Cultivating Entrepreneurial Thinking in Challenging Times

With economic headwinds challenging organizations worldwide, the question of how to maintain high performance with fewer resources is top of mind. Organizations must find new strategies to ensure sustainability, creativity and exceptional service delivery, all while managing with reduced resources.

In this video, Matthias Spitzmuller, associate professor of organizational behaviour at Smith School of Business, addresses how companies can successfully navigate these difficult times. Spitzmuller draws on his extensive experience teaching executives and consulting with large organizations to explore the concept of “doing more with less.” He underscores that this strategy is often misunderstood and, when implemented poorly, can lead to employee burnout and disengagement. However, when executed effectively within a supportive culture, it can empower employees to adopt an entrepreneurial mindset and find innovative solutions to challenges.

Spitzmuller also shares practical strategies for creating a culture that values support, collaboration and innovation. His insights provide a framework for leaders looking to empower their teams and drive sustainable success, even in the face of economic adversity.

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Matthias Spitzmuller

00:06: What does the concept of “doing more with less” mean?

We’re living in a time right now of budget cuts and of economic headwinds, where organizations are struggling to make ends meet. This raises the question: How can we still provide exceptional service with less economic means?

The idea of “doing more with less” can easily be misunderstood and also abused in many organizations. I’ve seen this when I’ve taught executives of larger firms and told them, “you don’t need to give your employees more resources, and they need to accomplish more.” Their eyes light up, and they’re like, “Excellent! Brilliant! This is exactly what we need.” But what they misunderstand is that you have to create the right environment in which this is effective.

This happens when you have this culture of support, a culture of experimentation. But if you use it just as an excuse to cut costs without providing the support mechanisms, then the organization is going to burn out. Employees will be frustrated. You’re not going to be able to accomplish the entrepreneurial goals and aspirations that you set out to revitalize with these initiatives. 

01:28: How can leaders encourage creativity and growth when resources are limited?

To answer the question, I’d like to walk through what I see as the normal progression of an organization, from the startup to maturity, and try to understand what happens with an organization as they grow –  how do they lose some of the entrepreneurial spirit in the early times, and how can we bring it back. 

The example that I would like to give comes from the Chinese setting, building on the trajectory of the Huazhu Group. This is a chain of hotels in China. In the early years, there was a very strong founder personality who had a very strong impact on the culture of the organization and on identification of employees with the company. 

As the chain of hotels became larger and larger, a lot of this got lost because not everybody could know the founder any longer. And suddenly, the question was, how can we manage our employees? And what the hotel then did, they added a lot of process controls, meaning every individual knew that these are the KPIs that I have to accomplish to be evaluated positively. 

So, if we take the example of an employee working at reception, they knew that they would be evaluated by customer feedback specifically on their customer service. But what happens in the process of that is that employees care less and less about the performance of the hotel group as a whole and they focus more and more just on their isolated, individual piece of work. 

You can also start to manipulate and game the system. If you work in reception at a hotel, what do you do? Free upgrades for everyone who comes in through your doors. Of course, customers love it, but it’s not good for the hotel. So, the question then for the hotel was, how can we bring back some of that entrepreneurial mindset? 

And what the hotel group did was they emphasized goals that extended beyond the direct sphere of influence of the employees. What this meant is that hotel managers were not only responsible for the performance of their own hotel, but for the performance of a cluster of hotels that they were a part of. And the idea was that you had to come up with ingenious ways of how to solve problems that extended beyond your direct sphere of influence. And I think this is also a method that we can use as we are thinking about doing more with less. 

When we’re dealing with economic scarcity, employees need to find ingenious ways of solving problems and, oftentimes, bringing back the mindset of an entrepreneur. We accomplished this by having a culture in which individuals experience the positive experience of closing that entrepreneurial gap. We need a culture of experimentation and growth, where employees know that we can take risks to close that entrepreneurial gap through our actions and not be penalized if our first attempts to do so fail. 

04:40: How can leaders create a culture of support?

To create a culture of support, I think what organizations need to do is to give employees the experience that investments in their peers, in their subordinates, in the culture of the organization, is valued and rewarded. And if employees experience that, then it becomes contagious. And leaders go a long way in demonstrating those behaviours.