1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with...
-
Upload
ronald-flynn -
Category
Documents
-
view
242 -
download
2
Transcript of 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with...
![Page 1: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/1.jpg)
1
‘Corporate Entrepreneurship’
![Page 2: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/2.jpg)
2
Corporate Entrepreneurship
• Introduction – (linking with other concepts of
entrepreneurship)
• Venturing – (company activities)
• Intrapreneurs – (individuals, drivers and barriers)
![Page 3: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/3.jpg)
3
INTRODUCTION
![Page 4: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/4.jpg)
4
Business Life Cycle and Entrepreneurship
Inception
Survival
Growth
Consolidation Maturity
Entrepreneurial ?
New Entrepreneurialstage needed ?
Sales
Time
EntrepreneurialApproach ?
![Page 5: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/5.jpg)
5
Businesses are faced with...
• Changing dynamic markets
• Globalisation
• Shorter product life cycles
• High rates of technological change
• Pressures to reduce costs
• Changes in business organisation (int. & ext.)
![Page 6: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/6.jpg)
6
A Possible Response
• Some large firms responded to the changing environment by addressing their necessary response to working with a dynamic environment involving attitudes to:
– risk
– innovation
– flexible, rapid response
– changes in management and organisation
![Page 7: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/7.jpg)
7
Innovation
Creativity and Innovation are NOT synonymous.
Innovation = Creativity + Invention + Exploitation
Source: Rosenfeld and Serco. 1990
![Page 8: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/8.jpg)
8
Role of Innovation
“An enterprise that does not daily innovate inevitably ages and declines … even in a successful business the disease of bureaucracy and complacency is ever present. (Drucker).
“Firms create competitive advantage by perceiving or discovering new and better ways to compete in an industry and bringing them to market, which is ultimately an act of innovation” Michael Porter. The Competitive Advantage of Nations.
![Page 9: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/9.jpg)
9
Schumpeterian Innovation
• Schumpeter (1934). … By recombining the factors of production to create something new the entrepreneur creates a demand…
• Innovation could take different forms:– Creation of a new or alternative product
– A new method of production
– Opening a new market
– Capture of a new source of supply
– A new organisation
![Page 10: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/10.jpg)
10
• Birkinshaw (2003) identifies four common themes in corporate entrepreneurship.– Corporate Venturing
– Intrapreneuring
– Bringing the Market Inside
– Entrepreneurial Transformation
![Page 11: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/11.jpg)
11
Hierarchy of terminology in Corporate Entrepreneurship
Entrepreneurship
IndependentEntrepreneurship
CorporateEntrepreneurship
After: Sharma and Chrisman (1999)
![Page 12: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/12.jpg)
12
Hierarchy of terminology in Corporate Entrepreneurship
Entrepreneurship
IndependentEntrepreneurship
CorporateEntrepreneurship
Corp. Venturing Innovation StrategicRenewal
Int.. Corp. Venturing Ext.. Corp. Venturing
After: Sharma and Chrisman (1999)
![Page 13: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/13.jpg)
13
Take care!
• (Corporate Entrepreneurship / Intrapreneurship) mean different things to different researchers
• Examples of their use:• The development of an ‘overall entrepreneurial climate
• Intra-corporate venturing
• Development initiatives by employees (often without asking permission)
• Rationalisation of the business– See Carter & Jones-Evans (2000) for further discussion
![Page 14: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/14.jpg)
14
Business Level
VENTURING
![Page 15: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/15.jpg)
15
Venturing
Venture: Chance, luck, hazard, an undertaking whose issue is uncertain or dangerous; an attempt - Chambers Dictionary.
Key Elements:* Risk / uncertainty* Innovation / creativity* requiring striving / reward seeking behaviour.
Corporate Venturing: The creation of new businesses* Making smaller, high growth businesses out of large, mature ones* Utilising Internal organic growth, acquisition, joint ventures or alliances.
![Page 16: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/16.jpg)
16
Why venture?
• Growth
• Improved financial returns (e.g. ROI)
• Image (Corporate renewal)
• Technology pressure
• Diversification
![Page 17: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/17.jpg)
17
Reasons for venturing
Reasons for venturing US Co. Japanese Co.
Maturity of the base business 70 57
To meet strategic goals 76 73
To provide challenges to managers 46 15
To develop future managers 30 17
To survive 35 28
To provide employment 3 24
Source: Zenas Block & Ian MacMillan ‘Corporate Venturing’, Harvard Business Press 1993
![Page 18: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/18.jpg)
18
Policy Ideas - Venturing
MergerExt. Co.
JointVenture
Contractors
Int.venture
Spin out
Acquisition
Suppliers
Buy stake
EncourageEntrepreneurship
ExternalEnvironment
Customers
Takestake
![Page 19: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/19.jpg)
19
Intrapreneurs
![Page 20: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/20.jpg)
20
Intrapreneur
• Used by Norman Macrae in an article in the Economist. (Christmas Ed. 1976). Applied term to managers, professionals and artisans who set up small businesses within old and existing organisations.
• Some texts suggest that Pinchot was the person who first used the term
![Page 21: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/21.jpg)
21
Intrapreneur
• Developed by Pinchot (1986)– “ An intrapreneur is an entrepreneur within an
already established organisation”. Used to describe entrepreneurism within a large organisation, rather than establishment of small businesses within a large organisation.
