5
Developing Employees’ Entrepreneurial Competencies: the Resultant Changes for SMEs

Entrepreneurial dynamism is an essential component of competitiveness among small and medium-sized enterprises (SMEs) in their defense of competitive advantages over one another and is essential in combating the potential stagnation of their habits [BAS 09]. To exist in a competitive environment presupposes that they subscribe to a view encouraging innovation and measured risk-taking. They must make the most of their resources, starting with their employees, by exploiting their technical skill but also their entrepreneurial potential. Within a company, all employees possess capacities and skills hitherto undiscovered [DUR 06]. If it is expected of a welder to exercise the technical skill for which he has been recruited, he may also possess abilities potentially capable of feeding into the entrepreneurial dynamic of the SME, by putting forward improvements on the current model or new ideas. If making the most of the creativity of each employee seems appealing, as demonstrated by Google or 3M, to do this in SMEs is no simple task. To reintegrate an entrepreneurial dynamic in its functioning, its strategy, as well as in its daily implementation, implies the necessity of defining the skills to be acquired and the method by which these skills must be learnt, of thinking about the entrepreneurial self-expression of employees and forming a new idea of the scope of their work: which organizational changes are necessary, what sort of relationships should be prized over others, how can new, sought-after performance be enhanced, how can strategy be redefined, etc. This profound evolution of SMEs supposes a subtle reconfiguration of resources. On the one hand, their reduced size and traditional flexibility would suggest that this evolution is possible, while on the other, an overbearing control of the director or relative lack of resources makes this task much more difficult.

This idea of entrepreneurial redynamization of a company is not new, and the different branches of organizational entrepreneurship, current entrepreneurship, entrepreneurial management, re-entrepreneurship or organizational ambidexterity combining exploitation and exploration have widely explored the interest for business, notably SMEs, to experience permanent re-organization in order to remain competitive. At the same time, and in a line of enquiry originating in the traits approach, entrepreneurial skills have been widely studied [LAV 06], and the benefits of intrapreneurship have been surveyed [PIN 85]. However, the literature remains reticent regarding the development of employees’ entrepreneurial skills in SMEs, as previous lines of thought often presuppose their existence and focus solely on their exploitation for the company. Indeed, if not every employee plans to become a leader in the industry, they can still, like all humans, possess skills making it possible, if they are developed and correctly exploited, to generate innovation and business opportunities. It is therefore necessary to know which skills to work on and how to put in place the conditions necessary to transform of these natural dispositions into true skills with a pragmatic goal in mind. The aim of this conceptual chapter based on a wide overview of literature (ranging from entrepreneurship and SMEs to theories of learning) is to put forward new ways of thinking about the development of employees’ entrepreneurial skills and the adaptations required of SMEs.

In section 5.1, after having specified the nature of the entrepreneurial skills that can be mobilized in the employees of an SME, we hope to shed light on the learning processes necessary for their development. Section 5.2 will contextualize these skills within SMEs and reconcile them with those of the manager. These reflections will lead, in section 5.3, to a presentation of the conditions to implement an entrepreneurial approach in an SME.

5.1. What do we mean by entrepreneurial skills in SMEs

To develop entrepreneurial skills, it is necessary to define their nature and how they can be learned.

5.1.1. The theoretical tenets of entrepreneurial skills

Competency is the ability to mobilize knowledge, experience and know-how [WOL 07] within the framework of an intended course of action and behavior, utilizing resources [DAV 03] to achieve a given task linked to innovation, the creation of value, the detection of an opportunity or the creation of an organization [VER 05]. These sets of knowledge and experience are of course present in the majority of SME employees, and this potential deserves to be studied, invested and exploited. Instrumentalizing these knowledge sets and experience to transform them into skills means first of all questioning their nature. As regards knowledge sets, education sciences have focused on their differentiation, and Mosconi [MOS 98] proposes a four-part typology that we will adapt to entrepreneurship:

  • Theoretical knowledge aims to make entrepreneurship intelligible [ROM 06] by describing it: the characteristics of the entrepreneur, their acts, their approach to creating value. It makes employees more aware and improves the perceived feasibility and desirability of the act of entrepreneurship through better understanding.
  • Procedural knowledge focuses on what must be done in order to be effective, allowing for reflection on entrepreneurial methodology to improve methods and attain better results.
  • Action-related knowledge is directly linked to professional acts and is built through the reflection of employees or a manager on their practices and the lessons gained from this process.
  • Know-how groups together the routines used to finish a particular task. It is the result of regular exposure to situations that are similar to one another.

