Measuring intrapreneurial innovativeness in the FMCG industry : the effects of organization-level factors on intrepreneurial innovativeness

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UNIVERSITY OF AMSTERDAM & FREE UNIVERSITY

Measuring

Intrapreneurial

Innovativeness in the

FMCG Industry

The Effects of Organization-level Factors on

Intrapreneurial Innovativeness

Chaim Ter Wee 4/9/2018

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PREFACE

You are about to read the Master Thesis ‘Measuring Intrapreneurial Innovativeness in the FMCG Industry: The Effects of Organization-level Factors on Intrapreneurial Innovativeness’. It has been written in order to meet the graduation requirements set by the University of Amsterdam and the Free University.

This research was developed, conducted and perfected between March of 2018 and July of 2018 with the assistance of my thesis supervisor Rein Denekamp, who I would like to thank for all the valuable insights, the wonderful cooperation and help when I required it. Most importantly, the fact that Denekamp has lots of practical knowledge and experience regarding business and intrapreneurship allowed me to make a better translation from theory to practice.

I would also like to thank all the respondents for helping me to get a basic grasp on the phenomenon of intrapreneurship and innovation. Additionally, I would like to thank Pieter van Herpen, founder and CEO of SyndicatePlus and CIO of Icecat, for bringing me in contact with these respondents within the Dutch FMCG industry.

Lastly, I would like to thank both the University of Amsterdam and the Free University for enriching my knowledge on the topic of Business Administration and Entrepreneurship, with a specialization on Intrapreneurship.

The author is solely responsible for the content of the thesis, including mistakes. The university cannot be held liable for the content of the author’s thesis.

Hierbij verklaar ik, Chaim Ter Wee, dat ik deze scriptie zelf geschreven heb en dat ik de volledige verantwoordelijkheid op me neem voor de inhoud ervan.

Ik bevestig dat de tekst en het werk dat in deze scriptie gepresenteerd wordt origineel is en dat ik geen gebruik heb gemaakt van andere bronnen dan die welke in de tekst en in de referenties worden genoemd.

De Faculteit Economie en Bedrijfskunde is alleen verantwoordelijk voor de begeleiding tot het inleveren van de scriptie, niet voor de inhoud.

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ABSTRACT

Background - The body of literature on intrapreneurship and innovation is extensive –

albeit, far from conclusive – but lacks the ability to explain precisely how intrapreneurs are influenced by organization-level factors. More specifically, there exists a literature gap on the effect of organization-level factors on individual intrapreneurial innovativeness. This research aims to bridge this gap.

Methods - This research was conducted through surveys filled in by intrapreneurs within the Dutch FMCG industry. The sampling strategy that was used was a combination of both probability-sampling as well as convenience sampling. The final sample size consisted of 52 usable respondents. Respondents were asked to disclose their innovativeness based on three measures: ideas discussed, ideas pitched and ideas accepted. They were also asked to what degree they were influenced by several organization-level factors (capital allocation strictness, funding availability and encouragement for calculated risk). The duration of the study lasted 4 months.

Results - The primary objective of this research was to find out if and how capital

allocation strictness, funding availability and encouragement for calculated risk influence individual intrapreneurial innovativeness. The results show that all three types of innovativeness are influenced differently by these three predictors. Number of ideas discussed only has a positive significant relationship (p = 0.028) with funding availability. Number of ideas pitched also has a positive significant relationship (p = 0.009) with funding availability, but also a negative significant relationship with capital allocation strictness (p = 0.014). Number of ideas accepted has a negative significant relationship with capital allocation strictness (p = 0.039) and a positive significant relationship with encouragement for calculated risk (p = 0.045).

Conclusions - There is not one specific answer to the research question provided in this

study. Rather, there are multiple answers possible depending on which type of innovativeness you are interested in. However, if a Dutch FMCG company would aim to create an organizational environment that is capable of fostering intrapreneurial innovativeness throughout the entire chronological lifecycle of an idea, minimizing capital allocation strictness, maximizing funding availability and maximizing encouragement for calculated risk would be proper first steps toward realizing this.

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INTRODUCTION

Since the invention of the word “intrapreneurship”, by Pinchot and his wife (1978), the concept has been thoroughly studied. The large majority of the literature on the topic of intrapreneurship has focused primarily on assisting large organizations with valuable insights on increasing their innovative capacity. Some research, with similar intentions, has been conducted on the impact of intrapreneurs within SMEs (Carrier, 1994). Most – if not all – research show ample evidence that intrapreneurial activities can, indeed, positively influence organizational outcomes (Gawke et al., 2017).

Less research has been conducted on the effect of the intrapreneurial environment (such as organizational culture, organizational structure, capital availability) on intrapreneurial success. Still, innovative success of the intrapreneur relies on the organizational environment as much as the innovative success of an organization relies on the intrapreneur (Balasundaram & Shahab Uddin, 2009). Accordingly, Kuratko et al. (1990) have identified various scales that impact intrapreneurial success. Similarly, Balasundaram & Uddin (2009) have developed determinants of key favorable environments for intrapreneurship development. Evidently, some research has been done on the effect of the intrapreneurial environment on its fit with intrapreneurship, but it is far from conclusive.

In the end, for most organizations, intrapreneurs are valued based on their ability to innovate and create new opportunities for the company to pursue. It is, thus, of importance for academic and practical purposes to research intrapreneurial success based on actual innovativeness and how this is influenced by organization-level factors. This will greatly improve the practical relevance of academic research on the topic, as top-management will have a better understanding of the value of the intrapreneurs within their organization and how to properly support their innovative capacity.

But how researchers such as Kuratko et al. (1990) and Balasundaram & Uddin (2009) measure intrapreneurial success is based on the emergence of intrapreneurship within the boundaries of a company and the management team’s perception of intrapreneurial success. They do not research specifically the intrapreneurial success based on the innovativeness of the intrapreneur within the company. Naturally, perceptions are useful in researching nascent topics – which the topic of intrapreneurship was at the time of Kuratko et al.’s (1990) research and can still be considered as such – but since the body of research on intrapreneurship is slowly growing out of nascence, qualitative perceptions no longer provide a lot of new, valuable information.

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Additionally, the research conducted by Kuratko et al. (1990), and many other similar studies (Douglas & Fitzsimmons, 2013; Bosma & Stam, 2010; Felício et al., 2012), are very broadly themed and don’t deep dive into their subjects of interest. For instance, factors of the intrapreneurial environment such as funding and budget processing are researched and discussed very briefly and are not explained in relationship to intrapreneurial innovativeness, rather in relationship to qualitative measures of intrapreneurial success (such as the management team’s perception of the influence of budget allocation on performance). In order to get better insights in how the intrapreneurial environment influences intrapreneurial innovativeness – and, ultimately, the organizational innovative capacity – it is important to devote time to researching more well-defined and specified environmental factors as influencers of intrapreneurial innovation.

