Intrapreneurship is the art of managing organizational resources within an established firm as a new company would, by developing new ideas, products, and business models in a flexible and flat organization. The practices and behaviors of intrapreneurs allow their organizations to drive value and growth faster than an average organization would.
Intrapreneurs are the key agents of change that enable open innovation at the firm. These intrapreneurs are skilled at managing teams and developing products and technologies while creating customer opportunities.
Intrapreneurs are the spearhead of the firm testing of new products and markets. These teams behave like a start-up in a corporate setting, leveraging the flexibility and nimbleness of a start-up with the resources and capabilities of the small or medium company.
Intrapreneurs can be very effective for the organization to launch new products or to monetize non-core ideas either through internal commercialization or spin-outs. However, if not allowed to operate on a flexible, independent and entrepreneurial environment they can create havoc in the organization.
The following two examples show two different ways for corporations to work with intrapreneurs with very different results.
A chemical company R&D researcher develops a new thermoplastic polymer. This material has unique properties for niche applications, but it does not fit into the company’s portfolio.
The inventor wants to commercialize the material and suggests to the corporation a technology spin-out. The new firm will market the material under license and develop new products.
The spin-out company licenses the technology and starts to market new products based on the technology. The new firm becomes a successful small firm commercializing the technology in niche markets, creating value for the both the chemical company and the spin-out company.
An automation company controls and electronics team has been developing a technology to for real time communication, management and analysis of manufacturing equipment. The company likes the product but does not share the commercialization urgency with the team.
The team wants to develop a product suite and market it to their customers, but the company does not quite know how to fit the technology development on its business model. The manager leaves the company and takes key team members with him.
The team establishes a start-up company to market factory information and management system. In the early stages of product development, they secure a customer pilot and venture financing for the start-up. Within 24 months the company has secured multiple rounds of funding and multiple pilots with global customers.
In the two real life examples both technologies have proven successful. But the approach shown by the chemical company improves employee morale and more importantly it generates value to the firm. On the other hand the automation company lost critical team members and was not able to monetize any of the previously funded work.
Intrapreneurs are a special breed of employees that help the firm grow and increase value through innovative thinking. These employees understand the need for a flexible workplace that allows for quick customer validation, the ability to pivot the business model and/or product while minimizing time to market.
Participate in our innovation survey and receive valuable, complimentary survey: Kinetik Innovation Survey. Look for the 2014 Innovation survey in Q4 2014.
For Further Contact:
Technology & Business Innovation
Tel: +1 248.924.5436