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Article
Publication date: 7 August 2009

Yi‐Fen Huang

The purpose of this paper is to develop an understanding of the effects of existing capabilities, by exploration and exploitation, on the choice between internal corporate

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Abstract

Purpose

The purpose of this paper is to develop an understanding of the effects of existing capabilities, by exploration and exploitation, on the choice between internal corporate venturing and external corporate venturing.

Design/methodology/approach

Data from 259 Taiwanese firms in the information technology (IT) sector are collected. The study period is four years: 2003 to 2006. Information on corporate financial data and new ventures from the Taiwan Economic Journal (TEJ) database are collected, as well as patent information from the Taiwan Intellectual Property Office (TIPO). Poisson regression is used to test the hypotheses.

Findings

There exists a positive relationship between a firm's existing capabilities and corporate venturing activities. The findings indicate that exploration is a better predictor of internal corporate venturing, while exploitation is better at predicting external corporate venturing.

Research limitations/implications

Empirical results are derived from a sampling of information technology firms in Taiwan thus raising issues about their generalizability to other empirical contexts.

Practical implications

That internal and external corporate venturing could be complementary is clarified; meaning that each could contribute to a particular type of strategic renewal. For firms that engaged much more in exploration, internal corporate venturing is a better for growth than external corporate venturing; it can leverage existing technologies and keep valuable breakthrough technologies in‐house. In contrast, for firms that focus much more on exploitation, learning externally is a better renewal strategy than venturing internally; it can access and integrate resources trans‐organizationally to create novelty that may serve as avenues for further growth.

Originality/value

This is the first study that compares the effects of exploration and exploitation with regard to the decision to engage in internal or external corporate venturing.

Details

International Journal of Entrepreneurial Behavior & Research, vol. 15 no. 5
Type: Research Article
ISSN: 1355-2554

Keywords

Article
Publication date: 19 November 2008

Stephen K. Callaway

Two hot topics today in the popular press as well as academic literature are international entrepreneurship and corporate entrepreneurship. These topics challenge two traditional…

1066

Abstract

Two hot topics today in the popular press as well as academic literature are international entrepreneurship and corporate entrepreneurship. These topics challenge two traditional notions within those fields: the difficulty of established corporations to be entrepreneurial and the difficulty of entrepreneurs to go global. The current study introduces the concept global corporate ventures, which merges the concepts internal corporate ventures and “born globals.” This concept is developed and illustrated by two examples of global corporate ventures, ING Direct and HSBC Direct, two financial services e‐commerce ventures that have been launched on a global scale.

Details

Multinational Business Review, vol. 16 no. 3
Type: Research Article
ISSN: 1525-383X

Keywords

Book part
Publication date: 8 July 2010

Marina G. Biniari

Corporate venturing initiatives, which exemplify corporate entrepreneurial behavior, follow an evolutionary path of variation, selection, and retention. While their external…

Abstract

Corporate venturing initiatives, which exemplify corporate entrepreneurial behavior, follow an evolutionary path of variation, selection, and retention. While their external selection is a consequence of their performance, their internal selection is subject to forces of complementarity and legitimacy, and how well competition from other initiatives is overcome. This chapter aims to unfold the dynamics of the internal selection process of initiatives, focusing on its emotional dimensions. Assuming that organizational agents have a deliberate role in guiding the internal selection process of initiatives, the chapter examines how organizational agents' emotional dynamics influence this process. The chapter draws its theoretical basis from the intraorganizational evolutionary perspective and the literature on emotions in organizations. The case of a corporate venturing initiative and the narratives of four managers involved directly and indirectly in the initiative are used to illustrate how the emotional dynamics of organizational members evoked envy toward a venturing initiative and directly impacted its degree of competition and complementarity with other interacting initiatives, ultimately hampering its selection.

Details

Emotions and Organizational Dynamism
Type: Book
ISBN: 978-0-85724-177-1

Article
Publication date: 1 June 2006

Rajagopal

The purpose of this research is aimed at discussing the external and internal strategic fit in corporate ventures in Latin America.

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Abstract

Purpose

The purpose of this research is aimed at discussing the external and internal strategic fit in corporate ventures in Latin America.

Design/methodology/approach

This study is based on empirical investigation through semi‐structured interviews administered to the managers of multinational companies operating in Mexico. The success of the corporate ventures in Mexico has been evaluated from the perspectives of economic and relational attributes. The results of the study showed that the degree of fit between a corporate parent and venture affects the success of the venture. The success is associated with high levels of commitment, competitive skills and dynamics in the functional management of the venture. In this study the variables of economic and relational dimensions of external and internal fit have shown greater association with venture success. It has also been found that ventures opt for greater autonomy and less economic dependency with their parent ventures for leading success and these findings make an intuitive sense.

