The vast majority of the different rulers in Latin America who are within the formal power, the most important media in those countries, the different training and education centers, as well as the representatives of the national, provincial and municipal governments manifest and speak permanently regarding the importance of development and the need to develop SMEs entrepreneurs / entrepreneurs.
But despite all these verbal manifestations, many facts show that the number of these businessmen and entrepreneurs is not increasing, those that exist have increasing difficulties to survive and the number of entrepreneurs trying to replace those who are "retired" seems to be inferior to them.
To make things worse - and even more "unintelligible", at least in the eyes of the layman - the money available for the development and support of businessmen and SMEs entrepreneurs has been growing systematically over time, Banks and financial institutions offer more programs with greater masses of money that they offer to these entrepreneurs, and national, provincial and local governments have also closed agreements and loans with international organizations where they express the importance of these entrepreneurs.
In most of the different Latin American countries, an organ for dissemination, promotion, creation, and support of this type of organizational arrangement has even been created, recognizing the importance they have in generating genuine work in addition to their important contribution to the economy, social, education and dignity of citizens.
However, year after year the official statistics and the facts show that this type of businessmen and entrepreneurs is in decline both in terms of their number, and in terms of their contribution to the economy, as well as with respect to the generation of "work genuine".
The most concrete manifestation is visible when observing the growing levels of unemployment that prevail in the different countries of Latin America, being more dramatic in some of them than in others.
Statistics worldwide show the enormous importance that these organizational pioneers play to the point that they generate jobs for more than 70% of the population of the most developed countries and their contribution to the gross national product can reach levels of up to 40%. Recently, a senior official of the SBA "Small Business Administration" program has stated that practically more than 95% of new jobs are created by this type of SME entrepreneurs in the United States of America, a country that is usually associated with the primacy of a corporate-type organizational model worldwide.
On the other hand, the most painful manifestation due to the lack of these entrepreneurs is found in the enormous mass of the unemployed and underemployed population, which in turn is reflected in the very high rates of poverty and indigence that have reached in the different Latin American cultures, levels historic never seen.
And to make things worse, this happens in prevailing regimes within countries that claim to embrace "democracy", and manifest populist interests.
If these are the facts - which seem to be here to stay within the different countries in Latin America - what can we do to find out about the "cause" of this diagnosis.
It is assumed that if we talk about promoting, creating and sustaining SME entrepreneurs and entrepreneurs, financial resources are assigned, public, provincial and municipal entities are created for this, an important body of people, professionals and officials are made available to society and professionals in the field of human resources, advertising campaigns aimed at promoting the importance of the SME entrepreneur are promoted, at some point the results should be reversed. But this has not happened, and it does not seem that it would happen, taking into account the observable facts.
In this half-day we have to deal with some points that may help us to elucidate how it is possible for a situation to arise in fact and in reality, which is contrary to “what is said and manifested”.
First of all, we must clarify that the verbal and written manifestations of help and assistance to SMEs, generally pay little attention to entrepreneurs.
These verbalizations regarding the preponderant role that SMEs play both in the creation of the domestic product of the countries as well as in the creation of “genuine work”, seldom lacks the importance of the businessman and the entrepreneur.
It is as if they assumed that there was no relationship between SMEs and businessmen - entrepreneurs. And this turns out to be a crass error because the only possibility that an SME company exists, is supported by the person of a businessman or an entrepreneur.
The foundational importance of the "person" is vital and there is no type of organizational arrangement that can be carried out and that is sustained over time - assuming that donations, gifts and subsidies are not going to be received as is the case with companies. SMEs - which does not privilege the "founding" partner, the one who is the creator and innovator in terms of product - service and in placing them within a context or market, within a reciprocal relationship with Clients.
