Intrapreneurship & Managerial Models

Content

Existing organization are facing a growing imperative to renew themselves, to allow the emergence of new activities. This matters specially in an economy where IT drives faster emergence of waves of new businesses both tiny and large.

This course addresses the challenges and methodological issues of creating new ventures. It provides material for reflecting on those managerial practices and their logic of action, hence their paradigm of action.

It explores in particular the issues practitioners face when trying to build new ventures (i.e., significantly different new lines of business, services or products) in existing organizations, often labeled intrapreneurship.

It anchors on understanding the mental models and logic of actions underlying the various types of activities that managers/entrepreneurs engage in. Those paradigms are inherited from the shared practices in business environment, or in business training. They are often implicit, yet they matter as they may need to be adjusted by the practitioners depending on the objective and context, which can range from organizing a new business emergence vs. managing the growth and differentiation of existing business lines.

In most corporate environments, practitioners suffer the unconscious tension of two archetypal managerial paradigms: on the one hand, a scientific method centered on planning that underlies most of business education (Taylorian); on the other hand, the apparently unpredictable emergent nature of true entrepreneurship (Lean/Effectual). The course helps students identify their own representation, when each would be appropriate and why they may drift in the wrong direction in field situations.

Individual (e.g., leadership), organizational level (e.g., structure) and methods (e.g., tools) specific issues regarding intrapreneurship explored.

Objective 

This course fits as an advanced elective for students specializing in entrepreneurship, once they already master the basics of the entrepreneurial processes (basic “Entrepreneurship” course), as well as having experienced the entrepreneurial process in specialized teaching (e.g., “new business ventures” course).

For entrepreneurship-focused students, it revisits some of the modern entrepreneurial doctrines (e.g., lean) and explore the difficulties to implement them, with an extensive focus on corporate environments. It also trains against the danger to revert to traditional managerial paradigm (i.e., Taylorian), even though one was trained in truly entrepreneurial methods.

It will also be relevant to students at large, as long as they already master the core business education (i.e., OB, strategy, marketing, financial planning, etc.). For them, it will provide the basics of modern entrepreneurial frameworks (effectuation/lean) and will identify the contrast with the dominant optimization-driven paradigm underlying their generic business education.

For non-entrepreneurship students, taking the course opens for the possibility of becoming an intrapreneur with a future employer. It can also serve as a primer on entrepreneurship, hence prepare for possible career change towards entrepreneurship, at a later stage in their career.

Topics

This is an advanced course: it assumes students to have at least a good command of the traditional business paradigm. Business school education—whether implicitly or through explicitly entrepreneurship courses—provides most of the tools for classical venture creation processes, i.e., to generate ideas, to establish strategies, to build plans, to compute financial projections, to conduct market studies, etc.

·    The course therefore begins with a presentation of the alternative more modern paradigm relative to lean venturing, grounded scientifically in Effectuation (Sarasvathy 2005).

o   It emphasizes the difficulties to enact such paradigm, beyond just understanding them.

·    It then focuses on issues of fixed cost:

o   In various industries, fixed cost have been identified as the central issue leading to the emergence of lean paradigms (and labelled “agile”, or “lean”).

o   It identifies technological changes--in particular IT changes of the last decades--as factors enabling the reduction of fixed cost, therefore higher rate of emergence of new ventures, hence an increased need for intrapreneurship.

·    It focuses on a common concern of modern entrepreneurship, scale, which relates to an implicit aspiration of large firms. However, scale as an a priori objective may have deleterious effect on venture emergence, hence require caution and an ambidextrous approach (to both seek and fear scale).

·    It covers basics of network economies, in order to provide proper representations as well as tool to address opposite non-linear growth mecanisms of new ventures: virality (free growth) vs. club effect (depressed initial growth even for viable products).

·         Once all those methodological tools have been provided, the course can sequentially cover various substantive issues of intrapreneurship:

o   individual

o   organizational

o   models.

Outline (Course structure)

S1

Perspectives on New Venture Emergence

Preparing Group work

S2

Lean paradigm war: an history of fixed-cost obsessions vs. increasingly short cycles

Group Work – Decision on P1

S3

Scaling up: a Taylorian dream or a natural imperative?

