Having a good idea is not the essence of entrepreneurial success

The entrepreneurial landscape is often focused on the pursuit of exceptional ideas. This translates into a process in which the creation of a business requires a great idea, which is then implemented in a so-called execution phase. This is followed by corporate idea contests, “ideation” seminars, and other pointless but fun activities. But if you look at successful companies throughout history, you’ll find that their initial idea wasn’t all that important, and often not all that original. So how does one go about initiating an innovative venture that will thrive?

Ikea is undoubtedly one of the most innovative companies that has revolutionized the world of home furnishings. How did it all start? Well, Ikea started as a grocery store! It was founded in 1943, and it wasn’t until ten years later that it started selling modular furniture. Airbnb’s original idea? Blow up a mattress so a guest could sleep in your living room. Some entrepreneurs capitalize on existing ideas. Before Facebook, there was a social network called mySpace. At first glance, Facebook brought nothing new to the table. Others make more or less the same product as their direct competitor: Pepsi was born a few years after Coca-Cola and has been making a lot of money selling an almost identical product ever since. Finally, “good ideas” are a dime a dozen. We all have several ideas a day, but most of us do nothing with them. Some of us act on them, and that’s what makes the difference. If you think you’ve got a great idea, there are probably 200 or even 2,000 other people in the world with the same idea. You’re not going to win the competition based on the originality of the idea. If not, then what?

Very often I hear the answer “it’s the execution that counts”. So we go from one extreme to the other: from “the idea is everything” to “the idea doesn’t count”. But the distinction between idea and execution does not accurately reflect the dynamics of the entrepreneurial project. It implicitly assumes that the idea does not change. There’s a first sequence in which the idea is produced, followed by a second in which it is implemented. It’s a very Cartesian way of thinking: the idea on one side, the implementation on the other. This is sometimes true of visionary projects: Elon Musk wakes up one day with the idea of sending people to Mars; it’s a very old, banal idea, and he spends the next 40 years of his life trying to make it happen. But there are few projects so clearly defined that the original idea never changes. Instead, the dynamic reality of the entrepreneurial project is characterized by a dialectic between idea and execution. This is especially true when it comes to uncertainty.

To better understand the concept of the idea and make it less sterile, we need to change the way we look at it. An idea is not a work of art frozen at the beginning of the entrepreneurial action and displayed in a showcase, a kind of polar star far away from us, a plan drawn by an architect and then realized by craftsmen. An idea is raw material. It’s on this raw material that the entrepreneur will work. Often the initial idea is very simple (a grocery store!). Sometimes there is no idea at all: Hewlett Packard and Sony, two of the greatest success stories of the 20th century, were created without an initial idea, simply because a few friends wanted to “do something together”. It’s the action that gradually generates an idea, or a fragment of an idea. The idea is therefore much more the product of entrepreneurial action than its starting point. Above all, it evolves over time. The idea for Ikea wasn’t born in one day, but germinated over the course of ten years.

Idea? What idea? (Photo from George Becker on Pexels.com)

How does it evolve? Effectuation, the logic of entrepreneurial action, suggests that the role of stakeholders is paramount. Imagine an entrepreneur with an idea to develop a blue plastic gadget. He’s worked hard on the idea and thinks it’s brilliant. Full of energy, he goes to meet a potential customer. The customer says, “I really like your gadget, but I’d like it in green and wood”. The entrepreneur has four options: he can conclude that this is not the right customer for his gadget and try to find another one (segmentation approach); he can act like a visionary and try to convince the customer that he is mistaken and that what he really needs is a blue plastic gadget. In either case, he refuses to change his mind.

Or the entrepreneur may decide that, since “the customer is king,” he will modify his product and return to the customer as soon as possible with a green wooden gadget (adaptation approach). He accepts to change his idea to adapt to the customer’s demand. Finally, the entrepreneur may sit down with the potential customer and discuss what they could do together. After this discussion, they may decide to make a red metal gadget together. Here the idea is co-created. The entrepreneur commits to making it happen, while the customer commits to, say, buying 10 in advance or providing the necessary metal for free. Once this is achieved, the entrepreneur begins the same process again. Here, the idea is the product of the entrepreneurial process. In effectuation terms, the idea is like a quilt made up of different pieces of fabric, the contributions of each stakeholder. This patchwork is reworked each time a new stakeholder joins the project. This is how the idea evolves over time. This is how a relatively simple idea can become a great idea, iteration after iteration. But with this approach, the “big” idea won’t just be an abstract idea in the entrepreneur’s head; it will already be a social object rooted in reality to which stakeholders have committed themselves. This shows the extent to which action develops the idea, which in turn generates action. This is a far cry from the Cartesian separation of idea and execution. This is creative action.

By this measure, “What is a good idea?” is actually the wrong question. There is no such thing as a good idea per se. An idea is good when it is embraced by stakeholders. Sitting alone in your room with an idea you think is great may be satisfying, but it won’t get you very far, even if it really is.

The originality of an idea is not the primary determinant of success. Entrepreneurial puzzles transcend the notion that a superior idea precedes a robust execution strategy. The dichotomy simplifies a complex reality – ideas morph and evolve through entrepreneurial interaction with stakeholders. These concepts manifest and evolve into tangible contracts, products, services, alliances, and more. The goal is to crystallize the idea into a realized business model. Think of your idea as raw material – a catalyst for action. Let your partnerships intelligently shape and evolve it. Above all, take action, because that is how you navigate the transformative journey from idea to thriving business.

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🇫🇷French version of this article here.

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