Employees as ``co-intrapreneurs'' ± a transformation
concept
Keywords
Co-operation, Problem solving,
Leadership
Abstract
The article offers a systemic
framework and transformational
concept of ``co-intrapreneurship'',
which is defined as the efficient
support of the enterprise strategy
by problem-solving, socially
competent and implementation-
oriented thinking, and the acting
of as large a number of employees
as possible at all hierarchies and
functional areas with a high
degree of self-initiative and sense
of responsibility. The classical
leadership model of hierarchy and
bureaucracy is questioned and
internal market control and co-
operative social networks are
offered as alternative systems of
co-ordination. A particular
emphasis is placed on a specific
leadership and typology approach
for selection and assessing co-
intrapreneurial potential, key
competencies and motivation,
which also serve as target-
oriented strategy for developing
``co-intrapreneurship''. In addition
to presenting illustrative figures
and referring to various empirical
studies and surveys, the article
concludes with some practical
guiding principles for the
advancement of effective
``co-intrapreneurship''.
Received: August 1999
Revised/accepted:
April 2001
Leadership & Organization
Development Journal
22/5 [2001] 193±211
# MCB University Press
[ISSN 0143-7739]
Rolf Wunderer
Institute for Leadership and HR Management, University of St Gallen, Switzerland
Introduction
The increasing pressure to compete, the
globalization of the economy as well as the
transition of an industrial economy to a
``knowledge-based'' service economy all lead
to a higher demand for employees to increase
their level of performance.
In the modern context of a post-industrial
economy, the work force can no longer be
understood only as a factor of production, but
has become a strategic determinant of
success (e.g. Blyton and Turnbull, 1992;
Jackson and Schuler, 1999). Human resources
in particular are not primarily to be seen or
treated as a ``cost component'', but as a
potential source for added value and long-
term investment. Furthermore, the
transition in basic values favors a
combination of independence and creative
teamwork as well as service and result-
oriented activity (Ulrich, 1997; Ulrich et al.,
1999).
Seeking alternatives to command-and-
control, new post-bureaucratic models of
organizations, based on co-ordination,
emphasize the need for decentralizing
authority and development of team-oriented
designs. Decision-making processes and
entrepreneurial activities need to be
conveyed to the level of each individual in
the organization in order to tap their specific
competencies and knowledge for the future
success of the company.
Accordingly, management practice
and leadership theory have developed
concepts which recognize aspects of
``internal entrepreneurship'', sometimes
under a different name. Entrepreneurship
in organisations serves as a strategic
core competency which opens non-copyable
competition advantages on middle
view.
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In this context, our approach for describing
and explaining co-intrapreneurship offers a
comprehensive and integrated framework for
situational applications.
In this article a framework is presented
which outlines the basic elements of a
transformative process towards
co-intrapreneurship. These elements refer
to the goals, context, key competencies,
motivation and identification, co-ordination
and leadership and specific target-oriented
policies. The results of empirical
investigations are integrated to support our
approach and to refer to its practical
relevance.
Co-intrapreneurship ± a need of
corporate practice
Changes in the business environment and
management philosophy have led to an
increasing number of companies demanding
internal entrepreneurship, not only from
their managers, but from all employees. To
quote a few examples ± mostly from corporate
visions or management principles:
Everyone behaves in an intrapreneurial, non-
bureaucratic and productive manner (IBM).
We ask our employees to be ``entrepreneurs''
in their own affairs, to recognize the precise
strengths and competitive advantages of their
business, to believe in themselves and in
success (Siemens).
We build on independence; i.e. we pre-
determine a framework . . . We promote and
reward intrapreneurial behaviour and the
willingness to take a risk (Ciba).
We think, decide, and behave in an
intrapreneurial way (UBS ± Swiss Bank
Corporation).
Outstanding and innovative products and
services will be the focus and essential
components of value-driven management.
This requires a management philosophy
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[ 193 ]
Rolf Wunderer which is based on intrapreneurial thought
Employees as and behaviour (DaimlerChrysler).
``co-intrapreneurs'' ± a
transformation concept These statements of leading companies
Leadership & Organization manifest the contemporary requirement of
Development Journal
an internal entrepreneurship within
22/5 [2001] 193±211
corporate practice. Ideas relating to
entrepreneurship were primarily introduced
in Germany by independent pioneer-
entrepreneurs, who not only preached
``corporate social partnership'' but also
practiced and implemented it. However, once
they had retired, their model was often not
continued or abandoned. A further feature of
these historical initiatives was an
orientation towards financial models of
participation and co-determination. What
was primarily discussed and recognized as a
normative concept of social small and
medium-sized enterprises (SMEs) in the 1950s
and 1960s is now developing as a
management concept for global players.
Today, economic and socio-ethical themes
such as co-determination or shared
ownership are no longer the focus of
attention. They have been replaced by
demands on contemporary and efficient
(knowledge) management (Krogh et al., 2000)
± particularly by large enterprises striving
for cultural, organizational and strategic
change.
Definition and objectives of
co-intrapreneurship
Entrepreneurship can be defined as the
process of eliciting or evoking value from
new and unique combinations or re-
arrangements of resources in an uncertain
and ambiguous environment. Consequently,
internal entrepreneurs can then be
understood as co-operating organization
members, which innovate, identify and
create business opportunities, assemble and
co-ordinate new combinations or
arrangements of resources so as to yield or
enhance value. They initiate actions to fill
currently unsatisfied needs and claims or to
do more efficiently what is already being
done. Therefore, the objective of
intrapreneurial activities is to safeguard
and to increase the corporate value in the
long term by optimizing the benefits for the
central stakeholders. Even more than the
marketing or person-oriented (Foxall and
Minkes, 1996) or conventional approach of
``intrapreneurship'' (Pinchot, 1985), a ``co-
(operative) intrapreneurship'' combines the
organization-internal competition with a
long-term, win-win-oriented co-operation.
Consequently, co-intrapreneurial
development can be understood as socially
[ 194 ]
effective and processes that support all
members of an organization and their co-
operating interaction. Co-intrapreneurial
orientation unites a responsibility for the
whole and at the same time enables teams to
practice their own local flexibility and
freedom. In this way, a co-intrapreneurial
organization is able to integrate the result
and efficiency orientation with
commitment, openness, and trust in
voluntary learning organizational
networks.
