1. MS3024 New Venture Creation Week 7 From Entrepreneur to Leader 8: From Entrepreneur to Leader Entrepreneurship and Small Business

2. You start the business as a dream, you make it your passion for a while, and then you get experienced managers to run it because it’s not as much fun as starting. Stelios Haji-Ioannou

3. 8: From Entrepreneur to Leader Entrepreneurship and Small Business Stage Growth Models Size Large Small Young Age Mature STAGE 1STAGE 2STAGE 3STAGE 4STAGE 5

4. 8: From Entrepreneur to Leader Entrepreneurship and Small Business Existence Size Large Small Young Age Mature STAGE 1STAGE 2STAGE 3STAGE 4STAGE 5 Spiders-web Informal Direct supervision Opportunity driven Stage Growth Models

5. The Spider’s Web 8: From Entrepreneur to Leader Entrepreneurship and Small Business

6. Large Small Young Age Mature STAGE 1STAGE 2STAGE 3STAGE 4STAGE 5 ExistenceSurvival Spiders-web Informal Direct supervision Opportunity driven Spiders-web Informal Supervised supervision Generate repeat sales Stage Growth Models Size

7. The Spider’s Web 8: From Entrepreneur to Leader Entrepreneurship and Small Business

8. Stage Growth Models Large Small Young Age Mature STAGE 1STAGE 2STAGE 3STAGE 4STAGE 5 ExistenceSurvival Spiders-web Informal Direct supervision Opportunity driven Spiders-web Informal Supervised supervision Generate repeat sales Relationship based management Basic systems Some formality Maintain status-quo Success Disengagement Size

9. 8: From Entrepreneur to Leader Entrepreneurship and Small Business Stage Growth Models Large Small Young Age Mature STAGE 1STAGE 2STAGE 3STAGE 4STAGE 5 ExistenceSurvivalSuccess Growth Spiders-web Informal Direct supervision Opportunity driven Spiders-web Informal Supervised supervision Generate repeat sales Improving systems Increasing formality Strategy Obtain resources for growth Relationship based management Size

10. 8: From Entrepreneur to Leader Entrepreneurship and Small Business Stage Growth Models Large Small Young Age Mature STAGE 1STAGE 2STAGE 3STAGE 4STAGE 5 ExistenceSurvivalSuccess Growth Spiders-web Informal Direct supervision Opportunity driven Spiders-web Informal Supervised supervision Generate repeat sales Improving systems Increasing formality Strategy Obtain resources for growth Take-off Strategy Systems & controls Delegation Decentralisation Increasing formalityRelationship based management Size

11. 8: From Entrepreneur to Leader Entrepreneurship and Small Business Young Age Mature STAGE 1STAGE 2STAGE 3STAGE 4STAGE 5 Stage Growth Models Large Small Big company Professional Systems & controls Return on investment ExistenceSurvivalSuccess Growth Spiders-web Informal Direct supervision Opportunity driven Spiders-web Informal Supervised supervision Generate repeat sales Improving systems Increasing formality Strategy Obtain resources for growth Take-off Strategy Systems & controls Delegation Decentralisation Maturity Increasing formalityRelationship based management Size

12. Big Company Hierarchical Structure 8: From Entrepreneur to Leader Entrepreneurship and Small Business

13. Big Company Matrix Structure 8: From Entrepreneur to Leader Entrepreneurship and Small Business

14. Size Large Small Young Age Mature STAGE 1STAGE 2STAGE 3STAGE 4STAGE 5 Evolution stages Revolution stages Greiner’s Five Stage Growth Model

15. 8: From Entrepreneur to Leader Entrepreneurship and Small Business Size Large Small Young Age Mature STAGE 1STAGE 2STAGE 3STAGE 4STAGE 5 Crisis of: 1: Leadership 1: Creativity Evolution stages Revolution stages Greiner’s Five Stage Growth Model Growth through:

16. 8: From Entrepreneur to Leader Entrepreneurship and Small Business Size Large Small Young Age Mature STAGE 1STAGE 2STAGE 3STAGE 4STAGE 5 Crisis of: 1: Leadership 2: Autonomy 1: Creativity 2: Direction Growth through: Evolution stages Revolution stages Greiner’s Five Stage Growth Model

17. 8: From Entrepreneur to Leader Entrepreneurship and Small Business STAGE 2STAGE 3STAGE 4STAGE 5 1: Creativity Size Large Small Young Age Mature STAGE 1 Crisis of: 1: Leadership 2: Autonomy 3: Control 2: Direction 3: Delegation Growth through: Evolution stages Revolution stages Greiner’s Five Stage Growth Model

