The dynamism and complexity of organisations in the contemporary business environment with pervasive global reach endear companies to utilise or create competitive advantages that keep them afloat. The structure of an organisation is crucial for the control and management of its resources. However, the entrepreneurship necessary for a competitive edge and continued organisational growth demands flexibility in the structure of an organisation for it to take hold. However, companies eventually hit a development crisis after they have developed and matured and tapered into conservative and bureaucratic “dinosaurs” bereft of entrepreneurial energy as the primary source of sustainable financial feasibility (Greiner, 1972, p. 37-46; Churchill & Lewis, 1983, p. 35). According to Burns (2011), corporate entrepreneurship encompasses all entrepreneurship-related behaviours in existing, prominent corporations intended to enhance their competitive stance at all levels including “corporate, divisional, business unit, business functions and project teams” through innovation (p. 471). In essence, organisational structure plays a crucial role in building or discouraging entrepreneurship behaviours within corporate settings.
The locus of control, a psychological entrepreneurship theory, explains that the perceived impact of an individual’s intervention as regards an organisational problem in need of an innovative solution is a crucial indicator of entrepreneurial behaviour (Simpeh, 2011, p. 3). The formality that a bureaucratic structure of a corporation enforces does little to build ones internal locus of control due to its hierarchical nature. The lack of support from top management makes the impact of entrepreneurship individuals at mid- and low-level positions unnoticeable. Beheshtifar and Shariatifar (2013) indicate such lack of recognition takes away the desire to bring individual creativity to corporate solutions in work environments (p. 20). Alternatively, an organisation with an organic structure is fertile for innovation given the possibility for extensive vertical and lateral communication that is both informal and impromptu (Organisational Structures for Corporate Entrepreneurship, n.d., n.p). As such, the internal locus of control of individuals in such a corporation is empowered to enable entrepreneurship at the granular level of operation.
Moreover, the complexity of the organisational structure does little to encourage corporate entrepreneurship as it reduces the efficiency of utilisation of opportunities and resources. Hierarchical or multi-layered structures make it difficult to optimise on opportunities that present in the organisational environment. For instance, General Electronics’ new CEO, Jack Welch, sought to end such hierarchies by reducing the regulatory layers to effect “boundarylessness” and open communication lines to make decision making and delegation efficient (Organisational Structures for Corporate Entrepreneurship, n.d., n.p). In essence, the convolution of responsibilities, managerial tasks and communication does little to encourage corporate entrepreneurship due to the inhibition of group interaction (Beheshtifar & Shariatifar, 2013, p. 20). Therefore, it is crucial that an organisation embodies seamless communication. In such cases, entrepreneurship behaviours that are seated in the opportunity-based and resource-based entrepreneurship theories flourish, and an organisation can hedge its competitive position in the market with innovativeness without extra costs.
Other challenges are investing heavily in either bureaucratic or organic organisational structures. The former is conservative in its approach to corporate entrepreneurship while the latter exposes an organisation to large risk if left unchecked. Therefore, a blend of organisational structures is necessary, especially in large corporations, to optimise the perquisites of corporate entrepreneurship. Hence, the level at which corporate entrepreneurship is injected into the organisational structure should exhibit undoubted competence and responsibility. Situating the entrepreneurial responsibility at the corporate level is justified its level of creativity and innovation is beyond the existing level of business. As such, this could streamline the cost of business and limit the risks of uncertainty as the company grows (Organisational Structures for Corporate Entrepreneurship, n.d., n.p). The development of new services and products would thus be left to the reserve of corporate level personnel. Alternatively, entrepreneurial corporate ventures at the divisional level are efficient in cases where the various divisions are prominent and autonomous. The manager of each division will be perceptive of the profile of the customers it serves; therefore, they could customise their products or services to suit their respective clients (Organisational Structures for Corporate Entrepreneurship, n.d., n.p). Moreover, a blend of authority between corporate and divisional stakeholders is viable where a novel product or service bears an extensive risk, needing the short-term solutions provided by divisional managers while corporate managers handle the long-term factors that the new service or product presents. Nevertheless, such an organisational structure is likely to rouse more conflict than a purely bureaucratic or organic organisational structure due to lack of consensus (Organisational Structures for Corporate Entrepreneurship, n.d., n.p).
