What are some practical strategies to foster a culture of innovation from within? 

To answer those questions, the consultancy firm Ernst & Young conducted a series of global surveys of senior business leaders as well as interviews with leading academics and industry authorities.

E&Y, according to the survey, found that effective intrapreneurship involves six tactics. The consultant put it as listed below :

1. Set up a formal structure for intrapreneurship. Give people enough time away from their “day jobs” to work on creative projects, but provide a formal process for new product development.
2. Ask for ideas from your employees. They have their fingers on the pulse of the marketplace. Encourage them to contribute to the innovation dialogue.
3. Assemble and unleash a diverse workforce. It’s no secret that diverse groups come up with more innovative ideas. Tap into this multifaceted source of power.
4. Design a career path for your intrapreneurs. For the most part, intrapreneurs are mavericks who will quit — and take their best ideas with them — if they don’t see prospects for career advancement.
5. Explore government incentives for innovation. Ask how these can support your intrapreneurial ventures. Governments all over the world are offering new tax breaks and other incentives for research and development (R&D) — and corporations in turn are urging governments to support innovation.
6. Prepare for the pitfalls of intrapreneurship. Not all ideas will produce successful new products. Failure is an important part of the process.

These strategies achieve a key goal: institutionalizing intrapreneurship so that it becomes an inseparable part of a company’s operations. Only then can the process of continuous innovation take place — allowing the company to stay a market leader.

(photo via http://www.bluenove.com/publications/blog/profession-intrapreneur/ )

This is the most striking intrapreneurial initiative taken by the telecom manufacturer. Intrapreneurship, thank a.o., to the program, is growing in popularity within the comany.

Olivier Leclerc will be a speaker at the European Intrapreneurship Conference 2011, held in Brussels, on december the 2nd 2011

Here is a video explaining the boostcamps.

Sujay Dutta wrote this guest blogpost, coming from is own blog, asking questions on Intrapreneurship that we take over on the blog of the Intrapreneurship conference, here below.

We may have all heard about Intrapreneurship – the term used for entrepreneurship within organizations, while operating within the organizational environment.

This term was first coined in 1978 from a paper written by Gifford & Elizabeth Pinchot. And still today, after 30+ years, it is a lesser known cousin of Entrepreneurship. We know the marquee successes of Intrapreneurship – like 3M’s Post-It Notes, Sony’s Playstations, Sun’s Java Programming Language, HCL’s Comnet division & many more.

And still, they are far lesser than the entrepreneurship successes we have seen in the past three decades, even though organizations have much more resources in terms of money, talent, experiences at their disposal as compared to entrepreneurs. The reasons for so could be the constraints that organizations operate in – competitive pressures, market pressures, stakeholder pressures etc. etc.

However, successful organizations in the long run would be the ones that could come out of this deadly strangulation by creating a culture of Intrapreneurial success within the organizations.

The case of big IT services companies

For this post, I would like to consider the case of Tier-1 IT Services organizations – having revenues of USD 3 Billion+ with 70000+ employees. Such organizations typically derive about 80% or more of their revenues from providing IT Services to enterprises (the balance of their revenues could be from Business/Technology Consulting, Product Development Services, BPO services).

With the favorable trends towards Cloud Services, much of the IT services revenues for these companies carry a high risk of getting wiped off in the next 5 to 10 years. That’s the challenge ahead of them in the Demand side.

These organizations are also exposed to significant challenges in the Supply side – the supply of talented skilled engineers and increasing salary costs.

How could these Tier-1 IT Services organizations balance the Demand-side and Supply-side challenges in the next 5-10 years, keep growing profitably and not get strangulated?

Let’s look at the positives/strengths of these organizations:

• These organizations are knowledge-based organizations. The value they create for their customers are created by their employees delivering services to their customers
• These organizations have an average employee age in the vicinity of 25 years
• These organizations have been growing very well in the past decade – with an average CAGR of about 30%
• These organizations have healthy balance sheets, with significant cash holdings
• These organizations , most likely, would have past examples of successful Intrapreneural ventures in the past – like HCL Comnet

Create a Venture capital arm

So, these organizations have all the necessary ingredients to start a “Venture Capital” arm – which could promote, encourage and foster a culture of Intrapreneurship – to help create the business lines of the future for themselves.

Organizations which could successfully do this might be able to emerge much stronger in the next 5-10 years; the rest might get strangulated to death or are gobbled by others.

The key question would be – Which of these organizations are able to take the Risks now?

We have received a lot of positive feedback from a very enthusiastic crowd, excited by the topic. However, many SME’s told us that the pricing to attend the conference, was an issue for them, especially as they are getting ready for a struggle with the tough economical conjuncture expected in the coming months.

So, instead of having an event which could have been perceived as too exclusive, by some, we made the decision to take on a substantial price reduction for those who will register in the coming days (200 € instead of 520 € excl. VAT).

The content of the conference will remain as qualitative as showcased on the event’s website. The conference agenda will feature great testimonials from some of the best Intrapreneurship experts in Europe as well as some interactive and engaging  sessions

Intrapreneurship, will definitely drive the future of many companies. On one hand, intrapreneurship can boost the innovation potential of any company. On the other hand, it broadens the perspectives of all talented workers who, empowered, will gain in motivation and well being. Which makes, Intrapreneurship is maybe one of the best HR practice ever implemented.

We are looking forward to welcome you at the Intrapreneurship conference on December 2nd at the Hub Brussels.

