Establishing an intrapreneurial orientation as strategy : a framework for implementation

M.Comm.Today's managers, faced with rapidly changing and fast-paced competitive environments, are challenged to manage "discontinuities created by an interdependent global economy, heightened volatility, hypercompetition, demographic changes, knowledge-based competition, and demassification of some sectors accompanied by enormous growth in others" (Daft & Lewin, 1993:i). Such environmental conditions place intense demands on organisations to interpret opportunities and threats actively when making key strategic decisions. To cope with such challenges, existing larger firms are increasingly turning to corporate entrepreneurship as a means of growth and strategic renewal (Guth & Ginsberg, 1990). Entrepreneurship involves a process of value creation in which an individual or team brings together a unique package of resources to exploit an opportunity. The key steps involved are: identifying opportunities, developing business concepts, determining needed resources, acquiring resources, and managing and harvesting the venture (Jones, Morris & Rockmore, 1995:86). Corporate entrepreneurship (also termed intrapreneurship) involves extending the firm's domain of competence and corresponding opportunity set through new resource combinations that are internally generated (Burgelman, 1984).- Terms such as 'reinventing the corporation', 'the empowered organisation' and 'organisational renewal' are used to describe change efforts where entrepreneurship is a central ingredient. Research has shown that organisations that adopt an entrepreneurial posture in order to cope with the uncertain environment are characterised along dimensions such as unpredictability, dynamism and heterogeneity. These organisations enjoy superior performance (Covin & Slevin, 1988; Zahra & Covin, 1995). The domain of entrepreneurship is no longer restricted in a conceptual sense to the process of creating an independent new venture (Wortman, 1987; Low & MacMillan, 1988). Lumpkin and Dess (1996:136) describe the essential act of entrepreneurship more appropriately as 'new entry'. New entry is the act of launching a new venture, either by a start-up firm, through an existing firm, or via 'internal corporate venturing' (Burgelman, 1983). With this in mind, they distinguish between entrepreneurship and entrepreneurial orientation. Entrepreneurship explains what entrepreneurship consists of, and entrepreneurial orientation describes how new entry is undertaken. Entrepreneurial orientation can therefore be defined as the processes, practices and decision-making activities that lead to new entry (Lumpkin & Dess, 1996:136). However, the entrepreneurial orientation (also referred to as entrepreneurial posture) is not limited to the creation of new organisations, but exists in all actions that distinguish entrepreneurial behaviour from other types of business activity that might be undertaken to capitalise on an opportunity (Lumpkin & Dess, 1996:153). These actions also pervade the organisation at all levels (Covin & Slevin, 1991:7)