“Intrapreneurship” key to innovation, growth in recovery: EY
(Toronto – 17 November 2010) A new survey released by EY during Global Entrepreneurship Week reveals an overwhelming majority of participants (82%) strongly agree that the ability to innovate is critical to the growth of their organizations during economic recovery. Yet almost half of respondents also say that generating innovative ideas becomes more difficult as their organizations grow in size and complexity.
“Large and well-established companies often comprise rigid structures that can stifle the entrepreneurial spirit,” says Colleen McMorrow, Leader of EY Canada’s Strategic Growth Markets practice. “As Canada’s key industries enhance their presence on the global stage, businesses need to foster and encourage “intrapreneurship” (entrepreneurial thinking within the company), in order to maintain a competitive edge.”
Igniting innovation: how hot companies fuel growth from within examines the secrets of successful intrapreneurship, and its vital role in the economic recovery. The report polled 263 of the world’s leading entrepreneurs (all winners of EY’s Entrepreneur Of The Year® Awards), and identifies six strategies of effective intrapreneurship:
1) Set up a formal structure for intrapreneurship. It’s critical to give people enough time away from their day jobs to work on creative ideas, while setting up formal processes to make sure those ideas go somewhere.
2) Ask for ideas from your employees. Encourage everyone from all ranks and functions to contribute to the innovative process.
3) Assemble and unleash a diverse workforce. Statistical research has established that drawing on people from different backgrounds with diverse viewpoints results in better ideas and better products.
4) Design a career path for your intrapreneurs. As they tend to dislike conventional administrative jobs, look for non-traditional ways to advance their careers.
5) Explore government programs and incentives. Don’t ignore the growing number of state-sponsored programs that support entrepreneurial ventures. Step up efforts to obtain government funds for innovation.
6) Prepare for the pitfalls of intrapreneurship. Backing bold ideas can backfire. Be prepared to deal with failed ventures, internal conflicts, financial risks and intellectual property battles. Set risk limits up-front.
Following these guidelines can help companies free up organizational gridlock and establish a supportive environment that fosters the creative process. However, the report cautions that success is dependent on support from senior management and a framework that views intrapreneurship as an end-to-end process.
“Intrapreneurs in Canada need encouragement, support and resources, as well as the freedom to fail without repercussions,” says McMorrow. “The best way for a company to foster creative thinking is to tap resources it already has — its people. Encouraging the development of high-risk, high-reward ideas within the safety and support of an established organization is what lies at the heart of intrapreneurship.”
The report finds that in the face of fierce global competition, companies need to be increasingly agile in order drive growth. By institutionalizing intrapreneurship so that it becomes an inseparable part of a company’s operations, companies can enable the innovation process, and hang on to market leadership positions.
EY is a global leader in assurance, tax, transaction and advisory services. Worldwide, our 141,000 people are united by our shared values and an unwavering commitment to quality. We make a difference by helping our people, our clients and our wider communities achieve their potential.