1. ‘Corporate
Entrepreneurship’
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2. INTRODUCTION
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3. Business Life Cycle and Entrepreneurship
New Entrepreneurial
stage needed ?
Sales
Entrepreneurial Consolidation Maturity
Approach ?
Entrepreneurial ? Growth
Survival
Inception
Time
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4. 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.)
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5. 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
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6. Innovation
Creativity and Innovation are NOT synonymous.
Innovation = Creativity + Invention + Exploitation
Source: Rosenfeld and Serco. 1990
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7. 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.
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8. 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
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9. Dimensions
 Birkinshaw (2003) identifies four common
themes in corporate entrepreneurship.
 Corporate Venturing
 Intrapreneuring
 Bringing the Market Inside
 Entrepreneurial Transformation
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10. Hierarchy of terminology in Corporate
Entrepreneurship
Entrepreneurship
Independent Corporate
Entrepreneurship Entrepreneurship
After: Sharma and Chrisman (1999)
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11. Hierarchy of terminology in Corporate
Entrepreneurship
Entrepreneurship
Independent Corporate
Entrepreneurship Entrepreneurship
Corp. Venturing Innovation Strategic
Renewal
Int.. Corp. Venturing Ext.. Corp. Venturing
After: Sharma and Chrisman (1999)
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12. Why venture?
 Growth
 Improved financial returns (e.g. ROI)
 Image (Corporate renewal)
 Technology pressure
 Diversification
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13. 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
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14. Policy Ideas - Venturing
Joint External
Venture Environment
Ext. Co.
Merger
Int. Suppliers
venture
Encourage Contractors
Entrepreneurship
Buy stake
Customers
Spin out
Acquisition Take
stake
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15. Intrapreneurs
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16. 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
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17. 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.
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18. Intrapreneur
 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).
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19. Intrapreneurs
May have these
characteristics in common
with independent
entrepreneurs
Ability to work amidst confusion
Ability to anticipate change
Ability to make intuitive leaps
High energy levels
Creativity in problem solving
Action orientation
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20. ….. But want ...
BUT may differ ….
Want less restrictive but supportive environment
Want recognition
Want their ideas to be a vehicle for advancement
Want the security (pay cheque, pension etc)
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21. Intrapreneurs and entrepreneurs share: .
 Entrepreneurial
characteristics
 Vision & Flexibility
 Action Orientated
 Dedicated
 Persistent / overcome failure
 Self determined goal setters
 Source: Pinchot 1986.
 Intrapreneuring. Harper & Row. 21

22. Intrapreneurs need in addition
 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.
 Source: Pinchot 1986.
 Intrapreneuring. Harper &
Row.
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23. 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.
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24. 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
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25. 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.
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26. Intrapreneurial Behaviour
 May be seen as good news
 High achievement motivation
 High task commitment
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27. Intrapreneurial Behaviour
 May be seen as mild irritants
 High levels of informal networking
 Informal recruitment (This could be a major
problem)
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28. 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
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29. Developing Intrapreneurship
FRAMEWORK CONDITIONS
Encourage
Individual
Intrapreneurs
Encourage
Entrepreneurial
Enterprise Encourage General
Entrepreneurial
Culture
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30. 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
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31. 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
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32. An ‘Intrapreneurial’ culture needs:
 Sponsors
 Continuous involvement
 Autonomy of the intrepreneurial team
 Ability to cross boundaries
 See Pinchot (1986)
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33. 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)
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34. 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
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35. 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)
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