‘Intrapreneurship’ is a word that has been getting a lot of attention from senior executives lately. But what exactly does intrapreneurship mean? And how can your company capitalise from developing intrapreneurs?
Intrapreneurship in a simpler term refers to any entrepreneurial activity that takes place within an organisation. Such activities may include developing new methods and processes to improve efficiency or addressing new opportunities outside normal business activities. In this regard, intrapreneurship also refers to a change in mindset to think like an entrepreneur. An intrapreneur recognises new opportunities, is driven by customers, makes the most of resources and moves quickly within the organisational framework.
A new and innovative business model for innovation: The way by which SMEs and large enterprises discover and implement innovation in their organisation is ever changing. Thanks to internal incubators, venture teams and accelerator panels, corporate organisations are also bringing the start-up and entrepreneurship mentality to their culture. This concept of intrapreneurship is rapidly embraced by small and large companies alike.
The role of leadership and culture in innovation: A company may have started with the mindset of an entrepreneur and a business model that was agile and innovative. However, as a company grows, it begins focusing on cost-cutting and process optimisation. While this certainly helps profits, it instils a culture of risk avoidance and operational excellence within the organisational culture.
If innovation is a corporate objective, then the company culture must be able to account for the uncertainty and risk that comes with it. This proves to be a major challenge for most organisations – changing the culture to accept innovation. While many experts recommend changing the culture to focus on innovation, little is known about the methods through which this can be done.
Today, innovation is the corporate strategy for over two thirds of CEOs worldwide. Moreover, most organisations claim that they support innovation and entrepreneurial behaviour. However, this is not the case in real terms.
An organisation leader’s role is critical when it comes to building an environment where innovation can thrive. While most leaders innovate at an organisational/macro level, innovation at the personal/micro level is often overlooked. Leaders must learn to acknowledge innovation at personal levels to inspire open thinking and creative ideas. Also, leaders must learn to accept the uncertainties, risks and failure that may come with innovating. Only then can innovation truly be a part of the corporate culture.
As a leader, you must learn to influence innovation both on the macro and micro levels strategically. Through interpersonal effectiveness, you can introduce a culture of open and innovative thinking in your organisation. To do this, you’ll need to get rid of judgements and assumptions, increase your dialogue with employees and focus on developing intrapreneurship.
“That’s great, but does my organisation really need a shift in organisational culture and embrace intrapreneurship? My company has been doing fairly well with an X% growth year on year.”
I understand your concern about bringing about a change in culture. However, nothing lasts forever, all products and services have a burn rate. You must accept this and future-proof your business. Here are five important reasons why your culture must consider developing intrapreneurship:
Growth: As a CEO, you’ve allocated 12-16% of profit to innovation and development, you know that you need to invest this money – just not sure on how or where to invest.
Developing intrapreneurs within your company can answer these questions. An intrapreneur thinks from an entrepreneurial mindset that is always focused on what’s needed to grow. It is a transformational framework which takes a system’s view of growth. Intrapreneurship can help your organisation realise new opportunities for growth.
Leadership: Like I mentioned, leadership is closely tied to the success of innovation. Unfortunately, too many CEOs just don’t feel like they have the organisational capability to achieve sustained innovation. The capabilities that take a CEO to the top are not the same skills that are required when looking for new growth.
Developing intrapreneurship can help leaders to think as well as act differently. When leaders think from an intrapreneurial mindset, they acquire new competencies, aspirations and motivations. This differentiation enables them to lead new initiatives for growth and innovation.
Culture Change: Arguably, change is the most underdeveloped and least understood of all management disciplines. But, change is also one of the most important. Many studies indicate that organisations suffer from a 60%-70% failure rate with change initiatives. This is because most cultures are focused on aversion to risk and resistance to change. However, this severely impedes the ability of an organisation to grow.
An intrapreneur is the driving factor of change. Not only do intrapreneurs prioritise change, but they embrace change themselves. By modelling change, an intrapreneur drives change and enables an organisation to manage change effectively.
Innovation: If your company is focused on aggressive growth at the top line, it must embrace innovation. However, undergoing a couple of innovation initiatives does not sustain or support innovation at all. For innovation to be successful, companies need to innovate all the time as innovation failure rates range between 50%-90%.
Also, innovation by itself does not help an organisation grow. Innovation must be accompanied by the right environment, right people and right processes. This can only be achieved by developing intrapreneurs. Only when intrapreneurship and innovation are tied together and are both successful can an organisation sustain long-term innovation.
Engagement: Lack of engagement within a company leads to lost productivity, which in turn leads to slow or even no growth. However, embracing the intrapreneur mindset provides an engaging platform to employees. Intrapreneurs are always highly focused on work, and their determination and passion inspire other employees. This allows them to take up meaningful and challenging work and as they grow, so does the organisation.
Developing intrapreneurs can help your employees grow which still keeping them engaged and productive. While some organisations view this as a critical imperative, others view it as a survival strategy. Most companies to have embraced the intrapreneur mindset have been more productive, enjoyed better returns and have better levels of employee engagement.
So, don’t you think its high time you take a closer look at developing intrapreneurship within your organisation?
Conclusion: While innovation is part of every company’s growth strategy, corporate culture often proves to be a barrier to it. Organisational culture should change to embrace innovation initiatives to grow. The best way to do this is by developing an intrapreneurial mindset within the company.
An entrepreneur will be an entrepreneur, companies need to retain their employees, one of the best ways to both attract and keep your most entrepreneurial leaders is through Intrapreneurship.
Leadership is another crucial aspect that impacts innovation. Senior executives should have the skills and capabilities to make informed decisions on innovation at both macro and micro levels. If your company does not have the leadership to support innovation, you will soon experience slower growth or worse a rapid downturn.
Beyond leadership, consistent communication with employees, compensating them, training and inspiring them can all help build the platform that drives a shift in corporate culture. Intrapreneurship development can help your company achieve sustained innovation over the years.
About the writer.
A founder of multiple startups Hader Ali is an innovation & business consultant.
Hader Ali Consultancy works with startups, SMEs, and large organisations. Specialising in business strategy, product/service development, sales & marketing.
To future-proof your business. Hader Ali Consultancy will work with your company to create an innovation portfolio by providing a framework for structured innovation. All while creating an ecosystem of ideas and a culture of innovation.