Developing skills implies being able to use these sets of knowledge to understand various situations and engage in the appropriate course of action. In accordance with contingent elements, experience creates new knowledge either by the accumulation of more and more subtle and better-adapted solutions or by replacement, if previous knowledge is no longer pertinent. In an employee, experience gives rise to new skills in their treatment of information, much like Toutain’s frameworks [TOU 10], in which the individual mobilizes structuring points of reference in order to construct a course of action in a new situation as soon as they recognize this situation to be similar to one they have already experienced. Since each situation is different, people will use a problem-solving strategy they know to be effective. In order to do this, they will mobilize inner resources as well as suitable external resources through the acquired skill of identifying them. The sense in recalling certain frameworks as a way of deciding on a course of action is that these frameworks correspond to courses of action that can then be taken without having to embark on the intellectual process, in its entirety, of appraising a specific situation, with all of the intellectual energy and the efforts that it implies. The frameworks that come from knowledge put into action lead to an experience-driven mode of learning that generates new knowledge and experience.

Competency is the consequence of putting various knowledge sets into action. This experience generates new knowledge but also a means of reflection on potential courses of action (frameworks). Developing skills also changes the employee’s mindset and their perception of their place within the company.

5.1.2. Learning processes and entrepreneurial skills

Developing employees’ entrepreneurial skills necessitates reflection on the learning process. For Kolb [KOL 94], this development is a process rather than a result. Ideas are not fixed but formed and reformed throughout experience, through constant questioning and liberating creativity, decision-making and problem-solving. More precisely, Piaget [PIA 75] puts forward that individuals construct knowledge through their actions, and this construction occurs around two principles that determine the adaptation of their frameworks to the environment: assimilation (new information is incorporated to improve the framework) and accommodation (a new framework replaces or profoundly alters a pre-existing framework). The author speaks of increased balancing to illustrate the reorganization of frameworks to respond more effectively to the constraints of the environment. This process corresponds to the development of know-how, that is to say, the ability to use information and mobilize the necessary resources in order to achieve a precise goal [NYS 93]. For Avenier [AVE 02], “knowledge is made, develops and updates itself in action”. If entrepreneurial competence is the consequence of using knowledge in an experimental problem-solving course of action, its use in the context of SMEs implies rethinking the entrepreneurial education of employees. Beyond the groundings of basic knowledge brought about by a general increased awareness through experience, [GIB 96] proposes an entrepreneurial model that relies on learning through practice, problem-solving within a trial-and-error approach, formal and non-formal exchanges in a third space between members of the SME and outsiders to gather useful information. The development of these skills must be clearly linked to the ultimate objectives of the SME and its stakeholders. This “learning by doing” puts the individual back into a collective whole and presupposes acting autonomously [LEB 05] to solve problems whose particularities are marked by the context and timescale of the SME [TOU 10]. It is a question of linking knowledge with the behaviors to be adopted so that the SME can make the most of opportunities. In line with organizational learning and the learning company [BEL 03], favoring entrepreneurial education in SMEs to develop skills requires adopting a logic that gathers the individual, teams and company structure in a vision of continuous development that the whole company must nourish. Implementing this mode of learning requires four conditions:

  • – The SME must sensitize and then organize the experience of its employees by putting them in situations closer and closer to the business environment to progressively favor the processes of assimilation and accommodation required by the work of problem-solving. This means a true pedagogy of entrepreneurship in SME.
  • – The SME must encourage the construction of knowledge through experience and trial and error.
  • – The SME must accompany the development of the employees’ cognitive mechanisms with reflective breaks and exchanges, making it possible to capitalize on each experience.
  • – The following objectives must be clear: which skills are to be developed, why should this be done, how can this be done according to the situations encountered and what are the stages of the process?

