CORPORATE ENTREPRENEURSHIP

Entrepreneurial action within an established

organization.
Entrepreneurial Intentions Within
Existing Organizations

 Top management must create an environment that

encourages employees to think and act
entrepreneurially.

 Employees will realize that entrepreneurial action within

the firm is both personally desirable and feasible.
Managerial Versus Entrepreneurial
Decision Making
 Entrepreneurial management is distinct from traditional management in
terms of:
 Strategic orientation.
 Commitment to opportunity.
 Commitment of resources.
 Control of resources.
 Management structure.
 Reward philosophy.
 Growth orientation.
 Entrepreneurial culture.
Entrepreneurial Decision Making

 Strategic Orientation:
 Those factors that are inputs into the formulation of the firm’s strategy.
 Commitment of Resources:
 A focus on how to minimize the resources that would be required in the
pursuit of a particular opportunity.
 Management Structure:
 Few layers of bureaucracy between top management and the customer. It
also has multiple informal networks.
 Reward Philosophy:
 Compensates employees based on their contribution toward the discovery
/generation and exploitation of opportunity.
 Growth Orientation:
 A focus on rapid growth.
 Causes for Interest in Corporate Entrepreneurship
1. Increasing interest in “doing your own thing” and doing it on
one’s terms.

2. New search for meaning and impatience has caused more

discontent in structured organizations.

3. Organizations are encouraging corporate entrepreneurship i.e.

stimulating, and capitalizing on, employees who think that
something can be done differently and better.
 Corporate entrepreneurship is most strongly reflected in the following
activities:

For Explanation : Notes provided

LEADERSHIP CHATACTERISTICS OF A
CORPORATE ENTREPRENEUR
 Understand Environment:
Creativity and broad understanding of internal and external environment.
 Visionary and Flexible:
Dream great dreams and overcome obstacles.
 Create Management Options:
Open, encourage changes and creates something new in organizational
structure.
 Encourage the Team Work:
Utilizing multi-disciplined teams
 Builds a coalition of Supporters:
 Encourage team members, motivates them and make everyone a hero.
 Encourage Open Discussion:
 Allow frankness, open discussion, disagreement and criticism
 Persistent:
 He can deal with obstacles and frustration.
CHARACTERISTICS OF
ENTREPRENEURIAL ENVIRONMENT
➢ Organization operates at frontiers of technology i.e., most modern
technology. Research and development and new ideas are encouraged.
➢ Experimentation: Trials and errors are encouraged. This culture allows
mistakes and failures in developing new and innovative products.
➢ No Initial Opportunity Parameters: There are no barriers to new product
development and creation.
➢ Resources are available and accessible.
➢ Multi Disciplined Team Approach
➢ Establish a Long Run horizon
➢ Volunteer Program
➢ Appropriate Reward System
➢ Support of Top Management: Physically and providing resources.
Establishing Corporate
Entrepreneurship in the Organization
 Step one:
 Secure a commitment to corporate entrepreneurship in the
organization by top, upper, and middle management levels.

 Establish initial framework and embrace the concept.

 Identify, select, and train corporate entrepreneurs.

Establishing Corporate Entrepreneurship in
the Organization (cont.)

 Step two:
 Identify ideas and areas that top management is interested in
supporting.
 Identify amount of risk money available to develop the concept.
 Establish overall program expectations and target results of each
corporate venture.

 Step three:
 Use of technology to ensure organizational flexibility.
Establishing Corporate Entrepreneurship in
the Organization (cont.)

 Step four:
 Identify interested managers to train employees and share their
experiences.

 Step five:
 Develop ways for the organization to get closer to its customers.

 Step six:
 Learn to be more productive with fewer resources.
Establishing Corporate Entrepreneurship in
the Organization (cont.)

 Step seven:
 Establish a strong support structure for corporate entrepreneurship.

 Step eight:
 Tie rewards to the performance of the entrepreneurial unit.

 Finally:
 Implement an evaluation system that allows successful entrepreneurial
units to expand and unsuccessful ones to be eliminated.