We are at the beginning of a new entrepreneurial era, and the benefits for each of us and all of us are magnificent. They’re also numerous and multifaceted, and potentially quite revolutionary. Here is a way to distill them into three meta-virtues.
Entrepreneurs – especially those who follow the principles of Individual Economics – understand that they can’t predict or control the future. The future is defined by uncertainty – we don’t know what is going to happen, irrespective of our own actions. In fact, there is a type of uncertainty identified by Peter G Klein, the leading economist of entrepreneurship, called Absolute Uncertainty. That’s when we have a large set of input options – actions we could take – each of which would generate a large array of possible outcomes. Choosing the inputs and anticipating the outcomes are both uncertain.
Entrepreneurs are individuals who embrace this uncertainty. What exactly does that mean? First, they recognize it as an environmental condition. They know they will never have enough knowledge to resolve the uncertainty. Everything is a possibility, nothing’s a certainty, and most things don’t even have a probability score. Entrepreneurs develop heuristics – decision making short cuts using as much knowledge as possible, but not waiting for certainty. They take action. They think in bets– making as good a bet as possible. If things turn out differently than they prefer, they learn, they re-assess and try another action.
With this pattern of action – assessment – re-assessment – more action, self-reliant individual entrepreneurs can experience a sense of control. The decisions are theirs, the actions are theirs, their attitude to unpredictable events is stable and positive. They choose their own ends, and choose the means they utilize to achieve those ends. They are free to change those means, or to adjust the ends they strive for.
There is no sense of failure, or even possibility of failure. There is a process, an action sequence, a continuous streak of entrepreneurial initiative that generates new knowledge, which, in turn, stimulates new actions. Entrepreneurship is a lifestyle choice.
When we settle for a subsidiary position as an employee in a hierarchical structure, we abase ourselves. We submit to the whims and preferences and rules and assignments and orders of others. We work towards their imagined futures, not our own. When we position ourselves as a node of entrepreneurial service in a network of collaborators and consumers, sharing knowledge, ideas and mutually beneficial service offerings, we elevate ourselves and others. We manage our possibilities by our hard work, our responsiveness to market signals in the network, our ideas and our initiatives.
We are all striving for self-betterment. Entrepreneurship is often described in terms of seizing opportunities. In fact, opportunities do not “exist”. They can only be described in retrospect, when an observer can identify the results of a successful initiative. But the entrepreneur did not know that success would be the outcome. The entrepreneur imagined a possible future, worked hard to attain that future, and made a lot of adjustments along the way. Entrepreneurs create opportunities.
Indeed, creating opportunity is how entrepreneurs navigate uncertainty. The route to success is paved by the needs of others. Every person’s need is raw material and a source of energy for the entrepreneur. Every free market exchange occurs between a willing buyer and an eager entrepreneurial seller. It is because consumer needs always exist that entrepreneurs will always be able to create opportunity.
When entrepreneurs look for possibilities, they are seeking ways to serve others. An expression of need or dissatisfaction with the current state of things by a consumer is a request to make things better. By offering to serve the consumer, to solve their problem and make their life better, the entrepreneur is creating a just and moral society of dynamic opportunity. The creative entrepreneurial society is directed towards betterment for all. In a society characterized by entrepreneurial order, there is no drive for redistribution, and no negotiation for a bigger slice of the pie among entrenched special interests or classes. There is only mutual betterment. The entrepreneur succeeds if the consumer feels better.
Entrepreneurship, therefore, is the most fulfilling life. It consists entirely of understanding what others want and need, and creating products and services to address those wants and needs. And then observing the results. Success? Then do more good. Not quite what the consumer wanted? Then readjust and try again for their approval. Move closer and closer towards the goal of perfect service for your fellow human beings.
Everyone of us has a hierarchy of needs. When we feel good about what we have attained at one level, we can move up to the next, and tackle something greater – a higher value. The entrepreneur can take the consumer on that journey to higher and higher values. It’s a collaborative climb to the top.
The New Mantra Of Entrepreneurship.
In the past, the life mantra communicated to us by parents and teachers has been something like this: “Get educated, then earn a salary by working for a company and climbing the corporate ladder over time.” The new mantra can be something different: “Know yourself, establish your uniqueness, then create value by serving your chosen customers in better and better ways.” You will have control over your life, create opportunity and find fulfillment.