Peanuts for Profit: Why Intrapreneurs Need Better Rewards
Stephen Parkins
Systematic Innovation & Strategic Growth for companies who need to show ROI ?? Renewable Energy Investments???? Agentic AI business simulations ??? I help leaders bridge the gap between innovation strategy and execution
?? Read time: 3 minutes /
If we believe that today's corporate business models are under threat from all angles, then intrapreneurs are the bright minds who may just succeed in steering their companies towards a brighter, more innovative future.
Quite simply, intrapreneurs are the entrepreneurial minds on the inside of an organisation.
Tasked with transforming dinosaur organisations and creating new revenue streams in competitive markets, the expectations riding on intrapreneurs are immense.
However, is the sheer excitement of innovating a sufficient incentive?
Let's explore why more tangible incentives are crucial —and urgent— for sustaining intrapreneurial energy inside any big company.
1. Recognise the risks
On one occasion when I floated the idea of variable compensation for intrapreneurs with an HR manager, he replied “but they’re not taking any risk.”
To put it politely, he couldn’t have been more wrong.
Intrapreneurs tread uncharted waters every day, risking their professional reputation on projects that may or may not see the light of day.
Most of their babies will get killed — they just don’t know when, or by whom.
Unlike non-corporate entrepreneurs, who put their personal finances on the line to launch an AI startup or open a vegan restaurant, intrapreneurs risk something different but no less valuable: their professional standing.
To claim that intrapreneurs have no skin-in-the-game, is to misunderstand the nature of their work.
As risk takers, I believe they should be rewarded accordingly.
The promise of a pat on the back or the thrill of the journey seems a tad underwhelming. Even insulting.
2. The talent drain dilemma
Almost every intrapreneur I’ve met has shared 2 traits:
If intrapreneurs perceive that their efforts aren't aptly rewarded, the temptation to walk away intensifies.
One obvious exit is if the grass seems greener on the pure entrepreneurial side, where the financial upside of innovation can be monumental.
Alternatively, rival companies that appreciate innovation with more than just applause become appealing.
The result in both cases? A drain of the very talent you've cultivated.
On the plus side, you now have an amazing alumni network. Unfortunately, they’re now all applying their amazing talents elsewhere.
3. Innovation and investment go hand-in-hand
It's obvious that innovation requires investment.
But it’s not just about financial investment in the development and marketing of innovation projects. It’s also about investing in the people driving that innovation.
If a company can allocate budget for innovation, it's only logical they earmark a portion to reward those who bring such innovation to fruition.?
?? Tip: Introduce a clear bonus structure, based on metrics that are tied directly to both inputs and outputs of the company’s innovation portfolio. (Linking bonuses to the outcome of an individual project creates perverse incentives, such as leading teams to ignore data they don’t want to hear.)
?? Tip: Offer stock options or shares of the company, aligning the intrapreneur’s personal success with the long-term prosperity of the company.
领英推荐
4. Driving the extra mile
With the right financial incentives, intrapreneurs are more inclined to push boundaries and explore bolder ideas.
But it’s not just about the money. Financial recognition brings an emotional and psychological reward.
When intrapreneurs are publicly acknowledged for their work, it instils a sense of pride and accomplishment. This recognition resonates on a deeply personal level, fulfilling our intrinsic human need for validation and appreciation.
When combined, financial rewards and recognition create a synergy, fuelling intrapreneurs with both external and internal motivation.
They don't just work for the potential monetary benefit; they're driven by the prospect of their efforts being seen, acknowledged, and celebrated.
If they see a direct correlation between their efforts and their rewards, they push themselves to think bigger and act more decisively.
?? Tip: Schedule regular check-ins with intrapreneurs, ensuring they have the resources and motivation to venture into new territories.
?? Tip: Create an 'Innovation Champion' award on a quarterly basis to spotlight and reward exceptional intrapreneurial efforts.
5. Create a culture of value creation
When employees witness intrapreneurs being tangibly rewarded for their efforts, it encourages a culture where value creation is championed.
Employees across the board become more inclined to think outside of their narrow remits, knowing that their efforts will earn them more a nod.
They’re also far more likely to apply for intrapreneur positions internally, thereby creating a much deeper talent pool to draw from.
?? Tip: Host regular 'Innovation Showcases', to allow employees to present novel ideas while at the same time serving as a recruitment event for potential intrapreneurs.
?? Tip: Implement a 'refer an innovator' scheme, offering rewards to employees who refer potential intrapreneurs to the organisation.
Conclusion
In conclusion, if we genuinely want to encourage a culture of innovation, we need to back it up with more than just nice words.
True innovation deserves true recognition. And there's no better way to show appreciation than by sharing the spoils of success with those who take risks.
After all, we’re not playing Innovation Theatre. We’re asking intrapreneurs to reinvent our organisations and generate revenue that will recur for years to come.
I don’t believe that a five-figure flat salary will cut it.
???This is my bi-weekly newsletter in which I share original insights and tips on building a healthy culture of innovation.?Subscribe to Culture for Lunch?to get notified each time a new article is published.
I hope you found this article valuable.
If you received it by email, you can forward it to a friend or colleague.
If you are reading it on LinkedIn, please hit the like (??) or repost (??) button to help me reach more readers like yourself.
Thank you for reading and enjoy your lunch,
Stephen
COO at Seedstars (We're hiring!)
1 年I'd love to see more concrete examples of good practices and successful ways to structure incentives for intrapreneurs. Any companies doing this successfully that you'd highlight?
Piloter l’innovation dans l’industrie 4.0 | Accélérer l’innovation par la connectivité, le jumeau numérique et l’IA | Combiner le monde réel et le digital
1 年This is a very important matter rarely discussed, thanks for bringing it to light. ?? Definitely, large coporations struggle to efficiently manage innovators and intrapreneurs. Most of companies want people with entrepreneurial skills without knowing exactly what this means and what it requires from the organisation to be able to set up a favorable context for them to work. The tips you give in this article are very interesting. To continue the discussion on risk, the most dangerous predator of innovators is company's culture. Innovate within a corporation is like playing the game of cat and mouse: innovators are hunted by company's culture. An organization acts like a living being's immune system: it will fight anything that challenges its ways of doing things. As soon as your innovation is detected, it automatically becomes a foreign body that needs to be removed. This game is highly risky, more than we can imagine. No matter how many project assassination attempts the innovator manages to thwart, it only takes one for the project to die. I've seen many innovators end up totally exhausted and sickened of large corporation processes. This is often the 1st reason they give me when I ask them why they left their organization.
Pricing for PE-backed B2B SaaS | Creator of “Pricing from the Start” framework
1 年Could you elaborate on the personal reputation risk, how it’s a unique risk to intrapreneurs isn’t obvious.
Chief Investment Officer @ Cadro | Non Executive Director @ Risk | External Investment Committee Member @ Wealthify | CFA, CAIA, Financial Risk Manager
1 年Also depends on the risk they're taking. If you're in a safe environment where you can try new and interesting (or boring) ideas with no fear of short-termism then maybe it's similar to any other corporate role. But if ?intrapreneurs face the downside with little of the upside, they may as well leave for a start-up or a more risk-loving firm.