Research Scope

Thus, in order to establish greater validity – both internal as well as external – the focus of this research will be limited, albeit well-defined. This research will be centered mostly around the financial factors of the intrapreneurial environment and their effects on intrapreneurial innovativeness, with the addition of the degree of encouragement for taking calculated risk. This focus is of relevance due to the importance of careful capital planning and allocation within every organization.

On the one hand, an important organization-level factor of the intrapreneurial environment that will be studied is the capital allocation strictness of the organization; the degree to which an intrapreneur relies on the company’s willingness to allocate money to new ideas and the strictness of the budget allocation strategy itself. Similar to any other venturing or investment opportunity, intrapreneurial endeavors require financial resources. However, where entrepreneurs have the option of using their own resources in any way they see fit, intrapreneurs are bound by the organizational willingness to allocate resources to intrapreneurial opportunities. It could be beneficial for an organization to know how the intrapreneurial innovativeness is impacted by various funding processes and capital allocation strategies, as tradeoffs have to be made in order to find the sweet spot.

On the other hand is it important to note that the availability (or absence) of funding could also prove to be an important factor that influences intrapreneurial innovativeness. After all, how does the organizational capital allocation strictness influence intrapreneurial innovativeness if there is no dedicated budget for intrapreneurial endeavors in the first place?

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Moreover, does a bigger budget for intrapreneurial endeavors really lead to more innovative intrapreneurs?

And, ultimately, conjectural reasoning suggests that the degree to which the top management encourages intrapreneurs to take calculated risk would seem to be of influence on the budgeting protocols as described above. Once again, the notion would be that encouragement for calculated risk could directly or indirectly influence intrapreneurial innovativeness.

Conclusively, the question that arises is: how do these organization-level factors impact the innovativeness of an intrapreneur? Moreover, how do you measure intrapreneurial innovativeness? This is a topic that has not been definitively studied and requires additional insights – preferably based on quantifiable data, as argued by Alpkan et al. (2010) – in order to make valuable statements regarding their relationship.

Industry

This research was conducted in the Fast Moving Consumer Goods (FMCG) industry in the Netherlands. FMCG products are frequently purchased essential or non-essential goods such as food, toiletries, soft drinks, that spend short amounts of time on the shelf. Some examples of the largest FMCG producers with offices in the Netherlands are Nestlé, Pepsico, Procter & Gamble, Unilever, FrieslandCampina and Heineken.

All these companies have a strong focus on delivering new products to their consumers. This is reflected in their large innovation and R&D teams and divisions and is often specified in their annual reports. However, Zairi (1995) has identified that there are multiple problems in the FMCG industry that can potentially limit innovation. For instance, there are enormous numbers of stakeholders involved in a new brand, power breakers can stifle processes if they so wish, there is vast bureaucracy, there is strong internal competition, spending more time justifying things than making them happen, etc. (Zairi, 1995). Clearly – at the time of Zairi’s research on the FMCG industry – the industry was not yet designed properly to maximize cross-organizational innovativeness.

Still, Zairi’s research was conducted over 20 years ago, so a lot could have changed. Strangely enough, finding newer, additional research on innovation in the FMCG industry proves difficult if not impossible. Hence, assuming that Zairi’s (1995) research still applies today, companies that operate in the FMCG industry could benefit greatly from grasping and understanding the effects from organization-level factors on intrapreneurial innovativeness, as

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it would allow them to design the intrapreneurial environment in such a way that it would most properly support intrapreneurial innovativeness and increase organizational innovative performance.

Research Question & Sub-Questions

The introduction of this paper has led to the formulation of the following research question: To what degree is the innovativeness of an intrapreneur in the FMCG industry influenced by capital allocation strictness, funding availability and encouragement for calculated risk? This research question captures all three organization-level factors of the intrapreneurial environment as previously described. Moreover, it sets a clear boundary and scope by focusing on the innovativeness of the intrapreneur, rather than the success of the intrapreneur, thus minimizing ambiguity. De Jong & Wennekers (2008) made a thorough conceptualization of the intrapreneur and they argue that “intrapreneurship is supposed to inherently contain an element of innovation”. Thus, along with other factors such as proactiveness and self-renewal, innovativeness is a good indicator of intrapreneurial behavior. The operationalization and measurement of the innovativeness variable will be discussed in the methodology chapter of this research.

Aside from the main research question, several sub questions will be investigated and aimed to be answered. These sub questions are given below:

 What types of intrapreneurial innovation can be distinguished?

 What are specific characteristics of innovation in the FMCG industry?

 To what degree is the innovativeness of an intrapreneur influenced by capital allocation strictness?

 How is the innovativeness of an intrapreneur impacted by the availability and absence of funding?

 How does the top management’s encouragement for calculated risk impact the innovativeness of an intrapreneur?

 How does the top management’s discouragement of calculated risk impact the innovativeness of an intrapreneur?

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Conceptual Model

Below is visualized the conceptual model of this paper. Positive correlations are predicted between the availability of funding, the encouragement for calculated risk, and the innovativeness of the intrapreneur. A negative correlation is predicted between the capital allocation and the innovativeness of the intrapreneur.

Figure 1. Conceptual Model

LITERATURE REVIEW

In this literature review I will discuss relevant theories regarding intrapreneurship and innovation, providing clear definitions of key constructs and clear explanations of previous work consonant to this research topic. The aim of this literature review is to establish an academic infrastructure on which the remainder of this research will be based. The scope of this literature review will be constrained to the two central topics that the research question of this paper features: intrapreneurship and innovation.

Firstly, the intrapreneurship construct will be defined specific to this research. Secondly, the relevant literature on the correlation between intrapreneurship and innovation will be outlined. Thirdly, the personality traits of intrapreneurs will be discussed and, lastly, the literature on the intrapreneurial environment will be reviewed.

