PREFACE Several authors state that firms who survive in this throat cutting, competitive and ever dynamic

business environment could take advantage of intrapreneurship to develop competitive edge. The Ethiopian leather sector is one such competitive arena requiring for sustainable competitiveness. Even though the sector possesses comparative advantage, over many of its counterparts, it is tied up with a number of problems. Meanwhile the Government in collaboration with other stakeholders is trying to improve the competitiveness of the industry. But it is believed that such efforts would be undermined, if they are not supported by empirical researches to fill the information gap. To this effect, this study is undertaken with the aim of investigating the factors affecting intrapreneurship and to explore their prevalence in the Addis Ababa leather footwear industry. Based on the literature review, three variables namely; organizational variables, management variables and employee attributes, are identified as factors influential to intraprenurship.To see the prevalence of intrapreneurial behavior, the level of employee satisfaction, effectiveness in organizational activities, customer satisfaction and renewal and innovation are used . Then 4 companies are selected using simple random sampling technique. From the four companies, 166 employees are selected using convenience sampling technique and 14 management level personnel are taken judgmentally as respondents. Questionnaires are administered for both group of respondents and the responses are analyzed using descriptive analysis. The results showed a positive relationship between each one of the influential factors and intrapreneurial behavior. The prevalence of the appropriate organizational, management and employee attributes is low, furthermore the prevalence of intrapreneurial behavior such as effectiveness in organizational activities, employee satisfaction, customer satisfaction and renewal and innovation is low. It is recommended that operators in the industry provide flexible job designs, structures and rules as well as value based and unlimited earning potential for employees. Visionary, risk taking and supportive leaders should be put in place as well.

ii

Table of contents
i ii iii iv v 1 1.1 1.1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 2 2.1 2.2 2.3 2.4 2.5 2.6 2.7 3 Table of Contents List of Tables List of Figures List of Charts List of Acronyms CHAPTER I: INTRODUCTION Background and justification to the research The Ethiopian leather and leather footwear industry Statement of the problem Objectives of the study Limitations Scope of the study Challenges faced Significance of the study Methodology CHAPTER II: REVIEW OF RELATED LITERATURE The concept of intrapreneurship Intrapreneurship as a process Intrapreneurship dimensions Climate for intrapreneurship Barriers to intrapreneurship Research on developing measures to intrapreneurship The conceptual framework for the study CHAPTER III: DATA PRESENTATION AND ANALYSIS i ii iv v vi 1 1 3 5 6 7 8 8 9 9 16 16 18 19 21 22 24 27 32

iii

3.1 3.2 3.3 3.4

Demographic background of the industry and respondents profile The prevalence of factors crucial to intrapreneurial behavior in the industry Measuring the prevalence of intrapreneurial behavior in the industry The relationship between the prerequisites and manifests of intrapreneurship

32 37 48 54

3.5

Relationship of organizational, management and employee attributes with intrapreneurship

61

CHAPTER IV: SUMMARY , CONCLUSIOSN AND RECOMMENDATIONS

65

4.1 4.2 4.3

Summary of findings Conclusion Recommendations Bibliography Appendix I Appendix II

65 67 68 xiv xvii xxvii

iv

List of Tables
Table1: The factors identified as affecting intrapreneurial behavior .. 12 Table 2: The factors identified as manifests of intrapreneurism ..13 Table 3: Factors crucial for intrapreneurial behavior. ..........28 Table4: Manifests of intrapreneurship.................................................................28 Table 5: Leather footwear companies that are members of ELIA. ......................33 Table 6: Profile of respondents included in the analysis...........................................................36 Table 7: Employees evaluation of the organizational culture... ...38 Table8: Employees evaluation of the reward systems..................................................39 Table9: Employees evaluation of the organizational structure.....................................41 Table 10: Employees evaluation of the prevalence of intrapreneurial leadership....................................42 Table 11: Employees evaluation of the level of commitment .........................................43 Table 12: Employees evaluation of the level of management support.....44 Table13: Employees evaluation of the awareness to innovation..................................................45 Table 14: Employees evaluation of the skills and abilities present..46 Table15: Management body evaluation of the level of renewal and innovation......................................49 Table16: Employee evaluation of the level of job satisfaction.........................................50 Table 17: Management body evaluation of the level of effectiveness of organizational activities..51 Table 18: Management body evaluation of the level of customer satisfaction.............................................53 Table19: Correlation of the factors affecting intrapreneurship with the manifests of intrapreneurship...54 Table20: Correlation of organizational culture with the manifests of intrapreneurship...........................55 Table 21: Correlation of reward systems with the manifests of intrapreneurship....56 Table22: Correlation of organizational structure with the manifests of intrapreneurship............................57 Table23: Correlation of leadership with the manifests of intrapreneurship.58 Table 24: Correlation of management commitment with the manifests of intrapreneurship...59 Table25: Correlation of management support with the manifests of intrapreneurship.....59 Table26:Correlation of employee awareness to innovation with the manifests of intrapreneurship............60 Table27:Correlation of employee skills and abilities with the manifests of intrapreneurship.....61 Table28: Correlation of organizational , management and employee variables with intrapreneurship ......62

List of Figures

Figure 1: Tushman and Nadler (1997), congruence model ..............................................30 Figure 2: Adaptation of Tushman and Nadlers congruence model..................................31 Figure 3: The model of intrapreneurship developed for this study...35

vi

List of Charts

Chart 1: Location distribution of ELIA member leather footwear companies.34. Chart 2: Distribution of sample respondents 35 Chart 3: Overall average mean scores of the factors affecting intrapreneurship...47 Chart 4: Overall average mean scores of the manifests of intrapreneurship.5

vii

LIST OF ACRONYMS ECBP: Engineering Capacity Building Program. ELIA: Ethiopian Leather Industries Association. FDDI: Footwear Design Development Institute. GDP: Gross Domestic Product. GTZ: German Technical Cooperation IKED: International Organization for Knowledge Transfer and Enterprise Development. LLPTI: Ethiopian Leather and Leather Products Training Institute. MBA: Master of Business Administration. MoTI: Ministry of Trade and Industry SPSS: Statistical Package for Social Sciences. UNIDO: United Nations Industrial Development Organization.

CHAPTER I: INTRODUCTION
1.1. Background and Justification to the Research The increasingly globalizing market is creating tremendous and significant changes for organizations and industries throughout the world, forcing them to carefully examine their direction and to design strategies to satisfy their multiple stakeholders. Orchestrating the change required to cop-up with the demanding external pressures justifiably is the sole responsibility of management. The task of management is to be aware of the changing scenario. This awareness will allow managers to predict the problems and prepare strategies before a crisis arise. The changes are because of a variety of pressing problems, like: Increased global competition. Continued downsizing and dramatic changes in the marketing place leading to fragmented markets. Dramatic changes in the market place leading to fragmented markets. Fast changing and less predictable economic environment and therefore, diminishing opportunity streams, Increased resource specialization and nearly unpredictable resource needs.

