This is the first part of a series of articles in which you will get an overview of the meaning of intrapreneurship. You will learn what intrapreneurship exactly means, how it works and what it takes to successfully implement it in your company.
Companies are increasingly operating in a highly competitive environment. Constant new trends such as digital transformation, artificial intelligence, Industry 4.0 and many others provide a permanent pressure for innovation and growth.
In the process, companies are now also under attack from startups, which are often more agile and customer-focused due to their specialization and corporate culture, thus posing a further threat.
Nevertheless, some companies are hardly facing this change, as business is probably still going well at the moment. However, the Corona crisis has shown how quickly this can change: Within just a few weeks, entire business models came to an almost complete standstill or had to continue operating under completely new conditions (e.g., from a home office).
Another trend to which companies must respond is the desire of employees for a working environment that is more free of hierarchy, more transparent and also a bit more democratic. Meaningful work, responsibility, decision-making authority, building something new – these points are at the top of the list in many employee surveys today. Employers who fail to score here will have difficulty winning the war for talent in the future.
How can these different challenges be met while ensuring the future viability of the company?
THE MAGIC WORD IS “INTRAPRENEURSHIP”
“Intrapreneurship” is a simple but effective approach to accelerating innovation and simultaneously promoting and developing employees and their entrepreneurial skills.
The term “intrapreneurship” is little known in the German-speaking world. More often, people speak of “entrepreneurship in the company”, meaning that employees should think and act more entrepreneurially. This is often talked about at events and appeals are made to employees to get involved in an entrepreneurial way.
However, there is often a lack of further explanation as to what exactly is meant by this, how employees should behave, or what concrete measures are provided by the company to support such action.
The word “intrapreneurship” is a combination of the English terms “entrepreneurship” and “intracorporate”.
Entrepreneurship” is generally understood to mean everything that has to do with entrepreneurship. In this context, the “entrepreneur” is the classic entrepreneur who, by founding a company, has decided to implement an idea on his or her own responsibility. In doing so, he bears the risk of failure and must also take care of financing, among other things.
“Intracorporate” means all activities that are organized and carried out within a company. There is a hierarchical corporate organization that ensures that all corporate processes interact harmoniously with each other.
“Intrapreneurship” means that employees can act as employees in a company as if they were entrepreneurs themselves. They work independently, creatively and team-oriented, are well networked and their actions are aimed at achieving sustainable corporate success through the development of new products, processes, services, etc.
“Intrapreneurs” thus represent an important key to the future-oriented further development of innovations and ultimately also to the success of the company in which they are employed.
An often-cited example of “intrapreneurship” is Tony Fadell, who failed with his own company, i.e., as an “entrepreneur,” but then succeeded with his idea as an employee at Apple: He invented the iPod and created the foundations for the iTunes streaming service; in doing so, he caused a “disruption” (upheaval) in the music industry.
Question for you: How important are innovative ideas from employees in your company and how are they promoted and developed?
EVOLUTIONARY AND REVOLUTIONARY INNOVATION
Companies have long had evolutionary innovation programs aimed at improving products, optimizing work processes or increasing safety in the workplace. These are known as company suggestion schemes. Cash or non-cash rewards are offered for suggestions that are implemented. The aim of these and other programs, such as the continuous improvement process, is to increase the quality of the products introduced, to streamline existing processes and/or to make them more cost-effective. Such innovations are close to existing products, services and processes, and thus to everything the company already does. If, for example, a spirits producer starts to produce disinfectants during the Corona crisis, this would be an innovation that is close to the existing product.
Revolutionary innovations are not about innovations that improve the next step or process extension on the existing, but about completely new business models that are developed in addition to the existing business areas. This is about radical new product innovations (e.g. a car manufacturer decides to produce breathing apparatus during the Corona crisis) or disruptive business models which are developed to enable new growth.
Evolutionary and revolutionary innovations are important for a company. Basically, both types ensure that growth occurs, costs are saved and profits are increased.
However, in order to be able to tap new sources of growth through innovations, especially in the age of digitization, evolutionary innovations are no longer sufficient in many cases because the classic way of identifying customer problems and establishing solutions takes too long and can also be very costly or risky.
Even concepts of time can differ here between classic companies and startups: In a corporation, “fast” often means a period of six weeks; in a startup, it means tomorrow.
Question for you: Who can employees in your company turn to when they have an innovative, evolutionary or revolutionary idea?
To read more:
Part 1: Intrapreneurship – How innovation succeeds from within your own company.
Part 2: How intrapreneurs think and work
Part 3: Success factors for successful intrapreneurship in your company