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How businesses can foster an enabling environment that unlocks the potential of social intrapreneurs to drive commercial and social innovation? We recently held two online discussions to explore this question as part of the Inclusive Business Boost series funded by DFID.
Building on the “The Intrapreneurship Ecosystem: Creating the conditions for social innovation to flourish in your company,” a business guide produced by Business Fights Poverty and The League of Intrapreneurs (LOI) with support from the UK’s Department for International Development (DFID), CEMEX, and the BMW Foundation, we recently held two online discussions. A panel of experts was convened to share key insights and learnings:
The power of purpose
Florencia Estrade of The League of Intrapreneurs (LOI) explained how aligning core business and social innovation can motivate an entire company, rather than having the niche of the “social innovators”.. For Unilever, for example, leaning on their enduring purpose at corporate level of “making sustainable living commonplace” across their brands, is key, according to Dr. Clive Allison.
Companies also need to connect purpose with a range of measures that make it real for the employees, said Tom Harrison of the Business Innovation Facility (BOF). “This may mean that inclusive business needs to have unique performance metrics and investment criteria for projects that deliver against the company’s purpose.”
From Return on Investment (ROI) to Return on Purpose (ROP)
Too often companies are forced to report on traditional business metrics, whereas Hamzah Sarwar argued for a “holistic” or “Return on Purpose” measurement system to prove that social intrapreneurship accelerate business value. There is a need to evaluate innovative initiatives on far broader terms and see things like employee engagement, leadership development, brand benefits, and having strategic footholds in new markets as important as hard dollars, added Bulloch.
Maggie De Pree of LOI also highlighted the role of policy in shifting incentives, “What if companies and shareholders were legally accountable for achieving mission and impact alongside profit?” BCorp and other innovative companies are putting pressure in this space.
One leading company in this space, Barclays, sees “profit” as just one part of the ROI metrics, pointed Daniel Fernandez Alvarez. “Therefore, when we report on our propositions we also report on their social impact, brand impact, client engagement and colleague engagement,” he added.
Innovation starts with people
Innovation starts with people, said RB’s Hamzah Sarwar. “They have to believe that they will be heard and their ideas listened to irrespective of their functional role or seniority...it begins by companies building an inclusive culture where ideas can be incubated, treated with care without scrutiny and worked up into something meaningful.” Indeed, research among leading companies shows that employees are one of the biggest sources of innovation. Companies can optimize this resource by building capabilities for innovation, and developing rewards and incentives that encourage creativity and experimentation. It is important to have a performance management system that rewards behaviors and attitudes over just outcomes, and where failure is seen as a source of learning, pointed out veteran intrapreneur, Gib Bulloch.
Beyond time capacity limitations, employees KPIs don’t take into account social innovation, added Kaplan. Intrapeneurs need to be given time and space, and be actively supported in their efforts to ideate. Bulloch says that firms need to quash the notion that this work is ‘extracurricular’ and celebrate it as a core tenet of any role.
Empower the “middle”
While setting “tone at the top” with board, CEO and executive teams is a necessary step, grassroots engagement (and leadership) from employees, partners and customers is key to driving innovation, argued Pearson’s Paul Ellingstad. “Don’t forget about the middle,” he added. De Pree concurred that for years people have talked about the mid-level clay layer as a key barrier to Intrapreneurship. “But what if we flipped this around and asked how this mid-level could become an enabling layer? We came across many inspiring examples in our research and would be awesome if this fed into business school and executive education curricula,” she added.
To address the issue of stifling the innovation with “day work” demands, Sarwar noted that he launched a reverse mentorship scheme with C-Suite on driving social impact and cultural shift required. “First thing that has come up is how to break this notion amongst mid-management.”
The missing framework
Innovation is easier to do when it is close to the core business model for the simple reason that business cases and relevant resources are readily available, said Allison. “Challenges such as understanding the size of the prize (business and impact case) and developing the business model, which may be different from the core business, increase with distance from the core and level of market disruption (uncertainty),” he added.
Harrison referenced The Intrapreneur Lab Ventures, highlighting that social initiatives need to be owned in the place that best matches organizational priorities. What is missing is the institutional framework or common language for social Intrapreneurship and social innovation, pointed out De Pree. She added that one idea was to situate an intrapreneur within relevant business unit but then have investment come from sources like innovation funds.
The power of radical collaboration
Decentralization of power in organizations as well as the fostering of new types of collaborations across traditional boundaries are fundamental for unlocking social innovation. “We’re starting to talk about collaboration IQ as a real competence that needs investment,” said De Pree. Silos need to be broken-down to allow for collaboration, companies need to support this ‘title-less’ mindset where anyone can be a part of the solution, agreed Sarwar.
The experience from Barclays is that it is necessary to have a co-creative approach to developing new products, one that allows all stakeholders within the business to input into the design process, said Fernandez-Alvarez. He added that it is just as important to bring the beneficiaries of the product from the beginning into the process. “The people and communities must be involved from the beginning to ensure the success of the product.”
There are good examples to learn from
Like social entrepreneurs, intrapreneurs need a healthy ecosystem to survive and thrive. Companies that take a holistic approach and invest across the four key components of the internal Intrapreneurship “ecosystem” as uncovered by the research—Purpose beyond Profit, People as Change Agents, Power of We and the Generative Pipeline—are more likely to see social innovation not only spark, but scale. Company initiatives like CEMEX Ventures, Pearson’s Tomorrow’s Markets Incubator, Barclay’s Social Innovation Facility, Danone Communities, Unilever’s TRANSFORM initiative with DFID are at the forefront of corporate social innovation. To learn more about these initiatives and our research findings based on the input of over 90 intrapreneurs, please take a look at: ‘The Intrapreneurship Ecosystem: Creating the Conditions for Social Innovation to Flourish in your Company’, and learn more about DFID’s wider programme, Inclusive Business Boost
Join us for a live written discussion with a panel of experts to explore when corporates should be investing in inclusive business solutions. This live discussion will take place on Thursday 5th September 2019, 15:00-16:00pm BST (10:00-11:00am EDT). Click here for more details.
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