Elements of the transformation
process
The essential elements are illustratively
systematized in Figure 1, and will be
discussed subsequently.
Goals
P1: Added value for the company and the
creation of benefits for the central
stakeholder groups are ranked higher
than maximizing benefit for one
stakeholder group.
Argument 1
The main objective is to safeguard or
increase the ``company value'' in the long
term with and by creating benefit for all
central stakeholder groups. This does not
support an unbalanced orientation towards
just one group of stakeholders. The so-called
stakeholder approach has been discussed in
management theory since the 1960s (Cleland
and Bruno, 1996; Freeman, 1984; Rappaport,
1997). In accordance with this approach, it is
management's duty to record, assess and,
where possible, satisfy the needs and
demands of the central stakeholders and
thereby increase the company's value. The
key stakeholders include: customers,
suppliers, shareholders and, last but not
least, all employees. In countries which lack
raw materials and in our service and
knowledge-based post-industrial society, the
latter are the most important source of added
value (Baumol, 1959; Clarkson, 1995).
Companies which want to recruit and
promote employees as co-intrapreneurs in
the long term must recognize them as
partners and refrain from using them as
stakeholders' investment goods. This
requires an appropriate understanding ±
especially from the management of large
joint-stock companies ± which is expressed in
both corporate principles and everyday
behaviour. The same also means that co-
intrapreneurs are entitled to a tangible
benefit of the added value which is co-created
by them (Beam and McFadden, 1998).
Rolf Wunderer Figure 1
Employees as From employees to co-intrapreneurs ± a framework for transformation
``co-intrapreneurs'' ± a
transformation concept
Leadership & Organization
Development Journal
22/5 [2001] 193±211
However, our co-intrapreneurial approach is
a concept of intrinsic motivation and
behaviour, which should not be distracted by
extrinsic incentives (e.g. payment) that may
undermine or drive away the inherent
motivation (Frey, 1997; Deci and Ryan, 1985;
Ryan and Deci, 2000). Finally, concerning
behavioural objectives, co-intrapreneurship
strives for realizing processes connected
with mutual sympathy, shared knowledge,
communal thinking, common performance,
conjoint responsibility; co-development and
fair profit sharing.
Conclusion 1
Until now, a generally theoretical and
practical solution for simultaneously and
optimally satisfying all central stakeholder
groups has not been found. Foremost, it is
the duty of management to increase the
company's value. As this will be not
possible without conflicts, handling this
challenge will always be a non-conferable
task of top management. For this,
situation-adapted solutions need to be
found in order to satisfy equally the claims
of all central stakeholders including the
employees.
Context
P2: The macro and micro conditions, as well
as the resources, are the basic conditions
for the co-intrapreneurial transformation
process.
Argument 1
The macro and micro context. The macro
context concern the surrounding field of the
company; e.g. politics, law, economic,
societal and technological environment.
Current contextual changes ± like increasing
competition and globalization as well as
cultural value shifts ± require engaged co-
intrapreneurial employers on a broad base.
The fundamental conditions of the internal
company form the micro context. We can
differentiate between cultural, strategic, and
organizational realms to be further
discussed.. The arrangement of these
dimensions determines to what extent
co-intrapreneurship will be promoted or
restrained.
Stakeholder. Since enterprises live in
exchange with their environment, the
interests and needs of their stakeholders ± in
particular capitals owner, customers,
employees, suppliers, society and the
environment ± determine to a considerable
degree both the possibility and the necessity
for a ``lived co-intrapreneurship''. In times of
homogeneous products, a co-intrapreneurial
approach, supporting pace, reliability,
quality, or friendliness can facilitate the
focus towards customers and service. This
sustains and increases the enterprise value
in addition to contributing to broader
societal interests, e.g. an increase of the gross
national product or a lowering of
unemployment.
[ 195 ]
Rolf Wunderer Resources. To what extent
Employees as co-intrapreneurship will be successfully
``co-intrapreneurs'' ± a implemented further depends on the
transformation concept
availability of personnel, financial,
Leadership & Organization
Development Journal informational, natural and technical
22/5 [2001] 193±211 resources. Thus, the generation and
realization of new ideas presupposes not only
a sufficient stock of information, but often
also financial and technical means as well as
energetic support by the surrounding social
and economic field.
Conclusion 2
Whether or not ``internal entrepreneurship''
will thrive can be affected by human resources
in the external and internal job market. In
``entrepreneurial countries'', like the USA, this
is much easier to implement than in
developing or transforming countries with
authoritarian or bureaucratic structures.
Potential
P3: Selection and advancement concentrates
on a few key co-intrapreneurial
competencies rather than a catalogue of
general, technical or job-specific
characteristics
Argument 3
Personnel management still prefers concepts
stemming from its bureaucratic-
administrative history (Wunderer, 1995;
Ulrich, 1997). This explains why appraisal
instruments rarely comprise less than 15-20
criteria. The estimation of potential is driven
by an assessment of employees' professional
and behavioural characteristics, with special
criteria added for managers. The classical
performance appraisal is based on a job
description and concentrates on criteria
specific to the job. Years of research into this
area have lead us to the conclusion that this
approach to appraisal contributes very little
to the strategic control of behaviour.
Conversely, applications of the ``key
qualification concept'' appear to be more
appropriate for promoting internal
enterprise, by concentrating on a few extra-
functional competencies. In our own
approach only three key competencies were
selected; namely: conceptualization
competencies (creative problem solving for
retructuring and continuous improvement),
implementation competencies (effective
persuasiveness and enforcement) and
co-operative self-organization (social
competencies) (see Figure 2).
Conceptual and implemenation-oriented
competencies have been selected from the
area of intellectual competencies.
Schumpeter (1912, 1934) emphasizes that
creativity alone could easily end in
daydreaming. In order to avoid this, all
[ 196 ]
creative talents should focus on achieving
strategic corporate goals. He considers the
central criteria for his entrepreneurial
concept to be the ability and motivation to
implement by persuading and enforce new
solutions to problems. It is essential that
these competencies be used efficiently, i.e.
that they meet all objectives, satisfy all needs,
and create benefits within the given
timeframe. It is common knowledge, in
theory and in practice, that the problematic
nature of implementation is often critical to
the success of transformation processes. For
this reason, it is often embarked upon
reluctantly. Concerning social competencies
for entrepreneurial behaviour, only a limited
amount of material in the literature was
found. Either mere features are named,
which lead to competent self-assertion or a
``diplomatic'' pursuit of interests, etc. or
definitions focus on altruistic patterns of
behaviour. We refer to a basic definition by
Preiser (1978), who describes social
competency as a successful combination of
autonomy and co-operation (see Figure 3).
