You've heard of entrepreneurs. Now make way for the next generation.
Everyone knows what characterises an entrepreneur: a maverick, energetic, risk-taking visionary who likes to go it alone. Nurturing those individuals within a company – giving them the space to be creative and experimental – is harder to achieve.
But developing an environment for these “intrapreneurs” is a valuable if not essential requirement, recognised by more and more companies. Google, Facebook and 3M are well known for encouraging entrepreneurial behaviour and Richard Branson credits Virgin’s success with being able to attract these business super heroes to the company’s ranks.
“Virgin could never have grown into the more than 200 companies it is now,” he told Entrepreneur
magazine, “were it not for a steady stream of intrapreneurs who looked for and developed opportunities, often leading efforts that went against the grain.”
Related: So many good ideas seem obvious once somebody does it
What differentiates intrapreneurs from entrepreneurs is the Zeitgeist around a team rather than an individual says Justin Greig, Advisory Partner responsible for innovation at accounting firm Ernst & Young (EY).
“At EY, we have a leadership team committed to continual sponsoring of ideas, engaging in open dialogue with teams either face-to-face or using online tools such as Yammer [an enterprise social network that allows collaboration across departments and regions] or idea-sharing platforms such as Idea Jamming.”
“The intrapreneurial phenomenon is definitely on the rise,” says Andrew Green at Cisco, a company specialising in network equipment.
“With the proliferation of new technology and associated devices now moving from the consumer environment into the business world… we are seeing a new generation entering the workforce [with] the intrapreneurial spirit and desire to change the way we work.”
Outside of the technology and communications sectors, it’s fair to say the pace of change is slower and it’s more than likely that potential intrapreneurs are going unrecognised.
"The intrapreneurial phenomenon is on the rise." – Andrew Green, Cisco
Bridget Gray, Director and Head of Digital Practice at recruitment consultancy Harvey Nash, says great talent can be found “just by looking around and opening your eyes”. Gray adds that businesses need to project a clear message that ideas and creativity are important to them and institute regular meetings where people can be open and feel secure.
“Then you’re more likely to have people put their hand up and say: ‘I want to be part of that journey.’”
How a company embarks on the journey is crucial. Rewarding risk, providing funding and granting independence are the building blocks for creating an intrapreneurial environment, writes Andreas von der Heydt, Country Manager Amazon BuyVIP and LinkedIn Influencer.
Greig agrees but argues it’s not the whole picture. “It may seem counter-cultural but in my experience you need top-down leadership. If you don’t have a respected cohort in the business giving oxygen and emotional capital then ideas wither on the vine.”
Fostering a start-up mentality is what they have tried to do at digital media company Mi9, says Richard McLaren, Managing Director of Data and Services.
“We have a long way to go, but by empowering our people to run projects like they are their own business – by setting success measures and expectations but not dictating “how” something needs to be delivered, we’re breeding a generation of employees who feel a sense of responsibility and are constantly innovating.”
In around 60 per cent of cases, estimates Greig, it is management that stands in the way of innovation.
“Good ideas are easy. It’s surprising how eager staff are to contribute given a safe environment in which to prosper. What is harder to align are the layers of management, following through, testing ideas and taking them to market.”
For an intrapreneurial environment to be sustainable, it has to be consistent with a company’s overall culture, adds Greig.
“There needs to be a fairly mature dialogue in the business about how much disruption the company wants. If you’re contemplating a fair amount, you need to screen it quite some distance from the company. Don’t put it in the mainstream business.” Gray agrees that it’s about creating space for innovation without impacting on day-to-day business.
Organisations with rigid hierarchies are going to find letting intrapreneurs loose in their business more challenging, says Gray but adds, “there’s almost an expectation now among top talent that companies will offer this freedom. There has to be that spontaneity in business but well thought out so that it doesn’t affect productivity.”
Putting money where mouths are, companies should have a funding mechanism that is easy to activate, advises Greig.
“If you throw a lot of forms and bureaucracy in the way, then it becomes difficult. It’s important for companies to figure out how they are going to allocate funding initially and how that should change later in the process when the stakes are higher.”
Innovation funding at EY is allocated through a “Dragon’s Den” process that feeds resources to employees with good ideas and encourages them to come up with propositions in two to eight weeks. If they’re viable, a partner or partners are attached to help see the project through to prototype and eventually to the market.
“Not every idea will bear fruit and a company doesn’t want to encourage a culture of failure but instead learn from it quickly and adapt,” says Greig.
The accountant intrapreneur
Gifford Pinchot is the author of Intrapreneuring: Why you don’t have to leave the Corporation to become an Entrepreneur. On his website he comments how in his coaching of intrapreneurs, he’s found having the support of accountants and finance people who understand intrapreneuring is essential.
“If your future employer wants innovation, then having accountants who understand and value intrapreneuring will be necessary. Enterprises of all sizes need accountants who can figure out how to account for new business models and new kinds of contractual relationships,” he says.
As routine accountancy work moves to lower-cost nations, Pinchot believes the work done in wealthy countries will increasingly be about innovation and major change issues like sustainability.
“Even if they are not driving innovation themselves, accountants will increasingly find themselves supporting innovation, which will require them to be flexible and innovative themselves.”
4 ways to encourage innovation
By Aeve Baldwin
When you hear the word “innovation” do you think about Silicon Valley start-ups or shiny new tech products coming from companies with big R&D budgets? Even small businesses, from coffee carts to bricks and mortar shops can come up with big ideas. The key is having an environment that fosters innovation – and then putting those ideas into practice.
One way to foster innovation, according to Business Tasmania
, is to broadcast the need for change within your business, involve employees in the process and then monitor the effects of the change. Make sure that what your company means by innovation is clearly outlined and employees are included in the process – without an invitation to the innovation party, employees can feel reluctant to raise new ideas and take ownership of them. Once you’ve invited that change, support it.
Many companies are beginning to come around to the idea that failure is a part of success. Venture capitalists who tolerate failure, for example, tend to foster innovation according to MIT Sloan Management Review
. Harvard Business Review suggests that companies wanting to be failure-tolerant should build exit strategies
into projects to ensure that “doomed efforts don’t drag on indefinitely”.
Reward doesn’t have to be monetary, nor does it have to be big, but nothing sends a clearer message to employees that new ideas are welcome than a dangling carrot.
Make innovation part of the company culture
Hold “innovation” meetings, create an environment where ideas are shared and make sure that ideas are acted upon and recognised – nothing kills initiative faster than failure to see anything come from it or lack of credit for ideas submitted.