Defining Intrapreneurship

When Pinchot and his wife first coined the term ‘intrapreneurship’ in a paper titled Intra-Corporate Entrepreneurship (1978) , heavy debate led to the development of a more well-developed and conclusive understanding on the topic in the form of a book called Intrapreneuring (Pinchot, 1986). In this book Pinchot defined intrapreneurship as “the act of

CAPITAL ALLOCATION STRICTNESS FUNDING AVAILABILITY ENCOURAGEMENT FOR CALCULATED RISK INNOVATIVENESS OF THE INTRAPRENEUR

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behaving like an entrepreneur while working within a large organization”. However, in 2017 – 32 years later – Pinchot still demonstrates that (similar to the term ‘entrepreneurship’) there is not one single truth regarding the definition of intrapreneurship; in 2017 Pinchot offers four more potential definitions to consider: “(1). Intrapreneurs are employees who do for corporate innovation what an entrepreneur does for his or her start-up. (2). Intrapreneurs are the dreamers that do. (3). Intrapreneurs are self-appointed general managers of a new idea. (4). Intrapreneurs are drivers of change to make business a force for good” (Pinchot, 2017).

Evidently, the existence of various understandings of intrapreneurship calls for one well-specified definition for this research. Thus, in order to build a layer of mutual understanding, this research will define intrapreneurship in the same way Antoncic and Hisrich (2003) define the concept: “intrapreneurship is defined as entrepreneurship within an existing organization, referring to emergent behavioral intentions and behaviors of an organization that are related to departures from the customary”. This definition is adopted because one of the focal points of this research is innovation, which is captured by Antoncic and Hisrich’s (2003) definition by specifying the importance of departures from the customary. Additionally, Antoncic & Hisrich are considered among the leading academics on the topic of intrapreneurship, thus allowing me to assume that other scholars would agree with the chosen definition of the topic. As follows, all further instances of the term intrapreneurship in this research are based on this given definition.

Intrapreneurship and Innovation

Most academic research on the topic of intrapreneurship highlight the innovative capacity of intrapreneurs. There exists a consensus on the idea that management teams can benefit greatly from hiring or training intrapreneurs within their organizations due to the innovative capacity that they bring to the organization. Thus, in this paragraph the academic research on the relationship between intrapreneurship and innovation will be reviewed and discussed.

Ghoshal & Bartlett (1995) discuss the importance for large organizations to continuously innovate in order to maintain their competitive advantage. They argue that many large, diversified organizations that used to flourish prove incapable of adapting to instability, high competition and capital plenty. Their research suggests that large organizations that actually are capable of adapting to volatile environments have clear intrapreneurial strategies. These strategies support employee initiatives aimed towards innovation and organizational development.

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Accordingly, Seshadry & Tripathy (2006) state that “intrapreneurial innovation serves as the growth engine for the company”. When a company properly facilitates intrapreneurship – through, for instance, accurate reward policies, sharing of success stories and constant reminders of the vision and mission of the company – it can generate very efficient and effective innovative environments. Moreover, Seshadry & Tripathy (2006) argue that intrapreneurial individuals are valuable assets to organizations that strive to remain competitive within their market. Their innovativeness “results in generating new avenues for business growth or alternately provides radically different ways of doing existing business. Every company requires new ideas to survive and grow profitably and, hence, it has to find ways to tap the entrepreneurial potential inherent in its employees” (Seshadry & Tripathy, 2006).

Correspondingly, Pearce & Carland (1996) studied intrapreneurship and its effect on innovations. Their results show that innovative performance in organizations with high levels of intrapreneurship was significantly better than those organizations with low levels of intrapreneurship. Similarly, Felício et al. (2012) found the same relationship between intrapreneurship and organizational innovation. They studied the influence of intrapreneurship on the performance of companies. The results show that “intrapreneurship has obvious effects on the measures of qualitative performance – growth and improvement” (Felício et al., 2012).

The fact that business as usual has transformed into information and communication-intensive practices, has led companies to be forced to work more closely with customers. Accordingly, customers expect faster developments and improvements as a result of the growing volatility and growth within markets. Consequently, Gündoğdu (2012) argues that companies need to be fully dedicated to innovation through means of intrapreneurship in order to survive. He defines intrapreneurs as people who “show talent in adapting to dynamically changing conditions of the environment; responding to evolutionary expectations of customers even simultaneously, getting an inkling of innovation and marketing it in the first place” (Gündoğdu, 2012).

Additionally, while research clearly displays the relevance and importance of intrapreneurship on organizational competitive advantage, Bosma et al. (2010) find that, still, less than 5 percent of employees in general are intrapreneurs. They suggest that this could be the case due to the tendency of intrapreneurs to have intentions to start a new independent business, leaving the company as a result. Moreover, Bosma et al. (2010) argue that organizational environments that are not properly designed to facilitate and foster intrapreneurship can lead to lower general levels of intrapreneurship within organizations.

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Evidently, additional research has to be done on how to ‘create’, ‘maintain’ and ‘foster’ intrapreneurship in the long run.

Thus, even assuming intrapreneurs were inherently innovative individuals, it would not mean that having an intrapreneur within the organization naturally leads to improved organizational innovativeness and corporate performance. This is where the topic of this research becomes a key factor: the organizational environment in which the intrapreneur operates. Take for instance the size of the organization; “the bigger the organization the more difficult it is to have an overview of the actions of every employee” (Zenovia, 2011). But also a lack of communication, a general sense of internal competition, unsupportive feedback in case of success/mistake and strong hierarchies are elements of the environment that Zenovia (2011) finds to be unsupportive of intrapreneurship and, indirectly, corporate innovation. Needless to say, many additional environmental factors can influence the efficiency and effectivity of an intrapreneur.

Thus, while intrapreneurs can definitely have a positive impact on innovation, both on the corporate as on the individual level, that does not inherently mean that hiring intrapreneurs leads to enhanced innovative performance; there are more elements that play crucial roles in the facilitation of intrapreneurship and innovation.

Personality Traits of Intrapreneurs

In addition to the external environment of the intrapreneur that could influence innovativeness, the internal personality proves equally important. Multiple academics on the topic of intrapreneurship have researched the fundamental personality traits of individual intrapreneurs. After all, the simple fact that intrapreneurs possess valuable innovative skills and personalities that differ from other employees, makes researching their personality so important. What is it that makes intrapreneurs that much more inclined to be innovative than others within the organization? How can organizations recognize intrapreneurial personalities early? In this paragraph I review multiple influential papers in order to formulate a meta-conceptualization of intrapreneurial personality traits.

In order to formulate a meta-conceptualization of intrapreneurial personality it is paramount to determine whether there exists merely one intrapreneurial personality or if there are multiple types of intrapreneurial personalities. Sayeed & Gazdar (2003) argue that, in fact, there are seven distinguishable intrapreneurial types, each containing a particular trait and corresponding attributes. The intrapreneurial types as described by Sayeed & Gazdar (2003)

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are: the innovator, the new designer, the leader, the entrepreneur, the animateur, the adventurer and the change agent.

