Study into the Adoption of Innovation in Organizations

Published: Last Edited:

This essay has been submitted by a student. This is not an example of the work written by our professional essay writers.

Due to the rapid and continual changes in the current business world which was the result of globalization, innovation was seen as a growing urgency for the organizations in order to stay ahead and remain resilience.

According to Pinchot and Pellman (1999, p.11), innovation is necessary to "differentiate one's offerings, to find and fill unoccupied spaces in the market, and to keep up with the soaring productivity of competitors". De facto standards like the Windows operating system would be replaced by something better if they were not supported by energetic innovation. Rapid and cost-effective innovation is the primary source of lasting competitive advantage in the twenty-first century, leaving organisations no alternative but to innovate well or cease to exist.

Promoting innovation within the companies has been widely examined, investigated and shown in many studies and research as one of the key element for companies long term success, survivability and ability to maintain its market presence and position (Kuratko et. Al., Lumpkin & Dess, 1996; Miles & Covin, 2002; Zahra & Covin, 1995; Zahra et. Al., 1999b).

Studies also indicate that entrepreneurship quality can be use by the companies to encourage innovation such as the technological innovation, operational innovation or innovations in other processes. According to Bartlett & Goshal (1998), organizations normally emphasize on technological innovation, as that is the one that drives and provide revenue for the company. This was further echoed by Dunning (1994) and Chisea (1999).

Collin J (2001) and Collin J & Porras J I (2002) put forward that organizations can increase efficiency by improving communications, improving the quality of services, product enhancement and improving the work place atmosphere. Discussions, suggestions and actively engaging positive communication between all levels of staff can generate new ideas which will be beneficial to the organization.

Robbins (1997) stated that successful organizations must promote innovations in order to avoid being left behind, and De Coning (1992) further commented that this can be achieved by encouraging entrepreneurial spirit within the organization to support the initiatives.

Talking about being innovative and its role in a franchise system, marketing researches suggest that unit-level innovation and adaptation is an important component of franchise system success and survival (Kalvins and Lafontaine, 1997; Fulop and Forward, 1997).

Seri Malaysia Hotel, in this case had developed its business model based on a franchise system whereby an individual, upon fulfilling all the requirements, will be appointed as the franchisee and the owner which is Rangkaian Hotel Seri Malaysia Sdn Bhd is the franchisor.

This research paper will examine intrapreneurial behavior in Seri Malaysia Hotels' Franchise System and its role in the competitiveness of Seri Malaysia Hotel. Intrapreneurship refers to the application of entrepreneurial principles within existing organizations and is cited as particularly important in the development of innovative marketing strategies at the firm level (Stanworth & Curran, 1999; Timmons and Spinelli, 2004).


The primary aim of this study is to examine the level of intra-corporate entrepreneurship (intrapreneurship) within Seri Malaysia Hotels, and the intensity of it being inculcate in the Seri Malaysia chain of hotels.

By instilling and inculcate intrepreneurial culture in the organizations through being innovative, this would lead to the creation of more values to the stakeholders. This will allow the company to focus on its people and to empower them accordingly. The environment created is more conducive and with such opportunities and exposure, franchisees and/or staff's level of commitment and would also heightened.

Based on the above research statement, this study is aimed to review strategies which are being used and to recommend other strategies in order to enhance the commitment of Seri Malaysia's franchisees and/or staff and also the Rangkaian Hotel Seri Malaysia Sdn Bhd in her capacity as the franchisor of the Seri Malaysia Hotel's Franchise System to maintain its competitiveness in this dynamic market. The study also will determine whether Seri Malaysia Hotel's franchisees and/or staff have the necessary intrapreneurial skills and were given an opportunity to apply them by:

Assessing the level of intrapreneurial skills in the Seri Malaysia Hotels;

To identify the level of support of intrapreneurship in the company;

To measure the opportunity for franchisees and/or staff to apply it;

To determine why the intrapreneurship quality is low.


In order for organization to compete successfully, the managers and management must have a solid understanding and empathy on what had actually influenced their intrapreneurial culture.

