lauantai 16. lokakuuta 2010

New Ownership Paradigm

According to Foucault, things are often defined with their counterparts and the opposition defines the concept. I have tried to define the concept of ownership and the more I study about it, the more complex the concept turns out to be. Inspired by the thoughts of Foucalt, I started to create a new ownership paradigm. Here are some early remarks of it:

  • Legal dimension: Property vs Right
  • Power dimension: Principal vs Agency
  • Society dimension: State vs Private
  • Political dimension: Capitalism vs Socialism
  • Class dimension: Capital vs Labor
  • Psychological dimension: Mine vs Others
  • Resource dimension: Rich vs Poor

What is the opposite of ownership?

It seems to me that the opposite of ownership is actually salary work. As previously stated, I have come to a conclusion that entrepreneurship is the father of ownership. In the beginning there needs to an entrepreneur who creates something that can be owned. Entrepreneurship creates ownership. This links to the philosophy of ownership and ownership theories like John Locke and others who have tried to define the rights of the title of ownership. Only after there is an organization that can be owned there can be salary work. This means that there is a continuum in which entrepreneurship creates ownership and ownership creates salary work. Without entrepreneurship there would be no ownership and without ownership there would be no salary work. Salary work is thus dependent on ownership and entrepreneurship. There needs to be someone who is able to hire people and pay the salary to the worker. This articulation shows that salary work gets its meaning from entrepreneurship and ownership.
The Choice of an Entrepreneur: Are You an Owner or a Worker, or Both?

The figure above clarifies the relationship between an owner and a worker. There are the two extremes and there is a continuum between these two. The role of an entrepreneur in a company falls in between these two extremes. In one extreme, the entrepreneurship is like a worker. This is the case in one man companies, for example. He or she has to know all the tasks in the company and he has to put a lot of work effort to the company. The role of an entrepreneur is really operational in this case.

In the other extreme, the entrepreneur is like an owner. This is the case in many publicly listed companies. The owner has no significant role in the company. He doesn’t have to know anything about the company and its tasks, the organization itself has the knowledge and ability to take care of all. In this case the owner is free to focus on playing golf and enjoying the value added by the company.

I have showed this model to some entrepreneurs and they fully understand my point. Too many entrepreneurs are workers-like and they can’t get rid of the operational issues. It is not necessary wise for an entrepreneur to know all and do all. Typically an entrepreneur is a jack of all trades, master of none. Instead he or she could teach the organization to handle the tasks and make the processes work so he or she could focus more on observation and governance. One could say that “The better the owner, the less he or she is actually needed”. This means that it is a kind of a paradox of an entrepreneur that sticking into operational may limit his or her growth to fully exploit the advantages of ownership. It is also a mental issue, it's not easy to start to trust others, delegate and not always be the best to show example.

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