by Steven Brandt
“The future, in business,” writes Steven Brandt, “will go to established companies of all shapes and sizes as well—the ones that adapt.”
Entrepreneuring In Established Companies was written to help leaders enable their companies to be more than change tolerant, to be change agents. To do so, leaders and their companies must help people to interact usefully with the environment. “The environment (not the workers in the environment) is the primary source of mistakes.” 40
About the author:
Steven C. Brandt (1936-2019) was a successful entrepreneur (micro-computer software, bio-chemistry, teaching machines, athletic shoes, abalone farming and new media applications at destination resorts) who also was the Senior Lecturer in Management at the Stanford University Graduate School of Business where he taught for 21 years. You can read more about his fascinating life by clicking here.
The book in a sentence (or two):
“The emphasis in this book is on getting a substantial percentage of all the members of the company thinking innovation on a daily basis so that business as usual is subject to experimentation and change.” 37
My quick take on Entrepreneuring In Established Companies
Having heard Steven Brandt and read his book, my friend Stu Levey passed this book my way. I am VERY GLAD he did. Stu, who served on the Board of Trustees at Lancaster Bible College (LBC), saw parallels between LBC’s organizational dynamics and many of the themes in this book. Brandt’s insights helped me to better understand our times, acknowledge resistance to change, and provided much wisdom as we continue to forge a path toward the future. As a 91-year-old institution, LBC is that “established company.” Brandt is helping me (and LBC) develop more of that entrepreneuring expertise.
Overview and Analysis:
This book is divided into two parts. Part One is designed to help the reader understand and develop a framework as to “why managers and executives do what they do.” In Part Two, the reader is encouraged to consider “what it takes to retain or regain productive, entrepreneurial behavior” in his/her business enterprise.
Brandt uses the analogy of a football team whose members are not merely capable of rearranging themselves in T-formation and other configurations for different plays but who, at the sound of a whistle, are equally capable of reassembling themselves as a soccer, baseball, or basketball squad, depending upon the game being played. Such organizational players need to be trained for instant adoption, and they must feel comfortable in a wider repertoire of available organizational structures and roles. 29
However, the balance between planning — which reduces the need for effective reaction – and structural flexibility – which increases the capacity for effective reaction – needs to shift towards the latter as Rosabeth Kantor points out in The Change Masters.
My Takeaways:
Planning: Planning is probably the best single ritual in a company for stimulating change... for making people more responsive to change... for helping people, “members” of the company, to welcome change. No other ritual--budgeting, performance appraisal, and so forth--has so much up-side potential for actuating entrepreneurship in all facets of company life. 34
As to Strategic Planning: Brandt note that planning has always been a management tool aimed at minimizing surprises, but many die “drawer deaths” (love that descriptor) because they are “too intricate for practical execution by ordinary mortals.” Turbulence and complexity (what the Covey Company calls “the whirlwind”) has a way of taking down the best plans. To counter overcomplexity the author advocates “concentrating all available resources on accomplishing two or three specific, operational objectives within a given time period.” 131 At LBC we seek to do that through the use of Will Mancini’s Horizon Storyline.
Surprise planning is a young cousin of strategic planning. Entrepreneuring includes preparation in the event of surprise emergencies.
Keep information lines open and clear. “Confidentiality is the enemy of trust” says David K. Hurst in “Of Boxes, Bubbles, and Effective Management.” HBR, (May-June 1984)
Managing by consent: Commitment is most freely given when the members of an enterprise play a part in defining the purposes and plans of the entity. Commitment carries with it a de facto approval of and support for the management. Management by consent is a useful managing philosophy if more entrepreneurial behavior is desired.” 54
The key to ideation: The author notes that people in companies with a reputation for innovation and creativity “promote essentially unrestricted communication between people in different functions.” He continues:
Why does fluidity promote entrepreneurial behavior and lead to ideas? The growing knowledge base on how the human brain works seems to indicate that new ideas come from the novel connection of heretofore unconnected pieces of information. This means that if and when energy can flow freely through the circuitry of the brain, the probability of new connections (hence, original ideas) goes up. Empirically, management has appreciated this fact for years. Brainstorming and other approaches to creative thinking all rely in part on being open, uncritical, wild, off the wall, spontaneous. Two-time Nobel Prize winner Dr. Linus Pauling said, “The best way to get good ideas is to have lots of ideas.”
Question: How is our organization facilitating open communication and the free-flow of ideas generally and in and through brainstorming sessions?
“In” or “With”: In his chapter, “Resizing,” Steven Brandt made the following note about how people identify with their company: “Today people tend to be ‘in’ finance, marketing, sales, accounting, manufacturing, personnel, and so forth before they identify whom they are ‘with’.” I thought that was an astute observation and important for the both the leader’s listening ear, and as a focus of emphasis, “with” before “in” or at least “with” and “in.”
Flying High: I’m a visual learner so I appreciated this graphic:
While the entire description was helpful, what the author said about gravity hit home: “Everyone, including members of the managerial corps, has their own gravity to overcome.” In the margin of the book I wrote, “What’s your gravity to overcome?” This is an important question, the answer of which will go a long way to improving personal and organizational effectiveness. See “TNS: The Next Step” 140-144
Team exercises: See pages 98, 101, and 118 for helpful exercises to (1) discern organizational culture, (2) formulate helpful “rules of conduct” for teams for their business and teams, and (3) assessing the value your organization brings to the world.