18. 8: From Entrepreneur to Leader Entrepreneurship and Small Business Crisis of: Growth through: Size Large Small Young Age Mature STAGE 1STAGE 2STAGE 3STAGE 4STAGE 5 1: Leadership 2: Autonomy 3: Control 4: Red Tape 1: Creativity 2: Direction 3: Delegation 4: Co-ordination Evolution stages Revolution stages Greiner’s Five Stage Growth Model

19. 8: From Entrepreneur to Leader Entrepreneurship and Small Business Growth through: Size Large Small Young Age Mature STAGE 1STAGE 2STAGE 3STAGE 4STAGE 5 Crisis of: 1: Leadership 2: Autonomy 3: Control 4: Red Tape 5: ? 1: Creativity 2: Direction 3: Delegation 4: Co-ordination 5: Collaboration Evolution stages Revolution stages Greiner’s Five Stage Growth Model

20. The Growth Process 8: From Entrepreneur to Leader Entrepreneurship and Small Business GROWTH CRISIS CONSOLIDATION

21. 8: From Entrepreneur to Leader Entrepreneurship and Small Business Effectiveness High Low Short Time Long STAGE 1STAGE 2STAGE 3 Getting used to the new circumstances Immobilisation Change and Effectiveness Relearning Becoming effective Denial Depression Letting go Testing new reality Putting it together CHANGE EVENT

22. The Leader’s Job Having vision and ideas Long-term, strategic planning Communication: Internal and External Creating the culture by example Monitoring and controlling performance 8: From Entrepreneur to Leader Entrepreneurship and Small Business

23. Vision A shared mental image of a desired future state: Provides a sense of meaning and purpose Inspirational Aspirational Motivating But must be realistic, credible and attractive Often includes core values 8: From Entrepreneur to Leader Entrepreneurship and Small Business

24. The Mission Statement The (business) aims to use its (competitive advantage) to achieve/maintain (aspirations) in providing (product scope) which offers (benefits) to satisfy the (needs) of (customer scope). In doing this the company will at all times strive to uphold (values). Wickham 8: From Entrepreneur to Leader Entrepreneurship and Small Business

25. Kotter’s Seven Principles 1.Keep it simple 2.Use metaphors, analogies and examples 3.Use many different forums 4.Repeat the message 5.Lead by example 6.Address small inconsistencies 7.Listen and be listened to 8: From Entrepreneur to Leader Entrepreneurship and Small Business

26. Values, Vision, Strategy and Tactics 8: From Entrepreneur to Leader Entrepreneurship and Small Business Enduring Long-term Changing Short-term VALUESVISIONTACTICSSTRATEGY

27. Constructing Culture 8: From Entrepreneur to Leader Entrepreneurship and Small Business CULTURE Cognitive processes Ethics, values, beliefs attitudes, etc. Norms & rules of conduct Behaviours How things are actually done Vocabulary organizational processes Leadership styles Structures Empowerment Controls & rewards Routines, rituals etc. Stories, symbols & myths Values

28. Dimensions of Entrepreneurial Culture Clarity of goals, tasks, procedures etc. Expectation of high standards Commitment to organizational goals Feeling of personal responsibility towards these goals Feeling of recognition & reward for high performance Sense of cohesion & team working Timmons 8: From Entrepreneur to Leader Entrepreneurship and Small Business

29. The Contingency Theory of Management 8: From Entrepreneur to Leader Entrepreneurship and Small Business Situation Task Group Leader

30. The Contingency Theory of Management 8: From Entrepreneur to Leader Entrepreneurship and Small Business Situation Task Group Leader

31. Leadership Styles 8: From Entrepreneur to Leader Entrepreneurship and Small Business High Low Group autonomy in decision- making ParticipativeConsultative PaternalisticAutocratic Leader’s Authority LowHigh

32. The Contingency Theory of Management 8: From Entrepreneur to Leader Entrepreneurship and Small Business Situation Task Group Leader

33. The Leadership Grid 8: From Entrepreneur to Leader Entrepreneurship and Small Business High Low Concern for People Poor Management Firm but Fair Team Management Country Club Task Management Concern for Task HighLow

34. The Contingency Theory of Management 8: From Entrepreneur to Leader Entrepreneurship and Small Business Situation Task Group Leader

35. Thomas-Kilmann Conflict Modes 8: From Entrepreneur to Leader Entrepreneurship and Small Business Compromising Accommodating Collaborating Competing Avoiding Assertiveness Cooperativeness High Low High

36. The Contingency Theory of Management 8: From Entrepreneur to Leader Entrepreneurship and Small Business Situation Task Group Leader