As the company increases its market penetration by building and having more new hotels, it would be detrimental if the company does not have appropriate system and culture in place. And if the proper culture is not being promoted and put in place, it may suppress the entrepreneurship spirit which may misaligned with its objectives which is to develop more trained entrepreneur in the hotel industry.

The result of this study could be useful to provide few recommendations as to how Rangkaian Hotel Seri Malaysia Sdn Bhd should play her role to stimulate pro-activeness among her franchisees and/or its staff, to promote innovation, to improve processes and ultimately increasing its productivity and her presence in the market.




Intrapreneurship is a concept linked to the entrepreneurial orientation of an organisation. Intrapreneurship has its roots in entrepreneurship literature, even though intrapreneurship as a concept has lately been positioned also in the management literature (Antoncic - Hisrich, 2003). Intrapreneurship is important for organisational survival, growth, profitability, and renewal (Zahra 1995, 1996), especially in larger organisations. It seems that different kinds of organisations are eagerly promoting entrepreneurial activities within their staff and management teams.

Different kinds of intrapreneurship have been recognised in the previous research (Antoncic - Hisrich 2001, Covin - Miles 1999, Sharma - Chrisman 1999). Innovation broadly defined is the common theme underlying all forms of intrapreneurship. To be more precise, the use of innovation as a mechanism to redefine or rejuvenate the organisation, its position within markets and industries, or the competitive arena in which the organisation competes, seems to form the core of intrapreneurship. (Covin - Miles 1999)

Intrapreneurship includes several focal areas of research such that of 1) individual intrapreneur emphasising the individual characteristics of an intrapreneur, 2) new venture creation within existing organisation emphasising the different types of new ventures and their fit with the organisational setting, and 3) entrepreneurial organisation emphasising characteristics of such an organisations. (Antoncic - Hisrich 2003).


Theoretically the study is based on entrepreneurship research, especially the Intrapreneurship School of it (Cunningham - Lischeron, 1991). Intrapreneurship is a concept closely related to entrepreneurship emphasising the entrepreneurial process (entrepreneurs carry out new combinations) and innovativeness (Guth - Ginsberg, 1990).

Intrapreneurship, however, takes place within the organisation, in this study in small companies. The intrapreneur acts like an entrepreneur in that he/she realises his/her own ideas without being the owner of the enterprise (Cunningham - Lischeron, 1991).

Intrapreneurship is here defined to mean an entrepreneurial way of action in an existing organisation - more specifically, in a small company. This may be the broadest possible definition for intrapreneurship. This broad definition is a kind of an indication of a relatively early stage of development of the field. (Antoncic - Hisrich 2003).

The basis of intrapreneurship is recognising an opportunity, exploiting it and trusting that exploiting an opportunity in a new way that deviates from previous practice will succeed and support the realisation of the organisation's aims. (Heinonen, 1999)

Research into the nature, prerequisites and effects of firm-level entrepreneurial activities has grown over the past 25 years. The seminal study of Peterson and Berger on entrepreneurship in organizations (1972) sought to identify organisational and environmental factors affecting company's entrepreneurial activities. Miller's study in 1983 was a key turning point in the research on firm-level entrepreneurship. After that researchers have used Miller's theory and research instruments to examine the linkages between environmental, strategic, and organisational variables, and a company's entrepreneurial activities. (Zahra - Jennings et al. 1999)

In this study the researcher has organized the prerequisites and outcomes of intrapreneurship, as well as the phenomenon of intrapreneurship as follows (Figure 1):

Figure 1 The model of intrapreneurship


This study takes Miller's (1983) contribution as a starting-point for understanding the phenomenon of intrapreneurship. Miller stresses the company's commitment to innovation, i.e. three related components: product innovation, proactiveness, and risk taking.

Product innovation refers to the ability of a company to create new products or to modify existing ones to meet the demands of current or future markets.

Proactiveness refers to a company's capacity to compete in the markets by introducing new products, services, or technologies.

