Components of Social Responsibility. Retrieved January 18, 2012 at http://www.ehow.com/info_8219984_four-components-social-responsibility.html#ixzz1kDcvDsgO

Green Marketing TV. (July 2010). What is a Social Entrepreneur? Retrieved January 20, 2012 at http://www.greenmarketing.tv/2010/07/05/what-is-a-social-entrepreneur/

Kotenlnikov, Vadim.Jack Welsch. Retrieved January 19, 2012 at http://www.1000ventures.com/business_guide/crosscuttings/cs_leadership_welch.html

SBA.gov. Thinking about starting a business. Retrieved January 22, 2012 at http://www.sba.gov/content/score

Social Venture Fund. (2011) CASE-STUDY AUTICON Retrieved January 21, 2012 at http://www.socialventurefund.com/eng/social_entrepreneurship/case-study_auticon/

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