Thus, given the complex, discontinuous, hyper competitive, fast changing world around, it is imperative for companies to take risks, and adopt innovative, creative approaches. Heraclites stated in 500 BC nothing endures but change. The pronouncement here is that companies need to evolve to thrive and respond proactively to the numerous external demanding pressures. These external pressures and turbulence are forcing a fundamental internal transformation which can serve as comprehensive solution for coping up with this dynamism where intrapreneurship is one such internal transformation. The need for intrapreneuriship is a key factor in any companys survival (Anu L.2003). Many large organizations, such as General Motors IBM, General Mills, AT&T, Apple Toyota and the like have benefited. Intrapreneurial activity within an organization can foster a culture of motivation and empowerment amongst employees, ultimately resulting in increased revenue.

According to Hisrich, Peters and Shephered (2005), intrapreneurship can bridge the gap between science and the marketplace. Existing businesses have the financial resources, business skills and frequently the marketing and distribution systems to commercialize innovation successfully. Yet too often the bureaucratic structure, the emphasis on short-term profits, and a highly structured organization inhibit creativity and prevent new products and businesses from being developed (Hisrich, Peters and Shephered 2005:17). Hisrich et.al (2005), further note that, corporations recognizing these inhibiting factors and the need for creativity and innovation have attempted to establish an intrapreneurial spirit in their organizations. The performance and success of a company is increasingly a function of its ability to change, respond to a rapidly changing set of challenges and environments, and through this be responsive to the need of the multitude of stakeholders. The need to understand intrapreneurship emerges here then; which calls for developing a learning organization. In order to create a learning organization, management should foster intrapreneurial culture in the company and make use of employees innovative ability. L2S Incorportaed (2000) identified intrapreneurial employees as being typically energetic and enthusiastic, imaginative and inventive, capable of generating ideas for new products and services. If encouraged and provided with the necessary resources and manpower, such employees will add to the growth of the organization. If not, they may leave or set up on their own-taking valuable customers and business with them. This could have a disastrous effect on the growth of the organization. Consequently intrapreneurial environments promote expansion and growth. In the private sector, the rapid development of technology in recent years, especially information technology, has provided opportunities for firms to launch new products, processes and business in new ways. Competitive advantage has been a driver for both innovation and enterprise (Borins, 2002), and rivalry in the competitive arena has become so intense, with innovate or die being a typical viewpoint. Reviewing the literature of entrepreneurship within organization also shows that a group of authors highlighted the importance of organizational factors for the pursuit of intrapreneurship (Antoncic & Hisrich, 2001; Slevin & Covin, 1989). Based on previous researches, variables such as management support and behavior (e.g. vision, commitment, support and style) organization culture,

structure and mode of action can affect intrapreneurship (Slevin,Covin 1989, Zahra 1991, Antoncic ,Hisrich 2001). Inflexible reward systems, lack of entrepreneurial awareness and skill as well as low motivation from the side of employees are also inhibiting factors to intrapreneurship. Limited amount of research in the sector with regards to intrepreneurship has exacerbated the problem of limited amount of intrapreneurism. Therefore it is very important to investigate as to what factors affect and in what way; intrapreneurship. And it is very important to find ways as to how managers could prepare necessary conditions for developing Intrapreneurship in their companies.

The Ethiopian Leather and leather footwear Industry Ethiopias footwear industry and its leather sector in general enjoy significant international comparative advantage owing to its abundant and available raw materials, highly disciplined workforce and cheap prices. Ethiopia boasts the largest livestock production in Africa, and the 10th largest in the world. Ethiopia annually produces 2.7 million hides, 8.1 million sheepskins and 7.5 million goatskins. This comparative advantage is further underlined by the fact that the costs of raw hides and skins constitute on average 55-60% of the production of semi processed leather. Particularly Ethiopia is one of the major players in the African leather sector. The industry developed rapidly over the past 5 years exporting now finished leather, footwear and leather goods to the EU and international markets. Already now, leather products account for about 10 percent of Ethiopias export earnings, the leather industry is third after coffee and oil seeds. But in terms of manufactured products, the leather sector ranks first. This is very important, because manufacturing products means adding value to them, and this generates more income to the country and the people. Exports of semi-processed leather as well as finished leather products, such as shoes and bags, have grown steadily, reaching an annual average of US$ 83 million in the period 2004/5 to 2007/8 Engineering Capacity Building Program(ECBP ),(2009). Today the sector consists of 800 registered hides/skins traders and about 6,000 tanneries and leather goods factories (World Bank Group 2006). Until recently, foreign investment in leather tanning was not allowed, and only in the last two or three years has foreign investment in tanneries and footwear production got underway.

In fiscal year 2004/2005, regular exports of leather footwear started with small batches delivered to Italy. Three years later, exports of footwear had increased to US$ 10 million. Nine large mechanized enterprises dominated the footwear industry in 2009, most of them exporters. In the same year, the first major international investor, a German company, began work on a factory in Ethiopia. In addition, 30 medium-sized and about 600-700 small and micro enterprises are engaged in the production of footwear (ECBP 2009). A bulletin of members profile of Ethiopian leather industries association indicates that there are 13 footwear companies as members which are located in Addis Ababa. Information from the association also shows that there is one company located in Tigray. Of the 14 members one is a cooperative cluster. However, the industry faces serious problems, both in the processing stages and upstream in the production of raw materials. The problems start out with the low quality of hides and skins. Most cattle are not treated against ecto-parasites and diseases, and this leads to quality degradation of the hides. The common practices of branding, backyard slaughtering, as well as inappropriate storage and transport of hides and skins further reduce their quality (ECBP 2009). Tanneries cause considerable environmental damage and are currently unable to comply with international environmental standards. Manufacturers of finished leather products are considerably less productive than international competitors. Diseconomies of scale and shipping costs add to their competitive disadvantage. As the industry has until recently not been exposed to international markets and has not built up design capabilities, producers have little understanding of fashion trends in international lead markets. According to Engineering capacity building program (ECBP), release (2009), the current limitation of technical and technological competence especially in the Footwear & Leather Product sector is being realized as the major challenge towards meeting the export target set by the Government of Ethiopia. The Ethiopian industry faces constraints due to outmoded equipment and machinery; lack of market information; low quality standards; and limited supply of raw materials (ECBP, 2009). Lack of market awareness and quality standards are also impediments to increasing exports. A delegation from Foot wear Design Development Institute (FDDI) to major shoe factories in Addis Ababa observed the 'Critical Gap Areas' at Firm Level such as Lack of Skill and Knowledge, Lack of Systems & Control, lack of competency in Design, product development and innovations (FDDI, 2009).

