Intrapreneurship programs are not easy to implement.
Since business environments are rapidly changing, it isn't surprising that intrapreneurship programs are increasingly popular. They support employees develop innovative solutions, often informed by their daily interactions with customers, partners and other stakeholders.
Yet not every intrapreneurship program leads to successful outcomes beyond innovation theatre. How to make them work? What is the best way to maximize their potential?
During our recent Innov8rs Learning Lab on Innovation Strategy, Leadership, Governance & Portfolio Management, we asked Christian Stumpf (Co-Founder & Program Manager TenneT PowerLab at Tennet) these questions.
As summarized below, Christian shared four lessons he learned while working at DB Intrapreneurs that have helped him launch and run PowerLab, TenneT's intrapreneurship program.
1. Your Employees Are Your Users
Founded in 1994, the German railway company Deutsche Bahn today employs over 300,000 people. Deutsche Bahn Company has been investing in existing startups since a few years ago, enhancing its portfolio and accessing new digital business opportunities through its Corporate Venture Fund. In addition, Deutsche Bahn has developed an intrapreneurship program, "Beyond1435", to tap into its employees' expertise and domain-specific knowledge and ultimately unleash their innovation potential.
The aim was to empower intrapreneurs to run through the same process as external startups. However, there is one major component Deutsche Bahn failed to consider: people's feelings and beliefs. And, according to Christian, this is why Beyond1435 didn't really work as an intrapreneurship program. In fact, after a few interviews, it turned out that people wanted to push things forward within the company, not as intrapreneurs but as employees. They didn’t want to become entrepreneurs and startup founders.
Eventually, the intrapreneurship program “Beyond1435” was replaced by “DB Intrapreneurs”. The difference between the two is the conveyed message: through DB Intrapreneurs, employees still have the chance to leave the company and found their own external startup, but they can also create new units, business models, and innovations within the organizational boundaries. Thus, the goal of DB Intrapreneurs is twofold:
· Diversify DB's product portfolio by developing new digital business models.
· Provide employees with opportunities to learn user-centered and agile methodologies as well as entrepreneurship, thereby fostering long-term cultural change.
“If your intrapreneurship program is still the same a year from now, you're doing something wrong".
This example shows that a successful intrapreneurship program requires you to treat your employees as users. It is crucial to understand what they actually want, how they feel, and what they consider intrapreneurship. A successful intrapreneurship program constantly evolves, refines, and improves itself to meet its users’ needs.
2. Don’t Look For Good Ideas. Identify Relevant Problems
Corporate innovation (and innovation in general) is often thought to require great ideas. Yet not every idea has the potential to be an innovation. Innovations begin with ideas, that's true. It's wise, however, not to confuse a winning idea with where it came from. In other words, neither brainstorming nor ideation workshops can produce meaningful or useful ideas. Pressing issues usually spark innovative ideas. To put this into context, Christian shares the following example.
Today YouTube is one of the world's biggest video-streaming platforms. Few know that YouTube was originally meant to be a video-based online dating service. However, people didn't like recording a video of themselves to find their significant other online- so the idea didn't work out. Despite this, its founders were smart enough to realize that YouTube still had great untapped potential.
Video files were simply too large for individual users to share in the early 2000s. Therefore, YouTube was set up to resolve this pressing technological problem in video consumption. In no time, it had become a global online video-sharing and social media platform.
"If somebody comes up with a good idea, don't ignore it. However, it is only a starting point for identifying the underlying problem".
The lesson here is that a successful intrapreneurship program primarily relies on a problem-first mindset. And it's up to leaders to promote and foster this thinking throughout the organization.
3. Adapt Your Innovation Process
When you adopt that problem-first mindset and ask for challenges instead of ideas, you must adjust the innovation process accordingly. In fact, it doesn't make sense to encourage intrapreneurs to identify and bring out problems if you expect them to have a problem-solution fit from the beginning.
"Building a startup is about setting goals and creating a vision. Whilst corporate innovation involves building bridges and meeting people where they are".
As Einstein once said: “If I had an hour to solve a problem, I'd spend 55 minutes thinking about the problem and 5 minutes thinking about solutions”. This quote makes a crucial point: solving problems requires preparation.
Therefore, ensure that your innovation process gives intrapreneurs room to explore the identified problem before they launch and grow their solutions. Later in the article, we'll see what this process looks like at PowerLab.
