Research Article: 2021 Vol: 25 Issue: 1S
Sanath Divakara, University of Kelaniya
H.A.K.N.S. Surangi, University of Kelaniya
Intrapreneurship, Small and Medium-Scale Enterprises, Organizational Growth, Qualitative Approaches and Narrative Studies.
Business environment of the manufacturing organizations has become increasingly complex, dynamic and uncertain as a consequence of various constraints. Thus, manufacturing industries are urged to increase their flexibilities to maintain competitiveness in the market. The affirmation of intrapreneurship has become one of the essential facts that in achieving higher adaptability and competitiveness in the growth. This study investigates a holistic view of the concept of intrapreneurship focused on purpose, influences, dimensions, and contribution related to the small and medium scale manufacturing industry in Sri Lanka. Narrative inquiry of the qualitative approach concern to interaction, continuity, and situation were framed on collecting data from the echelons. Fifteen echelons from the ISO certified manufacturing and award-winning organizations were purposively selected for the interviews. NVivo 12 used to organize the data in analysis and derived themes based on the four research questions. A model was constructed as the final outcome with related to the study findings. The study findings affirmed the relationship between intrapreneurship and entrepreneurship to stimulate organizational growth and the dyadic effect with related to thrift, productivity and efficiency of internal operation of the organizations. Research contribution primarily enabled three areas, development of entrepreneurial management system, development of echelons focusing intrapreneurship skills and socioeconomic growth.
The concept of intrapreneurship has become popular in the development of business industries over the last four decades. Intrapreneurship initiated from the American business lexicon, and there has been a growing interest in the use of "intrapreneurship" in terms of enhancing employee innovative capabilities and the creation of new ventures as a success factor for the organizational (Kuratko, Montagno & Hornsby, 1990). The model constructed of the intrapreneurship has shown reasonably good convergent and discriminant validly as well as nomological validity in terms of a positive relationship to the organizational & environmental antecedents (Antoncic & Hisrich, 2001). The term “intrapreneurship” was introduced by (Gifford & Elizebeth, 1978) and has given a trigger to industry performance during the last four decades (Baruah & Ward, 2014). The scholars such are (Pinchot, 1985; Guth & Ginsberg, 1990; Zahra & Covin, 1995; Antoncic & Hisrich, 2003; Cadar & Badulescu, 2015) exploded the entrepreneurial dynamics within the organization and conceptualized it as intrapreneurship. Intrapreneurs are made not born (Pinchot & Pellman, 1999). Intrapreneurs are talented and empowered employees who enable corporations to transform strategically and change the direction of their businesses (Haller, 2015). Intrapreneurs emerge within the organization to undertake new business activities (Bosma, Stam & Wennekersf, 2010). Eight dimensions such as new ventures, new businesses, product/ service innovativeness, process innovativeness, self-renewal, risk-taking, proactiveness and competitive aggressiveness have been explored as intrapreneurial dimensions (Antoncic & Hisrich, 2003). High competitiveness among small and medium scale enterprises sector enables embarkation on new concepts, new theories vitally for sustainable development of the industry. Researchers have profound for various types of remedial solutions in the development of intrapreneurship (Chandrakumara, Zoysa & Manawaduge, 2011; Kaluarachchi, 2015; Wickramaratne, Kiminami & Yagi1, 2014). Thus, the concept of intrapreneurship has novel approach to the development of SMEs manufacturing in Sri Lanka.
However, Small and Medium Scale Enterprises (SMEs) in Sri Lankan have shown a slow performance as against the large-scale enterprises in the national economy due to various barriers of internal and external environments (Vijayakumar, 2013). Some of themes such as lack of innovation, financial unrest, lack of knowledge, lack of infrastructural facilities is related to internal environmental factors which caused retardation in the industry growth of SMEs in Sri Lanka. SME contribution to the GDP of Sri Lanka is around 52% in 2017 (CBSL, 2018). SME manufacturing has become significant in GDP growth and competitiveness in the market; therefore, many governments and non-government organizations were involved in their development. Some of the deficiencies can be identified as lack of entrepreneurial and intrapreneurial skills as one of the major contributing factors for the retardation of the organizational growth of SMEs in Sri Lanka (Fairoz, Hirobumi & Tanaka, 2010). Scholars have revealed a relationship between intrapreneurship and the firm's growth (Antoncic & Hisrich, 2001), however, there is an aggressive dearth in research in related to the context. The in-depth analysis and categorization of constraints that prevail in the small and medium-scale enterprises related to intrapreneurship explain the importance of implementation of the concept of intrapreneurship to business developments (Divakara, Semasinghe & Surangi, 2019). The previous researches focused on a quantitative approach; hence the findings become one-sided. The underlying influences of intrapreneurship development and organizational growth in small and medium scale enterprises have become an essential requirement as a part of economic and social development. Therefore, conducting a comprehensive study on the concept and how it can be adapted to the small and medium scale manufacturing industry has become significant in today's context. The prime purpose of the study is to explore the social, cognitive and psychological contributions to the development of intrapreneurship skills as a core share of the competitive advantage in developing the manufacturing industry of the small and medium scale manufacturing organizations in Sri Lanka.
