One more time about “innovation terminology”

In a recent HBR article, Scott Kirsner suggests ditching the term “corporate entrepreneur.”

Kirsner names a number of reasons why corporate innovation, especially in large firms, is different from true entrepreneurship. One is bureaucratic shackles that restrict the development of new big ideas in a corporation; another is an obsession with short-term performance goals that prevents large companies from pursuing risky long-term projects. Kirsner goes as far as to argue that using the very term “entrepreneur” would set up corporate innovators for failure in a large organization.

Although I agree with Kirsner that the term “corporate entrepreneur” (along with, I would add, the equally ambiguous term “intrapreneur”) is more confusing than clarifying, just getting rid of it will not help cure the maladies of corporate innovation.

The real problem with corporate innovation is that some corporate leaders are still unsure what innovation really is. Many organizations have no working definition of what innovation means for them, and corporate innovation is routinely equated with occasional “idea generation” campaigns.

There is a widespread lack of understanding of the difference between incremental, adjacent and transformational innovation (a.k.a. the 3-Horizon Model of Innovation); very few are familiar with the concept of Integrative Innovation Management. Many corporate innovators sincerely believe that every innovation must be “disruptive” and that all other types of it are for losers.

There is simply no reason to invoke “corporate entrepreneurship” when operating within the borders of incremental and adjacent innovation; the needs of these two types of innovation can be adequately addressed by the conventional product development processes augmented, if needed, by open innovation approaches, such as customer co-creation.

It’s only when organizations deal with transformational innovation do they really need an infusion of “entrepreneurial” spirit. However, the best way of doing that would be by engaging startups, the entities that are being created for the sole purpose of transformational change of the existing technology and business landscape. By engaging startups, organizations would “hire” the very people capable of challenging the corporate status quo–without going through a murky process of creating “corporate entrepreneurship.”

The bottom line is that corporate innovation requires strategy, governance, processes, and control. Replacing the basics with catchy buzzwords won’t cut it.

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About Eugene Ivanov

Eugene Ivanov is the Founder of (WoC)2, an innovation consultancy that helps organizations extract maximum value from the wisdom of crowds by coordinated use of internal and external crowdsourcing.
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