This ability and the motivation to behave
accordingly can be characterized as
``co-operative self-organization''. This implies
that to act as socially competent means to be
able to deal with one self and others
constructively.
We are convinced that a concept of co-
intrapreneurship can only be successfully
implemented and further developed if
essential social competencies are guaranteed
and practiced within a team and in cross-
functional co-operation. An entrepreneur
may be successful if, in accordance with the
homo-oeconomicus concept, he or she behaves
in an egoistic and individualistic manner in
anonymous markets. According to Pinchot,
an intrapreneur can also achieve short-term
success in internal markets with a masterly
application of micro tactics or politics aÁ la
Machiavelli (1950).
Pinchot's ten commandments (Pinchot,
1985) manifest some of these:
1 Come to work each day willing to be fired.
2 Circumvent any orders aimed at stopping
your dream.
3 Do any job needed to make your project
work, regardless of your job description.
4 Network with good people to assist you.
5 Build a spirited team: choose, and work,
only with the best.
6 Work underground as long as you can ±
publicity triggers the corporate immune
mechanism.
7 Be loyal and truthful to your sponsors.
8 Remember it is easier to ask forgiveness
than for permission.
Rolf Wunderer Figure 2
Employees as Co-intrapreneurial key competencies
``co-intrapreneurs'' ± a
transformation concept
Leadership & Organization
Development Journal
22/5 [2001] 193±211

9 Be true to your goals, but be realistic
about the ways to achieve them.
10 Keep the vision strong.
However, co-intrapreneurship requires long-
term, mutual and trust-based co-operation
within a social network (Axelrod, 1984),
which Pinchot has integrated in his recent
modification of the commandments (Pinchot
and Pellmann, 1999). This distinguishes
co-intrapreneurship from the classical
definition of an individualistic
entrepreneur's and the conventional
intrapreneur's role in a fundamental way.
Concerning the dissemination of the
co-intrapreneurial key competencies we
found in our empirical studies, the results
shown in Figure 4.
Conclusion 3
In socially stable organizations, which are
based on the division of labor and operate for
the long term, close internal co-operation in
conjunction with the ability and willingness
of employees to work in a team within a
social network are essential for an efficient
co-intrapreneurial practice. In addition to
these indispensable social competencies,
there are two further key qualifications for
co-intrapreneurial behaviour: creative
problem solving and the operative ability to
implement and accomplish. All of these
should become part of the company's

Figure 3
Social competencies

[ 197 ]
Rolf Wunderer Figure 4
Employees as Dissemination of co-intrapreneurial capacities and motivation
``co-intrapreneurs'' ± a
transformation concept
Leadership & Organization
Development Journal
22/5 [2001] 193±211
structural conditions and consequently
increase its value.
P4: Co-intrapreneurial motivation and
identification are first analyzed
separately from relevant competencies
and promoted in a targeted manner.
Argument 4
Our research into the nature and the
distinctive features of the three selected key
co-intrapreneurial competencies has lead us
to elevate the identification and motivation of
employees in addition to the development of
competencies. After all, a competency
approach does not automatically guarantee
that the potential identified by a company will
also be appointed in that company ± not even
to support issues that have been strategically
selected. Many academics who support the
statement that key abilities can easily be
elevated are probably referring above all to
employees' motivation to practice them. Bass
(1985) even defines leadership as ``the change
of motives or habits''. In the context of the
shift of employees' values towards post-
materialistic and leisure-oriented structures
(Inglehart, 1989), managers are faced with
specific tasks. Above all, this concerns the
significance of an employee's own tasks as a
central source of identification as well as the
decline in importance of financial incentives.
According to the process-driven motivation
theory (Lawler, 1991, 1994; Vroom, 1964), the
primary role of leadership is to influence the
assessment (valence) of strategic goals and
methods; here we are referring to the
previously discussed transformational
leadership.
Second, it states that management involves
promoting and evaluating the suitability of
measures that are appointed to achieve an
[ 198 ]
objective. During a survey (Wunderer, 1999,
p. 47) HRM managers from large companies
were asked to respond to the question
``Which instruments could be used to support
co-intrapreneurial behaviour?''. They ranked
the instruments in the following order:
. management by objectives;
. individual area of responsibility;
. targeted selection of personnel;
. participative/delegative leadership;
. personnel training and development;
. personnel appraisal/employee
conversation;
. demanding tasks;
. performance-related pay;
. internal/external customer surveys;
. design of a corporate culture;
. profit sharing;
. shares for employees; and
. fringe benefits.
Objective- and performance-oriented
motivation. The aforementioned responses
particularly favor transactional, i.e.
objective-oriented and performance-oriented
management (Bass, 1985). In contrast,
concepts for monetary benefit sharing were
considered to be less important. Third, it is
important to know the extent to which
employees assume that their commitment
will bring them success. This assessment of
the probability of success will be
considerably influenced by the degree to
which one, as an employee but also as a
manager, attributes success or failure to
oneself or to others (attribution theory of
motivation (Weiner, 1990)). These three
central components of motivation should be
influenced in a targeted manner through
structural management and interactive
leadership.
Rolf Wunderer Finally, management is associated with the
Employees as extent to which individual aspects of
``co-intrapreneurs'' ± a motivation contribute to the tasks
transformation concept
performed. With reference to Maslow's (1987)
Leadership & Organization
Development Journal and Herzberg et al.'s (1973) classical concepts,
22/5 [2001] 193±211 it is important to support individual
employees as they strive for more ``growth
motives'' (e.g. responsibility, team
motivation, challenging tasks) or ``hygiene
factors'', such as the condition of one's
workplace or material incentives. With this
coincides the need to reduce motivational
barriers, as entrepreneurially oriented
employees are already motivated, but can
become demotivated. A demotivated
workforce represents a serious challenge for
an organization. Trying to meet and/or
exceed performance goals with a demotivated
workforce is frustrating at best and
disastrous at worst, as an unmotivated
workforce produces inferior results and can
suffocate nearly any attempt at
organizational improvement (Longenecker
et al., 1999). A climate of demotivation and
negativity stifles organizational change,
risk-taking, and proactive behaviour, while
increasing stress and communication
breakdowns (Meyer, 1978; Spitzer, 1997).