The importance of the entrepreneur - entrepreneur has not escaped the eyes of the Austrian economist Friedrich A. von Hayek ("Law, legislation and Liberty" - 1976) when manifesting the benefits it provides to society, both for those he knows and those who has not even come to know:
“The aim for which the successful entrepeneur wants to use his profits may well be to provide a hospital ora n art gallery for his home town. But quite apart from the question of what he wants to do with his profits alter he has earned them, he is led to Benedit more people by aiming at the largest gain than he could if he concentrated on the satisfaction of the needs of known persons. He is led by the invisible hand of the market to bring the succor of modern conveniences to the poorest homes he does not even know. "
The implications of the role of businessmen and entrepreneurs is an additional factor to which special consideration should be given, since to the extent that they act and behave, they are at the same time shaping their own personalities and also those of third parties (Frank H. Knight: "The ethics of competition" - 1923).
It seems that these behavioral aspects related to the actions, attitudes, beliefs and values of businessmen and entrepreneurs, are not often taken into account by those who verbalize about “assisting SMEs”.
It is known that in the United States of North America - cradle of important business leaders - the state organs privileged this particular behavioral aspect so strongly related to the personality of the entrepreneur.
At the beginning of the 20th century, some 100 years ago, the government of the United States itself, aware of the importance of having these particular prototypes, dedicated an intense program aimed at identifying those attributes and characteristics that are present in entrepreneurs and businessmen.
As a consequence of these studies, the next task was quite crystal clear; Programs should be developed that promote the development of these attributes and characteristics.
But they went even much further. The next step, and taking into account the importance of the context in the development of people ("nurture + nature"; the genetic and the social; the man and the circumstances "), they took a second very important step: they identified the conditions that They were to create that enables the successful creation and sustaining of this particular species of people who get on their backs to create work for themselves and others.
These personalities installed in the government (in this case, from the United States of America) did not have to be wise to know that the mere personal condition and individual predisposition towards “being an entrepreneur” was not a sufficient condition, although it was a necessary condition; It should be accompanied by creating the proper conditions that allow - this particular species represented in the role of businessman and entrepreneur - which has an internal engine that mobilizes enormous energies, to be successful and consolidate over time, it should have the external conditions in context, to support them even more.
This means the need to give the necessary incentives to the entrepreneur and entrepreneur; otherwise, what would be occurring is a flat and simple extinction of attributes, behaviors and attitudes with respect to those entrepreneurs and natural entrepreneurs who would not be supported and encouraged contextually.
If the context supports and encourages inaction and the lack of creation, of genuine contributions and contributions, the people within the context will stop acting and will not create, or make contributions or contributions.
A field study has shown evidence that a vast majority of people prefer to have a “job” in a public body over a private one, giving up even up to 40% of their remuneration.
Furthermore, at the moment in some Latin American countries there is a huge number of people who are paid at the end of the month for not working, despite the fact that these remunerations represent slightly less than 25% of a salary that they would be receiving within private organizational arrangements.
In this regard, it is suggested that managers at both the public and private levels become familiar with the important contributions made by James March and Herbert Simon (“Organizations”; Wiley and Sons - 1958) who, with respect to the organizational participants, were able to distinguish two types particular decisions that they adopt in their relationship with the company.
They refer to the “decision to produce”, that is to say to produce concrete and rather tangible results related to adding value where their own contributions to the organization are greater than the “inducements” received from them.
This "decision to produce" is clearly different from the "decision to participate", where the organizational members respond mainly in terms of attending and attending the organization and such assistance and attendance is not always accompanied by adding value.
In this case, the inducements provided by the organization are superior to the contributions of its members and it is obvious that the sustainability of the organization itself begins to be at stake.
We find ourselves - within some Latin American countries - with situations where the number of people who obtain rewards for attending and attending, and where even on more than one occasion this assistance consists of a monthly subsidy where the presence must be given for only one day a month, the number of organizational members that attend is of the same order as those that produce.
And hoping to achieve economic development through this type of proposal turns out to be an unattainable panacea, as the results and facts show. But the gravity of this situation is even greater.
Taking into account that what happens within a community is a holistic manifestation where there is a continuous interaction between the different forces, starting this XXI century we find that the competitive capacity within the different Latin American cultures is rather an exception and not Rule.
What the State self-declared as protector encourages is the appeasement and numbness of people who, under different conditions, would be willing to channel their energies productively; the vast majority of people are oriented towards production and service rather than being rewarded for "attending" and "attending" or "not-attending".