In spite of the fact that the combined efforts of THE Ministry of Trade and Industry (MoTI) and FDDI as well as other partner organizations would bear remarkable fruits in terms of increasing the competitiveness of the Ethiopian leather footwear industry both in the domestic and foreign markets, they have disregarded the role of intrapreneurship in increasing the competitiveness of the industry. While they have identified, certain critical firm level gaps such as; Lack of Skill and Knowledge, Lack of Systems & Control, lack of competency in Design, product development and innovations, they proposed external intervention for these gaps. Suburb to the external intervention, the researcher believes that internal transformation would help boost the sector by tracking and solving firm level gaps. Entrepreneurship in essence enables individuals establish new firms and intraprenuership continues the life journey of them. The developed world has achieved remarkable and imaginary business success partly due to its devotion and attention to intrapreneurial scheme. Short life cycles of new products, new work methods, continuum range of breakthrough technology advancements, innovative forms of competition, and many of organizational development success records can be accounted to intrapreueurial spirit. This research therefore is justified as a tool to examine variables that would potentially contribute to the flourishing of the concept, to track firm level gaps and to see as to what can and should be done in terms of intrapreneurship in the leather footwear industry in ADDIS ABABA. 1.2. Statement of The Problem The leather and leather products industry has been defined as a priority sector in Ethiopias PASDEP and the Industrial Development Strategy. The government has worked out a specific five-year development programme for the industry (20062010). The Ethiopian leather and leather products training institute (LLPTI), Engineering Capacity Building Program (ECBP), Ethiopian Leather industries Association (ELIA) in collaboration with international organizations such as GTZ and UNIDO are all working hard to foster the industry in terms of value added competitiveness. On the flip side of the coin, several studies show that the industry is highly constrained by lack of innovation and technology utilization among other numerous problems. The WEF rankings suggest that Ethiopias low competitiveness is due not only to unfavorable broader framework conditions - at least in consideration of its very low income levels, Ethiopia

appears to have made important strides in improving its investment climate. Rather, limitations in the broad investment climate appear to be compounded by specific weaknesses related to the innovation and technology system (IKED, 2006). A study undertaken on the leather and leather footwear industry states that the African footwear sub-sector seems isolated from the fast pace of technological Innovation taking place globally; where the Ethiopian case is not an exception. Lack of design capabilities, of operator, supervisory and manager skills, and of knowledge of more appropriate material inputs and marketing techniques, all combine to cause poor productivity and a low level of competitiveness. Even in the local market, high operation costs and a lack of attention to what the market demands in shoes in terms of quality and price, allow cheap Asian products and second hand shoes to penetrate the market. A study undertaken on Ethiopias innovation status indicates that the country is among the lowest ranking in terms of innovation and technology utilization (IKED, 2006); where the leather footwear sector is not an exception. Surveys of the private sector indicate that the perception in the Ethiopian business community is that there is very little spending on research and development taking place. Other more traditional indicators like patents and scientific articles similarly indicate very little effectiveness of Ethiopias innovation system. Unsurprisingly, Ethiopias exports have no high-technology content. The same study indicates that lack of data for benchmarking the innovation system is a serious problem in the case of Ethiopia. This fact has everything to do with the leather footwear industry. This study tries to analyze therefore, the factors affecting intrapreneurship and investigate their prevalence in the Addis Ababa leather footwear industry. Specifically, the study attempts to address the following questions: Is there any relationship between organizational variables such as organizational culture, reward system, and organizational structure and intrapreneurship? Is there any relationship between management attributes namely: leadership, management commitment as well as management support and intrapreneurship? Is there any relationship between employee attributes namely: employee awareness to innovation as well as skills and abilities and intrapreneurship? Do the study organizations possess the appropriate culture, organizational structure and reward systems to support intrapreneurship?

Do the study organizations demonstrate the appropriate level of intrapreneurial leadership, management commitment and support to support intrapreneurship? Is there an appropriate level of employee awareness to innovation and skills & abilities to support intrapreneurship? Is there an intrapreneurial behavior in the study organizations?

1.3. Objectives of the Research The major objective of this study is to investigate whether organizational attributes (structure, culture and reward systems), management attributes (leadership, commitment and support) as well as employee attributes (awareness to and possession of entrepreneurial skill and ability), influence intrapreneurship, and to investigate the prevalence of these attributes in the Addis Ababa leather footwear industry, as a manifest of intrapereneurism. Specific objectives 1. To investigate whether or not: Organizational structure influence intrapreneurship. Organizational culture influence intrapreneurship. Reward systems influence intrapreneurship. Leadership, management commitment as well as support influence

intrapreneurship. Employee awareness to and possession of entrepreneurial skills and abilities influence intrapreneurship. 2. To investigate whether or not: Organizational culture, structure and reward systems are properly in place to support intrapreneurism. Leadership commitment and support of management are in place to support intrapreneurship in the industry. There exist awareness to and possession of entrepreneurial skills and abilities by employees in the industry.

1.4. Scope of the Research This study focuses on analyzing the factors affecting intrapreneurship and to see the prevalence of these factors in the industry. Environmental factors which may affect the level of intrapreneurial behavior are excluded from this study. The study covers selected leather footwear companies in ADDIS ABABA which may limit the scope of generalization of the findings. And the generalizations are limited to the member companies of the Ethiopian Leather Industries Association and it is limited to the identified variables in the study to measuring the level of intrapreneurship in the industry. It takes data from employees and management. 1.5. Constraints faced The researcher attempted to exert the maximum possible effort to control and reduce the constraints that may hamper the completeness of the study. Meanwhile some constraints have been faced in the course of undertaking the study. Some of them are identified below: Financial constraints ; the researcher is a self sponsored student in the MBA program and is responsible to all costs of the programe, including tuition fee as well as advisory payment to advisors. Furthermore the researcher did not secure fund to cover the costs that take to accomplish this study. Thus it has taken a backbreaking debt in an attempt to cover the expenses. This is because the school does not provide research fund for self-sponsored students; which the researcher feels is unfair and unprofessional. Time constraints; investigating intrapreneurship is a time taking study, which may require several months to gather data appropriately and analyze that thereto carefully and accurately. The time provided for this project however, is only one semester which required a breath taking enthusiasm and complacency to complete the study. Bureaucratic constraints; most companies and institutions in our country Ethiopia are not quite pragmatic and open in providing information regarding their company. Because of this the data gathering task was very challenging.

1.6 Significance of the Research Though the primary purpose this study intended to was fulfillment of a Master of Business Administration Degree; it uncovers the under researched topic in this country of ours. Intrapreneurship is important for organizational survive, growth, profitability, and renewal (Zahra 1995, 1996), especially in larger organizations. As the case is true for entrepreneurship, intrapreneurism is very much limited in this country of ours. But as the time is demanding today, because of intensive domestic and global competition, understanding its importance and creating it is a must. On the contrary however limited research has been undertaken in the area. Because intrapreneurship is a relatively new concept, only a small amount of research has been conducted in this area, particularly in the area of measuring intrapreneurship in organizations. Most of the research that has been conducted in this area has focused primarily on entrepreneurship and small business development. According to Elizabeth Hill (2003), it has been implied that because intrapreneurship is a quality that can vary in degree and intensity, intrapreneurial intensity can therefore be measured. And organizations need to find ways to measure and reward intrapreneurship, both in terms of its frequency and the rigor with which it is pursued. To this effect, this study has numerous benefits to multiple stakeholders. For research centers the study will serve as a stepping stone to undertaking further research to developing a more comprehensive model of intrapreneurship to serve in this country of ours. A countries development is a function of individual and company level output; the more individual and company level efforts are utilized effectively and efficiently, the higher will a countries ability is to allocate resources optimally. Thus this study has implication for policy makers as well. To help countries GDP grow appropriately, policy makers can use the advantage of such studies as input to prescribe individual companies for preparing strategies as to how to utilize employees and management ability optimally. To the industry in the research, the study will serve as an input to investigating their respective positions as far as intraprenuership is concerned. To other companies, it will serve as a benchmark to assessing their intrapreneurial environment and act accordingly.

