Intrapreneurship & IT Industry


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Managing Corporate Intrapreneurship

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Intrapreneurship & IT Industry

  1. 1. Submitted by: Mayank Singh MBA Entrepreneurship & Leadership
  2. 2. <ul><li>Various terms have been used in literature to describe Corporate Entrepreneurship including </li></ul><ul><ul><li>Intrapreneurship </li></ul></ul><ul><ul><li>Internal Corporate Entrepreneurship </li></ul></ul><ul><ul><li>Corporate Ventures </li></ul></ul><ul><ul><li>Venture Management </li></ul></ul><ul><ul><li>New Ventures and Internal Corporate Venturing . </li></ul></ul>
  3. 3. <ul><li>Intrapreneurship a process whereby an individual or a group of individuals, in association with an existing organization, create a new organization or innovation within that organization. </li></ul>
  4. 4. <ul><li>To understand corporate entrepreneurship, we must first look at its parent, “start-up” entrepreneurship. </li></ul><ul><li>Entrepreneurs are generally associated with start-up businesses. </li></ul><ul><li>Heroes of culture, determination, and risk-taking seem to allow them to do amazing things — Bill Gates, creating Microsoft, Henry Ford, the mass produced automobile, and Jeff Bezos, founding </li></ul>
  5. 5. <ul><li>They identify opportunities, shape and develop these opportunities, and then they create a business structure to turn these opportunities into successful business ventures. </li></ul><ul><li>The starting point is a new idea. </li></ul><ul><li>This new idea could be revolutionary or evolutionary and it might not even be theirs, but there is something unique about it. </li></ul>
  6. 6. <ul><li>Entrepreneurship: start up or new company ventures, all of which tend to happen outside a conventional organization. </li></ul><ul><li>Intrapreneurship: entrepreneurial behavior within an organization and a different but overlapping skills set is required. </li></ul>
  7. 7. <ul><li>Intrapreneurs act as both manager and entrepreneur </li></ul>
  8. 8. <ul><li>Big companies are turning towards corporate entrepreneurship because they are not getting the </li></ul><ul><ul><li>continual innovation </li></ul></ul><ul><ul><li>Growth </li></ul></ul><ul><ul><li>value creation that they once had </li></ul></ul>
  9. 9. <ul><li>Corporate Venturing : Involves starting a business within a business, usually sourcing from a core competency or process. </li></ul><ul><li>A bank, for example, which has a core competency in transaction processing, turns this into a separate business and offers transaction processing to other companies who need mass processing of information. </li></ul>
  10. 10. <ul><li>Intrapreneuring: An attempt to take the mindset and behaviors that external entrepreneurs have, and inculcate these characteristics into their employees. Sometimes the company wants every employee to act like an entrepreneur.. </li></ul>
  11. 11. <ul><li>Organizational Transformation: T ransformation results in the development of new business opportunities. If the transformation involves innovation, a new arrangement or combination of resources, and results in the creation of sustainable economic value. </li></ul><ul><li>Eg. Dell Computers </li></ul>
  12. 12. <ul><li>Industry Rule-Bending: Bending is another type of transformation but focuses on changing the rules of competitive engagement. </li></ul><ul><li>Eg: Toyota, changed the way books are sold. Callyx and Corolla utilize the Internet and catalog sales to ship flowers directly from the grower to the customer. </li></ul>
  13. 13. <ul><li>The development of the Macintosh computer is seen as an intrapreneurial activity within Apple , Apple’s iPod also needs to be seen as intrapreneurial. </li></ul><ul><li> has forced Barnes and Noble to re-evaluate and change some key aspects of its business model. </li></ul><ul><li> has changed the way many people shop for groceries </li></ul>
  14. 14. <ul><li>Autobytel has forced GM and others to put up their own websites in direct competition with their own dealers. </li></ul><ul><li>Nortel Networks, a leader in high growth, high-technology sector, recognizing that it’s extremely difficult to initiate new businesses outside the existing divisions, created the Business Venture Programme </li></ul>
  15. 15. <ul><li>Wipro came up with initiative “Innovation@Wipro” which encourages bottom up innovation through a collaborative working model. </li></ul><ul><li>In HCL Technologies founder Shiv Nadar who provided the early support to Rajendra Pawar and Vijay Thadani to set up NIIT, which became a pioneer in the field of IT education in India. </li></ul>
  16. 16. <ul><li>The company was set up in 1987 to offer solutions and services in computer applications </li></ul><ul><li>It grew from 150 employees in 1996 to over 8300 in March 2001, and from USD 11 million in terms of turnover to USD 240 million for the same period </li></ul><ul><li>It has operations in 35 countries with a number of Fortune 500 companies as its clients. </li></ul>
  17. 17. <ul><li>As part of managing such phenomenal growth, organizationally Shree was restructured into a number of decentralised divisions, called Circles </li></ul><ul><li>An In-charge-Circle (ICC) heads each Circle; however, all ICCs need not necessarily be at the same level in terms of organisational hierarchy </li></ul>
  18. 18. <ul><li>Shree has been able to create a flat organisation. </li></ul><ul><li>Facilitated creation of new Circles even by fairly junior people where growth opportunities exist. </li></ul><ul><li>Though it is decentralised, some of the services such as Finance, HR and Corporate Communication are centralized, called Strategic Service Units. </li></ul>
  19. 19. <ul><li>A major advantage of such circular, flat structure </li></ul><ul><ul><li>Flexibility it provides to have organic growth by creating new Circles as spin off from the existing, depending on the product market requirements </li></ul></ul><ul><ul><li>Encouraging all employees to come out with suggestions for improving existing tools and creating new tools </li></ul></ul><ul><li>Each Circle operates as a independent “entrepreneurial venture” </li></ul>
  20. 20. <ul><li>Though growing rapidly, Google still maintains a small company feel </li></ul><ul><li>Google's emphasis on innovation and commitment to cost containment means each employee is a hands-on contributor. </li></ul><ul><li>Environment it has feel like being on the campus of a fortune 500 company, more like a college campus loaded with free thinkers. </li></ul>
  21. 21. <ul><li>They are really concerned that their employees can be a self starter </li></ul><ul><li>If employee runs into a problem, he should be able to focus on that problem without intervention or pausing the entire task hoping someone else will help him </li></ul><ul><li>It’s like college, employees have to be able to problem solve on their own, not simply stop and hope another team member can fix it for him </li></ul>
  22. 22. <ul><li>Ex-Google employees cash in on their company stock to start businesses. </li></ul><ul><li>There are many enterprises funded by Google and there ex employees running them. </li></ul><ul><li>The Google way of thinking is better since it does not focus on a specific place, but allows innovation and entrepreneurship to grow within the whole organisation. </li></ul><ul><li>Google maps, Gmail, Orkut etc. are the result of Intreprenurship at Google </li></ul>
  23. 23. <ul><li>Yahoo has initiated a project called Brickhouse. </li></ul><ul><li>The project is essentially an in-house incubator meant to give it’s entrepreneurial employees another reason to stick with the company. </li></ul>
  24. 24. <ul><li>Intel recently launched an innovation program called Systemic Innovation to foster and encourage innovation throughout Intel’s IT organisation. </li></ul>