This article is for you if you’re either, one, very entrepreneurial and you feel stuck inside a big organization, or two, you’re a CEO trying to figure out how to get over the growth hump you’re experiencing.
Defined:
Intrapreneurship is entreperneurship within an organization. It’s also known as “corporate entrepreneurship.”
Most major organizations have a problem with intrapreneurship because they fear one thing: change. Intrapreneurs are change agents that make it their duty to innovate within the organization. Whether it be the organization’s product or process, they see the opportunity for change.
Organizations like Google and other silicon valley powerhouses have found productive ways to harness the concept and create a culture that towers over many old-school technology giants. It’s, well, fun.
Two Obstacles:
However, there are still two obstacles for the intrapreneur individually: The first is ownership. One of the profound benefits of being an entrepreneur centers around feeling the sense of “owning” what you produce. The second is ability. Many organizations simply don’t allow intrapreneurship. My friend from Goldman Sachs wasn’t allowed to experiment with any outside blogs, ideas or write about strategy topics in the financial arena. Additionally, the culture dictated an unspoken feeling of, “Hey, you want something to change? You don’t like that you have to get outside faxes approved by two people above you? Then get the hell out of here.”
In order for one to be a successful intrapreneur, he or she must overcome both the “ownership” and “ability” obstacles.
OK, so why would I want an intrapreneur in my organization?
Because your company will plateau. It will hit a point where growth isn’t as radical as it has been. This isn’t theory, it’s fact. Business students are fed with the following diagram in virtually every text book:
I like to think of that green line as the intrapreneur’s push. If you set your organization up where the environment is slowly draining the employees, and bars out intrapreneurs, you’re essentially killing your organization. Your giving the organization little chance for the future push to get you over the invevitable hump. Many don’t mind, reasoning, “Hey, we’ll cross the bridge when we get to it.” You can witness this type of attitude with IBM’s recent push to become more innovative. Before, “IBMers” were known as old-school, big blue guys that simply made stuff happen. Now, today, with other technology giants looking more apealing, IBM has had to change their culture–encouraging outside thought and innovation. Or, at least, that’s what they’ve expressed to the media and masses that they’ve done.
Intrapreneurship is a critical component to any organization. You have two choices: you can disregard this fact or you can embrace it, and begin implementing specific values and metrics to encourage corporate entrepreneurship. There are thousands of ways to create metrics to embrace entrepreneurship–it’s all about what your organization elects to do.
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Creating new ideas inside of a big corporation is usually not the problem. The bigger challenge is usually getting those ideas beyond the initial high energy “skunk-works” or prototype phase and into a profitable new product. That is where the corporate antibodies really jump in and try to squash new products and services. There are many factors involved, but I agree that ownership and ability, as you have defined them, are critical. As a new idea grows to the point where it might become a new business, it is often necessary or desirable to transfer ownership or add a new champion to get the resources and management talent needed for the business to succeed. This is also the phase where it becomes more difficult to avoid corporate infrastructure. Systems designed to efficiently turn out the current product become a barrier when you try to apply them to a new product or service. There is no simple solution, but one important factor is to put metrics in place, unique to each new business so that as it grows you can maintain a focus on the most important success criteria for that new idea. You also need to make sure that any existing corporate resources that you are using (sales, service, distribution, etc) are the right match for your new business. Many cool new ideas get killed when you try to load them on a sales force or marketing channel that is not a good fit for the new market or the new solution. Even with big incentives, a bad match will still lead to failures. Use only the core competencies of the parent company that really help the new business and look outside to acquire new capabilities where needed.