Tuesday, May 6, 2008

It’s none of my business, but business makes the world go round

In a recently published report by the Global Entrepreneurship Monitor (GEM), a research project run by the London Business School and Babson College in the USA, it was determined that Germans are still rather reluctant when it comes to taking the plunge and starting up their own businesses. Whereas about 12% of Americans started up their own company (or managed one that wasn’t older 3 ½ years), for instance, just a little over 5% of Germans did the same. “Early-stage entrepreneurial activity”, as this is called by the researchers, was actually up from the previous year in Germany, which is a good sign of course, but remains significantly lower than in most of the other countries surveyed. In fact, Germany rated 23rd out of the 35 countries involved.

Are Americans and others more entrepreneurial than Germans by nature? Of course not. But it does appear that countries like the United States, and other traditional immigration countries like Canada and Australia, cultivate an entrepreneurial mentality that is not as widespread here. In other words, less is expected of the state and the corporate world.

The busted new economy bubble a few years back may be partially to explain for this. Scores of small businesses risked everything they had and lost. But attitude appears to play a more significant role here. For the most part, Germans don’t yet see small business like these in a positive light. To this day, permanent staff positions in corporations and government are the more appealing alternative. In other words, job security (or perceived job security) is still das A und O (the fundamental concern, all-important) here. Unfortunately for Germany, and the rest of the world for that matter, it is precisely these types of jobs which appear to be disappearing the fastest in the globalization process.

Germans are still raised to believe that they can best find their luck with a company. The implication that “the company” or “das Amt” (government job) will take care of them their entire lives is still alive and kicking – and “still” true for those with civil service positions (but for how much longer?).

Americans, for their part, have long ago had to accept the fact that these good-old-days are long past and that the only thing that any “permanent” employee can realistically expect is the permanence of change, which will most likely equate to the eventual loss of his job.

German government-funded programs like the state-backed business ventures for the unemployed called Ich AGs (Me, Incorporated) seem to reflect a significant change in the German way of thinking, but the results of this program have been mixed at best and the public remains skeptical. Germans just don’t like risk, it seems, and simple improvements in financing the program, at least for now, will probably not be enough to convince anybody any differently.

But in the long run, whether we like it or not (and none of us like it), global entrepreneurship in a world of globalizations appears to be the only global solution to this global problem. In Germany, I mean.

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