When preferences and guidelines for "attending" and for "attending" or "not-attending" appear, it is because this modality has been encouraged, and the responsibility of those to whom it fits cannot be delegated.
There is a tendency and predisposition within Latin American cultures that to a certain extent is also common to that of less developed and civilized communities: the “locus of control” is external.
What happens to us has to do with others; it is others who harm us. And we observe very little of ourselves.
The methodology adopted by some experts in organizational change and development based on the “Johari window” (Eric Gaynor Butterfield: “Congress of Organizational Development”; Argentina - 1997) is recognized, which is infrequently taken into account and even less effectively applied.
One's observation to learn about how Others see us and how we see ourselves is important. And, of course, it is also relevant to analyze the congruence between these two perceptions.
Therefore it is quite common that - as a consequence of this look that privileges the external - we seek and explore "solutions" from the outside. A solution from the outside privileges “massage” when in reality the results to be achieved may have much more to do with “gymnastics” (“Career Development” Workshop; directed by Eric Gaynor Butterfield - June 1995).
The "massages" from the outside in the form of grants and compensation do not have to generate the same energy as "gymnastics" exercised from within. And the entrepreneur, like almost all personalities who need to reach levels of success by putting on their backs the support of others many times in extremely vital needs, bases their success on a very strong and hard gymnastics.
But if their “human resources” are massaged in such a way that they only need to assist organizations instead of producing, and that they reach unsatisfactory production levels where the company's out-of-pocket expenses are greater than the contributions of its members, the company itself will not it has to subsist.
And the Latin American businessman confronts this type of situation daily.
This is further aggravated by the fact that there is not always a reciprocal relationship in the psychological - and also formal - contract between the organization and one of its members.
Continuity can be interrupted at any moment of the company's progress by its members, but the same does not happen by the organizational leader, and if he agrees to do so, it has an additional cost that the organization must absorb.
At the Organizational Development Congress (Eric Gaynor Butterfield - 2001), a very interesting debate arose from a question related to "management" in companies within some Latin American cultures. It happened in Argentina, and this concern, the re-question that I have shared with whoever had generated it was the following:
Do you think that in Argentina there really is management? Do you manage your companies? Since the vast majority of people were directors, managers and executives, they naturally responded that yes, they managed.
It was then that I asked them what are the necessary conditions for there to be management in the relationship that a "superior with a subordinate" maintains. Many responses were linked to the tasks that the superior assigned to the subordinate and in this way they perceived that they "managed".
Continuing with this interesting approach, I tentatively stated there that management in the relationship between a superior and a subordinate also implies, and at least three things:
- The manager must be in a position to hire on his own the personnel he is in charge of both within his unit or with respect to those who participate in his projects; The manager must be in a position to promote and reward “differently” to different people (subordinates). The concept in force here is that "There is nothing more unfair than treating people who are different the same." The manager must be in a position to transfer and even demote and fire on his own. It is based on the fact that a person cannot be held responsible for the results in his departmental unit or in his project if - compulsively - he must have within his own team those who do not need or are not competent, or do not add enough value in relation to the rewards they receive.
If these three conditions are not present - and they definitely are not present within the vast majority of organizational arrangements in Latin American cultures - then management simply does not exist.
And if there is no management, being the managers who must implement the strategy of the top through tactics and procedures to be implemented in their subordinates, the organization is adrift. At the moment, no vessel is known to have reached a good port without the rudder or the proper direction.
There are other aspects that are also very important, also in relation to leadership and management, which are vital for every businessman and entrepreneur. We know from the Hawthorne studies - or at least it is one of the most important lessons of this enormous research work - that many times it is the group that sets the “standards of productivity and production”.
When this is true, there is no management either and we find ourselves in a situation similar to the one mentioned in the preceding paragraph.
Within some countries, it is mandatory to assign the role of union delegate to those small companies that have more than 10 people working in them, and it is known that this eleventh "employee" - we have said employee and not worker - can reach levels of productivity close to to "zero" without suffering negative consequences.
If within that small company the “standard” of productivity per person per day was “20 units”, those that achieve productivity of 10 appear as “low productivity” until the moment the eleventh employee is hired.