Finally, risk taking refers to company's willingness to engage in business ventures or strategies in which the outcome may be highly uncertain. (Zahra - Covin 1995)

Together these components form the first manifestation of intrapreneurship, emphasising the creation of innovations and ventures as well as conducting R&D -activities aiming to improve organisation's competitive position and performance.

The second dimension of intrapreneurship is strategic renewal of the existing business of intrapreneurship. This strategic renewal of an existing organisation entails areas such as mission reformation, reorganisation as well as system-wide changes within the organisation. (Zahra 1991, 1993, 1996).

The renewal activities relate to the concept of a firm's business and its competitive approach in the markets. Renewal is achieved through the redefinition of a firm's mission through the creative redeployment of resources (Guth - Ginsberg 1990). Renewal requires developing or adopting new organisational structures that promote innovation and venturing. Renewal also covers system-wide changes, which enhance creative organisational learning and problem solving. These changes usually refocus company's basic values. (Zahra 1993)


As indicated earlier, several researchers have attempted to understand the factors that stimulate or impede intrapreneurship. Areas such as external environment, organisation, its strategy, and management activities have been presented as factors affecting intrapreneurship (Guth - Ginsberg 1990, Miller 1983, Kuratko et al. 1990, Heinonen 1999).

Intrapreneurship is a process, which occurs in interaction with the environment (van de Ven 1993). It appears that the environment plays a profound role in influencing intrapreneurship: the more dynamic, hostile and heterogeneous the environment, more emphasis the company puts on intrapreneurial activities (Zahra 1991, 1993).

The intrapreneurship literature highlights the importance of organisational factors for the pursuit of intrapreneurship (Slevin - Covin 1989, Zahra 1991, Antoncic - Hisrich 2001, Heinonen 1999, Heinonen - Vento-Vierikko 2002).

By management activities we refer to the role of management as a facilitator and promoter of intrapreneurship (the charismatic role of management by Thompson 1999). Management activities also affect the organisational culture: at what extent the basic assumptions of intrapreneurship (risk taking, innovation and creativity, learning, change) can be found within the organisation.

Management activities ensure that the organisation has a clear and understood vision and direction. The organisational setting also includes the way work is being organised in the company: power and responsibility, division of work and rule. Altogether these organisational factors both direct the employees in their intrapreneurial efforts, as well as ensure that employees are empowered and committed. (Thompson 1999).

Previous studies indicate that managerial support, organisational structure as well as reward and resource availability affect intrapreneurial activities within the organisation (Hornsby et al. 1993, Antoncic - Hisrich 2001).

All the potential elements of intrapreneurship mentioned earlier are factors assumed to affect intrapreneurship on organisational level. Within intrapreneurship, as within entrepreneurship, the individual is the key actor, making it understandable why the intrapreneur also a focal area of intrapreneurship research (Carrier 1996). The individual skills and attitudes describe the capabilities and willingness of any potential intrapreneur to act intrapreneurially.


It is evident that intrapreneurship can give grounds for competitive advantage of an existing organisation. The manifestations of such competitive advantage may be differentiation or cost leadership in the markets, quick response to any changes, new strategic direction or new ways of working or learning within the organisation. (Covin - Miles 1999).

Prior research proposes that intrapreneurial processes are associated with an organisation's performance (see e.g. Zahra 1991, Zahra 1995, Zahra - Nielsen et al. 1999, Heinonen 1999, Antoncic - Hisrich 2001). Zahra - Nielsen et al. (1999) raise up the importance of organizational learning and knowledge creation as outcomes of intrapreneurial activities, and, thus, as grounds for competitive advantage and a basis of superior performance of the organisation. In this study organisation performance does not include only financial performance, but also non-financial manifestations, such as customer satisfaction as well as job satisfaction of the employees.




This research is exploratory and the researcher will use questionnaires to examine the independent variables and the dependent variables. There are 19 Seri Malaysia Hotels operating throughout Malaysia which covers various localities. It would have been better to determine the intensity of intrapreneurship culture based on localities. Thus this will require an extensive survey and designing appropriate questionnaires in order to get the right responses. Hence, quantitative survey approach will be adopted in this research as it provides more objectives and independent for research basis (Borg and Gall, 1989).