Marked by contingency, these particular skills only have a value in the instant of their application and must be developed and brought up to date through action [BEL 00]. Allowing for the development of entrepreneurial skills is therefore not a one-off event in SMEs, a scheduled brainstorming session, but rather a dynamic space playing host at once to the imperatives of production and determining the next move. This space of exchange, expression and learning is particular to each structure, implying a certain liberty so that each person might be considered as a potential source of opportunities.

If the entrepreneurial learning process, mobilizing knowledge and individual experience in a cumulative process is well illustrated by theory, the SME context implies their collective organization. The aim is not to develop entrepreneurship but to get the best out of employees’ creativity when it comes to problem-solving and the identification of opportunities to further develop the SME. This would require a more precise definition of which skills are sought after and how the SME can offer a space which encourages the autonomy and initiatives of its employees while respecting the imperatives of production.

5.2. How can entrepreneurial skills in SMEs be mobilized?

To assess the development of entrepreneurial skills in SMEs, we propose evaluating which skills must be mobilized in employees and the ways in which SMEs provide a favorable environment for their development.

5.2.1. Complementarity and overlap between the entrepreneurial skills of employees and the manager, definitions and processes

From the traditional model of an SME, where employees carry out the tasks of production or commercialization for which they were employed, to the intrapreneurial organizations in which everyone has the opportunity to develop their own project which is linked, to a certain degree, to the original activity of the company, the flourishing of the employees’ entrepreneurial skills can come in various guises. It is fitting, first of all, to consider which skills we wish to exploit which complement those of the head of the company, the accountable manager, judicially speaking. From all the entrepreneurial qualities and skills to consider, those directly linked to the head of the company’s activity can be dismissed. As shown by Laviolette and Lou [LAV 06], such qualities are managerial, commercial, marketing-related, HRM-related (human resource management) or financial. The skills that must be nurtured are those potentially capable of generating new opportunities and new ways of performing things, as well as those making it possible to pursue and exercise these skills within an SME. For an enterprising SME, it is a question of multiplying the number of players that fit this description and allowing them to express themselves in the company and facilitate a collective pursuit of such opportunities. The detection process also makes it possible to develop know-how [MIN 01] and thus bring about more and more effective responses, all the while improving the execution of existing methods.

The idea is that employees come to the support of the manager at phases during which new opportunities are being identified, and when a response is being formed which is acceptable in terms of the current market (Figure 5.1). They must therefore develop creativity, problem-solving, teamwork, interpersonal skills and, more indirectly, traits adding to psychological capital such as resilience, optimism, hope and a feeling of self-sufficiency and even emotional intelligence, abilities for cognitive positioning and reflexivity.

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Figure 5.1. Venn diagram of employees, the manager and common entrepreneurial skills

Putting creativity back into the function of employees amounts to (re)integrating them into the entrepreneurial process by producing a certain sort of intention. For Ajzen [AJZ 91], entrepreneurial intention depends on the appeal felt by individuals and the ability they perceive in themselves to carry out the different necessary stages. The information phase (regarding theoretical and procedural knowledge) must not be neglected because it makes it possible to better see the benefit of an approach as well as its feasibility and aids in the construction of an entrepreneurial mindset through sensitization. The employee’s role is to identify and develop the exploitation of opportunities, which implies being attentive to the inner functioning of the company, but also to the ever-turbulent surrounding society with which the employee will be in contact through their personal or professional networks. Through these, the employee may source new methods, inspiration and sources of dissatisfaction. Multiplying these information sources by the number of employees in the SME considerably increases the potential to detect opportunities. This watchfulness must be supplemented by a proactive seeking out of information, the formulation of business proposals and the implementation of new projects.

