Entrepreneurial business analysis practitioner
Richard Larson, CBAP, PMI-PBA, PMP
Elizabeth Larson, CBAP, CSM, PMI-PBA, PMP
Co-Principals, Watermark Learning
Given both authors are entrepreneurs and have done extensive business analysis work, it seems logical for us to write about this topic. But, why bother? What possibly could be relevant about entrepreneurialism for a business analyst or project manager? For starters, entrepreneurship is an increasingly attractive career option within an organization and as a start-up, and is more and more viable with each passing year. Even if we are not interested in forming a start-up, the principles of entrepreneurship are becoming increasingly important for organizations to innovate and stay competitive.
In this paper, we will explore several aspects of entrepreneurs and intrapreneurs and what it means for business analysis. Our firm belief is that by adopting a more entrepreneurial way of working, practitioners will be more effective and organizations will benefit.
Part 1: What do Business Analysis and Entrepreneurship Have in Common?
If we do business analysis work, we may be wondering about career options. Everyone thinks about his or her career options, but the authors tend to hear about career concerns from business analysts more than anyone else. Should we aspire to be project managers? That used to be the most common next step, but many business analysts (BAs) today prefer not to go that route. Another related question for those of us who already are project managers and perform business analysis as part of our job is, what is a feasible and attractive next career step?? What about becoming business architects? That would be a logical move for “logical” people since architects tend to be abstract thinkers and focused on the “big picture.”
We feel that product-oriented roles are the most conducive for using business analysis skills to help an organization grow. Both product management and business analysis roles take advantage of business knowledge and/or business analysis skills to define, refine, and steer development of new products.
Designing and developing new products is what entrepreneurs do. There is more to being an entrepreneur, which we explore below. A critical part of starting a business or line of business is creating a new product or service or one that is better than the market currently has. That is often what business analysts and project managers do.
First, let us define entrepreneur since there are many definitions floating around. Translating from the French, entrepreneurs “undertake a venture” which involves some risk. A longer and more precise definition from Investopedia is the following:
“An individual who, rather than working as an employee, runs a small business and assumes all the risk and reward of a given business venture, idea, or good or service offered for sale. The entrepreneur is commonly seen as a business leader and innovator of new ideas and business processes” (Investopedia, 2015a).
Entrepreneurs have been around for quite a while, with the first usage of the term dating to the early 1700s. Classic examples of technology entrepreneurs are Steve Jobs and Mark Zuckerberg. Coco Chanel was a fashion and perfume innovator and entrepreneur in the 20th century. Levi Strauss sewed his first pair of blue jeans in the 1850s and created the Levi's Jeans Company. James Watt was an 18th century entrepreneur who did not invent the steam engine, but innovated several important improvements to it. Watt is far better remembered than Thomas Savery, who is usually credited with the invention. Entrepreneurs are more frequently innovators than they are inventors.
If we do entrepreneurial work inside an organization, the common term for us is “intrapreneur.” Both authors have been intrapreneurs in their careers and like the concept of people in organizations starting up ventures to launch new products and services. Here is the Investopedia definition of intrapreneur:
An inside entrepreneur, or an entrepreneur within a large firm, who uses entrepreneurial skills without incurring the risks associated with those activities. Intrapreneurs are usually employees within a company who are assigned a special idea or project, and are instructed to develop the project like an entrepreneur would. (Investopedia, 2015b)
One issue we have with this definition is that is says, “without risks.” The authors believe one is not entrepreneurial if there is no risk involved. Although not the same as for entrepreneurs, there are still risks with doing intrapreneurial work. An example may clarify the point.
Intrapreneurial Example 1
The authors’ first exposure to being intrapreneurs came at the bank that we both worked at early in our careers. We functioned as internal management consultants, which is similar to what we now call business analysis work, although that term had not yet been applied to such work. No matter what we were called, we were definitely change agents for the bank, reviewing department processes, procedures, systems and technical requirements, and organizational structures. We recommended not only improvements to processes, but also new products and services, both manual and automated. It was creative and rewarding.
We were both happy as employees, and yet looking back, we were expected to be intrapreneurs in the sense that we helped the bank innovate and move to new possibilities. We “disrupted” the status quo (to use the popular term in lean start-up circles), and that disruption sometimes came at some organization risk and (to us, at least) personal risk. Management thought the organization risk was worth it because it helped the bank achieve better customer service, efficiency, and control. We took on the personal risk because we earnestly believed our recommendations were helping the organization.