Sustainable performance of a business is a function of corporate entrepreneurship. However, as mentioned earlier, companies that are past the venture stage of development develop a degree of complacency and self-confidence that is deleterious to the effecting of change that leads to further growth (Paunovic & Dima, 2014, p. 271). Moreover, growing competition, the decreasing quality of leadership and lack of management with a vision to effect organisation growth through the revitalisation of organisation structure lead to the stagnation of corporate giants. Moreover, corporations have strained focus on their development objectives aside from revitalising their market, products and services, resources, operating systems, resources, management systems and organisational culture as is required in an entrepreneurial environment (Flamholts, 1990, pp. 336, 338-340).
The strain of having a large corporation thwarts entrepreneurship concomitantly without the management intending to do so. The costs of managing such organisations drown the considerations for the revitalisation of the various aspects listed in the previous paragraph. However, such reinvigoration does not guarantee the prioritisation of entrepreneurship as professional managers have a different framework for solving such problems as opposed to entrepreneurs. This challenge is manageable through the consideration of managers that have an entrepreneurial inclination in their decision-making (Paunovic & Dima, 2014, p. 271). Hence, they can integrate corporate entrepreneurship with the incentives and organisational culture in an organisational structure.
The momentum of the original entrepreneurial spirit that sets an organisation is rarely enough to handle the challenges that it will face in the future. Moreover, the individual that seeded the idea that led to the existence of an organisation can rarely replicate the entrepreneurial brilliance that amounted in the induction of numerous resources to perpetuate the goals of the corporation going forwards despite the unforeseen challenges. Hence, it would be strategic to induct a team that is entrepreneurially oriented to sustain the competitiveness of an organisation in a dynamic market (Paunovic & Dima, 2014, p. 272). Without a dynamic team, the competitive assertion of an organisation in the market is likely to dwindle. Hence, after the growth of a company to such levels that its success seems sustainable and its structure is stable, a company should revert to its entrepreneurial ways to remain afloat. This phenomenon is evident in global conglomerates that renew their entrepreneurial vigour with frequent product and service launches.
Notably, Apple is the most notorious for exhibiting an innovative front with annual product launches that seem pressured or unnecessary. However, the company maintains its leadership position in the smartphone and e-commerce aspects of its business owing to its drive for entrepreneurship despite its established market share. Under the leadership of Tim Cook, Apple Inc. has continued to dominate the mobile and computer market. Through the entrepreneurship skills spearheaded by the management, Apple has become among the leading companies in the production of laptops and smartphones. MacBook Pro and iPhone X are some of the latest releases by the company. Indeed, the company has invested many resources in the new products.
Moreover, Apple Company’s production strategy that sees 90% of its products generated in Asian companies has helped the firm to reduce the cost of operations. Tesla is a unique company in the American automotive and energy sector. The company specialises in the green technology. As concerns the Sustainable Development Goals, SDGs, the company has branded itself as environmentally friendly thereby gaining a huge market share for its corporate governance approach.
Nokia, AOL and BlockBuster among others are companies whose stagnation at the height of their success led to the loss of their competitiveness and eventual dissolution. Such organisations have different dynamics to their operation owing to their economies of scale; therefore, at the core of their structure should be a level of autonomy that allows for the solution of most of the wide variety of problems that they are faced with in their day-to-day operations as well as in their long-term existence. An organisational structure is paramount in decision-making. The established companies are managed through the board of directors with a Chief Executive Officer. The board of management is responsible for the management and success of the firms. Important decisions such as investment, business collaboration, and merging are done through the involvement of all the stakeholders. Moreover, the leaders in these companies are transformative which has helped the firms to teach the entrepreneurial skills.
Entrepreneurship skills are associated with focus, resilience, risk-taking, and the ability to converge consumer trends and universal needs. The long-term success of the world’s most profitable companies is associated with the entrepreneurial skills of the management or the founders. The founders of Microsoft Inc., Bill Gates and Paul Allen, have succeeded in introducing products in the market (Windows operating system) that is unique and not possible to duplicate by the competitors. The company has also taken risks in investing in the cloud business, Microsoft SQL Server, Windows Server, and Visual Studio which have helped the company to remain competitive in the electronic and technology sector.