37. 8: From Entrepreneur to Leader Entrepreneurship and Small Business The Belbin Team Role Model Shaper Plant Co-ordinator Resource Investigator Monitor-Evaluator Team-Worker Implementor Completer-Finisher Specialist

38. 8: From Entrepreneur to Leader Entrepreneurship and Small Business Usually the self-elected task leader - dynamic, outgoing, highly strung, argumentative, a pressuriser, seeks ways around obstacles Allowable weakness: Tendency to bully, not always likeable Examples: Tony Blair, Margaret Thatcher, Bill Gates The Shaper

39. 8: From Entrepreneur to Leader Entrepreneurship and Small Business The Plant The team's vital spark and chief source of ideas – creative, imaginative, unorthodox Allowable weakness: Bit of a handful and/or head in the clouds Examples: Prince Charles, Edward de Bono, Lisa SimpsonEdward de Bono

40. 8: From Entrepreneur to Leader Entrepreneurship and Small Business Team's natural chairman & enabler - mature, confident, talks easily, listens well, clarifies goals, promotes decision-making - not always the team-leader but has quiet charisma Allowable weakness: A touch manipulative The Co-ordinator Examples: Obi Wan Kenobi, Steve McClarenSteve McClaren

41. 8: From Entrepreneur to Leader Entrepreneurship and Small Business Essentially a fixer - extrovert, amiable, six phones on the go, a wealth of contacts - and an explorer of opportunities – the typical entrepreneur Allowable weakness: Undisciplined and/or a short attention span The Resource Investigator Examples: Anita Roddick, Richard Branson, Peter Mandelson, 'Del Boy’Peter Mandelson

42. 8: From Entrepreneur to Leader Entrepreneurship and Small Business The Monitor-Evaluator Team's rock - strategic, sober, introvert, discerning, capable of deep analysis of huge quantities of data - rarely wrong – often second in command Allowable weakness: An unexciting plod Examples: William HagueWilliam Hague, Walin Smithers (Mr Burns’ assistant)

43. 8: From Entrepreneur to Leader Entrepreneurship and Small Business The Team-Worker A counsellor-conciliator - mildly social, perceptive, accommodating, aware of undercurrents and others' problems, and promotes harmony - most valuable at times of crisis Allowable weakness: Indecisive Examples: Gary LinekerGary Lineker, Marg Simpson

44. 8: From Entrepreneur to Leader Entrepreneurship and Small Business The Implementer The team's workhorse - turns ideas into practical actions and gets on with them logically and loyally - disciplined, reliable, conservative Allowable weakness: Can only adapt if told precisely why Examples: The Queen, James Dyson, Clive SinclairJames Dyson

45. 8: From Entrepreneur to Leader Entrepreneurship and Small Business The Completer-Finisher The team's ‘worryguts’ - a stickler for detail, deadlines and schedules, and has relentless follow-through - chief catcher of errors and omissions – another good second in command Allowable weakness: Can't let go Examples: Any civil servant

46. 8: From Entrepreneur to Leader Entrepreneurship and Small Business The Specialist The team's chief source of rare knowledge and skill - a single-minded loner, self-starting, dedicated, and makes the occasional dazzling breakthrough Allowable weakness: Contributes on a narrow front Examples: Trevor BaylisTrevor Baylis, Geoff Boycott

47. 8: From Entrepreneur to Leader Entrepreneurship and Small Business The Belbin Team Role Model Shaper Plant Co-ordinator Resource Investigator Monitor-Evaluator Team-Worker Implementor Completer-Finisher Specialist

48. 8: From Entrepreneur to Leader Entrepreneurship and Small Business Team-Development Wheel 0 STAGE FOUR STAGE THREESTAGE TWO STAGE ONE TESTING Polite Impersonal Watchful Guarded 39 6 4 5 8 7 2 111 10

49. 8: From Entrepreneur to Leader Entrepreneurship and Small Business STAGE FOUR STAGE THREESTAGE TWO STAGE ONE 0 TESTING Polite Impersonal Watchful Guarded INFIGHTING Controlling conflicts Confronting people Opting out Difficulties Feeling stuck 39 6 4 5 8 7 2 111 10 Team-Development Wheel

50. 8: From Entrepreneur to Leader Entrepreneurship and Small Business STAGE FOUR STAGE THREESTAGE TWO STAGE ONE 0 TESTING Polite Impersonal Watchful Guarded GETTING ORGANISED Developing skills Establishing procedures Giving feedback Confronting issues INFIGHTING Controlling conflicts Confronting people Opting out Difficulties Feeling stuck 39 6 4 5 8 7 2 111 10 Team-Development Wheel