Therefore, as part of a proactive
co-intrapreneurial approach, structural
and interactive strategies as well as
measurements for preventing and
overcoming demotivation and work
alienation will be essential (Spitzer, 1997).
Identification patterns as person-related
co-intrapreneurial basic motivation. The
identification patterns of individual
employees are less dependent upon the
situation because they are specific to the
person and they are constant but growing
(Ackermann, 2000; Wunderer and Mittmann,
1995). It is crucial to know the following:
whether or not employees see their
customers and products or services above all
as objects of identification; to what extent do
they demonstrate voluntary commitment or
take on extra-functional roles; how efficiently
do they implement what they know; how
much is it part of their personality to seize
opportunities or to be motivated by co-
operation; and finally how strong is their
commitment and loyalty to their own
organization, in the sense of ``organizational
citizenship'' (Moorman, 1991; Smith et al.,
1983).
Organizational citizenship supports
co-operation and co-intrapreneurship by
preventing problems, creating general
``sportsmanship'' and taking on extra
responsibilities (Bovens, 1998). Such basic
and relatively stable attitudes are more
important for co-intrapreneurial behaviour
than situationally dependent motivation.
This latter attaches a lot of importance to
personnel selection and an appropriate
appointment.
In contrast to extra-functional co-
intrapreneurial competencies, a reliable
assessment of motivation and identification
is difficult because they are part of the
``black-box'' of the personality and may vary
according to the situation. Even for two key
qualifications such as implementation and
social competencies, statements conveying
potential are of limited significance on their
own. Greater significance must therefore be
attached to the application of (self)
motivation ± which changes according to the
situation ± than to the ability to be motivated.
In comparison with competencies,
motivational behaviour is also
comparatively easier to alter. Amazingly,
(self) motivation has neither been addressed
as a theme in (neo) classical economics, nor
in discussions about knowledge
management. Impressive examples in
practice are employees who, for example,
continue to operate a business at their own
risk in the form of a ``spin off'' or set one up
on their own. However, transfers of
responsibility for results to leaders of profit
centers can affect a similar ``change in
values''. Affected parties are themselves often
surprised to learn what has resulted from
their co-intrapreneurial behaviour.
Conclusion 4
Motivation and identification are, at first, to
be analyzed separately from relevant
competencies and promoted in a targeted
manner. This reduces over-generalized
results for both areas. Values, which
constitute a corporate culture, should
correspond with employees' individual
values and motives or at least be compatible
with them. Selection and advancement
should occur in accordance with a few key
co-intrapreneurial competencies instead of a
wide catalogue of general, technical or
job-specific characteristics.
Co-ordination and leadership
P5: A configuration of market and social
network as systems of co-ordination
modify and substitute the classical
leadership model of hierarchy and
bureaucracy.
Argument 5
The definition of internal entrepreneurship
± which should not be forgotten ± is closely
connected to market-oriented concepts of
control/command. The concept of ordo-
liberalism (Koslowski, 2000) is particularly
important for structural control concepts. In
[ 199 ]
Rolf Wunderer accordance with this, a structural policy and
Employees as appropriate global control of the economy
``co-intrapreneurs'' ± a should support the promotion of
transformation concept
entrepreneurship. Direct political or
Leadership & Organization
Development Journal administrative interventions are only
22/5 [2001] 193±211 accepted in exceptional cases (``management
by exception''). Schumpeter's personage and
evolutionary-dynamic approach considered
structural conditions more as constraints,
which the typical entrepreneur avoids, break
through, or redesigns (Schumpeter, 1912/
1934, 1942, p. 84). We can distinguish between
four concepts for internal control, which tend
to be used simultaneously, but with differing
importance. They are hierarchy,
bureaucracy, internal market, and social
network, as illustrated in Table I with its
essential criteria.
Prominent features of the internal social
network ± also occasionally referred to as a
clan or ``corporate family'' (Ouchi, 1981;
Wilkins and Ouchi, 1983) ± include: mutual
co-operation, human relations and emotional
exchange of ``homo socialis'', but also
sustainable fostering of useful ``homo
oeconomicus'' relations. In this primarily
social transaction, it is not cash value that is
created and measured by output results, but
(expected) motives and intentions are equally
valued. Trust is the prevalent base and
medium of coordination (Parson, 1951). The
difference between economic exchange and
social transaction can be described as
follows. Economic exchange is characterized
by a calculated orientation, and focuses on
payment of cash in return for services.
Effective exchange ratios dominate as well as
an effective short-term fairness of
distribution (e.g. performance in exchange
for money equivalents). In comparison,
social transaction is distinguished by mutual
trust in long-term, non-specified, or non-
specifiable returns for actual performance,
the hope of long-term fairness and
commitment, as well as stakeholder
orientation (Berthoin et al., 1994; Clarkson,
1995; Lamb, 1994). Human or, to be precise,
social capital has recently been defined as the
totality of all relations in a network, which is
itself considered to be an accelerator of
change (Nohria and Ghoshal, 1997; Sachwald,
1998) referring to the meaning of mutual
values and concepts (Witt, 1998).
Generally, social networks produce a
stronger and more long-term effect due to the
emotionally sound relationships between the
participants in the internal market, as
opposed to professional relationships in a
bureaucracy. Furthermore, in comparison to
a hierarchy, a social network and internal
markets are less instruction-driven and less
organized by others, but more proactive and
more lateral. Networking occurs in a
functional and emotional ``exchange market''
based on mutual reliance, whereby the focus
is on the achievement of synergy, win-win
co-operation and voluntary commitment.
