Corporate Innovation/Opinion/

Why most intrapreneurship programmes fail

Less than 1% of the ideas that come out of these programmes are useful. Here are 11 tips for increasing the success rate.

By Alberto Onetti

Intrapreneurship is a hot topic today. Most of the corporates we talk to are planning to launch an intrapreneurship programmes, but also many companies that already have one in place are about to restructure it.

The reality is that most intrapreneurship programmes have failed to produce results.

Why is that?

The reality is that most intrapreneurship programmes have failed to produce results. They have neither spread a culture of innovation and entrepreneurship inside the company nor originated a flow of quality ideas.

In other words, the promise of employee-driven innovation hasn’t materialised (yet).

There is a common denominator in “broken” intrapreneurship programmes. Too many expectations supported by overly enthusiastic (internal and external) communication. The downside is double: on the one hand, top management and business units find themselves facing poor quality ideas generated through the programme. On the other, employees get frustrated as they see that ideas that get awards from the intrapreneurship programme are not actually implemented by the company thereafter.

How could companies do this better?

Don’t throw the baby out with the bathwater. Intrapreneurship, if properly implemented, is a key driver of corporate change, particularly today when being entrepreneurial is no longer an optional ‘nice to have’.

The good news here is that a few programmes have been able to produce results. Based on our experience, some benchmarks are InGenius at Nestlè, Ingenia Business at Enagás, Innovation Trophies (recently redesigned) at Engie, Launchpad at Vodafone (for each of them you can find the link to our interviews with the people behind each programme, Mind the Chat style).

We can take certain learnings from these. Here are 10 good practices (I don’t call them best practices because I have learned that there is no silver bullet in open innovation):

1. Setting expectations properly

The main goal of an intrapreneurship programme is cultural change. Producing quality ideas is not the immediate goal, so do not stress it too much in the communication.

2. Participation, but not at any cost

We want inclusive programmes ideally able to reach all employees. But this shouldn’t come at the cost of being open to any kind of idea.

3. Avoid one-man bands

Entrepreneurship is a team effort. Good programmes try to stimulate the creation of teams composed of employees of different business lines and countries. Spoiler: it’s easier said than done.

4. Be open to external ideas

External people and startups applying to an intrapreneurship programme? Yep, some companies (e.g. Engie and Enagas) have done it and it seems to work. Extra benefits: you might increase the learning experience by creating mixed teams (internal and external) and turning the intrapreneurship programme into a one-stop shop for all early-stage ideas. Caution: do not do it in the first edition of your programme.

5. Be focused

Programmes work best when they are challenge-based and the challenges are aligned with the overall company’s strategy and “owned” by the business lines.

6. Stage and gate

The best programmes are structured around multiple iteration cycles. This means two to three go or no go gates with 80% of projects being filtered out at the first selection and another 15+% in the subsequent evaluations. This allows you to both manage a wide deal flow and focus on a limited number of projects.

7. Feedback is key

Your people will take the time to submit a project or idea. This comes with expectations. Our data show that 98% of these ideas will be rejected.

To avoid frustration and maximise the learning – which is your primary goal (see point 1) — you need to dedicate quality one to one time to each of them, properly explaining the reasons they have not been accepted and how they might be improved.

8. Don’t create zombies

Recognise the most interesting projects but do not commit to executing ideas that do not have the potential to be impactful.

If not, you are adding 5 to 25 new projects (this is the average number of ideas that are given awards annually in intrapreneurship programmes) to your innovation portfolio that are going nowhere and are ‘politically’ complicated to kill.

Note: for a large company an impactful project is one that has the potential to increase revenues or save costs by hundreds of millions of euros.

10. Make it happen.

If something valuable comes out of the programme, you need to allocate the proper resources to implement it. That means capital (budget + investments), people (internal headcount + external resources) and, most importantly, top-level buy-in.

You may need to set-up a venture builder, a dedicated unit for launching internal ventures. And you need to involve in this new venture the originators of the idea, providing them with the opportunity (time-off, leave of absence) and economic incentives (real) to work on it.

11. Intrapreneurship is more than the platform or tool

There are many great intrapreneurship platforms (including Pollen8, Idea Drop, HYPE, Wazoku, Innovation Cloud). But they are just enablers, tools.

The intrapreneurship programme is more than that. By the way — do not build intrapreneurship tools in-house. Companies who have done that say that they wouldn’t do it again.

Final question. Is it worth it?

If we look at the data and ask about the ratio of ideas coming out of intrapreneurship programmes that have turned into impactful innovative products or services, the (honest) answer is: “less than 1%, in the best case”.

But it doesn’t matter. What really matters is the journey and the KPI is the cultural change.
If you manage to embrace change, innovation will follow.

The opposite applies. As a CIO told me in our weekly open innovation room on Clubhouse: “Be sure nothing is gonna happen if innovation is played by a ‘dirty dozen’ while the other thousands just wait and see.”

Alberto Onetti is chairman of Mind the Bridge Foundation.

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Christopher Weber-Fürst
Christopher Weber-Fürst

Great. My experience too. It’s all about finding the right persons. Setting the objectives. Make it a collective process. We know this. So how come so many initiatives fail? Not only innovation projects.