Entrepreneurship Versus Intrapreneurship

Entrepreneurship versus Intrapreneurship1 veronica MAIER2 Cristiana POP ZENOVIA Abstract This paper provides a review of theoretical studies on the beliefs of entrepreneurship and intrapreneurship, pinpointing the similarities and differences between them. Entrepreneurship continues to thrive in almost all corners of the world. Entrepreneurs argon reshaping the business environment, creating a world in which their companies play an important role in the vitality of the global economy. But there is not of all time necessary to establish a company in order to implement natural ideas.A large potential drop lies in applying business principles deep down alive organizations. Keywords entrepreneurship, intrapreneurship, human capital, business, leadership JEL classification L26 Introduction Why argon entrepreneurs and intrapreneurs suddenly more(prenominal) important today than before? An explanation to this question would be that the world is ever-changing nowadays more rapidly un der the influence of rising technologies. The increasing competition hinders our work. It does not get along anymore to stand before our competitors simply driven by our will of competing we have to convey something new to the market.Entrepreneurs and intrapreneurs play a decisive role as they help the company (newly established or real) to assume in new business and enter new markets. The theory of entrepreneurship is seen as the process of uncovering and growing an prospect to create value through innovation and seizing that opportunity without regard to either resources (human and capital) or the location of the entrepreneur in a new or existing company (Churchill, 1992). 1 2 Investing in people Ph. D. scholarship, Project co-financed by the SECTORAL OPERATIONAL PROGRAM FOR HUMAN RESOURCES DEVELOPMENT 2007 2013, antecedence Axis 1. Education and training in support for growth and development of a knowledge ground society, Key area of intervention 1. 5 Doctoral and pos t-doctoral programs in support of research. Contract nr. POSDRU/88/1. 5/S/60185 INNOVATIVE DOCTORAL STUDIES IN A KNOWLEDGE BASED SOCIETY Babes-Bolyai University, Cluj-Napoca, Romania Veronica MAIER, Babes-Bolyai University, Romania E-mailveronica. emailprotected com Cristiana POP ZENOVIA, Babes-Bolyai University, Romania E-mailcristina. emailprotected com Volume 12, protrude 5, December 2011 971 go off of foreign Comparative solicitudeIntrapreneurship bet the initiation and implementation of advance(a) systems and practices within an organization, by some of its staff under the supervision of a manager who takes the role of an intrapreneur, in order to improve the economical performance of the organization, by using a part of its resources, namely those that previously have not been used in an appropriate manner. Intrapreneurship improves the economical and fiscal performance of the company, by applying a more efficient use of the resources and by using a adapted motivation al system for its employees (Istocescu, 2003).Similarities and differences between entrepreneurship and intrapreneurship Unlike the entrepreneur, the intrapreneur acts within an existing organization. The intrapreneur is the revolutionary inside the organization, who fights for smorgasbord and vicissitude from within the system. This may give rise to conflicts within the organization, so respect is the necessary key in order to channel these conflicts and transform them into positive aspects for the organization.Even though intrapreneurs benefit from using the resources of the organization for the implementation of the appear opportunities, there are several motives why innovation is more difficult to implement in an existing organization, such as (Malek & Ilbach, 2004) The size the bigger the organization the more difficult it is to have an overview of the actions of every employee deficiency of communication Specialization and separation, help in concentrating on the areas o f interest, but hinder communication. inhering competition Internal competition amplifies the problem because instead of sharing the knowledge with others it borders the knowledge sharing. Everyone wants to keep the information for themselves. Feedback received in case of advantage/mistake Costs in case of failure are too great and the reward for a successful outcome too small. Intrapreneurs must be allowed to commit mistakes, because such mistakes are an inevitable part in the entrepreneurial process. The recognition of success is also very rare.No company provides honorarium in advance for what an entrepreneur might accomplish, but