Unleashing entrepreneurship: Breaking the shackles of an outdated mindset

“It takes a dog, a chair and a computer to be part of the global economic order. The dog to wake you up, the chair to sit down on and the computer to log-in.”

— Ben Verwaayen (former CEO British Telecom)

While the above is meant to be deliberately provocative it must be recognized that it would be hugely optimistic to think that in the prevailing circumstances all or even a majority of the young people of this country can adopt this wake-up call.

It is therefore addressed to those who CAN BUT who unfortunately are being engulfed into a system which blinds them to their real potential to create a better life for themselves and contribute to the well-being of the people of Mauritius.

The Need for Entrepreneurial Culture

There are many initiatives which need to be taken for Mauritius to achieve its objective of leaping from the status of an emerging economy to that of a middle-income developing country. Among those, one of the most pressing is the need to inculcate an Entrepreneurial Culture among the population especially our younger generations. Several mega trends in the global, regional and national economy presently favour the emergence of a new ecosystem in which entrepreneurs will prosper.

These are, among others, rapid technological changes especially in communications technology, globalisation and the constant flow of information and opportunities for cross fertilization of ideas and the opportunities which are coming knocking at our doors as Africa becomes the next frontier for development.

While the existence of such objective conditions will certainly prompt the emergence of a few new entrepreneurs and may stimulate a more entrepreneurial culture among existing enterprises, they are far from enough for bringing about the kind of mushrooming of entrepreneurial talents which is needed to significantly change the development trajectory of this country.

The literature on the subject of what is required to stimulate the emergence of a national entrepreneurial culture is very rich. The only point of convergence seems to be that there is no recipe or one-size-fits-all approach for achieving it. Unsurprisingly it has also been observed that new entrepreneurs generally tend to come from families or groups of people who are already involved in some form of entrepreneurial activity. In fact this is why in casual conversations there is a tendency to identify particular groups or “clans” as “natural” entrepreneurs.

In fact deeper investigations almost always lead to the conclusion that some historical and specific circumstances have led these communities to cultivate this type of behaviour often as a matter of survival in a hostile environment or to take advantage of a one-off opportunity. Transmission of values and habits, which are self-reinforcing, are then assured through traditions and customs.

Without engaging in a debate about the role and weight of innate qualities or personality traits in the determination of entrepreneurial skills, it is quite clear that the learning process and family values are a critical part of inculcating the entrepreneurial culture in young people. It is therefore all the more necessary for parents who are not themselves entrepreneurs to consciously avoid adopting attitudes and values which will tend to stifle any nascent such qualities among their children.

The Role of Policy

Government must adopt policies for promoting the growth of an entrepreneurial culture in the country. Such policies aim at creating a supportive ecosystem along essentially three dimensions: the people, the regulatory and legal frameworks and the infrastructure.

As far as people are concerned, it is more a question of breaking down barriers in the formal education systems at secondary and tertiary levels between “learning” and personal development especially as regards inculcating a spirit of self-reliance. Studies carried out by several institutions in India have identified some common patterns that unleash entrepreneurship in young people. Thus it is critical for young people to interact with entrepreneurs and investors. Academic institutes must offer comprehensive programmes, with exciting and innovative curricula and teaching methods.

The Regulatory and Legal frameworks in any country can be either stifling or supportive of entrepreneurship development. The efforts at improving “ease of doing business” supported by the World Bank at the national level are a move in the right direction although, to state the truth, would-be entrepreneurs often complain that there is no obvious correlation between the stated improved performance under that score and ground realities. As part of its policy initiatives, government must consciously design policies in such a manner as to pose the least constraints on entrepreneurship development.

Finally regarding infrastructure there is a dearth of institutions dedicated to training and education in entrepreneurship. As suggested above, existing tertiary educational institutions such as the University of Mauritius or the University of Technology could develop specific curriculum to that effect as part of their programmes of studies.

An interesting development in the recent past has been the setting up of a few “incubation centres” where fledgling entrepreneurs are given an opportunity to nurture their business concepts in a conducive environment. The experience with those centres has been positive if only because all of them are fully operational and have produced some successful business start-ups.

Having said that, however, one of the lessons which have been learnt from the experience is that there is a definite space for private sector companies to set up and run such centres. Government would do well to explore ways and means of encouraging private companies into such activities which have a potential for developing a regional dimension.

Creative Destruction

In conclusion, it might be useful to put all this in context. Mauritius is going through this very delicate stage of transition which has been aptly described as a time when “acceptable ideas are competent no more and competent ideas are not yet acceptable.” The old order and classic economic policies are unable to provide the solutions for the challenges which we face especially in terms of employment creation and the ever widening gap between the rich and the poor.

In those circumstances it is being suggested here that one of the most obvious way forward is the promotion of an ecosystem which unleashes the full potential of all productive forces. This is well captured in the Schumpeterian concept of entrepreneurship. For Joseph Schumpeter the entrepreneur always tries to carry out new combinations of the means of production which destroy the existing equilibrium. This process of “creative destruction” is central to the function of the entrepreneur in the economic development of a nation.

As the new entrepreneurial combinations destroy the existing equilibrium and create a new equilibrium, the entrepreneur is seen as the prime endogenous cause of development over a period. In modern days one may need to add rapid technological transformations as one additional element of the equation to have a more contemporary view of the power of the “creative destruction” concept and the even more potent role of entrepreneurs in the emergence of a new economic and social order.


* Published in print edition on 30 May 2014

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