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The Alchemy of Leadership Blog

Entrepreneurs vs Corporate Types

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I come across many types of business leader in all sorts of situations: on School for CEOs programmes, while chairing Reconomy (I’m Chairman of this private equity-backed waste management business), or working on other projects.  People often like to separate businessmen and women into two categories, ‘entrepreneurial’ and ‘corporate’.  Over the years, I’ve found that leaders who view themselves as entrepreneurs politely disregard those they see as corporate types – and vice versa.  Sometimes they’re not so polite!

So what’s the difference between them?  In my mind, an entrepreneurial leader makes something from nothing, while a corporate leader takes something and makes it better.  The key characteristic of an entrepreneur is that she or he starts from a very small base – just an idea or insight – and turns it into a scalable enterprise.  That initial idea is usually something simple, like Julian Metcalfe’s concept of a modern, attractive sandwich shop.  Think of how many sandwich shops there are in the UK, with different styles, products, locations, supply chains, etc!  It’s a very competitive market.  Julian’s vision and persistence turned a single, bankrupt store into the international Pret a Manger chain we eat at today.

The entrepreneur, then, needs to spot an opportunity, get off their backside and do something about it.  To turn it into a functioning, growing, profitable business, the entrepreneur needs persistence, determination and clarity.

A corporate leader, on the other hand, takes an existing company and improves it, sometimes dramatically.  There are many great examples, such as Rupert Soames’ transformation of Aggreko from a small-cap weakling to a FTSE100 star, or Carolyn McCall’s steady drive to grow easyJet and make it fully competitive with both Ryanair and British Airways.  Traditionally, the corporate leader is seen as more concerned with politics, title and so on, more of an internal focus on their status than an external focus on the customer.  They are viewed as logically deploying business tools and techniques rather than harnessing raw drive and energy.

But hang on a minute!  The really great examples of corporate leadership, the businessmen and women who build their businesses and take them to another level, clearly also require the qualities of an entrepreneur.  The ability to spot an opportunity; drive; persistence; inspiring and motivating people: these are all characteristics shared by winning entrepreneurs and corporate types alike.  The old stereotypes look a little less clear-cut in practice.

Perhaps it’s no surprise there is this convergence.  Some of the most celebrated entrepreneurs, after all, have a solid grounding in the principles of corporate businesses.  As examples, both Brian Souter, who created Stagecoach from nothing, and Jim McColl, a successful entrepreneur who has built his own private equity house, turn out to have been accountants in their early careers.  The ‘boring’ tools channel the ‘dynamic’ energy.  Yin and yang in business, perhaps.

© Patrick Macdonald 2015

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