Sekaran (2001) notes that the descriptive study is undertaken when the characteristics or the phenomena to be tapped in a situation are known to exist, and one wants to be able to describe them better by offering a profile of factors. In other words, descriptive study enables the researcher to analyze the level of intrapreneurial traits in Seri Malaysia Hotels and the perception of being known as innovative organizations.

According to Bell (1993), hypothesis testing offers and enhanced understanding of the relationship that exists among variables. It may also be seen as the guide to the researcher in that it depicts and describes the method to be followed in studying the problem.

However, in this study, the researcher will use questionnaires to examine the independent variables and the dependent variables. By using questionnaires the researcher believed that respondent will be properly guided to put down their perception towards intrapreneurial culture and whether the current system practice by Seri Malaysia Hotels are promoting intrapreneurship.


Primary Data

This study is to be carried out on the franchisees themselves, their number two in-line and also the top management of Rangkaian Hotel Seri Malaysia Sdn Bhd consisting of Managing Director, General Managers, Senior Managers and Managers. Being the leaders in their respective hotels and departments, these primary data are quite independent and may possess the entrepreneurial qualities.

In total, the target respondents of this primary data are as follows:

i) Franchisees - 18

ii) Franchisees's second in command - 20

(Executive Assistant Manager)

iii) Franchisees's third in command - 150

(Head of Department such as F&B, Front Office, Sales)

iii) Rangkaian Hotel Seri Malaysia's Top Management - 10

In order to avoid biasness and to obtain accurate response, multiple choices, dichotomous and scales will be used as the basis for the questionnaire structure.

Secondary Data

Secondary data are to be obtained from both internal and external resources including journals, books, articles gathered from the Internet and Emerald. Some information from magazines, periodicals and electronic journals will also be used. The importance of secondary data is to provide a basis for comparison.


The aim of this study is to discuss and analyse the potential elements and outcomes of intrapreneurship and to measure these in small business context. Even though this study is of quantitative nature, this research is still very much a work in progress, and, thus no model testing per se can take place at this stage of the research process.

Two kinds of questionnaires were used in the research: one to an organisation's entire personnel and other to the organisation's management. The personnel survey contains queries about management activities, organisational culture, individual skills and attitudes, customer satisfaction and job satisfaction.

The management survey concerns an organisation's venture activity and innovations, its strategic renewal as well as basic information about its background and industry. Each potential respondent was sent a personal questionnaire. An invitation was sent by email containing a link to a page with the questionnaire on it. These links were personalised and unique. The answers were stored on a database, accessible only by the researcher. That way the possible social desirability biases were taken into account.

In this paper we will be discussing solely the results of the personnel survey and exclude the management survey because of the small amount of data at this time. Due to a naturally smaller number of management level personnel in Rangkaian Hotel Seri Malaysia, the amount of data in the management survey is not sufficient for analysis at this time. Based on these preliminary results more data will be gathered in due course.

The survey gives information about the potential prerequisites and outcomes of an organisation's intrapreneurship. The studied items analysed in this paper are (see Figure 1, the prerequisites and outcomes measured in this study are darkened):

management activity and organisational culture (structured)

organisational setting (structured)

individual skills and attitudes (structured)

perceived customer satisfaction (structured)

job satisfaction (structured)

The above-mentioned sectors were divided into two groups. The three first ones describe potential elements of intrapreneurship and the latter two measure company performance. In order to reduce the amount of survey statements, we conducted a factor analysis on both of the two data groups.

The factorability of the variables was evaluated using the Kaiser-Mayer-Olkin (KMO) measure. The KMO measure defines for factoring as follows: > 0.90 = excellent premises; > 0.80 = good premises; > 0.70 = moderate premises; > 0.60 = marginal premises; > 0.50 = feeble premises; > 0.40 = not worth factoring (Olkkonen & Saastamoinen 2000).

