Comparison of Corporate Entrepreneurship and Real Entrepreneurship

This paper presents different dimensions of corporate entrepreneurship as reflected in the two articles by Scott Kirsner (2018), and Javalgi, R.G., Hall, K.D. and Cavusgil, S.T (2014). Kirsner argues that corporate entrepreneurs are bound to fail as a result of a wide range of factors such as resistance. Jalvagit et al (2014) on the other hand argue that salesperson can be an integral part to the success of corporate entrepreneurship as they serve as agents of collecting intelligence from the market. For the purpose of this paper, the article by Kirsner will be referred to as the first article, and the other one by Jalvagi and Co. as the second article.

Introduction

The two articles present corporate entrepreneurship from two different perspectives but with some few similarities. The first article basically compares several elements as they can be depicted in both “true entrepreneurship,” and corporate entrepreneurship, with the author arguing that there is no such a professional as a corporate entrepreneur in the business world. The argument is not entirely against the existence of corporate entrepreneurship as the title may suggest, but rather pointing out the facets that lack in this model of investment or practice by individuals in an organization. On the other hand, the second article presents a study conducted to find out the contribution of international B2B salespersons towards corporate entrepreneurship through their ability to collect market/consumer intelligence. The fundamental difference between the two articles is thus vested in the fact that the first article negates the authenticity of corporate entrepreneurship, whereas the second article recognizes its existence, and the authors seek to propose means by which salespersons can be an integral part to promoting it. In this paper, the key arguments in each article will be presented, followed by the differences depicted from these arguments, and then recommendations with respect to the arguments.

Key Words

Corporate entrepreneurship, real entrepreneurship, Customer-oriented selling, Innovation, Competitive advantage.

Key Arguments of the Authors

The major common element between the two articles is corporate entrepreneurship. Kirsner (2018) observes that there is no such thing as “corporate entrepreneurship” a concept or term that he observes that to some extent devalues the “real entrepreneurship.” Benneth (2018, pp. 15) defines corporate entrepreneurship as a process by which an existing organization develops new businesses, products, processes or services with the aim of generating revenue and creating value for the company. On the other hand, entrepreneurship, also referred to as real entrepreneurship by Kirsner (2018) is defined as the willingness and capacity to venture into a new business with an aim of making profits regardless of the risks associated (Benneth 2018, pp 13). In the second article, Javalgi, Hall, and Cavusgil, (2014) on the other hand recognize the existence and significance of corporate entrepreneurship.

Javalgi et al. (2014, pp. 1198) argue that the performance of international sales for the companies that practice corporate entrepreneurship can only be enhanced if the capacity of their sales persons is built for them to be able to practice customer-oriented selling, and more so when the firm’s absorptive capacity is enhanced. The authors state that it is through exploiting what other firms do not see that entrepreneurship becomes successful, and this is an advantage that the sales persons of the larger companies can employ by learning more about their customers, and using this information to enhance corporate entrepreneurship. Therefore, the main argument by Javalgi et al. (2014) is that large international companies can promote their entrepreneurial initiatives by collecting relevant information through salespersons.

Kirsner (2018) presents five core differences between entrepreneurship and corporate entrepreneurship stating that corporate entrepreneurship whether initiated by an employee or hired individuals is bound to fail due to the resistance it is faced with. The author states that bureaucracy in terms of processes and meetings make a major difference between the two concepts, with entrepreneurship moving faster. Also, the author states that corporate entrepreneurs below the CEO levels in large companies, which includes the salespersons cannot realize the economic upside of entrepreneurship compared to real entrepreneurs. There is a general fear of failure that is registered among entrepreneurs, an element that lacks in corporate entrepreneurship (Kirsner 2018). Moreover, real entrepreneurs are presented as more persistent with a bigger ambition to realize their goals. On the other hand, corporate entrepreneurs are affected by the change in leadership or organizational strategy, and most often are faced with dismissal when this happens.

Differences in The Arguments

The primary difference between the two articles as indicated in the previous section is the standpoint of the authors with regard to corporate entrepreneurship. Kirsner (2018) argues against the process whereas Jalvagi et al. (2014) argue on means by which this practice can be enhanced for the purpose of promoting the organizational competitive edge. Jalvagi et al. (2014) argue that the existence of sufficient resources in an organizational setting is an advantage to the companies that intend to carry out entrepreneurial initiatives and more so because they possess knowledge that help them to make savvy decisions with regard to entrepreneurship (pp. 1194). Kirsner (2018) portrays the existence of these resources as a setback to entrepreneurship whereby the people charged with these initiatives are not as persistent as true entrepreneurs. Kirsner (2018) states that large

Another difference in the argument regarding corporate entrepreneurship regards the role of the people who partake these initiatives. Both articles concede that the organizations might bring on board new employees charged with the purpose of revamping processes, business and products. Jalvagi et al. (2014) present the salespersons as the best suited individuals to initiate corporate entrepreneurship through collecting all the relevant information regarding the customers in a B2B setting. Kirsner (2018) on the other hand observes that most organizations are not willing to invest time in corporate entrepreneurship, and even when they do, a change in strategy or leadership brings down the progress followed by dismissal of the teams or individuals. A case in point is that of Target where three employees were hired for the purpose of entrepreneurship in March 2015, and this group had been dismissed by June 2017. The point in this case is that true entrepreneurs are more willing to invest time in their ventures compared to the corporate entrepreneurs.