The organizers,

www.intrapreneurshipconference.com

Hard to say.

E.J. Reedy, from the Kaufman Foundation, thinks it’s possible. Though, he notices the existence of differences according between a number of countries surveyed by the Global Entrepreneurship Monitor (GEM).

“Intrapreneurship is a concept that GEM has measured for some time in their screener at the national level but this new effort to conceptualize and inquire at the household level in Brazil, Chile, Ecuador, Iran, Republic of Korea, Latvia, the Netherlands, Norway, Peru, Spain, and Uruguay stands out for going into greater depth than previous work.  Specifically, the scholars have screened for intrapreneurship using the following logic process”.

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“The authors come to the conclusion that “on average, less than 5 percent of employees are intrapreneurs, and that in most countries its incidence in the adult population is significantly lower than that of early-stage entrepreneurial activity,” but probably more importantly to me is their finding that “the prevalence of intrapreneurship is about twice as high in high income countries as in low income countries.”

“This makes a lot of sense since higher-income countries tend to have larger business organizations and thus the likelihood that a working age individual is employed at large business organization increases as countries develop.  But on a related topic, I am puzzled by their finding that the prevalence of intrapreneurs increases with the size of the business”.

Read the rest of the post here

He reminds us of the story of the Sony PlayStation, an intrapreneurship adventure carried out by Ken Kutaragi, an electrical engineer hired by Sony in 1975. Here is an excerpt :

Ken Kutaragi was working in the sound labs at Sony Corporation when he bought his young daughter a Nintendo game console. Ken observed his daughter playing with the new Nintendo game but he was displeased with the quality of the sound. (…) Ken concluded that a digital chip, dedicated solely to sound, would significantly improve the quality of the Nintendo gaming system.

Because the Sony Corporation was not involved in computer games, Ken Kutaragi negotiated to keep his job at Sony, while working as an outside consultant (entrepreneur) for Nintendo on their computer gaming devices. (…) After Ken’s success as a consultant to Nintendo the senior executives at Sony Corporation threatened to fire him. Fortunately for Ken, he had the strong support of Norio Ohga, the Chief Executive Officer of Sony Corporation. Chairman Ohga personally recognized the value of Ken’s creativity, entrepreneurial spirit, and innovation, so he encouraged Kutaragi’s efforts.

Then with the Sony Corporation CEO’s support (and begrudgingly the rest of Sony’s senior management’s blessing) Kutaragi continued to work as a part-time consultant to Nintendo. Ken successfully developed a CD-ROM-based system for Nintendo. Nintendo elected not to go forward with the CD-ROM system. Ken Kutaragi saw the market and business opportunity of computer gaming systems for Sony. With his Intrapreneurial spirit, Ken pressed hard to convince the Sony Corporation to enter the electronic gaming business.

While most of Sony’s senior management did not consider Ken’s computer gaming device more than a toy and not worthwhile for Sony, Chairman Ohga took a major chance and backed Kutaragi’s plan.

Ken was persistent and he went on to lead the effort to help Sony develop its own gaming system, which became the blockbuster product success “PlayStation”. (…) Ken Kutaragi fought against corporate “nea sayers” within Sony’s management ranks and Ken literally laid his job on the line at Sony to press for the creation of the computer gaming product within Sony (…)

Sony backed Ken’s corporate entrepreneurial (Intrapreneurial) venture by investing $2.5 billion into the PlayStation start-up, and has gone on to build over 70% of the home-video-game-console international market share. (…)

Ken’s Intrapreneurial (or corporate entrepreneurial) success has been called one of the greatest new business creations and launches in business history.  (…) The financial success of the Sony PlayStation was so impressive that by 1998, the PlayStation was providing 40 percent of Sony Corporation’s operating profits.

HCL Technologies is today considered as one of the most innovative company in the world in terms of management and new leadership approaches. The Indian IT firm has simply put the hierarchical pyramid upside down. Part of the new organisation principles of HCL corporate culture is based on Intrapreneurship.

Anand Pillai has been recently appointed to become a Member of the World Economic Forum’s Global Agenda Council on New Models of Leadership 2011, given his thought leadership in the field of Leadership & Innovation.

He was recently interviewed by the Smart CEO magazine to provide his own definition of what is Intrapreneurship. Here is an excerpt :

“An intrapreneur is an ideal employee – doing not just what his role demands, but providing and implementing ideas that take an organisation to the next level (…)”.

The program is responsible for developing the following products : Post-it Notes, Scotch Pop-Up Tape and 3M Multilayer Optical Film.  With proper organizational support and an incentive to take risks, intrapreneurship can greatly benefit companies. 

The 3M group provides grants as a part of its intrapreneurship and innovation program, within the 15% employee time. The “Genesis Grant”, for example, provides researchers of innovative projects up to ,000 to move those projects past the idea stage.

In another major company, IBM, the intrapreneurship program developed 25 new businesses within its first five years. In 2004, the 22 businesses that survived, generated over billion in revenue. Read also “IBM impact better results with intrapreneurship“.

Google, W.L Gore Technologies or HP have also similar programs, giving 10% to 20% of time for employees to pursue own ideas.

The Gmail meesaging system of Google or the Gore guitar strings made in synthetical material are initiatives born in the mind of regular employees who developped them within the “bootlegging” scheme.

In this video from the 2009 World Economic Forum in China, several executives give their opinions on intrapreneurship and how it can be used as a means to innovation in companies.

Source : Intrapreneur.com