There are many people productively driving around in automobiles. And many, perhaps most, of these people don’t understand how an internal combustion engine operates, much less how to design or build one. Similarly, many people are quite productive managers but yet don’t grasp fully the concepts underlying markets. Specifically, how a business generates value in the market for its owners, customers, and other stakeholders.
An entrepreneur is like an engineer. The engineer understands the underlying principles of the combustion engine and so can imagine improvements in engine design that can make the engine more powerful or more efficient. Likewise, an entrepreneur, by understanding how value is created, can improve upon existing business models and in the process create value that previously didn’t exist.
Of course, like all metaphors this one breaks down if taken too far. There is no disadvantage to the driver who doesn’t understand their automobile’s engine. But the manager who understands the role she or he plays in the generation of value for their company cannot help but be a better problem solver.