Internal market control is subject to specific
conditions, especially compared with the
(neo)classical model of external control via
anonymous markets and short-term
orientation. These include the long-term
formation of personal social connections in
accordance with the concept of infinite

Table I
Systems of co-ordination
Bureaucracy/ Internal social
Concept Hierarchy technocracy network Internal market
Basis of Power Professionalism Co-operation Competition
legitimization Decisions/ Rules/regulations Trust Performance
instructions Obligation Results
Management Instruction-related Professional Relationship- Profit-oriented
philosophy oriented
Emphasis of role Subordinate Expert Colleague/ Intrapreneur
co-worker
Prevailing Satisfaction of Loyalty to the Satisfaction of Customer
orientation towards managers system managers/ satisfaction
reference groups Personal colleagues and (internally as well
satisfaction employees as externally)
Specific indicators Ability and Competence Ability to establish Ability to be
of competencies/ willingness to adapt Experience relations innovative
qualifications Reliability Reliability Fundamental beliefs Willingness to take
(selection) Operative ability Rule-orientation Understanding a risk
and willingness to Justice Individual and Ability to implement
implement mutual support and enforce
Mutual trust Opportunity and
profit orientation

[ 200 ]
Rolf Wunderer games (Axelrod, 1984). Internal market
Employees as control has been increasingly practiced
``co-intrapreneurs'' ± a
transformation concept and since the 1990s. It has also been used
for internal service providers, such as
Leadership & Organization
Development Journal HRM departments. A co-intrapreneurial
22/5 [2001] 193±211 organization can be approached
through internal markets organised by
decentralized profit centers or ``value-added
centers''.
Both systems of co-ordination lead to a new
and specific cultural and organisational mix
between market and social exchange that can
be characterized as an ``internal social
market economy'' in which its players are
viewed as ``co-intrapreneurs''. ``Social'' refers
to the original meaning of the word, implying
``relating to'' and ``supporting the
community''. In this combination of co-
operation and competition we, and the
majority of practitioners we have
interviewed (see Figure 5), envision a
desired, and effective system of co-ordination
for co-intrapreneuship. Hierarchy and
bureaucratic control still apply, but have and
will become less important.
Conclusion 5
As a priority, co-intrapreneurship should be
promoted by (internal) market control and
co-operative social networks, as a way of fair
``co-opetition''.
Co-ordination and leadership
P6: Structural-systemic management and
development define the conditions, which
promote interactive and
transformational management that is
appropriate to both the situation and
employees.
Argument 6
As previously indicated, guiding
entrepreneurial values can only guarantee
success if the business environment provides
supporting conditions. Bill Hewlett once said:
``I am convinced that men and women want to
produce good and creative work and that
they will achieve this once they have the
appropriate environment!'' This is confirmed
by economic studies, which were unable to
prove a significant connection between
extrinsic incentives or profit sharing and the
motivation to succeed (Frey, 1997). With this
in mind, the aforementioned Ordo-
Liberalism approach would be ideal for
controlling the economy as a whole. It
involves the adoption of structural measures
to create the desired context, i.e. a
work situation, which promotes
co-intrapreneurship. Structural management
can be accomplished by adopting four
approaches (see Figure 6). Co-intrapreneurial
culture, strategy, (self) organization, and

Figure 5
Systems of co-ordination today and 2010

[ 201 ]
Rolf Wunderer Figure 6
Employees as
``co-intrapreneurs'' ± a Dimensions and levels of structural leadership
transformation concept
Leadership & Organization
Development Journal
22/5 [2001] 193±211
personnel structure. These are integrated
correspondingly into four levels (person,
department, company, and society). The
influence of one, for example,. corporate
culture alone is insufficient, as it only
constitutes one of the 16 fields of influence
and design.
A weakness of many business and
management theories is that they only
discuss culture, strategy, and organization
with regard to the company, though all four
levels and fields of design need to be
considered in a co-ordinated manner.
Culture. The transformation from
bureaucracy towards a co-intrapreneurial
culture can be illustrated by the shifts shown
in Table II.
First, these shifts involve the development
of corporate and management culture by
adopting management values, which promote
co-intrapreneuship. Such values include
(self-)initiative, support of personal concerns
and ideas, as well as service oriented and pro-
social behaviour. We recommend that these
are recorded and anchored in corporate and
management principles, in order to
encourage and support entrepreneurial
collaboration. Furthermore, our approach to
co-intrapreneurship also considers the
ongoing societal transitions of basic values
and the increasing need for leisure time.
Companies of tomorrow will constructively
integrate central values and key features of
the private world into the working context.
[ 202 ]
They should then evaluate the extent to
which these are compatible with values
already practiced by their employees.
Finally, the ability to convert the actual
culture of the company to the envisioned
co-intrapreneurial culture is critical for
success. It is important that in their role as
promoter, senior managers set an example by
demonstrating an emphatic commitment.
Only then can culture be understood as an
arrangement of values, which are commonly
shared and practiced. However, the final
responsibility remains with all persons
concerned.
Strategy. Strategy connects valuable
objectives with appropriate measures. Here,
customer-driven strategic orientation will be
particularly important because employees
are also focused on the internal market.
Equally significant is the use of supportive
management instruments such as
``management by objectives'' or ``by
exception'', because they are the center of
transactional leadership (Bass, 1985). In
addition to this result-oriented approach,
co-intrapreneuship can be deployed
effectively by co-operative management
styles. They are based on delegation of
internal control prices as well as profit
sharing, which depends on the performance
of either individuals, teams, departments, or
the entire company. However, it must be
noted that the mere announcement of new
organizational structures does not
Rolf Wunderer Table II
Employees as Elements of a culture supporting co-intrapreneurship
``co-intrapreneurs'' ± a
transformation concept Instructions and regulations => Meaning through vision
Leadership & Organization Change as a threat => Change as an opportunity
Development Journal
22/5 [2001] 193±211 Fear of mistakes => Willingness to make mistakes and learn
Questioning of new ideas => Committed support of ideas
Big-bang-innovation => Continuous improvement
Short-term self-interest => Long-term co-operative orientation
Monitoring and control => Mutual trust and freedom
Internal self-orientation => Customer orientation

Note: Compare also Bitzer (1991)

correspondingly change the conventional 1 Formulate an inspiring vision and

ideas of employees.
Organization and personnel structure.
Finally, the design of the qualitative
personnel structure is important, whereby
the focus is on co-intrapreneurial
competencies and motives. These
characterize the personnel prerequisites and
chances for the transformation process
towards co-intrapreneurship. As social
competencies are only changeable on a long-
term basis, there is a particular need for a
befitting and potential oriented recruiting
and selection.
The status of interactive leadership.
Interactive leadership remains significantly
important. Every company can consider itself
fortunate if it has charismatic leaders
(Conger, 1989) at all levels, who can
successfully implement previously developed
entrepreneurial structures with their
employees'. However, one must not be under
any illusions that their numbers approach a
normal distribution; charismatic people are
rare. Therefore, a general management model
should not be based on these exceptional
cases. ``There is nothing wonderful about
being an effective manager . . . If it were
necessary for saints, poets, or top class
scholars to fill their intellectual position,
organization on a grand scale would simply be
absurd and impossible'' (Drucker, 1993).