But by the time the eleventh employee bursts in and their productivity is 5 or less - and this is even visible to the rest of the organizational participants and is even displayed with pride - those organizational participants who had a productivity of 10 "and was a low production “standard”, the moment the delegate enters he becomes an employee “who appears” as highly productive: he is producing 100 percent more than the delegate.
Of course, and on the other hand, there are other additional energies that are forces opposed to business development, since the delegate also does not find within his interests that there is a high level of productivity since if this were the case, his colleagues would see it from a perspective of "little advantage".
In short, the energies that have to flow within the work team, have to be oriented to “reduce productivity standards”.
Under such conditions, who wants to remain an entrepreneur and entrepreneur? And besides, even if I wanted to, how long could it be?
There are other contextual aspects that also threaten the development of the businessman and entrepreneur and especially against the orientation of these personalities to hire more staff.
One of them is the labor lawsuits that have become a true industry for many lawyers and their acolytes.
Field work has shown that a large majority of businessmen have been in serious difficulties in their companies, as a result of labor lawsuits, some of them having to completely close their establishments. Even in situations of dismissal with just cause, the rulings have been contrary to the employer. Most of the labor lawsuits are unfavorable in their consequences for businessmen and SMEs entrepreneurs; Even in the event of having won a trial, the businessman has had to pay the fees that the judge has assigned to his counterpart.
In a workshop on Entrepreneurs and Entrepreneurs developed about 5 years ago I addressed a question to the attendees: how many of you are self-sustaining, how many of you work in an organization and are paid "monthly", and how many of you besides supporting yourself? themselves employ "others"?
As no answers were received, the questions were “individualized”: How many of you receive any fixed remuneration? Can you raise your hand? And the vast majority (more than 85% did).
And the following question was asked: How many of you work on your own individually, without the assistance of others who would have to pay for your services? Two participants (10%) raised their hands. They were professional university graduates.
In this activity, which was mainly oriented towards entrepreneurs, only one person "lived and confronted" the role of entrepreneurs on a daily basis.
Actually, those of us who had organized the small day were satisfied with the presence of many people who - in one way or another - were expressing their interest in "being", in transforming themselves as businessmen / entrepreneurs and were even willing to dedicate time and some money to it.
As a "letter of intent" towards said transformational process, a form was delivered to all participants that would be the roadmap that they had to follow and that they had to return within the following week through the means that was most convenient for them; coming personally to our Institute, by "physical" letter, or by email.
We did not receive any response from them with the sole exception of the one person who "was already an entrepreneur and worked on his own."
Apparently there is a very interesting finding and that we should not miss. Those who are not entrepreneurs / entrepreneurs and want to transform their role as employees or self-employed tend to show “interest” in something new but do not necessarily take the necessary actions to do so. It seems that they like to listen, learn, and even see everything that is related to the employer… but then there are no concrete actions in that direction that, supposedly, is the desired one.
An entrepreneur associated with our Institute with whom we sometimes work together in processes of change, development and organizational transformation, states that the process to which we have mentioned where people are interested but do not take action, is very similar to what happens on a motorway or highway where - as a result of an accident - a deadlock occurs, and most motorists pass very slowly through the accident site, but not many really stop and take a concrete assistance action.
We have given this type of behavior the name of "predisposition to find out" but not to act.
For a long time, at The Organization Development Institute International, Latinamerica we have been studying the phenomenon that has been taking place in Latin American societies and cultures in relation to the Entrepreneur / Entrepreneur issue and which seems to come in two main stages:
1. People who work in organizations have realized that they most likely will not retire from the same company.
It will be common to find executives and professionals who find employment in more than 5 companies during only their first five or 7 years of work.
It has also been visible to the eyes of the different organizational members that what is known as a “mid-life career crisis” - and that it was a phenomenon usually experienced by staff in the United States of America - has already been installed within the organizational cultures within Latin American countries.
And these people have the need, orientation and even a preference "to learn" about the Entrepreneur / Entrepreneur.
