Until now, we have focused on entrepreneurial opportunities pursued by individuals or teams of individuals. It is important to note, though, that existing corporations can also identify, evaluate, and exploit opportunities. Corporate entrepreneurship, which is the name of such activities, is the process in which an individual or group of individuals in an existing corporation creates a new organization or instigates renewal or innovation within that corporation.42 Although corporate entrepreneurship often involves establishing new organizations, these new organizations leverage the parent corporation’s assets, market position, or other resources.43 In other words, when corporate entrepreneurship results in new companies, these new companies often continue to work closely with the parent company.

It is important to recognize that corporate entrepreneurship does not necessarily require creating a new organization. Corporate entrepreneurship, for example, also involves creating new products, services, or technologies. At 3M, engineers can spend as much as 15 percent of their time on projects of their own design. The company believes that this flexibility provides the motivation engineers need to innovate successfully, possibly leading to new products or services—or new organizations altogether.44

Corporate entrepreneurship can be classified into four general types.45 First, sustained regeneration occurs when firms develop new cultures, processes, or structures to support new product innovations in current markets as well as introduce existing products into new markets. Sustained regeneration is the most frequently used type of corporate entrepreneurship.

Second, organizational rejuvenation involves improving a firm’s ability to execute strategies and focuses on new processes instead of new products. GE, for instance, successfully rejuvenated itself by changing policies and procedures within the company to support innovation.

Third, strategic renewal occurs when a firm attempts to alter its own competitive strategy. Unlike introducing a new product or service, strategic renewal occurs when the firm tries to offer a brand-new competitive strategy. Of course, it remains quite difficult for a firm to change strategies. Wal-Mart, for example, is facing tremendous difficulties in trying to alter its strategy to focus on more affluent customers.46

Fourth, domain definition occurs when a firm proactively seeks to create a product market position that competitors have not recognized. When pursuing domain definition, firms hope to become the first entrant in a market segment. In such situations, firms will enjoy the benefits of having no competitors. Amazon.com, for example, was one of the first companies to realize the potential of selling books online. It is important to note, though, that first movers do not always succeed. Apple’s Newton, for example, was the first personal digital assistant (PDA), but this product no longer exists. Moreover, Apple’s iPod was not the first digital music player on the market, but today, the iPod dominates the marketplace.

In sum, there are several general types of corporate entrepreneurship. Despite its importance, not every organization can support corporate entrepreneurship. The success of corporate entrepreneurship efforts will depend on many factors, including an organization’s culture, practices, and even tolerance level for uncertainty.47