Entrepreneur vs manager of a large organization

by Ashvini on August 16, 2010 · 1 comment

in Entrepreneurship

Entrepreneur vs manager of large organization

Large organization and entrepreneurial ventures are two totally different horses to ride on. Both have their own unique strengths and weaknesses. While large organizations can make things work because of their sheer size, they fall short when it comes to experimentation and flexibility. Entrepreneurial ventures can move faster than large organization but lack resources to a to streamline their processes.

Entrepreneur vs manager of large organization

If you are a manager who plans to become an entrepreneur or vice versa, you need to know what are the advantages each has in terms of resources at hand, flexibility and job role .

Differences w.r.t. a well defined processes vs flexibility

While a manager of a large organization has definitely more resources at her disposal, her hands are tied when it comes to flexibility and adaptability. Most of the time she is hampered because she has to follow each and every processes of the organization to do her job. For e.g. if she needs to hire new employee, she needs to approach human resource department. If she wish to purchase something for her project she will have to go to purchase department. With so many processes, often a manager of a large organization will find her job frustrating and difficult.

On the other hand a manager of the large organization need not have to worry about the nitty-gritty of the process once she sets them off in motion. That eventually means she can execute complex projects free from worry of handling procurement or hiring.

An entrepreneur is the know-all and do-all of a project. Since she has a small team, she needs to focus on the essential tasks and a large portion of her time gets spent on solving the day to day problems. Due to almost non existent processes, an entrepreneur cannot delegate any functions to any department.

Customer handling and satisfaction

A manager of large organization is evaluated on organization specific parameters when it comes to customer satisfaction. She might not have enough room to satisfy all customer needs because of them. The customer too will not have upper hand as they are dealing with organization almost the same size or sometimes more. Customer satisfaction here would mean sticking to specifications and completing everything on time.

An entrepreneur, being very flexible and adaptive, will quickly move to resolve any customer issues. She will be able to delight customer as she will strive to do more than what customer expects.

Career growth and salary

For a manager of a large organization, there is a certain career path. Salaries are guaranteed at the end of the month. However promotions are time bound and career growth can not be explosive.

For an entrepreneur ,career growth is all dependent on the growth of the venture. If the venture succeeds entrepreneur gets rewarded by lots of money(shares in the company) and premier positions(CEO, chairman). However, if the venture fails, it may lead to loss of money and bankruptcy. She then will have to start from the scratch.

Problem solving vs delivering

Manager of large organization is more concerned about delivering in specified budget, time and quality. She is more of a facilitator and coordinator rather than a problem solver. She manages large team and handle complex interactions and communications between teams and it member. The main problem solving she does is removing bottlenecks in communication.

An entrepreneur has a lot of more challenges and issues to handle. She is not only the facilitator but sometimes problem solver, a hands on kind of person. Since her team is small, she has to take care of more than just communication and it does get challenging at times.

To summarize the entrepreneur vs manager of large organization discussion, let us look at the essential differences between an entrepreneur and a manager of large organization.

Manager of a large scale organization:

Advantages:

Project Execution, knowledge aspect

  • She has sizable company resources at disposal
  • She manages large sized teams, interact with big clients and gain better professional experience than an entrepreneur
  • She handles complex and projects across geographies and is better equipped to handle cross functional and geographical teams.

Salary, career and growth aspect

  • She has more certainty of the employment
  • She has more learning opportunities from her organization
  • She has fixed and easy to understand career path
  • Like any other employee, she gets a salary at the end of every month

Disadvantages:

Project Execution aspect

  • She is confined to more or less one or two areas of expertise
  • Large bureaucracy of organization sometimes become a challenge
  • She cannot experiment a lot with processes and products offered by her organization

Salary, career and growth aspect

  • Time bound promotion
  • Predetermined increase in salary and bonuses
  • Restrictive corporate environment that subdues creativity and risk taking
  • Mostly repetitive work

Entrepreneur:

Advantages:

Project Execution aspect

  • Can design and modify products and processes at will
  • Can delight customer with extra goods or deliveries
  • Flexible and adaptable

Salary, career and growth aspect

  • Salary comes very late, only when organization is profitable
  • Makes a lot of money if venture is successful
  • Growth is explosive. On success, she may become CEO or chariman

Disadvantages:

Project Execution aspect

  • Non-existing processes can hamper project
  • Time spent on solving day to day problem
  • She needs to focus on non-essential tasks such as procurement, hiring, finance which are taken care of by departments in large organization

Salary, career and growth aspect

  • Most of the time her personal money is on the line
  • Too many challenges can cause burnouts
  • Spends lesser time spent with family initially
  • Salary is not guaranteed

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