1.7. Methodology of the Research A scientific methodology is a system of explicit rules and procedures upon which research is based and against which claims for knowledge are evaluated (Nachmias & Nachmias 1996). Hence this section presents the procedures intended to be followed in designing the research, determining unit of analysis, gathering data, analyzing and presenting data. 1.7.1 Research Design Nachmias & Nachmias (1996), state a research design as the program that guides the investigator as she or he collects analyses and interprets observations. It is a logical model of proof that allows the researcher to draw inferences concerning causal relations among the variables under investigation.
The research design also defines the domain of generalizability, that is, whether the obtained interpretations can be generalized to a larger population or to different situations (Nachmias & Nachmias 1996). This study is undertaken with the aim of investigating the factors affecting

intrapreneurship and to explore their prevalence in the Addis Ababa leather footwear industry. Based on the literature review, three variables namely; organizational variables, management variables and employee attributes, are identified as factors influential to intraprenurship.To see the prevalence of intrapreneurial behavior, the level of employee satisfaction, effectiveness in organizational activities, customer satisfaction and renewal and innovation are used The study is cross-sectional descriptive research. Nachmias & Nachmias (1996), state that the cross-sectional design is perhaps the most predominant design employed in social sciences. This design is often identified with survey research. Thus this study is categorized under the cross-sectional survey research and it is predominantly a quantitative research. 1.7.2 Unit of Analysis and Population In this study, the population is the leather footwear industry in Addis Ababa. There are about 11 manufacturing level leather footwear companies in Addis Ababa who are members of ELIA. From them, representative sample of companies are taken from the industry to enable the researcher generalize for the industry. In the selected companies, there are about 1400

10

employees and 78 management personnel, which are considered to be the population of the study. 1.7.3 Sampling Design The researcher employees a multi stage sampling technique in this study. First using simple random sampling technique, 4 companies are selected. Then based on the proportion of employees and management personnel each company has, compared to the total employees in the selected companies, employees to be included in the sample are selected using simple random sampling technique. Management personnel from each sample company are selected based on judgmental sampling technique. Accordingly from the 1400 employees 180 are selected from the four companies. The numbers of employees to be taken from each company are determined based on the number of employees each company possesses in proportion to the total population of the four companies. The number of management respondents is equally distributed to each company. Thus four management level respondents are taken from each company. 1.7.4 Data Gathering Instrument The study applies a slightly adopted model based on the works of Kuratko, Montagno and Hornsby (1990); Elizabeth Hill (2003); Ahmad et.al (date not stated); as well as Jarna and Kaisu (date not stated). The model is utilized to measure the level of intrapreneurship in the selected industry. The model involves a two step study, whereby first the relationship between the independent variables and the dependent variables are explored and then the prevalence of the variables in the study industry is investigated. Under each of the independent, and dependent variables, there are several items as measures of each variable identified. To this effect questionnaire are selected as an appropriate data gathering tool. Using the Likerts scale, a five scale category responses are developed to provide manageable and controllable options for respondents. Accrding to Nachmias & Nachmias (1996), the rating scale is one of the most common formats for questions asked in social science surveys. Rating scales are used when it is intended to ask respondents to make a judgment in terms of sets of ordered categories, such as strongly agree favorable or very often etc... The response categories of such questions are termed as quantifiers; they reflect the intensity of the particular judgment

11

involved (Nachmias & Nachmias 1996). Thus in this study a 5 scale category i.e 1=very low, 2=low, 3=moderate, 4= high and 5=very high are used to responses. Data gathering procedure To administer the questionnaire, the researchr first selected four third year management students and one staff who holds diploma from Admas University college and gave them a half day training on the general concepts of entrepreneurship and intrapreneurship. Then before the actual data collection process these data collectors are provided with general orientation regarding the contents of the questionnaire and go through all the contents one by one to create clear understanding. To test the established caliber of the data collectors, a sample of 10 employees are taken from Admas University College and the data collectors are allowed to demonstrate their skill in the process. Then based on the feedback collected from the sample respondents, some improvements are suggested for the proposed data collectors.The actual data collection process then is undertaken by the trained and oriented data collectors. 1.7.5 The Measuring Instrument Literatures revised as presented in the second chapter, provide some important issues relating to intrapreneurship. These issues include innovation and intraprenuership, the dimensions of intrapreneurship, an intrapreneurial organizational climate as well as the common barriers to intrapreneurship. Furthermore the various researches undertaken to measuring intrapreneurship are also presented. Based on these conceptual frameworks provided thereto, the researcher has designed two-stage analysis. Stage I-Factor Audit This stage aims at examining factors that would affect the intensity and prevalence of intrapreneurial edge of firms. The stage is designed to build exhaustive sets of factors that should be managed to harvest the fruits of intrapreneurship. Furthermore, the factor set would help firms give the appropriate level of emphasis for the factors in the set. The conceptual model applied in this stage constitutes three variables as affecting the level of intrapreneurship namely; Organizational attributes , Management attributes, and Employee attributes; and a dependent variables i.e. employee satisfaction, organizational effectiveness, renewal and innovation and customer satisfaction that are considered to be manifests of intrapreneurism.

12

Table 1: Independent variables construct Variables Organizational attributes Culture Structure Reward systems Measures Evidence of interdependence and team work Level of power distance / authoritarianism Clearness of organisational vision Acceptance of uncertainty Attitude towards failure Awareness of future opportunities Encouragement of life-long learning Recruitment of intrapreneurial employees Encouragement of innovation and creativity and calculated risk taking Policies encouraging creative and innovative approaches Reward systems for intrapreneurial behaviour Level of punishment / reward for taking calculated risks Availability of intra-capital Presence of leadership in organization. Problem solving ability and support. Innovativeness and charisma of leader Leaders knowledge of the environment and competition Encouragement of teamwork Encouragement of open discussion and negotiation Encouragement of intrapreneurial philosophy in organization Intrapreneurial qualities of employees Employee attitudes towards change, risk and failure Willingness of employees to embrace new opportunities Levels of innovative and creative employees Employees ability to deal with uncertainty

Management attributes Leadership Commitment Support

Employee attributes Awareness Skills & abilities

Source: Developed for this research

Stage II-Inrapreneurial Audit Employing the outcomes of stage I, the researcher will construct a measurement package based on which the state of existence of each influencing factor and the manifests of intrapreneurship in the selected organizations can be profiled; thereby an intrapreneurial audit can ultimately be undertaken. The measurement package will be designed in a way that helps firms discover gaps. For the intrapreneurial audit the following manifests of intrapreneurship will be investigated against the influencing factors.

