2-1 © 2005 The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin

2-2 Chapter 2 The Entrepreneurial and Intrapreneurial Mind

2-3 Entrepreneurial Process 1)Identify/Evaluate Opportunity 2)Develop Business Plan 3)Determine Resources Required 4)Manage The Enterprise McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.

2-4 Opportunity Analysis  Market Need?  Personal Observation  Underlying Social Conditions  Market Research Data  Assess Competition- Patents?  Where Money To Be Made

2-5 Decision Making Manager vs. Entrepreneur  Domain- Administrative vs. Entrepreneurial  Strategic Orientation  Commitment to Opportunity  Commitment of Resources  Control of Resources  Management Structure

2-6 “Intrapreneurship” Instilling Entrepreneurial Spirit Within An Existing Organization To Innovate And Grow.

2-7 Organizational Culture Corporate Climate/Reward System Favors Conservatism Climate/Reward System Favors Conservatism Follow Instructions, No Initiative Follow Instructions, No Initiative Hierarchy Of Authority Hierarchy Of AuthorityIntrapreneurial Develop Vision, Goals, & Plans Develop Vision, Goals, & Plans Suggest, Try, Experiment Suggest, Try, Experiment Flat Organizational Structure- Networking & Teamwork Flat Organizational Structure- Networking & Teamwork

2-8 Cultural Norms/Values CorporateIntrapreneurial FragmentedWhole InstructionVision Controlled In Control Outer-DirectedInner-Directed AlienationResponsibility “Chores”Enthusiasm/Motivation Defined Limits Space/Freedom InterferenceTrust Distrust Belief In People ExpendableExpandable Limiting People Growing People

2-9 Interest In Intrapreneurship  Rising Interest in “Doing Your Own Thing”  Corporation  Support To Retain Creative Employees  Fund Startups  Hypercompetition  Corporate vs. Intrapreneurial Culture

2-10 Intrapreneurial Activities  New Business Venturing  Innovation  Self-Renewal  Proactive

2-11 Climate for Intrapreneurship TechnologyTechnology New Ideas EncouragedNew Ideas Encouraged Trial/Error EncouragedTrial/Error Encouraged Failure AllowedFailure Allowed No Opportunity ParametersNo Opportunity Parameters Resources Available & AccessibleResources Available & Accessible Multidiscipline TeamsMultidiscipline Teams Long Time HorizonLong Time Horizon Volunteer ProgramVolunteer Program Appropriate Reward SystemAppropriate Reward System Sponsors/Champions AvailableSponsors/Champions Available Support of Top ManagementSupport of Top Management

2-12 Intrapreneurial Leaders  Understand Environment  Have Vision/Flexibility  Create Management Options  Encourage Teamwork  Encourage Open Discussion  Build Coalitions  Persist

2-13 Establishing Intrapreneurship  Commitment of Top Management  Identify Ideas/Areas Interested In Supporting  Use Technology For Flexibility  Managers Share/Train Employees  Get Closer to Customers  Be More Productive With Less

2-14 Evaluating Intrapreneurship Proposals  Corporate Fit  Initial Investment  Experienced Venture Champion  Experience With Product/Service  Competitive Threat  Proprietary Technology  Gross Margin  Rate Of Return

2-15 Barriers To Intrapreneurship  Inherent Nature of Large Organizations  No Long-Term Commitment  Lack Of Autonomy For Decision Making  Lack of Intrapreneurial Talent  Inappropriate Compensation Methods  Constrained Environment