In business, ambiguous terms and catchphrases frequently emerge that may confuse the savviest entrepreneur or executive. While not new, the term “intrapreneurship” is enjoying a resurgence of sorts. Often referred to as “corporate renewal,” intrapreneurship is the process by which organizations maintain an edge in innovation and profit making by having employees spawn businesses within the wider organization.
These businesses start with an idea and eventually morph into a new division or product line that is isolated from the rest of the organization in order for it to develop its own niche and have room to grow.
An Intrapreneurial Publisher
Intrapreneurship aptly describes how Janet Hill launched Harlem Moon Books in 2000. Hill is vice president and executive editor at Doubleday Broadway Publishing Group, a division of Random House Inc. in New York, and sits at the helm of the unit that publishes African-American fiction and nonfiction titles. Harlem Moon is an imprint of the Doubleday Broadway Publishing Group.
For Hill, the creation of Harlem Moon is an idea that became a multimillion-dollar reality as sales of books by and about people of color began to soar. According to figures from Target Market News, African-Americans spent about $300 million on books each year between 2000 and 2004.
“The literary market was changing and we needed to adjust to the change,” Hill says in an interview with The Network Journal. “Starting Harlem Moon was my idea and I received a lot of support from my publisher and editor in chief.”
Doubleday already published a wide range of Black titles, but Hill surmised that the organization would be unable to handle the influx of new African-American authors and books. Moreover, niche-marketing strategies had to be developed to include a growing audience. “In 2000 we did not have a built-in paperback publishing arm,” Hill says. “By starting Harlem Moon, we could freely publish books in both hardcover and paperback or as Harlem Moon original paperbacks.”
Today, some of the most popular Harlem Moon titles include Love Is Stronger Than Pride by E. Lynn Harris and a reprint of Langston Hughes’ novel Tambourines to Glory, which has an introduction by TNJ contributing writer Herb Boyd.
Another advocate and intrapreneurial success story is Linda Gooden, president of Lockheed Martin Information Technology in Bethesda, Md. The company has operations nationwide, including in New York and New Jersey, as well as worldwide. “Encouraging intrapreneurship has the potential to make bureaucratic businesses more agile and better able to adapt to a globally competitive world,” Gooden says. “The whole thing starts with an idea.”
She should know. She heads the Lockheed IT unit that she formulated and pitched to senior company execs at Lockheed several years ago. Among other things, the unit services contracts with technology services and software for various government agencies, particularly the Department of Defense and Homeland Security.
“I wasn’t sure if they would like my idea,” Gooden says. “I had spent months researching and drafting a proposal with the condition that if they accepted my plan, I would be made president of the division.”
Gooden frequently espouses the idea of intrapreneurship to her colleagues, saying it entails a simple and cogent five-step process, from concept and planning through sale, execution and adaptation.
“Any company looking for a sustainable expansion and profitability can benefit from intrapreneurs. There is a misconception that only IT-based firms can benefit from intrapreneurship and this is not true,” she says.
Other examples of businesses that could benefit from Gooden’s five-step plan include a mom-and-pop retail store that could, say, shift demographics and capitalize on a changing customer base by opening a store in a different location, and larger retail businesses. Bookseller Barnes and Noble, for example, effectively countered Amazon.com’s initial moves into the retail book market by capitalizing on a “click and mortar,” or online store, approach to business.
Some experts contend that the real challenge in successfully unleashing a new business within a business is getting management and employees to believe that the practice is common and not just an isolated act.
Joshua Estrin is the president of Concepts in Success, a consulting firm in Plantation, Fla., with clients in New York and New Jersey. The company specializes in helping clients leverage the competencies of employees and use the assets within, key components of intrapreneurship.
“Companies of all sizes are going to have internal markets, and implementing those ideas are easier to do in a small company than in large ones,” Estrin says. “The reason is due to the geographic differences and bureaucracies in those [large] companies.”
Not everyone is a proponent of the intrapreneurship concept. Some see it as nothing more than a myth created by overzealous corporate employees to become well-compensated test rats. “Intrapreneurship is like running a race with the brakes on,” says Greg Stuart, co-author with Rex Briggs of the book What Sticks: Why Most Advertising Fails and How to Guarantee Yours.
Stuart says intrapreneurs don’t have to be gregarious or overly prosperous in their businesses because they continue to enjoy perks from the parent company during the test phase. “Intrapreneurs usually have the backing of a corporation and will continue to collect a paycheck even if the division or product flops,” he says.
In the end, the notion of intrapreneurship is interesting, but it is nothing more than the same corporate structure with new verbiage, argues Carol Anne Carroll, author of the book Start Your Own Home Business in No Time (Que, 2004. ISBN 0789732246). It also is a far cry from entrepreneurship, she says. “The entrepreneur is [still] the only one who truly has complete control and is better off for the long term,” she says.
Intrapreneurship vs. Entrepreneurship
What exactly is the difference between the two “-ships”? Interviews with several experts yield the following responses:
1. Intrapreneurs are employees of a company with free rein to run a particular aspect of the comapany—a new product line or subsidiary; entrepreneurs are self-employed people running their own companies.
2. Intrapreneurs know that if they fail, the company is still going to make sure they have a paycheck—at least for a while. In the event of failure, entrepreneurs have nothing to fall back on other than what they possess.
3. Because of the system in which they work, intrapreneurs are chosen based on corporate standards, not entrepreneurial success. Entrepreneurs, however, do not have to worry about whether they attended the right schools, but whether they will make enough money to meet payroll and pay bills.
4. Intrapreneurs usually are selected by a corporate structure and don’t have to worry about building the structure they need, while entrepreneurs build the structure themselves.
5. Intrapreneurs generally will have to take their decisions to a superior, whereas entrepreneurs answer to themselves.