Transform the company with entrepreneurship and mitigate corporate hacking

In this post I will try to elaborate around two big trends for corporate innovation: intrapreneurship and corporate hacking. On my opinion the difference between both concepts is that intrapreneurship is a top down effort defined from the head of strategy and multiplied to the different departments following a well defined process in order to realize the company’s transformation. Oppositely corporate hacking is a bottom up approach starting from self organized groups of employees who adopt methods from outside the company to accelerate its development.

Giving directions in preparation and learning from the path

First, we can look at intrapreneurship. More than discovering the next big thing in the company, intrapreneurship is a way to change the culture and reward new behaviors in the company. Transforming the company is a global effort that requires multiples contributions at every levels. On my opinion, two of the entrepreneurs skills that benefit the company’s innovation are the persistence and capacity to take risks. With persistence, employees are likely to accept failure and bounce back from the several obstacles they will find on the path to success. Corporation have very little acceptance of failure and the employee performance system does not reflect the number of iterations of develop/test/learn required to come to a successful new product. In other words, on a yearly performance evaluation system, developing one or two iterations that lead to failure will deprive employee from his bonus and will certainly reduce his willingness to try harder and come to the next two iterations that leads to a successful product. Another key skill from entrepreneur is the ability to seize calculated risks and take actions. Moving the company forward is a challenge, in particular transforming by adding new methods and mindset. The capacity to take decision and execute is a great asset and entrepreneurs mitigate risks with a constant evaluation of the actions. Having the right metrics and flexibility allow them to adapt and correct trajectories.

Therefore, general tendency in corporations is to have people looking for quick wins, solving things on the surface, communicating, getting rewarded and moving on (see people staying 18 months in a role). Unfortunately this does not help to develop their persistence. Oppositely, people with entrepreneurial mindset will accept losing on the short-term, solve problems from their foundations, pivot until having sustainable revenue model.

Therefore, transformation toward entrepreneurship is a top down approach providing a supporting environment, culture, incentive and tools. This is the mission of the corporate innovation center, both from the creativity space and the business incubator.

The lack of clarity in managing the transformation of the company can leave some space for independent employees to take action. Interestingly, those are the one with entrepreneurial mindset and it explains why sometime corporation are reluctant to hire ex entrepreneurs.

The corporate hacking is a growing trend with several papers describing how employees for the good of the company decide to bypass processes and deny rules. The question for corporations is on how to convert this goodwill and untapped resource into an opportunity to transform the company.

An example in a company would be to start using whatsapp or slack to organize a taskforce around a particular project. Result is both instant and direct communication that also has the advantage to cut down the hierarchical dimension. Such a tool allows an intern to react on a VP comment without having to use any verbose… here the project gain in transparency. Another example consist in bringing-in an external expert to influence management to follow a new strategy. This can even work better having an external expert recognition first … such as an innovation award from a scientific society. In other words Corporate Hacking use tools or external factors to the company to legitimate action that will not have support from the management for inside and therefore bypass the hierarchy as they don’t have any control on the tools or outside factors.

Corporate Hacking bottom-up transformation of the company usually take place if the top down approach is non-existing or too much constrained. Despite that the ambition of corporate hacking is to build a better and more competitive company, it puts the organization in danger. To mitigate this effort it is important to recognize its value and offer it a safe place. I like an analogy from DCNS a marine construction company: “We don’t want pirates but we value corsairs”. My recommendation would be to build an official corporate hacking observatory under the head of strategy and with regular review of the trends and practices developed.