13

Table 2: The dependent variables construct Indicators intrapreneurism Organizational effectiveness Performance of organizational activities without delay. Utilization of existing potential and facilities. Analysis of activities to find out weaknesses. Improvements in methods. Achievement of organizational goals. Employee and machinery productivity. Employee job satisfaction Interest in the job. Own and others Value for the work. Demonstration of employee initiative Happiness in the work Perception of ones role to the work place. Renewal and innovation Emphasis on new and innovative products. Improvement and renewal of missions, goals objectives and strategies Level of new product / service introductions. Improvement or revision of current products / services. Application of New ways of planning Improvement and /or modification in structures and rules. Customer satisfaction Perception of customers to the price quality relations Responsiveness to customers. Familiarity with customers needs Customer relations. Regular Analysis of customers needs. Source: Developed for this research 1.7.6 Data Analysis and Presentation Techniques The statistical package for social science studies (SPSS) is employed to undertake the correlation analysis and factor tests. The analysis is descriptive one supported by texts, tables, charts and figures. In the endeavor of the analysis, first the relationship of the influencing factors with renewal and innovation as well as effectiveness of organizational of Measures

14

activities, employee job satisfaction and customer satisfaction are investigated and using the SPSS these variables are computed combined to investigate the level of intrapreneurship and then the existence of the influencing factors in the study companies is investigated. 1.7.7Testing validity The issue of validity arises because measurement in the social sciences is, with very few exceptions, indirect. Under such circumstances, researchers are never completely certain that they are measuring the precise property that they intend to measure. According to Nachmias and Nachmias (1990), validity is concerned with the question is one measuring what one thinks is measuring? Therefore validity refers to the meaning of the measure, the accuracy with which it can be assessed, and the range of inference that can be made from knowledge of the score. According to Rymarchyk (2002), validity in social science research has several different components. Of the different validity components, in this study the researcher has examined the following: Face validity Face validity requires that your measure appears relevant to your construct to an innocent bystander, or more specifically, to those who you wish to measure (Rymarchyk, 2002, p-2). On top of this concept, the researcher distributed the sample questionnaire to selected regular second year accounting and management students who are not considered to be experts in the area. The researcher attached a cover letter explaining the nature of the research and its objectives. The improvements made based on this process are incorporated in the final version of the questionnaire. Content validity After improving the first draft of the questionnaire based on the suggestions of the participants in the first process, the researcher distributed a copy of the improved questionnaire to business management and marketing management instructors in Admas University college and Adama University who have a good deal of understanding to and have thought the course entrepreneurship. The instructors involved in this process all investigated and returned the questionnaire with very important suggestions. Then the improved version from this process is given to the advisor of the researcher with whom final adjustments are made for the final version.

15

1.7.7. Testing reliability The reliability of the questionnaire for employees is tested using Cronbachess alpha. According to this result the reliability of the questionnaire for employees is estimated to be 0.95. (See table in appendix). To test the reliability of the questionnaire for management personnel, the questionnaire is fed to SPSS and using Cronbachess alpha the reliability thus is estimated as 0.76(see table in appendix B-1), which is more than modest.

16

CHAPTER TWO: REVIEW OF RELATED LITURATURE This chapter reviews the relevant literature written in the area of intrapreneurship and related topics. The first section reviews innovation as it is closely associated with intrapreneurship, and then it explores the relationship of innovation with intrapreneurship; the next section provides an overview of intraprenuership followed by the climate for intrapreneurship and barriers to intrapreneurship respectively. The next section gives a brief review of researches undertaken to developing instruments to measuring intrapreneurship. Finally the conceptual framework developed for this study, to be employed to measuring intrapreneurship is provided. 2.1. The concept of innovation The definition of innovation is: The intentional introduction and application within a role, group or organization of ideas, processes, products or procedures, new to the relevant unit of adoption, designed to significantly benefit the individual, the group, organization or wider society (Cardellino, Finch; 2006: 151). The definition explains the intentional approach that organizations have adopted when creating and evolving new ideas. The concept suggests that an approach to innovation does not exist, but innovations are planned in such a way that they can anticipate the benefits arising from the change. Such benefits are not restricted to economic and productivity benefits but may also include personal growth, increased satisfaction, efficiency, productivity or better personal communication. Peter Drucker is a leading authority on entrepreneurship and innovation Drucker describes innovation as: It is the means by which organizations create value-producing resources or endows existing resources with enhanced potential for creating value and The effort to create purposeful, focused (Drucker,1985.) Drucker outlines seven sources for innovative opportunities that should be monitored by those interested in starting an entrepreneurial venture. The first four are sources of innovation that lie within the industry. The last three arise in the societal environment. These opportunities are : The unexpected, the incongruity, innovation based on process need, changes in industry or market structure, demographics, changes in perception, mood and meaning, new knowledge (Drucker, 1985). change in an enterprises economic or social potential

17

According to several authors such as Pinchot and Pellman (1999), Robbins (1997) Innovation

involves finding a new and better way of doing something. Much of our modern society is based on innovations that have occurred in the past that provide us with the standard of living we enjoy today. And Innovation has always been at the centerpiece of competitiveness. The new technologies competition, time and speed are used to explain the dynamics of competition. Thus there is a large focus on the concept of innovation in organizations. Innovation takes several forms: in products, services, production processes and management systems. Innovation in products and services is related to Research& Development and meeting consumers needs. Innovation with respect to processes relates to changes in machinery and other elements not directly associated with employees and have the aim of increasing productivity and efficiency. Innovation in management systems is usually in response to new environmental conditions, and improving the way in which people are managed and work is organized. This form of innovation becomes necessary by changes in the process. Business innovation deals with innovation in management thinking and its primary purpose are to create new value and wealth for all stakeholders and thereby increase economic prospects. It is motivated by changes in external and internal environmental conditions, customers, competitors, Suppliers and employees. (Lorente, Dewhurst, Dale; 1999: 12, 13). 2.2. Innovation for Intrapreneurship Intrapreneurship has been conceptualized as the actions of individuals within organizations leading to innovation of product, services or processes. Failing to consider linkages between the phases of team development, service innovation and product innovation has prevented organizations from optimizing the benefits accruing from intrapreneurial activities. Innovation also involves the introduction of new products, services, systems or processes, or the adaptation of existing ones. Innovation requires allocation of resources, long-term planning in the future. This provides insight into what is related in terms of new products, procedures and services. In addition to faith in the future, innovation needs management committed to quality, productivity and effectiveness and the policies, programmes and procedures that make middle management and those they lead, skeptical of the efforts to create greater effectiveness and productivity. At the centre of this approach is the

18

appropriate application of education within an environment that communicates and promotes innovative, thought-aligned actions. Success through a planned and structured approach to innovation can contribute to corporate growth and competitive advantage. A review of three approaches adopted by successful companies suggested that multidisciplinary teams have an important role to play particularly in screening proposals and developing strategy. The innovation process operates as a continuous spiral at the team development, service innovation and product innovation phases. 2.3. Economic Improve Role of Innovation The fast-changing economy and technology influence society, organizations, and managers according to Drucker. In his view the knowledge society will require all members to have basic computer or other skills as well as conventional literacy skills; political, social and historical knowledge as well as the skills of learning-to-learn. Big business, Drucker believes, will be information-based and in general comprise flatter organizations comprising knowledge specialists future's organization will have knowledge located primarily at the bottom of enterprise, in the minds of specialists who do different work and direct themselves. In such an information-based organization, traditional departments will serve several roles: as guardians of standards, as centers for training and the assignment of specialists. When a large business organizes around information, it leads to a reduced number of management levels. In his view there are three reasons why large organizations will have to become information based. First, because knowledge workers, who form a growing part of the workforce, are not responsive to common control methods. Secondly, the organization must decide what information it needs to operate otherwise it will be submerged in data. Thirdly is to ``systematise innovation and entrepreneurship which is quintessential knowledge work''. (Roffe, 1999: 225).

