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Often, most firms’ ability to identify and innovatively exploit the opportunities decreases when they transition from their entrepreneurial to the growth phase. However, organizations can be able to maintain their innovative nature and assert their presence in the current competitive market by adopting corporate an entrepreneurial strategy that will align their interest to that of the entrepreneurs. In order to be a position to succeed in the entrepreneurial strategies, the organizations should create and develop an enabling political and economic environment where there is a large-scale redeployment of the needed resources.
Today, the business environment has undergone drastic transformations due to technological advancements and globalisation. These changes have made the environment to become a competitive, highly dynamic, and unpredictable (Otache and Mahmood, 2015). In this regard, in a bid to remain relevant, most business firms invest a substantial part of their resources on the expansion of their business in order to compete beyond the national boundaries. One of the valuable resources that have been widely acknowledged by various studies as a contributing factor to improved business performance is the corporate entrepreneurship (Bouchard et al., 2018). A significant number of recently conducted research have established that corporate entrepreneurial activities can be largely relied upon as a source of competitive and growth strategies. However, despite the fact that most studies hold that corporate entrepreneurship can be instrumental in improving the performance of an organization, there is other research which has different views on the same. Hence, in a bid to establish the existing difference, this paper reviews two articles and highlights the main arguments presented by the authors. In addition, the paper describes the differences in the arguments and further provides recommendations on how corporate entrepreneurship can be successfully applied in various organizations.
While most studies and authors agree that corporate entrepreneurship is instrumental in enhancing the performance of an organization, Kirsner in his article published on the Harvard Business Review holds a different view on the subject. The author states that the term corporate entrepreneur does not correlate with what actual entrepreneurs do but rather it creates a state of confusion as individuals strive to be innovative in established organizations which in return contribute to their failure. The article explains that there are numerous differences that exist between real entrepreneurs and persons trying to design a new product inside a large corporation (Kirsner, 2018). The author describes that there are five things which differentiate an actual entrepreneur and a corporate entrepreneur. One of the ways through which real entrepreneurs and corporate entrepreneurs are different is how they conduct their activities (Kirsner, 2018). For instance, actual entrepreneurs are constrained by factors such as legal compliance or the approval from any department but rather they independently carry out their activities. On the other hand, individuals cannot be a position to innovate due to the fact that anything new in an organization has gone through a complicated process filled with competing for interest from various persons (Kirsner, 2018). In addition, the other reason why Kirsner believes that corporate entrepreneurship does not exist is the fact that most public organizations do not put into consideration the opinionated venture of an individual and every idea is scrutinized by analysts (Kirsner, 2018).
In a bid to describe the significance of sales force through the use of corporate entrepreneurial activities, Javalgi et al. (2014) focused on the intelligence-gathering role of sales individuals in organizations which largely rely on corporate entrepreneurship in their international business-to-business operations. The researchers have drawn the ideas of the theories of corporate entrepreneurship and further develop a conceptual model which explains that global sales individuals for companies which practice corporate entrepreneurship can enhance their performance by concentrating selling activities that are customer-orientated (Javalgi et al., 2014). The article reviews previous studies which have covered the significance of corporate entrepreneurship in various organizations. For instance, the authors explain that previous researchers have found that corporate entrepreneurship can be instrumental in helping to explain and predict the entrepreneurial activities within established organizations (Javalgi et al., 2014). Also, in terms of the absorptive capacity of clients, the authors found that salesperson working in organizations which practice corporate entrepreneurship have the capacity to evaluate the details about customers, the business environment, and the competitors and suggest new ways of increasing the performance. However, the authors state that the corporate entrepreneurial activities and the upsurge in global sales performance are moderated by the environmental variables (Javalgi et al., 2014).
The authors of the two articles have a very different view of corporate entrepreneurship in the business environment. For instance, while Kirsner does not recognize the term corporate entrepreneurship, Javalgi et al. (2014) acknowledge this term and offer its different definitions. For example, the authors define corporate entrepreneurship as an art of innovating or rejuvenating the objectives of an organization for the purpose of redefining its activities or performance. For instance, graph 2 illustrates how the introduction of innovation in various organizations contributes to an upsurge in performance.
