Intrapreneurs: UK Could Benefit from Spirit of Small Business

The Chartered Institute of Personnel and Development (CIPD) reveals that entrepreneurial spirit drives value in start-ups and small businesses and that UK business as a whole could learn a lot from our SMEs…

Entrepreneurial Spirit Driving GrowthA report from the CIPD has said that if the spirit and drive behind startups and small businesses were to be taken on by other sectors, the UK economy could thrive.

How this can be achieved, says the CIPD, is through a business culture of big firms helping their staff to adopt a mindset and actions that promote innovation and growth.

The Rise of Intrapreneurialism

To foster the spirit of the SME, the CIPD has identified that the culture of "intrapreneurialism" should be adopted.

Coined in the late 1970s and first attributed to American entrepreneur Gifford Pinchot & his wife Elizabeth in the early 1980s, the term "Intrapreneur" applies to someone working as if they were an entrepreneur but a large organisation.

In a paper in 1978, Gifford & Elizabeth Pinchot identified that size was a problem with big business and that top-level decisions were often made far from the hands-on expertise at the "coal face". They proposed a new system of intra-corporate entrepreneurship.

Examples of entrepreneurship have included the Lockheed Martin "Skunk Works" group, which started developing US jet planes in the latter years of WWII and then went on to create the U2 spy plane and SR-71 Blackbird.

By working on the top-secret XP-80 jet fighter project, the Skunk Works team worked autonomously from the parent company, Lockheed Martin, and allowed them to be innovative as well as independent.

Entrepreneurial Spirit Driving Growth

The CIPD have examined the people management skills that make entrepreneurial businesses thrive and published the results in their report Entrepreneurial spirit driving growth.

The findings from the CIPD show that 37% of employees are keen to take on an intrapreneurial role within a bigger organisation yet only 12% of firms encourage or facilitate such practices.

According to the CIPD’s findings, the UK’s entrepreneurs typically grow sales by 20% year on year and that the country’s Small and Medium-sized businesses generate 52% of the private sector’s gross added value. If bigger businesses were to provide such growth then the UK as a whole would benefit to a far greater degree.

In the report, big firms Microsoft and Alcatel-Lucent are named for their intrapreneurial environments alongside smaller firms Little Dish and A Suit that Fits.

Clair McCartney, the report’s author, has mapped out five differentiators for businesses wishing to adopt a more intrapreneurial spirit.

1. Profit and Caring

Entrepreneurs are marked as having a sincere urge to help their local communities and instill such values in their teams. This is a marked difference from larger businesses who are often seen to be solely in pursuit of profit. So it’s OK to care and adopt a line of corporate social entrepreneurship.

2. Punching Above their Weight

The businesses of entrepreneurs have no limits defined by physical size, resource or finance. As such these businesses punch well above their weight because they adopt and adapt other benefits in ways that big businesses are often unable to do.

3. Business Strategy in Co-operation with Customers

Entrepreneurs apparently stand out most when it comes to co-operation with their customers, whom they like to involve in the creative process. Entrepreneurial businesses listen to their clients and draw upon their ideas and insights to ensure the business and brand stay fresh, according to McCartney.

4. Make Room for Innovation

Entrepreneurial businesses place a lot of emphasis on employee innovation, supporting their intrapreneurs with innovation days, cross-team collaboration and being inspired by working directly with customers.

5. No Fear of Failure

Entrepreneurs are most likely to pick themselves up and dust themselves off when they fail and then they move on to the next thing. The creative and innovative processes involve an element of failure and they are happy to accept this risk, make mistakes and learn from their failures.

Claire McCartney, Research Advisor at the CIPD, said:

“There’s no doubt that a successful business depends on innovative ideas and sound market strategy, but this report shows that good people management is crucial to the long term success of any business.”

Speaking about maintaining the spirit of the entrepreneur in mature businesses, McCartney added:

“As start-up companies grow, it can be easy for the entrepreneurial spirit that made it so successful in the first place to wane, but the companies we’ve spoken to have proven that even the largest organisations can retain an innovative edge if they pay close attention to attracting, retaining, engaging and developing the right talent to live and breathe the values of the founders.”

Holly Tucker, the Co-Founder of online marketplace notonthehighstreet.com, said of the CIPD research:

“Big businesses can learn a lot from this advice. We started in 2006 with just a handful of people and passionate belief in what we were doing. As such we recruited people who shared our vision and values; they were completely aligned to where we saw ourselves and the business going.”

Talking about her team, Tucker went on to add:

“We’re incredibly successful because of the quality of our workforce; and we really listen to what our customers want. Our employees have space to grow professionally in a nurturing environment and develop their passion for innovation, driving our business forward.”

See the CIPD report at Entrepreneurial spirit driving growth (PDF)

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