How entrepreneurial thinking can accelerate growth in large corporations

1. How entrepreneurial
thinking
can accelerate
growth
in large corporations

2. 1. Growth Framework
2. Dynamic forces driving a company growth
3. Entrepreneurial strategy making
4. Final Lesson

4. Pros Cons
Business model advantages Business model challenges
Promote business development Business execution & renewal
Build credibility Human & other resources constraints
Human talent development Management challenges
Financial value creation and financing Funding challenges/dilution

5. Growth accelerators and inhibitors
1. Top management 9. Marketing/branding
2. Human resources/culture 10. Sales/distribution
3. Strategy 11. Partnership
4. Company financing 12. Capital markets
5. R&D / new product 13. Acquisitions/mergers
6. Product/after sales 14. Regulatory/government/taxation
7. Operations management 15. Economic/corporate environment
8. Customer/market opportunity 16. Legal/lawsuits

6. 2. Dynamic forces
driving a company
growth

7. Introduction
A company is an ecology in which strategic initiatives arise following
a certain pattern. Knowing how strategy originates and how strategy
making takes place is crucial for the company to control its destiny.
Strategy making depends on two variables: decision making power
concentration and simultaneity of strategic action.
Strategic initiatives within the company compete for limited
resources.
Every company has its own cultural and administrative mechanisms
to decide what initiatives are supported and how resources and
attention are assigned amongst them.

8. Robert Burgelman’s Rubber band Model
Basis of competitive
advantage In the industry
Competition at the company’s
position in the industry as a
result of external forces
(Porter + analysis)
Official Corporate
Strategy Internal selection
Strategic action
Beliefs on market domain and context What the company does The
the relative importance of the Reestablishes alignment consequential action in which
competencies to achieve a in both axis when it is altered the company engages. It links
competitive advantage. position and competencies
Values and principles of what
we will do and what will not
Distinctive competencies
Skills, assets and routines to
meet the basis if competitive
advantage in the industry

9. Misalignment 1
Basis of competitive
advantage In the industry
What it takes to win
Official Corporate
Strategy
What we say
Internal selection
context
Culture
Strategic action
What the company does
Distinctive competencies
What we’ve got

10. Misalignment 2
Basis of competitive
advantage In the industry
What it takes to win
Official Corporate Internal selection Strategic action
Strategy context
What we say What the company does
Culture
Distinctive competencies
What we’ve got

11. Strategic Dissonance
Revenue Growth
Dissonance
Time

12. Sources of Strategic Dissonance
Dissonance is Strategic if:
- There is a divergence between Basis of Competitive Advantage
and Distinctive Competence.
- There is a divergence between Official Corporate Strategy and
Strategic Action.
Initially the signals are usually weak so our job as leaders
is to discern signals from noise

13. 3. Entrepreneurial
strategy
making

14. Strategy Processes Induced Autonomous
Emerging
External
Environment
Autonomous Strategic
strategic action. Context
O cial
Known
Corporate
environment
Strategy
Induced Structural
Strategic Action Context

15. Definitions
Known environment: This is where the induced strategic process takes place. Threats and opportunities arise
form here, forcing the company to adjust the induced strategy process.
Emerging external environments: Unfamiliar, unknown environments where the autonomous strategy process
takes place. Many of them do not survive but others may grow and complement or even substitute the
familiar environment.
Official Corporate Strategy: Beliefs on what the company does well, in what markets it can succeed, what are
its values and what goals it aims to achieve.
Induced Strategic Action: Initiatives on the part of operational and middle level managers that fit the concept
of the official corporate strategy. Is oriented toward gaining and maintaining leadership in the company’s core
businesses.
Autonomus strategic action: Strategic initiatives outside the scope of the official corporate strategy. They
differ from the induced ones in the technology they use, the value proposition or the target clients. They rely
on new competencies or in a new combination of the existing ones. They lead to new businesses that are
different from the core business, complementing or even substituting it.
Structural Context: Administrative and cultural mechanisms to keep coherence between the official corporate
strategy and the induced strategic action. The larger the company the more complex they are. Transforms
“concept” into “action.
Strategic Context: Administrative and cultural mechanisms to evaluate and choose strategic initiatives
outside the structural context. Transforms “action” into “context”.. It allows to assess the adaptive potential
of the autonomous strategic action to the official corporate strategy (which will change upon this incorporation).

16. Conclusion
The autonomous strategy process begins with strategic initiatives that
often emerge fortuitously and unexpectedly. Initially there is no clarity
about their strategic importance and how they may relate to the induced
strategy process. Solving this indetermination is the most important
challenge for company evolution. Hence why the design of the strategic
context is crucial.

17. 4. Final
Lesson

18. Two systems one company
Internal
selection
context
Strategic Structural
Context Context
.

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