Entrepreneurial Spirit? Or something else?
There is no doubt the way we work is changing. Hiring is becoming a more conduluted process, companies are chopping departments to stay ”lean”, and from our side, the desire to have our values reflected in our professional life are becoming stronger. In some ways the tumultuous, ever progressing business world allows for these changes. But in others, centuries of rigid corporate structures or a desire to churn out quick profits limits their impact, or even makes them take a turn for the worse. So how to overcome these barriers? The answer for some; businesses and individuals alike, is to make their own rules.
Which begs the question. Are people really deciding to take the radical entrepreneurial path by themselves, or is this movement simply coming from victims of circumstance.
Why the Hiring Process is Taking Longer Than Ever
For those about to hire a new employee, don’t expect to be getting anywhere soon. According to a study done by Glassdoor based on a sample of 344,250 interview reviews, the average time it takes to fill a position from the interview is close to 23 days. The most alarming thing is that this rate has increased by 13 days in four years. This is due to a number of factors — increase in background checks, internal bureaucracy, increasing number of interview stages, adding layers to candidate reviews and the approval process.
More Job Seekers. Fewer Jobs.
It’s becoming increasingly difficult to get a job. Fact. College graduates are struggling to break into the workforce, whilst recent economic downturns and skeleton staffing for a “lean business model” have challenged the once implicit loyalty between employees and employers. This difficulty exists for many reasons. A steady decline in HR staffing levels means that for some companies two or three HR people are expected to handle the employee recruitment, training, benefits and compensation for several hundred team members. There’s also an inherent bias towards unemployed job seekers with recruiters and HR teams even vocalising their preference to hire someone already unemployed rather than take somebody from the market without a job.
Fewer jobs and more job seekers. Not an easy problem to solve.
Employees are also feeling more unsteady in their position, especially when approaching retirement age. With these two factors combined, it’s no wonder people are seeking alternatives, if only to grasp the potential of a stable future.
Who Are the Real Players In The Startup World
This influx of new businesses could easily be attributed to young college graduates who couldn’t get their foot in the door, job seekers, or those approaching retirement age fearing their job is unstable. It could also be attributed to those who don’t like the way regular businesses conduct themselves and are seeking alternatives. Is it optimistic to say it is those who are genuinely passionate about their ideas and possess the “entrepreneurial spirit”? The question is difficult to verify.
When you ask an Entrepreneur why they started their business you’re likely to get an answer consisting of changing the world and building new ideas. Those less enthusiastic will talk of preference of an independent lifestyle, autonomy, the chance to innovate. There might be a few smatterings of “I was unhappy in my career and wanted something more”. It’s a rare person who will tell you “I couldn’t find a job so I created my own one”.
That’s not to say all the above aren’t valid reasons. According to the GoForthInstitute for those who want more out of their careers Entrepreneurship was the number one choice. The trend is particularly evident amongst younger people, with one third of Canadians expressing a preference for an independent work lifestyle. They want control over what, when and how they work.
Autonomy comes at a price and entrepreneurship, though holding the potential to award high profits, is challenging and a long term project. Deciding your own hours is not so appealing when you’re working 16 hours a day. Young startups face uncertain markets, unproven technology and difficulty overcoming external factors such as access to finance, international agreements and consumer power. The growth rate of small businesses is low, and their survival rate not much greater.
Would these visionary entrepreneurs rather have the same individuality, control over their work conditions and ability to make valuable contributions within a stable company? Quite possibly. And if that’s the case this points to entrepreneurship being a situational spin off from a lack of businesses failing to keep up with modern working expectations, meaning companies are missing out on some of the most creative, dedicated human resources in their vicinity.
Start-Ups are just one example of people displaying their inner entrepreneur and being their own boss. Joining the “freelance economy” as an independent consultant awards the same freedom, flexibility, time management and autonomy to work with whom and on what you want without the heavy investment of starting a company. Though it’s not completely obstacle free, with independent consultants being in charge of their own client acquisition, client management and chasing up client debt ( see results to 2PS independent consultants). Consultants can therefore suffer from varying paychecks and not billing for a significant portion of the hours they are working. Despite this an MBO/emergency survey said that 45% of independent workers reported making more money than they would’ve normally in a traditional role, predicting the number of independent workers to grow to almost 28 million by 2020.
Big Businesses Taking on the Entrepreneurial Spirit to Cut Costs.
Companies have caught onto the perks of hiring an independent consultant as opposed to recruiting extra employees. Large corporations such as Bell have discovered just how economically viable independent consultants can be. Beginning at first as a way to keep on old expertise of employees who want a more casual workload in retirement, the technique soon developed into a way of reducing hiring costs while chopping and changing the expertise they needed, ultimately developing it into a way of introducing enlightenment in the office and even as a mentorship program.
Lack of innovation kills. Differentiate or Die in the “Gig Economy”.
We’ve all seen the big brands who have died because they were either unable to, or refused to embrace the impending change. Kodak, BlackBerry, Blockbuster, all company giants who lost everything because of an unwillingness or inability to innovate. Kodak, a company once worth $31 billion, had to file for bankruptcy in 2012, a direct result of a failure to recognise the consumers taste changing from film to digital. Likewise, Blackberry failed to respond in time to the invention of the smartphone. As a result they are now barely hanging on to 3% of market share. And Blockbuster — well it’s not entirely sure if they ever had a chance.
Is the hiring process going the same way? Company employees directly impact the productivity, brand image and overall profit of a company. As employees shift jobs more often and the hiring process becomes more conduluted, there could be sense in asking if there’s a danger towards continuing down the old pathways of acquiring human recourses.
So how does one capture that entrepreneurial spark and keep it for your own company, preventing pouring money into an employee who wants to take your training and jump ship.
One option is to make your business inviting. Give all the benefits entrepreneurs desire and create an environment where innovation is encouraged and ideas taken seriously. This can include flexible working hours, company benefits, superior payment and healthcare packages, regular training etc.
A second is to look outside the corporate structure and hire expertise from freelancers or independent consultants. These experts are familiar with many brands and are achieving great results for businesses. But more importantly, they live and breath innovation.
Perhaps as companies adapt we will see less entrepreneurship amongst individuals, and more amongst companies.
Only time will tell if the entrepreneurship spirit is really built on passion and not situational factors, but as human nature is never made up of one component, it’s my guess it’s a little bit of both.
Are entrepreneurs in it for the lifestyle, the passion or because they lack alternatives. Could big companies utilize these individuals better? Tell us what you think!