Exploring the Relevance of Intrapreneurship and Innovation in Mature Organizations

Exploring the Relevance of Intrapreneurship and Innovation in Mature Organizations

Fernando Almeida (Polytechnic Institute of Gaya, Portugal)
Copyright: © 2020 |Pages: 21
DOI: 10.4018/JBE.2020070102
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Abstract

This study intends to explore the phenomenon of intrapreneurship and the relevance of the innovation processes in mature organizations by conducting three case studies on traditional industry sectors such as the textile, metalworking, and electronic components sector. The aim is to explore the role of entrepreneurial teams in such companies, to understand the inhibiting factors of innovation, and to find the essential conditions for these organizations to continuously innovate and promote intrapreneurship within their organizations. The findings reveal that several factors constrain employee participation in this process, including lack of qualifications levels, limited resources, corporate bureaucracy, and reduced time and budget. In the conditions necessary to support the innovation process emerge the support given by the management team, the qualification of individuals and teams, and the existence of an organizational culture that promotes communication, collaboration, and tolerance to risk.
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1. Introduction

The current global economic paradigm, with rapid and constant changes, and in which new ways of producing, consuming and cooperating are constantly emerging, poses new challenges to companies. To this end, companies must be constantly developing new production models and new technologies, conceived from the generation of knowledge. Wong et al. (2005) maintain that entrepreneurship and innovation have proven to be fundamental pillars of international economic growth. Therefore, investments in R&D through the creation of new products and services become indispensable to maintain or increase the pace of growth of economies.

The generation and accelerated dissemination of new technologies have provided a shortening of the perception of time and geographical distances. In the knowledge era, innovation acts as a strategic factor for the survival and competitiveness of companies (Asim & Sorooshian, 2019). In this context, a new pattern of behavior of economic agents has emerged, in which there is a constant and accelerated search for innovation to meet the demands of new consumers. In parallel, there has been a predominance of science and technology in the production process and a greater appreciation of intangible assets like intellectual capital in companies (Abdulaali, 2018). In the intellectual capital, we can find knowledge, information, intellectual property, and experience that can be used by the organization to generate wealth. Mohtar et al. (2015) emphasize that intellectual capital encompasses knowledge acquired and accumulated from an organization, in particular, inherent to people, projects, patents, systems, and work methodologies.

The perception of innovation is still very much linked to the idea of high-tech invention. This thinking causes many companies to focus excessively on tangible goods, namely the creation and development of new products. Certainly, one of the paths, as Grimpe et al. (2017) point out, is the initial investment in the R&D area in which the company seeks to develop a new product and then try to sell it and discover its potential in the market. This dynamic often makes it necessary, along with innovation, to prospect new customers and new markets. This is an approach that can originate very high costs for companies and can inhibit many of them from innovating. However, this is not the only way to innovate. One of the key factors that companies have to look at is the development of the continuous capacity for adaptation and change. These challenges can be achieved by investing in human capital. Mariz-Perez et al. (2012) state that innovation and human capital can be considered the main intermediaries in the generation of opportunities, as well as in meeting challenges. If well harnessed, understood, and developed they can become strategic tools capable of generating growth in both economic and social dimensions.

Innovation and entrepreneurship are key factors in the growth and success of a start-up (Orlova et al., 2018; Spender et al., 2017). However, their role is not limited to the early stages of a start-up. These elements are also relevant in traditional industries and mature companies, where it is equally critical to foster the entrepreneurial spirit of business and support innovation policies that ensure the sustainability of the organization. In this sense, this study aims to explore the role of intrapreneurship and innovation in mature organizations through the use of a case study approach. In total, three case studies were considered in traditional industrial sectors such as textiles, metallomechanics, and electronic components. This empirical component is supported by previously developed theories and models that address the problem of innovation and entrepreneurship at the most advanced stages of the life cycle of enterprises. This work intends to be particularly useful for the manufacturing sector to help them to understand how this type of companies can innovate, and how to promote and maintain the innovative spirit in these companies. Furthermore, this work also aims to identify motivating and discouraging factors for innovation and entrepreneurship in these kinds of enterprises.

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