Corporate entrepreneurship: teaching managers to be entrepreneurs

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JMD22,4340in their peer’s behavior difficult to cope with. We uncovered severalinstances of peers going to their joint boss to complain that theentrepreneur was not holding up his/her part of the workload andtherefore should be taken out of the entrepreneurial training program.The bosses on the other hand had not seen this supposed downturn inproductivity.(4) The fourth and biggest obstacle was the corporate entrepreneur’s directline boss. In all four of our companies, senior management wascommitted to trying to create greater innovation and new businessdevelopment through the development of corporate entrepreneurship.Unfortunately, many of the bosses a level or two down from these seniorexecutives were not so committed. We had numerous reports of directline bosses telling their managers in our program to “forget what youwere taught, all I care about is meeting our quarterly results”. It oftentook strong executive team intervention to dissuade these direct bossesfrom acting in this manner. Obviously many of these direct bosses wereeither poorly informed about what the company was trying to do, or theyhad not bought into the processes for obvious and often legitimatereasons.Does corporate entrepreneurship really make a difference?First, let’s look at what success means. One end of the continuum would be achange in the manager’s behavior, which fosters more innovation, creativeproblem solving, and circumvention of red tape. The manager is not really acorporate entrepreneur in terms of creating a new business venture, but he orshe is now much more appreciative of the importance of new ideas, and thenacts to create a more innovative culture for his/her employees. We have createdan experimental Entrepreneurial Orientation Survey, which we hope will allowus to assess this type of change in behavior from a pre/post programperspective. As previously stated, there is some fairly strong evidence thatacting more entrepreneurially as a manager can have a significant impact onboth attitudinal and financial measures, even if the manager does not create anew business (Pearce et al., 1997).At the other end of the spectrum is the creation of a completely newbusiness, which is durable and generates a great deal of money for theorganization, much like the returns venture capitalists seek.But, at the end of the day, the real test of a corporate entrepreneurshiptraining is whether significant new businesses or new business results fromthis type of educational immersion. As one might expect, we have severalspectacular successes and many failures. But, perhaps our sample ofstatistics from these four companies is no different than what would beexpected from looking at the number of successful ventures funded byventure capitalists.
First, a couple of the spectacular successes:(1) One of our managers-turned-entrepreneur proposed a new business thatwould focus on oil company distributors to help them manage both frontand back end logistics better. In addition, his new business was one ofthe first to create the “speed pass” idea that allows motorists to wave amicrochip in front of the gas pump as a method of payment. Within thefirst three years of his new company’s creation, it was grossing over 250million dollars in revenues.(2) Another example involved an entrepreneurial team whose innovativeidea of turning waste oil products into a new business for xxxx resultedin yyyy revenues.Clearly, these examples are impressive and they happened in companies wherethe overall cultures were not particularly entrepreneurial, thus dispelling thenotion that cultural change has to happen before the fruits of entrepreneurialinterventions can be realized. But, they must also be seen in the light of theoverall approach to training entrepreneurs. Over the past six years we haveprobably run corporate entrepreneurship programs for well over 1,000 managers.While many of these managers describe the educational process and thedevelopment of a business plan as the most significant business educationexperience they have ever had, relatively few, perhaps 10-15 percent of theseentrepreneurial plans ever led to successful new ventures. Again, this data seemsto square with the notion that most (90 percent) new start-up businesses fail.The deck seems to be stacked equally against corporate entrepreneurs aswell as start-up entrpreneurs. On the other hand, the venturing process doesresult in the generation of many new ideas, the education of people regardingdifferences between good ideas and good opportunities, and many times newcorporate knowledge and competencies which did not exist before. Ourexample of the thumb-printed credit card created new technologicalcompetencies that have been leveraged elsewhere within the company. It isunlikely that this technology would have been commercialized had Siemens notempowered this manager to think and act in a more entrepreneurial manner.Lessons learned.Pockets or islands of entrepreneurial activity can develop and thrive, atleast for a while, in cultures that are not in themselves entrepreneurial.Clearly, researchers are right when they claim that organizational cultureplays a key role in a company’s ability to develop corporateentrepreneurship (Morris, 1998; Hood and Young 1993; Bygrave, 1997).But, successful ventures can develop in non-entrepreneurial companieswith the right kind of tactical interventions. This is good news forcompanies who are told that it takes five to eight years to change culture.Perhaps, it only takes a critical mass of switched-on corporateCorporateentrepreneurship341
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Corporate entrepreneurship: teaching managers to be entrepreneurs

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