According to Drucker (1993) in his statement
regarding ``ideal managers'', the needs of large
organizations must be satisfied by ordinary
people who can achieve exceptional
performance. With charismatic management,
there is a danger that employees will become
infantile, particularly if those affected cease to
reflect upon their influence process (Manz
and Sims, 1991). Bass's (1985) concept of
transformational management, based on the
transactional approach, appears to be more
suitable for our specific theme than the
charismatic ``hero approach''. With the help of
the following three managerial tasks,
employees can develop more demanding
values and objectives:
demand respect, trust, and loyalty.
2 Introduce new ideas and improve
employees' understanding, as well as their
perception of and ability to solve
problems.
3 Increase motivation and self-confidence in
personal abilities, and achieve this by
individually supporting the employees.
In our own surveys regarding the preferred
manager type, it was evident that those
interviewed (students and managers)
significantly preferred transformational
managers in contrast to gripping,
enthusiastic, charismatic managers, because
they encourage self-control and self-
development. The roles of coach and
motivator were identified as being
particularly important. Also significant,
more managers can accomplish this profile of
requirement.
Conclusion 6
Structural-systemic management and
interactive leadership must be consistent
with each other. Demanding structural
control requires appropriate interpretation,
motivation, preventing or overcoming
demotivation and situational
implementation, which are part of the
manager's responsibility. For qualified and
committed employees who acknowledge
responsibility for their own actions, focus
can be placed on structural management
measures, in which culture is again of
primary importance. Transformational
management forms or those which involve a
delegation of values are easier to achieve and
less problematic than seducing, charismatic
managers.
P7: Proactive self-control and self-
organization in the context of
structural management reduces
Tayloristic control by others.
Argument 7
F.W. Taylor's maxim is well known:
``Workers have no need to think because
managers do that for them''. Recently, this
[ 203 ]
Rolf Wunderer principle has regained its importance in
Employees as practice. The ``shepherd'' philosophy of
``co-intrapreneurs'' ± a management, which states that success is
transformation concept
due to the ``boss'' alone, has certainly played
Leadership & Organization
Development Journal a part in this. However much it is essential
22/5 [2001] 193±211 that managers remain responsible for
stimulus, co-ordination, situational
interpretation and final decisions, the focus
for co-intrapreneurial orientation is
different. Appropriate leadership and a
supporting context of structural management
by culture, strategy and organization should
center on promoting competent and
motivated employees. However, the
foundation for employees' attention,
reflexivity, participation in decision making,
involvement in negotiations, and sharing of
responsibilities lies in their ability and
motivation to be voluntarily committed
(Yoon et al., 1994; Walton, 1987) and to be
proactive via manager control and coached
self-control (Manz and Sims, 1987). Generally,
according to the subsidiarity principle, the
manager should only intervene if a
particular employee is overburdened by the
tasks in a particular situation. After
appropriate personnel selection and training,
this should be an exceptional rule for special
cases (management by exception).
Management principles based on the
``systems approach'' (Drucker, 1993; Stacey,
1992, 1999; Stacey et al., 2000) also consider
the self-control concept to be a functional
prerequisite for success in terms of the
design, development and control of
organizations.
Conclusion 7
Co-intrapreneurship can be promoted
effectively by combining self-responsibility
and self-organization with transformational
leadership. The structural management of
culture, organization, strategy and personnel
selection must support this. The fact that self-
control cannot be expected and demanded
from all employees in the same way will be
discussed in more detail later.
Policies (selection development and
advancement)
P8: Differentiated (self) selection, placement
and development in accordance with a
specific typology approach prevent
demands for exclusive or utopian-
collective behaviour.
Argument 8
Classical personnel management is still ±
under bureaucratic as well as under legal
postulates ± distinctly shaped by collective
personnel strategies. However, these are
insufficient for successfully promoting
internal entrepreneurship. As an alternative,
[ 204 ]
it is recommended that employees be divided
into teams based on their co-intrapreneurial
abilities and attitudes to avoid the utopian
idea that one may win all employees over. In
this context, a co-intrapreneurial typology is
more appropriate. First, it differentiates
among employees according to their co-
intrapreneurial capabilities and motivation.
In a second step, distinguished measures for
selection and advancement and their
situational implementation can be developed.
In our typology we attempt to make a
distinction between employees according to
their co-intrapreneurial competencies and
motivation. Initial self-assessments and self-
appraisals as well as assessments by direct
managers are of particular interest. Our own
surveys of three studies with Swiss and
German companies with four typology
groups ± described in Figure 7 ± are
particularly relevant here.
Such analyses still have to be conducted in
more detail; but the initial results point out
the extent to which one could or must
promote these co-intrapreneurial groups
using different HR policies. This segmenting
approach is a central component of the
necessary HR development of target groups,
as in a sequential way it is possible to assess
and promote key capabilities and
qualifications more specifically.
Conclusion 8
Realistic models for the advancement and
development of co-intrapreneurship demand
a rejection of exclusive approaches (e.g. only
for senior management) or of over-
generalized ideas focussing on collective
changes in behaviour for all employees.
Employees should be managed, developed
and promoted according to their individual
or potential degree of co-intrapreneurial
behaviour. Our typology enables a
differentiating analysis and strategy
according to the category of behaviour, key
capabilities, phases of development and
single components. In this way it
avoids utopian demands of ``perfect''
co-intrapreneurial behaviour from all
employees and promotes purposeful and
differentiated team building.
P9: Target-group-development complete
team-related and individualized
employee development.
Argument 9
A target-focused orientation allows specific
treatment of different levels of employees.
According to their level of problem-solving
competencies and social competencies, we
distinguish employees who withdraw
internally, employees with little
co-intrapreneurial competencies,
Rolf Wunderer Figure 7
Employees as
``co-intrapreneurs'' ± a Typology for analyzing entrepreneurship (3 studies, n = 240, 1998-99)
transformation concept
Leadership & Organization
Development Journal
22/5 [2001] 193±211

co-intrapreneurially motivated employees appropriately ± is an excellent instrument for

and co-intrapreneurs. Furthermore we add
sub-employers who are relatively
autonomous (e.g. managers of profit centers).