Shetty (2004) expands Sayeed & Gazdar’s (2003) research by attempting to distinguish overarching characteristics that, to some degree, represent all types of personality traits of the various types of intrapreneurs. He finds that need for achievement, drive to innovate, personal control, self-esteem and opportunism are all positively correlated with intrapreneurial attitude orientation. Thus, all the intrapreneurial types as proposed by Sayeed & Gazdar (2003) should generally possess the personality traits mentioned by Shetty (2004).

The discussed researchers (Sayeed & Gazdar, 2003; Shetty, 2004) have developed a more well-defined understanding of the intrapreneurial personality. Their research was based on multiple earlier researchers such as McGinnis & Verney (1987), Miller and Friesen (1983), Covin and Slevin (1986, 1991) and others, who were among the first to develop conceptualizations of behavioral and personal characteristics of organizational level entrepreneurship.

McGinnis & Verney (1987) have developed a framework in which they create a layered structure of individual qualities of intrapreneurial personalities. The three core elements of intrapreneurial personalities, as described by McGinnis & Verney (1987) are the presence of a clear vision, the ability of the individual to be self-motivating and a tendency to have a killer instinct when it comes to down to taking opportunities.

McGinnis & Verney (1987) argue that qualities that fall under the label ‘vision’, attribute to “the ability to integrate past experiences into new arrays that permit one to be innovative”. Qualities that fall under ‘self-motivation’ attribute to “the ability to engage in activities for their intrinsic rewards”. And lastly, qualities that fall under ‘killer instinct’ attribute to the ability of an innovative individual to know when to push forward and when to back off (McGinnis & Verney, 1987). Still, they elaborate on these core elements by linking them with more distinct and measurable personality traits.

The lower-tier personality traits of intrapreneurial personalities, as described by McGinnis & Verney (1987), are belief in innovation, creative but pragmatic imagination, psychological security and autonomous nature, achievement orientation, interpersonal skills, energy determination and persistence, and sense of timing. Taking into consideration Antoncic & Hisrich’s (2003) meta-conceptualization of individual level corporate entrepreneurship, it seems that McGinnis & Verney have missed the intrapreneurial trait of being inclined to take risk, as multiple other academics have concluded that inclination to take

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risk could, in fact, be described as an intrapreneurial personality trait (Miller & Friesen, 1983; Covin & Slevin, 1991; Lumpkin & Dess, 1996).

Comparing the older literature on the personalities and behavioral traits of intrapreneurs (McGinnis & Verney, 1987; Miller & Friesen, 1983; Covin & Slevin, 1986, 1991) with newer literature on the same topic (Sayeed & Gazdar, 2003; Antoncic & Hisrich, 2003; Shetty, 2004), it would seem that the same fundamental conclusions still hold today. The core new insights into intrapreneurial personality stem from the formulation of new intrapreneurial types by Sayeed & Gazdar (2003), rather than the discovery of new personality traits. However, for this particular research the typology of intrapreneurs is irrelevant, so it will be disregarded.

Thus, ultimately, creating a meta-conceptualization of intrapreneurial personality traits comes down to reviewing older and newer literature and combining them in order to create a foundational understanding of the personality traits of intrapreneurs. See Exhibit 1 for all of the most relevant and most widely agreed upon personality traits of intrapreneurs.

Personality Trait Sources

Drive to innovate Antoncic & Hisrich (2003), Miller & Friesen (1983), McGinnis & Verney (1987), Covin & Slevin (1986, 1991), Zahra (1991, 1993), Lumpkin & Dess (1996), Knight (1997), Shetty (2004).

Originality Sayeed & Gazdar (2003), McGinnis & Verney (1987).

Need for achievement Sayeed & Gazdar (2003), McGinnis & Verney (1987), Lumpkin & Dess (1996), Antoncic & Hisrich (2003).

Opportunity recognition Sayeed & Gazdar (2003), McGinnis & Verney (1987). Persistence Sayeed & Gazdar (2003), McGinnis & Verney (1987).

Inclination to take risk Sayeed & Gazdar (2003), Antoncic & Hisrich (2003), Miller & Friesen (1983), Covin & Slevin (1986, 1991), Lumpkin & Dess (1996).

Need for autonomy Sayeed & Gazdar (2003), McGinnis & Verney (1987), Lumpkin & Dess (1996), Antoncic & Hisrich (2003).

Proactiveness Shetty (2004), Antoncic & Hisrich (2003), Miller & Friesen (1983), McGinnis & Verney (1987), Covin & Slevin (1986, 1991), Lumpkin & Dess (1996), Knight (1997).

Exhibit 1. Meta-conceptualization of intrapreneurial personality traits

In the remainder of this research the personality traits as stated in Exhibit 1 will be assumed to be conclusive. This entails that the assumption will be made that all well-functioning intrapreneurs possess – to some degree – the personality traits that have been discussed in the academic literature as descriptive of intrapreneurs.

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Configuration of the Intrapreneurial Environment

During the first paragraph of this literature review I have already briefly touched upon the fact that intrapreneurship does not inherently lead to innovative success. There are more factors that influence the innovativeness of an intrapreneur. One of those factors is the degree to which the personality of the, supposedly, intrapreneurial individual corresponds with the personality traits as displayed in Exhibit 1 of the previous paragraph. Another very important factor that moderates the innovativeness of the intrapreneur is the degree to which the environment is designed in such a way that it is capable of properly fostering and facilitating intrapreneurial innovation. In this paragraph, the academic literature on the external organizational environment of the intrapreneur in relationship with intrapreneurial accomplishment will be reviewed and discussed. Similar to the previous paragraph, I aim to provide a clear understanding of the reviewed literature in relation with my independent variables.

An intrapreneur is in essence an employee of an organization who is partly responsible for maintaining the competitive advantage of the organization. An intrapreneur uses resources and capital provided by the organization, the risk is taken by the organization, and an intrapreneur is dependent upon the success of the organization (Surbhi, 2016). Thus, it can be assumed that the success of an intrapreneur heavily relies on the organizational environment and the degree to which the environment is capable of properly facilitating intrapreneurship. But to which degree is the intrapreneurial innovativeness moderated by organizational characteristics?

The first to have conducted research in this area were Kuratko et al. (1990), who have attempted to develop an instrument for measuring and creating an environment that is capable of fostering and growing intrapreneurship within organizations. In their research they argue that there exist multiple organizational factors that influence the intrapreneurial environment. The most relevant factors that can be applied to this research are: top management experience with innovation, top management sponsorship and encouragement for calculated risks, availability of funds, lack of funding, problems with company budget process and additional rewards and compensations (Kuratko et al., 1990). According to their research, the above mentioned factors show significant relationships with the emergence of intrapreneurship within organizations.

