Chapter 2
Entrepreneurial Intentions
and
Corporate
Hisrich
Entrepreneurship
Peters
McGraw-Hill/Irwin Copyright © 2010 by The McGraw-Hill Companies, Inc. All rights reserved. Shepherd
Managerial Versus Entrepreneurial
Decision Making
Entrepreneurial management is distinct
from traditional management in terms of:
Strategic orientation.
Commitment to opportunity.
Commitment of resources.
Control of resources.
Management structure.
Reward philosophy.
Growth orientation.
Entrepreneurial culture.
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Table 2.1 – Distinguishing Entrepreneurially
from Traditionally Managed Firms
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Managerial Versus Entrepreneurial
Decision Making
Strategic orientation- factors that are
inputs into the formulation of the firm’s
strategy
Entrepreneurial Traditional managment
-Driven by the presence of -To use resources efficiently
opportunities for new entry -Type and resources the firm
-Acquiring necessary has represent a key starting
resources is secondary point for future
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Managerial Versus Entrepreneurial
Decision Making
Commitment to opportunity
Entrepreneurial Traditional managment
-Committed to take action on -Place emphasis on
potential opportunities information that derived from
-Can pursue opportunity data collection & analysis eg:
rapidly- making the most return on resources deployed
‘window of opportunity’ -Large initial investment will
-Able to withdraw resources be made once pursuing
rapidly if find it is not the right opportunity with intention to
opportunity- minimize losses stay longer
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Managerial Versus Entrepreneurial
Decision Making
Commitment to resources
Entrepreneurial Traditional managment
-Focus on minimize resources -Use resources at large scale
required to pursue particular -Based on past events
opportunity -Not easily reversed
-Put small amt of resources
each step- small risk
-Can change direction rapidly
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Managerial Versus Entrepreneurial
Decision Making
Control of resources
Entrepreneurial Traditional managment
-Less concerned abour -Focus on ownership of
ownership of resources resources & accumulation of
-Concerned more about further resources
having access to other;s
resources
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Managerial Versus Entrepreneurial
Decision Making
Management structure
Entrepreneurial Traditional managment
-Few layers of bureaucracy -Structure well suited with
between top mgt & customer internal efficiencies of
-Multiple informal controlling resources
communication channels -Formalized hierarchy
-Able to communicate & take -Higly routinized work
action faster -Layers of middle managment
-More structured both for
internal and external networks
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Managerial Versus Entrepreneurial
Decision Making
Reward philisophy
Entrepreneurial Traditional managment
-Focsed on pursuing -Managed rewards based on
opportunities for new entry responsibilities that is
that represent new value determined by amt of
-Compensates employees resources each employee
based on the contibution controls
toward discovery/ generation
and exploitation of opportunity
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Managerial Versus Entrepreneurial
Decision Making
Growth orientation
Entrepreneurial Traditional managment
-Desire to expand firm size -Prefer slow and steady
rapidly growth- manageable growth
Entrepreneurial culture
Entrepreneurial Traditional managment
-Encourage employees to -Intersted in ideas that
generate ideas, experiment & revolve around currently
creative task controlled resources- limit the
scope of opportunities
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Managerial Versus Entrepreneurial
Decision Making (cont.)
Causes for Interest in Corporate
Entrepreneurship
Increasing interest in “doing your own thing”
and doing it on one’s terms.
New search for meaning and impatience has
caused more discontent in structured
organizations.
Organizations are encouraging corporate
entrepreneurship i.e. stimulating, and
capitalizing on, employees who think that
something can be done differently and better.
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Managerial Versus Entrepreneurial
Decision Making (cont.)
Corporate entrepreneurship is most strongly
reflected in the following endeavors:
New business venturing (corporate venturing)
- The creation of a new business within an existing
organization- by redefine company’s product, develop
new mkt or form formally autonomous/semiautonomous
units/firm
Innovativeness
- Product and service innovation, with emphasis on
development and innovation in technology.
- Include new product dev, prod. Improvement, new
production methods and procedures
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Managerial Versus Entrepreneurial
Decision Making (cont.)
Self-renewal
-Transformation through renewal of the key ideas on
which an organization is built.
- Includes a redefination of buss. Concept, reorganization,
introduction of systemwide changes to increase
innovation
Proactiveness
- Includes initiative, risk taking, competitive
aggressiveness, and boldness.
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Table 2.3 - Characteristics of an
Entrepreneurial Environment
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Table 2.4 - Leadership Characteristics
of a Corporate Entrepreneur
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