Entrepreneurship and intrapreneurship are two terms that are often used interchangeably, but they actually refer to two distinct types of business endeavours.
In this blog post, we will explore the differences between entrepreneurship and intrapreneurship, their advantages and disadvantages, and how they can complement each other in the business world.
What is entrepreneurship?
Entrepreneurship can be defined as the process of creating and managing a new business venture with the aim of making a profit. An entrepreneur is an individual who takes on the risks and rewards of starting and managing a business. Entrepreneurs are known for their innovative spirit and willingness to take calculated risks to bring new products, services, or ideas to market. They often have a vision for a new business or product, and are willing to invest their own time, money, and resources to make it a reality.
What is intrapreneurship?
Intrapreneurship, on the other hand, refers to the process of developing new business ideas, products, or services within an existing organisation. Intrapreneurs are employees who have an entrepreneurial mindset and are given the freedom and resources to innovate and take risks within the structure of their organisation. They are often given the autonomy to pursue new ideas and projects, and are rewarded for their success in developing and implementing new initiatives.
Some of the best examples of intrapreneurship are:
- Google’s “20% time” policy: Google allows its employees to spend 20% of their time working on projects of their own choice. This has led to the development of some of Google’s most successful products, including Gmail and Google Maps.
- Apple’s iPod: Apple’s iPod was developed by a team of engineers and designers within the company, led by Jon Rubinstein. They were given the freedom to work on a new product that could compete with existing MP3 players on the market.
- IBM’s Watson: IBM’s Watson was developed by a team of researchers and engineers within the company, led by David Ferrucci. They were given the freedom to work on a new artificial intelligence system that could compete on Jeopardy!, a popular quiz show. Watson went on to defeat the show’s human champions and has since been used in a variety of applications, including healthcare and finance.
What are the differences between entrepreneurship and intrapreneurship?
One of the main differences between entrepreneurship and intrapreneurship is the level of risk involved. Entrepreneurs must bear the full risk of starting and managing a new business, including the possibility of financial failure. In contrast, intrapreneurs operate within the safety net of an existing organisation, which can provide financial, logistical, and marketing support for their initiatives.
Another difference between entrepreneurship and intrapreneurship is the level of control and decision-making power. Entrepreneurs have complete control over their businesses and can make all the decisions themselves. Intrapreneurs, on the other hand, must navigate the organisational structure and work with various stakeholders, including managers, executives, and other employees, to gain support for their initiatives.
What are the advantages and disadvantages?
Both entrepreneurship and intrapreneurship have their advantages and disadvantages. For entrepreneurs, the main advantage is the potential for high financial rewards and the ability to build something from scratch. However, entrepreneurship also comes with a high level of risk and uncertainty, and requires a significant investment of time, money, and resources.
Intrapreneurship, on the other hand, offers the benefits of working within an established organisation, including access to resources and support systems. Intrapreneurs also have the opportunity to work on projects that align with their personal and professional goals, and can gain valuable experience in developing and implementing new initiatives. However, intrapreneurs may face challenges in gaining support and funding for their projects, and may have limited control over the ultimate direction of their initiatives.
Despite their differences, entrepreneurship and intrapreneurship can complement each other in the business world. Large organisations can benefit from the innovation and creativity of intrapreneurs, who can bring new ideas and perspectives to the table. In turn, entrepreneurs can leverage the resources and expertise of established organisations to help bring their ideas to market.
As the global economy continues to evolve, it is important for entrepreneurs and intrapreneurs alike to understand the differences between these two approaches and leverage them to their advantage.
