Entrepreneurship Chapter 2 Corporate Entrepreneurship

Interest in Corporate Entrepreneurship

• Growing social interest in entrepreneurship within organizations
• Entrepreneurial spirit is critical for innovation and growth
• Hypercompetition forces focus on product, productivity, and costs
• Developing corporate entrepreneurship helps overcome resistance to flexibility, growth, and diversification
• Four key elements of entrepreneurial endeavors:
  • New business venturing
  • Organizational innovativeness
  • Self-renewal
  • Proactiveness

Strategic Orientation and Commitment to Opportunity

• Entrepreneurship and strategy have important implications for firm performance
• Strategic orientation involves factors input into formulating firm strategy
• Entrepreneurial management is driven by opportunity, not resources
• Firms with entrepreneurial orientation rapidly pursue opportunities, seizing windows of opportunity
• Traditionally managed firms emphasize collecting and analyzing information, sometimes missing opportunities

Commitment of Resources and Control

• Entrepreneurially managed firms minimize resources needed to pursue opportunities
• Traditionally managed firms commit resources on a large scale
• Entrepreneurially managed firms are less concerned about ownership of resources than access to others' resources
• Traditionally managed firms focus on ownership and accumulation of resources

Management Structure and Reward

• Entrepreneurially managed firms have an organic management structure with few layers and many communication channels
• Traditionally managed firms have a structure suited for internal efficiencies and controlled resources
• Entrepreneurially managed firms focus on pursuing opportunities representing new value for the firm
• Traditionally managed firms reward based on responsibilities and resource control

Growth Orientation and Culture

• Firms with entrepreneurial orientation have a strong desire to expand rapidly
• Traditionally managed firms prefer slow and steady growth
• Culture distinguishes entrepreneurially and traditionally managed firms
• Entrepreneurial orientation encourages generation of ideas, experimentation, and creative output

Characteristics of an Entrepreneurial Environment

• Organization operates on frontiers of technology
• New ideas are encouraged
• Volunteer program and trial and error are encouraged
• Appropriate reward system and failures are allowed
• Sponsors and champions are available
• Resources are available and accessible
• Support of top management

Leadership Characteristics of Corporate Entrepreneurs

• Corporate entrepreneurs understand the environment and encourage open discussion
• They must be visionary leaders, dreaming great dreams
• They must be flexible and create management options
• They encourage teamwork using a multi-disciplined approach
• They must be persistent to make new ventures successful

Establishing Corporate Entrepreneurship

• Secure top management commitment
• Identify areas of interest and available resources
• Use technology to make the company more flexible
• Train interested managers and employees
• Develop ways to get closer to customers
• Tie rewards to performance of the entrepreneurial unit
• Allow successful units to expand and unsuccessful ones to be eliminated

Problems and Successful Efforts

• New ventures started within corporations may perform worse than those started independently
• Reasons include lack of long-term commitment, freedom to make decisions, and constrained environment
• Examples of successful corporate entrepreneurship include 3M's independent projects, such as Post-It notes

Learning From Failure

• Initiatives may fail to achieve objectives and are terminated
• This represents an opportunity to learn and avoid the same mistakes in the future
• The dual process model of coping with negative emotions involves oscillating between loss orientation and restoration orientation
• Loss orientation focuses on the loss event to create an account of the failure
• Restoration orientation uses distraction to focus energy on other problems

Practical Implications of the Dual Process

• Recognizing the normalcy of feelings of loss can reduce shame and embarrassment
• Realizing the psychological and physiological outcomes of loss are "symptoms" can reduce secondary sources of stress
• The recovery and learning process can be enhanced by using the dual process model of copying with negative emotions.

This quiz assesses understanding of corporate entrepreneurship, focusing on the entrepreneurial perspective in chapter 2. It covers topics related to entrepreneurial ventures and corporate innovation.