Chapter 8

2. Chapter 8 Developing entrepreneurship within organisations

3. Objectives • To understand the entrepreneurial mind-set in organisations • To define the term ‘intrapreneurship’ in enterprises such as companies and public institutions in the Asia–Pacific • To illustrate the need for intrapreneurship and how entrepreneurial management differs from bureaucratic management • To describe the obstacles preventing innovation in enterprises • To highlight the considerations involved in re-engineering business thinking • To identify the relevance of purpose and organisation concepts of an intrapreneurial strategy • To highlight the role of social intrapreneurs in creating shared value

4. Who amongst you … ? • is [or has been] self-employed or has started your own business or a social venture? • would like to be self-employed and independent business owner? • is [or has been] an employee in a business owned by someone else? • is [or has been] a manager in a business owned by someone else? • is [or has been] helping your business owner start up a new venture? • not included above? What are you?

5. Are you a manager, entrepreneur or intrapreneur?

6. When will you be out the door? The eagerness to get out and do your own thing, the frustration of answering to a hierarchical boss, the hunger to strike it rich in business … Rise of the 'intrapreneur', by James Adonis, The Sydney Morning Herald, September 2, 2011 woodleywonderworks, licensed under CC Attribution 2.0 creativecommons.org/licenses/by/2.0/

7. ? Is ‘corporate entrepreneurship’ an oxymoron? Oxymoron is a ‘contradiction in terms’ or juxtaposed elements that appear to be contradictory.

8. The misfits.The rebels.The troublemakers.The round pegs in the square holes. The ones who see things differently. They're not fond of rules.And they have no respect for the status quo. You can quote them, disagree with them,glorify or vilify them.About the only thing you can't do is ignore them. Because they change things. They push the human race forward. While some may see them as the crazy ones,we see genius. Because the people who are crazy enough to thinkthey can change the world, are the ones who do. See also Here’s to the crazy ones & 1984 Superbowl Ad.

9. Pathway: Corporate entrepreneurship Chris Potter, licenced under CC Attribution 2.0 creativecommons.org/licenses/by/2.0/, cropped from original • Carrying on from previous discussion on ‘pathways’ in Chapter 5: • Bootstrapping • Minipreneurship • A new business start-up • Acquiring an existing venture • Buying a franchise • Establishing a social venture • Taking over the family business (covered in Chapter 7) • Corporate entrepreneurship: starting a business for your employer (covered now)

10. We define intrapreneurshipas: • Individual (or a group of individuals), • in association with an existing organisation, • creates a new organisation or • instigates renewal or innovation within the organisation. Arthur Fry, co-inventor-scientist, created Post-it notes Ignacio Palomo Duarte, licenced under CC Attribution 2.0 creativecommons.org/licenses/by/2.0/

11. Dreamers who do • Pinchot describes intrapreneurs as ‘dreamers who do’. • Not necessarily the inventors of new products or services, but the people who turn ideas or prototypes into profitable realities

12. Re-engineering thinking ? If you were in a large organisation, how would you encourage people to have a more ‘intrapreneurial mind-set’?

13. Answer:You need to re-engineer the organisation’s thinking • Need to provide the freedom and encouragement required for employees to develop their ideas. • Managers need to develop policies that will help innovative people reach their full potential.

14. Obstacles to intrapreneurship • Resistance to change in organisations • Corporate bureaucracy that slows down project approval • Refusal to allocate resources to new ideas • Lack of training and support for employees • Low rewards for success coupled with high costs of failure • Performance evaluation based solely on job descriptions The U.S. Army, licensed under CC Attribution 2.0 creativecommons.org/licenses/by/2.0/, cropped from original

15. Proven keys to success in intrapreneurial companies • Atmosphere and vision • Orientation to the market • Small, flat organisations • Multiple approaches • Interactive learning • ‘Gumboot factory’ or ‘skunkworks’ Lockheed Martin’s Skunkworks is the company’s intrapreneurial ‘sandbox’. The name was taken from the moonshine factory in the comic Li’lAbner.

