Leadership and Management Skills
Entrepreneurs must possess an array of traits and skills that allow them to be effective and successful. Two of the most important skills are leadership and management. These two skills are vital to making a new organization profitable and efficient.
As managers, entrepreneurs must be able to understand concepts such as cash flow, human resources, and market conditions (Thornberry, 2006 pg. 16). Along with understanding managerial concepts, entrepreneurs need to be able to direct employees through work processes and utilize the organization's resources. For example, as a manager, an entrepreneur must recognize where there is inefficiency in the workflow and be able to direct resources to that inefficacy. Mangers routinely need to redirect workforces to different areas of the company to fill in gaps or shortages in manpower. As well, managers must watch overtime and operate within budget parameters. These are some of the basic functions managers and entrepreneurs must be able to accomplish. As well, the managing entrepreneur must be able to communicate their directives and make sure that the company standards are being met. These are management functions that are essential to the entrepreneur because he or she will be defining the company’s processes.
As leaders, entrepreneurs must be able to inspire and motivate the workforce. As leaders, entrepreneurs are transformational in nature and are agents of change (Thornberry, 2006 pg. 14). This contrasts management in that managers maintain the balance and steady operation of the business. Managers differ from leaders also in that they must operate within the boundaries of the system i.e., budgets, rules, policies, etc… In contrast to the manager, leaders develop the systems that confine managers. They also seek out new methodologies and new opportunities to expand profits and the enterprise. For example, leaders in organizations will decide to take on a new competency such as carrying a new product and entering a new market. This will require the leader to inspire the workforce towards accepting and embracing the change while at the same time defining the new methodologies for the new competency.
Some of the most successful companies have entrepreneurial leaders and managers. There are many examples of entrepreneurs being both managers and leaders such as Steve Jobs. Jobs was the founder and CEO of Apple computers and his efforts as a manager brought Apple back from financial troubles in the 1990‘s (Steve Jobs, 2012). But Steve Jobs also was an entrepreneurial leader as can be seen in his ability to transform Apple’s core competencies. Jobs was the chief innovator of the iPhone which allowed the company to become involved in the growing telecommunications fields rather than remaining strictly a personal computer company (Murtazin, 2010).
Other examples of the entrepreneur being a manager and leader can be seen in Bill Gates founder and chairman of Microsoft. Gates has been a shrewd manager which at every turn where Microsoft gained a market advantage, he would defend the position aggressively. Using tactics such as creating software that only worked with Microsoft’s operating system and making Microsoft’s operating system reject foreign software (Wallace, 1993 pg. 42).
Gates has also been a leader of change. He has led Microsoft through many alterations in its core competencies. The Windows Phone, tablet technologies, and recently medical computer software. Although he has been accused of being authoritative and even combative, he is still able to lead the thousands of workers at Microsoft through many new innovations (Wallace, 1993 pg. 56).
Through these examples, one can see the necessity for entrepreneurs to have both leadership and managerial skills. A basic understanding of this idea can be seen in the fact that entrepreneurs create the enterprise and its rules and policies. Should a particular rule or policy need to be altered the entrepreneur must be able to perform this task (Thornberry, 2006 pg. 15). Having an understanding of management and as a leader allows this task to be performed. The ability of the entrepreneur to give employees vision and motivation must be combined with the basic functioning of the organization. Without these two vital skills, most endeavors of the entrepreneur would be unsuccessful.
Wallace, J. (1993). Hard Drive: Bill Gates and the Making of the Microsoft Empire. New York: HarperCollins Publishers.
Thornberry, Neal (2006). Lead Like an Entrepreneur (1st ed.). New York, NY: McGraw- Hill. Pg. 14–16
Murtazin, O. (2010). Apple’s phone: From 1980s’ sketches to iphone. part 3. Retrieved from http://mobile-review.com/articles/2010/iphone-history3-en.shtml
Steve Jobs. (2012). In Encyclopædia Britannica. Retrieved from http://www.britannica.com/EBchecked/topic/304313/Steve-Jobs
Triola Vincent. Fri, Jan 08, 2021. Interpersonal & Self-Management Skills for Entrepreneurs Retrieved from https://vincenttriola.com/blogs/ten-years-of-academic-writing/interpersonal-self-management-skills-for-entrepreneurs