With this typolology, each target group
can receive appropriate support and
development. Figure 8 illustrates a simplified
model based on this typology.
In the context of promoting target groups,
team development plays an important role,
particularly because it can provide
employees ± with different levels of maturity
(Hersey and Blanchard, 1987) ± with
important balances and opportunities to
socialize This has been confirmed by
investigations on project groups, quality
circles and especially within semi-
autonomous group works (Adam, 1991;
Collins, 1995; Ehlan, 1994; Teare et al., 1997).
Even less-competent employees can be
purposefully included into group tasks in a
co-intrapreneurial manner. Furthermore, the
team is able to provide a good contribution to
peer group development. The promotion of
teams and target groups should, therefore,
take priority over collective personnel
policies, which concentrate on general
programs. Moreover, the team can suitably
distribute different role requirements to
individual members (Margerison and
McCann, 1985). Managers have the specific
task of individual support of the team ±
particularly in assisting them to help
themselves.
An individualized employee appraisal ±
when prepared and implemented
appraising one's own and others' individual
and team objects and performance. It also
encourages all participants to propose and
introduce subsequent HR development
measures, which suit their individual needs
and demands, allowing an appropriate
monitoring of success in the forthcoming
period.
Conclusion 9
We consider the typology approach, which
shows similarities to an portfolio analysis, to
be the central solution for developing,
leading and integrating employees, who
possess different co-intrapreneurial
competencies and levels of motivation into
social network, developing them and
increasing their capacity for self-
organization and development. However,
individual and mutual support within the
management dyad remains a central function
for line managers and their employees.
P10: Self-development and on-the-job
development conducted by managers
are ranked higher than central
personnel development and off-the-job
advancement.
Argument 10
Ultimately the development of co-
intrapreneurial potential is a task which
must be performed primarily by the
employees themselves in the context of their
individuation process (Jung et al., 1972). Self-
development engages employees in a
particular way as they are at the same time
[ 205 ]
Rolf Wunderer Figure 8
Employees as
``co-intrapreneurs'' ± a Typology for differentiated support of co-intrapreneurship
transformation concept
Leadership & Organization
Development Journal
22/5 [2001] 193±211
personally concerned and can act
accordingly.
Advantages of the co-operative self-
development process are that it:
. corresponds to aspirations for direct
self-responsibility;
. enables situation/need-specific solutions;
. ensures higher level of acceptance and a
sustainability of commitment; and
. offers alleviation and relief for managers.
However, unqualified employees should not
be overtaxed with demands of self-
development, which they are unable or
unwilling to fulfill. Here, the priority should
be to focus on the distribution of tasks
according to the aforementioned typology
approach as well as measures for selection
and appointment. It is important that line
managers assess the extent to which
objectives can be achieved by employees and
that they provide the necessary coaching or
motivation for increasing the capacity for
self-organization and development. The
manager is also mainly involved in on-the-job
development. According to our own surveys
with 41 HR directors of well-known Swiss
global players (Wunderer and Dick, 2000),
this includes, above all, participation in
projects, empowerment through more
important and varied tasks, leadership by
delegation, job rotation, more responsibility
for special tasks, and coaching or mentoring.
Furthermore, the survey confirmed the
increasingly decisive role of HR and the
[ 206 ]
transformation concept in the context of
change mangement. Additionally, to enhance
the co-intrapreneurial abilities of existing
members it will be important to design
specific corporate training and development
activities.
Conclusion 10
The first and last responsibility for
developing co-intrapreneurial competencies
and values lies within the employee him or
herself ± also in the context of employability,
which is the employee's responsibility too.
However, managers can and must provide
fundamental support in necessary cases.
Both senior management and the HR
department are responsible for ensuring that
self and on-the-job developments support the
co-intrapreneurial process.
Guiding principles for employees,
executives and HRM professionals
replace principles for classical
intrapreneurship
Promoting principles for employees
Observation 1
The following principles for promoting
co-intrapreneurship for employees are
derived from the aforementioned
transformation maxims. They have been
deliberately formulated to be analogous to
the ten principles for intrapreneurs by
Pinchot in order to emphasize the difference.
Rolf Wunderer 1 Over the long term, work only on tasks, in
Employees as organizations, and with people with
``co-intrapreneurs'' ± a which and with whom you can (still)
transformation concept
identify.
Leadership & Organization
Development Journal 2 Arrive at work every day with the general
22/5 [2001] 193±211 willingness be voluntarily committed.
3 Reduce motivational barriers and
demotivating practices as far as this can
be done by you on a self-organized basis.
4 Consider problems as a challenge and not
as a threat.
5 Attempt to develop better solutions to
problems in your everyday work. Analyze
your own focus and improve your key
intrapreneurial capabilities and those of
others.
6 Concentrate on results instead of input.
Pay particular attention to factors, which
benefit your stakeholder groups (e.g.
customers).
7 Reach your objectives ± within your given
scope for action ± preferably
independently and with self-
responsibility, but in accordance with a
strategy and as part of a team.
8 Work by co-operating over the long term
with others. Treat others as you wish to be
treated yourself.
9 Contribute to an organizational climate
and corporate culture of trust and support
team-building activities.
10 Participate in shaping the
co-intrapreneurial vision. Work with
what this vision means in your work-
place area.
Principles for executives and HRM
professionals
Observation 2
In addition to the principles for
co-intrapreneurial employees, the following
guidelines refer to executives and HRM
professionals to support and promote
co-intrapreneurship. They are ordered
according to our model of co-intrapreneurial
transformation (compare Figure 1).
1 Enhance the company value by orienting
towards the needs of central stakeholders.
Take social, environmental and ethical
responsibilities into account and express
the same in a written commitment.
2 Focus on co-intrapreneurial key
qualifications. Define, operationalize, and
communicate the key-qualifications
needed for co-intrapreneurship. Put them
into appraisals and use them for
development, career planing, and reward
systems).
3 Enable identification, motivation and
re-motivation. Take care with the
identification of your team, i.e. central
values, scripts and working relationships.
Concentrate first on the motivation for
dismantling de-motivating and impeding
working conditions and encumbering
processes. Support this by building up
action and responsibility competencies,
followed by a constructive interpretation
and shaping of the working situation that
gives it meaning and encourages learning.
