Intrapreneurship: Intrapreneurship: DevelopingDeveloping

Corporate EntrepreneurshipCorporate Entrepreneurship

The Nature of The Nature of IntrapreneurshipIntrapreneurship

Defining The ConceptDefining The Concept

Recent research has defined corporate Recent research has defined corporate entrepreneurship as a process whereby entrepreneurship as a process whereby an individual or a group of individuals, an individual or a group of individuals, in association with an existing in association with an existing organization, creates a new organization organization, creates a new organization or instigates renewal or innovation or instigates renewal or innovation within the organization.within the organization.

The Need for Corporate The Need for Corporate EntrepreneurshipEntrepreneurship

1.1. Rapid Growth in the number of new and Rapid Growth in the number of new and sophisticated competitorssophisticated competitors

2.2. Sense of distrust in the traditional methods of Sense of distrust in the traditional methods of corporate managementcorporate management

3.3. An exodus of some of the best and brightest An exodus of some of the best and brightest people from corporations to become small people from corporations to become small business entrepreneursbusiness entrepreneurs

4.4. International competitionInternational competition5.5. Downsizing of major corporationsDownsizing of major corporations6.6. An overall desire to improve efficiency and An overall desire to improve efficiency and

productivityproductivity

Obstacles in Corporate VenturingObstacles in Corporate Venturing

• Enforce Standard Enforce Standard procedures to avoid procedures to avoid mistakesmistakes

• Manage resources for Manage resources for efficiency and ROIefficiency and ROI

• Control against planControl against plan

• Plan for the long termPlan for the long term

• Manage functionallyManage functionally

• Avoid moves that risk the Avoid moves that risk the base businessbase business

• Innovative solutions Innovative solutions blocked, funds misspentblocked, funds misspent

• Competitive lead lost, low Competitive lead lost, low market penetrationmarket penetration

• Facts ignored that should Facts ignored that should replace assumptionsreplace assumptions

• Nonviable goals locked in, Nonviable goals locked in, high failure costshigh failure costs

• Entrepreneur failure and/or Entrepreneur failure and/or venture failureventure failure

• Missed opportunitiesMissed opportunities

Adverse EffectsAdverse EffectsTraditional Mgt PracticesTraditional Mgt Practices

Obstacles in Corporate Venturing, cont.Obstacles in Corporate Venturing, cont.

• Protect the base business at Protect the base business at all costsall costs

• Judge new steps from prior Judge new steps from prior experienceexperience

• Compensate uniformlyCompensate uniformly

• Promote compatible Promote compatible individualsindividuals

• Venturing dumped when Venturing dumped when base business is threatenedbase business is threatened

• Wrong decisions about Wrong decisions about competition and marketscompetition and markets

• Low motivation and Low motivation and inefficient operationsinefficient operations

• Loss of innovatorsLoss of innovators

Adverse EffectsAdverse EffectsTraditional Mgt PracticesTraditional Mgt Practices

Reengineering Corporate ThinkingReengineering Corporate Thinking

• Set Set explicitexplicit goals goals

• Create a system of Create a system of feedbackfeedback and and positivepositive reinforcementreinforcement

• Emphasize Emphasize individual responsibilityindividual responsibility

• Give Give rewardsrewards based on results based on results

Innovative PhilosophyInnovative Philosophy1.1. Encourage actionEncourage action2.2. Use informal meetings whenever possibleUse informal meetings whenever possible3.3. Tolerate failure and use it as a learning experienceTolerate failure and use it as a learning experience4.4. Persist in getting an idea to marketPersist in getting an idea to market5.5. Reward innovation for innovation’s sakeReward innovation for innovation’s sake6.6. Plan the physical layout of the enterprise to encourage Plan the physical layout of the enterprise to encourage

informal communicationinformal communication7.7. Expect clever bootlegging of ideas – secretly working on Expect clever bootlegging of ideas – secretly working on

new ideas on company time as well as personal timenew ideas on company time as well as personal time8.8. Put people on small teams for future-oriented projectsPut people on small teams for future-oriented projects9.9. Encourage personnel to circumvent rigid procedures and Encourage personnel to circumvent rigid procedures and

bureaucratic red tapebureaucratic red tape10.10. Reward and promote innovative personnelReward and promote innovative personnel

Specific Elements of a Corporate Specific Elements of a Corporate Intrapreneurial StrategyIntrapreneurial Strategy

• Developing the VisionDeveloping the Vision

Shared VisionShared Vision

BelongingBelongingHaving a purposeHaving a purposeBeyond the dailyBeyond the daily

workwork

RelationshipsRelationshipsMutual trust and aMutual trust and a

supportive basic attitudesupportive basic attitudeprevailprevail

CommitmentCommitmentActive, committedActive, committed

participation ofparticipation ofemployeesemployees

StructureStructureLocal initiative andLocal initiative andcentral synthesiscentral synthesis

MissionMissionandand

VisionVision

Specific Elements of a Corporate Specific Elements of a Corporate Intrapreneurial StrategyIntrapreneurial Strategy