Findings

The study may have limitations on generalizing some of the findings because of the survey type study.

Research limitations/implications

Corporate venturing as a strategy for international business development has become significant in view of the process of globalization resulting in free trade and business development opportunities for multinational companies. This study provides an understanding of the venture managers to succeed in Latin American business environments in view of the organizational culture and employee behaviour.

Practical implications

This paper is based on the economic and behavioural indicators affecting strategic fit in the corporate venture.

Originality/value

This paper would contribute to important areas in Latin American business where such studies are scarce.

Details

Management Decision, vol. 44 no. 5
Type: Research Article
ISSN: 0025-1747

Keywords

Book part
Publication date: 22 November 2018

Minet Schindehutte, Michael H. Morris and Donald F. Kuratko

The present study examines entrepreneurship in established firms holistically and critically. The authors start by reviewing previous research and highlight a variety of…

Abstract

The present study examines entrepreneurship in established firms holistically and critically. The authors start by reviewing previous research and highlight a variety of definitional, conceptual, methodological, contextual, and temporal factors that have been confounding the research. The authors then present a multidimensional framework that specifies a more nuanced picture of the determinants, motives, activities, and consequences of corporate in established firms. Finally, the authors discuss conceptual, methodological, and practical implications, as well as outline future research avenues.

Details

The Challenges of Corporate Entrepreneurship in the Disruptive Age
Type: Book
ISBN: 978-1-78754-443-7

Keywords

Article
Publication date: 11 September 2007

L. Gregory Henley

The purpose of this article is to describe how investing in entrepreneurial ventures can help large firms pursue corporate entrepreneurship initiates. Ventures can be attractive

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Abstract

Purpose

The purpose of this article is to describe how investing in entrepreneurial ventures can help large firms pursue corporate entrepreneurship initiates. Ventures can be attractive partners due to their ability to provide a disproportionate share of radical innovations.

Design/methodology/approach

Based on existing literature and information collected via 45 surveys and 72 interviews, the paper shows that strategic fit is an important variable that determines the type of benefits ventures can provide to investing firms.

Findings

Three benefits large firms can reap from investing in ventures are: managing the risks and uncertainties of innovation; learning from the venture; and increasing bargaining power over ventures that supply innovative products.

Research limitations/implications

Existing research does not go far enough to explain the range of benefits corporate venture capital can provide. The majority of investments were found in ventures that sell innovative products to the investing firm and have technological competences different from the investing firm.

Practical implications

Organizing for innovation is often a challenge for large firms. Because ventures may be more effective when started outside the firm than inside, investing in select entrepreneurial ventures can help firms effectively explore for radical innovation while continuing to exploit their existing resources internally.

Originality/value

For corporate strategists concerned about improving their firm's innovativeness, corporate venture capital can be part of a corporate entrepreneurship toolbox that can help augment a large firm's growth and competitive position. It can be particularly helpful in managing the risks and uncertainties inherent with radical innovation.

Details

Journal of Business Strategy, vol. 28 no. 5
Type: Research Article
ISSN: 0275-6668

Keywords

Article
Publication date: 11 May 2012

Ellen Enkel and Sanjay Goel

Since corporate ventures operate under the organizational conditions of a parent company, this article aims to highlight key conditions influencing the success of a new venture.

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Abstract

Purpose

Since corporate ventures operate under the organizational conditions of a parent company, this article aims to highlight key conditions influencing the success of a new venture.

Design/methodology/approach

Two cases of corporate venturing are analyzed regarding their performance since they are characterized by different conditions within one international consumer‐goods company. Hence, the literature on corporate entrepreneurship is reviewed and combined with a case study to explore the role and drivers of organizational conditions in the inception and development of new corporate ventures.

Findings

The case study reveals two key organizational differences pertaining to corporate new ventures — procedural clarity and procedural discipline. These differences mitigate the variety of risks that corporate entrepreneurs face and smooth or hinder their way to evolve their venture from ideas to business.

Research limitations/implications

As the study includes two venturing cases within the same company in the fast moving consumer goods industry (FMCG), the findings are so far limited to the characteristics of this company type and its sector.

Practical implications

This article supports mid‐level managers to run corporate ventures more successfully by introducing a clear action plan with well defined phases. Individual managers' impact should be limited and linked to a more objective network‐structure.

