Aligning corporate entrepreneurship with human resource practices: the case of the banking industry in Cyprus

Recent years have found well-established firms attempting to capitalise on the benefits of corporate entrepreneurship and the entrepreneurial spirit. In fact, a growing body of evidence suggests that a corporate entrepreneurial orientation is critical for organisational survival and growth in the contemporary business environment. When applied to existing firms, entrepreneurship takes on unique characteristics, and becomes subject to a number of obstacles and constraints not found in most independent start-ups. The magnitude of these constraints has led many to conclude that unique approaches to organisational design and management are necessary if entrepreneurship is to be facilitated on an ongoing basis. Of all the managerial decision making areas that can affect corporate entrepreneurship, human resources management (HRM) would seem the most vital. Indeed, the HRM field appears to be experiencing a fundamental transformation from a micro-oriented, bureaucracy-based, tool-driven discipline to one centred around the congruence of the various aspects of the HRM system with business strategies. This research reviews human resource practices and their impact on corporate entrepreneurship in the banking industry of Cyprus. A case-based methodology is adopted to investigate the research problem and objectives. The starting point of this research was an extensive review of the corporate entrepreneurship and human resource management literature. A case study pilot was conducted to investigate the appropriateness of the questions in the interview guide. The case studies were five well-established Cyprus banks of varying sizes. Data was collected through interviews with the HR managers of each bank and an additional two key managers from each bank. This research identifies the effectiveness of HRM practices in encouraging corporate entrepreneurship in Cyprus banks, as well as the inhibitors and motivators of corporate entrepreneurship. The research recognised that similar factors, as identified in the literature, such as organisational structure, rewards, management, training, autonomy, resource availability, act as inhibitors and motivators to corporate entrepreneurship. The only factor that was not in alignment with the literature research was job security, which was identified as an inhibitor to corporate entrepreneurial behaviour rather than a motivator. This research provides Cypriot banks with a framework to evaluate their organisational efforts for encouraging corporate entrepreneurship. The findings allow these organisations to review the current practices and act as a means to aid in the learning and in enhancing corporate entrepreneurial behaviour