This article draws four research questions on intrapreneurship development as find the answers to the research objectives.
• What are the antecedents' that influence the development of intrapreneurship in the small and medium scale manufacturing organization?
• Why is intrapreneurship imperative in the small & medium scale manufacturing enterprises?
• What are the intrapreneurial dimensions involved in the development of small and medium-scale manufacturing enterprises?
• How does intrapreneurship involve in the growth of small and medium-scale manufacturing enterprises in Sri Lanka?
The concept of intrapreneurship is a renewing concept and the first appearance was in 1978 intending to improve organizational performance by increasing opportunities in a more complex competitive environment (Molina & Callahan, 2009). Bull & Willard (1993) proposed the adoption of Schumpeter's definition of "entrepreneur" and economic outcomes, approach to the entrepreneurship studies as a general term of the identification of traits and characteristics. The concept of intrapreneurship, inner entrepreneurship, and corporate entrepreneurship are terms used frequently as synonyms in the presence of dynamics of entrepreneurship in large companies (Delic, Alibegovic & Mešanovic, 2016). There is no universal definition to the intrapreneurship yet being developed (Delic et al., 2016; Sharma & Chrisman, 1999), therefore, the line of study is yet under construction seeking a proper conceptual frame. Some of the definitions of the concept intrapreneurship are as follows, "Intrapreneurship demands a unique blend of managerial and entrepreneurial skill to achieve organizational innovation, growth and competitive advantage" (Pinchot, 1985). The concept of intrapreneurship has defined as, "Intrapreneur" is the person who focuses on innovation and creativity and who transforms a dream or an idea into a profitable venture by operating within the organizational environment (Nicolaidis & Kosta, 2011). The American Heritage Dictionary added the word intrapreneurship to its dictionary as with the following definition, A person within a large corporation who take direct responsibility for turning an idea into a profitable finished product through assertive risk-taking and innovation (Baruah & Ward, 2014). The turning process of the development of the new idea into the project, along with the changing mindset, means a transformation of "scientific to intrapreneurial " is individual paramount (Kirschbaum, 2015). (Sharma & Chrisman, 1999) explained that there is a striking lack of consistency in the definition of intrapreneurship. When having broader definitions, it tends to generate internal inconsistency and difficulty in research (Amo, 2010). Intrapreneurship (Entrepreneurs within the organization) have been identified as an important element in the organizational and economic development (Antoncic & Hisrich, 2001). Working as intrapreneurs means work in small and agile, support the potential of the small initiative to tackle process changes (Hensen, Schoenbeck, Buescher & Prexl, 2016). Intrapreneurs are dreamers who take hands-on responsibility for creating innovation of any kind within an organization (Pinchot, 1985). The supportive organizational environment has identified as internal climate factors; on the other hand, it was described as a facilitator for an organization to spur intrapreneurship activity (Antoncic & Hisrich, 2001; Kuratko, 2006; Kuratko et al., 1990; Zahra & Covin, 1995). Human capital includes individual knowledge, ideas, which encourage and enable organizational innovativeness. Simultaneously human capital and organizational support create a synergetic effect (Alpkan, Bulut, Gunday, Ulusoy & Kilic, 2010). The intrapreneurship evolution performed under three structures rejuvenation, reinventing, or revitalizing is given more attention to entrepreneurial roots by (Baden, Fuller & Volberda, 1997). Intrapreneurship is a concern with individual activities that thrive firms performance (Kazanjian, Drazin & Glynn, 2002). Intrapreneurship is concentrated on an individual level as a bottom-up process of the individual employees (Bosma et al., 2010; Gapp & Fisher, 2007). An intrapreneur is about bottom-up, proactive, work-related initiatives of employees of the organization (Moriano, Molero, Topa & Lévy Mangin, 2011). An intrapreneurship is innovation behavior as a core filed among employees in the organization, which is an autonomous strategic behavior to uplift organizational performance (Amo, 2010).
The identification of perceptual and cognitive factors encourages intrapreneurs to adapt to discover and exploit opportunities within the organization (Cools & Broeck, 2008). The managers' cognitive bases make them analyze the events and the data and come to a conclusion where they stand and what happened as causality (Camelo, Fernández, Navarro & Ginel, 2011). Psychological characteristics are difficult to measure, based on upper echelon theory, characteristics of senior managers identified as demographic characteristics were observed (Camelo et al., 2011). That has been taken as a surrogate for the cognitive base of the managers (Hambrick & Mason, 1984). Although the upper echelon theory has been used to explain the strategic decision making and behaviors of the company management, that has equally valid for explaining the concept of intrapreneurial behavior and its relationship through the innovation (Ordaz et al., 2011). Three basic components of competencies cognitive, functional, and behavioral are related to the model identified as intrapreneurial competencies (Halabí, Esquivel & Siles, 2017). The latest update of the upper echelon theory has explained the influence of situational antecedents on the upper echelon characteristics such as environmental factors and organizational factors. All individual factors' influence on strategic choice is introduced as echelon characteristics. The intrapreneur studies were rooted from the upper echelon theory (Hambrick, 2007; Hambrick & Mason, 1984), the theory explained the characteristics and dispositions of the firm as the most powerful actors (Jahanshahi, Nawaser & Brem, 2018). (Jahanshahi et al., 2018) confirmed that both psychological dispositions of cultural intelligence and ambiguity tolerance of top management shape the intrapreneurship strategy in the SME. Therefore the theory of upper echelon is the most appropriate construction for this study focus to middle-level managers in the organizations.
