The words “entrepreneurship” and “vision” are frequently bandied around in tandem. The general implication is that both encapsulate the ability to make a difference, to innovate, to spot what others cannot within a business setting.
This gives rise to a question that has long been debated in the world of enterprise education: is this ability, this “vision”, something innate or something that can be developed? In other words, is entrepreneurship fundamentally a question of “nature” or “nurture”?
The point is especially important when one factors in the related issue of whether successful entrepreneurship is sometimes simply a matter of luck. Is an entrepreneurial outlook an inherent gift bestowed only upon a fortunate few? Might it actually be better to be lucky than good?
The answers perhaps become a little clearer if we repackage all of the above into an alternative question: why do some entrepreneurs have only a single notable success and lots of failures while others succeed again and again? It is by getting to the bottom of this vital and revealing distinction, I believe, that we edge much closer to the truth.
We all know there are many entrepreneurs who have enjoyed a major success but cannot manage to repeat it; and we know, too, that there are others seemingly possessed of a “magic touch” – those who somehow get it right again and again. Let us call the former “one-hit wonders” and the latter “serial achievers”. Would it be fair to say that the members of either camp are in any way lucky?
It may be tempting, at least at first, to think of the serial achievers as uncommonly blessed by fortune. After all, they are the ones who never come up short. They are the ones who prevail again and again. They are the ones who must have the “gift”.
In reality, though, it is the one-hit wonders who are more likely to have had luck on their side – usually because they were in the right place at the right time. This, you see, is very often how some entrepreneurs get lucky once; and it is also why they never get lucky again. Fortune smiles on them, and that is that. They will succeed again only if fortune smiles on them again.
If we recognise that anyone in the game can be lucky once then there must be something else behind the track records of the serial achievers who create wealth on a consistent basis, maybe even in different industries. What is their secret – if, indeed, it is a secret at all?
Of course, any entrepreneur with a conspicuous success story to his or her credit will find it easier to attract both human and financial capital second time around. Yet this cannot be the explanation we are looking for, because such is the case for one-hit wonders as well.
What about the aforementioned “vision”? Vision is wonderful for motivation and for inspiring others, but it changes as a business evolves and learns. There are lots of business ideas that are interesting, yet they are of strictly limited value in the absence of effective execution.
And it is here that the answer surely lies. Serial achievers succeed again and again not because of luck – far from it – but because of the skills and experience they bring to bear and the processes they apply. What sets the multi-hit wonders apart from their one-hit counterparts is a particular ability to solve problems, articulate propositions, frame prospects, minimise risk and maximise opportunities.
Curiously, it is skills such as these that routinely go unremarked or misunderstood. They are habitually hailed as part of the mysterious “gift” with which certain individuals are supposedly imbued.
This view is both seriously misguided and potentially damaging. It might just be conceivable that some entrepreneurs are born with extremely useful attributes, but it by no means follows that others cannot possibly acquire them later in life.
These are skills, remember; and skills can be taught. At Nottingham University Business School we have been involved in various studies and collaborations that demonstrate how would-be entrepreneurs of all kinds, from students to the owners of small businesses to the managers of multinational corporations, can be trained to develop the sort of innovative mindset and problem-solving discipline liable to foster repeated success.
Nassim Nicholas Taleb once observed that to understand why some people succeed it is essential to analyse why others fail. He noted: “Some traits that seem to explain millionaires, like appetite for risk, only appear because one does not study bankruptcies.” To put it another way: we need to contemplate the many bad-luck stories that are out there before we place undue focus on the somewhat lesser number of good-luck stories.
We might usefully reflect on the analogy of a lottery player who scoops a jackpot and promptly writes a book about how he came up with the winning numbers. Some readers may regard him as tremendously clever – and few would doubt his success – but the fact is that lottery wins are down to chance and involve no talent whatsoever.
Similarly, there is an unhealthy tendency – sometimes even in the sphere of enterprise education – to idolise “rock star” CEOs when greater scrutiny of the macro picture would show that many of these people, on balance, just happened to get lucky for once in their lives. Bully for them. Although there is doubtless much to be gleaned from their experiences, we should be very careful to ensure that the lessons we learn are the right ones.
Ultimately, there is nothing wrong with luck. Moreover, there is nothing wrong with celebrating it. But in teaching the entrepreneurs of the future we should acknowledge it for what it is and, crucially, present it for what it is; and, above all, we should make absolutely clear that it is better to be good than lucky.
David Falzani is an Honorary Professor at Nottingham University Business School’s Haydn Green Institute for Innovation and Entrepreneurship.