An article I read today titled Intrapreneurship Is A Myth – Here Is Why prompted me to draft a response because I could not disagree more with the author. Being one of those intrapreneurs, whom the author claims to be mythical, here is my counter-argument.
Large organizations innovate and renew themselves constantly. However, their innovation and renewal are focused on operational efficiency, profitability and maximizing return on investment while minimizing risk. This focus limits typical innovation in large organizations to incremental ones. Large companies rarely excel in disruptive innovation.
My first argument is that intrapreneurs are real, not mythical, but their focus is different from that of entrepreneurs. For example, Toyota’s revolutionary manufacturing system is the end-result of multiple intrapreneurs, who brought innovation in a very established sector and changed many principles that were considered “basic.”
My second argument is that intrapreneurs do deliver disruptive innovation in large organizations but not using the same approach as entrepreneurs. For example, the author states that “if intrapreneurship really worked, success as a startup would be almost impossible.” I think this is far from reality because sometimes intrapreneurs and large organizations leave certain initiatives to those who can do it better. For example, return on investment on a new initiative may not be attractive to a large organization even though they would be interested in it if someone built it. This is an opportunity for entrepreneurs. Recently, one of my start-ups completed a deal with a large multi-national on a product. While the multi-national acknowledged its need for the product years ago, it lacked skills, infrastructure, and logistics to develop the product. Instead, intrapreneurs at the multi-national sponsored a few entrepreneurs (I happen to be on the entrepreneurial side in this case) to develop the product. The multi-national brings in its expertise in global distribution and sales, thus creating a viable business.
And, one last example, directly from my past experience. When a multi-national organization decided to enter a new field, it hired a few people with the right skills and mindset (I was one of those new hires), established a partnership with a start-up, which was working on a promising technology and let the team go for it. The R&D team working on the project operated under its own rules, with its own leader, and separate from the company’s operational processes. The end-result was a breakthrough product in the a market that was new to this multi-national company.
In summary, intrapreneurship is real and it works. It is, however, not an entrepreneur in a large organization doing what an entrepreneur does at a start-up. An intrapreneur behaves like an entrepreneur but has to deal with a very different reality. As a result, produces different outputs.
I welcome your comments on my blog. Please share this posting if you find it helpful. If you have any questions, comments or thoughts, I would love to hear from you.
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