Intrapreneuership: Competitive Tool for SMEs

The business landscape globally is riddled with competition from every quarter more so Africa where SMEs have to contend with systemic government challenges, thin capitalization, and management issue among many other challenges.

One way to ward of competition and stay ahead of the pack is constant innovation by SMEs especially through intrapreneurship . SMEs need to encourage the creative spark in its employees through creating a conducive environment for innovation and offering incentives to the same effect.

Successful companies such as Safaricom, Equity Bank, Chase Bank, Basco Paints have one common denominator; constant innovation and re-invention. Products such as Mpesa, Mshari, Equitel, Fragrant Paint comes to mind.

Such innovation have also had a profound effect on the performance of other products such companies’ offers and improved their core business.

Innovations like these are important to SMEs for them to remain competitive. Although for many SMEs innovation may be at loggerheads with their core businesses and its supporting bureaucracy.

Having bureaucracy is great for intraprenuers in SMEs as it offers an already established distribution channel and a brand name.

Although many companies claim commitment to innovation; there is always the tension between the status quo of what is currently working and what is unproven. Success will only be achieved if there is a total commitment by all company stakeholders on the innovation agenda.

SMEs must create incentives for intraprenuership and ensure innovation is a key performance indicator to all employees and among its corporate goals. Further innovation must be tied to company annual bonus.

Secondly, due to inherent lack of resources with most small businesses especially on Research and Development, SMEs must take affirmative action to ensure it has a special and protected budget for Innovation. This will give intraprnuers the tools and resources needed to create and innovate.

Further management of  SMEs need to be patient knowing full well that is takes upto 5 years to bring innovative ideas to fruition. Finally, SMEs should consider creating an innovation evaluation framework

Successful innovation efforts in companies require leaders who have the guts to see opportunities and go after them—even if that means failing some of the time.