Now that we have some definitions in place, let's move on to comparing business analysis and entrepreneurship.
Product versus Project versus Process
Years ago our company published a concept we called the “productivity triangle.” Any organization is productive when they create or provide products or services that customers want and need. Creating them is done through projects, and project management is required for success in that area, naturally. Re-creating the new product on an ongoing basis is done through processes, which need to be improved or optimized periodically. Process management is central to that area and projects may need launching to do the improvement.
Underlying both of these disciplines is product management. The closest parallels of product management to business analysis are the initial requirements and design of new products and services. Another huge part of product management is developing business cases, which BAs often do at companies. Over time, additional requirements surface and new features are added and can be anywhere from small pieces to large releases. Product management both drives and supports projects and processes, completing the productivity triangle. See Exhibit 1.
Business Analysis and Entrepreneurship
So, what does all this have to do with business analysis and entrepreneurship? If we view business analysis work as largely product management, business analysis skills can be readily used in creating new products for a start-up. Similarly, new product development within an organization can be done in an entrepreneurial way, and business analysis skills are critical. Speaking from experience, formal project management is helpful, but not as crucial for a start-up. (Scrum methods are more helpful, but that is a separate topic.) Managing processes is the least important for a start-up, since it won't have processes to manage until it starts to “re-create” the products it has built. The other two legs of the triangle are essential for growing a company. Product management skills—using business analysis skills—are essential for creating a product or a company.
“Product management skills—using business analysis skills—are essential for creating a product or a company.”
Part 2: Entrepreneurial Traits of Business Analysis Practitioners
Assuming that business analysis has much in common with entrepreneurship, what specific traits do entrepreneurs have that are similar to people who do business analysis? While researching this topic, we assembled an extensive list. Since there are so many traits in common between business analysis and entrepreneurship, a table is the best way to properly summarize them. See Exhibit 2, which contains portions adapted from The Reluctant Entrepreneur by Michael Masterson (2013).
What has always fascinated us about business analysis is the ability to change organizations for the better by contributing to new and effective solutions. People performing business analysis work tend to like and often love change, which is also a general entrepreneurial trait. Doing business analysis work contributes to positive change in organizations and entrepreneurial work operates much the same way.
The skills and qualities in the right-hand column will serve us well in a variety of settings. It applies equally to those of us who are happy being project managers and business analysts, as well as to those of us who want to use the skills internally in organizations or who want to strike out on our own as entrepreneurs.
Conclusion. If we are business analysis practitioners and adept at solving problems, we are in good shape to affect positive and innovative change in our organizations. We are also a potential intrapreneur or entrepreneur. As entrepreneur, Warren Brown, puts it, “One thing I find myself doing a lot is problem solving. And I think entrepreneurs show their mettle with creative solutions to problems” (Brown, 2011).
Part 3: How Intrapreneurs Drive Innovation
But, what if you don't think you are an entrepreneur? Most people are not going to start a company or build a business from the ground up. We may not want to risk our livelihoods or work crazy hours or wear multiple hats like all successful entrepreneurs do. Think again.
Today's business world is quickly changing. With all the emphasis on innovation, our organizations need us to be entrepreneurial. Maybe not be an actual entrepreneur, but our organization's success and our career will increasingly depend on how you can help our organizations adapt and grow and compete. Competition has always been part of business, but it seems to be getting more intense and dynamic. To illustrate this point, the average lifespan of a company on the Standard & Poor's 500 list was 67 years, back in the 1920s. Today the average length is only 15 years (Kalb, 2013).
Perhaps the best way for most BAs to become entrepreneurial is by being an intrapreneur. Earlier, we cited a definition of that term and mentioned there is one part of this definition we don't like: it is hard to be entrepreneurial without incurring risks. So, we would add to this definition that intrapreneurs indirectly assume risks on behalf of the organization. There might be financial risk if the new products and services we create lose money. There are product risks if the changes we instigate have defects. Additionally, intrapreneurs take personal risks within the organization, which could materialize if the products or services we work on don't succeed.
Intrapreneurial Example #2.