Additionally, Balasundaram & Uddin (2009) have conducted very similar research – 19 years following Kuratko et al.’s (1990) research – and found even stronger relationships with regards to the emergence of intrapreneurship within organizations. Evidently, these

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elements are relevant for this research as they describe the importance of encouragement for calculated risk as well as the importance of sponsoring of intrapreneurial projects.

In addition to the previously discussed literature, Antoncic & Hisrich (2007) have researched environmental factors and their correlation with the presence (or absence) of intrapreneurship within organizations. They argue that the most important organizational factor that could positively influence intrapreneurship within organizations is organizational support. Unfortunately, Antoncic & Hisrich (2007) do not clearly specify what type of organizational support they studied (encouragement, facilitation, dedicated budgets etc.). This is especially unfortunate since Kuratko et al. (1990) did specify very clearly their assessment criteria for organizational support, but their research is – at the time of writing – 28 years old and a lot could have changed over the years. Therefore, in the following sub-paragraphs I aim to distinguish a more precise understanding of organizational support by splitting it up into multiple factors.

Capital Allocation Strictness

In this research the capital allocation strictness can be specified as the degree to which the intrapreneur’s innovativeness relies on the organization’s willingness to allocate capital to intrapreneurial endeavors. An organization that employs a strict capital allocation culture with regards to intrapreneurial endeavors is less likely to flexibly allocate capital to the ideas that the intrapreneur brings forward. In contrast, an organization that employs flexible rules and protocols when it comes down to capital allocation with regards to intrapreneurial endeavors, is more likely to flexibly allocate capital to the intrapreneur.

The question that arises is whether the strictness with which the organization allocates capital to intrapreneurial ideas is influenced by the culture within the organization or by the formalized protocols. Reichartz & Weinert (2016) suggest the importance of support from both an enabling culture as well as formalized programs in order to stimulate intrapreneurship within the organization. An interesting find deriving from their study is that the culture of an organization can – over time – be shaped by gradually designing and adapting the formalized programs to support intrapreneurship. This means that most organizations should be capable of supporting cultural change through formalized change (Reichartz & Weinert, 2016). They argue that one of the many characteristics of an enabling formalized program with a positive relationship to intrapreneurial emergence is the willingness of the organization to support the intrapreneur through flexible funding; employing minimal capital allocation strictness.

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In addition, Kuratko et al. (1990) show how problems with the company budgeting process increase the overall capital allocation strictness, thus discouraging intrapreneurial emergence within the organization. Moreover, organizational support, and more specifically, sponsoring of intrapreneurial projects have proven to have a significant impact on intrapreneurial emergence and fit (Balasundaram & Uddin, 2009; Antoncic & Hisrich, 2007).

Conversely, Van Der Sijde & Veenker (2013) find that the emergence of intrapreneurship is not actually influenced by organization-level factors such as the strictness of capital allocation, because intrapreneurial intentions derive, more often than not, from intrinsic motivations. They do, however, argue that these organization-level factors have an impact on the intrapreneurial organizational conditions and, thus, the job satisfaction of the intrapreneur.

However, where these researchers (Kuratko et al., 1990; Reichartz & Weinert, 2016; Balasundaram & Uddin, 2009; Antoncic & Hisrich, 2007; Van Der Sijde & Veenker, 2013) put the heaviest emphasis on the capital allocation strictness in relation to the ‘emergence’ of intrapreneurship within the organization, this research aims to provide a deeper and more holistic picture of how formalized funding programs – and most specifically the strictness of capital allocation – directly influence the intrapreneurial ‘innovativeness’. Still, the conclusions made by previous scholars do show that capital allocation strictness is negatively correlated with emergence of intrapreneurship. Assuming that a lower degree of intrapreneurial emergence could also indicate a lower degree of individual intrapreneurial innovativeness, the following hypothesis can be drafted:

H1: The more strict the capital allocation, the lower the intrapreneurial innovativeness, and vice versa.

Availability of Funding

Aside from Kuratko et al.’s (1990) research, the funding element with regards to intrapreneurial innovativeness could also be somewhat logically assumed. However, assumptions are never conclusive in academic research, so it still requires additional research in order to get convincing evidence. The general assumption would be that intrapreneurial endeavors, similar to any other business endeavor, require money in order to succeed. Hence, when there is plenty of funding available for intrapreneurial endeavors, more intrapreneurial ideas should be developed than if there wasn’t enough money available. Still, this assumption

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concerns mainly the amount of intrapreneurial endeavors within an organization; it does not focus on the effect of funding availability on the actual innovativeness of the intrapreneurs.

Accordingly, Reichartz & Weinert (2016) suggest the importance of the size of a dedicated budget that is available within the organization to support intrapreneurial endeavors. Also De Jong & Marsili (2006) researched the impact of a dedicated innovation budget on innovative performance of the firm. They find that there are more companies that tend to dedicate time to innovation (69%) than those who reserve a dedicated budget (50%). Moreover, their results show that companies that dedicate more capital to innovation are also more effective at cross-organizational innovative performance. However, their research does not focus on the effect of funding on the individual innovativeness of the intrapreneur; rather it focuses on the general effect of funding availability for innovation on cross-organizational innovative performance. So, where previous scholars approach the phenomenon from an organizational level, I aim to examine the relationship on an individual level.

Similarly, if we look at it from the other way around it would make sense for an intrapreneur to be able to develop less ideas if the organizational culture – along with its formalized funding mechanisms – does not support intrapreneurship properly. After all, de Jong & Marsili’s (2006) research shows that there is a positive correlation between funding availability and innovative performance.

Moreover, Aygün et al. (2010) have researched the effect of funding availability on intrapreneurship in small and medium-sized enterprises in Turkey. They find that a bigger budget available for intrapreneurial ideas leads to a bigger chance of the intrapreneur’s ideas to be accepted by the decisions makers. Assuming that number of ideas accepted can serve as a proxy for intrapreneurial innovativeness, the results of Aygün et al’s. (2010) research conjecturally suggest that the same could be the case for intrapreneurs in Dutch FMCG companies. Still, big differences exist between SMEs and multinational FMCGs.

Additionally, where other studies have mainly specified and researched the effect of availability of funding on innovative performance of the organization, this research assumes a more pragmatic approach by specifically focusing on the effect of funding on the individual innovativeness of the intrapreneur. Still, the conclusions made in previous literature (Kuratko et al., 1990; Reichartz & Weinert, 2016; De Jong & Marsili, 2006) do show that innovativeness – albeit, ‘organizational’ rather than ‘individual’ – is negatively influenced by low availability of funding. Assuming that a lower degree of availability of funding could also indicate a lower degree of individual intrapreneurial innovativeness, the following hypothesis can be drafted.

