It’s a well-known fact that organisations with strong entrepreneurial orientations statistically perform better than those without. They frequently achieve higher levels of productivity, innovation, growth, employee engagement and retention and financial returns.
Although business growth is the overall end game, intrapreneurship can be difficult to achieve. That’s because it challenges traditional organisational practices. Many of the things needed to support the core business are the polar opposite of what’s needed to build a new business. There is no silver bullet to implementing intrapreneurship.
There are however three components that can and do enable intrapreneurship: people, process and place.
- People – leaders that possess a core set of action-oriented competencies and behaviours
- Process – systems and processes that support entrepreneurial thinking and action
- Place – an environment that supports and nurtures entrepreneurship, learning and growth
The goal of intrapreneurship is to build capabilities that enable organisations to accelerate new business growth.
That’s why 65 percent of the top 100 most innovative companies worldwide are implementing intrapreneurship or corporate entrepreneurship.
Let me ask, if a member of staff came and said they had a sure fire way of adding 20% to your bottom line, do you have the processes in place to make it happen? If not your losing…big time!
Embedding entrepreneurship in your organisation can be an effective way to gain a competitive advantage and we know that being more entrepreneurial will help you attract and retain highly talented staff. If done in the right way Corporate Entrepreneurs or Intrapreneurs are the engines of growth in today’s modern organisations. They provide the energy, drive and motivation to help your organisation grow. That’s because they possess a unique combination of competencies, enabling them to work effectively in an entrepreneurial environment. You just have to create it for them to excel.
Innovation is seen as the catalyst to business growth. Despite the hype surrounding it, the failure rate of innovation still remains high. Plus, we know that innovation alone is not enough.
Intrapreneurship provides the necessary infrastructure for successful innovation. Greater levels of innovation yield higher market share, new product revenue, improved profitability, technical dominance, improved process and cost control, and greater shareholder returns.
Unlike a normal start-up that’s created as a stand-alone entity by an entrepreneur, corporate entrepreneurship is created inside an existing organisation. The internal startup.
The traditional organisational practices force the organisation to hold a mirror up to itself to see what it has become or is becoming. It’s not surprising then that embedding corporate entrepreneurship into an existing organisation requires a major transformation. It’s not easy, but it is worth it.
Corporate entrepreneurship requires managing the tension between maximizing profits and developing your staff. Resources and control systems will have to be realigned to support your intrapreneurs.
You will need to develop new practices for evaluating opportunities and managing risk.
Customer intelligence will become ‘baked into’ your decision-making process. There will be a shift in traditional and rational approaches to hiring. You will need to find new ways to maintain the entrepreneurial behaviour needed for competitive success.
Corporate entrepreneurship is not included in most of the theories, models or frameworks that have been developed to guide managerial practice. There is a limited understanding of the relationship of entrepreneurship to change, creativity, and innovation, the building blocks of corporate entrepreneurship.
Leaders typically find themselves in choppy waters and lack the guidelines or knowledge on how to direct or redirect resources toward entrepreneurial strategies. Traditional management practices don’t apply. Entrepreneurial leadership requires a shift in thinking and behaviour. There is often a lack of entrepreneurial role models at the senior management level to provide direction. It’s not a lack of talent but a lack of experience with these types of entrepreneurial skills that is missing.
Entrepreneurship can be extremely threatening to the people that carry out the work.
Most of the research on individual characteristics and behaviours has been done on start-ups and independent entrepreneurs. There is currently no consensus in the academic and business world about what makes a good corporate entrepreneur. Corporate entrepreneurs and entrepreneurial leaders are a hidden talent in many organisations. You have to find them!
Corporate entrepreneurship will vary depending on the type of initiative, new business, product or service, or process. You will be developing the process as you move forward. There are a number of different obstacles and hidden barriers you will encounter along the way. You will have to find ways to work with and around existing systems and processes. No two initiatives will be the same.
Time to take a break, we will carry on next time and explore the world of Intrapreneurship.
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Have a great day and watch out for the next article.