How can intrapreneurs stack the odds in their favor — so they shake things up productively, rather than just triggering a backlash?
David Gram, co-founder of the innovation consultancy Diplomatic Rebels, based in Denmark, has given that question a lot of thought. At the toymaker LEGO, he was an intrapreneur who helped launch the company’s first crowdsourcing initiative, CUUSOO (now known as LEGO Ideas), as well as LEGO’s first hybrid digital/physical product, “Life of George.” He also helped to shape LEGO Ventures, a separate investment group, and previously served as Head of Innovation at Scandinavian Airlines.
Gram shared the slide below, laying out five essential habits of the successful corporate intrapreneur. In an interview, he provided more details on each habit, and offered his advice on creating the right conditions for intrapreneuship to take root in an established organization.
- People will hate your project. Accept it. Often, two things happen to intrapreneurs. Either they give up and do as they’re told, or they burn out and leave, because the resistance is so strong. Those that burn out typically take the resistance personally: “It’s them against me — they don’t want me to succeed.” You need to accept that there will be resistance. It’s basic human nature, the fear of the unknown. People wonder, “What will happen to my role and career if this new thing happens?” You need to understand that and have empathy for it.
- Only break the rules you understand. Obviously, you’ll be breaking rules, both formal and informal. (The informal stuff can be trickier.) By understanding why these rules were there in the first place; who built them; and for what reasons, you can build the narrative and the story of why you need different rules, and different ways of working to do new things. That understanding can help you onboard people from Finance, Legal, Procurement, Compliance. They are the gatekeepers who want things to stay as they are. They want there to be no flaws, no risks, no mistakes.
- Build a tribe. Look at your project more like a movement within the organization. You want to start identifying the people you need to get on board, the people who need to be part of what you’re doing. The role of the intrapreneur is unfortunately not just creating new products and experiences; it is driving cultural change within the organization, allowing even those giving you resistance to somehow be part of the change.
At LEGO, one of the things we did was create a couple of hot desks for people from Finance, Legal, and Procurement, and invited them to sit with us. They started talking together: “What are the right KPIs for a department like this?” Typically, the young people in these units wanted to be there. We started building strong relationships with them, and they started innovating on their tools and methods to keep up with us.
We also discovered that each project needed its own tribe — people who got passionate around what we were trying to do. The teams had to spend some time getting the story and the narrative to have an emotional aspect to it, because that gets people committed [in a stronger way than] just the hard facts.
One project I ran was [a mobile app that interacted with a set of LEGO bricks called “Life of George.”] The character is this quirky guy George, and he just became the coolest guy within the company. We did a lot of events in the company that had no connection to the business; we had t-shirts and merchandise, and we also would throw a party like George would throw a party. Whenever there was a speech, announcement, or quarterly review, we’d do it like we were speaking on behalf of George. It helped to build a tribe around this guy.
- Write love letters. You need to quite literally write love letters. Be very humble, very forthcoming, and respectful. It is the existing business paying your salary – you’re standing on the shoulders of giants, looking into the future. You want to make sure that comes across, that the other guys are not just idiots. The thing you can start doing tomorrow is, you always know who the folks are who might be challenging, or resisting, what you’re doing. You know who you should reach out to, but you don’t. So how can you write an email, or talk to them in a way that is really kind, really inviting? We had one project manager who always carried chocolates in his bag. He would give them out to colleagues: “I was just in Switzerland, and I thought of you.” That stuff works. People think, “That guy actually likes me, even if I’m giving him shit.”
- Make people shine. This is the most fun part, really. You need to make sure that once you hit something that is successful, you make sure that everyone shines – even those guys who were giving you resistance, but are still supporting you, even if they might be doing it reluctantly. You want to make sure that they get some credit. With Life of George, one of the things we did was create these awards. We sprayed George gold on a pedestal, so he looked like the Oscar statuette, and gave it to 20 to 30 people who had done the most for the project — people who pulled extra hours, worked at night. Each of them found this beautifully wrapped package. The statuette had their name, and “George says you’re awesome” on it.
What Creates the Right Conditions for Intrapreneurship?
Often, the organizations that seem to be able to do this have either an ownership or top leadership understanding that somehow the leaders need to be ambidextrous in the way that they lead. With one hand, they need to manage the existing business really well, but do equally well at supporting exploration of new business. They should not compare these two and measure them against each other, or force-fit these two activities into the same processes and templates. Companies that look at new initiatives and say, “How soon can we stuff it into the existing process?” — that is where things will fail, have no oxygen, and be shut down too quick.
I’ve concluded the best way to do this is to legally separate the entities that are doing this. You are seeking synergies and collaborations, but you are independent, so that top management cannot have relapses — “We need the cash to put out these fires that are in the existing business” — and they temporarily shut it down or completely shut it down. Separate entities allow you to explore the future of business, and build the right capabilities, alongside exploiting what you’ve already built.
Three Levels of Innovation
In my model, I typically describe three levels of innovation that need to happen in any organization. Level 1 is the continuous improvement and refreshment of the existing business. The second level is where you innovate on the edges of the existing core business — it can be digitization, but still within the same operating model. Those first two levels can happen within the same legal structure. The third level is diversification, radical innovation — what if our business is disrupted? Typically, there is a different business model. With that level, you need to have in a separate entity and unit, otherwise the immune system will kill it.
The LEGO Future Lab was that second level. LEGO Ventures was that third — it is a separate business, following a structure like what Google did with Alphabet. Instead of everything flowing through Google, we can do independent things. LEGO Ventures is under that umbrella. You have the mothership next to it, and as Ventures gives birth to things, it’s as new startups, in the same ecosystem and with the same mission.
What It Takes to Support Intrapreneurship
Companies that have a private owner, or are led by someone who is not just looking at optimizing short-term returns are better suited to building an intrapreneurial culture. It’s very difficult; relapses will happen frequently. I’ve spoken to VPs driving innovation units who say, “This is all great until the point where there’s a crisis in the existing business, and everything is shut down.”
Creating a Career Path for Intrapreneurs
You need to legitimize the intrapreneur’s career path and the way of working. That only happens by having a separate way of measuring performance and value creation. It goes back to that ambidextrous organization. In many companies, they’re living in the shadows of that other system, and they’re not really recognized. They need to be legitimized. You need to show, “This is a career path.” They can become Chief Digital Officers, or transformation officers, because they know how to handle ambiguity, new technologies, new business models. These are highly-skilled people with a lot of C-level potential. But because they don’t go the normal way up, in many organizations, they’re having a hard time.
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