Jalvagi et al (2014) recommend the exploitation of entrepreneurial opportunities through customer-oriented marketing, two practices that are associated with an overall growth in profits. Kirsner (2018) views corporate entrepreneurship as detrimental to individual growth, stating that whether an employee is a long-term veteran or an outsider brought in to build businesses, using the word entrepreneur while operating within the organization sets them up to fail (pp. 3). The author states that bringing in new people to drive corporate entrepreneurship creates a subculture that the employees within the organization are not willing to embrace. Contrary, Jalvagi et al. (2014) advocate for the use of employees to drive entrepreneurship within organizations.

Recommendations

Grațiela (2017, pp. 17) observes that in the modern business atmosphere, organizations need to remain vibrant in promoting innovation in all facets of business including marketing, production and logistics among others. This necessitates corporate entrepreneurship whereby, organizations redefine their operations to suit the intensively changing markets. Vahdet et al. (2018, pp. 127) state that innovation on itself is not sufficient to sustain growth of a company, an observation that Kirsner (2018) and Jalvagi et al (2014) agree with. There is the need for organizations to develop frameworks that can support these innovations to enhance investment of resources into priority corporate entrepreneurship initiatives and register positive outcomes in the process (Jianhong et al. 2017, pp. 58)

Despite standing against corporate entrepreneurship, Kirsner (2018) states that companies can still explore new business models, design products that suit their market information, or develop new experiences for their customers. However, as Provasnek et al (2017, pp. 529) also suggest, Kirsner proposes that companies need to embrace the rewards and risks that are quite different compared to those experienced by true entrepreneurs. It is thus important for companies to rush and be the first ones to introduce new products or models in the market, and more importantly to device managerial systems that are supportive to these initiatives. Unlike the entrepreneurs who are faced with bigger risks of ending their entrepreneurial dreams as a result of unprecedented events such as lack of sales, companies enjoy antecedent systems that can keep on running as they invest in other entrepreneurial initiatives (Ahmed et al. 2018, pp. 24).

Conclusion

The authors present differing standpoints regarding corporate entrepreneurship, with some few similarities regarding the same. The first article by Kirsner is developed to highlight the differences that exist between what the author refers to as true entrepreneurship and corporate entrepreneurship, whereas the second presents a case of using salespersons to promote the latter. Both articles concede that entrepreneurship, whether by corporations is critical to suppressing competition in any given industry but only when implemented strategically. A core difference in the argument by the authors of the two articles is vested in the roles that employees play in corporate entrepreneurship. Kirsner (2018) suggests that these employees are more likely to fail as a result of resistance from the others, whereas Jalvagi et al. (2014) suggest that the employees and more specifically the salespersons can be a huge resource in the success of corporate entrepreneurship.

References

Ahmed, U, Shah, Sa, Qureshi, Ma, Shah, Mh & Khuwaja, Fm (2018) ‘Nurturing Innovation Performance through Corporate Entrepreneurship: The Oderation of Employee Engagement’, Studies in Business & Economics, 13(2), pp. 20–30. doi: 10.2478/sbe-2018-0017.

Benneth Uchenna Eze (2018) ‘Corporate Entrepreneurship and Manufacturing Firms’ Performance’, Emerging Markets Journal, Vol 8, Iss 1, Pp 12-17 (2018), (1), p. 12. doi: 10.5195/emaj.2018.146.

Grațiela Mihaela Feraru (2017) ‘Corporate Entrepreneurship as a Mechanism to Turn Innovation into Competitive Advantage’, Analele Universităţii Constantin Brâncuşi din Târgu Jiu: Seria Economie, Vol 1, Iss special issue, Pp 213-219 (2017), (special issue), p. 213.

Javalgi, R.G., Hall, K.D. and Cavusgil, S.T. (2014) ‘Corporate entrepreneurship, customer-oriented selling, absorptive capacity, and international sales performance in the international B2B setting: Conceptual framework and research propositions’, International Business Review, 23(6), pp.1193-1202.

Jianhong Chen and Nadkarni, S. (2017) ‘It’s about Time! CEOs’ Temporal Dispositions, Temporal Leadership, and Corporate Entrepreneurship’, Administrative Science Quarterly, 62(1), pp. 31–66. doi: 10.1177/0001839216663504.

Kirsner. S. (2018) ‘Why There’s No Such Thing as A Corporate Entrepreneur’, Harvard Business Review, Pp. 1-4.

Provasnek, A. K. et al. (2017) ‘Sustainable Corporate Entrepreneurship: Performance and Strategies Toward Innovation’, Business Strategy & the Environment (John Wiley & Sons, Inc), 26(4), p. 521.

Vahdet Hüseyin Günay and Ahu Tuğba Karabulut (2018) ‘The Effect of the Corporate Entrepreneurshıp on the Company Performance: A Study in the Servıce Sector’, International Journal of Commerce and Finance, Vol 4, Iss 1, Pp 121-133 (2018), (1), p. 121.