Wk3-Ch1: Building an entrepreneurial organisation Flashcards
What is Entrepreneurship?
It is the deliberate action of bringing about innovation.
Essence of innovation is action: it is the bringing of value and doing things differently.
What are the 4 types of innovation?
- Product innovation-incremental
- Process innovation-incremental
- Position innovation-radical
- Paradigm innovation-radical
2 questions any innovator should ask?
- What can we do differently?
- What can we do better?
Radical innovation?
- Can’t be tracked back to previous version
- Destroy old ways of doing things with creative destruction
- Has to be different & bring value
Entrepreneurial organisations bring innovations that create value in the following ways:
- Increased knowledge
- INcreased efficiency
- Decreased waste
- Decreased crime or sickness
Internal innovation drivers:
- Innovation for growth (growing businesses offer some sort of innovation)
- Innovation as result of growth (growing business is forced to innovate as it gets bigger)
- innovation for competitve advantage maintenance/growth
Greiner model
Phase 1
Growth through Creativity
* Early launch stage of business
* exciting, ambiguous, stressful, informal
Crisis: Leadership
* Larger business requires more formal management, budgets, structures, controls
Greiner Model
Phase 2
Growth though Direction
* Management puts necessary structures & systems in place
* Hire functional area professionals to add to leadership team
Crisis: Autonomy
* Staff demand more autonomy as workload increases
* Delegation is necessary
* Difficult for top-management to surrender control
Greiner model
Phase 3
Growth through Delegation
* Create semi-autonomous departments & business units
* Top-management focuses on strategic moves & acquisitions
Crisis: Control
* Management starts losing control over diversified business
* lack of synergy between departments
* Duplicated efforts among departments
* poor communication between departments
Greiner model
Phase 4
Growth through Coordination
* Control is centralised and headoffice is developed
* synergies between departments are established
Crisis: Red tape
* Management establishes systems and procedures
* Cost of having systems in place starts exceeding benefit of systems
* Red tape stifles innovation and creativity
Greiner Model
Phase 5
Growth through collaboration
* Replace bureaucracy with innovators
* Simplify leadership structures and procedures
Crisis: Internal Growth
* Difficult to achieve sustainable entrepreneurship
Greiner model
Phase 6
Growth through Strategic alliances
* Mergers & acquisitions
* holding company
* manage network of companies
Crisis: Identity
* Company can lose track of they are being just one of many because of alliances
