The difference between innovation and entrepreneurship

Business models, free enterprise, and innovation drive one another. Historians and weightlifting instructors can tell you that human development occurs when there’s resistance. Survival of the fittest can be cruel, but it is absolute and necessary. That’s what I’ve got against socialism: It reduces the necessary resistance; it takes tension and even fear of loss away, thus making people and organizations flabby and complacent.

The ultimate issue with any new enterprise is almost always whether it has attracted a leader with enough sales or rainmaker talent to create customers. Regardless of whether the institution is a business, a social enterprise, a charter school, or a new government program, the real power comes from the enterpriser, not the innovator, the thought leader, or the idea itself. The enterprisers are far scarcer than the rest.

Entrepreneurship doesn’t just provide supply, it builds demand. That’s why it’s crucial to mentor budding entrepreneurs, not just people who want to work alone or be their own boss. True entrepreneurs build new jobs and increase overall demand and spending because they bring something new to the game. Either they take a current product or service and make it available to those who are not served or who are underserved, or they take a new idea and build enthusiasm, interest, and desire for it. An example: Henry Ford didn’t invent the automobile. He invented a way to manufacture and sell automobiles to middle-class people. Ford didn’t just move jobs around, he built a whole new demand for cars.

 Jim Clifton is chairman and CEO of Gallup, and the author of “The Coming Jobs War.” Clifton will speak in Springfield on June 13 on job creation at an event sponsored by the Citizens Club of Springfield and The State Journal-Register. Excerpts from his book will appear in the Sunday Business section between now and his appearance here and are reprinted with permission of Gallup. The event, which will also feature a panel discussion of local leaders, will begin at 7 p.m. June 13 at the Hoogland Center for the Arts. It is free and open to the public.

Nothing in the world can take the place of persistence. Talent will not; nothing is more common than unsuccessful men with talent. Genius will not; unrewarded genius is almost a proverb. Education alone will not; the world is full of educated derelicts. Persistence and determination alone are omnipotent. — Calvin Coolidge

Please read this article carefully so you do not misinterpret this dangerous material. And if you happen to misinterpret it, you wouldn’t be the first. The whole world has it backward.

Here it is: Innovation is not rare in America. Neither is creativity. In fact, there’s an oversupply of innovation in America and other places in the world.

There’s nothing wrong with that. What’s wrong is that America — and most all countries — have a mass shortage, a significant undersupply, of successful business models. Many innovations fail to successfully commercialize. The scarcest, rarest, hardest energy and talent in the world to find is entrepreneurship. Call it rare salesmanship, call it genius business-model design, call it rainmaking, but whatever the case, America doesn’t have enough.

What the U.S. needs more than anything in its quest to win new good jobs in its cities is that rare talent to start companies or to create business models that work, that grow organizations — big ones, small ones, medium-sized ones, sustainable ones.

The business model is everything because there are no new sustainable jobs until there are new customers. That’s true for corporations, nonprofits, churches, schools — every organization you can name.

People usually think of entrepreneurs as those who start businesses, and as such, entrepreneurs are vital — absolutely necessary for humankind. But what pushes humankind forward, as well as entrepreneurs, are “intrapreneurs.” Intrapreneurs work inside companies and are the brains and energy behind creating customers. They’re usually marketing and strategy people, often rare salespeople, but these intrapreneurial breakthroughs can come from any corner of a business.

So when people say “entrepreneur,” they should always include the intrapreneur. An entrepreneur/intrapreneur is the individual and her team who create the business model that subsequently creates more customers, more demand, more product build-out, and then the miracle of quality GDP growth and authentic job creation.

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