You're a Successful Entrepreneur, But Can You Succeed at Intrapreneurship?
I have worked with many entrepreneurs and my fair share of intrapreneurs and there is a significant difference in the environment the two must face. The intrapreneur must accomplish what an entrepreneur does but within the real and virtual walls of an existing corporation. A corporation can bring some added benefits such as access to resources, available IP, technology, and funding, but it also brings many constraints that an independent entrepreneur simply does not have to deal with. Here are just 6 of several covered in the book, Winning at Intrapreneurship: 12 Labors to Overcome Corporate Culture and Achieve Startup Success.
Limited freedom of movement
The intrapreneur reports to someone, which means the buck stops with someone else. An intrapreneur is rarely given the same freedom of movement experienced by his entrepreneur counterparts. The fact that an intrapreneur works within an existing corporation means that he/she must comply with existing corporate governance, rules of business, systems and processes that an established corporation puts in place to control business activities and how they are conducted. This limits the options available to turn an idea into a winning business.
More aggressive time expectations
Independent entrepreneurs can work on their innovations and new business at their own pace. Yes, they may have to borrow, max out credit cards, and eat mac and cheese for months, but they control the pace. They can survive working from their garage as long as required to validate their business idea and minimal viable product with early adopters. When a corporation decides to launch a new business, it wants to see results fast, which can lead to overly aggressive and unrealistic time expectations.
Ill-suited corporate performance metrics
In my experience, one of the major differences between an independent startup and one launched from within an existing company is the fact that the former will be able to focus on metrics and KPIs that matter to a startup, while the latter will often be pressured to demonstrate results based on business metrics that are designed for already existing companies but ill-suited for any startup. This can lead to precious time and effort being focused on the wrong issues.
Limited funding options
One of the intrapreneurs’ seemingly most significant advantage is the access to funding. This can often play against them because in the early days of any startup, more money does not necessarily lead to faster progress. There is certainly some gains to be had from ready access to cash, but in the infancy phase of a new business, time must be spent by a small team working with early adopters to validate how the idea can meet an unmet need, how money can be made meeting that need, and if the business model can be scaled sufficiently to become relevant to the larger corporation.
Too many approval levels
Unfortunately, intrapreneurs are too often given limited decision-making authority. This can ultimately limit their effectiveness and the speed of decision-making. When key business decisions must first be approved by a corporate CFO, COO, CEO, CMO, CHRO, or CIO speed is sacrificed and so is the quality of the decision where often compromises are reached instead of the best decision for the startup’s needs.
Resistance to change
When a corporation launches a new business or line of business with the idea that it should leverage as much as it can from the parent company, if must often deal with its own departments wanting to impose their way of doing things. This is often an outcome of their focus on operational efficiency or of a desire to retain control. The bottom line is that any system or process that is imposed on a corporate startup that does not meet that startup’s needs 100% is unsuitable. Furthermore, when resistance to change results in settling for compromises, the startup suffers every time.
