Page 151 - ENTREPRENEURSHIP Innovation and entrepreneurship

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144 THE PRACTICE OF ENTREPRENEURSHIP

likewise best started by discussing the “adult,” the existing business
and the policies, practices and problems that are pertinent in manag-
ing it for entrepreneurship.
Today’s businesses, especially the large ones, simply will not sur-
vive in this period of rapid change and innovation unless they acquire
entrepreneurial competence. In this respect the late twentieth century
is totally different from the last great entrepreneurial period in eco-
nomic history, the fifty or sixty years that came to an end with the out-
break of World War I. There were not many big businesses around in
those years, and not even many middle-sized ones. Today, it is not
only in the self-interest of the many existing big businesses to learn
to manage themselves for entrepreneurship; they have a social
responsibility to do so. In sharp contrast to the situation a century
ago, rapid destruction of the existing businesses—especially the big
ones—by innovation, the “creative destruction” by the innovator, in
Joseph Schumpeter’s famous phrase, poses a genuine social threat
today to employment, to financial stability, to social order, and to
governmental responsibility.
Existing businesses will need to change, and change greatly in any
event. Within twenty-five years (see Chapter 7) every industrially
developed non-Communist country will see the blue-collar labor
force engaged in manufacturing shrink to one-third of what it is now,
while manufacturing output should go up three- or four-fold—a
development that will parallel the development in agriculture in the
industrialized non-Communist countries during the twenty-five years
following World War II. In order to impart stability and leadership in
a transition of this magnitude, existing businesses will have to learn
how to survive, indeed, how to propser. And that they can only do if
they learn to be successful entrepreneurs.
In many cases, the entrepreneurship needed can only come from
existing businesses. Some of the giants of today may well not survive
the next twenty-five years. But we now know that the medium-sized
business is particularly well positioned to be a successful entrepre-
neur and innovator, provided only that it organize itself for entrepre-
neurial management. It is the existing business—and the fair-sized
rather than the small one—that has the best capability for entrepre-
neurial leadership. It has the necessary resources, especially the
human resources. It has already acquired managerial competence and
built a management team. It has both the opportunity and the respon-
sibility for effective entrepreneurial management.