Intrapreneurial Culture and Competitivity Intrapreneurship and Innovation in Organizations Louis Jacques Filion Rogers-J.A. Bombardier Chair of Entrepreneurship HEC Montreal SEBRAE Brasilia September 19, 2008 Intrapreneurial Culture and Competitivity Intrapreneurship and Innovation in Organizations Louis Jacques Filion Rogers-J.A. Bombardier Chair of Entrepreneurship HEC Montreal SEBRAE Brasilia September 19, 2008

What is Intrapreneurship Intrapreneurship is entrepreneurship applied within organizations Like entrepreneurship, it involves: - Recognition of opportunities - Project design and implementation - Innovation - Risk management - Added value Intrapreneurship is entrepreneurship applied within organizations Like entrepreneurship, it involves: - Recognition of opportunities - Project design and implementation - Innovation - Risk management - Added value

The five “I”s of Intrapreneurship Information Intention Imagination Implementation Innovation

The intrapreneurial process is similar to the entrepreneurial process It is more complex because it is applied in a context where the intrapreneur does not have control over the social system The intrapreneurial process is similar to the entrepreneurial process It is more complex because it is applied in a context where the intrapreneur does not have control over the social system Intrapreneurial Process

Entrepreneurial Process Innovatio n Opportunity Recognitio n Risk Added Value Use of ressource s Actio n

Intrapreneurship is more easily applied in a context of corporate entrepreneurship Intrapreneurship Characteristics of intrapreneurs are similar to those of entrepreneurs Involves the development of intrapreneurial, projective and visionary thinking Requires entrepreneurial and intrapreneurial competencies Characteristics of intrapreneurs are similar to those of entrepreneurs Involves the development of intrapreneurial, projective and visionary thinking Requires entrepreneurial and intrapreneurial competencies

Intrapreneurial Culture (1) ¤ Valorize innovation: new ways of doing ¤ Employees have a higher level of responsibility ¤ Focus on clients ¤ Importance of learning ¤ Support “doers” ¤ Valorize innovation: new ways of doing ¤ Employees have a higher level of responsibility ¤ Focus on clients ¤ Importance of learning ¤ Support “doers”

Intrapreneurial Culture (2) ¤ Tolerance of mistakes in the wake of risk management, not stupidity ¤ Values the presence of entrepreneurs ¤ Rewards success ¤ Shares the earnings ¤ Tolerance of mistakes in the wake of risk management, not stupidity ¤ Values the presence of entrepreneurs ¤ Rewards success ¤ Shares the earnings

Structures that Facilitate Intrapreneurial Expressions Small units: 200 people Organic organizational architectures Lean organizations (few managers) Project management Project design Project implementation Intrapreneurial training Intrapreneurial mentoring Small units: 200 people Organic organizational architectures Lean organizations (few managers) Project management Project design Project implementation Intrapreneurial training Intrapreneurial mentoring

Intrapreneurship is Action Oriented Difference between action orientation and activism Action orientation means: - Thinking - Preparation - Planning - Implementation - Results Difference between action orientation and activism Action orientation means: - Thinking - Preparation - Planning - Implementation - Results

Intrapreneurial Thinking and Visionism Mental representation of self and of environment plays a key role Requires a very accurate knowledge of the sector Systemic thinking that relates parts and combines them to form a whole is a must Mental representation of self and of environment plays a key role Requires a very accurate knowledge of the sector Systemic thinking that relates parts and combines them to form a whole is a must

Visioners Visionaries Visioners Visionaries and Visioners

Visioners Visionaries Visioners Visioners and Visionaries

Communications Training Mecanism to support intrapreneurial initiatives E.g.: 3 M Culture Commandments Rules Mentoring Coaching Use of external consultants and specialists Evaluation criteria for intrapreneurial suggestions Sharing of the results Intrapreneurial Practice

The Intrapreneur’s 10 Commandments (1) 1) It is easier to ask for forgiveness than for permission 2) Do any job needed to make the project work, regardless of your job description 3) Come to work each day willing to be fired 4) Recruit a strong team 5) Ask for advice before asking for resources 1) It is easier to ask for forgiveness than for permission 2) Do any job needed to make the project work, regardless of your job description 3) Come to work each day willing to be fired 4) Recruit a strong team 5) Ask for advice before asking for resources

The Intrapreneur’s 10 Commandments (2) 6) Spread credit wide and celebrate victories 7) When you bend the rules always keep the best interests of the company and customers in mind 8) Recognize and honor your sponsors 9) Underpromise and overdeliver 10) Be true to your goals but realistic about ways of achieving them Gifford Pinchot 6) Spread credit wide and celebrate victories 7) When you bend the rules always keep the best interests of the company and customers in mind 8) Recognize and honor your sponsors 9) Underpromise and overdeliver 10) Be true to your goals but realistic about ways of achieving them Gifford Pinchot

Gathering of information Market surveys Sector analysis Understanding consumers’ needs and trends Vision design Project design Business Plans Feasibility studies Market testing Management of Intrapreneurial Projects

Fight the Corporate Immune System (1) Identify elements of resistance to change Identify prohibited subjects of communications Identify subjects that are regarded as negative Identify subjects that contribute strong biases to the way the organization and the market are seen Identify elements of resistance to change Identify prohibited subjects of communications Identify subjects that are regarded as negative Identify subjects that contribute strong biases to the way the organization and the market are seen

Fight the Corporate Immune System (2) Identify subjects that do not allow people to act Identify subjects that prevent people from taking action Identify viewpoints that will lead people to oppose changes Identify subjects that do not allow people to act Identify subjects that prevent people from taking action Identify viewpoints that will lead people to oppose changes Be subtle and find ways to counteract all these elements

