Jonathan Ive, Chief Design Officer at Apple, once said, “It’s very easy to be different, but very difficult to be better.” What can entrepreneurs do to run better businesses?
Piers Thompson of Nottingham Business School and Robert Huggins of Stanford University recently completed an extensive review of research on entrepreneurship to help answer that question. Their article, which looks at the relationship between entrepreneurship, innovation, and local economic growth, found that well-developed networks are a necessary component of healthy businesses. In the end, the researchers identified five steps that an entrepreneur should take to make her firm stronger:
Local entrepreneurship ecosystems impact individual entrepreneurs’ success.
Policy implication: In areas where there is little entrepreneurship, it takes comparatively more work for entrepreneurs to connect to the existing entrepreneurial networks relative to entrepreneurs in areas with high entrepreneurship.
To spur innovation within a company, an entrepreneur should build connections between people within her firm.
Policy implication: When firms have internal support structures, they improve their capacity to scaleup.
Entrepreneurs are more financially successful when they build networks outside of their own company.
Policy implication: When an entrepreneur has large professional networks, she increases her access to knowledge, which can spur innovation within her own company.
It is important to search, screen, and select for the most appropriate knowledge possible.
Policy implication: Firms should build teams and build capacity to gain the highest quality talent and research possible. To do this, firms should create methods to filter through what is and is not relevant to the firm.
In order to acquire high-quality knowledge, entrepreneurs should build diverse local and global networks.
Policy implication: The development of entrepreneurial networks should match the policy interventions within the local area.
Contributed by Emily Luepker