a lot of them like to talk more or less the concept of intapreneurship and expected their employees to get seed and assume their guess. But finally, when motivated employees get involves and have success their only reward is a small bonus. Dullness Many companies are slow and reluctant to change. Intrapreneurs happen many times into the well kn own sentence We always did it this way, which leaves little or no space to creativity.The willingness to try new things appears only when the companys shortcomings become apparent, but even so they dont give room to an innovative leadership. Hierarchies Organizational hierarchies compel employees to ask permission for actions that fall outside their occasional duties. The more complex the hierarchy the more difficult it is to impose change. Hierarchies 972 Volume 12, Issue 5, December 2011 Review of International Comparative Management have also tended to create a short-term thinking.Employees on disdain hierarchical levels have a Victim-Mentality due to a reduced area of action and reduced responsibilities. Those who gaze to implement innovative ideas should first consider what the ruff option for them is as an intrapreneur, as part of an existing organization, or an entrepreneur in a newly established company. In order to give an coiffe to this question an analysis of the ad vantages and disadvantages of both concepts is traind. The table below helps someone decide what type of business best suits him after confronting him with the advantages and disadvantages that await him.Table 1 Entrepreneurship and intrapreneurship advantages and disadvantages ENTREPRENEURSHIP Advantages Disadvantages You are your own boss independency Money pressure talent up on the security of a regular paycheck The income increases Less benefits as the business is new You have the chance to be original You have part of excitement and adventure Long working hours Mistakes are magnified There are a lot of possibilities Salary potential you decide upon your wholly decisions must be made alone own salary INTRAPRENEURSHIP Advantages Disadvantages Ability to stay in a friendly, well known Reward may not be up to expectation environment instauration may not be appreciated Practicing your skills within an organizaaccordingly tion lower risk You can be innovative but to a cerUsing companies resources, good name, tain limit you are not your own knowledge boss admittance to customers, infrastructure After seeing the pros and the cons of each concept we think that it is useful to see also the similarities and differences between these two concepts.Morris & Kuratko (2002) are of the opinion that the literature is sometimes confusing in underlining what exactly makes an entrepreneur varied from an intrapreneur and what they have in common. This is why they point out a serious a similarities and differences Review of International Comparative Management Volume 12, Issue 5, December 2011 973 Table 2 Entrepreneurship and intrapreneurship similarities and differences Similarities some(prenominal) involve opportunity recognition and definition. both require a unique business concept that takes the form of a product, process, or service. Both are driven by an individual champion who works with a team to bring the concept to fruition. Both req uire that the entrepreneur be able to balance vision with managerial skill, exasperation with pragmatism, and proactiveness with patience.Both involve concepts that are most vulnerable in the formative stage, and that require adaptation over time. Both entail a window of opportunity within which the concept can be successfully capitalized upon. Both are predicated on value creation and accountability to a customer. Both entail risk and require risk management strategies. Both require the entrepreneur to develop creative strategies for leveraging resources. Both involve significant ambiguity. Both require harvesting strategies. Differences In start-up entrepreneurship, the entrepreneur takes the risk in intrapreneurship and the company takes the risk other than career-related risk. In start-up the individual entrepreneur owns the concept and business in intrapreneurship the company typically owns the concept and intellectual rights with the individual entrepreneur having little or no equity in the venture at all. In a start-up potential rewards for the individual entrepreneur are theoretically unlimited where in intrapreneurship an organizational structure is in steer to limit rewards/compensation to the entrepreneur/employee. In a start-up venture, one strategic gaffe could plastered instant failure in intrapreneurship