One of the authors, Richard, put it this way: “I had the good fortune of being asked to start up and lead the training division of the IT consulting company I worked for back in the 1980s. It was a new division, and the company owners were busy running the consulting operation, so they gave me a great deal of latitude. I treated the job as a “business within a business” and worked at it like it was my own. That attitude, I now realize, is an important ingredient to success as an intrapreneur. For example, I provided all the training at first, as well as marketing, sales, and administrative work. The ability and interest in wearing multiple hats is another key to intrapreneurial success. I certainly made many mistakes and all of my on-the-job learning taught me a great deal about intrapreneurship during my seven years doing it. In particular, I was not as successful at the people aspects of this intrapreneur story. I had trouble influencing some of the other managers to provide me the training resources I needed as this new division grew.”
Why are intrapreneurs important for innovation?
When organizations introduce new products or enhance existing ones, our guess is that today, they would all say they want to “innovate.” The intrapreneurial function is the most practical and repeatable way to implement many innovations. However, to think about “innovation” as being a uniform process is overly simplistic. In the article, “The Innovation Strategy Big Companies Should Pursue,” Tony Davila lists four types of innovations, depending on whether they are top-down or bottom-up and the extent to which they are “breakthroughs” or incremental (Davila, 2014):
- Incremental: Continuous Progress and Emergent Improvements
- Breakthroughs: Strategic Bets and Strategic Discoveries.
We have summarized these four types in Exhibit 3. It is common to associate innovation with breakthroughs; given how often Apple and 3M are used as examples. At Apple, some of Steve Jobs’ major successes, like the iPad and iPhone, were strategic bets. The Post-It Note product from 3M is an example of a strategic discovery type of innovation.
It is important to also include incremental change as innovation, since there are many more opportunities to accomplish this type in today's workplace. Given there are more opportunities; most potential intrapreneurs are apt to work on incremental innovations in their career. The particular type of innovation possible is also highly dependent on the organization's culture. Armed with this knowledge, potential intrapreneurs can work within the organizational culture and have better success by employing innovation processes that are compatible with the culture.
Davila also notes that organizations today are least likely to have processes in place for “Strategic Discoveries” (Davila, 2014). To address this point, we assembled a table with thoughts about how business analysis practitioners can best contribute to the various innovation types (see Exhibit 4).
Will my Company Support This?
A writer on intrapreneurship, Dan Schawbel, has written an insightful article on this topic. He maintains that, “Smart companies want you to become an intrapreneur because it fuels business growth and allows them to gain a competitive advantage in their industry” (Schawbel, 2013). We couldn't agree more and, at the same time, realize this may seem a daunting proposition. Many companies are not structured today to foster intrapreneurship, yet there are indications that organizations are moving in the right direction.
In the same article, Schawbel describes a recent study in conjunction with American Express that found that “58% of managers are either very willing or extremely willing to support employees…on a new business opportunity within their company” (Schawbel, 2013). That sounds like fertile ground for intrapreneurship. Chances are, many companies would agree and support moving into such a role.
Part 4: Example of Entrepreneurial Business Analysis in Action
To illustrate how business analysis skills translate into entrepreneurial and intrapreneurial action, consider this example.
Clorox Anywhere - Mary Jo Cook and Susanne Sengelmann
Mary Jo Cook and Suzanne Sengelmann are two product managers at Clorox and passionate intrapreneurs. They are also working moms who like clean houses, but were concerned about the effects that typical cleaning chemicals had on the environment.
Their passion about this issue led them, over time, to a solution that would help others who cared about the same issue. They helped create a new product line called Clorox Anywhere, which uses new technology that kills most germs, but is safe to use around kids and pets. These two intrapreneurs are not scientists. The work they do is similar to business analysis. However, the normal predictive approach to new products at Clorox had not produced any major new brands for 20 years at Clorox. How did they accomplish this new venture at their large organization?
Cook and Sengelmann had a strong personal desire to have an effective cleaning agent that was environmentally safe and friendly. They started to experiment at home on their own time (Schlesinger, Kiefer, & Brown, 2012). They had no budget or mandate, so they collaborated with other working mom “volunteer” colleagues, including one in R&D who had already been experimenting with environmentally friendly formulas. Collaboration, an important business analysis skill, is also crucial to entrepreneurs, particularly those who implement new products.
Their work eventually caught the attention of the new ventures group at Clorox, and they were given permission to work on it as part of their job. They did it informally, in a way that did not require sign-offs, which may have been a key part of their success. Had they gone through normal channels, their effort may not have succeeded, due to potential conflicts with those having a vested interest in the status quo.