While sought after by new-generation employees wishing to express themselves within the company, and while theoretically profitable to the SME, the development of employees’ entrepreneurial skills nonetheless presupposes that the company in question is capable of developing them.

5.2.2. Are SMEs ready for the era of entrepreneurial skills?

We have seen that entrepreneurial skills require autonomy and initiative in order to develop. SMEs that wish to move in this direction must be able to organize and enhance the implementation of these skills [STE 86]. For a small-sized organization, this would necessitate an organizational agility [NAG 91], making it possible to ensure customer satisfaction while working on the company’s next move by mobilizing limited resources. An entrepreneurial SME must be able to rapidly reallocate its resources in accordance with changes in priority, all the while maximizing value creation. These behaviors have been observed in “adhocratic” companies or fast-growing companies and more recently in the so-called “liberated” companies [GET 12]. In a traditional SME, entrepreneurial direction is deeply constrained by the limited resources at its disposal [JUL 88], financial resources, human resources and time [LEP 05]. A lack of time leads participants to privilege the central functions of their job above all other activity. A lack of financial resources limits the company’s capacity to invest in domains judged to not be strategic or vital. Finally, a lack of human resources strongly limits all the ability for action and the carrying out of “interrelated” projects. Generally, these constraints translate to limited capacities for anticipation and action as regards all that which does not directly pertain to the central function of the company on which its competitive advantage is based. The centralization of power is also an impediment to innovation [JUL 02].

Nonetheless, SMEs can take advantage of the polyvalence of their workforce and of their organizational and strategic flexibility, in order to innovate [COR 13]. According to [ROT 78], innovation in SMEs derives from their ability to react to a changing environment, the flexibility of internal communications and, more generally, the entrepreneurial dynamic, resulting from a reduced level of bureaucracy and more reactive management tendencies. Their proximity to the market allows them to harmoniously evolve by virtue of responses often built in tandem with demand. This proximity is also present in the search for resources through collaboration with competing SMEs in order to share sourcing outlets. According to Torrès [TOR 00], this proximity is internally echoed across temporal, spatial, hierarchical and functional levels and makes it possible to combine different viewpoints and expertise with the view of creating new products or processes, which alleviates the internal absence of specialists by making the most of networks. This proximity is sufficient reason to envisage the development of entrepreneurial skills in SMEs because they are linked to flexibility, interactivity and adaptability.

If at first glance, SMEs offer a favorable environment for the development of employees’ entrepreneurial skills as a result of these numerous and immediately beneficial proximities, not all of these businesses function on the same basis, and innovation, proactivity and risk-taking therein are not always found in the same quantities. When we want to consider an entrepreneurial SME as a space where the potential of each employee can be exploited, we have to take into account the particularities of the company, its employees and its stakeholders.

In order to develop employees’ entrepreneurial skills, when faced with the necessity of SMEs to be immediately productive as well as the necessity in business of anticipating changes in the environment, we must undertake a carefully thought-out reconfiguration of the very structure of an SME to unite its current economic performance and the potential for future development.

5.3. The managerial consequences of developing employees’ entrepreneurial skills in an SME

Making the transition to a structure that allows for the expression and development of employees’ entrepreneurial skills necessitates the modification of five of the characteristics of a traditional SME in its functioning [TOR 04]: openness of the director, entrepreneurial culture, mindset of employees, organizational structure and human resources management (HRM).

5.3.1. The presence of an open director

Numerous writers such as [BRU 93], when they speak of the indissoluble bond between a company and its creator, speak of the two as a dyad, of their relation as being dialogic, and of their inherent similarity. The directors of SMEs have a strong influence on the organization through their vision, values, their way of communicating and their managerial methods, to the point that the company’s structure appears to be a personified organization. Rethinking the place of the director and the employees presupposes first and foremost the presence of an open director. It is this openness that will allow directors to take a step back from their activity, their exertion of power, their decision-making abilities, their style of management, their perception of risk, their tolerance of others and their self-expression. They must realize the benefits to be had in encouraging and inciting entrepreneurial behavior in others and developing these behaviors – in other words, “liberating” the company from their total control.

