Behruz Mistry BADM 395 Paul Magelli

The Entrepreneurial Imperative: An Analysis

In a post 9/11 America, where it seemed that every competitive edge the United

States had over the rest of the world was economically extinct, Carl Schramm

proposed a thought; in his book The Entrepreneurial Imperative, the former

President of the Kaufmann Foundation talks about many things, but one subject

in particular which he thinks all Americans should heed attention to is the

importance of entrepreneurship. Schramm believes that Entrepreneurship is

Americas single biggest advantage over the rest of the world, and only

continuing what the nation has been great at since its birth, will now save it from

downfall.

Schramm argues that although most Americans have absolutely no conception

about Americas secret weapon, it is the unparalleled skill of American

entrepreneurship that will keep it an economic superpower. Gone are the days,

he believes, that America can thrive economically from technology, advanced

education, or primary manufacturing market share; all those have now been

handed over to other superpowers, such as India and China. This is absolutely

unacceptable to Schramm, a worshiper of the principle of American

exceptionalism, and a believer that America is the country that must carry

democracy and freedom into the world.

The book is not a gentle reminder, however, but a rather rude awakening

towards how America is letting its single biggest comparative advantage slip

away. Through his book, Schramm believes that he can change the way the
Behruz Mistry BADM 395 Paul Magelli

American people run universities and foundations, lead companies, make

personal job decisions, and even conduct their foreign affairs. He argues that his

knowledge will not only change corporations and foundations, but also

everyones lives on a day-to-day basis. The current notion

Schramm defines entrepreneurship as a "process in which one or more people

undertake economic risk to create a new organization that will exploit a new

technology or innovative process that generates value to others". Fortunately, he

says, although entrepreneurship has all but died in the US since the world wars,

it is a subtext of American history and therefore an infinitely renewable

resource. It is the only resource, in fact, that has the ability to combat the

damage done by an era of "bureaucratic capitalism" characterized by big

government, big companies, and big unions. The current structure of public

insulation against economic dynamism, which has been adopted by leftist

academics and traditional democrats, has made the economy more stagnant than

ever.

The author supports his argument by exploring the 4 main factors of the

emerging entrepreneurial economy; start-up businesses, large corporations that

seek to operate in an entrepreneurial way, universities, and government, and

explores how each could aid in reigniting the flame of the American Economy.

In support of start-up business, Schramm claims that the majority of American

employment every year comes from companies that are less than five years old.
Behruz Mistry BADM 395 Paul Magelli

He goes on to insist that most large corporations have succumbed to a process of

creative destruction, and do not promote an environment in which Americans

can work in a creative, innovative, and entrepreneurial way. The key to fighting

this, he says, is to hire corporate managers who understand the cultures of start-

ups, and entrepreneurs who understand the work ethic and labor of corporate

managers.

However, cultivating these types of people is no easy task, which leads to

Schramms exploration of the third factor; Americas universities and higher

education institutions. The author argues that it is the institutions task to

promote dispel the current feeding of social narcissism and instead provide a

sound general education with vocational training in fields such as game design,

alternative medicine, music therapy, teacher licensure, sports and leisure

studies, and marine animal rescue. He goes onto name the four areas in which he

believes the American higher education system has failed its citizens: the lack of

emphasis on science/engineering fields, the creation of studies that give students

anti-business mindsets, extreme costs (this he blames government for), and

using R&D for capital rather than progress. He uses China as an example for the

United States, stating that China graduates six Ph.D.s in the sciences for every

American to receive one.

Schramm concludes his captivating essay by what I believe is the most effective

part of the read; an open letter to the leaders and people of America. It reads as

follows:
Behruz Mistry BADM 395 Paul Magelli

"Implementing your vision [of the Entrepreneurial Society] will lead to

unparalleled levels of domestic prosperity and prove to be the soundest basis for

international economic growth. When in place, it can achieve the most elusive of

goals: a domestic policy that serves as an easily understood foundation for our

foreign relations, one that reflects the noblest aspirations of this country for

expanding liberty for all citizens of the world. You were prescient when you

said, 'Making the Entrepreneurial Society work is America's next and perhaps

last chance to show the world the promise of self-government and what freedom

means to the future of the world....' "

In general, I think Schramm delivers a convincing argument. His analysis of

different sectors of the United States economy, and his reflection of how these

are affected by an increase in entrepreneurship most certainly point towards a

need for change in American mindset. In addition, Schramms use of evidence,

both anecdotal and statistical, shows that each and every American can benefit

from a change in perspective about entrepreneurship, whether on a corporate

level, or in a day-to-day household situation. Only then, will the American

economy respond, and hopefully grow back to and surpass the superpower that

it once was.