• Developing the VisionDeveloping the Vision

• Encouraging InnovationEncouraging Innovation– Radical innovation is the launching of inaugural Radical innovation is the launching of inaugural

breakthroughsbreakthroughs– Incremental innovation refers to the systematic Incremental innovation refers to the systematic

evolution of a product or serviceevolution of a product or service

3M’s Innovation Rules3M’s Innovation Rules

• Don’t kill a projectDon’t kill a project

• Tolerate failureTolerate failure

• Keep divisions smallKeep divisions small

• Motivate the championsMotivate the champions

• Stay close to the customerStay close to the customer

• Share the wealthShare the wealth

Specific Elements of a Corporate Specific Elements of a Corporate Intrapreneurial StrategyIntrapreneurial Strategy

• Developing the VisionDeveloping the Vision

• Encouraging the InnovationEncouraging the Innovation– Radical innovation is the launching of inaugural Radical innovation is the launching of inaugural

breakthroughsbreakthroughs– Incremental innovation refers to the systematic Incremental innovation refers to the systematic

evolution of a product or serviceevolution of a product or service

• Structuring for an Intrapreneurial ClimateStructuring for an Intrapreneurial Climate

““Corporate Entrepreneurship Corporate Entrepreneurship Assessment InstrumentAssessment Instrument(measured key entrepreneurial climate factors)(measured key entrepreneurial climate factors)

• Management SupportManagement Support

• Autonomy/Work DiscretionAutonomy/Work Discretion

• Rewards/ReinforcementRewards/Reinforcement

• Time AvailabilityTime Availability

• Organizational BoundaryOrganizational Boundary

Specific Elements of a Corporate Specific Elements of a Corporate Intrapreneurial StrategyIntrapreneurial Strategy

• Developing the VisionDeveloping the Vision

• Encouraging the InnovationEncouraging the Innovation– Radical innovation is the launching of inaugural Radical innovation is the launching of inaugural

breakthroughsbreakthroughs– Incremental innovation refers to the systematic Incremental innovation refers to the systematic

evolution of a product or serviceevolution of a product or service

• Structuring for an Intrapreneurial ClimateStructuring for an Intrapreneurial Climate

• Developing Venture TeamsDeveloping Venture Teams

Developing Venture TeamsDeveloping Venture Teams

• A venture team is composed of two or more A venture team is composed of two or more people who formally create and share the people who formally create and share the ownership of a new organization.ownership of a new organization.

• The leader is called a “product champion” or The leader is called a “product champion” or an “intrapreneur”.an “intrapreneur”.

The Interactive Process of The Interactive Process of IntrapreneurshipIntrapreneurshipWho Are Intrapreneurs?Who Are Intrapreneurs?

• Intrapreneurs are sometimes captured by the Intrapreneurs are sometimes captured by the description as “a dreamer who does.” They description as “a dreamer who does.” They tend to be action oriented. They can move tend to be action oriented. They can move quickly to get things done. They are goal quickly to get things done. They are goal oriented, willing to do whatever it takes to oriented, willing to do whatever it takes to achieve their objectives. They are also a achieve their objectives. They are also a combination of thinker, doer, planner, and combination of thinker, doer, planner, and worker. They combine vision and action.worker. They combine vision and action.

The Ten Commandments of an The Ten Commandments of an IntrapreneurIntrapreneur

1.1. Come to work each day willing to be firedCome to work each day willing to be fired2.2. Circumvent any orders aimed at stopping your dreamCircumvent any orders aimed at stopping your dream3.3. Do any job needed to make your project work, regardless of Do any job needed to make your project work, regardless of

your job descriptionyour job description4.4. Network with good people to assist youNetwork with good people to assist you5.5. Build a spirited team: choose and work only with the bestBuild a spirited team: choose and work only with the best6.6. Work underground as long as you can – publicity triggers Work underground as long as you can – publicity triggers

the corporate immune mechanismthe corporate immune mechanism7.7. Be loyal and truthful to your sponsorsBe loyal and truthful to your sponsors8.8. Remember that it is easier to ask for forgiveness than for Remember that it is easier to ask for forgiveness than for

permissionpermission9.9. Be true to your goals, but be realistic about the ways to Be true to your goals, but be realistic about the ways to

achieve themachieve them10.10. Keep the vision strongKeep the vision strong

The Interactive Process of The Interactive Process of Individual and Organizational Individual and Organizational

CharacteristicsCharacteristics

An Interactive Model of Corporate An Interactive Model of Corporate EntrepreneuringEntrepreneuring

OrganizationalOrganizationalCharacteristicsCharacteristics

•Management SupportManagement Support•Work DiscretionWork Discretion•Rewards/ReinforcementRewards/Reinforcement•Time AvailibityTime Availibity•OrganizationalOrganizational Boundaries Boundaries

Precipitating EventPrecipitating Event((Hostility, Dynamism, Hostility, Dynamism,

HeterogeneityHeterogeneity))

IndividualIndividualCharacteristicsCharacteristics

•Risk-taking PropensityRisk-taking Propensity•Desire for AutonomyDesire for Autonomy•Need for AchievementNeed for Achievement•Goal OrientationGoal Orientation•Internal Locus of ControlInternal Locus of Control

DecisionDecisionto Actto Act

Intrapre-Intrapre-neuriallyneurially

Business/Business/FeasibilityFeasibilityPlanningPlanning

IdeaIdeaImplemen-Implemen-

tationtation

ResourceResourceAvailabilityAvailability

Ability toAbility toOvercomeOvercomeBarriersBarriers