Nonetheless, all research on the director’s role in an SME suggests that this evolution is not simple. Firstly, on a psychological level, being a director is refusing to submit and using all of one’s strength to ensure the continuation of one’s own power. Giving up the pleasure of controlling the entire company, loosening the bond between self and the organization that the director has created, and directs and controls, is a major step, the success of which resides in the director’s ability to share certain functions. Even if they reserve their power of veto, it is expected of a director that they communicate and share a vision of the company and the common values they must share with their employees: the conditions of involvement, functioning, the rules of life within the company, etc., which together make up the environment in which entrepreneurship can exist. It is also expected of them to assist their employees to be autonomous, allowing them to take back ownership of their own work. The director must accept and value the creativity and innovation of employees to encourage them to put forward proposals to change what it would be best to change, even if this takes the company in a direction the director had not envisaged.

The relationship with innovation is not the same in all directors. For Miles and Snow [MIL 78], some are pure innovators, looking for new solutions, while others are mere followers; innovators prefer developing ideas while followers prefer to imitate reactively and are therefore more passive on a case-by-case basis. If the motivation behind developing and encouraging an entrepreneurial dynamic differs from one company’s director to the next, the psychological crux of openness consists of welcoming surprise, valuing experimentation rather than punishing failure, liberating creativity and considering each employee as an entrepreneurial player (visionary, innovative and risk-taking) rather than a mere agent of the director’s will.

5.3.2. A new culture asserts itself

Developing the entrepreneurial skills of employees only makes sense if they can perceive the possibility of acting as entrepreneurs and of sharing a culture which Johannisson [JOH 84] defines as a system of beliefs and common values that give members of the SME a common vision of the world. The development of this culture requires an organization that lends itself to searching for new opportunities and valuing the personal characteristics associated with entrepreneurialism (individualism, the need to concretize ideas, or risk-taking) and personal success while all the while tolerating failure, diversity rather than uniformity and change rather than stability [JOH 84]. This entrepreneurial culture must be linked back to the entrepreneurial learning processes [GIB 96] used to generate the expected skills. This culture must favor these sorts of learning processes by putting them into practice, through reciprocal teaching and learning by one another and through exchanges, reactive responses within the SME and outside of it, problem-solving and even the benefits of trial and error. The company should then strive after the sort of culture that will favor a penchant for risk, autonomy, responsibility, solidarity and creativity by virtue of its values, rules and working methods. A company is more entrepreneurial when its organizational culture encourages creativity, the expression of new ideas and experimentation wherein all employees might be considered equally as core1 to the company’s success [SAO 12]. The company must try to create the sort of culture that will allow it to exploit its competitive advantage while all the while working on the next step of development. In this contradictory position, the company must facilitate the quest for productivity in order to unlock the potential of its resources and creativity, as well as for research and development. The main problem for such an organization therefore lies in its ability to develop a culture favoring adaptability, forward-thinking that pushes individuals to creatively solve problems, manage risks and make decisions, etc.

Changing the culture of an organization to make it more entrepreneurial requires concretely inscribing these new values into the SME’s characteristics (its symbols, behavior, rituals, history). We must therefore ask which tools should be used to that effect, of which there are many, such as learning through incrementally more ambitious projects (“learning-on-the-job”) to capitalize on small successes and at the same time reducing the fear of failure. It is also necessary to raise awareness among employees in order to encourage positive attitudes toward entrepreneurial situations, recognize the successes of individuals/groups by pointing these out, increase the presence and visibility of entrepreneurial models, value, encourage and help employees to see entrepreneurial skills as a sort of career choice, lead them to freely express themselves, etc. These different elements naturally lead to a culture based on trust and respect in order that a free space dedicated to the pursuit of opportunities might be more effective.

