Approximate reading time: 3-4 min. Research on the topic of corporate entrepreneurship has grown steadily over the past few decades, largely due to the link between product market and technical innovation (ie the impact of corporate entrepreneurship activities) and the company’s success. Similarly, there is empirical support for operational management (or management control) to be an important factor for successful companies.
Operational management counteracts innovation capabiliteis?
On the surface, these two phenomena, corporate entrepreneurship and operational management, seem to represent an inherent contradiction. That is, corporate entrepreneurship aims to take the company into new directions. On the other hand, operational management is aimed at channeling, which often limits the scope of actions.
Therefore, a study examined how operational management works along with the factors that influence corporate entrepreneurship to promote innovation. The study was conducted as a survey and included 177 companies operating in a variety of industries.
Conclusion for you as a manager and leader
Takeaway no 1
Intentional design and development of controls aimed at supporting corporate entrepreneurship may not have the intended effect on innovation. As such, the manager’s task is not only to build an organization whose core features are to contribute to innovation. Rather, his or her task is to design and develop innovation and operational support facilitating mechanisms that complement each other so that the entrepreneurial potential within the organization is maximized for organizational purposes.
Takeaway no 2
The results also indicate that managers should understand and treat innovation as a process that is susceptible to the application of structured and disciplined governance. Successful driven innovation requires managers to address innovation challenges with the understanding that desirable innovation results can be generated and constructed consciously. There are rules, methods and general process knowledge that can be used as resources to facilitate successful innovation. It is often not the absence of rules and well-established procedures that result in successful innovations (which can be deduced from an overview of popular business pressures). On the contrary, it is its presence. Managers are wise to acknowledge this reality.
Takeaway no 3
Successful and lasting promotion of innovation, which takes place through the company’s entrepreneurship, is unlikely to be achieved by relying on individual governance mechanisms, such as the use of organizational structure. This study shows that the best innovation results are undoubtedly a result of operational management and the use of controls related to entrepreneurship, acting in agreement. Therefore, managers should adopt a system perspective with regard to management of innovation, acknowledge relationships and mutual dependencies that exist between forces that facilitate the innovation process and the powers that control it.
Goodale, J. C., Kuratko, D. F., Hornsby, J. S., & Covin, J. G. (2011). Operations management and corporate entrepreneurship: The moderating effect of operations control on the antecedents of corporate entrepreneurial activity in relation to innovation performance. Journal of Operations Management, 29 (1-2), pp. 116-127.
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