It feels like every corporate tries hard to make intrapreneurship work, but despite hundreds of programmes popping up in recent years, most are struggling to produce outcomes.
Working with top global companies’ intrapreneurship departments within the last couple of years I have seen the reasons for failure firsthand. Having founded two startups myself, I know that even with the latest tools and great execution you need some luck to survive. Intrapreneurs face the same pressures as entrepreneurs. The customer doesn’t care that the intrapreneur had to face hierarchical and political hurdles. The truth is, most intrapreneurship efforts are a dead end from the beginning.
These are the most common reasons:
1. Corporate environments are not a great starting ground
Corporate environments are not the ideal place for an idea to hatch and grow. Corporations have advantages like reputation, an existing user base and access to cash, but the downsides for intrapreneurs easily outweigh the upsides in many cases.
Intrapreneurship programs often referred to as “speed boats” next to the big corporate tanker, but most of the time they act more like paddle boats. You face a lot of resistance and have a hard time moving forward at all.
Solution: Try to keep operations of the initiative as separated as possible from the daily business, but keep close connections to the main stakeholders and enablers. Keep them involved by letting them have regular input into the project.
2. Intrapreneurs have no upside, hence no motivation
Working insane hours for an idea, or a greater belief involves a lot of (intrinsic) motivation, passion, and maybe, just maybe, the hope of making good money after some tough years. Without at least one of those potential upsides, no one in the right mind would put in countless hours and nerves over a longer period of time.
Entrepreneurs often have all this covered, but intrapreneurs rarely have any huge upside when participating in an intrapreneurship program. In the best case they can break out of their corporate daily business for a while and get to know some fun methods. That’s all! If anything, it just means extra work.
Solution: Implement certain benefits for intrapreneurs. This can mean granting shares in a potential spin-off, more freedom during and after executing the project, or a promotion. Find the right incentive for every individual.
3. Employees get forced to be intrapreneurs
There is a myth that the intrapreneur is this outstanding employee mastering all tasks and countering all resilience, networking like a pro to make the impossible happen within an organisation. This really is just a myth. In reality, a lot of times, people get forced or talked into intrapreneurship activities — not a good way to ensure commitment and success.
Solution: Create a pool of interested employees by continuously offering educational formats and building relationships within your company through events and meetups. Create a shortlist of high potentials with outstanding motivation and get back to them as soon as you’ve got the right program or topic.
4. They don’t get the time they need
Implementing a new product/service at a big company is in many ways like starting your own startup. But corporations often treat these initiatives like a side project on top of the employees’ regular tasks. Let me ask you: Do you think someone could be successful with their business when working on it for one day every second week, or with 20% of the overall working time? Not really, right?
Solution: Make one project a priority instead of having 20 initiatives running at the same time. By communicating the innovation efforts early on and making sure to create benefits for the departments themselves, you can get more resources and the best minds on board.
5. Not everyone has the potential
You need a special mindset to be an entrepreneur. You have the be self-driven, curious and well-connected. Not everyone has these traits and that is totally fine.
Solution: It is important to exclusively look for people with the right mindset and skillset, who have the right knowledge in the specific area that you are trying to innovate. If you start with the “wrong” people, you might as well just not start at all.
6. Cash is not that easy to get
Did you ever try to build a digital product or even a first MVP with no one in the team able to code and a very limited budget? Seems impossible right? Well, it is! Very often, the budget to execute certain projects is just not a realistic one. Innovation teams are not the most cash-rich in the company, as they struggle with tangible returns and often don’t have enough political pull.
Solution: Make sure to communicate an approximate budget upfront. This should include not only the first step but the whole journey from start to implementation, displayed in steps. Also, by involving managers who can free up budget and trying to create benefit for them, you will have an easier time getting money.
7. No one to hand over to
At one point, an idea will evolve into a product and that product either needs to be integrated into the main corporate structure or spun out. Many times, the people working on the project have just a limited time before they have to go back to their regular roles, so they need someone to take over. If this doesn’t happen, the project is doomed.
Solution: Make sure to always have an “Idea Owner” who stays with the project. In the best case scenario, this person brings in the idea and integrates it later on.
8. No main leader
Every startup needs a visionary to drive, steer, and motivate the team. So does every intrapreneurship team. If the team is lacking direction and drive, they can easily go nowhere or just don’t move at all. Especially in a corporate environment, the teams often tend to go back to bureaucratic and conceptional approaches instead of putting the focus on doing stuff.
Solution: Make sure to have a strong Innovation Manager on board that is leading the initiatives. This person has to infect the team with enthusiasm, drive all efforts, and work even harder than anyone else on the team to make it work.
The bottom line is that innovation departments don’t have enough power to get the resources they need. The expectations of top-level management are also unrealistic. Not only do they expect entrepreneurs to solve problems the organisation hasn’t managed to solve before, they want them to do it cheaper and faster.
Furthermore, not everyone is born to be an intrapreneur and those people are really hard to find. As mentioned, distinguishing factors are the unique mindset, drive, and willingness to change the status quo, just to name a few.
Given all of this, does it still make sense to run an intrapreneurship programme?
My answer is still a clear yes. Your programme may not build awesome new products in the short term, but it will help slowly change people’s and therefore the companies’ overall mindset towards a more open and innovative culture. Companies just need to shift the way they see intrapreneurship programmes. They are a tool to shift mindsets towards a more future-oriented approach. And the only way to do that within a corporate environment is the hard way.
Alex Schuh is a senior innovation consultant at Pioneers and has run several intrapreneurship programmes for big European companies.