The development of an entrepreneurial culture necessarily involves the construction of an entrepreneurial mindset and a collective sense of efficiency by feeding into the collective will to act and developing the abilities to fulfil oneself within the SME through entrepreneurial projects. This requires the complete support and involvement of employees in the company’s culture so that they adopt this double-edged responsibility: performance in one’s position and creativity, the pursuit of opportunities.

5.3.3. Developing employees’ entrepreneurial intentions: desirability and feasibility

In order to develop these entrepreneurial skills, employees must see the benefit of doing so, must want to do so and see it as feasible – ultimately, to have the intention of doing so. According to Randerson et al. [RAN 13], employees desire innovation and risk less than their managers and prefer avoiding the former situations. This obstacle arises not from an innately reduced inclination toward proactivity but rather from a visible lack of mastery and confidence in such new situations. The development of entrepreneurial behavior cannot be solely achieved by the remuneration of entrepreneurial activities among the employees of a company, but also by the prior development of an entrepreneurial mindset allowing for a progressive engagement in entrepreneurial activity. For Drucker [DRU 85], “Entrepreneurship isn’t magic or mysterious, it has nothing to do with genes. It is a discipline. And as a discipline, it can be learned”. The underlying idea is the demystification of entrepreneurship through knowledge, raising of awareness and methods. In possession of all the facts, the employee is now able to progressively take action to become, going forward, gradually exposed to entrepreneurship, thus allowing him or her to develop the skills necessary for a more and more masterful approach. We have seen that the exploitation of knowledge and experience when building competency only makes sense if the exploitation process is carried out with a certain result in mind. A gradual exposure and training for creative approaches, and for the identification and pursuit of opportunities, makes it possible to instil a culture of entrepreneurship and increase the perceived feasibility of its development, which is necessary to encourage entrepreneurial intentions in employees. This also increases the desirability of doing so for employees, who take a certain pleasure in developing ideas and pursuing them within the collective of the SME. Here, we find an element that enriches work tasks, generating greater involvement and motivation, and more widely speaking meaning, which is what younger generations look for in their work.

To develop entrepreneurial intention, SMEs can take inspiration from university education models by providing their employees with content and tools, allowing them to reposition themselves and progressively become engaged according to their initial personal dispositions. This method of teaching requires further investigation to be relevant to an SME context and can be summed up in three stages:

  • – Increasing desirability and perceived feasibility occur through the raising of awareness and the development of an enterprising mindset linked to action, repositioning employees as a creative force, encouraging them to concretize their ideas, widening their field of activity and engaging themselves more fully within the SME and without. It also means directing them toward the needs of the SME and inciting them to respond to these needs while using innovative solutions which, while of course creating economic value, also create collective, human, ecological or ethical value. All these courses of action are liable to lead employees to demystify entrepreneurship and do away with stereotypes and prejudices that often slow down exchanges between management and employees outside a purely operational context. This assumes a certain openness on the part of employees, a curiosity that can be encouraged by specific content or discoveries, as either a spectator (conferences, company and site visits) or an active participant (company games, fictional and then real scenarios, etc.).
  • – Raising awareness must be accompanied by thematic content designed to enlighten employees and prepare them for action. These elements may be related to the entrepreneurial process or the identification of opportunities, as well as brainstorming techniques, the basis of collaborative work, etc. This content improves perceived feasibility by providing answers as to what entrepreneurship is and how it is done, by taking as a point of departure the current situation and building toward the further strength and development of these skills.
  • – In order to be able to engage action and effectively direct it, employees will need specific tools such as techniques for gathering information, the basics of negotiation, professional communication – in other words, a set of tools of an operational nature allowing employees to more easily glimpse the feasibility of entrepreneurship.

In line with the theory of planned behavior [AJZ 91], this gradual approach aims to increase the feasibility and desirability of the act of entrepreneurship as perceived by employees and to make them more clearly perceive the control it is possible to have in such situations. By taking into account that the culture informs in part the subjective norm, we here find the three factors at the root of intention. The “displacement” necessary to pass from the intention to the act can be envisaged as coming from the manager who, as the instigator of the process, is also its main orchestrator. To achieve this expression of entrepreneurship, indispensable to the development-through-practice of employees’ skills, would require the existence of a temporal and geographic space itself calling out for the organization of the company to be rethought so that entrepreneurship can coincide with the imperatives of productivity.