51. 8: From Entrepreneur to Leader Entrepreneurship and Small Business STAGE FOUR STAGE THREESTAGE TWO STAGE ONE 0 MATURE CLOSENESS Resourceful Flexible Open Effective Close and Supportive TESTING Polite Impersonal Watchful Guarded GETTING ORGANISED Developing skills Establishing procedures Giving feedback Confronting issues INFIGHTING Controlling conflicts Confronting people Opting out Difficulties Feeling stuck 39 6 4 5 8 7 2 111 10 Team-Development Wheel

52. The Role of the Board of Directors 8: From Entrepreneur to Leader Entrepreneurship and Small Business Provide accountability Monitoring & supervision Strategy formulation Policy-making Past & present orientation Outward looking Inward looking Future orientation

53. MS3024 New Venture Creation Week 7 From Entrepreneur to Leader - continued 8: From Entrepreneur to Leader Entrepreneurship and Small Business

54. From yesterday Growth is the goal of new businesses Growth is problematic as it produces crises and/revolution before growth and evolution For the entrepreneur/founder one ongoing issue is how to control the business Management – Or Leadership? 8: From Entrepreneur to Leader Entrepreneurship and Small Business

55. Growth through: Size Large Small Young Age Mature STAGE 1STAGE 2STAGE 3STAGE 4STAGE 5 Crisis of: 1: Leadership 2: Autonomy 3: Control 4: Red Tape 5: ? 1: Creativity 2: Direction 3: Delegation 4: Co-ordination 5: Collaboration Evolution stages Revolution stages Greiner’s Five Stage Growth Model

56. Leadership Defined Leadership is a process whereby an individual influences a group of individuals to achieve a common goal.

57. Components Central to the Phenomenon of Leadership Is a process Involves influence Occurs within a group context Involves goal attainment Leadership Leaders  Are not above followers  Are not better than followers  Rather, an interactive relationship with followers

58. The process definition of Leadership: Leadership is a property or set of properties possessed in varying degrees by different people (Jago, 1982). – Observed in leadership behaviors – Can be learned LEADER Leadership (Interaction) FOLLOWERS

59. Assigned vs. Emergent Leadership Leadership based on occupying a position within an organisation – Team leaders – Plant managers – Department headsDepartment heads – Directors An individual perceived by others as the most influential member of a group or organisation regardless of the individual’s title – Emerges over time through communication behaviors Verbal involvement Being informed Seek other’s opinions Being firm but not rigid Assigned Emergent The entrepreneur James Dyson James Dyson

60. Leadership & Power The capacity or potential to influence. – Ability to affect others’ beliefs, attitudes & actions Referent Expert Legitimate – Trevor Baylis Trevor Baylis Reward Coercive Power Bases of Social Power French & Raven (1959) Bases of Social Power French & Raven (1959) Power is a relational concern for both leaders and followers.

61. Leadership & Power Five Bases of Power

62. Leadership & Power Power is influence derived from being seen as likable & knowledgeable – Referent – Expert Position Power Personal Power Power derived from office or rank in an organisation – Legitimate – Reward – Coercive Types and Bases of Power

63. Leadership & Management Kotter (1990) Management Activities Leadership Activities “Produces order and consistency” Planning & Budgeting Organizing & Staffing Controlling & Problem Solving “Produces change and movement” Establishing direction Aligning people Motivating / Inspiring Major activities of management & leadership are played out differently; BUT, both are essential for an organisation to prosper.

64. Leadership & Management Kotter (1990)

65. Leadership & Management Zaleznik (1977) Managers Unidirectional Authority Leaders Multidirectional Influence Are reactive Prefer to work with people on problem solving Low emotional involvement Are emotionally active & involved Shape ideas over responding to them Act to expand available options Change the way people think about what is possible

66. Entrepreneurial Leadership Skills Visionary Communicator Influencer Motivator Strategist Change manager Conflict resolver Confidence builder Team working Relationship builder Trust generator Delegator Builder of cohesion Clarifier of ambiguity Firm but fair Flexible but consistent

67. Exceptional leaders Providing a clear focus on key issues and concerns, on the right things Getting everyone to understand this focus through effective communication practices Acting consistently overtime to develop trust Demonstrating through actions that they care for and respects the organisation’s members Creating ‘empowering opportunities’ that make individuals believe the right thing for the organisation is their priority Can we say is there a relationship between the entrepreneurial leader and business growth?

68. The Leader’s Role Management is doing things right; leadership is doing the right things. Peter F. Drucker Don't tell people how to do things, tell them what to do and let them surprise you with their results. George S. Patton Delegating work works, provided the one delegating works, too. Robert Half The very essence of leadership is that you have to have vision. You can't blow an uncertain trumpet. Theodore M. Hesburgh