In addition, Kirsner argues that there are no such terms as corporate entrepreneurs due to the fact that this group of people do not invest their resources on the long-term success of the organization but rather their ambitions are often cut short by activist investors who are focused on controlling all the activities of the employees (Kirsner, 2018). Thus, in this regard, Kirsner explains that it is not possible for an individual to manage his/her opinionated venture to the board or owners due to chaos or conflicting interest from individual investors. However, Javalgi et al. (2014) do not hold this view, but rather describe that the environmental variables such as individual interest cannot prevent a person working in a large and established corporation from being innovative (see graph 1). For instance, the authors state that corporate entrepreneurship can be largely relied upon by organizations to learn and capitalize on particular aspects from the entrepreneurs such as learning how to position themselves in the competitive market and attracting and maintaining the customers.
Kirsner argues that corporate entrepreneurs do not exist because organizations cannot invest a substantial portion of their resources to enable individuals with a new concept to perfect it (Kirsner, 2018). However, Javalgi et al. (2014) established that there is strong empirical evidence which suggests that corporate entrepreneurship has both exploitative and explorative capacities in the development products and the generation of new ideas for overseas markets. Thus, contrary to Kirsner’s argument, the executives of the established organizations invest considerable resources due to the fact that they know the capabilities that the corporate entrepreneurs have played critical roles of creating a new understanding about the existing products and target market and absorb details from the environment (Kirsner, 2018).
One of the reasons why particular authors or research hold different views about the role of corporate entrepreneurship in established organizations is the fact that most firms’ abilities to identify and exploit opportunities decreases as they undergo a transformation from entrepreneurial to growth phase (Kuratko, 2018). Hence, retaining this ability is the key to a successful operation in a highly dynamic and competitive market environment (Kuratko, 2018). Organizations should be able to adopt an entrepreneurial strategy which will enable them to continually innovate and effectively identifying the opportunities in order to maintain their existence. One of the ways through which large corporations can maintain their spirit of innovation and excitement is by developing a political and economic eco-structure which does not obstruct both small and large-scale investment of resources towards the creation of new products (Bouchard et al., 2018). In this regard, corporations should concentrate on the creation of systems which focus on the innovative contribution of individual participants. In addition, various companies should institutionalize practices which are focused on the establishment of a firm’s environment in which innovation and new ideas will be viewed as an accepted and appropriate reaction towards an organizational issue (Kuratko, 2018). Thus, doing this will encourage workers to be more creative and develop a passion for innovation in the company. Moreover, corporations should learn how to think and act in a dynamic equilibrium in order to be a position where they can effectively respond entrepreneurial needs of the employees. Due to the fact that the ability to identify and seize the existing opportunities in most of the large companies declines over time, the executives of these firms should promote entrepreneurship by appointing one or more experienced entrepreneur and mandating the decision as a corporate objective.
The changes exhibited in the market environment have forced most organizations to change their traditional approaches and adapt entrepreneurial strategies which will enable them to to be more innovative on a sustained basis. Despite the fact that there is an existing debate on the role of corporate entrepreneurship and whether such a term exists, it is paramount that organizations need to be innovative enough in order ensure their existence in the current globalized and dynamic market. However, to achieve this, the executives must create and develop an organizational setting that concentrates the attention of individual employee on innovation as an important activity.
Bouchard, V. and Fayolle, A., 2018. Corporate entrepreneurship. New York: Routledge.
Bouchard, V., Fayolle, A., Bouchard, V., Fayolle, A., Adler, P.S., Kwon, D.W., Amabile, T.M., Whitney, D., Amherst, C.H., Dupuis-Rabasse, F. and Emery, Y., 2018. Corporate Entrepreneurship, Knowledge and Competence Development. In Corporate Entrepreneurship (Vol. 27, No. 1, pp. 1-4). Boston, MA: Chicago University Press.
Javalgi, R.G., Hall, K.D. and Cavusgil, S.T., 2014. Corporate entrepreneurship, customer- oriented selling, absorptive capacity, and international sales performance in the international B2B setting: Conceptual framework and research propositions. International Business Review, 23(6), pp.1193-1202.
Kirsner, S. (2018, February 5). Harvard Business Review. Entrepreneurship: Why there are no such things as corporate entrepreneurship.
Kuratko, D.F., 2018. 10. The challenge of corporate entrepreneurial leadership. Research Handbook on Entrepreneurship and Leadership, p.219.
Otache, I. and Mahmood, R., 2015. Corporate entrepreneurship and business performance: The role of the external environment and organizational culture: A proposed framework. Mediterranean Journal of Social Sciences, 6(4), p.524.
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