Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
CHAPTER 3
Entrepreneurial
Spiderman
PART 1
THE ENTREPRENEURIAL
DNA
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
What entrepreneurs do (decision
making)
Entrepreneurs grasp opportunity by innovating
• Doing things differently – modifying existing
products or services, finding new marketing
strategies such as new routes to market - not
necessarily invention
• Finding a market need that is not yet met
• Bringing together the resources needed to
meet that need….quickly
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
Strategy development
• Many entrepreneurs develop strategy
instinctively and intuitively-gut feel
• The adaptive organization makes its
decisions in incremental and serial step
• For some firms, strategy development may
be systematic and deliberate but for many
entrepreneurial firms, it is likely to be
emergent, incremental and adaptive.
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
The strategy formulation cycle
CRISIS
CONSOLIDATION
GROWTH
Deliberate
strategy
formulation
Emergent
strategy
formulation
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
How entrepreneurs do it
Entrepreneurs manage through uncertainty by:
• Developing informal relationships and
networks with customers, staff and suppliers
• Create a network more than one (multiple)
networks
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
Relationship and Networks
• Core of entrepreneurial approach to doing
business is the development of relationship.
• Relationship build into an invaluable network
of contact and goodwill.
• Trust and respect
• Product or service they might ask about
reliability or after sales service.
• Credibility and capabilities
• Education and track record are important
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
Michael Dell
Dell is very much a
relationship
orientated company
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
The entrepreneurial spider’s web
Entrepreneur
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
Entrepreneurial Spider’s Web
• Entrepreneur create relationship and
networks between management and staff.
• Entrepreneur must seat in the middle of the
web to listen any reporting and issues from
all sides.
• Tend to be informal; one of direct
supervision.
• Motivating and effective in an uncertain
environment.
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
The entrepreneurial spider’s web
grows
Entrepreneur
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
How entrepreneurs do it
Entrepreneurs manage through uncertainty by:
• Developing informal relationships and
networks with customers, staff and suppliers
• Continuously strategising, developing
strategic options underpinned by a strong
vision
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
The strategy formulation cycle
CRISIS
CONSOLIDATION
GROWTH
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
How entrepreneurs do it
Entrepreneurs manage through uncertainty by:
• Developing informal relationships and
networks with customers, staff and suppliers
• Continuously strategising, developing
strategic options underpinned by a strong
vision
• Mitigating risk through information and
knowledge
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
Michael Dell
There are countless successful
companies that were started with
little more than passion and a good
idea. There are also many that have
failed, for the very same reason.
The difference is that the thriving
companies gathered the knowledge
that gave them the substantial
edge over their competition.
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
Size
Large
Small
Young
AgeMature
STAGE 1 STAGE 2 STAGE 3 STAGE 4 STAGE 5
Crisis of:
1: Leadership
1: Creativity
Evolution stages
Revolution
stages
Greiner’s Five Stage Growth Model
Growth
through:
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
Size
Large
Small
Young
AgeMature
STAGE 1 STAGE 2 STAGE 3 STAGE 4 STAGE 5
Crisis of:
1: Leadership
2: Autonomy
1: Creativity
2: Direction Growth
through:
Evolution stages
Revolution
stages
Greiner’s Five Stage Growth Model
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
STAGE 2 STAGE 3 STAGE 4 STAGE 5
1: Creativity
Size
Large
Small
Young
AgeMature
STAGE 1
Crisis of:
1: Leadership
2: Autonomy
3: Control
2: Direction
3: Delegation
Growth
through:
Evolution stages
Revolution
stages
Greiner’s Five Stage Growth Model
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
Crisis of:
Growth
through:
Size
Large
Small
Young
AgeMature
STAGE 1 STAGE 2 STAGE 3 STAGE 4 STAGE 5
1: Leadership
2: Autonomy
3: Control
4: Red Tape
1: Creativity
2: Direction
3: Delegation
4: Co-ordination
Evolution stages
Revolution
stages
Greiner’s Five Stage Growth Model
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
Growth
through:
Size
Large
Small
Young
AgeMature
STAGE 1 STAGE 2 STAGE 3 STAGE 4 STAGE 5
Crisis of:
1: Leadership
2: Autonomy
3: Control
4: Red Tape
5: ?
1: Creativity
2: Direction
3: Delegation
4: Co-ordination
5:
Collaboration
Evolution stages
Revolution
stages
Greiner’s Five Stage Growth Model
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
Implications for culture
Creative,
innovative
Opportunistic
Achievement
‘Can-do’
‘Work is fun’
Sharing information
and knowledge
Change is normal
Celebrate
success
Measured
risk taking
Belonging,
ownership
Continual
learning
Self-confident
but realistic
Close relationships
with suppliers
Close relationships
with customers
Close relationships
with staff
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
Implications for
organisational structure
Structure must encourage:
• Opportunity spotting, creativity & innovation
• Sharing information, knowledge and learning
• Sense of ‘belonging and ‘ownership’
• Delegation and decentralisation
• Development of relationships inside and
outside the organisation
Corporate Entrepreneurship: Building the Entrepreneurial Organization by Paul Burns
Implications for management
Need for:
• Strong vision, Good communication, Good timing
• ‘Light touch’ and delegation
• ‘Positive’ attitude that encourages self-confidence and self-
efficacy
• Continuous strategising at all levels
• Incremental adaptive approach to decision-making
• Openness that encourages knowledge exchange
• Avoidance of short-termism ex cost reduction via retrenchment
vs training