For instance, there were many fears internally that a “green” product line would hurt the company's reputation for effectiveness. There were other worries that it would not be profitable. There were valid concerns that the new non-chemical product would draw negative attention to Clorox's other products that use harsh chemicals. Given these barriers, the non-traditional way of nurturing the new product line was essential, which is an important lesson for intrapreneurs.
After some initial failures, the team kept experimenting and testing, until they finally found a formula that was effective and 99% free of harmful chemicals. Because the product concept was so new, the team skipped traditional market analysis and business planning that risked killing the fledgling line. They brought in another “volunteer” team member, a marketing specialist and working mom, to test prototype products with consumers. They continued to use their modest budget to do testing and continued doing informal reporting to keep management informed.
They learned that consumers liked the concept and it did not detract from their views of Clorox's other products. Using prototypes to do testing and research is another crucial intrapreneurial technique, as it is with business analysis. With enough evidence, Cook and Sengelmann were finally able to make some market predictions and to get management backing to launch the product line. Combined with some strategic grass roots marketing, the brand quickly grew to US$60+ million in revenues.
Summary. Intrapreneurs can help create innovative new products by taking small steps, learning from them and adapting, and by using minimal budgets and informal business plans. As the authors of the article note, “This anecdotal evidence suggests that the act-learn-build strategy can and should be espoused not only by entrepreneurs but also by employees working within traditional organizations” (Schlesinger, et al., 2012).
Part 5: Keys to Entrepreneurial Success
There are many factors that contribute to being a successful entrepreneur or intrapreneur. Here are the three main keys to success we have discovered across industries and types of “preneurs.”
Inspiration, Passion, and Commitment
The order is purposeful. Inspiration comes from a need you can solve, which is the trigger for any venture. We bring up Passion second, since it would be a mistake to chase a passion without the inspiration of a viable opportunity. Commitment is third, since it sustains us through the hard work of making it happen, as the Clorox example illustrated.
Sometimes we call inspiration “thinking outside the box.” In other cases, inspiration comes from frustration with the status quo.
Not all new product ideas are innovative. Nor is innovation creating a carbon copy of products already available. Innovation requires creating a better product, as illustrated by the story of Liz Lange Clothing (Lange, 2011).
For example. Liz Lange is an entrepreneur who worked at Vogue magazine and was frustrated by the dowdy look of women's maternity clothes. As a working mother herself, she thought there was a better way. She did not invent maternity clothes, but created a fashionable maternity clothes business from scratch, designing them herself out of a one-room office in 1997. She was not afraid to look to others for ideas, and even used Vera Wang wedding dresses for inspiration.
That is a key point for entrepreneurs and intrapreneurs: we do not have to be inventors. A key skill to employ is benchmarking the competition or even tangential products. Then, innovation happens when we add a new feature or function, such as making them fashionable as Liz Lange did. After 10 years growing her company, Liz sold it for several million dollars and her designs are now the exclusive maternity clothes sold through Target Stores.
The second key to success as an entrepreneur or intrapreneur is passion for what we are doing. We need to love what we are doing and have a strong desire to solve a problem. This passion is needed to take the risk in the first place and face the risk of failure as the two product managers demonstrated in the Clorox example. We also need to love our venture in order to keep pursuing it and make it succeed. Entrepreneurial passion does not mean blind devotion or stubborn pursuit of a goal, since we may need to alter the product being built. Sometimes, it may mean abandoning a venture if success is impossible. It is similar to a relationship that adapts and develops over time.
For example. Warren Brown is a passionate entrepreneur and the founder and owner of CakeLove (www.cakelove.com) and Love Café in the Washington, DC area of the United States. He has a bachelor's degree in history, a master's degree in public health, and a law degree. None of his degrees were typical preparation for an entrepreneur.
While working as a lawyer, he had a passion for his baking hobby, which he did not have for his law career. While on a flight to visit family one weekend, he baked a cake and carried it in his lap. The reaction of everyone to his cake—by the flight attendants, security guards, and fellow passengers—gave him the inspiration to start a new business.
As he waited at the airport for a family member to arrive, he said, “I just stared into space thinking about what just happened. Why was everyone so excited? After a few moments, I realized that I was staring right at my future: scratch-made cakes. Its strong appeal meant potential. Right then and there, I decided that I would start a cake business” (Brown, 2011). Warren's story illustrates both inspiration and passion, and how both were strong motivators to start and devote himself to his venture. He has since expanded his business into selling pies, writing books, and appearing on television.
