What’s the key difference between a bureaucracy and an entrepreneurial business?
I believe it is that bureaucracies are a system of control and entrepreneurial businesses are networks of cooperation. And the benefits of cooperation in business outweigh those of control.
Bureaucracies as a system of control.
Don’t get me wrong: I’m not saying anything negative about bureaucracies by saying they are a system of control. Bureaucracies with control-based management structures allow for only a certain amount of input, collaboration, and cooperation from people lower on the hierarchy, and there’s a place for that type of system. As an example, I’d venture to say that probably all military forces are a bureaucracy.
The steel-making factories near my home where I grew up in the 1950s were also systems of control, not cooperation. There wasn’t much experimentation happening at those factories; once the process and systems were in place, it was just about execution, shift after shift, day after day, for the next 25 to 30 years. No additional cooperation needed.
Think about the things that haven’t changed much over a long time, for example, the services we rely on like water, electricity, or garbage. We know the government isn’t dealing with rapid change, new opportunities, and new situations (for the most part). Once they know what works and what doesn’t, it could go unchanged for decades.
In these instances, you need a sound system of control, not cooperation, operated by people who enjoy working within that system.
Bureaucracies are necessary, but because everything is predictable, programmable, and ultimately about control, the humans within these systems are in danger of being replaced with technology (if they haven’t been already). It’s the inherent risk associated with this system.
Entrepreneurial businesses as networks of cooperation.
An entrepreneurial business always starts with one individual. That entrepreneur possesses a unique skill that gives them the confidence to work directly with customers in the marketplace instead of seeking employment. Eventually, this entrepreneur will require a team to support backstage activities so they can continue creating new value and impressing their customers. In short, they need the benefits of cooperation.
Take my story as an example: I started out as a one-on-one coach, and now Strategic Coach, which I founded with my wife and business partner, Babs Smith, operates in three countries with 115 team members and another 17 coaches. To this day, I do what I was doing 30 years ago, but without the other stuff that doesn’t fit within my Unique Ability. Babs and I made this possible by creating networks of cooperation. At every node of this network is someone whose Unique Ability makes them the best for the job, and the very nature of the network allows us to reap the many benefits of cooperation in business.
As we’ve discovered, especially over the last 12 months, everything is constantly evolving. Therefore, the last thing you want an entrepreneurial business to be is a rigid system of control. That would make the business not alert, not curious, not resourceful, and not responsive to the inevitable changing conditions outside the business. Change requires cooperation.
Control vs. cooperation in business.
Some entrepreneurs have a control-based system, not a cooperative one, which is quickly identified by their inability to retain an innovative team and to scale their business. With this system, they essentially create a job for themselves in the marketplace. They’re unable to focus on bigger, better things or even just the things they love because they have to do everything themselves.
I’ve seen entrepreneurs who start out very cooperative and later move into a system of control. This typically signals the end of their business being valuable in the marketplace because it marks the death of innovation. I’ve also seen big corporations turn from cooperative networks into systems of control in an attempt to prevent innovation that would threaten that control.
Businesses of any size can enjoy the benefits of cooperation. Just because you reach a certain level of success doesn’t mean you’re destined to create a system of control to sustain it. There are businesses with thousands of employees and a solid network of cooperation supporting happy customers and teams.
Innovation as a benefit of cooperation in business.
People and businesses who have a passion for control will only retain others who are passionate about control. And, put simply, these people are not innovative. They prefer to be told what to do and to tell others what to do. This is the extent of their cooperation. Because innovation is uncontrollable and unpredictable by nature, it just doesn’t lend itself well to a control-based business. Again, this type of system is not wrong; it is what it is, and it opts for control over the benefits of cooperation.
But people want to do what they’re good at. And innovators want cooperation.
Innovators won’t stay in a business long that doesn’t allow them to innovate and cooperate in response to the world’s constant and undeniable evolution. Innovators can’t unsee what’s happening in the world around them, and it’s against their nature to sit around and do nothing about it.
A benefit of cooperation in business is that innovators are the ones who adapt and find ways to cut costs with automated systems, technology, machines, AI, and new software. Innovators are even the ones who develop ways for bureaucracies to replace repetitive, controlled human actions with automated solutions.
And those innovators are in turn fueled and supported by business systems of cooperation that encourage them to thrive, collaborate, and create.
Innovators are ahead of the game.
They’re quick to notice changes, determine what people need, and seek cooperation from others. And they’re not afraid to act—even if that action may be imperfect.
How to make your business a network of cooperation.
The benefits of cooperation in business are endless. To shift your business from a system of control to a network of cooperation, start by reviewing everything you’re doing this year. Then, commit to doing 50 percent new things next year. This will encourage you to leverage cooperation and collaboration to reach that goal.
Remember, as an entrepreneur, you’re the leader of your business, and your actions send your team one of two signals:
“I want more control” or “I want more cooperation.”
People will respond to what you want, internally and externally. With Strategic Coach, I’m constantly expanding and deepening cooperation networks whenever possible, which has accelerated in the last 12 months with the pandemic. The benefits of cooperation are clear. Whether it’s Abundance 360, Genius Network, EOS, Hay House, Kolbe, podcasts, books, etc., these external collaborations are not only growing my business but also communicating that “I want more cooperation” to my team and community.
So, make a choice. Will it be a system of control or a network of cooperation?
To strengthen your network of cooperation and discover a world of collaboration opportunities, get your free copy of the Simplifier-Multiplier Collaboration ebook.