פתח תפריט נגישות

Companies nowadays invest considerable resources in the invention and development of cutting-edge products and services. Research and development divisions throughout the world unearth the next patent that will achieve profits for the company and grant it an advantage over its competitors. Third parties, such as advertising and marketing companies and strategic consultants, rake in great deals for conceiving and preparing creative materials, building marketing plans and conducting strategic planning, all of which, at best, are only partially implemented and, in worst-case scenarios, collect dust in the CEO's desk-drawer. Yet, in some instances, the best ideas are not actually found there, but are developing in the sharp-witted minds of ordinary employees who know the organization better than anyone. Already, in the 1980s, the concept of intrapreneurship was coined to describe this trend. So, what is intrapreneurship and how can it be encouraged?


The answer for the next patent that will grant the company an advantage

Steve Jobs once said that innovation is not a direct result of the amount of money you invest but, rather, in the people working for you and the manner in which you lead them. In the past, when the conception was that serious research and development were something that only very wealthy companies or governments could afford, Steve Jobs' statement sounded revolutionary. Today, after countless projects, products and services that found their humble beginnings in parents' dusty warehouses – innovational in itself and of which Jobs was an envoy – his statement sounds obvious. Today, more and more organizations understand that the source of entrepreneurship and innovation is indeed found in the people themselves. The budget invested therein can, of course, accelerate and upgrade the development of those ideas, but it does not constitute a guarantee of their actual existence. Therefore, it is not surprising that intra-organizational entrepreneurship or in its catchier name in English – Intrapreneurship – is now an important course in the business strategy of countless companies.

An excellent example of the actual expression of intrapreneurship can be found in the conception of the most prolifically sold gaming console ever – the PlayStation.  Ken Kutaragi, a 25-year-old engineer, joined Sony's sound division in 1975. The years passed, he had a baby daughter and, at some stage, he bought her a Nintendo gaming console. Because of his training and experience in the field of electronics, Ken concluded that a digital chip, intended solely for producing sound, would significantly improve the quality of the Nintendo console.  So, in parallel to his work at Sony, he became an external advisor to the rival company. The executives at Sony were none too pleased with their engineer's side project and even threatened to fire him but, fortunately for Ken (and for them also) the CEO of the company at the time, Norio Ohga, recognized the values of creativity, entrepreneurship and innovation that were not immediately apparent and, instead of firing Ken, he encouraged him to bring them to the fore in his work at Sony. But the story doesn't end here. As part of his Nintendo counselling, Ken developed a new gaming console based on disks.  Ultimately, Nintendo decided not to invest in the project, which caused Ken to turn the idea over to his managers at Sony. After countless attempts at persuasion, the talented engineer succeeded in convincing the directors to produce the product that he'd developed and enter the market of game consoles, despite their considerable skepticism and perception that it would be a non-profitable toy for Sony. The end of the story is known to one and all – Sony took the game consoles market by storm!  And PlayStation, on the four models that have gone to market since 1994, has become the largest selling games console ever sold.

But intrapreneurship does not necessarily have to manifest itself as a product innovation, but can also be a process, a conception or a service.  Another example of intrapreneurship that has become a success is the story of Disney's FastPass. Greg Hale was a curious young engineer when he was interviewed for a position in the Disney Engineering department over three decades ago. He was eager to see how things worked behind the scenes in one of the world's most famous amusement parks. He was accepted for work and appointed supervisor in the engineering and control department. In 1999, Greg recognized that the great success of Disney World was also its 'Achilles Heel'. As more and more visitors flowed in, the lines for the facilities grew longer and longer. The most common complaint by visitors was the waiting time spent standing in queues, instead of enjoying everything else that the park had to offer. In order to solve this problem, Greg had an idea – what if the visitors could keep their place in the queue without needing to be there physically?  That way, they could go for a meal, buy souvenirs, or watch a show while their place in the queue for their chosen attraction, would be saved. And so, the FastPass idea was born.  By using the system that Greg developed, visitors could scan their cards using machines located by each facility and receive an extra ticket that gave them an hour-window in which to enter the facility, allowing them to return to it later and to enjoy it with negligible waiting-time. Needless to say, the system became a dizzying success from the moment of its implementation in the park, in July 1999, and was later introduced into all Disney parks around the world. In 2014, Disney also launched the FastPass+.  A more advanced, paperless system, allowing guests to book tickets to the various facilities weeks before their actual arrival in the parks.

It is also important to note that intrapreneurship need not come about as a result of such technological developments.  For example, Dave Myers, an employee of the W.L. Gore Company, an American manufacturer of plastic products, recognized that one of the company's products from which cables were made for electrical appliances, could also be used to manufacture guitar strings. The new strings were discovered as not only being more convenient to use, but were also able to maintain their tone longer than regular guitar strings. After the company launched them under the Elixir brand, they became the best-selling guitar strings in the United States. This idea was born within the framework of the company's policy, which allows its employees to work on personal projects and to develop new ideas, for 10% of their daily work time.  Something that is practiced by several organizations nowadays.

There are, of course, countless other examples of intrapreneurship that have led to the development of products and services which have propelled companies forward. The bottom line is that good ideas are not dependent on money or advanced technology, but are found in the minds of people like Ken Kutaragi, Greg Hale and Dave Myers. A company that does not want to stagnate, needs to identify these types of employees and encourage them to develop their ideas.  But how is this done? There is no precise formula, but there are a number of basic things that can cause innovation and intrapreneurship to flourish:

Support for an external entrepreneurial environment – businesses that are more involved in the system around them tend to be more innovative. A strong innovative culture in a particular environment leads to intrapreneurship in companies that are part of the same environment. Organizations need to take part in innovative events and visit new and emerging businesses, to use external entrepreneurs and consultants, and even to actively inaugurate and advise entrepreneurs at the beginning of their journey.

Building an internal innovative environment – setting up thinking groups involving employees from different departments, giving priority to entrepreneurship in the company's business strategy, delegating authority of innovative powers to specific employees, providing time to work on personal projects at the expense of work-time, etc. Tools that encourage entrepreneurial thinking and increase awareness of the importance of innovation in the company.

Providing rewards to intra-organizational entrepreneurs – whether a material reward, such as a salary increase or bonus, or another type of reward, such as professional training or providing the possibility of participation in a particular conference. Rewards encourage creative workers to continue to bring their creativity to fruition at work.

Now examine yourselves…  Does the company in which you work encourage intra-organizational innovation and entrepreneurship? If so – excellent!  If not – then you must try to be the ones who drive entrepreneurial thinking in the company!  At the end of the day, we're talking about profit for both sides.  Both for the employee who brings his creativity to fruition, and for the company that stands to benefit from it in the future.

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