Another Guest Posting by Linda Linham:
Cultivating Entrepreneurship in the New Economy
Entrepreneurial energy is transforming Corporate America and will help transform regional economies as well. In an economy where growth and competitive advantage increasingly comes from innovation, entrepreneurship has become more central to the success of regional economies.
With states less able to prosper by attracting businesses from out of state, they increasingly must look within, and expanding entrepreneurship will be a key part of that strategy. Entrepreneurship is important because, even if regions have a strong knowledge infrastructure, it will be difficult to translate that knowledge into growing businesses without entrepreneurial energy. Entrepreneurs, and top executive talent, are the mechanism by which ideas get translated into commercial success.
Being entrepreneurial means charging down a new path, staying alert to opportunity and taking risks to seize the opportunity. It means having energy, vision, optimism and daring to try something new. An entrepreneur is anyone with both an idea and the willingness to take the idea to the marketplace.
In my past travels around corporate America, in tough economic times, I recall the echo of the repeated question: “How do we stimulate more innovation and initiative in our people?” People seem to matter in direct proportion to an awareness of corporate crisis. Today, in every sector, old and new, I hear a renewed recognition of the importance of people, and of the talents and contributions of individuals to a company’s success. As the tension of America’s economy tightens, recognizing the importance of innovation has become a national and regional priority. Entrepreneurs in corporations, in small business, in education, in non-profit organizations and in government will be the drivers of that innovation.
Some studies reveal that higher levels of research and development in a region correlate with higher levels of new firm formation and fast growing firms. Higher levels of education are also an important factor, as regions with a greater proportion of college-educated residents see higher rates of new firm formation.
Since entrepreneurship is driven by individuals who are willing to take risks and are able to execute their plans, making entrepreneurship easy for individuals is important. In order to be effective, entrepreneurship support efforts must be more user-driven, engaging entrepreneurs in peer-to-peer learning and networks, with very case-specific and hands-on learning. From my experience in working with thousands of entrepreneurs, while successful entrepreneurs appear to have particular skills and attitudes, there are usually steps that can be taken to help them become more successful entrepreneurs with expanded entrepreneurial education and training.
In the New Economy, two broad trends are in high gear. These trends can combine in powerful ways to raise our standard of living, create jobs, spur entrepreneurial effort--and do all this without boosting inflation. The first is the globalization of business. Simply put, capitalism is spreading around the world with the introduction of market forces, freer trade, and widespread deregulation. For the U.S., this means international trade and investment play a much greater role in our economic life than before. The second trend is the revolution in information technology-- not just the cell phones, computers, and the Internet--but the digitization of all information--words, pictures, data, and so on that is creating new companies and new industries before our eyes and assisting the shift from industrial and labor capital to intellectual capital. This shift to a new entrepreneurial economy is accelerated by several measures we have implemented in this country that lower obstacles to innovation and increase the potential rewards of entrepreneurship.
With this New Economy, there is also a new business cycle. Housing and autos used to drive the U.S. economy. Now, information technology accounts for a quarter to a third of economic growth. Information technology affects every other industry. It boosts productivity, reduces costs, cuts inventories, and facilitates electronic commerce. Consumer participation in the creation of digital content, such as social networks, interest based affiliations, hobbies, travel destinations and so on, are a fact and are helping drive economic growth. Online retail spending increased 21% over the last year and 16% of total retail sales are directly influenced by the web as consumer’s research products online and purchase them offline. This is projected to expand at a 17% compounded annual growth rate over the next five years, resulting in $1 trillion of US store sales by 2012.
Entrepreneurs play a critical role in developing a healthy economy for Licking County. When the economy is unstable, people turn to entrepreneurship as an avenue for change and decisions on entrepreneurship will be critical to ongoing innovation and economic growth. Entrepreneurship has an additional advantage for regional economies: it tends to “stick,” with local entrepreneurs usually growing their firms in the state in which they live.
As I sat in the town meeting on “Community Capitalism” last week, it was apparent that innovation and an entrepreneurial spirit were alive in Licking County. With an aim to open young people's eyes to the possibility of entrepreneurship, promote entrepreneurship education, raise awareness of entrepreneurship-friendly policies, and find alternative pathways for the commercialization of new knowledge and technologies, how can we miss?
In my transition from the corporate world to that of an entrepreneur, it is obvious to me that I have met the future –I am part of it—in a world of opportunity ready to be explored. Put that in your crystal ball you naysayers of economic gloom and doom.
For more information about this company or this article contact:
Linda@successfulventuresllc.com or visit our blog: www.successfulventuresblog.@blogspot.com