But with regard to this predisposition there is a difficulty; knowledge and learning are not necessarily a necessary condition for business success. Larry Ellison - in a Yale University commencement speech - told graduates, as well as graduates, that many of the good checks they would have received as corporate senior executives would be signed by non-graduates. Universities
For this he cites various "drop-outs": Bill Gates as the richest man in the world, and also the second and third richest man on the planet, along with Michael Dell who is also among the 10 richest men on Earth and that continues to move up the list.
At The Organization Development Institute International, Latinamerica we are finding evidence that there are many people who are interested in becoming entrepreneurs and entrepreneurs, and that they are channeling many of their greatest and best energies and resources towards it.
However, various field work and observations suggest that the "transformation" is not that simple or easy to perform.
The behaviors, practices, attitudes and values that people who have participated in organizations for many years incorporate are not easy to radically transform in order to become entrepreneurs and entrepreneurs.
A long list of both conceptual and practical differences between "professionals" and business-entrepreneurs, was described by Eric Gaynor Butterfield in a Workshop held in 1999: "The transition from professional to business-entrepreneur."
2. Stephen Covey ("The 7 Habits of really effective people" - 1995) refers to the joint need of various aspects in the process of being efficient and effective: knowledge (which is related to knowledge), skills (that are linked to know-how), and attitudes (which require a strong internal desire sometimes called motivation).
In his later work (Stephen Covey: “The eighth habit - from effectiveness to greatness” - Paidós - 2005) the author tells us about an eighth habit that “is not a mere addition to the other seven, a habit that, somehow it would have been overlooked. It is about seeing and harnessing the power of a third dimension of the seven habits that responds to the main challenge of the new age of the knowledge worker.
Habit 8 is finding your voice and inspiring others to find theirs. " That is why, Abel Cortese and Eric Gaynor when referring to "The 7 Intelligences" emphasize the importance of Organizational Intelligence where own inspiration must be accompanied by inspiration to third parties ".
Every businessman and entrepreneur is characterized by his inspiring capacity - both his own and towards third parties -. And this is usually not learned in any top-tier university in the world, as well as within the entire corporate world.
3. People have been used to learning something new through what we can call “vicarious learning”, resulting from “learning by taking the place of the other” that would be linked to “delegated learning”.
For many centuries people did not study at Universities to complete their studies with Diplomas, to finally access a job in a company or organization; this has definitely not been the prevailing model.
Rather, people have learned by working with a "teacher" as apprentices; This practice was accompanied by actions by the teacher towards “showing” what should be done and how to do it rather than to talk to him and convey what should be done and how it should be done.
That is why it does not have to call us too much attention when nowadays and within the organizational world, managers are surprised by saying that their personnel do not comply with their orders and instructions. R. Word & A. Bandura (“Social cognitive theory of organizational management”;
Academy of management review - 1989) suggest that from the perspective of “vicarious learning” organizational participants decide and act based on what they observe.
(Additional material in this regard can be found in the works of Eric Gaynor Butterfield where he explicitly refers to "Practical Intelligence").
People learn and we can transform ourselves from a role (such as that of an employee to that of an entrepreneur or entrepreneur) through what is also known as “modeling” that results from observing and imitating others.
A. Bandura, in “Social learning theory” (Prnetice-Hall - 1977), gives a good description of it.
Much has also been said about Coaching and Mentoring but we find few programs where the same applied for the development of the Entrepreneur / Entrepreneur profile.
And this merits a debate in itself. What we do know within behavioral sciences is that “behavior shaping” can be helpful to substitute and replace some behaviors, profiles and roles that we wish to replace with others (as is the case of wanting to substitute our current roles for those of an entrepreneur).
Henry Tosi, John Rizzo and Stephen Carroll (“Managing organizational behavior”; Blackwell - 1995) emphasize that there are several necessary conditions that arise under the learning of “vicarious learning” based on the works of RA Baron (“Behavior in organization: Understanding and managing the human side of work ”_ Boston - 1983) and HM Weiss (“ Subordinate imitation of supervisory behavior: the role of modeling in organizational socialization ”; Organizational behavior and human performance - 1977); They are:
- “The learner must have a reason to pay attention to the model or stimulus. Anything that attracts attention, such as expertise or status, will contribute to attention.The learner needs to retain sufficient information to pattern behavior after the model.The person must have enough ability to engage in the model's behavior. Most of us cannot model ourselves after a great athlete or Nobel Prize winner in physics. There must be a motivational or reinforcement element. The person must perceive the probability of rewards and eventually receive reinforcement for imitation. There must be some incentive and encouragement involved. "
These conditions are important with respect to what happens within an organization, but it may be necessary to add some additional aspects when it comes to transforming roles of organizational participants into roles of entrepreneurs - entrepreneurs.
