intrapreneurial group

intrapreneurial group

a group of employees within an organization who are encouraged to act as ENTREPRENEURS by ‘selling’ their goods and services in competition with other groups, to other groups or departments within the organization. No real money necessarily changes hands. Instead notional payments may be made and received. However, they may seek contracts with other organizations. The allocation of work within the group can be determined by members of the group. The potential benefits of this form of organization are that by providing profit incentives and facilitating identification of individual and group output, employee motivation is increased, while inter-group competition can keep costs down. On the negative side, the encouragement of sectional interests could harm those of the organization as a whole.

Variants of this idea have been popular in the UK in recent years. Many organizations have pushed responsibility for profits down to as low a level as possible in the organization (see STRATEGIC BUSINESS UNIT), whilst many have developed the use of notional transfer payments between departments so as to identify and control the costs of activities. This can be particularly relevant to the work of those service departments (such as personnel) whose contribution to the ‘bottom-line’ is otherwise difficult to quantify.

Mentioned in ?