The dependency relation between potential elements of intrapreneurship and firm performance was studied by way of correlation analysis. The limit to an acceptable correlation coefficient in the study was defined as 0.4 based on the Guilford 5-level interpretative model (Guilford, 1956). The utilisation of this correlation coefficient of average is reasonable in that the amount of data used is large enough.


A total respondent targeted may not be able to represent the hotel industry in Malaysia. Simultaneously it cannot be construed as representing the franchise businesses in Malaysia. The number of respondent may accurately provide information on Seri Malaysia Hotels' Franchise System only and it may not be suitable for other type of franchise businesses.

The research has some restrictions: as mentioned earlier, we are dealing only with a part of our data and due to the insufficient number of management surveyed so far we excluded it. Thereby we concentrate on potential elements of intrapreneurship that are influenced upon by the information received from the personnel surveys. The measurement of customer satisfaction also needs to be clarified, since the data contains only employees' perceptions about the customers' opinions. The data, thus, does not include the customers' opinions on the issues analysed.




A factor analysis on potential elements of intrapreneurship brought up ten factors (table on factor loads is in an appendix 1 at the end of the paper). Further analysis was done with the first seven factors. The rest of the factors were excluded, because their degree of an explanation was rather low and any sensible interpretation was not easy to make. The factors left in the analysis explained 54% of the phenomenon. Factors were named as follows:

encouragement by management and organisation

individual motivation

transparency, openness and communality

individual competence

enabling working environment

encouragement to innovations


The first factor expresses activities of management, culture of working environment as well as an organisation's attitude climate towards intrapreneurial activities.

The second factor describes employees' abilities and willingness toward meaningful work.

The third factor represents an organisation's openness and sense of community.

The fourth factor sorts out individual motivation elements.

The fifth factor brings out chances offered by an organisation's operational environment.

The sixth factor is attached to encouraging to innovate.

The seventh factor demonstrates development in general.

Aggregate variables composed through a factor analysis are collected into the following table (Table 1). The final number of aggregate variables is seven.

Table 1 Potential prerequisites of intrapreneurship, scale 1 to 5

agree strongly or agree somewhat

Aggregate variable 1: encouragement by management and organisation

mean = 3.3

Management activity generates trust in employees

3.7 (n = 183)

Management sees matters also from the employees' point of view

3.4 (n = 181)

Management is able to inspire everyone to work for the good of the company

3.6 (n = 183)

Management encourages the development of new ways of operating

3.4 (n = 183)

At my workplace, individual work methods are valued

3.2 (n = 180)

Innovativeness and creativity are thought of as important at my workplace

3.3 (n = 181)

Change is seen as an opportunity at my workplace

3.5 (n = 181)

Enough feedback is given at my workplace

2.8 (n = 183)

The employees are encouraged to freely air their opinions

3.1 (n = 182)

Suggestions originating from the employees are carried out at my workplace

3.3 (n = 182)

There is a clear division of labour in my workplace

3.7 (n = 183)

My workplace offers good opportunities for training and education

3.2 (n = 181)

My workplace has clear rules of conduct

3.5 (n = 181)

Things are carried out without delay at my workplace

3.0 (n = 181)

The vision at my workplace guides me at my work

3.3 (n = 181)

Knowledge flows openly at my workplace

2.8 (n = 182)

Aggregation variable 2: individual motivation

mean = 4.0

I have confidence in my abilities

4.3 (n = 183)

I want to actualise myself in my work

4.3 (n = 183)

I want to put myself at stake in my work

4.0 (n = 182)

I am ready and willing to make responsible decisions

4.0 (n = 182)

I tolerate uncertainty well

3.2 (n = 181)

Aggregate variable 3: transparency, openness and communality

mean = 3.4

Difficult decisions are discussed openly

3.0 (n = 182)

Employees' productive activities are rewarded

2.9 (n = 181)

Work is carried out in teams at my workplace

3.5 (n = 182)

