The Point: Today, there is a need for organizations to embrace innovation to remain competitive. While some opt for acquisitions to infuse creativity, integrating startup cultures often proves challenging. Instead, a more sustainable path to innovation lies within fostering intrapreneurship – the entrepreneurial spirit within an existing organization. Intrapreneurship not only benefits the organization itself but also empowers its workforce. In this article, we explore the concept of intrapreneurship, its advantages for organizations and employees, the importance of incentivizing innovation, and how to create a culture that nurtures intrapreneurial endeavors…Enjoy!
Key Takeaways from ‘From Employee to Intrapreneur’
Intrapreneurship: The Key to Innovation
Intrapreneurship is the practice of fostering an entrepreneurial mindset and culture within an established organization. It empowers employees to take on innovative roles, drive change, and explore new opportunities while benefiting from the support and resources of the organization.
Advantages for Organizations
1. Stimulating Innovation Within
Intrapreneurship infuses an organization with fresh ideas, stimulating a culture of constant innovation. This not only keeps the company dynamic but also attracts creative talent and establishes it as a sought-after workplace.
2. Embracing Change for Survival
In the face of evolving markets and technological advancements, organizations that resist change risk obsolescence. Intrapreneurship facilitates a proactive approach to adaptation, ensuring a company’s long-term survival in a competitive landscape.
Advantages for Workers
1. The Safety Net of Intrapreneurship
Unlike traditional entrepreneurs who face financial risks, intrapreneurs operate with a safety net provided by the organization. Failure becomes a valuable learning experience, preparing them for future entrepreneurial ventures.
2. A Path to Entrepreneurship
Successful intrapreneurs can leverage their innovative skills gained within the organization to eventually become entrepreneurs, either independently or by leading new ventures within the company.
The Innovators’ 80/20 Rule
Approximately 20% of employees in a typical organization generate 80% of innovations. This select group stands out due to their curiosity, passion for improvement, and resilience in the face of failure. They view setbacks as stepping stones toward success, understanding that innovation rarely happens flawlessly from the outset.
Incentivizing Innovation: The Two “R’s”
The pursuit of innovation requires proper incentives. Organizations serious about fostering innovation should ask whether they adequately reward and recognize it.
1. Recognize Innovation
Leadership must actively acknowledge and appreciate innovative efforts within the organization. This recognition not only motivates the innovators but also sets an example for others to follow.
2. Reward Innovation
In addition to recognition, there should be tangible rewards for innovation. This can come in various forms, such as bonuses, promotions, or even dedicated innovation time. Rewarding innovation ensures that creative ideas are not only acknowledged but also encouraged.
For organizations, intrapreneurship stimulates innovation, attracts creative talent, and ensures adaptability in the face of evolving markets. It is the antidote to “organizational Darwinism” – the idea that companies must evolve to survive. For employees, intrapreneurship provides a safety net, allowing them to experiment without the financial risks faced by traditional entrepreneurs. It also serves as a launchpad for future entrepreneurial endeavors. However, creating a culture of intrapreneurship requires proactive recognition and rewarding of innovation within the organization. By doing so, organizations can foster a culture of innovation that benefits everyone involved.
Sam Palazzolo, Managing Director @ Tip of the Spear Ventures
- Harvard Business Review: “The Myth of the Intrapreneur” – https://hbr.org/2018/06/the-myth-of-the-intrapreneur
- MIT Sloan Management Review. “Fostering a Culture of Innovation.” 2018
- Aleksandra J. Kacperczyk. “Opportunity Structures in Established Firms: Entrepreneurship versus Intrapreneurship in Mutual Funds.” 2012