By Jim Dewald
Jim Dewald discusses the processes towards corporate entrepreneurship which are needed for organisations to achieve longevity and success in the evolving market.
I find it fascinating that corporations are inherently capable and sufficiently resourced to succeed in entrepreneurial ventures – they have the money, the ideas, the brainpower, the leadership capabilities, the sales channels, the suppliers, the research facilities, the customers, the status, and so on. In short, existing corporations already have almost everything an individual entrepreneur seeks in the pursuit of success. So why isn’t there more corporate entrepreneurship? It is because corporate entrepreneurs face institutional barriers, which include rigid strategic plans, risk-adverse decision-making processes, rules that restrict behaviours, and a low tolerance for failure both within the firm and within society. Organisations have the capabilities and resources, but they lack the processes necessary for corporate entrepreneurship. This can be fixed.
The stakes are high, for there is very low tolerance in the marketplace for firms that experiment with new ideas that fail. The individual entrepreneur is expected to fail, whereas the corporation is expected to be stable and to grow steadily to the next level, and the next level, and so on.
To be fair, leaders do grasp that some amount of change is inevitable; they recognise that the competitive environment changes as market needs change, technologies change, and cultural and societal values change. But I emphasise: sticking to a perceived sustained competitive resource-based advantage can lead to only one conclusion – failure, brought about by the inability to adapt effectively. To achieve longevity and adapt to changing environments, business firms need to embrace entrepreneurial thinking, an entrepreneurial culture, and strategic entrepreneurship.