Competence vs. Entrepreneurship
Heiki Immonen
Principal Lecturer of Entrepreneurship at Karelia University of Applied Sciences
Many moons ago I did my master’s degree in physics. One of my classmates continued and finished his PhD a few years after. His next step was to move with his wife to Switzerland. He had received a post-doc position from a prestigious Swiss research institution. During their three-year stay, my friend became an expert in X-ray optics. He designed optical elements that were bought by synchrotron operators around the world. After his post-doc position at the research institution came to an end, he and his wife made the decision to move their family back to Joensuu, Finland. My friend had realized that he had the opportunity to keep servicing his synchrotron customer network independently of the Swiss research institution by utilising the lab equipment available at the physics department in Joensuu. And simply as that, he had become an entrepreneur.
In this day and age, entrepreneurship is touted as the miracle medicine to heal economies at both the level of the individual and of society. In Finland, this is evident at the level of the National Government Programme (2018) of prime minister Juha Sipilä’s government and locally for example as one of the three strategic traverse themes of Karelia University of Applied Sciences (2018). This has resulted in a situation where universities and their partner organisations are offering continuously expanding portfolios of entrepreneurship education and services. Recently we discovered that there are more than eighty different entrepreneurship-related courses or services (including services offered by partner organisations) available for Karelia UAS students. In a university of about 4000 students, this is a big number.
In the final analysis, people give money away only in exchange for something they consider valuable, out of many other competing options. Keywords here are value and competition. In order to get the customer’s money, an entrepreneur must be competent enough. His offering must be seen as valuable by the customer relative to competition. By definition, to be competent in something is to have a capability to solve a set of associated problems, to create value competitively. A competent carpenter stands out from the rest through quality and affordability. Competence is competence regardless of the employment framework, i.e. it doesn’t matter whether the carpenter operates as a paid worker in a larger company or as a single entrepreneur.
When we teach our students the many skills and mindsets of entrepreneurship, such as creativity, experimentation, business planning and networking, are we actually teaching them anything of value? Can they find any employer or a customer who is willing to pay for the direct application of these skills? The answer in majority of cases is no. An entrepreneur with only entrepreneurial skills and without competence, i.e. something valuable to offer to a paying customer, is a bust. This is evident even at the level of ideation. In a problem-solving setting, people without any competence relative to the problem typically produce worthless ideas. You really need to be competent in the given topic to have a creative impact (Von Hippel, 1986).
Do entrepreneurship skills carry actual benefits, then? The utility of business management side of the skill-set is clear. Management of a business requires you to take care of marketing, sales, revenue, costs, labour, investments etc. To run a business, you need to know how to run a business. What about the innovation-side of the entrepreneurship? Advanced innovation methodologies such as NASA’s systems engineering framework (Kapurch, 2010), Toyota’s set-based design (Sobek et al, 1999), ICED methodology i.e. Innovative Conceptual Engineering Design (Camarda, 2013), Innosight’s first mile commercialization process (Anthony, 2014) or the Lean Startup methodology (Ries, 2011) are actually processes of learning about a problem and a set of possible solutions. In other words, the innovative and creative sides of entrepreneurship are actually processes of becoming competent in a given topic. From this point of view, innovation and creativity are similar to education; both activities have the goal of becoming competent at something that is valued in the marketplace.
Whether one aspires to become a highly paid employee or an entrepreneur, try to choose a problem that matters to you. Clinical psychologist Jordan Peterson argues that you should do what is meaningful not what is expedient (Peterson, 2018). According to him, a good compass to guide you is your interest and curiosity. It’s quite likely that you cannot even articulate why a given topic draws your attention. Try to understand the problem – the customer need – more deeply than your competitors (Christensen et al, 2016). Solutions come and go but your knowledge about the problem keeps on accumulating.
Perhaps we need to adjust entrepreneurship education with more emphasis on entrepreneurship as a process of becoming competent rather than entrepreneurship as a skill to implement and execute a business idea. From a higher point of view still, what is the correct ratio of entrepreneurship education and training of skills of more direct value on the marketplace?
References
Finnish Government. (2018). Government Programme. Retrieved May 3, 2018 from http://valtioneuvosto.fi/en/implementation-of-the-government-programme.
Karelia University of Applied Sciences. (2018). RDI Focus Areas and Themes. Retrieved May 3, 2018 from http://www.karelia.fi/en/research-development/areas-of-focus.
Anthony, S. D. (2014). The First Mile: a Launch Manual for Getting Great Ideas into the Market. Harvard Business Review Press.
Camarda, C. J., de Weck, O., & Do, S. (2013, June). Innovative Conceptual Engineering Design (ICED): Creativity and Innovation in a CDIO-Like Curriculum. In Proceedings of the 9th International CDIO Conference.
Christensen, C. M., Dillon, K., Hall, T., & Duncan, D. S. (2016). Competing against Luck: The Story of Innovation and Customer Choice. Harper Business.
Kapurch, S. J. (Ed.). (2010). NASA Systems Engineering Handbook. Diane Publishing.
Peterson, J.B. (2018). 12 Rules for Life: An Antidote to Chaos. Penguin Random House.
Ries, E. (2011). The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses. Crown Books.
Sobek, D. K., Ward, A. C., & Liker, J. K. (1999). Toyota’s Principles of Set-based Concurrent Engineering. Sloan Management Review, 40(2), 67.