5.3.4. Organizational change

Developing entrepreneurial skills in an SME means, as we have seen, creating an environment where a classic system that strives for productive efficiency can coexist with a third temporal and geographic space in which employees can progressively condition themselves and thereafter develop their creativity and the pursuit of opportunities in the service of their company. If the flexibility of the SME allows them to behave in symbiosis with their environment, deploying this space for entrepreneurial training and then application requires (1) achieving an increase in productivity to maintain the same level of performance on a smaller timescale and (2) adapting organizational structure to favor the emergence of opportunities for employees, the exchange of information and a decision-making system remaining, naturally, in the manager’s remit, but nonetheless spanning across different projects. This direct management without any marked hierarchical structure is the prerogative of close relationships in SMEs defined by mutual, constant and direct contact [TOR 00]. Increased communication allows employees to understand the whys and hows behind the process of change and to appropriate its content as their own, while having very little influence on the objectives or process of the change. In order to achieve this, open communication and collective learning remain the best methods. To be acceptable, proposed changes must have a certain amount of credibility. This credibility depends on the benefits that employees see for themselves and for the organization.

To become entrepreneurial, the SME must modify its organizational structure to integrate a creative space, improve productivity so that the imperatives of profitability and an investment in creativity can coexist and to develop a communication system that works well, allowing for the democratic treatment of all projects brought up by employees.

5.3.5. From HRM to ERM

To make it possible for both the company’s continued success and the employees’ entrepreneurial self-expression to coincide, it is necessary to rethink the management of these resources. If the initial impulse has to come from the manager, employees’ creativity and the development of their entrepreneurial skills can only be ensured if they are provided with motives clearly intended to stimulate them and recognize individual and collective initiatives [NIZ 00], in other words, through particular HRM practices valuing autonomy and risk-taking [STE 86], and by encouraging mindsets such as creativity, taking the initiative, tenacity, teamwork, the will to express oneself by completing projects, etc. Moving from HRM to entrepreneurial resources management (henceforth ERM) requires practices that will make it possible to unleash entrepreneurial potential, remove obstacles and revolutionize the company’s culture in a lasting and responsible way. This initially means valuing, developing, making more reliable and measuring the effectiveness of entrepreneurial employees, and then identifying high-potential employees, attracting them, developing them and retaining them in the company. By reigniting the dialog between manager and employees, moving from HRM to ERM comes down to rethinking the four axes of social mixing within a company [MAH 98]: enhancement, participation, remuneration and recruitment.

The policy of the manager’s enhancement of entrepreneurial skills translates to the employee’s enrichment through work dedicated to developing knowledge, know-how, social skills, material and psychological comfort at work and by visible social recognition. Putting in place a policy for enhancing entrepreneurial skills (EES) means developing three main axes: (1) the appreciation of colleagues’ qualities and any progress made by them in the development of their skills and performance in fulfilling project objectives; (2) the enhancement of training that responds to both the demands of adaptability made on the company and the legitimate concerns of promotion and personal development. This training can be formal (raising awareness, thematic content), or informal, through the learning method mentioned above; (3) the improvement of work content (via the nature of activities entrusted to employees, a collective defining of objectives) and of the physical and psychological working conditions (good communication, understanding between employees but also with management, organization of work, a company culture focused on common projects, etc.).

To reduce instances of resistance to change and avoid rejection of proposed measures, the approach taken should be balanced between increased participation of employees and direction from management, allowing for a high-performing period of change on the economic front that is also acceptable to employees. The manager can therefore accompany EES with a policy of enterprise participation (EP) which is defined in relation to the distribution of management responsibilities between the manager and the personnel and relies on a management style that is participative (a dialog) and utilizes delegation (decentralization) on a project-by-project basis. This policy can be encouraged by decentralized, lateral and informal communication, and the implementation of structures, facilitating joint decision-making on an operational level, and by breaking down the barriers between the participants involved via the support of a core people. These people will play a double role: on the one hand, they will be a bridge between the director and members of the company in order to spread an entrepreneurial mindset, and on the other, they will be a linchpin in the company, facilitating a greater proximity and better communication between the director and employees.

