Assessing the impact of Board of Directors on corporate entrepreneurship of large public companies

While many researchers have proposed strategies for corporate entrepreneurship (CE) success, there is a lack of published research as to why CE succeeds or fails at large public companies. This paper explores one aspect of this issue, namely how a company's Board of Director's impacts its CE. Many academics have advocated CE as the driver of corporate innovation and growth including Covin and Slevin (1991), Zahra (1993), Lumpkin and Dess, 1996, and Birkinshaw (2003). The business community increasingly accepts the importance of CE. For example, Stewart (2006) reported the opinion of Jeff Immelt, the chairman and CEO of General Electric, that whereas the focus of his predecessor, Jack Welch, was acquisitions and improvements in productivity, in the future the market would reward organic growth driven by innovation. At the same time, the literature also identifies a number of large companies that have been unsuccessful in their CE efforts. For example, O'Reilly and Tushman (2004) identify Kodak and Boeing as examples of companies that have failed in their attempts to adapt to market changes. The literature appears to be silent as to why CE experiments are successful at some firms and unsuccessful at others. While many authors, including Pinchot (1985) and Hamel (2002), have identified conditions required for CE to be successful, their prescriptions appear to be insufficient to ensure a high probability of success. Research is needed to identify the factors that determine the success or failure of CE initiatives. The authors of this paper explore one potential factor, that is: 'How do the actions of a firm's Board of Directors impact its corporate entrepreneurship?