What is intrapreneurship? Why is it important? Does Australia have intrapreneurs? These were many of the questions that were presented at the recent Griffith Alumni professional development webinar – Harnessing the power of Entrepreneurship and Intrapreneurship – delivered by Associate Professor Naomi Birdthistle from the Department of Business Strategy and Innovation. In addressing these questions, Naomi introduced to the participants the fact that intrapreneurship is not a relatively new concept but was first coined in the 1960’s by Gifford Pinchot III, who defined intrapreneurs as dreamers who do. More specifically intrapreneurship is a term that reflects the formal or informal activities aimed at creating new businesses in established companies through product/process innovations and market developments.
So basically, intrapreneurship is where employees think like entrepreneurs but work in an already established organisation rather than their own business. An established organisation that ‘acts’ intrapreneurially gives their employees freedom and financial support to create new products, services and systems and who do not have to follow the company usual routines or protocols. One of the leading examples of intrapreneurship is the 3M organisation. The idea for the Post-it note was conceived in 1974 by Arthur Fry as a way of holding bookmarks in his hymnal while singing in the church choir. He was aware of an adhesive accidentally developed in 1968 by fellow 3M employee Spencer Silver. No application for the lightly sticky stuff was apparent until Fry’s idea.
Steve Jobs described the Macintosh team of the 70s and 80s as:
“intrapreneurs – a group of people going, in essence, back to the garage, but in a large company.”
Intrapreneurship is a behavior sought out by many employers and start-up businesses. It is a mindset and series of behaviors that can be learnt which leads to the creation of a self-motivated, proactive, and action-oriented employee who take the initiative to pursue and deliver an innovative product or service. Intrapreneurship is a win-win situation for both the business and the employee. It allows companies to be disruptive and develop new ways of doing business or new products or processes within the structure of the organization. Intrapreneurship is a way to innovate like a start-up, while being as organized as a corporate and it puts employees and their creativity in the centre and transcends hierarchical organisations, being a bottom-up approach. Intrapreneurs demonstrate their entrepreneurial orientation by the way they think and act. They have an entrepreneurial mind-set: they think differently, make decisions differently and act differently when compared to more traditional employees. These attributes enable them to be effective in driving innovation and change from inside an established organisation. They are creating new paths, new ways of operating that are often foreign to many of their colleagues.
How does Australia fare in terms of intrapreneurship? Quite well actually. According to the Global Entrepreneurship Monitor report for Australia (2017/2018) Australia ranked #7 amongst 24 developed economies for Entrepreneurial Employee Activity in established firms, which equates to about 1.2 million Australians. Thus, an estimated 7.8 per cent of the adult population in Australia is engaged in developing or launching new products, a new business unit or subsidiary for their employer.
One of the cardinal sins that many businesses commit – whether implicitly or accidentally – is to stifle the creativity of employees who are bright and ambitious. Often, inward-looking management and the bureaucratic processes can leave these talented charges with little opportunity to flourish. But this can be changed. It starts at the top with leadership and an innovation culture willing to commit system-wide resources. It must have a governance process that can deliver on a clearly articulated mandate. An inclusive organisational structure incorporating processes, tools, metrics and rewards must be present.
Companies need skills and talent that are differentiated from traditional R&D or new product development roles. Google has an intrapreneurial culture within its organisation. It gives employees 20 per cent of their time for personal projects. This is how Gmail emerged.
A common misconception is that corporate intrapreneurs are cash-flush and resource-rich. Many intrapreneurs are developing projects on top of their day jobs or have limited access to finance for experimentation. To unlock the resources of the organisation (and beyond) will require getting creative and honing skills for execution. Moreover, this is not a bad thing. The old saying “scarcity is the mother of invention,” rings true today for the social intrapreneur as much as it did for our pre-historic ancestors.
Today, the ability to create something from nothing is part of the ‘do-it-yourselfers’ and lean startup enthusiasts. It is about accelerated learning and failing fast and failing cheaply.