The performance of state corporations in Kenya has not been as expected, as demonstrated by reports of unrelenting financial and managerial woes. In an attempt to reign on the poor performance, the government has developed policies on how to manage the state corporations, with emphasis on self-sustainability. The requirement to be self-sustaining demands that state corporations continuously innovate, improve themselves and competitively market their products and services, which in essence is intrapreneurship. This study analysed the prerequisites and outcomes of intrapreneurship in state corporations in Kenya. Using the theory of intrapreneurship, the study conceptualised the constructs of the prerequisites as encouragement by the management; rewards and communality; training and development; enabling work environment; organisational intrapreneurial orientation; individual motivation; individual competence; and individual intrapreneurial orientation. The outcomes of intrapreneurship that were studied were employee perceptions of job satisfaction, customer satisfaction and financial performance. To accomplish this, the study adopted an explanatory survey design and selected a disproportionate stratified sample from the population of state corporations in Kenya. The respondents were 182 employees in the state corporations. Data were collected using questionnaires and interviews and were analysed using descriptive statistics, correlations, analysis of variance and stepwise multiple regression. The information is presented in charts, tables and narratives. This study found that though the prerequisites of intrapreneurship were evident to varying degrees in all state corporations, the scores differed significantly among the organisations. Further, there was a significant relation between the prerequisites and the outcomes of intrapreneurship. The results of this research indicated that the key prerequisites of intrapreneurship, which have significant deterministic influence over the outcomes, were individual motivation; enabling work environment; organisational intrapreneurial orientation; rewards and communality; and individual intrapreneurial orientation. The study concluded that some prerequisites had an antecedent effect on other prerequisites. Thus, for intrapreneurship to take place and the outcomes envisaged to be accomplished, the staff should be motivated to act intrapreneurialy, and there should be an enabling work environment in the organisation. The variability in the outcomes that was accounted for by the prerequisites suggested that there are other factors, beyond the scope of this study that have an effect on the outcomes. These findings contribute to intrapreneurial theory by showing that various prerequisites of intrapreneurship do not have a direct impact on the outcomes but rather have an antecedent effect on the prerequisites. The study recommends that there is need to establish reward systems for innovative undertakings. Training programs to build and strengthen intrapreneurship should be implemented in state corporations since they will contribute towards an enabling work environment for intrapreneurship. The study also provides guidance to managers interested in motivating their employees to undertake intrapreneurial activities. The results also give direction to employees by offering them different scenarios that lead to job satisfaction, customer satisfaction and financial performance. For future research, it was recommended that objective measures on financial performance be utilized in similar studies. An assessment of the efficacy of intrapreneurial programs in state corporations could also be investigated in order to give clear links to improved performance.
CHAPTER ONE : INTRODUCTION
This chapter presents the concept of intrapreneurship and background information about state corporations in Kenya. The chapter further discusses the research problem, objectives of the study, its justification and definition of the key terms used in the research.
Background of the Study
The importance and potential of intrapreneurship for the development of innovation is widely recognized. This is because intrapreneurship is key towards innovation in established organisations and innovation has become a major driving force for business growth and success. (Covin & Miles, 1999; Jong, Parker, Wennekers & Wu, 2011; McMurray, & Chapman, 2009; Tao, Probert, & Phaal, 2010). Its application in organisations has a lot of potential for organisational development that would lead to greater returns.
Intrapreneurship is the practice of entrepreneurship within the context of an established organisation. It has been exalted as a necessity for society as a whole, as well as for specific organisations and industries, especially at a time when unemployment rates are high, when market globalization is increasing and when environmental changes are escalating, (Cornwall & Perlman, 1990; Kamffer, 2004; Republic of Kenya [ROK], 2003, 1994, 1992, 1986). Further, established businesses, when confronted with fierce global competition, tend to regard intrapreneurship as a way of staying competitive. This has led to an emerged and sustained interest in studying intrapreneurship within existing organisations. The term “intrapreneurship” was coined, to describe entrepreneurship within an organisation (Jong, et al., 2011; Pinchot, 1985; Saetre, 2001). The term emphasizes the collective and corporative aspects of entrepreneurship. It reflects on the efforts made by an organisation to improve
internal work/business processes and operations (Lutfihak, Cagri, Gurhan, Gunduz & Kemal, 2010).
Intrapreneurial practices as well as intrapreneurial managers are required for organisations to compete successfully in the new competitive environment and to exploit opportunities key to sustainable economic development (Kamffer, 2004). The increasingly competitive markets and the emphasis on decreasing costs while increasing revenue should be two key drivers for firms to increase their intrapreneurial activities (Sembhi, 2002). Intrapreneurial activity also plays an important part in radical innovation discovery and wealth creation.
Prerequisites of intrapreneurship are vast. As mentioned e.g. by Antoncic and Antoncic (2011) and Menzel (2008), intrapreneurship occurs on two levels: the level of the organisation and on the level of the individual. Support by the management is generally thought of as beneficial for intrapreneurship and change in the organisation (Vandermerwe & Birley, 2000). Importance of management involvement, as well as management encouragement, and rewards in terms of training and trusting individuals within the firm to detect opportunities have been proposed to positively influence an organisation‟s intrapreneurial behaviour (Monsen, Saxton & Patzelt, 2007; Sijde, Veenker & During, 2013).
Intrapreneurship is initiated in established organisations for purposes of profitability, strategic renewal, fostering innovations, gaining knowledge of future revenue streams and international success (Hornsby, Kuratko & Zahra, 2002; Kroeger, 2007; Riot, 2010; ). Indeed as Antoncic and Antoncic (2011) and Heskett and Sasser (2010) stress, organisational performance, growth and development, employee satisfaction and customer satisfaction may depend considerably on intrapreneurship and employee-related prerequisites.