Three dimensions, venturing, innovation, and strategic renewal, was proposed through an examination of the association between a firm's external environments (Zahra, 1993). New venture formation (incubator entrepreneurship), product service innovation, and process innovation were identified as the three most pronounced elements of the organization's entrepreneurial activities (Mokaya, 2012). The clarification of four dimensions of intrapreneurship, new business or venture creation, innovativeness, self- renewal, and proactiveness was asserted (Antoncic & Hisrich, 2001). Four dimensions, new business venturing, product/service innovation, process/technology, self-renewal, were considered as a building block of intrapreneurship (Antoncic & Antoncic, 2011). Five dimensions of new business venturing, innovativeness, self-renewal, proactiveness, and risk-taking were taken into consideration in the study of intrapreneurship (Mokaya, 2012). Autonomy, risk-taking, innovativeness, proactiveness, and competitive aggressiveness were explored as an intrapreneurial orientation (Lumpkin & Dess, 1996). The author highlighted that new entry which is called the first mover as an attribute to the entrepreneurship. Six dimensions as a new business/venture, innovativeness, self- renewal, risk-taking, proactiveness, and competitive aggressiveness introduced the latter (Antoncic & Hisrich, 2003). (Felício, Rodrigues & Caldeirinha, 2012) found six dimensions of innovation, risk/uncertainty, risk/ challenges, proactiveness, autonomy, and competitive energy. The eight distinctive dimensions new ventures, new businesses, product service innovativeness, self-renewal, risk-taking proactiveness, and competitive aggressiveness as a multidimensional concept found (Antoncic & Hisrich, 2003). However, the eight dimensions have been synthesized into six dimensions on simplification business venturing and innovativeness. (Ağca, Topal & Kaya, 2009) assert that a positive relationship with multidimensional innovativeness, renewal, new business venturing, risk-taking and proactiveness as a model to intrapreneurship examination in the field of research antecedent and consequences of intrapreneurship (Kenney & Mujtaba, 2007).
Social constructionist approach was adapted in this study to construct organizational, individual and environmental influences to the corporate entrepreneurship. (Hornsby, kuratko & Zahra, 2002; Zahra et al., 1999) highlighted the importance for qualitative research and better understating of the organizational culture and context. In line to a criterion based on theory of upper echelon (Hambrick & Mason, 1984) and ISO 9001 2015 (International Standard Organization) adapting to the purposive sampling the organizations and echelons were selected. Key informant involvement was imperative in the identification of intrapreneurships in their organizations. Two interviews were conducted for each respondent completing thirty in-depth interviews in their locations. The sample organizations were located in four provinces in the country and the data collection process was continued for a period of five to six months followed to a tough time. Ethical practices on personal, research, intellectual, professional and corporate high concerned during in the study (Shaw, 2008). However, the interview process was became lengthy as a result of unfamiliarity of the concepts by the discussants. A pilot study was conducted as feasibility study that comprises a miniature version of anticipated research (Kim, 2010). Heterogeneity and homogeneity both well managed in selecting appropriate intrapreneur from different industries, age and genders, educational background etc..
The theory of experience explained (Clandinin, 2016), three dimensions of the metaphoric narrative inquiry space, a space drawn upon Dewey's criterion, interaction (personal and social) and continuity (past, present and future) and notion of situation in the in-depth interview. Narratives are the suitable methodology in this study concern to the exploring experiences, knowledge in relation to the corporate entrepreneurship. Narratives analysis associating NVivo 12 software was adapted in the analysis of transcripts in this in the research. The analysis revealed proper outcome of the research as target objective in the research.
Four factors purpose, dimensions, influence and contribution were derived based on previous literature and four research questions. Transcripts exemplified various imperative themes and sub-themes as depicted in the diagram below. A model of intrapreneurship in figure 1 was developing for small and medium scale manufacturing sector using all findings that enabled in the development of intrapreneurship. Figure 1 depicted the research findings as follows,
Purpose of Intrapreneurship in SMEs (Why)
Intrapreneur is described as entrepreneur within the organizations and a vital element of economic and organizational growth (Nicolaidis & Kosta, 2011). The study investigate the nature of the organization such as background, management support, strategic directives, intrapreneurship, and entrepreneurship relationship and how operational excellence was influenced by the work environment and types of organizational culture and leadership etc.
The respondents Sadepa, Bandula were senior managers and they explained the experiences in working in a medium-scale organization as below. They highlighted that the level of the organizational performance prevailed at the time of their joining to the organization.
