Chapter 20 Corporate Entrepreneurship

Learning Outcomes On completion of this chapter you will be able to: Define the term Corporate Entrepreneurship Discuss the different forms of Corporate Entrepreneurships Discuss the corporate entrepreneurial life cycle Understand the concept entrepreneurial intensity Understand the role of a Corporate Entrepreneurship Culture Explain the individual characteristic of the Corporate Entrepreneur Explain the constraints placed on Corporate Entrepreneurship Explain how Corporate Entrepreneurship can be promoted in a company Know how to measure a firm’s Corporate Entrepreneurship Intensity

Corporate Entrepreneurship Corporate Entrepreneurship is a term that is used to describe entrepreneurial activity within an existing business.

Manager versus Corporate Entrepreneur ManagerCorporate Entrepreneur Vision Calculated Risks Organising Planning Coordination Control Strong sense to report Apply managerial principles Strong sense of accountability

Forms of Corporate Entrepreneurship Internal Venturing – New business in existing firm New Venturing – New business added on existing business Strategic Venturing – redefine firm relationship with internal and external environment

Corporate entrepreneurial cycle The different stages a company goes through from being very creative to becoming very formal.

Corporate Entrepreneurial Intensity (CEI) The degree and frequency of entrepreneurial activity in an existing business. A company’s CEI will vary according to : Internal (type of management structure in place; decision making routes, policies, rules and regulations in place); and External factors (competition, government legislation, customer base) that they need to deal with.

Corporate Entrepreneurship Culture Basic beliefs and assumptions about what the company is

Elements required to create an entrepreneurial culture Pay attention to the basics (for example regular feedback, recognition) Doing the right things (provide promised resources) Know what is going on in your company Encourage commitment and take responsibility Create value through innovation and change Empower staff (teaching, training and learning) Forgive failures and provide freedom to employees to grow Place a sense of urgency on all matters and guide employees to focus on the future

Individual characteristics of the corporate entrepreneur Middleclass person Highly educated Some technical background Requires freedom Access to company resources Self-motivated Wants corporate recognition and rewards

Constraints on corporate entrepreneur Strategic Direction Systems Structures Policies and Procedures.

Ways to promote corporate entrepreneurship Allow employees to experiment with low risk opportunities. Listen to new employees and young people. Provide recognition Budged for new innovative ideas

Measuring Instruments Corporate Entrepreneurial Intensity Corporate Culture

Glossary Entrepreneurial Culture Corporate entrepreneurship Corporate entrepreneurial life cycle Corporate culture Corporate strategy Corporate Venturing Entrepreneurial Intensity External corporate venturing Internal corporate venturing ‘Intrapreneurship’ ‘Intrapreneurial’ Characteristics Policies and Procedures Strategic Entrepreneurship Structures Systems