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H2: The more money available for intrapreneurial endeavors, the higher the intrapreneurial innovativeness, and vice versa.

Encouragement for Calculated Risk

The final element of importance as described by this research and Kuratko et al (1990) is the top management’s encouragement for calculated risk. Once again, this paragraph captures an effect that could be logically assumed, but misses factual research: the effect of the encouragement for calculated risk on the individual innovativeness of the intrapreneur. Hornsby et al. (2002) argue that the encouragement for calculated risk is a factor that is twofold. On the one hand it entails the actual active encouragement of top management for employees to spot opportunities and execute potential ideas that may arise in their heads.

Nowadays, most organizations recognize the importance of innovation, thus stimulating employees to be innovative within the boundaries of the company. In many industries it is even crucial to focus on continuous innovation, as quick technological developments have rendered sustainable competitive advantage unachievable (McGrath, 2013). Mulgan & Albury (2003) argue that there are multiple ways for organizations to make their employees engage in innovative practices. One of those ways is the encouragement of radical thinking; encouraging the employees to think outside-of-the-box and allowing them to take calculated risks. Seemingly, there exists a positive relationship between encouragement to take calculated risk and the innovative performance of the organization (Mulgan & Albury, 2003). For the sake of their competitive advantage it is, thus, of relevance for organizations to devote time and effort into encouraging employees to take calculated risk.

However, Hornsby et al. (2002) argue that many organizations fail at the second implication of encouragement for calculated risk; tolerance for failure. “Middle managers must perceive an environment that encourages calculated risk taking while maintaining reasonable tolerance for failure.” (Hornsby et al., 2002). Hornsby et al. (2002) suggest that many organizations incorrectly implement encouragement for calculated risk, as they do not have proper tolerance for failing endeavors. For instance, Morse (1986) discusses how a company called ARCO was happy to announce that a team of young managers succeeded at developing an innovative marketing campaign after encouragement by the top management. However, when the executive was asked how the company would handle employees that experiment with projects that end up failing he answered the following: “That is a very good

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question. I must confess that we have not yet developed a way to deal with that situation. It does seem clear however, that once a managers project has failed, it will be difficult to promote him in the future” (Morse, 1986). This is a prime example of a company that wants its employees to be innovative but lacks proper techniques to tackle failing projects.

For this research, however, the tolerance for failure aspect of encouragement for calculated risk is regarded as a control variable rather than an independent variable. This is the case since every intrapreneur that filled out the survey answered that they did not fear repercussions if their intrapreneurial endeavors failed. This could be potentially be explained by the gap of approximately 16 years between Hornsby et al.’s research (2002) and the research that you are now reading.

Still, given this, the only effect of encouragement for calculated risk on which I will base a hypothesis is the actual encouragement itself. Previous scholarly papers have uncovered the positive correlation between active encouragement for calculated risk on company-wide innovative performance (Kuratko et al., 1990; Mulgan & Albury, 2003) . Assuming that increased company-wide innovative performance could also indicate a higher degree of individual intrapreneurial innovativeness, the following hypothesis can be drafted.

H3: The higher the top management’s encouragement for calculated risk, the higher the intrapreneurial innovativeness

Literature Gap

Many academics have written about intrapreneurship. It is now clear that configurations of the environment of an intrapreneur heavily influence the efficiency and effectivity of an intrapreneur. However, this literature review has surfaced a literature gap that is of interest both academically as well as practically. On the one hand it is evident that intrapreneurs are important for large organizations to remain innovative. Also, it is clear that intrapreneurs are influenced by external organization-level factors. Still, most researchers (Kuratko et al., 1990; Hornsby et al., 2002; Antoncic & Hisrich, 2007; Balasundaram & Uddin, 2009; Reichartz & Weinert, 2016; Mulgan & Albury, 2003; Hornsby et al., 2002) focus primarily on the degree to which the organizational environment is capable of growing intrapreneurship within the organization. Research has yet to be conducted for uncovering the extent to which these elements influence the actual innovativeness of an individual intrapreneur. For instance, how is the innovativeness of an intrapreneur impacted when there are no available funds? How is

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the innovativeness of an intrapreneur impacted when there are available funds aplenty? Also, how does the company budget process impact the innovativeness of an intrapreneur? What about the top management’s encouragement for, or discouragement of, calculated risk? These are all questions that could be answered by specifically researching their relationships with individual intrapreneurial innovativeness.

Summarization of the Intrapreneurship Literature

In Exhibit 2 are given the variables of interest for this research and the most important literature on these very subjects. Evidently, not all variables have been researched under the exact same definitions; rather, comparable items were assumed to be representatives of similar constructs.

Exhibit 2. Meta-understanding of organizational characteristics influencing intrapreneurship

The main takeaways of the discussed literature on intrapreneurship are that:

 Intrapreneurship is defined as entrepreneurship within an existing organization, referring to emergent behavioral intentions and behaviors of an organization that are related to departures from the customary.

 Intrapreneurs can have a positive impact on innovation, but there are more elements that play crucial roles in the facilitation of intrapreneurship and innovation.

 Successful intrapreneurs tend to possess a set of personality traits that differs from unsuccessful or non-intrapreneurs.

Variables Similar literature

Encouragement for calculated risk Encouraging the actions (Balasundaram & Uddin, 2009)

Organizational support (Antoncic & Hisrich, 2007) Encouragement for calculated risk (Kuratko et al., 1990; Hornsby et al., 2002; Mulgan & Albury, 2003) Tolerance for failure (Hornsby et al., 2002)

Funding availability Top management sponsorship (Kuratko et al., 1990) Lack & availability of funding (Kuratko et al., 1990) Funding leniency (Reichartz & Weinert, 2016)

Capital allocation strictness Problems with company budget process (Kuratko et al., 1990)

Organizational support (Antoncic & Hisrich, 2007) Sponsoring of intrapreneurial projects (Balasundaram & Uddin, 2009)

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 The organizational environment has a big influence on the success of intrapreneurs.

 Capital allocation strictness is negatively correlated with the emergence of intrapreneurship within the boundaries of an organization.

 Innovativeness – albeit, ‘organizational’ rather than ‘individual’ – is negatively influenced by low availability of funding.

 There exists a positive correlation between active encouragement for calculated risk on company-wide innovative performance.

 The relationship between organization-level factors and intrapreneurial ‘innovativeness’ has not yet been definitively studied.