I know what is expected of me in my work

4.1 (n = 183)

I can easily get help in my work

3.7 (n = 182)

Aggregate variable 4: individual competence

mean = 3.8

I am familiar with the vision of my workplace, i.e. the direction pursued in the future

3.7 (n = 183)

I am eager to present new ideas at my workplace

3.7 (n = 182)

My knowhow is varied

4.1 (n = 183)

I develop myself actively at my work

3.6 (n = 183)

Aggregate variable 5: enabling working environment

mean = 4.2

I have sufficient authority to carry out my duties well

4.0 (n = 182)

I have responsibility for doing my work as well as possible

4.6 (n = 183)

I can work spontaneously

4.1 (n = 182)

Aggregate variable 6: encouragement to innovations

mean = 3.3

People are encouraged to take risks at my workplace

2.6 (n = 181)

Mistakes are regarded as learning experiences

3.5 (n = 182)

I am able to develop my work myself

3.8 (n = 182)

Aggregate variable 7: development

mean = 4.0

Professional development is important to me

4.1 (n = 183)

It is easy for me to seek help in my work

4.1 (n = 183)

I like to work in a team

3.9 (n = 183)

The aggregate variables were handled as means. The aggregates were analysed with a scale of 1-5. A smaller value means a divergent opinion from, and a greater value an opinion concurrent with the statement. The critical value of the scale is defined as three, values below which imply a need for development in the respective statements' areas of intrapreneurship. Likewise, values higher than three point to positive dynamics from an intrapreneurial point of view.

Every variable's values were over the critical value (3.0). Enabling working environment achieved the highest marks (mean 4.2): respondents believe that they have enough authority and responsibility for doing their job in a best possible way, and that they are allowed to work independently.

Individual motivation (mean 4.0) and development (mean 4.0) were also sources of satisfaction. Respondents trust in their abilities and are motivated to work in an intrapreneurial way. Similarly, development in general is expressed as important, for instance professional development is of concern and a request for help is seen as comfortable.

Individual competence (mean 3.8) also settles well in the scale. Respondents feel like multiple skilled persons and they are willing to further advance their professional skills. Employees are also aware of their organisation's vision and are keen on presenting new ideas.

The value of transparency, openness and communality is 3.4. Statements within the aggregate variable scatter: e.g. employees are well aware of expectations they meet in their work, but then rewarding of productive work is minor.

Encouragement by management and organisation (mean 3.3) as well as encouragement to innovations (mean 3.3) split the opinions of respondents. Some elements like confidence in management, clear division of work and management's enthusiasm for encouraging employees seem to be OK. Instead, flow of information and degree of feedback are both of marginal satisfaction.


A factor analysis on firm performance produces four factors (table on factor loads is in an appendix 2 at the end of the paper). Further analysis was made with the first three factors and their degree of an explanation was 55 %. The final factor was excluded from the analysis, because its components didn't form in a sensible way. Factors were named as follows:

appriciation of work and job satisfaction

perceived customer satisfaction

external satisfaction in work

The first factor expresses appreciation of work and job satisfaction. The second factor demonstrates customers' various sources of satisfaction. The third factor describes external satisfaction of work.

Aggregate variables composed through a factor analysis are collected into the following table (Table 2). The final number of aggregate variables is three.

Table 2 Potential outcomes of intrapreneurship, scale 1 to 5

agree strongly or agree somewhat

Aggregate variable 1: appreciation of work and job satisfaction

mean = 3.9

I feel happy in my work

4.1 (n = 182)

I value my work

4.3 (n = 183)

Others value my work

3.5 (n = 182)

My work is interesting

3.8 (n = 181)

My duties at work are varied

3.8 (n = 181)

I feel I am important to my workplace

3.8 (n = 182)

Aggregate variable 2: perceived customer satisfaction

mean = 4.0

My workplace is a known in the marketplace to be competent

4.1 (n = 182)

Our customers are satisfied with services and/or products purchased from us

4.1 (n = 182)

We respond to our customers' needs better than our competitors

3.8 (n = 182)

