Author: Mital K. M.
Entrepreneurs convert an opportunity through creativity and innovation into a profitable venture by efficiently utilizing existing or new resources. Many big entrepreneurs in world were those who were driven by an untiring passion. A business leader knows individual strengths and passions that drive them and then exploit them in a manner that benefit both employees and the organization. A leader can utilize and retain enterprising individuals in the organization by creating enabling environment where passions can be sustained and thrived.
Business leaders are generally people with indomitable will but who often adopt strategic flexibility in achieving entrepreneurial objectives. Renowned South Indian poet, Saint Tiruvalluvar, said over 2000 years ago, ‘the world is his who accomplishes his job with untiring compassion and zeal, (Karumam Sidhaimal Kannoda Vallarku, Urimal Udaithu Iv Ulagu).
Swami Vivekanand said over hundred years ago, ‘We reap what we sow. We are the makers of our own fate. The wind is blowing, those vessels whose sails are unfurled catch it, and go forward on their way, but those which have their sails furled do not catch the wind. Is that the fault of the wind? We make our own destiny.’
On March 16, 1945, Mahatma Gandhi wrote, ‘There is an eternal struggle going between destiny and human endeavour. Let us continue to endeavour and leave the result to God’. On following day, i.e., March 17, 1945, Gandhiji added, ‘Let us not leave everything to destiny, nor be vain about our endeavour. Destiny will take its own course. We should only see where we can intervene or where it is our duty to do so, whatever be the result.’
Individuals with entrepreneurial skills who pursue social issues like poverty alleviation, drinking water supply, rural sanitation, environmental protection, healthcare, etc. are called ‘social entrepreneurs’. According to Mahatma Gandhi, ‘as soon as a man looks upon himself as a servant of society, earns for its sake, spends for its benefit, then his value system automatically improves and there is ahimsa in his venture’.
A leader always lives and works for a cause beyond self and never hesitant to make supreme sacrifices for its realization. Netaji Subhas Chandra Bose, a great Indian leader and an epitome of bravery and patriotism, a few before his arrest in Kolkata on January 2, 1932 had written to his friend, ‘Do you want the beautiful scent of a rose in full bloom? If so, you must accept the thorns. Do you want to see the bounty of the smiling dawn? If so, you must live through the dark hours of the night. Do you want the joy of freedom? If so, you must pay the price. The price of freedom is suffering and sacrifice.’ It is well known that Netaji never cared for his personal safety while fighting for India's freedom (Archives, Cellular Jail, Port Blair).
According to Pt. Jawaharlal Nehru, free India's first Prime Minister, service in the Indian context means service of teeming millions. The first Prime Minister often called him first servant of India. Mother Teresa was epitome of service and living for others sake. She once said, ‘There are many medicines and cures for all kinds of sickness. However, unless kind hands are given in service and generous hearts are given in love, there cannot be a cure for the terrible sickness of feeling unloved.’
Organizing local entrepreneurs and connecting their outputs to the world markets present some of the most challenging opportunities for social enrichment through corporate intervention. ITC's ‘e-Choupals’, Pepsi's ‘contract farms’ and EID Parry's IT solutions, are examples of large corporations adding value by networking with small-scale producers.
By setting up rural entrepreneurs with internet access and using modern technology to accurately weigh farmers crops and pay them promptly and adequately, ITC's e-Choupal system is transforming India's agricultural supply chain, reducing systemic corruption and giving farmers both better prices for their crops along with self respect and confidence in dealing with their more fortunate brethren.
Like ITC, Pepsi's contract farming provides good framework for flow of credit to marginal/small farmers at a reduced transaction cost. EID Parry in Chennai on the other hand provides local entrepreneurs the technological backing to run Internet kiosks in rural areas. EID Parry has also created its own Internet portal, to support farmers with access to fertilizers and tools, education and crop disease diagnosis, and a direct market for their crops of rice and sugarcane and highlights how a single computer can change the entire village.
As a very large premier bank in India, ICICI Bank provides numerous banking services to the rural poor at affordable costs. In partnership with other financial institutions, ICICI Bank has co-located ATMs with rural Internet kiosks and introduced smart card technology to provide secured low cost transactions and loan management services. The ICICI Bank has, among others, created a network of eight thousand Self Help Groups, each with twenty women to benefit them economically, with a view to provide vehicle for micro-financed businesses.
Involvement of the poor for the corporate growth in ‘enlightened-self interest’ is catching up as a corporate strategy. Local entrepreneurs represent the vital ‘last leg’ of distribution systems which can act as markets at the ‘Bottom of the Pyramid (BOP)’ that may offer valuable products and services. This may serve dual purpose i.e. real value addition to the company and fulfillment of corporate obligations as responsible corporate citizen (C.K. Prahalad -The Fortune at the Bottom of the Pyramid: Eradicating Poverty Through Profits).
Ela Bhatt, Founder-General Secretary of the Self-Employed Women's Association (SEWA) is a true living legend of social entrepreneurship. A confluence of three movements, the labour movement, the cooperative movement, and the women's movement, SEWA and its many subsidiaries including SEWA Bank, a cooperative bank, provide micro-credit facility to rural poor particularly women.
Bank is a cooperative where members save funds and raise loans usually first to redeem debts from private money-lenders and then to acquire assets such as a handcart, a house, a work-shed, a small piece of land, a well, a handloom, a sewing machine, a biogas plant or a cow. These assets improve their family incomes by increasing productivity or adding an additional source of earning and diversifying the resource base. SEWA members make continuous efforts to own added assets and improve productivity.
