Stephen Gall

Examples of Intrapreneural Success

Management 3106 – Entrepreneurship and Small Business

Professor Jim Smucker, Instructor

Walden University

November 14, 2006

Examples of Intrapreneural Success

Intrapreneural Traits

Instead of leaving a company to achieve entrepreneurial success, individuals can create innovation inside an organization. Innovating inside an organization can have advantages over going it alone, including financial safety for the contributors, easier access to start-up capital, support from internal experts, and access to all the required business tools and software needed to start a business.

The big challenge is facing resistance to change that the project may imply, especially if the company’s culture does not value risk. To face this challenge, the intrapreneur needs strong executive sponsorship.

Intraprenueurs tend to share some characteristics of entrepreneurs; they are willing to try new ideas, learn, and adjust accordingly. Also, intrapreneurs want to make a difference, feel a sense of purpose, and a need to improve the customer experience. But unlike entrepreneurs, intrapreneurs are usually not required to commit to personal risk. [Fantiman, 2002]

Examples of Intrapreneural Success

Sun Microsystems – Java
Sun Microsystems actively encourages intrapreneurship through its Advanced Development software division. When a project or a promising idea is proposed, a senior manager is specifically tasked with putting together an intrapreneural team specifically with the task of brainstorming ideas and identifying issues.

Visionaries at Sun are encouraged to come forward and share ideas, create mindshare among coworkers, and get support from management. It is often the case that intrapreneurs who have had success and a proven track record within Sun are able to get their projects funded quickly. [King, Jan. 2004] Ideas often lead to significant funding and the formation of a company in startup mode for bringing the ideas to market.

One way Sun encourages intrapreneurship is to post articles on its web site about how to be successful and develop intrapreneural qualities, such as: how to explain the technology to the non-technical, how to submit papers and present ideas and gaining visibility, how to get others involved, and, interestingly, how to reigning-in one’s passion.

Sun also allows fledgling projects to operate outside established product development rules, which might otherwise handicap a startup effort. [King, Mar. 2004]

Sun's most famous project was the development of the Java programming platform led by James Gosling and Patrick Naughton. Their original task was to figure-out what would be the next big change in computer programming languages. The project, code-named Oak, started small with limited resources, but quickly grew to 15 people. In just over a year, the group had completed and delivered a prototype and a project plan. [Gosling, 2006] [Feizabadi, 1998]

Boeing Company – The Phantom Works
In 1997, Boeing and McDonnell Douglas merged. McDonnell Douglas' Skunk Works was by then famous for producing advanced military prototypes. Boeing decided to continue the tradition by creating the Phantom Works and assigning a president with the mission of converting visions of the future of flight into reality. Boeing allowed the Phantom Works to develop into one of the most respected research and development organization anywhere. At any given time, there may be as many as 500 or more project in progress. Although many of these projects are never destine to become commercialized products, they often provide input to improving current production processes and improvements to current airplane design, or assembly techniques. Phantom Works is successful because it encourages futuristic thinking throughout the organization. [Volker, 2000]

One of the Phantom Works' key success components is collaboration with (Boeings’) business units, partners, government, and academic support, especially by encouraging technology transfer and sharing. Another key success factor is Boeing's Leadership Center, where managers can obtain entrepreneurial training and learn about how to encourage intrapreneurship.

Phantom Works' 4,000 workers are dedicated to creating breakthroughs in all areas of airplane design, performance, quality and cost. The Works wants to be known for innovation, and looks to develop or implement methods and technologies that help the organization meet that goal. [Bell, 2004]

The Works has demonstrated some amazing aircraft including unmanned air vehicles such as the X045A, the Bird of Prey, the Blended Wind Concept airplane such as the X50A Dragonfly, and the X43 Hyper-X space plane. [Cawthon, 2002]

3M – Culture of Innovation, the Post-It
3M Corporation makes over 55,000 products. It is a company that relies on innovation and therefore fosters a culture of creativity, risk taking, and trying new ideas. 3M also promotes the idea of persistence as a key component to innovation. In fact, 3M believes that it must be the world's most innovative company to ensure its very survival.

Key components of 3M’s success are employee satisfaction coupled with a climate of respect that encourages new initiatives. 3M uses the term 'inventorpreneurs' to describe a culture that recognizes that many new ideas must be tried before one idea leads to success. Therefore, 3M recognizes that failure must be tolerated.

Employees are encouraged to share ideas across projects and departments. This concept is what led to the creation of the Post-It note, when one co-worker overheard a group talking about an adhesive that failed to stick properly. The co-worker recognized an unintended application for the adhesive that wouldn’t stick properly, and it lead to the Post-It that 3M is known for today. [Gundling, 2000]

Apple Computer – The iPod
According to Steve Jobs, Apple Computer CEO, one key to success is saying 'no' to most ideas to concentrate on the really important things. Jobs must know because he has been at the forefront of technology, working with other innovators inventing the personal computer, the graphical user interface, and recently, the iPod.

