Large companies need to encourage entrepreneurship, here is why

by Ashvini on January 21, 2013 · 10 comments

in Entrepreneurship

Large companies except a few are rarely known as entrepreneurial streak. The comfort of a huge market share, combined with strong balance sheet and dependency of customers often make large companies indifferent to idea of entrepreneurship.

Here are a few reasons why

  1. Hierarchical mind-set  of management
  2. Preference towards status quo
  3. Top heavy management
  4. Controlling style of management
  5. Organization lack of focus on innovation
  6. No incentives for those with entrepreneurial instinct
  7. Large bureaucracy
  8. Lack of entrepreneurial ecosystem

Here are the risks of not turning entrepreneurial

  1. Threat from agile smaller companies
  2. Threat from changing technology
  3. Effect of falling behind in exploring new market
  4. Attrition of enterprising workforce
  5. Threat from large companies who are innovating
  6. Loss of reputation with customers tuned to new technologies
  7. No development of new models and products ; reliance on old
  8. Slow loss of market share
  9. Ignoring new money making opportunities

Here’s how they can change

  1. Encourage entrepreneurship by fostering a winning culture
  2. Create performance programs aimed at innovation
  3. Spin off entities for new market development
  4. Make entrepreneurs and innovators answerable to board members
  5. Remove bureaucratic hurdles

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