Entrepreneurship

The campaign launched by President Soeharto yesterday to promote the spirit of entrepreneurship in society has set loose a gush of refreshing air in the direction of the business sector in which, up to now, only rent seekers, opportunists and politically well connected persons seem able to succeed.

The fact that the nationwide entrepreneurship drive was started on Cooperatives Day serves as a reminder to us that the cooperative movement, which is supposed to be the backbone of our economy and the training ground for entrepreneurs in the countryside, has disappointingly remained largely the extension of the bureaucratic machinery.

More than 44,885 primary cooperatives have been set up throughout the country. An impressive record it may seem. But if those cooperatives are stripped of official largess and government sanctioned business deals they will be reduced mostly to organizations of bureaucrats and opportunists who are affiliated with local officials.

The objective of the campaign is undoubtedly very important, especially now when the private sector has come to serve as the engine of economic growth and when the majority of university graduates still prefer to seek paid employment instead of self- employment or entrepreneurial activities.

If we are really serious about promoting the spirit of entrepreneurship in this society, the campaign should be directed at two main targets -- the government sector and the general public.

First of all, the drive should be designed to inculcate the same perception among both the civil servants and the public concerning the basic elements of entrepreneurship: Innovation, productiveness and frugality.

Both "entrepreneurs" and "businessmen" want to make money. The fundamental difference, though, is that an "entrepreneur" sees making money as a means to an end, not as the end in itself. That is why such a person will live a frugal life even after making a lot of money. "Entrepreneurs" thrive on creating new things, even though encountering many risks in that process. They like to relate to people, to feel for people. But to the ordinary "businessman" -- let alone the rent-seeking opportunists -- making big money as quickly as possible is the end. That is why, once they make money, they tend to show off, living a materialistic lifestyle.

Hence, to enhance the spirit of entrepreneurship, it is crucial for the government to develop the kind of regulatory environment that is conducive for innovative and risk-taking people to create things through business enterprises. Officials, or government agencies, should never think of being able to out- think the entrepreneurs making choices on their own initiatives. That means that the playing field should be made as level as possible and the entrepreneurs should be given full freedom to profit from their risk taking endeavors by creating new businesses and new jobs.

But risk taking, innovative entrepreneurs can thrive only in a society which allows people to make honest mistakes. We think we still need to learn to accept business failures made by people who have tried their best as a matter of course, because those with true entrepreneurial spirits are never stopped by failure. Honest mistakes, or failures, are, of course, basically different from dishonesty and manipulation.

In countries where entrepreneurship is well advanced, such as the United States, Japan, Taiwan and South Korea, thousands of businesses fail each month, but almost the same number of new businesses sprout up. That has been possible partly because the publics in those countries do not look down upon people who suffer from bankruptcy. Public opinion instead considers failure a license to try again and again. That, we think, is the kind of public perception and public opinion which should be promoted by the campaign to enhance the spirit of entrepreneurship.