"There was a good market but not enough production output in the factory, no systems, no procedures. I had to restructure the whole process. I change the organizational structure. List out problems hindering to the production flow and addressed one by one" - Sadepa
"Before my joining Managing Director was handling all the sales and production, there was no basis or analysis refers to the decision. There were sales but those were not quality sales, he did not have good knowledge in managing the operation. "- Bandula
Sub-themes derived in the study that stimulate the organizational growth such are relationship between entrepreneurship and intrapreneurship and the effect of combination are shown in figure 1. The factors loyalty, trust and authority delegation were derived under the themes of relationship and bricolage and award winning derived under the theme of dyadic effect. That exemplified by the interview of Ranga's as follows,
"The owners of the organization also very good they are giving me very good support, they are also from ordinary level families so they know our requirements. They started at the lowest stage and grew to this level. That is where the loyalty built and we all respect them very well."
Bandula's elicitation indicated about how entrepreneur monitored the sales achievement. The entrepreneur just monitored the achievement in an ad-hoc manner. There was no proper analysis and strategic direction on planning and achieving sales targets. It further depicts a lack of focus on the sales in this company as a fundamental issue in the manipulation of sales targets. Proper intrapreneurship picks the issues as a third party consideration; Bandula attended first to solve this issues in the sales, which is identified to attend urgently giving first priority.
All the respondents explained before and after situation (Clandinin, 2016) of their organizations and how the revitalization effected in their involvement as intrapreneurship. However, the elicitation exemplified an achievement only as far as a concern to their contributions. The stories explained more achievements with interesting stories; those stories triggered to have a better outcome for the organization. In most occasions, entrepreneurship was highlighted in the leadership since intrapreneurship became a hidden factor. That was exemplified by Bandula's explanations. It was further exhumed the support and the relationship of the entrepreneurs as well. The themes found up authority delegation and building of trust on intrapreneurship stimulated the organizational performance in all the aspects. The fact, that it is understood that there was a better relationship between entrepreneurship and intrapreneurship in all these organization enabled sustainable growth.
Influences to the Intrapreneurship Development (What)
Three influential antecedents, organizational, individual and environmental on intrapreneurship development have been explored in relation to the manufacturing industry (Divakara & Madurapperuma, 2017; Guerrero & Legazkue, 2013). Two antecedents' model giving organizational and environmental factors were introduced as a direct effect on intrapreneurship development and organizational growth (Antoncic & Hisrich, 2001). The proven factors discovered are dynamism, technological opportunities, industrial growth demand for the new products and favorability of change under environment and communication, formal control, environmental scanning, organizational support, and competition-related values and related personal values under organizational antecedents (Antoncic, 2007). (Antoncic, 2007) further explained environmental munificent as another antecedent for the intrapreneurship. There were few studies were conducted searching on intrapreneurial influences (Chandrakumara et al., 2011; Kaluarachchi, 2015; Weerakoon, 2014; Wickramaratne et al., 2014) related to the context. The study extracts an overall understanding of influences of intrapreneurship, focusing on the small and medium scale organization in Sri Lanka. The analysis search to deep down for the exploration of significant factors related to the development of intrapreneurship.
The factors learning organization, organizational culture, management support, work systems were identified as the influences of organization in the development of intrapreneurship. All the respondents have many years of experience that led to a high quality of entrepreneurial skills. All the respondents had an average of more than twenty years of experience working in single or multiple industries. More experiences mean more learned by works. That was the factor that enabled to be a definite requirement of their stability on retention. However, a unique feature found was working with one owner and relationship with the owner of the organization. Following are examples of the Sunil's experiences,
“I have been working in this organization for more than 32 years. I learned all here and worked for this organization and gradually improved the organization. All were learned through experiences trial and error".
He had involved in many innovative performances and venturing in the organization over the period. He was working with the owner from the inception, and the owner had looked after him throughout. Thus he became the major player as a tester of indigenous medicine.
Similarly, Lochana was not an electrical engineer she had more than 15 years of experience in the electrical automation industry. She worked in many organizations starting as a sales manager, and she had become expert in that field automation engineering, she elicited the experiences as follows,
"I think one tuning point is selecting me this industrial automation field that was unexpected but when I come to that field It was a very interesting thing for me in working with customers, and I got a chance to learned engineering technology ".
Mahen had a science degree, and he had been working as an Assistant Quality Assurance Manager. He had no experience in the food manufacturing system and handling quality-related works in the organization. He worked hard and developed his skills through learning all related matters as per the story elicited below,
"I got high development as personal fulfillment. I learned a lot and got good experience also after joining this company. That gave me a better motivation to do anything in the industry. I underwent all the training relevant to ISO standards external and internal".
The capabilities of learning are the intrinsic factor that enables them to be in the current positions. The organizational support by allowing an improvement their skills was the particular highlights in this regard and in return organizational growth as well.
Five broad types of internal entrepreneurship which is so called intrapreneurship that had been proposed as administrative, opportunistic, imitative, acquisitive and incubative by (Kuratko et al., 1990; Schollhammer, 1982). Intrapreneurs recognized opportunities and reconfigure resources to exploit the opportunities (Rigtering & Weitzel, 2013). Opportunities for organizational development are within the organizational environment. Intrapreneurship has endogenous skill in grabbing the correct opportunities and implementation in the aspect of economic and social. Bricolages, frugality, improvise, illuminations are tools and techniques involved in intrapreneurs' opportunity explorations. Jagath's exemplified as follows,
"I have the autonomy to take productive decisions; there are opportunities within the organizations, but you have to identify those and utilize thinking in an economical way. There are system and procedures to follow as organizations to carry out operational and functional work", Similar Explanation Found in Sadepa's
"I studied the process; there were many hidden losses that were identified and tuned those into opportunities and improved productivity and quality. Workers also helped me a lot in this and finally, we achieved the targets. The ownership was highly satisfied with my work."