19

2.4. The concept of Intrapreneurship The term intrapreneur was first used by Gifford Pinchot in the late 1980s and refers to individuals who take hands-on responsibility for shaping innovation inside the organization (Saetre; 2001: 10; Manion; 2001: 6). He described intrapreneur as person who focuses on innovation and creativity and who transforms a dream or an idea into a profitable venture, by operating within the organizational environment. (Carland and Carland; 2007:84). The term intrapreneur had been added to The American Heritage Dictionary in 1992. Intrapreneur is defined in it as: A person within a large corporation who takes direct responsibility for turning an idea into a profitable finished product through assertive risktaking and innovation (Hill; 2003: 19). The intrapreneur: is not a blue-sky dreamer or an intellectual giant. He or she may even be a product-service idea thief or may be impatient and egotistical. But most of all, such people get the job done. And when they do, they are fted in style with lights flashing and big rewards. (Burch; 1986:40). Intrapreneurs can be determined as entrepreneurs within established firms, and they almost resemble independent entrepreneurs (Menzel, Aaltio and Ulijn; 2007:734). An intrapreneur changes his/her own environment (Sayeed and Gazdar; 2003: 79). Intrapreneurs turn ideas into realities within an organization (Shetty; 2004:54). The intrapreneur challenges the status quo and struggles to improve the system from within (Shetty; 2004: 54). Intrapreneurs come up with new estimations, take full advantage of opportunities and turn them to beneficial new realities, support change and develop creative reactions in the organization (Menzel Aaltio and Ulijn; 2007:734). An intrapreneur acts in organization as an entrepreneur. The intrapreneurship phenomenon has been explained in various terms such as intrapreneuring; corporate entrepreneurship; internal corporate entrepreneurship; corporate venturing; internal corporate entrepreneurship; strategic renewal; internal entrepreneurship and venturing (Antoncic; 2007; Sharma and Chrisman; 1999: 14). In this study the term intrapreneurship will be used. Drucker stated some decade ago that todays businesses, especially the large ones, simply will not survive in this period of rapid change and innovation unless they acquire entrepreneurial competence. Today -especially- large-size companies are turning to intrapreneurship because they are not getting the continual

innovation, development, and value creation that they previously had (Menzel et al.; 2006: 3). Intrapreneurship is a sub-field of entrepreneurship (Antoncic and Hisrich; 2003: 7) and

20

intrapreneurships broadest definition is entrepreneurship in an existing firm (Antoncic and Hisrich; 2003: 9). In other words intrapreneurship is entrepreneurship practiced by individuals inside founded organizations (Shetty; 2004: 21). Intrapreneurship has been defined in distinct ways; as a process; as doing new things; as spirit of entrepreneurship inside the existing firm; and as creation of new organizations by an organization (Antoncic and Hisrich; 2003: 9). Intrapreneurship is basically an individual action (Gapp and Fisher; 2007; 331). Intrapreneurship is the practice of composing new business products and opportunities in an organization by proactive empowerment (Essley and Longenecker; 2006: 19). The term intrapreneurship refers to a process that goes on within a founded firm, regardless of its size, and leads not only to new business ventures but also to other innovative activities and orientations such as development of new products, services, technologies, managerial techniques, strategies, and competitive postures (Antoncic and Hisrich; 2001: 498). Intrapreneurship is the process of uncovering and developing an opportunity to create value through innovation and seizing that opportunity without regard to either resources or the location of the entrepreneur (Menzel, Aaltio and Ulijn; 2007:734) Intrapreneurship has conceived as the actions of employees within organizations leading to innovation of product, services or processes (Gapp and Fisher; 2007: 330).Some researchers used the term intrapreneurship only for big-size organizations. They are excluding smaller organizations when they defined the term (Antoncic and Hisrich; 2003: 9). However, we can say that intrapreneurship is realizable in small and medium size organizations too. Therefore in this paper, intrapreneurship is described as entrepreneurial activities within an established organization, regardless of its size. 2.5. Intrapreneurship as a Process Intrapreneurship can be considered as a process. Sharma and Chrisman describe intrapreneurship as . . . the process whereby an individual or a group of individuals, in association with an existing organization, create a new organization, or instigate renewal or innovation within that organization (Sharma and Chrisman; 1999:18) Intrapreneurship is a process by which individuals-either on their own or inside organizations-pursue opportunities without regard to the resources they currently control. (Stevenson and Jarillo; 1990: 25). Another description of intrapreneurship is the process of uncovering and

21

developing an opportunity to create value through innovation and seizing that opportunity without regard to either resources or the location of the entrepreneur (Antoncic and Hisrich; 2001:497). Intrapreneurship process can be categorized in three distinctive modes: analytical, intuitive and political. Intrapreneurs in analytical mode focused on implementing solutions and are characterized by analytical thinking. Those operating in this mode wanted to focus on a particular problem that they could command, having the functional proficiency and the authority to apply to it. These intrapreneurs focused their concentration on objective results and on the use of administrative formulas. In addition, they used authority, whether hierarchical or technological, to impact decisions (Janczak and Boiteux; 2007). Intrapreneurs focused their energies on producing new ideas for developing inventive initiatives in the intuitive mode. In this mode they undertake initiatives that not only added value to their organizations, but also gave distinction to them and/or their employees. Generally these intrapreneurs describe their estimations while they process to complete their venture initiatives. Also they make use of emotions to affect decisions (Janczak and Boiteux; 2007). In the third mode, intrapreneurs focused their efforts on the political process of haggling strategies to develop results. In this process, intrapreneurs described a complex network of links that caused them to transform their early goals (Janczak and Boiteux; 2007).We can say that in all of the three modes three stages emerge. These three phases are (i) Opportunity Discovery; (ii) Opportunity Exploitation and (iii) New Means-end Relationship. 2.6. Intrapreneurship Dimensions Previous studies of intrapreneurship can be conceived as constituting four diverse dimensions (Dhaliwal; 2001:426): New business venturing, Innovativeness, Self-renewal, Proactiveness. Antoncic and Hisrich (2003) describe eight intrapreneurship dimensions: (1)newventures; (2) new businesses; (3) product/service innovativeness; (4) processinnovativeness; (5) selfrenewal; (6) risk taking; (7) proactiveness; and (8) competitive aggressiveness.

22

2.6.1. New Ventures and New Businesses New business venturing is the most important dimension of intrapreneurship as it can results in the creation of a new business within an established organization by redefining the firms products/services and/or by entering new markets ( Antoncic and Hisrich;2001: 498). The new ventures dimension refers to creation of new parts or firms, whereas the new business by the founded organization without forming new organizational entities (Antoncic and Hisrich; 2003: 16). 2.6.2. Product/Service and Process Innovativeness and Innovation Intrapreneurship includes new product improvement, and new manufacturing methods and procedures (Antoncic and Hisrich; 2003: 16). New product and/or service improvement can be estimated as a vital factor that differentiates successful from unsuccessful organizations (Auruskeviciene et al.; 2006:341). Schumpeter stressed the role of entrepreneur as an innovator. From a Schumpeterian view an entrepreneur carries out new combinations of resources to create products that didnt exist before (Hall and Sobel; 2006:4). Innovation is an important dimension of intrapreneurship as a result the intrapreneurship is an entrepreneurial action in an existing organization. Extent of innovation refers to the measure of newness of a venture in the market. For the ventures that are totally new to the marketplace, and perhaps even create new markets, the firm in question is the pioneer and faces significantly better challenges as a result (Sharma and Chrisman; 1999: 14). Intrapreneurship is innovative products or processes are developed by creating an entrepreneurial culture within an already existing organization (Fry, 1993: 373; from: Hill; 2003: 19). So innovativeness is one of the main driving forces of the intrapreneurship. 2.6.3. Self-renewal The self-renewal dimension imitates the transformation of organizations through the renewal of basic ideas on which they are built. It has strategic and organizational change nuances and includes the redefinition of the business conception, reorganization, and the introduction of system-wide changes for innovation (Antoncic and Hisrich; 2001: 499). 2.6.4. Proactiveness Proactiveness dimension is concerned with pioneering and it is also associated with market survival positively. Proactiveness indicates a companys determination to follow promising