![Page 22: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/22.jpg)
22
• Gibb (1988) An Intrapreneur is an employee of a large organisation who has the entrepreneurial qualities of drive, creativity, vision and ambition.
• Gibb goes on to state that these people differ from entrepreneurs as they wish to retain the security of the large organisation.
• A number of authors define Intrapreneur and related terms. See Sharma and Chrisman (1999).
![Page 23: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/23.jpg)
23
Intrapreneurs
May have these characteristics in common with independent entrepreneurs
Ability to work amidst confusionAbility to anticipate changeAbility to make intuitive leapsHigh energy levelsCreativity in problem solvingAction orientation
![Page 24: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/24.jpg)
24
….. But want ...
BUT may differ ….
Want less restrictive but supportive environmentWant recognitionWant their ideas to be a vehicle for advancementWant the security (pay cheque, pension etc)
![Page 25: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/25.jpg)
25
Intrapreneurs and entrepreneurs share:.
• Entrepreneurial characteristics• Vision & Flexibility• Action Orientated• Dedicated• Persistent / overcome failure• Self determined goal setters
• Source: Pinchot 1986.
• Intrapreneuring. Harper & Row.
![Page 26: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/26.jpg)
26
Intrapreneurs need in addition
• Source: Pinchot 1986.
• Intrapreneuring. Harper & Row.
• An ability in a Multi-disciplinary role• To understand the environment• To encourage open discussion• Be able to create management options• To build a coalition of supporters.
![Page 27: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/27.jpg)
27
Corporate Entrepreneurs as ‘Change Masters’
• ‘Change Master’ A term used by Rosabeth Moss Kanter
• Three Stages of the journey: – Formulate and Sell,
– Power to advance,
– Maintain Momentum.
![Page 28: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/28.jpg)
28
Intrapreneurs as Change Masters
• A term used by Rosabeth Moss Kanter• Three Stages of the journey: Formulate and Sell,
Power to advance, maintain Momentum.• Skills: Personal and Interpersonal• Step outside of conventional thinking• Often ‘generalists’ with ‘kaleidoscopic thinking,
vision communicators, persistent individuals, coalition & team builders, willing to share credit
![Page 29: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/29.jpg)
29
Rosebeth Moss Kanter’s View
• Corporate entrepreneurs are people who envision something new and make it work. Being a corporate entrepreneur, what I call a ‘change master’ is much more challenging and fun than being a non-entrepreneur. It requires more of a person, but it gives back more self-satisfaction.– Rosabeth Moss Kanter (1988). Handbook for Creative and Innovative
Managers. McGraw Hill.
![Page 30: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/30.jpg)
30
Intrapreneurial Behaviour
• May be seen as good news– High achievement motivation– High task commitment
![Page 31: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/31.jpg)
31
Intrapreneurial Behaviour
• May be seen as mild irritants– High levels of informal networking– Informal recruitment (This could be a major
problem)
![Page 32: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/32.jpg)
32
Intrapreneurial Behaviour
• May be seen as serious problems– Independence– Non-acceptance of rules and boundaries– Non-compliance with planning and control
systems– Conflict with authority
![Page 33: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/33.jpg)
33
Developing Intrapreneurship
EncourageIndividualIntrapreneurs
Encourage GeneralEntrepreneurialCulture
EncourageEntrepreneurialEnterprise
FRAMEWORK CONDITIONS
![Page 34: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/34.jpg)
34
Barriers to an Intrapreneurial Culture
• Barriers Include:– Senior management feel alienated– hierarchical nature of the organisation– Corporate culture– Short term performance requirements– Planning procedures
• Source Gibb 1990
![Page 35: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/35.jpg)
35
Barriers to an Intrapreneurial Culture
• Barriers (continued) Include:
– Lack of ownership of the problem– Mobility of managers– lack of flexibility in the organisation– methods of compensation
• Source Gibb 1990
![Page 36: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/36.jpg)
36
An ‘Intrapreneurial’ culture needs:
• Sponsors• Continuous involvement• Autonomy of the intrepreneurial team• Ability to cross boundaries
• See Pinchot (1986)
![Page 37: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/37.jpg)
37
An ‘Intrapreneurial’ culture needs:
• (needs continued)
• A tolerance of risk and failures• Long term objectives• Making resources available• Introducing suitable compensation schemes.
• See Pinchot (1986)
![Page 38: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/38.jpg)
38
Drucker’s Entrepreneurial Practices
• Druker suggests some key management practices are vital in the development of ‘entrepreneurship’ in an existing business.– Management focuses on opportunity
– Generation and maintenance of entrepreneurial spirit
– Top-down and cross functional interaction• Source Drucker, P. Innovation & Entrepreneurship. Pan 1986
![Page 39: 1 ‘ Corporate Entrepreneurship’. 2 Corporate Entrepreneurship Introduction –(linking with other concepts of entrepreneurship) Venturing –(company activities)](https://reader036.fdocuments.us/reader036/viewer/2022081504/56649edc5503460f94bed40d/html5/thumbnails/39.jpg)
39
The final word …..
“Intrapreneurs cannot exist if their passionate commitment is ignored and their visions given to people who don’t understand them. Without intrapreneurs, innovation flounders
Source Pinchot (1986)