Financial Times

Intrapreneurship can unlock shareholder value
When Jack Welch became the Chairman of GE it was a large corporation. In fact the question was what more could one do with such a large corporation. Welch made GE more focused and more results oriented and in the process unleashed more shareholder value. During his tenure shareholder value increased by over $400 billion. No leader can boast of a similar fete in Corporate America or else where.

Sri Lanka too has seen its share of corporate leaders. Even though most tend to manage their business empires in a slow paced lethargic manner there are others such as Ranjith Fernando (NDB) or Ken Balendra (JKH) who have driven dramatic transformations into their organisations and in the process increased shareholder as well as stakeholder value. In fact the need of the hour in most Sri Lankan organisation is intrapreneurship and leadership.

Intrapreneurship
In order to understand intrapreneurship it is important to understand the meaning of entrepreneurship. An entrepreneur is some one who starts a business of his own and through creative acts creates significant shareholders value. Individuals such as Hettigoda of Siddhalepa would tend to fall into this category.

Intrapreneurs on the other hand are those who carry out significant transformations into existing organisations which already possess significant size and scale. They practice entrepreneurship within existing organisations. While Richard Branson of Virgin would fall into the category of an Entrepreneur, Jack Welch could be regarded as an Intrapreneur.

Leadership
There are many views and ideas of leadership. A leader could be someone who has a vision and who guides his followers passionately towards achieving that vision. An essential characteristic of leadership is having committed followers. Therefore all corporate executives would not automatically fall within the remit of leadership since they may have mere employees or assistants rather than followers.

The need of the hour in many large organisations is transformational leadership. This is the ability to carry out significant transformations or leaps forward. NSB achieved significant transformations under its previous Chairman Cyril Herath whereas in recent times SLT had made great strides under the administration of Thilanga Sumathipala.

Leaders with transformational skills can breakaway the bureaucracy and inertia which can set in large organisations, lead to superior performance and unleash shareholder value.

The message for the small investor
As small investors one of the concerns that individuals should have would be who is managing their money. Do look into the history and profiles of the CEO as well as the senior management team in order to ensure whether these are individuals who can exercise significant intrapreneurship and leadership skills in order to take your organisation forward. Your investment will grow and returns will be high only if they posses these skills.

Welch had once quoted that his vision was to be Number one or Two in every business GE is in. He worked with a passion to achieve this. If every Sri Lankan corporate leader follows a similar model, value would indeed increase for the shareholder community.

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