There were two types of opportunities discussed by the respondents as internal and external. Sadepa and Jagath explained about internal opportunities those involved in improving internal capabilities by the implementation productivity, quality in the process. Intrapreneurs are capable of identifying and turnout opportunities with their skills, knowledge, and experiences as the story of Jagath and Sadepa.
The entrepreneur is the creator of a new business that involves the nexus of two phenomena that is the presence of lucrative opportunities and the presence of enterprising individuals (Shane & Venkataraman, 2000). Intrapreneurs are entrepreneurs within the organization, and they are important for economic and organizational development by definition (Antoncic & Hisrich, 2001). The study exemplified that as the vision hidden in the minds of intrapreneurship to become an entrepreneurship
Dilhan's explanation clearly explored out as follows,
"I have an idea of doing my own business. That is to manufacture pet bottles within the next few years."
Anushka's also had the same feeling to have her own manufacturing, intrapreneurship is a risk avers character and over the time they plan a stable background not to fail their start ups.
" I want to do my own business and, my parents are already engaged in small scale production. I have an idea to start manufacturing a product because there is machinery".
The stories explored different types of attributes that were strengthened and weakened by their knowledge and experiences. Jagath had twenty years of experience and already started his own organization for consultation. Anushka had fourteen years of experiences she was about to start her own business, and Dilhan had ten years of experience he was planning to create his own business in ten years. All were capable and dedicated to their work. The constraint was the risk of starting a business. They all were thinking to start their own manufacturing-related business with their experiences. Similarly, Neal and Bandula also were working in the upper category; they also have planned to start their own manufacturing business.
Some of the new findings related to the context are personal branding, the future mind of entrepreneurship, administrative capabilities, multidisciplinary work capacity target follower, prioritization of personal activities, etc. The antecedents re-exploded are visionary personality; learn by work, individual networks, self-efficacy, self-satisfaction, updating knowledge, etc. All the echelons are not intrapreneurs. The prevalence of intrapreneurs are less than 5% of employees (Bosma et al., 2010). Internal environment of the organization has being the defining factor of intrapreneurship (Antoncic & Hisrich, 2001). The inherent factors in the context not revealed from the literature that are important to entrepreneurship to understand in application to the development of intrapreneurship. One of the cultural factors of power distances is the main inherent factor that was an inhibitor to intrapreneurship development. The study exploration discussed synonyms of power distance throughout the analysis refer to the elicitations of interviews. Referencing study finding there was very minimal power distance in the sample organizations that was one of the main stimulating factors in intrapreneurship development. The other new indicators found in this research were good manufacturing and ethical practices, incentives, and objective-driven management system, and transformational leadership.
The literature review explained comprehensively about the main themes from the previous researchers. Regardless of the previous finding, this research analysis was conducted to explore influences focused the context. Organizational influences were discussed vividly as it showed there are many contributing factors to the intrapreneurship development. The entrepreneur is the leader of the Small and medium scale organizations involved in all the functional activities of the businesses. Hence, entrepreneurship contribution mainly influences in the development of intrapreneurship in concern to the organizational factors.
One of the important objectives of an organization is to move forward for its highest possible performance in a sustainable manner. Development of intrapreneurship is a competitive factor for an organization; thus, leaning organization plays an important role in developing intrapreneurship (Alipour, Idris, Ismail, Uli & Karimi, 2011). The entrepreneurship organizations start at a very small level and gradually expand their process capabilities to become small, medium and large. Organizational learning involves and entrepreneurship and intrapreneurship as an essential part of the development. The examples of stories explained how organizational learning contributed in the growth in the sample organizations. The extract of Bandula's is as follows,
"We give training to all people specially for sales representatives and production, quality, stores etc. Newly recruited employees always undergo orientation programs"
Organizations provide two types of training such as external and internal. The extract of Sadepa's was somewhat comprehensive and the organization was concerned more in arranging training and monitoring the performance through fulfillment of objectives,
"We have good relationships with outside educational institutes and always update knowledge of our employees. I arrange industrial training for all my subordinates to update their knowledge. That makes use to process innovation at a very effective level"
Shanaka concentrated on internal training conducting and, the organization had given excellent support and opportunity to grow the employees. Shanaka had won many quality circle awards by leading the teams for achieving high productivity in the process.
"I am conducting a training program on improving productivity knowledge... We got advice and training from the National Productivity center for the required knowledge. The organization provided a good background on learning and improvement."
The organization where Shanaka works, had a separate event called "Ape Wedikawa" focusing on the development of soft skills of employees, and that was a very successful event. Learning had been identified as a fundamental aspect of entrepreneurship development, and behavior focused on to acquiring knowledge, business knowledge, attitude and habits (Gibb, 2016).
