2 NATURE OF CORPORATE ENTREPRENEURSHIP

➢ CORPORATE ENTREPRENEURSHIP

○ Activities that receive organizational sanction and resource commitments

for the purpose of innovative results.

○ A process whereby an individual or a group of individuals, in association

with an existing organization, creates a new organization or instigates
renewal or innovation within the organization.

○ A process that can facilitate firms’ efforts to innovate constantly and

cope effectively with the competitive realities that companies encounter
when competing in international markets.

CE PROCESS

Strategic + Innovation + Corporate

Entrepreneurship Venturing

= Corporate Entrepreneurship

➢ STRATEGIC ENTREPRENEURSHIP

○ Strategic Renewal - Process includes, evaluating customers, products

and services by strategic importance, significance and profitability

○ Sustained Regeneration – Introduction of new products or services or

entering new markets continuously.

○ Domain Redefinition – Creation of a new product-market arena that

others have not recognized or actively utilized.

○ Organizational Rejuvenation – Sustaining or improving competitive

standing and strategies.

○ Business Model Reconstruction – Redesigning core business models.

➢ CORPORATE VENTURING

○ Larger, more established companies enter into a joint venture with one or
more small , innovative start-ups to effectively leverage corporate assets
to develop innovative products and/or services.

○ Can help established organizations to enter new markets, experiment with

new technologies, new business models and create new revenue streams.

➢ (A) INTERNAL CORPORATE VENTURING

○ Internal corporate ventures are entrepreneurial initiatives that originate

within a corporate structure and are intended from their inception
(Kuratko, Covin & Garrett, 2009).

➢ (B) COOPERATIVE CORPORATE VENTURING

○ A cooperative effort between two or more businesses to undertake a new

venture.

○ Allows the pooling of resources and knowledge to create something new.

➢ (C) EXTERNAL CORPORATE VENTURING

○ External corporate ventures are new business creation activities through

organizational modes such as corporate venture capital, acquisitions, etc.

○ Means to develop new distinctive capabilities and businesses by exploring

business opportunities outside a firm’s existing boundaries.
 ENTREPRENEURSHIP WITHIN THE CORPORATE
ENVIRONMENT

➢ FACTORS IN THE EMERGENCE OF THE ENTREPRENEURIAL ECONOMY

○ The rapid evolution of knowledge & technology promoted high-tech

entrepreneurial start-ups.

○ Demographic trends adding fuel to the proliferation of newly developing

ventures.

○ The venture capital market became an effective funding mechanism.

○ Industries began to learn how to manage entrepreneurship.

➢ NEED FOR CORPORATE ENTREPRENEURSHIP

○ Rapid growth in the number of new & sophisticated competitors.

○ Sense of distrust in the traditional methods of corporate management.

○ An exodus of some of the best and brightest people from corporations to

become small business entrepreneurs.

○ International competition.

○ Downsizing of major corporations. (could also mean expanding, ex.

Lessening employees to outsource third party)

○ An overall desire to improve efficiency and productivity.

➢ TYPES OF INNOVATION

○ (1) Incremental Innovation

■ Most common form of innovation

■ Utilizes existing technology & increases value to the customer

within its existing market (design, features, etc).

■ It may include adding new features or removing features.

 ■ Systematic evolution of a product or service into newer or larger
markets

○ (2) Radical Innovation

■ Require radical thinking and are often associated with

breakthroughs in science and technology.

■ The launching of inaugural breakthroughs.

■ These innovations take experimentation & determined vision,

which are not necessarily managed but must be recognized and
nurtured.

○ (3) Architectural Innovation

■ Modification of existing solutions for an entirely new market.

■ Refers to changing the overall design of a product by putting

existing components together in new ways.

■ Process that takes methodologies, technologies, or approaches

from one field and applies them to a different area.

○ (4) Disruptive Innovation

■ Involves applying new technology or processes to the company’s

current market, usually small, inferior then the existing, but grows
and becomes compounded until it disrupts the whole market and
the competition.

■ Happens when an innovation builds a radically new value interface.

■ Serves the evolving needs of an existing market creating entirely

new value streams and service offerings that did not exist before.

➢ 9 TYPES OF INNOVATIONS

○ 1. PRODUCT INNOVATION: consists of a more recent (improved) version

of an existing product.

○ 2. SERVICE INNOVATION: provides a way to improve interaction with

customers.
○ 3. PROCESS INNOVATION: intro of an improved production or delivery
method.

○ 4. BUSINESS MODEL INNOVATION: intro of new easy to create, deliver

and capture value.

○ 5. ORGANIZATION INNOVATION: new ways in which people manage &

share resources.

○ 6. OUTCOME DRIVEN: jobs the customer is trying to get done are used
as input in the innovation process.

○ 7. BREAKTHROUGH INNOVATION: innovations that generate a

paradigm shift in tech or science.

○ 8. INCREMENTAL INNOVATION: small continuous improvement to

existing products, services & processes.

○ 9. DISRUPTIVE INNOVATION: innovations that displace established

companies or industries.