First Thoughts After Day One

his is not a report on the event. It is a record of my thoughts based on the presentations, conversations with delegates, other thoughts I have been having lately, the interviews I have been doing for the Sages of Strategic Management, other books I have read recently, and discussions with other people too numerous to mention over the last weeks and months.

The Entrepreneurial Society is the theme of the Forum, It comes from Drucker's book Innovation and Entrepreneurship (1985), in which he perceived the move from an employee society towards an entrepreneurial society, a transformational change resulting in the rapid proliferation of free agents in the form of contractors, freelancers, and self-employed workers. Charles Handy referred to them as the Fleas in his book, The Elephant and the Flea (2002), where the elephants are the large corporations.

This change, as with most changes, offered both opportunities and risks - and still does as the trend continues to play out. But, as Handy has pointed out in subsequent books, the risks have become all too real for the majority, whilst the benefits have been conferred on the few. Rising inequality is one place to look for evidence of this.

Among the losers are those on zero-hour and minimal hour contracts that wish to be in regular full-time employment, often forced to take several part-time positions to try and make a living, with few employee benefits, less security and no guarantee of any pension provision.

Many of these people might also find themselves to be unwilling entrepreneurs, the option forced on them for lack of better alternatives. And many would not regard themselves as entrepreneurs at all. This was the position my late father found himself in having been made redundant during the 90's recession, from a job he had held for decades. I think the stress and the strain may well have contributed to his premature death.

Thinking about this forced me to wonder, just how many entrepreneurs in The Entrepreneurial Economy really are entrepreneurs? There are also other reasons for asking this question. When we talk about entrepreneurs people like Richard Branson (Virgin), Elon Musk (Tesla) or Jeff Bezos (Amazon) might spring to mind. Or we might think of people behind Uber or Airbnb. In reality, entrepreneurs with this profile are a tiny percentage. In fact of all those that might regard themselves as entrepreneurs, it is said that only seven per cent are fast growth businesses (the Gazelles as they are called).

In addition, speaking yesterday, Gary Hamel reminded the audience that the world has only 170 Unicorns. No, he has not gone mad. This is the term to describe a start-up company valued at over $1 billion. (Canadian tech unicorns are known as narwhals. A decacorn is a word used for those companies over $10 billion, while hectocorn is the appropriate term for such a company valued over $100 billion).

In making these comments I am not saying that The Entrepreneurial Society trend is not happening. What I am saying is that it is probably not as big, or fast growing, as we think, or at least not in the way we might be thinking of it. And Gary Hamel also offered evidence of this, saying that in the US, the country with the most Unicorns, they only account for two per cent of GDP.

Nor am I saying we shouldn't encourage the development of The Entrepreneurial Society - all successful businesses started out as new enterprises established by entrepreneurs at some point. But I think we should not lump all entrepreneurs into one category - they vary in many ways, not least in ambition. And, we might want to reflect on the kind of entrepreneurial society we want to have, that is desirable.

My conclusion at the end of day one is, we might want to focus on creating an entrepreneurial society in which being an entrepreneur is a choice, rather than the result of necessity. And, we won't create what we want if we continue to think of entrepreneurs as a homogenous group. They vary considerably and need to be supported and encouraged in different ways.

This leads me to my other thought, that we need to regard The Entrepreneurial Society as a complex ecosystem with many agents. If we then map the system we will get a better understanding of who the key players are, what the key processes, where the obstacles and blind spots may be, and what changes are required.

How complex is it? Well, consider the number of types of entrepreneurs, investors, lenders, business models, ownership models, stakeholder groups etc. The complexity becomes clear immediately.

To map and understand this may help us think about and design the kind of Entrepreneurial Society we want, and where to focus our attention. And I argue that the current lack of understanding has led to an entrepreneurial society that is full of insecurity, anxiety, fear and desperation. A situation that gives rise to great dissatisfaction, providing fuel to power the growing wave of populist backlashes seen in the UK (Brexit Vote), the US (election of Trump), and in other European Countries (the rise of the far right parties).

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I would like to thank Harvard Business Review for sponsoring my attendance at the Drucker Forum this year.

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Paul Barnett, Founder & CEO Strategic Management Forum Founder & CEO of The SMB Partnership Founder of Business Hard Talk, and Co-Founder of BE Advisory