The final ingredient for entrepreneurial success is to stay committed to any venture we start. Entrepreneurial commitment involves taking a project or product or other venture we may feel passionate about and turning it into reality. Commitment is made up of Competence (in the venture), Confidence (about one's chances for success), Courage (to taker the inherent risks), and Cognizance (of one's limitations, but also of one's motivations).
For example. Craig's List is good example of commitment. Craig Newmark founded the company in 1995 by sending an email list of activities to his friends in the San Francisco, California area. The list became popular and moved to the web, growing to include “for sale” items, job postings, services, and almost anything you can think of. Today, they receive over 80 million posts from 70+ countries a month. And they have fewer than 20 employees to accomplish all that.
Craig's List exemplifies commitment because the company knows their mission and focuses on it, as opposed to generating revenue or market share. He says that, “The…community has grown exponentially…but our philosophy about how we run it hasn't changed at all” (Newmark, 2011). Their philosophy is an important one for entrepreneurs. Newmark, who even gave up the CEO reins a while back says of their mission: “It's about people, and people connecting with each other in their day-to-day lives” (Newmark, 2011).
To help them focus on that mission, they purposefully keep the site overly simple (which explains the plain nature of it). In addition, they could focus on generating more revenue, but their dedication to their mission and the value they place on trust is far more important to them. It is not to say that making money is bad, but a) determining one's entrepreneurial mission; and b) committing oneself to it is important to success.
In summary, it is quite possible for people practicing business analysis and project management to become entrepreneurs or intrapreneurs based on the many examples cited above. If you have some of the traits and skills mentioned earlier and think the keys to success make sense, then here are some final calls to action to consider. To make it practical, remember to “PACE” ourselves.
P – Be Prepared, build expertise, and look for inspiration and opportunities. Seek out mentors and potential sponsors.
A – Analyze opportunities as they arise to determine their viability. Remember that passion alone isn't enough; we must do our homework and plan our venture.
C – Develop a business case and Commit to the opportunity. We need to be courageous, and take the plunge.
E - Evaluate the venture. We need to ensure it is on the right track and adjust as necessary.
The authors feel that many business analysis and project management practitioners we have met possess all the traits needed to be successful “preneurs.” We are in a prime position to establish new business units and products at our current organization, as well as launch new businesses. What are we waiting for? It's time to go out and “preneur!”
Brown, W. (2011). Emotions in entrepreneurship. In Sellers, R. (Ed.), Creating a business you'll love – Top entrepreneurs share their secrets (pp. 61–70). South Portland, ME: Sellers Publishing.
Davila, T. (2014, June 5). The innovation strategy big companies should pursue. Harvard Business Review. Retrieved from https://hbr.org/2014/06/the-innovation-strategy-big-companies-should-pursue/
Entrepreneur. (2015, May 25). In Investopedia. Retrieved from http://www.investopedia.com/terms/e/entrepreneur.asp
Intrapreneur. (2015, May 25), In Investopedia. Retrieved from http://www.investopedia.com/terms/i/intrapreneur.asp
Kalb, I. (2013, June 8). Innovation isn't just about brainstorming new ideas. Business Insider. Retrieved from http://www.businessinsider.com/innovate-or-die-a-mantra-for-every-business-2013-7.
Lange, L. (2011). How passion, persistence, and purpose led to profits. In Sellers, R. (Ed.), Creating a business you'll love – Top entrepreneurs share their secrets (pp. 127–138). South Portland, ME: Sellers Publishing.
Masterson, M. (2012). The reluctant entrepreneur: Turning dreams into profits. Hoboken, NJ: John Wiley and Sons.
Newmark, C. (2011). Why Craigslist works. In Sellers, R. (Ed.), Creating a business you'll love – Top entrepreneurs share their secrets (pp. 39–44). South Portland, ME: Sellers Publishing.
Schawbel, Dan. (2013, September 9). Why companies want you to become an intrapreneur. Forbes Magazine. Retrieved from http://www.forbes.com/sites/danschawbel/2013/09/09/why-companies-want-you-to-become-an-intrapreneur/.
Schlesinger, L. A., Kiefer, C. F., & Brown, P. B. (2012, March). New project? Don't analyze—Act. Harvard Business Review Retrieved from https://hbr.org/2012/03/new-project-dont-analyze-act.
© 2015, Richard Larson and Elizabeth Larson
Originally published as a part of the 2015 PMI Global Congress Proceedings – Orlando, Florida, USA