Concept
Entrepreneurial Function
The entrepreneurial function is Eric Ries's argument in The Startup Way that entrepreneurship should be a standing function of management, like finance or marketing, used with its own methods, metrics and career path wherever a company's work has an outcome nobody can predict.
Ries is not against general management. Planning, forecasting and accountability let a company do something it already understands well, again and again. The trouble starts when the same tools are applied to work whose answer is unknown: a new product, market or internal service managed through a business case that assumes certainty teaches teams to protect the plan rather than find the truth. His proposal is to add a second discipline beside management, not to replace it. That discipline is not reserved for an innovation lab or for the founder; it belongs wherever there is a genuinely uncertain question, in logistics, HR or finance as much as in product. Its method comes from The Lean Startup: the leap-of-faith assumption, the smallest experiment, validated learning. The example most associated with the book is the FastWorks programme Ries helped General Electric's leaders build. The practical test is simple: if a team can answer what customers will do from experience, manage the work as usual; if it cannot, manage it as an experiment.
A real-life example
The product director of a home-appliance maker in Manisa sorts the eleven projects in his annual plan by one question: can we predict what customers will do? Eight turn out to be predictable. For the other three, including a repair subscription and a rental plan for students, he replaces monthly status reports with each team's riskiest assumption and the next test it will run.
How to use it
- 1Sort your projects into 'known answer' and 'unknown answer'.
- 2Judge the unknown-answer work by validated learning, not by whether the plan was followed.
- 3Look for entrepreneurial work outside product teams too: operations, HR, finance.