As to highly functioning teams, “The key to a functioning harmonious group, however, has been for members to understand that they might disagree with each other because they are in two different contexts.” (Hurst, Of Boxes . . ., 175 in Entrepreneuring). This is wisdom and a challenge we have worked to overcome at LBC as “different sides of the house” see from different perspectives resulting from two different contexts.
Cheerleading for the Professional: Truett Cathy’s words, “How do you know someone needs encouragement? If they are breathing” are a great “Amen!” to Brandt’s chapter “Cheerleading for the Professional.” He identifies five regular opportunities to consciously cheerlead: (1) Our choice of words, (2) Our use of time, (3) How we conduct our meetings, (4) How we affirm our values, (5) How we affirm in company rituals.
On innovation: Brandt notes, “To be competitive in the world marketplace requires managing practices that tap deeper into, rather than screen out, the human factor in corporate life. Innovations come only from people.” 125
Innovating means managing surprises. Surprises means less time to gather “all the facts.”
Brandt notes, “the point is that 90 percent of the facts and a timely decision is better than 100 percent and a stale decision, i.e. one too late to do any good.” 133
The leader’s habits: The perceptive leader is the one who at least considers the effects of his or her habits and the behavior they may induce. 115
On improving MBWA: The principles a walker should include:
Curiosity … about what is really going on?
Mental vigor ... for taking on whatever the future holds.
Interest … in those who must make things happen.
Community… we’re all in the effort together.
Results … we’re playing to win. 135
Frederick Herzberg’s definitions of motivators (Brandt’s interpretation):
Achievement (what you believe you did).
Recognition (what others think you did).
Work itself (what you really do).
Responsibility (what you help others do).
Advancement (what you think you can do).
Growth (what you believe you might do).
Brandt’s 10 Commandments for Managing a Young Growing Business:
Limit the number of primary participants to people who can consciously agree upon and contribute directly to that which the enterprise is to accomplish, for whom, by when.
Define the business of the enterprise in terms of what is to be bought, precisely by whom, and why. Know your customers and their needs.
Concentrate all available resources on accomplishing two or three specific, operational objectives within a given time period.
Prepare and work from a written plan that delineates who in the total organization is to do what, by when.
Employ key people with proven records of success at doing what it is the enterprise requires done.
Reward individual performance that exceeds agreed upon standards.
Expand methodically from a profitable base toward a balanced business. Optimism is both the poison and the antidote of the growth company manager.
Project, monitor, and conserve cash and credit capability. Cash flow is the blood of a growth business. A company's ability to continue is determined daily, not at year end; by the contents of the checking account rather than the financial statement.
Maintain a detached point of view.
Anticipate incessant external change by continuously testing adopted business plans for their consistency with the realities of the world marketplace. The problems of the times are the opportunities of the times. Despair is of little value. Vigilance is.
The author piqued my curiosity about these books:
In his chapter, “managing by consent,” Brandt highlights a number of books from his era that speak to “the people factor.” Art of Japanese Management (Richard Pascale), Theory Z (Bill Ouchi), Search for Excellence (Tom Peters), The Change Masters (Rosabeth Kanter)
Words to ponder:
The reality of change: Change is disruptive (anxiety producing) when it is done to you. It can be exhilarating when it is done by you. 34
Change: There exists in human nature a strong propensity to depreciate the advantages and to magnify the evils of present times.... the winds and waves are always on the side of the ablest navigator. Edward Gibbon. 20
Resistance to change: We unknowingly resist in 1000 ways the reorientation in our thinking necessary to move our enterprises into alignment with reality. Viii It is, once again, natural to deny reality when it is strange. 6
Leading change: There is nothing more difficult to take in hand, more perilous to conduct, than to take a lead in the introduction of a new order of things, because the innovation has for enemies all those who have done well under the old condition and lukewarm defenders in those who may do well under the new. Machiavelli, The Prince. 7
What is brave? It is easy to be brave from a distance. Aesop. 7
Esprit de corps: “Union is strength.” 45
The business conundrum in a changing society: “No amount of sophistication is going to allay the fact that all your knowledge is about the past and all your decisions are about the future.” Ian E. Wilson of Sri International. 46
Feedback is the breakfast of champions. Blanchard and Johnson, One Minute Manager.
Ennui: A mental state of zero. 56
Ideation: The best way to get good ideas is to have lots of ideas. Dr. Linus Pauling, two-time Nobel Prizewinner. 65
Listening to your downline: “in the huddle, I would sometimes let the lineman suggest plays... because they were closer to the action than the head coach pacing up and down the sidelines.” Legendary Viking quarterback, Fran Tarkington – From “Fran Tarkenton, Corporate Quarterback,” Fortune, January 21, 1985, p. 118.
About being in a rut: One good thing about being in a rut is that it’s hard to get lost. Jack Steele, Former Dean of the Business School, University of Southern California. 88
Open communication: One distinguishing characteristic of successful, emerging companies is that everyone seems to know what is going on. 81 “Confidentiality is the enemy of trust.” 132
Recommendation:
Brandt wrote, “This book is not about trying to make every corporate citizen into a swashbuckling, table-pounding, internal genius who will sell his or her mother to get to a positive cash flow. It is about revisiting and revising those managing practices that inhibit today's staffing from giving all they can and will give to make their chosen enterprise a winner in its league, given all the new rules that have gone and are going into effect.” 72
And for a book written forty years ago, the author still delivers on that intention.
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Entrepreneuring In Established Companies, by Steven C. Brandt
Homewood, IL: Dow Jones-Irwin, 1986 (252 pages)