The factors embedded with the organizational culture are values, norms, beliefs that exist in the organization and, how it was created through the leadership styles. Intrapreneurship was initiated and retained through the leadership qualities. The organizations are in the small and medium scale operation led by the ownerships. All the organizations existed quite a long period of time in society. The important factor of the existence was having maintained a better culture. Renuka's story is about the organizational culture,
"Culture of this organization is different, No labor unions. Lots of villages are working here. Long experience employees. It is difficult to change them to for wrong things. Managing Director knows personally each and every one, he has good network with them".
Two themes were derived from the analysis as effect of the cultural in the manufacturing organizations as values and power distance as influences to the intrapreneurship for the theme of organizational influences.
The study confirmed the validity of those factors in the Sri Lanka context and extracted more as new themes. The contextual influences broadly divided into internal factors (Organizational structures, culture, system) and external factors as Industry globalization, product/ market, life cycle, stage and government regulations (Zahra, 1991). External factors Dynamism, Technological opportunities, Industry growth, Changing customer demand, Unfavorability of change and competitive rivalry had been associated with corporate entrepreneurship or intrapreneurship. Environmental influencing factors are not so significant in intrapreneurship development compared to other factors of individual and organizational in small and medium scale organizations. Following are the exploration as environmental factors,
Three themes market demand, technological changes, and competitive rivalry were evolved in relation to the environmental factors of intrapreneurship in the study. The factors competitive rivalry was found out as new to the concept of intrapreneurship.
All the organizations selected in the study were in their highest level of growth stages as a result of strategic renewal or natural growth. The growth stage signifies a better market share for their products and hence internal competition to supply the required product on time. Market demand also encourages intrapreneurship on creating new improvements and products as a strategy of pull demand (Antoncic, 2007). Intrapreneurs' attention is on how to innovate production system to sustain the market demand under a certain pressure. The respondents exemplified that they have an outstanding market, and accordingly, the production had been planned. Below are depicted the transcription of Bandula,
"This month (May 2019), we had planned 30 million of sales. Anyhow we achieve 29 million there was a small amount as different it was around 1.5 million. We had enough orders; we have good potential and market, the issue is we have to manage with the available cadre."
Bandula said that they could not achieve the sales targets in May 2019 due to issues in production. Otherwise, there was a good market, and they were planning to increase the capacity to achieve the required demand. Following are given the story of Sadepa on market demand,
"Very good: In my first year 2014, I got the Managing Director award as the best performance. The main reason was there was a good market outside, but not enough production".
Sadepa also indicated a similar story of Bandula. There was a good demand which means that it created a rivalry inside the manufacturing process. More demand stimulates intrapreneurship development through more creativity and innovations in searching for solutions. Following are given Lochana's story also confirmed about the market demand,
"Actually, there is growth if we take this period there are lots of problems in the market, many organizations straggling in the market. But we have a good market."
All the respondents explained that there was a good market, and that made a rivalry in the manufacturing process stimulating a pull strategy in the development in intrapreneurship skills in order to supply those services on time.
Environmental munificence stimulates intrapreneurship for venturing and renewal(Zahra, 1993). Market demand, technological changes, rivalry, and competencies can be identified as themes in the study. Market demand prevailed under the present trend in business is a highly volatile and competitive advantage is essential to address in manufacturing organizations. Technology change and updates also become vulnerable factors in the manufacturing industry. Hence the market demand and technology play a huge impact and involvement of intrapreneurs.
Intrapreneurial Dimensions in the Growth of SME’s (What & How)
The previous explanations were on purpose and influences of the intrapreneurship in small and medium scale manufacturing organizations refer to the first and second research questions. This section was organized with the analysis of two research questions of what are the intrapreneurial dimensions and how it involved in organizational performances. The first part of the analysis explained intrapreneurial dimensions and the applications involved within the manufacturing organizations. Intrapreneurship fosters the organizational growth (Rule and Irwin, 1988). The second part explains the effect of intrapreneurial dimensional on organizational growth. Stories capsulate the imbued knowledge of the organizations enabling in the development of intrapreneurship.
The phenomenon of intrapreneurship is described using various dimensions. Three dimensions of the intrapreneurship have found as business venturing, innovation, strategic renewal (Guth & Ginsberg, 1990; Zahra, 1993). This study conducted to search dimensions those are the most relevant to the context and concept of intrapreneurship. The respondents were in a different manufacturing organization and vested with deferent responsibilities by the organization; therefore each can be veteran for one discipline as undermentioned.
The three dimensions of strategic renewal, innovation, and venturing were the factors discussed in this section, those visualized as the active implementation in all the manufacturing SMEs that led to growth. The bottom-up strategy was explored everywhere in the elicitations, that was the main factor differentiate intrapreneurship and corporate entrepreneurship (Bosma et al., 2010; Gapp & Fisher, 2007). The findings explained creativity and innovation activities within echelons as bottom-up processes as a result of the initiation of brainstorming sessions, kaizen suggestion schemes to promote employees towards bottom-up approaches. The sub-themes reanimation was highlighted as the bottom-up approach. Process rejuvenation found all the cases as streamlining process activities, restructuring involved in some occasions as strategic directives. The continuous improvement had been adapted to all the organizations' mesh, chemical, electrical equipment manufacturing as a basic tool for the innovation apart from a sustainable innovation strategy. External venturing was not significant, but internal venturing as the introduction of new business through product innovation was found to be significant in this study.
