Corporate entrepreneurship is the art of creating innovative ideas within a corporation and materializing them to make profit. You have to use the knowledge and creativity that exists within a person to generate money-making ideas. Many new businesses, organizations and corporations have been made because of the ingenious ideas that a single or select group of people had.
Most entrepreneurs are known as innovators as they really do change the world around them and create ideas by looking at the world around them.
A corporation is business created by law and has various liabilities and privileges that many other business do not. Although there are many forms of corporations, the most common form is limited liability.
In such corporations, investors can lose their money and employees can become unemployed. However, the investors or the employees are made accountable for the debts that have to be paid to the creditors of the corporation.
In times gone by, only a select group of people had the power to create a new product, launch a new service, give their opinion or even speak about a new idea. Fortunately, those times are no more and the value of an employee has been drastically enhanced.
In any company, new ideas are always encouraged. If an employee has an idea that could make the company money, it is important to let the senior employees know. As long as the idea you have is in line with the company’s current product or services, you are most welcome to let them known.
The process of creating a new product or service within an existing organization that will generate profit for it, is known as corporate entrepreneurship. Those who have the capability to create such ideas are known as corporate entrepreneurs.
The ideas cannot generate revenue from a side business that the entrepreneur made. The idea has to benefit the company and generate profits (usually in the short-run) otherwise it is not known as corporate entrepreneurship.
How Employees Benefit
The biggest advantages are given to the employees. There are usually two types of corporate entrepreneurs; those that are regular employees and those that are paid to generate ideas.
If you are a regular employee with great ideas, it is vital that you let your ideas known. If even one of your money-making ideas became a reality, you will probably get a promotion, bonus or even a raise. You could get either one or possibly even a combination of the three.
In the competitive corporate world of today, even one of the three would be a huge advantage. Although you do not get any external recognition, the internal acknowledgement is substantial. However, the chances of a regular employee’s idea becoming a source of major profit is rare. This is because organizations usually separately hire corporate entrepreneurs to generate ideas.
Organizations usually pay a team of corporate entrepreneurs to generate ideas. In return, they get paid. Some teams are paid based on the number of successful ideas they generate while others are paid on a monthly basis (as long as they meet a certain quota).
What’s greater is that it does not really matter who you are in the company as organizations encourage all employees equally to contribute as much as they can. If an employee has the potential to be a great corporate entrepreneur, they are encouraged to apply for the position or let their ideas be known. So long as the idea can generate substantial profit.
The Benefit of Corporate Entrepreneurs to an Organization
Organizations benefit the most from corporate entrepreneurship – they make profits. A new flavor of ice-cream could generate millions of dollars in profit for the company regardless of who it came from. Paying a corporate entrepreneur a big bonus still looks negligible in front of the profit made.
Furthermore, the recognition of a company can drastically improve with a team of corporate entrepreneurs. If the team generates a new idea that will make the company greener and save money, the company will benefit greatly.
One of the biggest advantages of encouraging entrepreneurial ideas in a company is that the company saves money on employment and still makes a profit. Smaller organizations may not have enough money to hire separate individuals to generate ideas and hence make it a company statement to generate ideas.
For the organization, you do not have to pay extra for someone to generate ideas as a raise seems substantial to many employees. The money generated from the innovation is much more that the money paid to the employee in the form of a bonus or raise (small or large).
How to Promote Corporate Entrepreneurship
There are many ways that organizations can promote corporate entrepreneurship. The most commonly used methods to promote corporate entrepreneurship include:
Quite possibly the easiest method of promoting corporate entrepreneurship is by integrating the idea in the company’s mission statement. This can be coupled by offering a large bonus or raise to employees who create innovative ideas
Employees that help the company by generating ideas will be recognized within the company in a special way in addition to financial benefits
If an average employee seems to be generating various ideas in a specific field, he/she could be promoted in order to encourage the employee to keep creating ideas
An employee can be put in charge of any future projects/ventures undertaken due to the generation of a the employee’s idea
Any employees who generate such ideas can be given stocks. Because the employee helped the company grow, the employee is given ownership in the organization. This is great motivations for a number of employees.
Corporate entrepreneurship is beneficial in many ways. An organization stands to make a lot of profit from the generation of a single successful idea. The person who generates the idea (corporate entrepreneur) stands to gain a lot of recognition (within the company) and a financial reward in the form of a raise, bonus or promotion. Regardless of where the idea came from, everyone stands to benefit from corporate entrepreneurship.