Entrepreneurial Leadership – A New Breed of Leaders

By Hasib Ahmed

Updated Over a Week Ago

Minute Read

There are leaders, and there is entrepreneurial leadership.

What makes entrepreneurial leadership different? This article will shed light on the emergence of this new type of leader and the impact it can have on an organization.

The concept of entrepreneurial leadership has existed for a few years, but the characteristics associated with it were difficult to decode. The concept was first introduced by McGrath and MacMillan, who described the new type of leader required by dynamic markets, where there is increased uncertainty and competitive pressure.

The Entrepreneurial Mindset

As mentioned in his book called The Entrepreneurial Mindset, MacMillan says that “the world is becoming too turbulent and unpredictable to use conventional leadership strategies.”

Conventional leadership qualities are good for managing an organization, but for developing an organization into something bigger, a leader needs more than that. This is where entrepreneurial leadership comes into action.

Conventional leadership qualities are good for managing an organization, but for developing an organization into something bigger, a leader needs more than that. This is where entrepreneurial leadership comes into action.

There is constant debate about the ways in which entrepreneurial leaders come into being – are they born with those skills, or do they work to create those skills?

Some of the most notable people that are considered “naturally-born” entrepreneurial leaders are Steve Jobs, Bill Gates, Mark Zuckerburg, and Richard Branson. Many companies also tried to inculcate this concept of leadership into their business model. Some of them were successful, and this changed their whole business outlook.

Two companies that successfully implemented entrepreneurial leadership in their business are UBS and Convergys’ IC Division. Seeing an opportunity in Convergys’ IC division to use available actionable analytics, the company has been able to maintain its ‘small-business’ agility, ensuring an incentivized and motivated workforce.

For its ability to proactively develop entrepreneurial leadership qualities among its top 500 leaders, UBS earned the title of Best Company for Leaders (Europe) in 2005.

The question that arises now is: what characteristics define this new type of leadership?

If you look at the pattern of the characteristics shown by some of the prominent entrepreneurial leaders mentioned here, you can see that they share certain common traits.

Let’s look at these characteristics:

Manages Risk Rather than Minimizes Risk

Leaders help organizations avoid risks and guide them through a safe path, but an entrepreneurial leader takes risks when he knows that these risks can work.  Done properly, this can be like a Midas touch for the organization to grow and become something bigger. These leaders know how to manage risks effectively.

Able to Identify Opportunities

Entrepreneurial leaders have the uncanny ability to sniff out opportunities where others see none. They use this advantage of theirs to take advantage of situations that only they can imagine. Saras Sarasvathy coined a new term in 2001 to explain this process of opportunity identification shown by entrepreneurial leaders known as ‘effectuation.’

A common example of this is related to cooking, where one chef prepares the menu that a client wants by finding the right ingredients for it, while another chef prepares the menu with the ingredients he has in hand.


Open to New Ideas From Anyone

If you look at all the great entrepreneurial leaders, they are all open to new ideas that may come from any source. They are happy to work with a diverse group of people who have different views in order to achieve a common goal, unlike traditional leaders who would like to work with a team who all hold the same views.

Entrepreneurial leaders also learn to adapt to their changing environments and easily learn what works best in which environment.

We have already seen the effect that entrepreneurial leadership can have on an organization with the example of UBS given earlier in the article. This type of leadership is not only helpful for an organization to make breakthroughs at the inception stage but also helps in its survival through the continuous renewal of the market.

Here are some of the ways it affects an organization:


The first effect that can be seen from implementing the process of entrepreneurial leadership in an organization is the high adaptability that it creates. Through this, an organization can successfully compete in a market using its resources. In other words, their business model becomes flexible and can effectively use whatever resources it has.


When an organization behaves in an entrepreneurial manner, it gains an advantage as a pioneer in new markets. Organizations can have a competitive edge and explore new markets, which would not be possible under traditional leadership.

Retention of Talent

Entrepreneurial environments always bring about a positive feeling among employees and help an organization to successfully develop, motivate and retain talented people. Thus, there is less talent spilling over from your organization to that of a competitor.

Entrepreneurial leadership will become an effective method in the future for organizations to remain competitive in the dynamic market and help in their survival through any turbulence.

What Do You Think of Entrepreneurial Leadership?

If you have ideas that you feel like sharing that might be helpful to readers, share them in the comments section below. Thanks!

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Hasib Ahmed
Hasib Ahmed
Hasib is a professional writer working with one of the top job sites in India – naukri.com. He has experience working in the job industry and follows the job market closely; both private and government sectors. He has also published numerous articles that have helped professionals in their career advancement and professional success.
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