Intrapreneurship provides strategic choice (Hambrick, 2007) as options to refine the business model aligning the growth considered to the change of customer needs and expectation and that enabled a competitive advantage to the organization (Sahra & Pearce, 1994). The (Greiner's life cycle theory, 1972), (Hoy, 2006) strategic renewal emerge after the maturity stage as an intrapreneurial strategy; otherwise, there can be a decline stage. Strategic renewal has been defined by dividing into two parts, such as strategy and renewal (Agarwal & Helfat, 2009). Thus intrapreneurs were attributed as the expert in strategic renewal for revitalizing manufacturing organizations (Divakara, 2019). Intrapreneurs participation is vital factor in the process of strategic renewal on maintaining the organizational dynamism.
Hambrick & Mason (1984) suggested that executives who have spent their entire experiences primarily in one organization are more prone to innovate an existing product and market rather than new venture. The continuous improvement process is one of the strategies implemented by many organizations as incremental innovation which is adapting to a minor improvement to the existing product, process or service (Engen & Holen, 2014). All employees have opportunities to involve in continuous improvement in many ways. Some of the common activities are individual suggestions, illuminations, improvising, etc. Intrapreneurs always have the habit of innovating within the innovative continuum incremental to disruptive. It was observed many of the organizations were following continues improvements, suggestion schemes and small group activities. Following is explained Jagath's connotation of how innovative culture had been developed and maintained in the paper production industry,
"I joint this company as an engineer to the plant situated in Colombo. I did many innovative activities in the Colombo plant. There should be autonomy to work and support.".
The story explained how innovative culture was identified by the organization and facilitated the intrapreneurship. It signifies a considerable autonomy had been provided to enabling innovativeness to the relevant employee. In addition to that, there were another two antecedents' authority and rewards. In simple, those are some of the factors influence intrapreneurs to perform innovation. Bandula had organized a formal way of collecting innovative suggestions from the employees and following is given the outcomes,
The growth contribution by intrapreneurship was profound in the integration of intrapreneurship within the organization. The organization type focused in this study was a small and medium scale which is with very low interest on investment for vertical and horizontal integrations or mergers and acquisitions. The factors business size (smaller grow more), age (the younger grow more), business independent are contributing to the growth (Davidsson, Kirchhoff, Hatemi & Gustavsson, 2002). It was constructed related knowledge using stores of the respondents on growth behavior as a contribution of intrapreneurship. The exploration was categorized into three subcategories operational excellence, financial and social growth for deep examinations. The important factor that was observed in all the organizations were found in growing stage refer to the life Greiner's life cycle theory 1972 (Hoy, 2006).
Sadeepa explained how the growth was before he joint to the organization.
"Growth is in all areas such as Economical, Financial, Social, and spiritual. There is huge growth in financial terms during the last five years. There was an expansion in product portfolio which is can be seen with the no of the product we sell now. Market share has been grown; at the time".
Growth is vitally merged with all the function of marketing, production, finance, quality, human resources, and supply chain and technology to maintain the essential requirement of economic and social growth. The trapreneurial activities relevant to the functions were expressed in manufacturing industries. Following are the three factors significantly profound in this study concerned to the organizational growth.
Neal was in the marketing section of Chemical manufacturing organization, and he expressed his feeling about the growth of the organization is as follows,
"The growth was around ten-fifteen products; those are new markets we entered with our products, those markets we did not have previously. Because of that, our market increased due to entering our products to there".
The study examined two areas in the study aimed at searching answers for the research questions. The study context focused on small and medium scale manufacturing organizations in Sri Lanka; hence the findings became specific. Manufacturing organizations are highly dynamic due to high competition in the market everywhere in the world. Thus there should be a high involvement in intrapreneurship in a manufacturing organization that was visualized in this study. The performance of the intrapreneurship was always behind the screen within the organization that was not visible as corporate entrepreneurship in the entrepreneurship centered organizations like small and medium scale organizations. However, there was a significant association between intrapreneurial dimensions and organizational growth in relation to the operational activates in manufacturing SMEs in Sri Lanka, leading to competitive advantage.
The stories of intrapreneurship within the manufacturing sector have shown internal functions such as operational excellence, production growth, and sales growth, etc. Intrapreneurial behaviors of echelons exploit organizations from their strategic initiations blending knowledge and experiences. The strategic approaches of the economics of scale and scope, cost reduction programs, environment protection system let on improving operational excellence; thereby, the organizations were able to meet competitive advantage.
Developing a Model for Intrapreneuership
A model was constructed based on the overall findings in the study using the four outcomes purpose, influences, dimensions and contribution to the intrapreneurship. Figure 2, explained the simplification of factors of the role of intrapreneurship. The simplified model development was based on the theory of upper echelon (Hambrick, 2007) and the theory of Bricolage (Strauss, 1962). However, the generic model depicted in Figure 2 can be used in SMEs development and large organizational development as well.
