Entrepreneurship, Management, and the Public Sector.

• Author: Reitano, Vincent
• Position: The Bookshelf

The Lean Startup

ERIC RIES

Crown Business

2011, 336 pages, $28

Public and private organizations can learn lessons from each other by sharing management principles--lean management is a good example. Consider a key point of The Lean Startup by Eric Ries, with its striking relevance to both the public and private sectors: "We have wildly divergent associations with these two words, entrepreneurship and management ... It is time to look past these preconceptions."

Entrepreneurship and management should be part of what motivates employees in any public or private organization. Organizations should consider eliminating the perception that the functional role of entrepreneurs and managers are mutually exclusive. The Lean Startup explains that innovation isn't solely the realm of entrepreneurs, and managers aren't limited to bureaucracy.

The public sector can apply Lean principles can to potentially overcome the bureaucratic barriers that governments sometimes face through innovation and experimentation. With constituents increasingly demanding innovation, and public resources becoming increasingly scarce, the Lean principles Ries discusses can provide governments with new solutions. Lean management fosters the development of experiments to make organizations sustainable. For example, as governments begin to shift toward innovative methods of long-term financial planning with forecasts and risk-based fiscal reserves analysis, they can use some of the lean startup principles in Ries' book to guide their efforts.

VISION

In the first part of the book, Ries argues that "entrepreneurs have been trying to fit the square peg of their unique problems into the round hole of general management for decades." As governments face increasingly complex issues, public employees may be inhibited in forming solutions by a form of bureaucratic management that stifles innovation.

To see government employees as empowered entrepreneurs who have the ability to start solving problems, we need a new way to look at them and what they do. "Intrapreneuers" are the people who produce innovation within an organization, according to Ries. The actions of these employees make them entrepreneurs. Within a government, many people could be thought of as intrapreneurs, particularly as they navigate the implementation of policies and programs--which is similar to entrepreneurial management in that it requires charting an entirely new course.

The third chapter of the book tackles...