There are only two types of senior executive leaders in the business world: professional managers and entrepreneurs.
That’s a bold statement, to be sure, but it’s true.
Every successful leader shares a set of common traits. They are decisive opportunists who possess an ironclad stomach and understand how to take calculated risks while mitigating the downside. They listen, adapt and learn from failure. They are able to forge and foster long-term business relationships. They are persuasive and can sway a single individual’s opinion or plant the seeds needed to create groupthink. And they are closers, really good closers.
But the similarities end there.
“Entrepreneurs are passionate about what they do,” says Steve Howe, Americas area managing partner, Ernst & Young LLP. “They wake up every morning, flying out of bed, looking to make a difference.”
“They’re dedicated,” says Maria Pinelli, strategic growth markets leader, Ernst & Young LLP. “They have perseverance, ingenuity. They have the ability to take risks. And failure is not seen as something that is devastating. They just dust themselves off, pick themselves up and continue on to try to make the world a better place.”
So on one side, you have professional managers, who are akin to corporate mercenaries. No, not in the sense that they’re hired to literally take out the competition vis-À-vis Michael Corleone. But rather in a more figurative sense in that they’re hired to capture market share, increase revenue and, yes, crush the competition.
Professional managers command top dollar and their job is to do one thing — get results. Typically, professional managers are recruited to do one of the following: engineer a turnaround, push or pull an organization over a hurdle and take it to the next level of growth, break an extended period of stagnation, transform a company culture, take a company public, spearhead and/or integrate an acquisition, clean up the books or get a company ready for a sale, or keep the C-suite warm for a fixed period of time while the board or owners methodically undertake a long-term CEO search.
When you think of professional managers, people such as James McNerney (3M), Stephen Bennett (Intuit) and Matthew Espe (IKON) immediately come to mind. That’s a pretty good dinner party if you could pull it off.
Entrepreneurs, however, are that other breed.
“Entrepreneurs thrive on innovation and change,” says Debra von Storch, partner, Ernst & Young LLP, and director, Southwest Area — North Entrepreneur Of The Year program. “Thus, they are wired to succeed in our highly connected and fast-changing world. For them, it’s about finding the opportunities in the big picture. They willingly adapt and innovate to keep up with, and even get ahead of, the changes in the market.”
Also, they’re customer-focused first and dedicated to building relationships.
“Entrepreneurs think about their customers,” Howe says. “They’re constantly asking themselves, ‘What does our customer need? How can I serve them better?’ If your company is aligned with the customer, you’ll have a better chance at success.”
By their very nature, entrepreneurs have a need to create something out of nothing. They’re committed to filling a gap in the marketplace that they’ve identified or are driven to revolutionize an industry. And just as important, they recognize how to innovate in ways few thought were possible.
“They understand that innovation isn’t only found in products and services,” Pinelli says. “Entrepreneurs apply innovation to their own business processes to make them leaner, meaner and more competitive.”
With these passions and goals, it should come as no surprise that entrepreneurs are spearheading the economic recovery, much as they’ve done after other downturns.
“Their role in the economic recovery is absolutely critical,” Pinelli says. “Seventy percent of new jobs are created by companies aged five years or less. They are so vital to the economy. They are also focused on future market opportunities. They’re interested in mergers and acquisitions. They’re committed to creating new products and services. And they’re acquiring talent, which means new jobs.”
Among this group, women entrepreneurs are a fast-growing segment.
“The untapped potential for this economy and the global recession lies with women entrepreneurs,” says Beth Brooke, global vice chair — public policy, sustainability and stakeholder engagement for Ernst & Young LLP. “The power of diversity is driving economic growth.”
Some entrepreneurs are satisfied being lifestyle entrepreneurs who have built businesses that allow them to live a certain level of lifestyle that they’re satisfied with maintaining. But most entrepreneurs are serial entrepreneurs. They are the ones who have that proverbial fire in their bellies to take an idea through the complete business life cycle — from idea to business development to growth, and then a cash-out event (sale of company, IPO) — before starting the cycle anew.
“You need to be thinking about where you want to be in 10, 20 years, rather than just thinking about today or tomorrow,” Howe says. “Entrepreneurs have a unique way of looking at their businesses this way.”