16. Not for businesses only –public sector entrepreneurship • Can the public sector be entrepreneurial? • Police, military, public transit, public roads, public education, health care, government workers, elected officials… ? Elliott Brown, licensed under CC Attribution 2.0 creativecommons.org/licenses/by/2.0/, cropped from original

17. Not for businesses only – public sector entrepreneurship • Public institutions ‘need to be entrepreneurial and innovative fully as much as any business does’. Peter Drucker • It’s not easy considering the entrenched bureaucracies that resist change. • Entrepreneurship is as much a public sector imperative as a private sector one. Elliott Brown, licensed under CC Attribution 2.0 creativecommons.org/licenses/by/2.0/, cropped from original Public sector entrepreneurship: ‘an individual or group of individuals undertaking activities to initiate change by adapting, innovating and assuming risk, and recognising that personal goals and objectives are less important than generating results for the organisation’ –Hisrich & Al-Dabbagh

18. What is intrapreneurial strategy? • Vision-directed, organisation-wide reliance on entrepreneurial behaviour that • purposefully and continuously rejuvenates the organisation and • shapes the scope of its operations through the • recognition and exploitation of entrepreneurial opportunity.

19. Critical steps of intrapreneurship strategy

20. Developing the vision Thomas J. Watson, head of IBM: ‘I think there is a world market for about five computers’. Johannessen, J. A. (1994). A systematic approach to the problem of rooting a vision in the basic components of an organisation. Entrepreneurship, Innovation and Change, March, 47. Reprinted with permission of Springer ScienceþBusiness Media.

21. Encouraging innovation • Radical innovation – launching major breakthroughs • Incremental innovation – systematic transformation of existing products/services Harry S. Dent, Jr (2006). Reinventing corporate innovation. Small Business Reports, June, 33.

22. Structuring the intrapreneurial environment • Each employee is asking: Are the perceived costs and benefits of becoming an intrapreneur worth taking personal risks? • Key environmental factors: • Management support • Autonomy/work discretion • Rewards/reinforcement • Time availability • Organisational boundaries

23. Developing individual managers D@IY3D Abdelmaksoud, licenced under CC Attribution 2.0 creativecommons.org/licenses/by/2.0/ • Senior managers should determine if intrapreneurial behaviours are understood by the firms’ employees. • Executives need to help all parties to understand the value of the entrepreneurial behaviour that the firm is requesting of them as the foundation for a successful innovation. Richard Branson believes in constantly reinforcing the message to his staff.

24. Developing venture teams • A venture team or I-team creates and shares ownership. • It has a budget plus a leader who has the freedom to make decisions within broad guidelines. • Sometimes the leader is called an innovation champion or an intrapreneur. • I-team is a small business operating within a large business and its strength is its focus on design (that is, structure and process) issues for innovative activities. • Similar to ‘collective entrepreneurship’. GreenchoiceForze, Forze I Team from Delft University TigerGen Eco-Racing I-team from University of Missouri

25. What is collective entrepreneurship? • Referring back to our definitions about entrepreneurship … • Reich defines as follows: • ‘…individual skills are integrated into a group … they learn about each other’s abilities … Each participant is constantly on the lookout for small adjustments that will speed and smooth the evolution of the whole. The net result of many such small-scale adaptations, effected throughout the organisation, is to propel the enterprise forward.’

26. Social intrapreneurs • See business as part of the earth’s ecosystem • Understand business priorities as well as environmental imperatives • Often more interested in social change than personal wealth creation • Share personality traits with social entrepreneurs See also Chapter 3 on Social Venturing and Chapter 4 on Social Entrepreneurship. See the exercise ‘Spot the social intrapreneur’ at the end of the chapter.

27. Creating ‘shared value’: moving beyond CSR • ‘Shared value’ –policies and operating practices that enhance the competitiveness of a company while simultaneously advancing the economic and social conditions in the communities in which it operates. • The central premise is that the competitiveness of a company and the health of the communities around it are mutually dependent. Shared value Policies and practices that enhance the competitiveness of a company while simultaneously advancing the economic and social conditions in the communities in which it operates.

28. Key concepts ? (Close your books.) • What are intrapreneurs? • What are social intrapreneurs? • What is the difference between CSR and ‘shared value’?

29. Key concepts • Intrapreneurs: • Not necessarily inventors • Turn ideas and prototypes into reality • Team builders with a strong commitment and drive • Action- and goal-oriented • Optimistic in the face of failure or setback

30. Key concepts • Social intrapreneurs: • The cororateequivalents of social entrepreneurs • Align business and social values • Working inside a large business or social organisation