If it is impossible to enforce the involvement of employees, the only remaining course of action is to ensure that all the necessary conditions are fulfilled. To do so, the director can use a remuneration policy. A motivational system of individual remuneration (fixed or variable) can be negotiated, such as a merit-based system of career progression, a compensation system recognizing risk-taking or profit-sharing practices.

Ultimately, if the director judges the SME to be lacking in the necessary entrepreneurial skills, they can engage in external recruitment. The detection and solicitation of an “entrepreneurial employee” raises questions that go beyond the skills normally required. What strategy should be put in place to attract these entrepreneurial employees? What are the required “social skills”? What basic traits make it possible to recognize the sort of personality desired: autonomous, consensual, creative? In fact, not only will it be asked of candidates to be competent in the central responsibilities of their job, but also to integrate into the entrepreneurial dynamic of the SME. In short, their status changes from that of somebody performing tasks to an employee pursuing opportunities and assuming this responsibility. The skills sought after are highly particular and make it necessary to think about how to attract these new profiles, to rethink their selection and finally to put in place an entrepreneurial socialization by integrating them into the workplace and the third space.

ERM is different, in that it gives more weight to entrepreneurial support policies, starting with enhancement and participation. Developing entrepreneurial skills, favoring the expression of ideas and the pursuit of opportunities, must be enhanced over all levels of the SME to allow employees to persevere in this course of action. Recognition of their efforts is indispensable to making them persist. It also allows for emulation and a collective training dynamic gradually imposing itself on all employees and limiting opportunistic behavior. Democratic expression and concerted choices give meaning to the employees’ work and reposition them within the wider aims of the company. This form of participation helps build toward cohesion, individual motivation, self-esteem and thus engagement in the job and the socio-economic performance of the SME.

5.4. Conclusion

If the development of employees’ entrepreneurial skills seems an appropriate approach to making SMEs more proactive in a turbulent environment, we have seen that this necessitates a profound reorganization to make it possible for creativity and the imperatives of production to coexist. This reorganization repositions employees and the director, rethinks modes of communication and resource management, enhances entrepreneurship through ERM and creates the third space necessary for creativity, learning and the pursuit of opportunities. The expected effects concern the SME’s development, in that it promotes innovation, but also obtains greater efficiency, thanks to a regular questioning of procedures and above all the increased motivation of more autonomous employees who are more involved in the aims of the organization. Moving from HRM to ERM is not a spontaneous process and must be supported by the director and accepted by the employees. ERM must allow core people to direct individual skills in the service of the SME and to coordinate individual actions to give collective meaning.

Depending on the initial situation of the SME (recent or past growth or difficulties), the transition to an entrepreneurial phase must follow the stages of raising of awareness, reinforcement of specific knowledge and learning through practice. We have seen that this development of skills implies seeing the SME differently, down to its culture, with a strong message from the director, a systematic relaying of this message throughout all levels of the company and an ERM able to cope with these evolutions, becoming a strategic axis that synchronizes the employees’ entrepreneurial behaviors with the imperatives of the organization, all the while fanning this new, creative flame. Developing these skills also implies a permanent investment in training and subsequently creation that must be made to coexist within the timescales of production. In any case, much thought must be given to the process to be implemented to transition from a traditional SME to an entrepreneurial SME. The teaching methods we have discussed must allow employees to understand entrepreneurship, see it as desirable and feasible, and to progressively actively engage in it. The development of professional education in entrepreneurship seems an interesting avenue of research to provide SMEs with the tools that would allow them to spark change and mitigate resistance to change, and to train employees and instil in them new competencies.

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Chapter written by Lynda SAOUDI and Stéphane FOLIARD.

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