Intrapreneurship

Just what is intrapreneurship, you may be asking? The term looks very similar to entrepreneurship, you're thinking. Well, it is. Only intrapreneurship is applied to an already well-established organization.

The Web site, Investopedia, defines the term as, “Acting like an entrepreneur within a larger organization…[intrapreneurs are] usually highly self-motivated, proactive and action-oriented people who are comfortable with taking the initiative, even within the boundaries of an organization, in pursuit of an innovative product or service” (n.d.). Investopedia goes on to note:

The major difference between entrepreneurs and intrapreneurs is that the fruits of success default to the organization rather than to the intrapreneur. On the other hand, the intrapreneur also has the comfort of knowing that failure will not have a personal cost - as it would for an entrepreneur - since the organization would absorb losses arising from failure (Investopedia, n.d.).

Shabana (2010), in an academic piece, goes into further detail on what intrapreneurship is, noting that those who practice the art, “…can help established companies implement innovative policies and procedures or introduce innovative products or services. Intrapreneurs, however, must have a fair amount of latitude within a company in order to effect any significant changes” (p. 32). The author continues, “Workers who earn the title ‘intrapreneur’ usually go well beyond their narrow job descriptions, providing valuable help in innovating some aspect of their companies” (Shabana, 2010, p. 32).

There are essentially two basic types of intrapreneurial organizations: the incremental innovator, and the radical one. Incremental innovators tend to take smaller, more gradual and cautious steps toward achieving innovation, while radical innovators approach innovation in a far riskier, bolder way.

But intrapreneurship does not only apply to commercially-viable end products or services, or to technology. Equally important is improving an overall business model. As Davila, Epstein, & Shelton (2006) points out, “Typically, when people think about innovation, they think of technological innovation. However, business model innovation is just as important and just as powerful in driving business success and revolutionizing industries” (p.14). The authors go on to note that, “Business models describe how the company creates, sells, and delivers value to customers, and it includes in the description the supply chain, targeted customer segments, and the customers’ perception of the delivered value” (Davila, Epstein, & Shelton, 2006, p. 14).

In any case, though, whether an organization is deemed to be an incremental or radical innovator, or whether it has greatly enhanced a product/service offering or a business model/process, Eesley & Longenecker (2006) calls intrapreneurship, “… a key component to organizational success, especially in organizations that operate in rapidly changing industries” (p. 19).

How does your organization promote and foster a culture of intrapreneurship? What processes and systems are in place to achieve this? Share your thoughts and insights in the Comments section.

Reference

Davila, T., Epstein, M. J., & Shelton, R. (2006). Making innovation work: How to manage it, measure it, and profit from it. Upper Saddle River, NJ: Wharton School Publishing.

Eesley, D. T., & Longenecker, C. O. (2006). Gateways to Intrapreneurship. Industrial Management, 48(1), 18-23.

Intrapreneurship. (n.d.). In Investopedia. Retrieved May 23, 2013, from http://www.investopedia.com/terms/i/intrapreneurship.asp

Shabana, A. (2010). Focusing on Intrapreneurship: An Employee-Centered Approach. Advances In Management, 3(12), 32-37.