the organization has more flexibility for management errors. In a start-up the entrepreneur is subject or more susceptible to outside influences in intrapreneurship the organization is more insulated from outside forces or influence. Source Morris, 2000Other famous authors have also pinpointed some differences between entrepreneurship and intrapreneurship. Even though intrapreneurship is rooted in entrepreneurship (Amo & Kolvereid, 2005 Antoncic, 2001 Davis, 1999 Honig, 2001), there are several differences between these two concepts. In this context Antoncic & Hisrich (2003) refer that while intrapreneurs make risky decisions by using the resources of the company, the entrepreneurs make risky decisions using their own resources (Antoncic & Hisrich, 2003). Intrapreneurship takes place among employees from within an organization while entrepreneurship tends to mainly be externally focused (Antoncic & Hisrich, 2003 Davis, 1999).Entrepreneurs prefer to develop mute knowledge, in new organizations, instead of using procedures and mechanisms from other companies. On the other hand intrapreneurs work in organizations that have their own policies, procedures and bureaucracy (Antoncic & Hisrich, 2003 Davis, 1999). 974 Volume 12, Issue 5, December 2011 Review of International Comparative Management Although there are several differences between entrepreneurship and intrapreneurship, they also have some connections because intrapreneurship is consistently positioned as entrepreneurship within organizations (Antoncic, 2001 Davis, 1999). Conclusions In this paper we have reviewed the literature, which explores both ent repreneurship and intrapreneurship and the relations between them.An important outcome of the review is the acknowledgement of the similarities and differences between entrepreneurship and intrapreneurship and also the advantages and disadvantages of both concepts. Nowadays, when we are facing economically difficult times, entrepreneurship and inrapreneurship are an excellent light beam for breaking out of the trend trough innovation, by bringing something new on the market. Both entrepreneurship and intrapreneurship are instruments of innovation that help in creating new competencies and accessing new markets. Finally, without developing the insight towards these various aspects, no change of the company can be realized, and changing, so adapting means in fact, the survival of that company.The value created yesterday, can mean nothing today, therefore only a sustainable company, who recognizes the difference between an entrepreneur and intrapreneur, can address ideas and creativ ity into successful new values for tomorrow. Bibliography 1. 2. 3. 4. 5. 6. 7. Amo, B. W. & Kolvereid, L. (2005). Organizational strategy, individual personality and innovation behavior daybook of Enterprising Culture, 13(1), pp. 7-19. Antoncic, B. (2001). Organizational processes in intrapreneurship a conceptual integration, Journal of Enterprising Culture, 9(2), pp. 221-35. Antoncic, B. , & Hisrich, R. D. (2003). Clarifying the intrapreneurship concept, Journal of lessened Business & Enterprise Development, 2003, pp. 724 Churchill, N. C. , Reserch issues in entrepreneurship (2003). n Antoncic, B & Hisrich, R, D, Clarifying the intrapreneurship concept, Journal of Small Business & Enterprise Development, pp. 7-24 Davis, K. S. (1999). Decision criteria in the evaluation of potential inrapreneurs, Journal of Engineering & Technology Management, pp. 295327 Honig, B. (2001). education strategies and resources for entrepreneurs and intrapreneurs, Entrepreneurship Theory and Practice , 26(1), pp. 21-35. Istocescu, A. (2006). Intreprenoriat si intraprenoriat in Romania, Editura ASE, pp. 67-85 Review of International Comparative Management Volume 12, Issue 5, December 2011 975 8. Levesque, M. & Minniti, M. (2006). The effect of aging on entrepreneurial behaviour, Journal of Business Venturing, 2006. 9. Malek, M. & Ibach, P. K. (2004).Entrepreneurship. Prinzipien, Ideen und Geschaftsmodelle zur Unternehmensgrundung im Informationszeitalter, dpunkt. verlag, pp. 105-113 10. Merrifield, D. B. (1993). Intrapreneurial corporate reformation, Journal of Business Venturing, pp. 383-389 11. Molina, C. & Callahan, J. L. (2009). Fostering organizational performance. The role of learning and intrapreneurship, Journal of European Industrial Training, 33(5), pp. 388-400. 12. Nicolescu, O. & Nicolescu, C. (2008). Intreprenoriatul si managementul intreprinderilor mici si mijlocii, Editura Economica, pp. 52-59 976 Volume 12, Issue 5, December 2011 Review of International Comparati ve Management