Originality/value

In contrast to previous literature, this paper highlights the influence of organizational conditions under which corporate ventures are initiated and operated. Additionally, there are further factors identified, the ventures' internal visibility, and the knowledge support by the parent company, which will influence the venture's success or failure.

Details

Journal of Business Strategy, vol. 33 no. 3
Type: Research Article
ISSN: 0275-6668

Keywords

Book part
Publication date: 22 November 2018

Donald F. Kuratko and Emily Neubert

A corporate entrepreneurship (CE) strategy implies that a firm’s strategic intent is to continuously leverage entrepreneurial opportunities for growth- and advantage-seeking…

Abstract

A corporate entrepreneurship (CE) strategy implies that a firm’s strategic intent is to continuously leverage entrepreneurial opportunities for growth- and advantage-seeking purposes. CE has gained greater research attention with a focus on the factors that influence an organization’s willingness to initiate and sustain a CE strategy. In the current disruptive age, firms acknowledge the importance of CE (also referred to as corporate innovation) as the critical element for sustained competitive advantage in the global economy. Yet, so many organizations struggle with the actual implementation of an innovative strategy. There are key challenges that must be addressed by today’s corporate entrepreneurial leaders in this age of disruptive innovation. These include framing the innovation, developing the internal architecture, coordinating the managerial levels, integrating design thinking, recognizing the grief associated with project failure, and demanding ethical standards. As research on corporate innovative activity has evolved, numerous researchers have acknowledged the importance of these leadership activities to enhance the effectiveness of corporate entrepreneurial activity. In this chapter, the authors discuss these critical elements confronting corporate entrepreneurial leaders.

Details

The Challenges of Corporate Entrepreneurship in the Disruptive Age
Type: Book
ISBN: 978-1-78754-443-7

Keywords

Article
Publication date: 8 June 2020

Robert Garrett, Shaunn Mattingly, Jeff Hornsby and Alireza Aghaey

The purpose of this study is to evaluate the effect of opportunity relatedness and uncertainty on the decision of a corporate entrepreneur to pursue a venturing opportunity.

Abstract

Purpose

The purpose of this study is to evaluate the effect of opportunity relatedness and uncertainty on the decision of a corporate entrepreneur to pursue a venturing opportunity.

Design/methodology/approach

The study uses a conjoint experimental design to reveal the structure of respondents' decision policies. Data were gathered from 47 useable replies from corporate entrepreneurs and were analyzed with hierarchical linear modeling (HLM).

Findings

Results show that product relatedness, market relatedness, perceived certainty about expected outcomes and slack resources all have a positive effect on the willingness of a corporate entrepreneur to pursue a new venture idea. Moreover, slack was found to diminish the positive effect of product relatedness on the likelihood to pursue a venturing opportunity.

Practical implications

By providing a better understanding of decision-making schemas of corporate entrepreneurs, the findings of this study help improve the practice of entrepreneurship at the organizational level. In order to make more accurate opportunity assessments, corporate entrepreneurs need to be aware of their cognitive strategies and need to factor in the salient criteria affecting such assessments.

Originality/value

This paper adds to the limited understanding of corporate-level decision-making with regard to pursuing venturing opportunities. More specifically, the paper adds new insights regarding how relatedness and uncertainty affect new venture opportunity assessments in the presence (or lack thereof) of slack resources.

Details

Management Decision, vol. 59 no. 5
Type: Research Article
ISSN: 0025-1747

Keywords

Article
Publication date: 1 January 1997

Devi R. Gnyawali and John H. Grant

Despite the growing body of literature on both organizational learning (OL) and corporate venture development (CVD), very few attempts have been made to establish connections…

Abstract

Despite the growing body of literature on both organizational learning (OL) and corporate venture development (CVD), very few attempts have been made to establish connections between these two literature streams. While existing literature provides some evidence that OL may facilitate the process of CVD, several interesting research issues remain unexamined. We know very little about (a) what type of learning processes are effective at various stages of CVD; and (b) whether and how knowledge created through various OL processes enhances venture performance. These research issues are examined in this paper by integrating the literature from OL and CVD. We develop a conceptual model that integrates organizational learning with the antecedents and outcomes of CVD. We argue that (a) organizational learning in CVD occurs through two distinct and yet complementary processes; (b) productive organizational learning occurs when organizations vary their emphases on different types of learning depending upon the stages of CVD; and (c ) different types of learning are associated with different types of venture outcomes. Propositions are developed and implications are discussed to facilitate empirical research.

Details

The International Journal of Organizational Analysis, vol. 5 no. 1
Type: Research Article
ISSN: 1055-3185

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