We are familiar with our customers' needs

4.0 (n = 182)

Our customer relations are long term

4.4 (n = 182)

Our clients are happy with our price-quality relation

3.8 (n = 181)

Aggregate variable 3: external satisfaction in work

mean = 3.8

My workplace has a good atmosphere

3.7 (n = 183)

My workload is suitable

3.8 (n = 182)

As before with the prerequisites of intrapreneurship, the aggregate variables here were also analysed with a scale of 1-5. Again, a smaller value means a divergent opinion from, and a greater value an opinion concurrent with the statement. The critical value of the scale is defined as three, values below which imply a discontentment with the respective statements. Likewise, values higher than three point to positive experiences of outcomes of intrapreneurship. Again, the aggregate variables were handled as means.

All three aggregate variables of the outcomes of intrapreneurship settle in the scale very well, all of them were over the critical value (3.0). Customer satisfaction (mean 4.0) is seen as rather high, respondents believe that their customer relationships are long lasting and customers are pleased with the provided services and/or products. Respondents also estimated, that organisations they represent are well known and recognised, that they are well aware of the needs of their customers, and customers are satisfied with the price-quality relation.

Appreciation of work and job satisfaction (mean 3.9) is also seen as a source of contentment. Respondents enjoy their work as well as both themselves and others value their work. Employees also express their work as interesting, versatile and important for their organisation.

The external satisfaction in work (mean 3.8) is at an adequate level. Workload appears to be reasonable and climate is good among employees.


The potential correlation between prerequisites of intrapreneurship (encouragement by management and organisation, individual motivation, transparency, openness and communality, individual competence, encouragement to innovations, development) and outcomes of intrapreneurship (appreciation of work and job satisfaction, perceived customer satisfaction, external satisfaction in work) were examined with a correlation analysis. The aggregate variables formed earlier were placed in a correlation matrix (Table 3).

Table 3 Correlations between intrapreneurial prerequisites and outcomes of intrapreneurship

Appreciation of work and job satisfaction

Perceived customer satisfaction

External satisfaction in work

Encouragement by management and organisation

r = 0.407**

r = 0.410**

r = 0.472**

Individual motivation

r = 0.587**

r = 0.256**

r = 0.166*

Transparency, openness and communality

r = 0.348**

r = 0.403**

r = 0.417**

Individual competence

r = 0.557**

r = 0.343**

r = 0.179*

Enabling working environment

r = 0.474**

r = 0.226**

r = 0.233**

Encouragement to innovations

r = 0.461**

r = 0.232**

r = 0.298**


r = 0.263**

r = 0.132

r = 0.304**

Correlation analysis indicates, that nearly every aggregate variable has a mutual correlation with a statistical significance. However, a focus of interest was especially on relations between prerequisites and outcomes of intrapreneurship, as mentioned earlier. The expected strength of correlation relations also narrowed down the number of variables being of interest here.

Generally speaking appreciation of work and job satisfaction stood out from the rest of the outcomes of intrapreneurship with more positive correlation relations than others. Individual characteristics, management and organisational activities were quite strongly linked with appreciation of work and job satisfaction. A correlation with perceived customer satisfaction was in many cases lower.

However, management activities as well as organisational activities and culture correlated positively with customer satisfaction. External satisfaction in work correlated positively and strongly enough with managerial and organisational issues. The examined correlation relations are discussed in more detail in the following sections.

Encouragement by management and organisation correlates positively with every one of the aggregate variables outcomes of intrapreneurship. The strongest correlation is between external satisfaction in work and encouragement by management and organisation (r =0.,472). This indicates, that, somewhat expectedly, management as well as organisational activities that are intrapreneurially favourable by nature, are linked with a general job satisfaction and job appreciation and customer satisfaction.

Individual motivation also correlates positively with every outcome of intrapreneurship. This time correlation relations are not very strong, actually only appreciation of work and job satisfaction correlates to an extent that was relevant in the study (r = 0.587). Those employees with a trust in their own abilities and willingness for doing and investing in their job, appreciate their work and are satisfied with their job.

