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The Entrepreneurial Mindset is a truly remarkable book and, I believe, an extremely useful one. However, it is not the book that, in my opinion, the reviews that have been posted here imply it is.

For one thing, it is not about entrepreneurs. In fact, the cast of characters is dominated by managers in relatively large organizations. Nor is it about the kinds of coalition-building activities that Gifford Pinchot described in Intrapreneuring (although the topic of political obstacles is addressed).What it is about is strategic innovation. It is a detailed description of an elaborate and exhaustive process for rationally generating (and choosing among) strategic alternatives in the face of uncertainty. This is not a process that the authors have observed while studying entrepreneurs. It is, rather, a description of the tools the authors have developed to work with management teams in established firms to discern original responses to business challenges. Said another way, the book has to do with the process of discovering new things to do – things for which there are no precedents and about which there is very limited data/information – in established businesses.

In some respects, this book constitutes a synthesis (and an impressive one) of themes that have been at work in the strategy literature in recent years. The majority of these themes reflect concerns about how to respond to a business environment in which products rapidly become commodities and (therefore) in which new options are much more strategic hypotheses to be investigated than they are plans to be formalized and funded. Much of the authors’ attention is devoted to unearthing new hypotheses from the available data and sorting through them to settle on future courses of action.

The Entrepreneurial Mindset, while easy to read, is not a light narrative by any means. It is, at base, a technical book about a specific approach to strategy development and implementation. It views strategy first as a creative activity and then as a resource allocation problem that terminates in resource allocation decisions first to classes of opportunities and then to specific projects. The search for options (”opportunities” in their terms) occurs at the product/market segment level, not at the business level. Areas considered in search of novel approaches include product features, delivering more value at specific stages of the so-called Consumption Chain, market resegmentation, and radical redesign of the value chain.

There are a few cases in which the authors’ actual practice around a task or topic does not become clear until 20 pages or so after their initial presentation of it. Thus, it is hard to derive full value from this material without taking detailed notes and without giving it a second read. (The authors themselves seem to anticipate the need for a twice-through reading, advising us on several occasions that it is OK to skip the next section if this is the first time you’ve read the book.)

There are none of the traditional “soft” tools of strategy to be found here – no mission statements, value disciplines, driving forces, or what have you. While the book does deal with “Building Breakthrough Competences” in Chapter 8, the approach presented revolves around identifying how to excel on one or more core performance metrics rather than with respect to specific sorts of skills and activity groupings that Hamel & Prahalad adherents have grown used to. Therefore, people whose primary interest is in enunciating over-all themes and affecting corporate culture will not find wisdom on their principal needs here.

As mentioned above, the book incorporates the insights of other researchers – carefully documented in an extensive (and useful) bibliography. Happily, some of the most intriguing of MacMillan’s own published ideas have found a place in the process. Other “connections” include:

Pascal, Managing on the Edge – Honda’s Five Why’s; Wheelwright & Clark,Revolutionizing Product Development – “Types” of development plans;Slywotsky, Profit Patterns – Business model redesign as a strategic response; Porter, “What is Strategy?” in On Competition – Model redesign and unique activities; Brown and Eisenhardt, Competing on the Edge – The idea of “probes.”

The list could go on.

Finally, the strategy professional will be pleased with the checklists and questions (called “quizzes”) that the authors provide. Some of the very best of these, in my opinion, are:

Sample Questions on Buyer Behavior (pp. 51-52); Is There Potential For Radical Reconfiguration of the Current Business Model? (p. 96); Assessing Market Uncertainty (p. 174); Assessing Technical Uncertainty (p.175); Sources of Competitive Insulation (p.190-191).

In addition, there are many templates to for “mapping” strategies that are quite useful. The notion of “leading indicators” of project progress is a marvelous idea – reminiscent of the principles that Norton and Kaplan have enunciated in their various writings on leading and lagging performance metrics and the Balanced Scorecard.

As a strategy professional, I must admit to one basic reservation about the process described in this book. I cannot imagine how to get a group of busy managers to take the time to do all of these steps in this quantity of detail. There is no doubt in my mind that The Entrepreneurial Mindset presents an ideal way of going about strategy development and selection at the business level. In fairness, the authors point out many cases in which one should modify the process to reflect local custom. Even then – in the absence of some extreme strategic crisis – maintaining interest in and motivation around so exhaustive and elaborate a process rates to be a huge challenge.

The bottom line – It’s a relatively technical book aimed at those responsible for strategy development at any level. It does a wonderful job of laying out the details of an exciting process through project implementation. It’s a “must read” book because it integrates many current ideas and techniques so well. It’s a two-read book. (Actually, I’m on my third time through at the moment.) But it’s well worth it.

Bob Nickels01/15/01

Product Description
A Blueprint for Building Entrepreneurial Organizations
Nobody needs to tell you that in the new economy, managers using conventional strategies are losing out to smart, fast, entrepreneurial competitors who move on ideas others overlook and who confidently act while others dither.Are the managers of leading companies simply doomed to let this happen?Not at all, argue Rita Gunther McGrath and Ian MacMillan.The fundamental problem is that the tools, training, and conceptual frameworks that work for business-as-usual can’t, and don’t, work when your main challenge is to bury old business models and aggressively create completely new ones.To succeed, today’s strategists need the thought process and discipline that are second nature to successful entrepreneurs. The Entrepreneurial Mindset offers a refreshingly practical blueprint for thinking and acting in environments that are fast-paced, rapidly changing, and highly uncertain. It provides both a guide to energizing the organization to find tomorrow’s opportunities and a set of entrepreneurial principles you can use personally to transform the arenas in which you compete.

Using lessons drawn from leading entrepreneurs and entrepreneurial companies, The Entrepreneurial Mindset presents a set of practices for capitalizing on uncertainty and rapid change.Like McGrath and MacMillan’s bestselling Harvard Business Review articles, such as “Discovery-Driven Planning,” the book provides simple but powerful ways to stop acting by the old rules and start thinking with the discipline of habitual entrepreneurs.

The Entrepreneurial Mindset will show you how to:
* Eliminate paralyzing uncertainty by creating an entrepreneurial frame that shapes a shared understanding of what is to be accomplished and what would be worthwhile
* Create a richly stocked opportunity register in which you mobilize great ideas for redesigning existing products, finding new sources of differentiation, resegmenting existing markets, reconfiguring market spaces, and seizing the huge upside potential of breakthroughs
* Build a dynamic portfolio of businesses and options that continuously move your organization toward the future
* Execute dynamically your ideas so that you can move fast, with confidence and without undue risk
* Develop your own way of leading with an entrepreneurial mindset to create a vibrant entrepreneurial climate within your organization

The Entrepreneurial Mindset is about succeeding in an unpredictable world. It will help everyone from independent entrepreneurs to managers of large corporations develop insights that others overlook and act on them to build the truly entrepreneurial organizations of the future.

About the Author
Rita Gunther McGrath is an Associate Professor at the Columbia University Graduate School of Business. Ian MacMillan is the Fred R. Sullivan Professor of Entrepreneurship at The Wharton School, University of Pennsylvania.

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