Group work - Update

S4

A Primer on Network Economy Models

Group work – Decision on P2

S5

Perspectives on Corporate Entrepreneurship

S6

P1: Group Project: Analysis of the emergence of a real firm

S7

Intrapreneurship: Individual Issues (Dow)

Case: Internal Entrepreneurship at Dow Chemical (IMD145)

Group work – Update on P2

S8

Intrapreneurship: Organizational Issues (Bertelsmann)

Case: Bertelsmann (INSEAD400-019-1)

S9

Intrapreneurship: Advocacy Model (BP Office of CTO)

Case Study: BP Office of the CTO (KEL366)

S10

P2: Group Project: Analysis of an intrapreneurial project/method

A1: Report on one book / significant synthesis / protocol on intrapreneurship practice

The pedagogical approach

Method

The course is designed around lectures on managerial paradigms & intrapreneurship, on two practical group works and some case studies.

The group work and the cases will provide with real-life experiences and simulate situations where the participant is the central actor confronting a dilemma, faced with the task of providing a judgment call to important managerial questions.

As exploration of paradigm implies challenging one’s hidden assumptions, the course relies on dense class discussion to allow perceiving when the representations and instinctive reaction go in the wrong directions.

Preparation

Class discussions will require case preparation and it is absolutely essential that participants do it carefully. Being adequately prepared for class discussion is a key part of the course and participants will be evaluated on the thoughtfulness and insightfulness of your class participation.

Material

Some readings may be suggested for some sessions but usually provided as reference and not a pre-session preparation. All slides will be provided to students afterwards. 

Technology in the Classroom 

There is a growing concern that technology has become too powerful compared with the feeble will of human minds. Thereafter, it would be advisable to be actually shut down devices in many sequences of our lives, both personal, professional, whether it be in meetings, personal discussion, or even free time. 

If you feel this is backward-looking, please read the following article which will convince you that this concern arises among most veterans of Silicon Valley (hint: top SV executives send their students to “computer-free” schools!):

Richtel, M. (2013). Silicon Valley Says Step Away From the Device. The New York Times.

http://www.nytimes.com/2012/07/24/technology/silicon-valley-worries-about-addiction-to-devices.html   

This concern is particularly acute in a learning environment with high cognitive load and great temptation to mentally escape the classroom. Accordingly, this course will be device free. Computers will have to be closed, tablets, smartphones and telephones into the bags. Bring all material in paper version.

Projects & Exercises 

Participants will be divided into project groups. Two group projects and one individual assignment will be conducted. The spirit of those exercises is to learn substantively (about nature of entrepreneurship; about tools for intrapreneurship). They also aim to develop your methodological skill to keep on learning and sorting knowledge properly in the future.

Here is the architecture of those exercises:

• Project 1 (group): 

o Goal: to describe the factual emergence mechanisms of an entrepreneurial firm. 

o Method: focus on the historical facts, availability of information

o Report: historically

o Focus: the arc of early life of an organization

o Work load upstream choice/downstream execution: 30-70

• Project 2 (group)

o Goal: to describe one method of intrapreneurship

o Method: focus on originality and on validated knowledge

o Report: analyze the method

o Focus: very narrow 

o Work load upstream choice/downstream execution: 70-30

• Assignment (individual)

o Goal: report on a book about intrapreneurship that could be used by practitioners

o Method: find the best book you can; summarize and criticize

o Report: synthetic and critical

o Focus: very large, a book for practitioners should be extensive

o Work load upstream choice/downstream execution: 50-50

For those exercises, a large share of the work and the value added belongs in the upstream, i.e., the search of the subject/target, the proposal, the push back, the comments, etc. It depends on each exercice (as noted above), and obviously may require more upstream work for those late and/or unlucky in their choice of target.

Grading pattern

Organizational Performance depends mainly on the ability to interact with others, discuss, listen, convince, etc. The evaluation is thereafter mainly based on active, accurate and valuable participation in class, which can be multi-faceted.

Additional individual evaluation relies on the selection and the report on a book about entrepreneurship. 

Further evaluation is based on the two small group projects.

 Grade: individual participation (25%) + individual exercise (25%) + group exercise 1 (25%) + group exercise 2 (25%)

Bibliography

S1

Perspectives on New Venture Emergence

This presentation covers various perspectives on new venture creation, whether inside existing firms or as a start-up. These issues intersect with those of innovation as novelty is often assumed (new market, product, process, organization, etc.). We focus here on the organizational and managerial issues that can create the conditions for innovative process to occur.

·         Historical perspectives on venturing

·         Modern approaches to venturing: Lean Venture and Effectuation

Readings

·         Sarasvathy, S. D. (2001). What makes entrepreneurs entrepreneurial? S. f. E. Action.

·         Bhide. 1992. Bootstrap Finance: The Art of Start-ups, Harvard Business Review, Vol. 70.