Likewise, transparency, openness and communality correlates positively with all outcomes of intrapreneurship. The highest rates of dependency are between external satisfaction in work (r = 0.417) as well as between perceived customer satisfaction (r = 0/403). This points to the fact, that those organisations with an open and communal culture are recognised as a cosy workplace, which also their customers value.

Individual competence correlates positively especially with appreciation of work and job satisfaction (r = 0.557). This indicates, that when employees are active and capable, they are happy in work and proud of it. The correlations between the rest of the outcomes of intrapreneurship were marginal and thus not of interest.

Enabling working environment correlates positively with appreciation of work and job satisfaction (r = 0.474). The result describes an interrelation between an authority together with a sufficient responsibility and the positive feelings of one's own work. The correlation between enabling working environment and customer satisfaction as well as external satisfaction in work was rather weak.

Encouragement to innovations correlates positively with appreciation of work and job satisfaction (r = 0.461). The dependence relation with the rest of the outcomes of intrapreneurship wasn't strong enough and thereby not of interest here. The result goes to show, that workplaces where individuality is valued, employees are feeling satisfied with their work

Correlation rates among the development aggregate variables were lower than the limit defined to sufficient dependency relation in the study.




This study has theoretically discussed the phenomenon on intrapreneurship as well as its prerequisites and outcomes. Empirically the study has shed some light on some of the potential prerequisites and outcomes of intrapreneurship. The phenomenon of intrapreneurship has been excluded from the empirical analysis as the number of respondents has this far been too small for statistical purposes.

The results point to the fact, that the surveyed prerequisites of intrapreneurship are related with the surveyed outcomes of intrapreneurship. In future, the surveyed prerequisites of intrapreneurship can be further separated into finer groups. That way, and also with a larger sample, it is possible to better understand and bring forth the relations between the prerequisites and the outcomes of intrapreneurship. The question of an intervening phenomenon remains still unanswered: is the intervening phenomenon intrapreneurship or something totally different? The possible relations between here surveyed issues and intrapreneurship need also to be clarified.

This discussion is an extensive one and merits a new paper. However, the study points out, that the prerequisites and outcomes of intrapreneurship have a positive dependency. This indicates, that the more the prerequisites of intrapreneurship are present both in quantity and quality, the more outcomes of intrapreneurship are observed.


The ultimate aim of this larger research programme is to create and validate a model of intrapreneurship. The basic idea from the very beginning has been to benefit from the existing models as much as possible. This study is our first attempt in this process. Even though our work is on its preliminary phases some conclusions can be drawn.

At this stage the largest restriction for conclusions is the small amount of companies analysed, even though the number of respondents in the personnel survey is at least adequate. After these preliminary findings more extensive and intensive data gathering is to follow.

However, increasing the number of companies involved does not solve all the problems foreseen. Firstly, it is very unlikely that antecedent variables affect the entrepreneurial behaviour of the company instantly, and that intrapreneurship improves company performance in the very short term. (Zahra - Jennings et al. 1999). Intrapreneurship is long-term in nature, which calls for studies of a longitudinal nature.

Secondly, intrapreneurship is not likely to evolve from any particular element, but is rather a matter of balancing certain types of elements with one another. It is a question, of how well organisational, environmental and individual issues fit to each other in certain situations.

These restrictions mentioned above call for versatility in research approaches. Even though measuring intrapreneurship may give us useful information and knowledge on the phenomenon studied, it leaves many other questions unanswered.

Therefore, it is suggested that the processes of intrapreneurial movements within organisations should be followed up and analysed more in detail and on a longitudinal basis.

The research and development activities within Small Business Institute present us with good possibilities for both measuring intrapreneurship at different stages of the different kinds of organisations, and then also following up and assessing the processes before, during and after training and development.

Triangulation between these sources of information is likely to deepen our understanding of the phenomenon of intrapreneurship. As this process takes some time, patience is needed, and also a certain passion for intrapreneurship.