METHODOLOGY

This methodology section outlines how the research was conducted. The research question will be stated once more, the methodology and design of the research will be discussed, the sampling strategy will be outlined and the methods for data collection and data analysis will be described. The methodology section will be concluded with the statement of ethical considerations and limitations of the study.

Recap

The current academic literature on intrapreneurship lacks the ability to explain the effect of environmental configurations on the individual innovativeness of an intrapreneur. Rather, it focuses primarily on the emergence of intrapreneurship within the boundaries of the organization as well as the success rate of intrapreneurial endeavors. While many managers recognize the importance of including intrapreneurs within their organization, they lack the specific knowledge on the effect of environmental factors on individual intrapreneurial innovativeness. This knowledge gap could lead managers to hire intrapreneurs on the basis of them being intrapreneur, without the appropriate environmental configuration to support intrapreneurship as effectively and efficiently as possible. That is, the success of the intrapreneur and the success of the organization are inter-reliant. It is, thus, of paramount importance for both actors that the organization is capable of properly supporting intrapreneurship. Conclusively, the research question of this paper is the following:

To what degree is the innovativeness of an intrapreneur in the FMCG industry influenced by capital allocation strictness, funding availability and encouragement for calculated risk?

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The Research Process

For my research I adopted the research process as proposed by BCPS in which I start my research from a research idea. This idea was refined upon discussions with Rein Denekamp, my thesis supervisor. Following this, all relevant literature on the topic of interest was reviewed, based on which a theoretical formulation of the research problem was formulated. Accordingly, empirical research questions were developed that could be tested, thus perfecting the operationalization of the relevant variables. Evidently, this thesis project required a clear planning due to limited time, so a research planning and design was created based on which I continued data collection and analysis. Finally, the results of the data analysis were interpreted both academically as well as practically and compared with earlier research. Optimally, future researchers should be able to continue additional research where this rearch left off.

Methodology & Design

Methodology and design used for this research are based on the quantitative design method. Quantitative research was in this case the most appropriate method, since the topic of intrapreneurship and innovation is growing out of nascence and because I aimed to understand a relationship between multiple known variables rather than aiming to explain a certain phenomenon as it is. Mostly, data was acquired using surveys as this allowed me to explain features of the large group that I aimed to study. Moreover, a survey allowed me to make generalizing remarks on the population, it is usually a reliable and versatile method, and it is cost and time effective. The weaknesses of a survey are inflexibility and issues with validity, however the impact of inflexibility is limited as the boundaries of this research are well-established.

Population Sample

The population of this research was drawn from the actual population. The actual population consisted of all the intrapreneurs within large organizations that operate in the FMCG industry in the Netherlands. Large organizations that operate in the FMCG industry produce multiple consumer goods that spend a, relatively, short time on product shelves. Examples of respondents that were of interest for this particular research were intrapreneurs that worked at Unilever, Procter & Gamble, FrieslandCampina, Nestlé, Pepsico, AB InBev, etc.; all considering that they operate in the Netherlands. These organizations were interesting for this

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research due to their high need to innovate in order to remain competitive within the industry and the, often, problematic innovation efforts (InsideFMCG, 2018; Zairi, 1995).

Evidently, the external validity of the results of this research were not excellent as the scope of the population sample was very specific. This means that the results of this research were not inherently generalizable to other industries. Still, this specificity most likely decreased the influence of confounding variables on the relationship between the independent and dependent variables. That is to say, the amount of variables that may have not been accounted for was limited due to the narrowly defined sample population.

The general aim was, of course, to draw a random sample from the defined population. However, limited time and resources has forced me to adopt a combination between probability sampling as well as non-probability sampling. The simple fact that I, indirectly, had access to a large network within the FMCG industry allowed me to use convenience sampling as an alternative method to the – more preferable – probability sampling, as proposed by most academics.

Additionally, since the actual population was rather difficult to assess (and access) I aimed for a minimum of 40 respondents. I sent out 81 surveys and I received the survey data of 55 respondents. Unfortunately, 3 respondents did not meet the criteria that I have set for this research, so their entries had to be excluded from the dataset. This added up to an effective response rate of 64.2% over a period of 6 weeks. Evidently, this amount of respondents was far from conclusive, but it provided enough information to make assumptions and formulate possible statistical conclusions. All but the three excluded respondents took part in innovation and intrapreneurial endeavors within the company that they were employed by.

Data Collection & Data Analysis

In order to collect data I employed the system Google Forms. This system allowed me to create a quality survey that instantly configures data into a clear overview. Moreover, Google Forms allows surveys to be distributed and shared very easily among peers. The survey was distributed through my personal network, both directly as well as indirectly. Ultimately, Google Forms gave basic insights into the relationships that I wanted to test. However, these insights were far from conclusive so they had to be analyzed with SPSS afterwards. Records of the survey submissions were stored on a physical hard drive (and were copied onto a second hard drive) and were removed from Google Forms’ server as to ensure confidentiality

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should they contain any sensitive information. However, in order to safeguard respondent’s confidentiality the respondents were not asked for their identity.

The data that was acquired through the Google Forms system was analyzed with SPSS. Each submission was reviewed and checked for inconsistencies and errors, as to ensure that the dataset was flawless. The main tests that were executed with SPSS were reliability analyses and regression analyses. These tests gave a clear insight into the data that has been collected through Google Forms and provided assistance in formulating answers to the research question and sub-questions.

Operationalization of Variables

The dependent variable of this research, innovativeness, was measured based on four questions within the survey. Firstly, the innovativeness was measures based on the amount of ideas that the respondent had discussed with colleagues in the previous two years. Secondly, it was measured based on the amount of ideas that the respondent had pitched to superiors in the previous two years. And finally, the innovativeness was measured based on the amount of ideas that the respondent had pitched and were accepted to be developed in the previous two years.

Capital allocation strictness was measured based on two items. Firstly, it was measured based on the degree to which the respondent feels that the company is strict or flexible when allocating capital towards new ideas. Secondly, it was measured based on whether or not the respondent finds it difficult to receive funding for new ideas.

Funding availability was also measured based on two items. Firstly, it was measured based on the amount of capital that the company allocates towards intrapreneurial endeavors. And secondly, it was measured based on the respondent’s perception whether this amount of capital is enough to develop new ideas.

Lastly, encouragement for calculated risk was measured based on two items as well. Firstly, it was measured based on the degree to which the respondent feels that he or she is encouraged by top management to take risks. And secondly, it was measured based on the degree to which the respondent feels that he or she is encouraged by top management to take calculated risks.