SEWA Bank experiment proves that women from the informal sector can profitably manage a cooperative bank. When the members own a bank, they take keen interest in its management and ensure a high repayment rate, which creates surpluses and earn them attractive dividends (Ela Bhatt).
In an attempt to provide financial independence and power to the people of India particularly women, Government of India on April 12, 2006 introduced ‘UTI Retirement Benefit Pension Fund’ to the SEWA members through monthly contributions. This was possible with ‘UTI Mutual Fund’ joining hands with ‘Shri Mahila Sewa Sahakari Ltd.’ representing unorganized women workers through the ‘UTI Retirement Benefit Pension Fund’.
Another noted example of ‘social entrepreneurship’ is that of novel experiment of ‘Pani Panchayat’ mooted by Vilasrao Salunkhe, a social entrepreneur in the field of water security in Maharashtra villages. The ‘Pani Panchayat’ philosophy is based on the belief that water belongs to all living beings - people, animals, birds, trees and insects. Its success depends on cooperation and partnership among government agencies, village panchayats, and committed individuals and volunteers.
Traditionally, India's development planning has been at macro level and top down that focused too much attention on big picture such as a big dam or a river linking project. During the period of late Shri Rajiv Gandhi as Prime Minister (1984–89) emphasis was placed on bottom up approach for planning in which local bodies particularly village panchayats would play greater role. This experiment was conceived to meet the menace of drought with people support and panchayats providing part funding.
During water crisis in eighties, Maharashtra faced severe drought when fifty lakh people were on look out for alternative means of occupation as it was not possible to go ahead with agriculture without water. The only alternative source of subsistence which the state administration could think of providing to farmers was stone breaking at a paltry rate of Rs. 2 per day.
It occurred to Vilasrao and a group of innovative farmers struggling to earn livelihood that rural entrepreneurs could instead divert their energies for conserving rainwater which could meet formidable challenge posed by drought. Local authorities particularly the district collector showed keen interest in building structures for water storage and extended all possible support to the farmers for building the local water bodies (Vilasrao).
Spirited rural entrepreneurs spared no efforts in building scores of water storage structures in record two to three months time, and when the rains actually arrived, huge storage capacity was already in place for storing rainwater. Initially, the pilot project was limited to 15 villages, but later on structures were built practically in all regions that were hard hit by the drought. If the experiment is successful in one state, it can be replicated anywhere in the country.
Considering that land was very expensive resource and it was unevenly owned by farmers, for which there was little that authorities could do, it occurred to Vilasrao that if not land at least water could be more rationally allocated among poor farmers on the basis of family size rather than size of landholding. This new basis for water allocation and pioneering leadership of Vilasrao and the District Collector largely contributed for the spectacular success of the ‘Pani Panchayat’ experiment.
An innovative leader builds dynamic work culture, attracts and retains talent, and encourages innovation. Innovation determines the cutting edge of a business. The word innovation comes from the Latin word innovare to renew. Innovative employees can act as ‘business transformation agents’ who bring innovative solutions that can transform the business. It is the leader who himself may not be ‘know it all’ but can make his whole team innovate as innovation is a culture and not one person activity.
Leaders often need to be flexible to ensure that the organization will be able to adapt to change, quickly respond to new threats and opportunities and manage diverse and decentralized operations more efficiently. Flexibility is often described as ability to adjust to changing conditions without losing one's original shape, e.g., a tree can bend with the wind, and then shift upright.
Leaders are drivers of creativity in organizations. Imagination and dreaming are the real drivers of corporate growth. Creativity breeds in an independent mind. Happy minds are seldom creative and some times it is only in crisis that individuals tend to become more creative. Creative individuals often derive insights from obstacles and hurdles they face in their day-to-day life.
Innovation differs from invention though both are creative activities. Invention is a creative event whereas innovation is a creative process. An organization is a place for generating new ideas with a view to create value and then linking these ideas with resources - human, financial, infrastructure and knowledge. With creativity and innovation, organizations can provide ‘value added’ to shareholders and improve business performance, meet social expectations and minimize damage to the environment from their operations and services.
Creativity combined with implementation of creative idea is innovation. That is why Mr. Azim Premji, Wipro Chairman, recently wrote in the Bhavan's Journal (2006) ‘creativity is about thinking new things whereas innovation is about doing new things.’ They are always very sensitive to problems, needs, attitudes, and feelings of others. Creative leaders as also creative individuals are always very flexible to quickly adapt to new developments and changing situations.
According to Mr. Narayan Murthy, Chairman, Infosys Technologies Ltd. (The Economic Times, May 16, 2006), ‘the future is all about how open minded you are to learn from other people. Companies like Infosys that bring innovation in making this collaborative distributed development model become more and more efficient is where the future is. ‘Collaborative distributed development’ in simple words means sourcing capital from where it is cheapest, sourcing talent from where it is best available, producing it is where it is most cost effective, and selling where the markets are.
An organization or institution may have advantage of superior machinery and technology initially, but it may not be enough to maintain competitive advantage all along as with subsequent technological advancements winning advantage will be lost one day. However, if a leader manages to retain its competent and committed workforce who is flexible to meet any challenge through synergy of intellectual potential to revamp technological capabilities while retaining timeless core values, it may provide needed support for survival in the market place against all odds.
India needs to rekindle people's entrepreneurship qualities particularly when it is at threshold of becoming a leading economic power in the globalization era. Government policy such as deregulation and lowering of capital gains tax can provide fillip to entrepreneurship. Business schools can also provide necessary grooming for young minds to turn entrepreneurs. Above all, in organizations it is company leadership that can nurture and sustain entrepreneurship skills of its employees.