What is Intrapreneurship and How Does it Differ from Entrepreneurship?

"Intrapreneurship refers to the practice of employees behaving like entrepreneurs while working within a company. While the concept of entrepreneurship involves starting and running your own business, Intrapreneurship focuses on utilizing an entrepreneurial mindset and approach to drive innovation and growth within an existing organization. Now, let's dive deeper into the differences between entrepreneurship and Intrapreneurship."

How has the booming prevalence of entrepreneurship around the world coined this new term- Intrapreneurship?

Introduction to Intrapreneurship

Globalization and industrialization have reached their zenith in recent years, leading to a surge in new business ventures. As a result, employability rates have risen and the market has been flooded with unique and innovative ideas. With the necessary knowledge, funding, and experience, individuals are taking the leap and starting their own firms and businesses.

Entrepreneurship has become increasingly popular in recent years, providing individuals with the opportunity to design, launch, and manage their own businesses. Typically, these ventures begin on a smaller scale and grow as profits increase. Despite its familiarity, entrepreneurship has also given rise to a lucrative alternative.

Innovation and creativity are the driving forces behind intrapreneurship, which allows employees to act as entrepreneurs within the company. This concept empowers individuals to take ownership of their ideas and turn them into profitable ventures for the company. By fostering a culture of intrapreneurship, companies can tap into the entrepreneurial spirit of their employees and drive growth and innovation.

This concept was recently added to the business terminology. This article aims to shed light on this intriguing concept.

What is Intrapreneurship?

Intrapreneurship, as the name suggests, is the amalgamation of two words- intra and entrepreneur.

An intrapreneur is an individual who works within a company and takes on the responsibility of a project independently. This means that the handling, management, and ultimate success of the project are solely in their hands.

An intrapreneur shoulders the responsibility of transforming an idea or concept into a prosperous product, relying on a combination of managerial expertise and the daring, analytical mindset of an entrepreneur. It's important to understand that an intrapreneur is distinct from an entrepreneur, despite common misconceptions.

In contrast, intrapreneurship is a more structured approach that involves taking calculated risks within the framework of an established organization. While an intrapreneur still operates within the confines of a company, they are often tasked with making critical decisions that can shape the future of the organization.

As entrepreneurship gained popularity, more individuals opted to pursue their own ventures rather than work for a company. Consequently, this resulted in a scarcity of employment opportunities in management roles. To address this issue, intrapreneurship emerged as a solution. In this model, managers were entrusted with the responsibilities of an entrepreneur while still being employed by a firm. This approach not only helped combat the employment drought but also safeguarded the interests of both individuals and companies. Intrapreneurship thus became a bridge that bridged the gap between independent entrepreneurship and traditional employment.

Key Intrapreneurship points to Note

Intrapreneurship is a system that empowers employees to act as entrepreneurs within their organization. This innovative approach enables them to take on significant projects and make important decisions with the authority granted to them.

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With their confidence, proactivity, and dynamic mindset, intrapreneurs possess critical leadership abilities and are adept at thinking innovatively. Intrapreneurship serves as a stepping stone to entrepreneurship, enabling individuals to leverage their acquired knowledge to create and grow their own business ventures.

Features of Intrapreneurship

Intrapreneurship has become increasingly prevalent in the business world, serving as a bridge between established companies and innovative entrepreneurs. Its distinct and crucial characteristics contribute to its significance. Here are a few notable features of intrapreneurship.

By promoting intrapreneurship, companies can harness the potential of their employees to come up with fresh and disruptive ideas. This leads to a culture of innovation that can bring about significant financial gains. Additionally, intrapreneurship allows employees to take on more challenging roles and responsibilities, which helps them develop critical leadership skills. Ultimately, this benefits both the individual and the organization as a whole.

An intrapreneur is responsible for generating fresh and imaginative concepts, and then transforming them into profitable products. Unlike entrepreneurs, intrapreneurs do not have to finance their projects with personal funds. Instead, the company manages the financial investment entirely.

Typically, when an intrapreneur works for a company, there is a shared profit agreement in place. The company agrees to allocate a certain percentage of the profit to the intrapreneur. This makes intrapreneurship a dependable and secure business endeavor.

Intrapreneurship can be a valuable resource for individuals looking to establish their own businesses. It offers the skillset necessary to become a successful entrepreneur and allows for the cultivation of entrepreneurial skills in a corporate environment. This fusion of two distinct cultures benefits both parties involved. Although not yet at the peak of its popularity, intrapreneurship is steadily gaining recognition as a new industry term. With the rise of freelance work opportunities and remote working frameworks, this type of working culture is poised to become even more prevalent globally.

Rarity of an investment offers an added advantage, as it allows for diversification of one's portfolio. A diverse portfolio can lead to better job prospects and a substantial income.

Intrapreneurs vs Entrepreneurs – The Difference

While entrepreneurship involves starting a new business venture from scratch, intrapreneurship involves innovation and creativity within an already established organization. Intrapreneurs use their entrepreneurial skills to bring new ideas, products, or services to the company they work for, while entrepreneurs take the risk and responsibility of starting and managing their own business. Additionally, intrapreneurs have access to resources and support from the company, while entrepreneurs have to build their own networks and find their own funding. Ultimately, both intrapreneurship and entrepreneurship can lead to success, but they require different mindsets and approaches.