23

opportunities, rather than only responding to competitors moves (Zahra and Garvis; 2000: 474). Proactiveness concept is: refers to the extent to which organizations attempt to lead rather than follow competitors in such key business areas as the introduction of new products or services, operating technologies, and administrative techniques. (Antoncic and Hisrich; 2003: 18). 2.6.5. Risk-taking Intrapreneurs are risk takers who are willing to commit their time and energy to making a good idea an innovative reality in their organization (Covin and Slevin; 1991: 10). Through this process they add a large repertoire of skills and experiences that helps build a career (Manion; 2001: 10). It is necessary to develop an intrapreneurial environment for risktaking. Risk-taking emerges as a regular factor in that employees and management must have a wish to take a risk and have a tolerance for collapse should it arise (Kuratko et al.; 1990:52). Intrapreneur is somebody who A person within a large corporation who takes direct responsibility for turning an idea into a profitable finished product through assertive risk taking and innovation (Toftoy and Chatterjee; 2004:2). Risk-taking is one of the important elements of intrapreneurship. So by encouraging risk taking and experimentation, a corporation has more chances of creating a successful product (Toftoy and Chatterjee; 2004:8). 2.6.6. Competitive Aggressiveness Competitive aggressiveness refers to the companys tendency to challenge its competitors. Competitive aggressiveness is an administrative tendency expressed in an organizational willingness to take on and dominate competitors. Entrepreneurial condition is fairly reflected in the firms tendency to aggressively compete with industry rivals. (Antoncic and Hisrich; 2003:18). Competitive aggressiveness marks the companys aggressive attack to competitors. 2.7. Climate for Intrapreneurship Hisrich et.al. (2005) state that, in establishing an intrapreneurial environment, certain factors and leadership characteristics need to be operant. First the organization is required to operate in the frontiers of technology. Since research and development are key sources of successful new product ideas , the firm must operate on the cutting edge of the industrys technology , encouraging and supporting new ideas instead of discouraging them, as frequently occurs in

24

the firms that require a rapid return on investment and a high sales volume. Second, experimentation trial and error- is encouraged. Successful new products or services usually do not appear fully developed instead; they evolve (Hisrich et.al. 2005). Third, an

organization should make sure that there are no initial opportunity parameters inhibiting creativity in new product development. Frequently in organizations, various turfs are protected, frustrating attempts by potential intrapreneurs to establish new ventures. Fourth, the resources of the firm need to be available and easily accessible. Fifth, a multidiscipline team approach needs to be encouraged. This open approach, with participation by needed individuals regardless of area, is the antithesis of the typical corporate organizational structure. An evaluation of successful cases of intrapreneurship indicated that one key to success was the existence of skunk works involving relevant people (Hisrich et.al. 2005). Besides encouraging teamwork, the corporate environment must establish a long time horizon for evaluating the success of the overall program as well as the success of each individual ventures. Sixth, the spirit of intrapreneurship cannot be forced upon individuals; it must be on a voluntary basis. Seventh the intrapreneur needs to be appropriately rewarded for all the energy, effort and risk taking expended in the creation of new venture. Rewards should be based on the attainment of established performance goals (Hisrich et.al. 2005). Eighth, a corporate environment favorable for intraprenuership has sponsors and champions throughout the organization who not only support the creative activity but also have the planning flexibility to establish new objectives and directions as needed. Finally , and perhaps the most important , the intrapreneurial activity must be wholeheartedly supported and embraced by top management , both by their physical presence and by making sure that the personnel and the financial resources are available. Without top management support, a successful intrapreneurial environment cannot be created (Hisrich et.al. 2005). Hisrich et.al. (2005) further identified within the overall corporate environment, certain individual characteristics have been identified that constitute a successful intrapreneur. This include ; understanding the environment , being visionary and flexible , creating management options , encouraging team work , encouraging open discussions , building a coalition of supporters and being persistent.

25

Fradette and Michaud (1998) describe four main elements to an organization which succeeds with entrepreneurship. First, the strategic and structural environment is right. The purpose and direction implies a realistic vision and it is widely understood and shared. Secondly, an appropriate workforce has been built. Enterprising people have been recruited. They have been trained in key skills and there is an appropriate reward system. Thirdly, the workforce is backed by the necessary support systems. Team working is common place, people collaborate and network naturally, information is shared and learning is fostered. Fourthly, successes are visibly rewarded and mistakes are not sanctioned so harshly that people are dissuaded from further initiatives.

2.8. Barriers to Intrapreneurship

In a competitive business environment, it is clear that companies need to search for new business notions and opportunities and they make the essential arrangements to bring them to gainful results. However, many organizations face some difficulties in doing this. Barriers of intrapreneurship prevent entrepreneurship within the organization (Kirby; 2006: 601). Some operational difficulties to intrapreneurship have been noted inadequate planning, improbable corporate expectations, insufficient corporate support, and misreading the market, as main obstacles to successful new business development (Kuratko et al.; 1990:50, 51). We can note that organizations need some procedures to direct or redirect resources to establish effective intrapreneurship strategies and survival of intrapreneurship.

Intrapreneurship is stopped and it will disappear with time when mistakes related to new ideas and innovation are made (Eesley and Longenecker; 2006: 19). An organization needs a number of factors to develop an intrapreneurial environment such as management support, motivations, organizational structure, resources and risk taking (Kuratko et al.; 1990:51). Intrapreneurship barriers can be categorized into four main titles. 2.8.1. Resistance to Change Individuals frequently resist change for the reason that they have already invested a great amount of time and force in mastering certain job, and fear that their asset will be wasted. Change is resisted because the future is unfamiliar and collapse could potentially cause risk to personal status and respect. Its meaning that innovation could pressure existing power structures and relations (Hill; 2003:24, 25).

26

2.8.2. The Inherent Nature of Large Organizations In large organizations managers are required to structure in order to be able to control it. In large organizations management is forced to establish stable, quantifiable performance standards, resulting in large quantities of paperwork. The traditional corporate culture has a climate and recompense system (Hill; 2003: 25, 26). Intrapreneurship is prevented when an organization is characterized by poor communication and structural silos by the flow of useful information (Eesley and Longenecker; 2006: 19). In a traditional corporate culture guide principles are to: follow the instructions given; do not make any mistakes; do not fail; do not take the initiative but wait for instructions; stay within your turf; and protect your backside. This restrictive environment is of course not conducive to creativity, flexibility, independence, and risk taking - the jargon of intrapreneurs. (Hill; 2003: 26). 2.8.3. Lack of Entrepreneurial Ability Entrepreneurship is a concept and it can be defined as a creation of new organization or as creation of new economic activity or as the pursuit of innovation (Rocha; 2004:363-367). And an entrepreneur discovers, evaluates, and exploits opportunities to create new goods and services (Hall and Sobel; 2006: 2). When we look at definition of intrapreneurship we see that an intrapreneur acts as an entrepreneur. Therefore to be able to realize the intrapreneurship in a company it is necessary to have entrepreneurial tendency and ability. So lack of entrepreneurial tendency can be accepted as a barrier to intrapreneurship. 2.8.4. Unsuitable Compensation Methods Organizations that are replete with unhealthy political activity, infighting, and uncooperative organizational members have a very difficult time bringing out the best in people to create better business performance. (Eesley and Longenecker; 2006: 19). Intrapreneurs and managers are different. Traditional methods of rewarding -as increasing remuneration and promotion- are useful for managers to provide support for effective work while these methods are rarely work for intrapreneurs. Those methods remove them from the area in which innovative, and characteristically they do not make good corporate managers (Hill; 2003: 27). 2.9. Research on developing measurement for intraprenuership Although there is a relatively small amount of research that has been conducted in the area of intrapreneurship, there is a growing research foundation to support the concept of

