Flashcards in chapter 3 Deck (11)
Peter Drucker's four major developments that explain the rising influence of entrepreneurship.
1. The rapid evolution of knowledge and technology
promoted the development of high-tech
2. Demographic trends such as two-wage-earner
families, continuing education of adults, and the
aging population added fuel to the proliferation of
newly developing ventures.
3. The venture capital market became an effective
funding mechanism for entrepreneurial ventures.
4. American industry began to learn how to manage
Is a process that can facilitate efforts to innovate and can help firms cope with the competitive realities of world markets.
The need of corporate entrepreneurship as a response to:
1. The rapidly growing number of new, sophisticated
2. A sense of distrust in the traditional methods of
3. An exodus of some of the best and brightest people
from corporations to become small-business
Five important practices for establishing innovation-driven organizations follow
(Corporate Innovation Philosophy)
1. Set explicit innovation goals.
2. Create a system of feedback and positive
3. Emphasize individual responsibility.
4. Provide rewards for innovative ideas
5. Do not punish failures.
Advantages of developing a corporate entrepreneurial philosophy:
- often leads to the development of new products and
services, helping the organization expand and grow.
- creates a workforce that can help the enterprise
maintain its competitive posture.
- It promotes a climate conductive to high achievers
and helps the enterprise motivate and keep its best
Their commonality the adding of new business to the corporation. Can be accomplished through three implementation modes.
o Internal corporate venturing
o Cooperative corporate venturing
o External corporate venturing
Their commonality the exhibition of large-scale or otherwise highly consequential innovations that are adopted in the firm’s pursuit of competitive advantage.
These innovations may or may not result in new businesses for the corporation.
Factors in large corporations that have exhibited successful innovations:
- Atmosphere and vision.
- Orientation to the market.
- Small, flat organizations
- Multiple approaches.
- Interactive learning.
- Skunk Works
Corporate Entrepreneurship Strategy
a vision-directed, organization-wide reliance on entrepreneurial behavior that purposefully and continuously rejuvenates the organization and shapes the scope of its operations through the recognition and exploitation of entrepreneurial opportunity.
The five critical steps of a corporate entrepreneurship strategy are:
1) Developing the vision
2) Encouraging innovation
3) Structuring for an entrepreneurial climate
4) Preparing individual managers for corporate
5) Developing venture teams