In the case of managerial, executive and professional personnel who have been employed in an organization for many years, they have generally done so (in the different Latin American cultures) within a subsidiary of a foreign multinational or with a private national company (for In this case, we are exempting public entities both at the national, provincial or municipal level since there is a strong orientation of their members and employees to participate rather than to produce - See previous comments in the eyes of James March & Herbert Simon).
Well, in the event that they have been linked to a multinational company, these people largely assume that Clients "are there" and are affordable through advertising, for example.
What these people do not take into account is that most of the subsidiaries of multinational companies operate as oligopolistic companies and therefore face relatively simple situations in terms of obtaining resources.
On the other hand, those who work in private national companies are very clear that this is not the situation they experience on a day-to-day basis; they are in a highly competitive market where their advantages - if they had them - are not easily sustainable over time.
On the other hand, we have observed how these organizational participants within national companies perceive that they are not rewarded to the extent that they consider it "fair" and those who know "equity theory" (Adams - 1961) can give proof of this.
Many of the dismissals of organizational participants who have been employed in national companies do not culminate like those of members who work in subsidiaries of multinational companies (a tacit and quick agreement that usually does not lead to formal litigation).
The labor lawsuits of these participants belonging to private companies - that is, towards other businessmen and SME entrepreneurs - is still recorded as an image; And just as it can be profitable for them to take advantage of illegitimate situations in front of their employer as a businessman - entrepreneur, the images recorded within themselves, even more so when they have been illegitimately benefited with compensation in labor lawsuits where the employer has been harmed, makes that the own employee benefited from said action does not "internalize the advantage of being a businessman or entrepreneur."
Anyway, and like so many others, he can speak and verbalize about “being an entrepreneur”, he can attend courses and workshops on “the entrepreneur”, he can buy books and learn about the subject, but in his most intimate sense he has not to do the things that are necessary to Do to Be an Entrepreneur.
They know very well that - in their innermost depths - if he becomes an entrepreneur and therefore must create work for others, he will be subject to this vulnerability (currently and in some Latin American cultures labor insurance - occupational risk insurance companies - They are not fully responsible in this matter of labor lawsuits for accidents and even some laws in jurisprudence have established that "there are no limits" to the compensation that an employee may require).
This means that the employer - which differs from a worldwide organization - has to answer to any employee even with all the personal property he owns, including his own private home.
The infinity of real cases where the entrepreneur - entrepreneur has been directly harmed and who is in the sight of others is so great that few want to dare to a role where the risks are infinite and unlimited. But of course, who does not "talk" about being an entrepreneur and being an entrepreneur?
Dear participants who have participated intensively today and have expressed their interest and preferences towards an independent activity where leadership is vital, please take into account some actions of those who founded and developed companies.
Alexander the Great who came to conquer the entire world and - in a confrontation with enemy ships and warriors was warned of their immense superiority by his lieutenant as a clear warning to refuse the fight and wait for another opportunity - he answered whoever warned him that: "Row harder and set fire to our boats… if they want to see their people and their land again, we will have to do it with their boats!"
And at the hour of glory as a result of the victory, Alexander the Great himself was assigning and giving away lands, gold and other goods taken from his officer corps, which led one of them to ask him: “My general, what did you do? must it be left to you? He is distributing everything for which we have fought for years and that we have finally conquered ”.
And Alejandro replied: "I have all the way to go for the next conquest."
As in other workshops, we give them a form to be completed that we understand is helpful to observe "where we are today as entrepreneurs" and can help us define if we really want to be and then explore how to do it.
We at The Organization Development Institute International, Latinamerica renew ourselves at your services.