A company’s organisational culture is crucial in the effecting of change as is frequent in an entrepreneurial environment. The anthropological entrepreneurship theory indicates that innovation is an effect of one’s culture. The behaviours that embody creativity and innovation are deeply seated in one’s cultural background. Hence, an organisational culture that incorporates all the factors that encourage entrepreneurship is ripe for innovation and creativity. A culture that is linked to an organisation is a feature that comes about due to the presence of values and criteria, with a tinge of incentives that enable it to flourish. It is crucial in the decision-making process as well as instilling a dynamic or static mind within the teams in an organisation based on its set up. According to Robbins et al. (2010), an organisational culture that enhances entrepreneurial effort is one that centres on improving the strengths of its personnel, focus on positive rather than negative reinforcement of its values and standards, and stresses on both organisational feasibility and personal growth of the members of its teams (p. 471-473). A culture of entrepreneurship encourages a receptive attitude towards change making the organisation pre-emptive rather than reactive towards negative forces.
Moreover, such tendencies enable a company to identify opportunities as they arise (Lockhead, 2008, p. 12). Reaction to changes is also efficient with entrepreneurial organisational cultures. At the core of such organisations is the optimisation of the value that the customers obtain from the company.
Another crucial element of an entrepreneurial organisation is the persistence acquisition of knowledge. A significant portion of organisational and individual growth is learning that hones the skills of systematic problem-solving. Further, the adoption of new frameworks of analysing and solving problems also adds to the advantage of such a culture. Alternatively, the past of a company is a crucial trove of information for finding the best and time-tested solutions for presenting problems. Moreover, the transfer of knowledge to colleagues enables the simultaneous improvement of the human resource.
The technological aspect of entrepreneurship also demands that an organisation be open to novel ideas, alternative options and extensive communication. Brainstorming on new ideas is a potent manner of obtaining the various options that are available to a corporation to solve a particular problem. The brainstorming teams bear the advantage of having streamlined means of having a level headed conservation. These innovative activities are extraneous to the regular business routines. Moreover, ensuring that the human resource at all levels is conversant with the latest technological developments is vital for maintaining such an organisational culture. The education of individuals on such technological advancements, however plenty, are an investment rather than a sunk cost that stands to give returns quicker than imagined. Equipping personnel with an entrepreneurial culture is paramount to having a highly ranked organisation with employees that are action-oriented and bold and competent enough to theorise and actualise a concept in practicality.
Moreover, an organisation structure that appreciates and builds on the potential of its employees is laden with out-of-the-box solutions to everyday and unique problems that it faces in its long-term existence. Knowing the individual strengths, knowledge, competencies and other qualities place an organisation at an advantage as it spears through the unknown future, as it can know where to put an individual when a challenge arises.
Besides, allowing room for failure within an organisation provides for the growth of entrepreneurship in corporate settings. Such a culture is not risk-averse and encourages the extensive calculation of, and hedging against risk. Failure to predict failure is not met with castigation; instead, an individual learns from the mistake and avoids a repeat of such instances. Such conditions allow for autonomy, open communications and commitment to a corporation. Hence, an organisation structure that is invested in entrepreneurship is crucial for the success of any corporation that hopes to retain long-term viability.
In conclusion, numerous theories postulate the conditions necessary for the thriving of entrepreneurship in an organisation. The level of control that an individual possesses in a corporation determines the degree of freedom that they have to effect changes in an organisation. A complex organisation structure makes it difficult to communicate and devolve resources efficiently to produce positive changes. Bureaucratic and multi-layered organisations present a challenge to innovative parties within an organisation that intended to effect positive change. An organic structure, nevertheless, with some level of control, is crucial to enable creativity to flourish for the benefit of a corporation. Maintaining creative power at the corporate level is efficient only if the product and service development is still new and prominent than the divisional and operational levels of business. This option is a cost-saving strategy. However, as such organisations grow, their entrepreneurial spirit becomes diluted as it rides on its original entrepreneurial genius until it becomes obsolete. A company should consider entrepreneurship oriented teams to build on the initial idea to avoid this stagnation. Existing corporate magnates like Apple and Microsoft show the effectiveness of such a strategy to the market dominance of a corporation. Block Buster and Nokia exemplify how the stagnation of a large corporation could amount to hard-hitting organisational lows that are not mendable. An entrepreneurial corporate culture is a crucial addition to a corporation to have positive growth in an organisation. This involves embracing technology, honing the strengths of the personnel, positive reinforcement and emboldening personnel to take risks would encourage entrepreneurship.