Exploring Entrepreneurship and Intrapreneurship
Two closely related yet distinct terms commonly used in the business realm are entrepreneurship and intrapreneurship. Both require similar skills, such as problem solving, creativity, communication, and teamwork, used in different settings. Let’s take a look at their differences and how they complement each other.
Defining Entrepreneurship:
Entrepreneurship can be defined as the dynamic process of establishing and managing a new business. An entrepreneur is someone who embraces the risks and rewards associated with initiating and overseeing a business. Renowned for their innovative thinking and willingness to undertake calculated risks, entrepreneurs possess a vision for a new business or product and are prepared to invest their own time, capital, and resources into transforming their vision into reality.
Defining Intrapreneurship:
Intrapreneurship, in contrast, pertains to the development of new business ideas, products, or services within the framework of an existing organization. Intrapreneurs are employees who have an entrepreneurial mindset and leverage their resources to innovate and take risks within the organizational structure. Often granted autonomy to pursue novel ideas and projects, intrapreneurs receive recognition and incentives for their achievements in conceptualizing and implementing groundbreaking initiatives.
What are some examples of intrapreneurship?
Several notable instances serve to exemplify the concept of intrapreneurship:
- Google’s “20% time” policy allows employees to choose projects of their interest and dedicate 20% of their working time to them. This freedom has led to the creation of highly successful products such as Gmail and Google Maps.
- The development of Apple’s iPod was led by an internal team of engineers and designers directed by Jon Rubinstein. They were granted the liberty to work on a product aimed at competing with existing MP3 players on the market.
- IBM’s Watson, an artificial intelligence system, was engineered by a dedicated team within the company, headed by David Ferrucci. Empowered to tackle the challenge of creating an AI system capable of competing on the popular quiz show Jeopardy!, the team achieved remarkable success. Watson has created applications in various fields such as healthcare and finance since.
Entrepreneurship vs. Intrapreneurship: What are the differences?
The main difference between entrepreneurship and intrapreneurship is the level of risk between both approaches. Entrepreneurs embrace the entire risk associated with initiating and managing a new venture, including the potential for financial failure. On the other hand, intrapreneurs operate within the an established organization and successful organization, which can provide invaluable support in terms of finances, logistics, and marketing for their initiatives.
Another significant distinction lies in the level of control and decision-making authority. Entrepreneurs enjoy complete autonomy over their businesses, singlehandedly making all crucial decisions. Intrapreneurs, however, must adapt to their organizational structure and collaborate with a range of stakeholders, including managers, executives, and fellow employees, to obtain support for their ventures.
Assessing Advantages and Disadvantages:
Both entrepreneurship and intrapreneurship possess unique advantages and drawbacks. Entrepreneurs have the potential for substantial financial rewards and the opportunity to build something from zero. However, entrepreneurship also carries a considerable degree of risk and uncertainty, demanding substantial investments of time and resources.
Intrapreneurship, on the other hand, affords the benefits of operating within an established organization, including access to resources and support systems. Intrapreneurs can pursue projects that align with their personal and professional aspirations while gaining valuable experience in conceiving and implementing new initiatives. Nonetheless, intrapreneurs may encounter challenges in securing backing and funding for their projects and may have limited control over the ultimate direction of their endeavors.
However, both can leverage on the advantages the other brings to drive success. Large organizations stand to gain from the innovation and creativity of intrapreneurs, who bring fresh ideas and novel perspectives. Simultaneously, entrepreneurs can leverage the resources and expertise of established organizations to help transform their ideas into marketable realities