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Ethical Considerations

This research was developed ethically. Sensitive information regarding respondents and companies remained confidential and will not be disclosed in this research. Moreover, respondents were not asked to provide personal information, unless they wanted to give it themselves. The author of this research was committed to ensuring these ethical considerations were complied with.

Limitations of the Study

Limitations of this study stem from the limited external validity as a result of the determined scope of the sample population. Moreover, the sampling strategy was a combination of probability as well as non-probability sampling. Clearly, data collection with full probability sampling would generate better results, but this was unachievable due to limited time and resources. This, again, limits the external validity of this research. Moreover, the dependent variable is researched from multiple angles, but all derive from the intrapreneurs’ personal perception on their individual innovativeness; however, where one person might consider two innovations ‘many’, another person might consider it ‘very few’. In the end, innovativeness is a measure that is not easily operationalized. I argue that future researchers would do good to measure intrapreneurial innovativeness based on quantifiable measures (e.g. amount of patents, amount of new ideas generated, amount of new ideas pitched). This would diminish discrepancies in personal perceptions.

RESULTS

To start off the data analysis for this research I ran an internal consistency test through SPSS in order to determine whether it was justifiable to interpret scores that have been aggregated together within my dataset. Indeed, several of the variables of interest were measured using multiple questions and variables in the survey, so it was important to check the Cronbach’s Alpha’s of all these variables. In the table below is shown that all the variables are internally valid, with Cronbach’s Alpha’s higher than the assumed critical value of .7. Thus, based on Cronbach’s Alpha, no variables had to be excluded from further data analysis.

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Exhibit 3. Cronbach’s Alpha’s

However, since the dependent variable was measured solely on the basis of the construct of organization-level characteristics, I expected a factor analysis to output a non-rotatable solution; it turned out that this was, indeed, the case as only one component was output. Moreover, upon bivariate correlation analysis within overarching variables it appeared that several items were too highly correlated. This forced me to remove three items as a result of redundancy. After removing the redundant items, the problem of multicollinearity within my dataset was solved.

Since the dependent variable of interest for this research, innovativeness, was measured in multiple ways throughout the survey (ideas discussed, ideas pitched and ideas accepted), every hypothesis was measured on these three individual dependent variables. Three regression models were created in order to explain the significance of the results based on three measures of innovativeness. For every model a moderator analysis was executed and showed no significant interaction effects between the given items.

Number of New Ideas Discussed

The multiple regression model that was created to test for the three hypotheses as posed in this research based on number of ideas discussed as a measure for innovativeness showed that Pearson Correlations (Appendix) between the independent variables and number of ideas discussed were significant. Moreover, with an Adjusted R Square of .349, it can be assumed that approximately 34.9% of the variance in results can be explained by the given model. Additionally, the model proves to be highly significant with a Sig < .000. However, in the end, the coefficients and their respective significance are the most interesting for this research as they allow us to accept or reject the hypotheses as given.

Cronbach’s Alpha’s

Variable # of items Cronbach’s alpha

Innovativeness 3 .877

Capital allocation strictness 3 .816 Funding availability 3 .921 Encouragement for calculated risk 3 .889

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27 Coefficientsa Model Unstandardized Coefficients Standardized Coefficients t Sig. B Std. Error Beta 1 (Constant) 3,134 1,006 3,114 ,003 Company_StrictnessAlloca tion -,250 ,130 -,319 -1,925 ,060 Company_FundingAvailab ility ,348 ,153 ,343 2,270 ,028 Company_Encouragement ForCalculatedRisk ,035 ,144 ,037 ,240 ,812

a. Dependent Variable: Ideas_Discussed

With a Beta coefficient of -.250, the relationship between capital allocation strictness (H1) and innovativeness (number of ideas discussed) is a negative relationship as suspected. However, given that p = .060 > p = .05, H0 cannot be rejected based on an alpha of .05. This means that it cannot be assumed that capital allocation strictness of a company that an intrapreneur is employed by has a direct negative influence on the number of ideas that an intrapreneur discusses with colleagues. Still, due to the fact that the significance lays a mere .010 above the critical value, it is warranted to further study this particular effect in future research.

With a Beta coefficient of .348, the relationship between funding availability (H2) and innovativeness (number of ideas discussed) is a positive relationship as suspected. Given that p = .028 < p = .05, H0 can be rejected based on an alpha of .05. This implies that it can be assumed that funding availability has a significant positive influence on the number of ideas that an intrapreneur discusses with colleagues.

With a Beta coefficient of .035, the relationship between encouragement for calculated risk (H3) and innovativeness (number of ideas discussed) is a positive relationship as suspected. However, given that p = .812 > p = .05, H0 cannot be rejected based on an alpha of .05. This means that it cannot be assumed that freedom for calculated risk has a direct positive influence on the number of ideas that an intrapreneur discusses with colleagues.

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Number of New Ideas Pitched

The model where number of ideas pitched is assumed as proxy for innovativeness is highly significant with a Sig < .000 and an Adjusted R Square of .520. Within this model all three independent variables are once again used as predictors of change in the dependent variable (ideas pitched).

Similar to the previous paragraph, individual Pearson Correlations between the independent variables and the dependent variable are all highly significant p < .000. However, by looking at the coefficients table of the multiple linear regression analysis it becomes clear that these correlations are interdependent so they do not give a clear view on the actual relationships. Coefficientsa Model Unstandardized Coefficients Standardized Coefficients t Sig. B Std. Error Beta 1 (Constant) 1,902 ,989 1,923 ,061 Company_StrictnessAlloca tion -,327 ,128 -,365 -2,562 ,014 Company_FundingAvailab ility ,411 ,151 ,354 2,723 ,009 Company_Encouragement ForCalculatedRisk ,139 ,142 ,130 ,985 ,330

a. Dependent Variable: Ideas_Pitched

The above table displays how freedom for calculated risk once again shows insignificant results in relation to number of ideas pitched by the intrapreneur. Hence, with p = .330 > .05, H0 for H3 cannot be rejected. H1 (capital allocation strictness) does show negative statistically significant results in relation to number of ideas pitched with Beta = -.327 and p = .014 < .05; thus, H0 for H1 can be rejected. And lastly, funding availability (H2) shows positive significant results in relation to number of ideas pitched with Beta = .411 and p = .009 < .05; thus, H0 for H2 can be rejected.

In the end, strictness of capital allocation has a significant negative relationship with the number of ideas that an intrapreneur pitches to superiors, and the amount of capital that the company allocates toward intrapreneurial endeavors has a positive significant relationship with the number of ideas pitched. Encouragement for taking calculated risk can, based on this particular dataset, not be assumed to have a significant relationship with number of ideas pitched to superiors.