IFSR Newsletter 1996 Vol. 15 No. 1
SYSTEMS THINKING, ENTREPRENEURSHIP AND MANAGEMENT
Matjaz MULEJ, Miroslav REBERNIK, Stefan KAJZER
University of Maribor, EPF
SI-62000 MARIBOR, SLOVENIA, P.O.B. 180, fax +386-62-26681
Contemporary notions of systems thinking, entrepreneurship, and management surfaced in the same period of the modern social and economic development. Life’s complexity could no longer be avoided, but had rather to be faced, so did and do turbulence, speed of change, globalisation of economy and life, communication, knowledge, interdependence, competition etc. They have much in common, as well as some differences. Systems thinking aiming at holism and depth by interdisciplinary creative cooperation is not needed by entrepreneurship and management only. These two roles for running an organization differ in defining their dialectical systems, i.e. systems consisting only of a complete set of
essential viewpoints (Fig. 1).
Systems Thinking, Entrepreneurship and Management, Figure 1: Entrepreneurship – Management (Matjaz MULEJ, Miroslav REBERNIK, Stefan KAJZER, 1996)
Business or any other organizational process can be viewed as consisting of two main subprocesses:
- Schumpeterian creative destruction of the old, obsolete cultures, products and technologies, and their replacement by more innovative ones; here entrepreneurship is favored;
- utilization of the existing capacities (human, capital, information) to their full extent and stakeholders’ benefit before they get obsolete; here management is favored.
Fig. 2 shows a process of this kind in more detail. It shows phases of prevalence of the more entrepreneurial and the more managerial behavior. These phases replace one another all the time in an
organizational process:
- making an organization requires more of entrepreneurship,
- growth of the organization requires more of management,
- differentiation of the organization, again, stresses entrepreneurship more,
- consolidation of the organization, again, stresses management more.
At the end of each phase, a crisis surfaces, and demands the next phase’s style of running the organization. The behavior is repeated in a cycle.
Systems Thinking, Entrepreneurship and Management, Figure 2: Organization Life Cycle (Matjaz MULEJ, Miroslav REBERNIK, Stefan KAJZER, 1996)
Both figures also convey that organizational vitality and viability are best provided by entrepreneurial management and managerial entrepreneurship. Both are actually two functions of the same job – satisfying all the stakeholders to the highest possible degree by using as much of systems thinking as possible and needed. Hence, instead of talking about entrepreneurship and management as distinct concepts, it may be wiser to talk about the managerial and entrepreneurial roles that have to be performed simultaneously as phases in modern organizations, business etc. There are also distinctions, of course, e.g. institutional ones: a manager is a paid function, an entrepreneur may be an owner and/or a function, etc. Linking rather than dividing the two notions as well as other concepts is very much needed nowadays. This is what both STIQE-Conferences (Dec. 1992, and Dec. 1994 in Maribor) have been about, and also STIQE ’96. Due to too much specialization and focusing, linking and interplay are left out of consideration too frequently. We are trying to help making up for this mistake.