Counteract Morphine Effects Things and people that are in your environment but that you do not see Attitude that prevents learning from environmental changes Indifference to changes “Sleeping mind” attitude where people act as if they were asleep Insensitivity to what is happening Things and people that are in your environment but that you do not see Attitude that prevents learning from environmental changes Indifference to changes “Sleeping mind” attitude where people act as if they were asleep Insensitivity to what is happening Wake things up and get things moving

Some characteristics of entrepreneurs Involved Adaptable Resourceful Innovative Sensitive to environment changes Tolerance to risk Sector Knowledge Action oriented Some characteristics of intrapreneurs Conservative risk takers Extensive relations network inside and outside the firm Knowledge of the limits of what is acceptable Push things as far as they will go Users of resources Focus on results Characteristics of Intrapreneurs The same as those of entrepreneurs, plus a few more

☻ When I was a teenager, I came early to work to be able to type dreams I wanted to achieve. For example, “I will make one million ships, one million Brazilian planes”. I was determined to carry the Brazilian flag all over the world. I loved to dream. Emerson de Almeida Intrapreneurs/Entrepreneurs Dreamers who do

☻ You can recognize intrapreneurs. They are passionate about new ideas and eager to keep learning. Contrary to managers, they get bored doing repetitious tasks. Serban Teodoresco Intrapreneurs Creative doers

☻ My father is my friend. We planted hundred of trees together. For each tree, you need a hole of 60X40 centimeters. He works with precision. If you need 60 centimeters, it is not 59 or 61, it is 60. Emerson de Almeida Intrapreneurs/Entrepreneurs Precision Workers

Technical Competencies Knowledge of sector Knowledge of products Knowledge of markets Understanding of users needs Conceptual Competencies Systems thinking Analytical capabilities Entrepreneurial thinking Projective thinking Visionary thinking Project design Managerial Competencies Risk management Communication Polyvalence Networking abilities Negotiation Task orientation People orientation Intrapreneurial Competencies

Intrapreneurship and Mentoring Mentoring program, often using dual mentoring: internal and external mentors Training Use of outside consultants Mentoring activities to be completed by coaching activities Mentoring program, often using dual mentoring: internal and external mentors Training Use of outside consultants Mentoring activities to be completed by coaching activities

Intrapreneurial Advisory Board Advisory board includes members from inside and from outside (entrepreneurs) Appointment of one person to be responsible for entrepreneurial activities (often part time) (+ budget) Small advisory boards will eventually be structured around each project Advisory board includes members from inside and from outside (entrepreneurs) Appointment of one person to be responsible for entrepreneurial activities (often part time) (+ budget) Small advisory boards will eventually be structured around each project

From Intrapreneurship to Extrapreneurship Intrapreneurship and entrepreneurship are forms of leadership Intrapreneurs learn what is to be learnt to start a business In fact, many intrapreneurs become business unit managers within existing corporations Intrapreneurs will become top managers, entrepreneurs or will move on to other intrapreneurial challenges Intrapreneurship and entrepreneurship are forms of leadership Intrapreneurs learn what is to be learnt to start a business In fact, many intrapreneurs become business unit managers within existing corporations Intrapreneurs will become top managers, entrepreneurs or will move on to other intrapreneurial challenges

From Intrapreneurship to Spin-offs The current trend towards subcontracting is leading organizations to develop spin-off programs Intrapreneurs can become extrapreneurs Extrapreneurs are more likely to succeed Mentors and coaches can remain the same Advisory boards can sometimes remain the same The current trend towards subcontracting is leading organizations to develop spin-off programs Intrapreneurs can become extrapreneurs Extrapreneurs are more likely to succeed Mentors and coaches can remain the same Advisory boards can sometimes remain the same

Intrapreneuring as a Strategic Option Corporations are opting for intrepreneuring to sustain growth instead of achieving it through external acquisitions Intrapreneuring can be done at all levels of organizations Corporations are opting for intrepreneuring to sustain growth instead of achieving it through external acquisitions Intrapreneuring can be done at all levels of organizations

Conclusion (1) Organizations need intrapreneurs as much as societies need entrepreneurs Intrapreneurial systems can be developed in the same way entrepreneurial systems Intrapreneurship leads to sector leadership Intrapreneurship remains one of the best remedies to fight the morphine effects Organizations need intrapreneurs as much as societies need entrepreneurs Intrapreneurial systems can be developed in the same way entrepreneurial systems Intrapreneurship leads to sector leadership Intrapreneurship remains one of the best remedies to fight the morphine effects

Conclusion (2) To be successful, intrapreneurial activities have to be managed very rigourously There are levels in intrapreneurial expression and we have reached a point where every manager needs to be able to express some level of intrapreneuriability Most managers and strategists can benefit from intrapreneurial training To be successful, intrapreneurial activities have to be managed very rigourously There are levels in intrapreneurial expression and we have reached a point where every manager needs to be able to express some level of intrapreneuriability Most managers and strategists can benefit from intrapreneurial training

Intrapreneurship is a win-win process Organizations need to engage in corporate entrepreneurship practice to benefit from the intrapreneurial potential of their employees Corporate entrepreneurship facilitates intrapreneurial expression and generates an entrepreneurial culture Organizations need to engage in corporate entrepreneurship practice to benefit from the intrapreneurial potential of their employees Corporate entrepreneurship facilitates intrapreneurial expression and generates an entrepreneurial culture Conclusion (3)

Intrapreneurial Culture and Competitivity Muito obrigado Many thanks Merci beaucoup Muito obrigado Many thanks Merci beaucoup