4. Define Success And Matching Metrics
How can intrapreneurship programs be measured? Answering this question is not easy. It typically takes a long time for them to gain traction and broad support in corporate settings. Furthermore, the new business models will rarely be profitable whilst part of the program. Hence, profits or financial returns on investment are not the best indicators to use. However, there's no definitive solution or preferred way to measure them.
All you have to do is define success metrics that reflect both your innovation process and the stage of your project funnel. The number of ideas received, the number of projects reaching certain stages, and the number of projects handed over to internal units or spun out can all be valuable indicators.
Putting The Learnings Into Practice: TenneT Powerlab
Christian learned a lot about intrapreneurship at Deutsche Bahn, first within the "Beyond1435" program, then within "DB Intrapreneurs". So when he co-founded PowerLab at TenneT, he had the chance to put all of his learnings into practice.
As mentioned, employees are the end users of any intrapreneurship program. As such, Christian and his team interviewed hundreds of employees before setting up the program, without even mentioning the word 'intrapreneurship'. These interviews eventually led to the development of PowerLab's value proposition. It was found that employees want to validate their projects, get management exposure, get real customer feedback, and learn more about innovative methodologies. Thus, PowerLab today offers those who want to work like entrepreneurs within TenneT the opportunity to:
- Get the budget their project needs
- Have dedicated time to work on their project
- Benefit from fast decision-making
- Meet innovative, like-minded colleagues
- Work like an entrepreneur within the company
- Get leadership attention
- Broaden their network within TenneT and beyond
The coaching and support provided by executives and experts give intrapreneurs a chance to realize their projects and gain invaluable entrepreneurial skills. It’s PowerLab's mission to give intrapreneurs the space and resources they need to successfully validate and execute their projects. The program is then composed of three sequential phases: Explore, Develop, and Establish.
a. Explore: explore the identified problem
In this first phase, the intrapreneurs focus on validating the challenge their project tackles and proving that it’s relevant for TenneT and its stakeholders.
· Typical activities in this phase include: Desk Research, Customer Interviews, and Stakeholder Mapping.
· In terms of corporate support, here intrapreneurs get: Business Model Coaching, Networking and Education, and Developing a Startup Mentality.
b. Develop: prove that you can solve the challenge
In the second phase, intrapreneurs must prove that they can solve the challenge with their project. They have to develop a prototype of their solution, test it with potential internal or external customers, and thus get feedback and improve it iteratively.
· Typical activities in this phase include: Testing, Prototyping, and Experiments.
· In terms of corporate support, intrapreneurs here get: Venture Architect Coaching, Technical Experts, and Networking.
c. Establish: launch and grow your project
The third phase is for launching, establishing, and growing projects. As such, all aspects of the new business model should be tested in a small-scale pilot.
· Typical activities in this phase include: User testing, Business Model Validation, and Implementation.
· In terms of corporate support, intrapreneurs here get: Venture Architect Coaching and Technical Experts.
In Summary
As corporate innovators, we often wonder how to leverage the innovation potential within our companies. An intrapreneurship program is a good solution. The benefits of such programs include encouraging employees to think differently, boosting morale and productivity, and attracting and retaining top talent.
However, making them work can be challenging. The program's value proposition must reflect the employees' needs: do they wish to contribute to company innovation or become startup founders? Once this is clear, the process must be (re)organized to involve intrapreneurs in finding real problems to solve, not coming up with great ideas.
Furthermore, intrapreneurs need space and time to analyze the problem highlighted and find an appropriate solution. And so, consider the following crucial points:
- Employees are your program's actual users. And an intrapreneurship program cannot succeed if it fails to consider its users' expectations and beliefs. Therefore, before setting up such a program, analyze what they want, their entrepreneurial aspirations, and their motivations. At this point, you can design (or re-design) the program.
- Great ideas won't set your intrapreneurship program up for success. The real keystone of any intrapreneurship program is the ability to identify real, pressing problems. In fact, it's actually pressing issues that lead to innovation's best ideas.
- Problems take time to solve. Therefore, don't expect your intrapreneurs to identify relevant problems and provide ready-made solutions. Allow them to explore, test, and validate. For the same reason, define success metrics that match the innovation process- ROI is not a good indicator to use.
