Corporate Entrepreneurship: How?

Corporate Entrepreneurship

: How?

Content

What is Corporate Entrepreneurship

2 Types of CE: Focused and Organization Wide

Possible Transition?

What is Corporate Entrepreneurship?

The process by which individuals inside organizations pursue opportunities without regard to the resources they currently control

CE

Internal Corp.

Venturing

Strategic Renewal

Innovation

Expected Results• Improve competitive

positioning

• Transform companies, markets, and industries

• Improve organization’s growth and profitability

Organization Wide

Focused

How to develop Corporate Entrepreneurship?

• Mature organizations that do not take risks – “not upsetting the apple cart”

• Promote entrepreneurship by mandating it as a corporate objective

Focused Entrepreneurship – What is it?

Focused Entrepreneurship – How to Develop?

Company

InternalAppointments

ExternalEntrepreneurs

Strict compliance to financial

and classical management

controls

Difficult to change

chemistry and culture of organization

Managers =/=

entrepreneurs

Focused Entrepreneurship – Limitations

Results: Less than sustainable innovation and entrepreneurship

Org. Wide Entrepreneurship – What is it?

Opportunities are perceived and pursued by entrepreneurs

Money is not a motivator

Failure is considered normal

Risk-taking philosophy

Org. Wide Entrepreneurship – How to Develop?

RightEnvironment

• Right tone for innovation

• Select and rotate talented managers

• High level of Trust• Appreciate views

of individuals

• Multi stage resource allocation

• Draw the line between responsible and irresponsible

• Control the process

• Learn from past experiences

Discipline of parsimony

(kiam siap)

Risk containme

nt (Process)

Case Study: Wipro

Indian

Information Technology

(IT) Service

Consulting Services

Outsourcing services

Org. Wide Entrepreneurship – Case in Point

Azim Hasham Premji

Top 30 all time great entrepreneurs in the

world (Business week, July 2007)

Vegetable oil (1945-1970’s)

Azim Hasham Premji

Top 30 all time great entrepreneurs in the

world (Business week, July 2007)

(IT) services (late 70’s)

Vegetable oil (1945-1970’s)

Azim Hasham Premji

Top 30 all time great entrepreneurs in the

world (Business week, July 2007)

Lab on Hire (1991)

(IT) services (late 70’s)

Vegetable oil (1945-1970’s)

Azim Hasham Premji

Top 30 all time great entrepreneurs in the

world (Business week, July 2007)

Extended Offshore (main form of revenue)

Lab on Hire (1991)

(IT) services (late 70’s)

Vegetable oil (1945-1970’s)

Azim Hasham Premji

Top 30 all time great entrepreneurs in the

world (Business week, July 2007)

Quality Consulting Practice (2002)

Extended Offshore (main form of revenue)

Lab on Hire (1991)

(IT) services (late 70’s)

Vegetable oil (1945-1970’s)

Azim Hasham Premji

Top 30 all time great entrepreneurs in the

world (Business week, July 2007)

Great presentation bro.

High-five!

Org. Wide Entrepreneurship – Why the Success?

Right Environment

Discipline of parsimony

(kiam siap)

Risk containment

Structured Innovation Program

Free Space for Innovation Six Sigma

Same Same, but different?Ideas from HBR Article: Meeting the Challenge of Corporate Entrepreneurship

Similarities (Focused Entrepreneurship)

HBR• Diffused

Responsibilities Fizzled Out

• Centralization Isolates

CE – How?Limited success of “injecting” Entrepreneurship and Parallel Organizations

Insight: Established systems ensures success of existing businesses

but hinders building entrepreneurial culture

Similarities (Org. Wide Entrepreneurship)

HBRBalancing Strategy, Operations and Organization

CE – How?Right Environment, Operational discipline and Focus on Process

Insight: Enables companies to build, blend and maintain an entrepreneurial culture to be competitive and grow

Is it possible to shift from Focused Entrepreneurship and do well with Organization Wide Entrepreneurship?Ideas from HBR Article: Meeting the Challenge of Corporate Entrepreneurship

From “Focused” to “Org. Wide”

Entrepreneurship…The

Way

Pre 1999…

Previous “Focused Entrepreneurship” Culture and Systems

Unsuccessful Corporate

Venture Funds

Applied approach of

leading established

businesses to “new business opportunities”

Potential Businesses like “Life Sciences” cancelled

Post 1999…Emerging Business Opportunity (EBO)

Building the “Org. Wide Entrepreneurship” Culture and Systems

Operational

Experience with

Invention

Organization: Identity

with Integration

Experiment with Rigor and

Discipline

Strategy Dev: • Engagement with

market place through in market experiments.

• Reviews based on plan targets.

• EBO meetings with learning encouraged

Leadership: Leaders selected based on experience, skill and knack for entrepreneurship

Monitoring and Evaluation: Which can be integrated into existing business divisions?Scoring based on “clear strategy”, “executable model” and “winning in the marketplace”.

• 25 businesses launched in 5 years, 3 failed

• Revenue contributed $31 billion in 2002-2004

• Integrated successful businesses with corporate system

Results

• Incorporate entrepreneurship through leadership decisions

• Refrain from force-fitting entrepreneurship

• Dealing with the challenge of integration of new business with existing structures and systems

Lessons Learnt

Without the “change agent” leader, do you think that organization wide entrepreneurship can be sustained?

Is there a more influential driver to develop/hinder corporate entrepreneurship? (external)

“The process by which individuals inside organizations pursue opportunities without regard to the resources they currently control” Agree?

Questions for Discussion