Preparing Group work

During this first session, groups will be assembled to conduct the projects together.

S2

Lean paradigm war: an history of fixed-cost obsessions vs. increasingly short cycles

Lean is a modern doctrine on how to approach entrepreneurship through experimental iterations. It has deep roots in a deep debate triggered by the dominance of the Taylorian organization of work.

The key driver of the debate is the assumption (central in the Taylorian paradigm) of large fixed costs and the need to reach scale. The history of modern management is revisited to identify fixed cost as a key organizational driver, leading to the Lean counter movement initiated by the Japanese automotive industry.

The industrial Lean and the paradigmatic avoidance of fixed cost occurs in other contexts (e.g., Agile in the IT industry), ultimately leading to the emergence of Lean Startup (Ries).

Lean is increasingly important as technology and the nature of the entrepreneurial ecosystem evolve.

Readings

·         Ries, E. (2011). The lean startup. New York, Crown Business.

Group Work – Decision on P1

·   For the existing firm (p1): you should have a proposal. Report your choice in class, we might discuss/challenge it.

·   For the intrapreneurial tool/example (p2): you should have debated it. Report it in class, you’ll soon have to settle.

S3

Scaling up: a Taylorian dream or a natural imperative?

 Scaling up has become a mantra in Silicon Valley, hence a salient issue among entrepreneurs in-the-making. The issues of scale compounds in intrapreneurship contexts. In existing firms, the startup imperative to scale up is compounded, as the scale reached for the traditional business lines creates implicit expectation for any consider future ventures.

However, as scale relates to fixed cost and predictability, it can signal or trigger a Taylorian approach, hence a loss of agility and openness to emergent ventures that may not appear scalable at first.

This tension and various issues surrounding the eventual scale up of successful ventures are therefore discussed.

Readings

·         Consult the following website: https://mastersofscale.com/ (Reid Hoffman)

Group work - Update

·   For the existing firm project (p1), work should be in progress.

·   For the intrapreneurial tool/example (p2): you should now settle it.

S4

A Primer on Network Economy Models

·         New activities emerge out of non-linear dynamics : some take-off exponentially, some stay ground against all efforts and financing.

·         Managers and entrepreneurs need to recognize, distinguish and manage the different network effects : virality and club.

·         This realization is all the more warranted that the economy moves in ever faster cycles, with digital enabling ever stronger network effects.

·         This short module offers a primer on the basics of network economy : Club effects & Virality.

·         It allows address the dynamics of various models, whether in the new (Gmail vs. Facebook, etc.) and the old economy (Ford vs. AT&T).  

Group work – Decision on P2

·   For the existing firm (p1): in 2 sessions, you present!

·   For the intrapreneurial tool/example (p2): you should now be settled.

S5

Perspectives on Corporate Entrepreneurship

Presentation on various angles of analysis of the Corporate Entrepreneurship process.

Material

·         Kuratko, Morris, & Covin. 2011. Corporate innovation and entrepreneurship : entrepreneurial development within organizations, 3rd ed. ed.: xviii, 483 p. [Mason, Ohio]: South-Western/Cengage Learning. Table of Content + Chapter 1

·         Silberzahn, P., & Rousset, B. (2019). Stratégie modèle mental : cracker enfin le code des organisations pour les remettre en mouvement.

·         Cavarretta, F. (2019). If you think you “get intrapreneurship” … think again! E. Knowledge. http://knowledge.essec.edu/en/strategy/if-you-think-you-get-intrapreneurship-think-again.html

S6

P1: Group Project: Analysis of the emergence of a real firm

·         With your group, study an existing firm for which you can gather information. The goal is to gain an intimate understanding of the dynamic of real firms.

·         Ideally, you would have direct access to the one of the founders. However, gathering information through archival means (public reports, web, movies, etc.) will be acceptable.

·         There is no constraint on the firm age, as long as you address issues of venture emergence. So you are allowed to discuss L’Oreal, as long as you can defend an analysis of “how L’Oreal, the new venture, emerged?” When you start describing comprehensive details about the existing firm, you have probably already strayed too much into “classic management” (except if those details are sufficiently particular to explain how the startup emerged).

·         Try to identify the concepts emphasized in the course (people, bootstrapping, motivation, platform, etc.) but you can present a linear historical narrative.