For many years, Apple's culture was focused on finding breakthrough ideas. But often Apple then failed to capitalize on those ideas. Consequently, competitors moved-in before Apple could react. Apple realized that it takes more than just having the ability to develop product ideas; those ideas must be turned into products. Apple's 'heedless reverence for innovation' was actually limiting its ability to follow-through, and product successful products. Apple found itself in the unique position where an over emphasis on creativity was leading to pointless innovation. [Frey, 2003]

Although Apple has always relied on a product-oriented culture with a strong central focus that brings ideas together, Apple now concentrates on single-minded focus once a direction is chosen. Apple has recognized that if too many ideas are pursued, then focus can be lost. Apple also puts engineering and product focus ahead of marketing and sales. Apple takes a disciplined approach to solving specific problems by fostering a climate of innovation and formulating new ideas, and as long as the focus stays 'on track,' thinking 'different' (a previous Apple motto) is highly encouraged. [Burrows, 2004]

Intrapreneural Success Factors

What are some of the factors that lead to intrapreneural success? Using a survey from InfoPool [InfoPool, 2006] and the article, "On the way to creativity: engineers as intrapreneurs in organizations," [Aaltio, 2006] we can identify the following factors:

1. Intrapreneurs have a clear vision of the future, where the company is headed, and what the company is trying to accomplish. The organization tends to think well into the future. For the intrapreneur, their innovation has a context in which they can direct their efforts.
2. The organization tolerates risks, mistakes, and even failure. The organizational culture understands the learning process from experience, so mistakes are not covered-up; rather, learning from mistakes is encouraged.
3. Intraprenuership is encouraged and intrapreneurs are seen as visionaries who can turn ideas into profits. Their leadership is valued.
4. Intrapreneurs find support, protection, resources and even coaching from management.
5. The organization is willing to support cross-disciplinary project teams to enhance the probability of innovation and success. Teams often include people from marketing, engineering, and technical subject experts.
6. Decisions remain within the intrapreneural team and are not pushed up the organizational chain.
7. Intrapreneurs are given the discretionary time that is needed to explore their ideas without needing permission
8. Intrapreneurship can be self appointing, and intrapreneurs can recruit other team members. People aren't appointed to innovation roles.
9. There is a hands-off policy such that intrapreneurial project knowledge is not given to other professional managers who then run the project
10. Innovators can cross organizational boundaries without interference from bureaucratic management
11. There is a strong sense of organizational community as a whole, and this community provides a support base, viewing innovation as a worthwhile end
12. The corporate culture is driven by a sense of constantly improving customer service, understanding the customer, and better meeting customer needs, as opposed to internal politics
13. The organization is willing to find ways to provide essential services and resources to projects, even if it needs to rout around blocking issues
14. The organization is willing to develop new performance measurements and metrics that match the type of innovation being tried
15. Information flows freely among the team and is not bottlenecked or restrained by unnecessary constraints, rules, or management practices. Truthful communication and openness is encouraged.
16. Innovators, as all employees, are treated with loyalty and feel safe in providing input to innovation
17. The organization has a strong commitment to ethical responsibility, and attracts employees who have a commitment to serving customers and improving the world
18. The organization is willing to provide support to innovation that leads to small successes, and is not always looking for home runs

Bibliography

Fentiman, Faye, "Why you don't have to leave the organization to become an entrepreneur," Women Entrepreneurs in Science and Technology Newsletter issue # 2, Oct. 2002, http://westorg.org/nl/featured_articles/intrap_ff_102202.html

King, Carla, "Intrapreneurship: Heady Business," Sun Developer Network, Jan 2004, http://developers.sun.com/toolkits/articles/intrapreneur.html

King, Carla, "Intrapreneurship: From Incubation to Spin Out," Sun Developer Network, Mar. 2004, http://developers.sun.com/toolkits/articles/intrapreneur2.html

Gosling, James "A brief History of the Green Project," 2006, bolgs.sun.com, http://today.java.net/jag/old/green/

Feizabadi, Shahrooz, "History of the World Wide Web," WWW Beyond the Basics, Prentice Hall, 1998, http://ei.cs.vt.edu/book/chap1/java_hist.html

Thomalla, Volker, "Boeing's Phantom Works," Flug Revue Online, 2000, http://www.flug-revue.rotor.com/FRHeft/FRH0010/FR0010f.htm

Bell, William, "Boeing's Phantom Works Works," High Performance Wire, Vol. 13, No. 48, Dec. 2004, http://www.taborcommunications.com/hpcwire/hpcwireWWW/04/1203/108896.html]

Cawthon, Bill, "The Phantom Works: Where Dreams Take Flight," Promotex Online, Nov. 2002, http://www.promotex.ca/articles/cawthon/2002/11-01-2002_article.html

Gundling, Ernest, "The 3M Way to Innovation: Balancing People and Profit," Kodansha International, Jan. 2000, ISBN: 4770024762, http://www.amazon.com/3M-Way-Innovation-Balancing-People/dp/4770024762

Frey, Chuck, "Apple Computer and the Limits of Innovation," Innovation Weblog from Innovation Tools, Dec. 2003, http://www.innovationtools.com/Weblog/innovationblog-detail.asp?ArticleID=334

Burrows, Peter, "The Seed of Apple's Innovation," Business Week Online, Oct. 2004, http://www.businessweek.com/bwdaily/dnflash/oct2004/nf20041012_4018_db083.htm

InfoPool, Innovation Climate Questionnaire, 2006, http://infopoll.net/live/surveys/s27054.htm
Aaltio, Menzel, Ulijn, "On the way to creativity: engineers as intrapreneurs in organizations," Eindhoven Centre for Innovation Studies, The Netherlands Working Paper 06.06, Department of Technology Management, Technische Universiteit Eindhoven, The Netherlands, March 2006, http://72.14.253.104/search?q=cache:olL4N9BmOkYJ:fp.tm.tue.nl/ecis/Working%2520Papers/Eciswp145.pdf+intrapreneurial+success&hl=en&gl=us&ct=clnk&cd=21


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