From the Archives: Entrepreneurship & Innovation
Before I launch into discussions on my thoughts on these two very interrelated items, I think we have to start by defining them. There is much confusion these days about the definition of these terms. Is Entrepreneurship limited to small companies? Is it the act of invention or a way of behaving? Innovation is a word that has become so overused that it is losing its meaning. So what do they mean today and how should we use them? Through this blog, I intend to explore those methods, models and behaviors that produce innovation and entrepreneurship and results. And, of course, those that consistently do not.
Innovation is traditionally thought of as new-to-the-world products. In today’s environment of rapid development, lean, cloud-based solutions, apps and software as a service, you can’t limit the definition to products. You also shouldn’t limit it to new-to-the-world. You can innovate in many ways; disruptively, from underneath, over the top, incrementally, efficiently, etc. (I will discuss these forms in later entries.) In my mind, innovation is any change that createsvalue. This wider definition allows us to count among those innovative activities not only revenue creation, but efficiency, cost savings, process improvement and my favorite, management innovation.
Entrepreneurship is the act of creativity in a business setting. Sure someone is entrepreneurial by setting up a new business, but it can happen in large corporations as well. Acting this way within an established company is often called intra-preneurship, but I don’t see the distinction. Entrepreneurship is a set of behaviors or a state of mind. It can absolutely happen in established companies, but it is often very difficult. Every fiber of a well established organization is focused on preserving the status quo. Much of my experience and research in recent years has been on how established companies can be more entrepreneurial while still protecting and growing their core capabilities; How did IBM reinvent itself, twice? How has Apple remained innovative for years in spite of becoming an enormous company? Unsurprisingly, most organizations are not very successful in remaining innovative or fostering an entrepreneurial culture. Frequently Innovations die because the organization does not have the patience to explore new opportunities, which often take time to develop into something significant to the organization. Imagine, how important is a few million in revenue to a company that sees 10s of billions? Entrepreneurship is rarely accepted inside large organizations; people who act that way go against company culture, which has been built up over the years to support and defend the established core business.
So how can organizations, small and large, embrace entrepreneurship and innovation and produce real results without disrupting their own core business? Let’s explore…