Bureaucratic organizations

There are many factors to renewal, these are redefining of business models, restructuring and the introduction of new systems for innovation. According to Kuratko et al. (1990) the need to pursue intraprenuership has arisen from a variety of pressing problems including: (1) required changes, innovations, and improvements in the marketplace to avoid stagnation and decline (Miller and Friesen, 1982); (2) perceived weakness in the traditional methods of corporate management; and (3) the turnover of innovative-minded employees who are unhappy with bureaucratic organizations.

The pursuit of intrapreneurship as an approach to counter these problems creates a newer and potentially more complex set of challenges which set on different levels. The identification of theses various levels in intraprenuership are in its core a broad arena to consider. Intrapreneurship activities can be internally or externally oriented (MacMillan et. al. , 1986; Veciana, 1996). Internal activities are categorized as development within the organization for internal markets and small independent units creating internal test-markets, services, technologies and creation methods.These activities may cover product, process, and administrative innovations at various levels of the firm1 (Zahra, 1991).

It is possible that intrapreneurship might express itself in various ways on levels of administration, investments etc. Intrapreneurship internally would be defined as the first step that consists of combining resources divided in an environment by individual entrepreneurs with their own mindsets to create a resource independently. External efforts involve namely mergers, joint ventures, corporate venture, whether the focus is on the internal or external factors intrapreneuership is formal as well as informal.

The informal parts of any intrapreneurship occur in competition with or without the go ahead of the organization. Such activities result in the blooming of creativity, ideas and finally in most cases result in recognition from the organization and becoming a basis for the continued innovative business. According to Zahra (1991:262) a comprehensive of intrapreneurship must incorporate both formal and informal aspects of corporate venturing, as follows: “intrapreneurship refers to formal and informal activities aimed at creating new business in established companies through product and process innovations and market developments”.These activities may take place at the corporate, division (business), functional, or project levels, with the unifying objective of improving a firm’s competitive position and financial performance (Morris et al. , 1988). From this we learn that intraprenuership is not restricted to a particular business dimension and or particular business stage for example the start up.

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In today’s aggressive market environment intrapreneuership is an essential tool for long term success of any organization whether small or big, new or old.In common business literature 3 modes by different scholars stand out, these being, firstly, creating new business ventures within an established organization (for example, Burgelman, 1983; Kuratko et al. , 1990; Guth & Ginsberg, 1990). Secondly, the omnipresent activity associated with transforming or renewing the existing business (Stopford & Fuller, 1994). Lastly, the organization changes the rules of competition in its industry in certain mannerisms suggested by Schumpeter.According to his (Schumpeter) terminology the pattern in which resources are deployed will transform the organization into something extensively different from “the same old same old to something new”. This transformation in turn will reflects’ the intraprenuerial performance of the organization.

Intrapreneuerhip within an organization through new business development is one of the ways to achieve a strategic edge over the market in terms of renewal.Strategic renewal encompasses the creation of new assets from new combinations of resources which in turn redeploy the business competitively enabling major changes in its marketing and distribution wings (Guth and Ginsberg, 1990). It is hard to explain the process since relatively very less is known about how intraprenuership/corporate entrepreneurship works within large conglomerates. Burgelman claims that intrapreneuership is a process by which firms are engaged in broadening their horizons through internal development. “A sort of growing out from within”.It may further illustrated with an example in the later stages of this essay. Such processes involving diversification would require new resource combination to extend the firms’ involvement in other areas not linked or a tad bit related to its’ current sphere of proficiency.

To add on with what Schumpeter may sum it up as diversification through in-house development is an analogue of the corporate process in intraprenuership. Intrapreneuership is the result of linking entrepreneurial activities of many participants to achieve a common goal.These activities provide the right diversity also. Since order in strategy can be achieved through planning and structuring then diversity in a strategy may be achieved through experimenting and selection. The mission of the management is to preserve an appropriate balance of these different processes. They will surely have many repercussions on the organizational arrangements and towards the development of strategic managerial skill sets. Miller and Friesen (1982) have created a distinction between the concepts of intrapreneurship and an entrepreneurial strategy.

Entrepreneurial strategy is defined as the regular and continuous effort to establish a competitive lead through innovation on the other hand intrapreneuership is the effort to do so but with an infrequent frequency, yet still to implement innovation. Intraprenuership is a social process (which when used in a business model) where in innovations are developed through a series of trial and error learning episodes (Van de Ven, 1986) These episodes in turn constitute to a complex group of transactions which involve a lot of people and amount of information.Burgelman (1983) has asserted that intraprenuership will represent an important foundation of the management if utilized wisely. Independent intrapreneuership should be initiated by managers and middle management. This sort of initiation by the management will provide the company with vital mixture (untapped potential) for the organizational renewal.

This will also have a butterfly effect of sorts when the upper management is influenced by the middle management due to afore said intrapreneurial actions.

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