Managing intrapreneurship in the recession: Understanding how organisational conditions affect intrapreneurial efforts

Julie Hovald Nørgaard

Student thesis: Master thesis

Abstract

Globalisation forces companies to compete in a faster and more innovative manner. On top of this, the present recession increases the uncertainty of what the future will bring and how to create competitive advantages. Mature and large companies often find it difficult to act entrepreneurial, but in order to innovate faster, it is claimed that companies should encourage their employees to be entrepreneurial and innovative in order to survive the financial crisis. Intrapreneurship is focusing on the individual and autonomous initiative from employees, and it is driven by the individual employees’ risk willingness to take calculated risks to earn a profit on their innovative initiatives. This thesis has established a theoretical framework from the entrepreneurship, intrapreneurship and innovation fields, in order to answer the research question: How are the organisational conditions for intrapreneurship influencing, good or bad, the building of an intraprenerial company in today’s recession? The purpose of this thesis is to understand how it would be to work with intrapreneurship in the recession and the results may be of use to companies that are about to commence on intrapreneurial activities or to those that are encountering difficulties. It is investigated through an interpretation of academic and practical surveys that discuss innovation and intrapreneurship in the years after the financial crisis was a reality. A variety of different conditions are considered important theoretically, and by an inductive research method, the themes of: topmanagement support, strategic orientation and risk-taking, were identified empirically as important organisational conditions for intrapreneurship. It was found that top-management need to encourage intrapreneurial activities through failure acceptance. However, the majority of companies do not support innovation, are low on failure acceptance and do not reward entrepreneurial behaviour. Moreover, the recession has created more uncertainty in the return on investment of innovative initiatives, and less than half of the respondents are engaged in radical innovations. Having a strategic priority of innovation results in greater return on investment of innovative activities and the majority has innovation as an integrated element in their corporate strategy. However, the innovative skills of both managers and employees are problematic, and thus training and feedback becomes important management tasks. Those companies with an entrepreneurial orientation are more inclined to create radical innovation in a proactive and risk-taking manner. It is concluded that the distinction between a traditional management approach and an entrepreneurial management approach is rooted in how they approach risk-taking and failure acceptance. In the light of the recession, these themes should be central parts of a further research of intrapreneurship.

EducationsMSocSc in Organisational Innovation and Entrepreneurship , (Graduate Programme) Final Thesis
LanguageEnglish
Publication date2012
Number of pages87