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Are You an Entrepreneur, or a Small Business Owner?

April 7th, 2010 :: Monika Jansen
Orange and gray gears


Innovation is the wheel that keeps the business world turning.  Without it, we’d be living in energy inefficient homes, driving cars that run on leaded gasoline, and wearing parkas that don’t really block wind or keep us dry in a downpour.  Innovation is that little—and sometimes big—something that separates entrepreneurs from small business owners.

In this, the final of a three part series based on a conversation I had with CPA and small business consultant Jason Howell, I share with you Jason’s thoughts on entrepreneurship, which are in turn based on Peter Drucker’s writings and thoughts.    

For those of you who are only vaguely familiar with Peter Drucker’s name, he was a writer, management consultant, and self-described “social ecologist.” (He passed away in November 2005.)  I’ll let Wikipedia take over from here: “He…explored how humans are organized across the business, government, and the nonprofit sectors of society.  His writings have predicted many of the major developments of the late twentieth century, including privatization and decentralization; the rise of Japan to economic world power; the decisive importance of marketing, and the emergence of the information society with its necessity of lifelong learning.  In 1959, Drucker coined the term “knowledge worker” and later in his life considered knowledge work productivity to be the next frontier of management”.  (The hyperlinks were supplied by Wikipedia, too.)

Peter Drucker described an entrepreneur as someone who innovates.  He or she looks at a product or service in a different way and reinvents it to offer something new.  A small business owner, on the other hand, is simply someone who owns a business and replicates what others have done. 

As Jason pointed out, entrepreneurs make a difference in the community, the country, the industry, and/or the world.  There was already light, but Thomas Edison transformed our concept and use of light when he invented the light bulb.  There was already a process in place to build a car, but Henry Ford took it to a whole new level when he invented the assembly line.  Everyone who gets into business does so to make a difference on some level. Maybe that difference is not as life-changing as inventing, say, the microchip, but one that makes a difference nonetheless.

“If someone laughs at your idea, it’s probably a new one.”  Jason couldn’t remember who said it, but I think it’s a great quote.  Even though there’s a fear of innovation and the change it will bring, innovation attracts people.  Think about big, innovative companies who have truly changed the way we live or do things.  Microsoft, Google, and Apple immediately spring to mind, probably because I use their products/services on a daily basis.

But there are lots of smaller companies out there that have changed how things are traditionally done in their industry too.  Check out Wexley School for Girls, which is not a school, is not for girls, and was not founded by someone named Wexley.  It’s a very different kind of ad agency based in Seattle, WA that has one of the funniest, coolest, hippest, wow-est, and most irreverent websites I have ever visited.  I don’t even know them, but I love them.

If you’re company does things differently, find those first adopters, those people who will appreciate and embrace your different-ness, who will love your new product or service.   You never know how being innovative could change your life—or the world.

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  • marlamarkman
    Wow, what a great post! Very thought-provoking. Sent a chill up my spine!
  • I always considered myself a small business owner, until I read this article. Now I consider myself on the road to becoming an entrepreneur. Stepping outside of the box is a bold move. It can go for better or for worse. But I believe embracing your own strange idea is the best way to brand yourself as "one-of-a-kind" or "the first." Who knows how high you can soar?
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