Deliverables:

·         A group presentation to deliver in class

·         1  paper copy to bring in class

S7

Intrapreneurship: Individual Issues (Dow)

·         Strategic and organizational issues in the development of new technologies and new business areas for existing firms

Case: Internal Entrepreneurship at Dow Chemical (IMD145)

1.       What is the relevance of such small project in a large multi-billion dollar company?

2.       Is e-epoxy the right use of Telford's talent?

3.       Would we tolerate the tactics used by Telford?

4.       How does this case illustrate my (other) company reality? What do we do differently? How can we be more effective?

Readings

·         Kotter. 1990. What leaders really do, Harvard Business Review: 103-111.

 Group work – Update on P2

·   For intrapreneurial tool/example (p2): Report in 1 minute you advancement, in particular whether have talked to practitioners and what artifact are you gathering.

S8

Intrapreneurship: Organizational Issues (Bertelsmann)

·   Strategic and organizational issues in the development of new technologies and new business areas for existing firms

Case: Bertelsmann (INSEAD400-019-1)

·   What holds Bertelsmann together?

·   Is coordination truly a must for Bertelsmann?

·   What influence does the internet have on their business?

·   What are the main barriers to increased collaboration?

·   What should Bertelsmann do next?

Readings

·   Fry. 1988. Lessons From a Successful Intrapreneur, Journal of Business Strategy, Vol. 9: 20.

S9

Intrapreneurship: Advocacy Model (BP Office of CTO)

·         Explore how corporate innovation and entrepreneurship can be led in an advocacy model

Case Study: BP Office of the CTO (KEL366)

1. How has the CTO office performed so far?

2. Should the CTO office be expanded so that it can take on more projects in areas in which it may not have technical coverage or business unit knowledge?

3. Should the CTO office request a larger budget so that it can perform more detailed “due diligence” and experimentation, as opposed to having to abandon a concept if a business unit cannot be found that is willing or able to fund even an initial small-scale pilot project?

4. Considering the changes in the IT world since the dot-com crash of 2000, would the CTO office benefit from developing new capabilities for finding, evaluating, and transitioning technologies? Would you recommend any particular areas for a future Blue Chalk? Should the CTO office pursue technologies beyond digital and IT-related technologies?

Readings

·         Wolcott & Lippitz. 2007. The Four Models of Corporate Entrepreneurship, MIT Sloan Management Review, Vol. 49: 75.

S10

P2: Group Project: Analysis of an intrapreneurial project/method

·         With your group, study an existing intrapreneurial project or method/tool for which you can gather information. The goal is to gain an intimate understanding of the dynamics of intrapreneurship, especially since this approach is still being theorized.

·         Ideally, you would have direct access to the one of the actors that launched the project, or that uses the method. However, gathering information through archival means (public reports, web, movies, etc.) might be acceptable.

·         There is no a priori constraint on project/method, it will just have to be “interesting” to the audience. Ideally, it will fall into one of the few categories.

o   An interesting intrapreneurial project in an interesting firm, for which we have quality information (e.g., we’ll present project X in firm Y).

o   A particular tool that is very innovative that can be exemplified in a specific context (e.g., we’ll present the protocol of the intrapreneurship missions of the consultancy X in the country Y).

o   A particular tool that may not be so innovative, but for which a cross-context comparison and evaluation is performed (e.g., we’ll compare “corporate incubator” performance in 5 large UK firms.”)

·         Make sure you analyze the situation through the concepts emphasized in the course (people, bootstrapping, motivation, platform, etc.) rather than present a linear simple historical narrative.

Deliverables:

·         A group presentation to deliver in class

·         1  paper copy to bring in class

A1: Report on one book / significant synthesis / protocol on intrapreneurship practice

·         You will explore the literature and report on one substantive written piece about intrapreneurship. The goal is to find good synthetic source, to inform practice.

o   OK: book, reports, long synthetic article that have a framework to explain and drive intrapreneurship action

o   Not OK: simple research paper; simple article about intrapreneurship;

o   How to be sure?: before choosing a book, ask yourself the question

§  “Is it credible this is the kind of resource you’d recommend to a colleague at work that would like to practice intrapreneurship?”

·         You propose any document, as long as no one is already reporting on it. First come first serve.

·         Once it’s validated, read, summarize and make recommendation. Very short (max 300 w), including at least the following items

o   Your Recommendation: 1. Must 2. Interesting 3. Bof 4. Avoid

o   Summary: approach, material, examples, etc.

o   Highlights: what was outstanding in 3 bullet points max

o   Classify

§  How modern is it?

§  How comprehensive?

§  How practical?

·   If you have a copy you can share, upload it in the shared folder.

 Deliverables:

·         Propose a document, and get approval

·         One synthesis to include in the shared spreadsheet

·         Deadline: 1 week after last day of class