Reduce motivational barriers and
demotivating practices (e.g. by removing
unnecessary controls or providing needed
resources).
4 Support adequate systems of co-ordination.
Demand internal and external market
thinking and organize accordingly.
Promote also a long-term, co-operative,
social network with relevant reference
groups. Organize by combining structures
and culture of internal market and social
networks, as realization of competition
and co-operation.
5 Manage with structural and interactive
leadership dimensions. Concentrate first of
all on providing supportive conditions
such as entrepreneurial management of
infrastructure (predominantly by
determining corporate culture, strategy
and organization). Foster mutual trust
and loyalty, as well as new ways of
approaching problem solving by adopting
an interactive and transformational style
of leadership of meaning.
6 Apply a more targeted and individualized
style of leadership and development.
Promote co-intrapreneurship through
self-development, qualification-specific
and differentiated and typology-related
leadership. With regard to qualifications,
concentrate on co-intrapreneurial core
competencies.
. Promote co-intrapreneurs by
encouraging, stimulating the work
situation and by preventing or
reducing motivational barriers and
demotivating factors.
. Train those who are open-minded
towards co-intrapreneurship by
concentrating on their less developed
core competencies. Prevent their
demotivation and appoint them to the
appropriate teams.
. Lead those employees who lack co-
intrapreneurial drive by training and
motivating them gradually and
continuously without over-taxing
them.
. Assist employees who suffer from
inner withdrawal, who are overtaxed,
or act as ``brakes'' on the system by
targeted placement, re-assignment, and
re-training programs for qualification
or, if necessary, by outplacement.
[ 207 ]
Rolf Wunderer 7 Attach more importance to targeted
Employees as selecting and development of employees.
``co-intrapreneurs'' ± a
transformation concept Focus on the employment of qualified and
motivated employees, and a well-founded
Leadership & Organization
Development Journal analysis of their potential. Then lead,
22/5 [2001] 193±211 place and promote the employees
according to their typology-specific
co-intrapreneurial abilities and interests.
Encourage learning and experimenting
for developing and implementing
new ideas, simultaneously tolerate
mistakes and failures. Support also
co-intrapreneurial team building and give
teams more control and freedom over how
their work gets done in a self-organized
way.
8 Reward effective and successful
co-intrapreneurial engagement and
performance (e.g. with financial or non-
monetary reward systems appropriate to
co-intrapreneurs). Be aware about the
threat of undermining intrinsic
motivation by using extrinsic incentive
and rewards tools.
9 Accept contradictory requirements
and develop the capacity to manage
paradoxes. Observe that leadership
demands contradictory requirements
from management and employees
(e.g. risk taking and reliable planning,
distance and closeness, trust and
control or equal and special
treatment). Consider this in the
written policies of leadership principles
and the formation of working
relationships.
10 Walk your co-intrapreneurial talk. Act
as a co-intrapreneur yourself, set
examples, learn and adjust, by being
responsive, co-operative and service
oriented.
Limitation and problems of the
transformation process
Besides the outlined opportunities, the
concept of co-intrapreneurship entails also
limitations and threats (Kuhn, 2000). The
following summarise the main limitations
and problems:
1 Limitations of structural leadership:
. changes in the organisational culture
and values are circumscribed and
possible only in the long run
(otherwise by replacement of
personnel);
. too decentralised organisation without
networks triggers the danger of ``self-
inc.'';
. target strategies do not correspond to
real ones.
[ 208 ]
2 Limitation of interactive leadership:
. insufficient qualification, motivation
or lack of time of executives;
. deficiency of basic requirements
(e.g. motivation or qualification of
employees, inappropriate style of
leadership).
3 Limitations of selection and development
(personnel structure):
. immature diagnosis for occupational
aptitude of key competencies;
. limited potential of intrapreneurial
qualified and motivated persons;
. insufficient requirements for
intrapreneurial organisation and
personnel development (e.g. capacity
readiness, learning culture).
4 Mis-interpretation or misuse of the concept:
. confusion with mere financial
incentive concepts (e.g. profit or equity
participation);
. danger of manipulation and
exploitation of employees;
. taking personal advantage of given
freedom by employees;
. misuse as marketing or PR concept for
self-presentation.
5 Mistakes and shortcomings during
implementation of the concept:
. overstraining employees ``all work
entrepreneurial'';
. reduction of well-sounding, isolated
guiding principles;
. trendy, straw-straw fire actions;
. missing integration with other HR
instruments;
. one-sided orientation towards top
management and executives;
. underestimating of required operating
expenditure and time input;
. one-sided demand for changes in
qualification and/or motivation;
. disregard for structural obstacles and
demotivation;
. non-systematic, non-targeted or
non-differentiated approach.
Conclusion
The paper has presented an integrated
framework of co-intrapreneurship. This
approach corresponds to an increasing
number of companies demanding internal
entrepreneurship as a needed requirement of
corporate practice. The advancement of
internal entrepreneurship poses
extraordinary challenges for management.
According to our surveys in 1997 and 1999
(Wunderer, 1999), HR managers believe that
they should play a more active role in
implementing and practicing
Rolf Wunderer co-intrapreneurship. In this respect, they
Employees as have special responsibility and are necessary
``co-intrapreneurs'' ± a determinants for ensuring that the co-
transformation concept
intrapreneurial transformation process will
Leadership & Organization
Development Journal be successful.
22/5 [2001] 193±211 If employed appropriately, co-
intrapreneurship can put efficient
collaboration and consensus into practice. In
this way, members of the organization can
experience a sense of fulfillment and
enhancement, in that their work provides
different entrepreneurial challenges and that
they have sufficient autonomy and a social
network to face and reconcile them.
The co-intrapreneurial transformation
process can by no means be achieved
overnight. The principle should be
incremental ± co-intrapreneurship by means
of continuous improvement. The
transformation from an envisioned ideal
culture to one of practiced culture of
co-intrapreneurship, has been introduced.
Increasingly, companies have taken the
initial steps by altering their corporate
vision accordingly. Its extensive
implementation will require further
theoretical and practical efforts, which will
also help to improve the recognition and the
handling of problems and the
aforementioned inherent limitations and
problems of the concept.
However, all in all we can let ourselves be
guided by the maxims of P.H. Kotler: ``There
are three types of companies: those who
make things happen, those who watch things
happen and those who wonder what
happened!''
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Organizational Strategies, Jossey Bass,
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