The research outcome was twofold, how this model can be used in the development of manufacturing organizations and the new contributing factors evolved by this research and how to upgrade knowledge. The research findings explained many areas related to the organizational culture and work environment related to the performance of the organization. Some of the key findings are organizational culture, work systems, learning organization, good manufacturing, and ethical practices, etc. The findings refer to the question 1 and 2, transformational leadership, trust and confidence authority delegations (figure 2) related to the entrepreneurship personality type. The study analysed the relationship between entrepreneurship and intrapreneurship in all the sample organizations. In addition to the transcription, the observations in the field visits were evidenced a high level of relationship between entrepreneurship and intrapreneurship. That was the fact in having trust, confidence and authority delegation as a result of the personality type of entrepreneurship. In another way, those are a contribution to intrapreneurship development as well. The sample organizations were the example in having leadership with all these personality qualities, which were the key success factors behind organizational development.
The factor of objective-driven was initiated from the ISO practices. The excellent support of entrepreneurship in maintaining the ISO system in the sample organizations. Entrepreneurship tends to restrain authority delegation and training to their subordinate, assuming the risk to their business. The ISO system avoids that issue and standardized all the functions and activities within the organization. ISO avoids risky situations making dependence on systematization, not individuals. Echelons are employees in all the SMEs as part of the management. However, all the echelons are not intrapreneurs. "Intrapreneurs are mostly made, though inner predispositions may play some role" (Pinchot & Pellman, 1999) Echelons become intrapreneurs after developing entrepreneurial skills within the organizations. Intrapreneurship has become a vital element in economic and organizational growth (Nicolaidis & Kosta, 2011) that stimulates exponential growth to the organization. The study explored influencing antecedents related to individuals within the SMEs in Sri Lanka. Intrapreneurship demands a unique blend of managerial and entrepreneurial skills to achieve organizational innovation, growth and competitive advantage (Nicolaidis & Kosta, 2011). The theory of upper echelons says that manager's attributes reflect in the organizational performance (Hambrick, 2007; Hambrick & Mason, 1984). Hence the developments of the entrepreneurial skills of echelons are an essential factor in becoming an intrapreneur. The factors knowledge updating, networking, opportunity-seeking within the organization and learn by works were the factors related to the development of entrepreneurial skills. The factors that derived in the research would contribute to the echelons in the organizations to enhance their knowledge and capabilities as a functional requirement in the development of entrepreneurial skills in their development as well.
The personality factors of the echelons played a significant role in the management of the sample organizations. They are the front-liners who interacted with the employees down the line and top management as well. In most cases, they get pressure from both parties of co-workers and ownership. The themes of personal branding, visionary personality, self-efficacy, self-satisfaction, and work-life balance were categorized under the personality factors of the concept of intrapreneurship. These research findings contributed to the development of personality factors of echelons to become intrapreneurs. The manufacturing sector involves different types of technologies and operational disciplinarians such as marketing, supply chain, production, quality, engineering, research, and development etc. The factors explored in the research are Multidisciplinary capability, administration capability, achievement-oriented.
SME development has become a vital requirement for all the countries that have shown high contributions to the country's GDP growth. More than 50% of contributions have made by the developed countries (Zafar & Mustafa, 2017). The contribution of SME manufacturing to the GDP in Sri Lanka indicated 52% (CMA, 2018; DCSL, 2017). The study contributes to the aspect of SME development that was categorized into two areas of social and economic related. Entrepreneurs are prone to functional activities focused on core competencies. Intrapreneurs are more prone to both functional and administration. The factors explored under the dyadic effect are the most important to the organizational survival such are skill integration, information sharing, strategic alignment of function, the effect of bricolage, award-winning culture, cohesion in decision making. The effects found are high contributing as the competitive advantages as well in reducing the cost of production, which are the constraints in the Sri Lankan manufacturing sector. Intrapreneurship is a competitive advantage to the manufacturing organization (Nicolaidis & Kosta, 2011; Rodrigues, 2010). The effects of the relationship of the management influence on gaining a better management process to the organization with a high calibre involvement of information sharing, strategic process alignment, effective decision making, bricolage effect, nature of award-winning and skill integration. The effects of having an implementation of these factors, the performances of the SMEs gained in exponential growth in the area of economies of scale, economies of scope, product quality, better work environment, better network with all types of ties, low cost of the product due to low expenses. All these outcomes highlighted in the manufacturing due to maintaining a high level of relationship between entrepreneurship and intrapreneurship. It provides a competitive advantage to the organization.
Limitation and Future Research
Inability of generalizing the research findings is one of the main limitation in the qualitative research (Polit & Beck, 2010). However, the knowledge gathered was in a manner of highly trustworthy and ethical. However, the model constructed (Figure 2) based on quadruplex factors based on previous literatures, theories and research findings, thus it can be adapted and practiced in the development of SMEs in the context and similar context as well.
This study explored a wider knowledge of the concept of intrapreneurship which is new concept within the context. Limitation of time curtailed testing all the research findings, and further researching can be tested using quantitative approach. The research strategy enables the researcher to conduct the research systematically rather than haphazardly in finding solutions to the research questions (Kilani & Kobzive, 2016). The research examined a cross-sectional analysis; hence suggested to conduct more research for each theme or sub sections in this study. Therefore, conducting a action research or longitudinal research would recommend for gathering further knowledge about the concept of intrapreneurship.
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