An Intrapreneur is a company employee who is solely responsible for managing an entire project from start to finish, including decision-making and execution. Unlike an entrepreneur, an Intrapreneur does not have to provide funding for the project as it is sponsored by the organization that they work for. On the other hand, entrepreneurs not only manage their projects but also invest their own capital and resources to bring them to fruition.

The Intrapreneur, while enjoying significant authority over the project, still maintains a connection to the organization and must ensure alignment with the company's objectives. On the other hand, an entrepreneur has complete independence in decision-making for their business and is not accountable to anyone. Unlike an entrepreneur who starts from scratch, the Intrapreneur sets up a new department within an existing firm, and while the business may start small, it has the potential to expand based on profitability.

Relation between Intrapreneurs and Entrepreneurs

There is a significant difference between an Intrapreneur and an Entrepreneur.

The previous fragments have emphasized the connection between these two concepts. To put it simply, intrapreneurship is the precursor to entrepreneurship.

An intrapreneur possesses the ability to take calculated risks and make critical business decisions.

An intrapreneur has the advantage of being able to experiment with their skills and theories without the same level of risk as an entrepreneur. They can test different methods and determine the most effective approach for their company without fear of causing significant financial losses, which can be especially detrimental for a new organization.

The skills and experiences gained through intrapreneurship are invaluable, providing a strong foundation for pursuing a career as an entrepreneur. This connection between intrapreneurship and entrepreneurship is a key advantage of incorporating intrapreneurship into your skillset.

Elements of Intrapreneurship

An intrapreneurship consists of three crucial elements. These three elements form the backbone of this concept. These three elements are as follows-

An intrapreneur or in this case, you.

Undertaking a project, whether it's the primary focus of your company or an entirely new venture, requires careful planning. Having the guidance and support of a mentor or a larger, established organization can provide the necessary authority and resources to effectively manage the project.

You and your mentor together form a strong team that takes up a project which can be either of the two mentioned above.

Here is a video byon Intrapreneurship.

Types of Intrapreneurship

There are two main types of intrapreneurship. They are as follows-

1) Intrapreneurship that adds value to the company

This type is the more common one and is employed by most companies that have adopted intrapreneurship as part of their business policy.

This concept is directly linked to the main project taken up by the company.

The main project adds value to the company.

Your proposed innovation has the potential to not only increase the profitability of your company but also foster a culture of creativity, innovation, and unconventional thinking among your employees.

2) Intrapreneurship managing spin-off projects

Spin-off projects, although not directly connected to the main project, hold significant value and profitability for a company handling multiple projects simultaneously. Thus, they are just as crucial to the firm as the main project, contrary to popular belief.

Instead of immediately diving into a new business venture, companies may opt for spin-off projects as a smaller step forward. In such cases, the decision is made to establish a new entity within the same firm, with an intrapreneur at the helm to handle its operations.

The level of parent company involvement in a project is contingent upon its nature. In some instances, there could be a sharing of resources or knowledge transfer between the parent company and the intrapreneur.

The need for Intrapreneurship in Today’s Time

Restricting the creativity and innovative thinking of employees can have a detrimental impact on the growth and success of a company. As a valuable asset, employees play a crucial role in determining the progress and overall development of an organization. It is therefore important for companies to foster a culture that encourages and values the contributions and ideas of its employees, thereby promoting both individual and organizational growth.

Restricting the exploration of fresh concepts can result in being left behind and becoming outdated. In order to remain competitive in today's business landscape, companies cannot afford to do so.

Numerous approaches exist to empower staff to tap into their creativity and mental capabilities. Intrapreneurship is a powerful tool that allows employees to showcase their innovative ideas and abilities. It offers a space for them to operate under challenging circumstances and high-pressure situations. They learn to take calculated risks and handle complex challenges.

Intrapreneurship can provide a training ground for individuals to develop these qualities and prepare them for the challenges of entrepreneurship. Thus, implementing intrapreneurship not only benefits the company but also the career growth of its employees.

Intrapreneurship can facilitate the development of essential skills and offer a secure platform to experiment with new ideas. This approach also enables organizations to identify and implement effective policies.

Intrapreneurship has emerged as a solution to bridge the gap between traditional management and entrepreneurship in the business world. With the rise of entrepreneurship, there has been a shortage of skilled managers, leading to unemployment. However, intrapreneurship allows employees within an organization to take on the role of an entrepreneur and manage an entire project independently. This concept not only benefits the organization by fostering innovation and creativity but also provides a platform for employees to showcase their entrepreneurial skills while enjoying the security of a stable job.

Unlike entrepreneurs, Intrapreneurs have the freedom to innovate and create without the burden of financial risk. With the company taking care of funding and resources, they can focus solely on bringing their ideas to life and adding value to the organization. However, they are still accountable to the company and must ensure their initiatives align with its goals and values. In essence, Intrapreneurs enjoy the best of both worlds – the autonomy to innovate and the security of a stable working environment.

Intrapreneurship and entrepreneurship share a delicate balance, with the former often leading to the latter. As such, these concepts are closely linked and crucial for businesses to adopt. Intrapreneurship equips employees with essential qualities and skills, making it a vital component of modern business policies. What are your thoughts on the significance of Intrapreneurship today? Do you believe it will shape the future of business? Share your views with us in the comments section below.