27

intrapreneurial intensity. Building on the work of Miller and Friesen (1983) on innovation in conservative and entrepreneurial organisations, a number of researchers have reported success in measuring a companys entrepreneurial orientation, and linking that orientation to various strategic and performance variables. Kuratko, Montagno and Hornsby (1990) developed an intrapreneurial assessment instrument to determine the effectiveness of a corporate entrepreneurial environment. In their study they looked at how to best evaluate an environment that is conducive to corporate entrepreneurship, or intrapreneurship. According to Kuratko, Montagno and Hornsby (1990), this type of rationalizing is difficult because corporate entrepreneurial activity is behaviourally complex and very dynamic. However, they concluded that there are three key factors that affect the development of corporate entrepreneurial activity, namely: management support, organizational structure, and resource availability. The authors also stated that this type of research could be important for corporations that desire to implement an intrapreneurship programme within their corporate structure, so that they can evaluate their assets and shortcomings in being able to foster entrepreneurial activity. The Intrapreneurial Assessment Instrument was developed to provide for a

psychometrically sound instrument that represented key entrepreneurial climate factors in the existing intrapreneurship literature (Kuratko & Hodgetts, 1995, p.110). The responses to the Intrapreneurial Assessment Instrument were statistically analyzed and resulted in five factors, which are aspects of the organization over which management has some form of control. These factors include management support, autonomy / work discretion, rewards / reinforcement, time availability and organizational boundaries. These factors form the foundation to ascertain whether or not an organization has the climate that would support intrapreneurship (Kuratko & Hodgetts, 1995). Pinchot and Pellman (1999) developed a similar instrument known as the Innovative Climate Questionnaire. This questionnaire consisted of nineteen Innovative Success Factors that together create the conditions for costeffective innovation. They audited these factors in a large number of organisations and found them to be fundamental measures of organizational health as well as capacity for innovation. However, the Innovative Climate Questionnaire can again only be used to predict an organizations capacity to have an innovative climate, and does not measure whether or not an organisation is intrapreneurial in nature.

28

According to Elizabeth Hill (2003), The University of Cape Town's Graduate School of Business, headed by Michael Morris, developed the Entrepreneurial Performance Index Survey in 1997. This study explored three aspects of entrepreneurship, namely innovativeness, risk-taking and proactiveness as a measure of entrepreneurial intensity, which is defined as a linear combination of these three factors, and the frequency with which entrepreneurial events occur (Morris, 2001). Described as the first initiative of its kind in the world, the Entrepreneurial Performance Index database was designed to examine the relationships between company entrepreneurial orientation and company strategy, structure, reward systems, performance, approaches to control, Human Resources policies, and related managerial variables (Elizabith Hill 2003). A study was conducted in 1997 using the Entrepreneurial Performance Index on a sample of more than 30 South African companies. The sample represented various sectors, including publishing, financial services, manufacturing, high technology, energy and retail. The survey focused on two key elements. Firstly, the frequency of entrepreneurship, which was concerned with the numbers of new products, services and process innovations implemented by a company over the past two years. Secondly, the degree of entrepreneurship, focused on the extent to which managerial efforts could be characterized as innovative, proactive and entailing calculated risk-taking According to Morris (2001, p.95), the Intrapreneurial spirit needs to be integrated into the mission, goals, strategies, structure, processes and values of the organization. With this in mind, Tushman and Nadlers (1997) Congruence Model for Organizational Analysis, which examines the core elements of an effective organization, can be used as a conceptual framework for examining Intrapreneurship within an existing organization.

29

Figure 1: Tushman and Nadler (1997) Congruence Model for Organizational Analysis

Source: Elizabeth Hill (2003); The development of an instrument to measuring intrapreneurship. Tushman and Nadlers (1997) Congruence Model for Organisational Analysis suggests that there are four interconnected elements of an organisation namely; task, individuals, formal organisational arrangements and informal organisation, which are ultimately affected by each other, as well as various external factors including the environment, resources available and the history of the organisation. This model is a general model, which can be used as the basis for a more specific model, in this instance a model for intrapreneurship. Each of these four elements consists of various observable indicators, which can be related to intrapreneurial performance. In other words, if an organization demonstrates these various characteristics, and if they are aligned with and mutually supportive of each other, the organisation will score highly in that area, allowing for the conclusion to be drawn that the organisation is intrapreneurial in nature (Elizabeth Hill 2003). Based on the Tushman and Nadlers (1997) Congruence Model for Organizational Analysis, Elizabeth Hill (2003) developed an extended model that can be used in assisting the measurement of intrapreneurial intensity index. This adapted model includes 6 variables namely: task, organizational structure, policies, people, leadership and culture.

30

Figure 2: Adaptation of Tushman and Nadler's (1997) Congruence Model for Organizational Analysis

Source: Elizabeth Hill :( 2003), the development of an instrument to measuring intrapreneurship 2.10. The conceptual model for this study As included in the above paragraphs, several authors have identified several factors as determinant to the presence of intrapreneurship; and their absence will inhibit intrapreneurism. Though there is no a universally applicable model available to measuring Intrapreneurship, most of the instruments used by the authors Kuratko et.al, (1990), Pinchot and Pelman(1999), Elizabeth Hill (2003) and others , identify certain critical variables that affect Intrapreneurship. These include; organizational factors, management activities as well as employee factors (Zahara, 1991, Antonic Hisrich 2001, Heinonen 1999, Hornsby et al. 1993). Based on the review then the researcher has slightly adopted a model on the works of Kuratko, Montagno and Hornsby (1990) Elizabeth Hill (2003), Ahmad et.al (date not stated) as well as Jarna and Kaisu (date not stated), with three attributes as factors crucial to the existence of intrapreneurism and four intrapreneurism. variables as manifests or outcomes of

31

Table 3: Factors crucial for intrapreneurial behavior

Factors intrapreneurship

influencing Researchers

Organizational attributes Structure Culture Reward systems

Hisrich & peters , 1986, Zahra 1991,1992, Hornsby et.al.,1993, Burgelman & Sayles, 1986, Kuratko, Montagno and Hornsby (1990)

Management attributes Leadership Commitment support

Kuratko et al., 1993, Hisrich & Peters, 1986, Stevenson & Jarillo , 1990

Employee attributes Awareness Skills and Abilities

Hall and Sobel; Kuratko, Montagno and Hornsby (1990) Elizabeth Hill (2003), Ahmad et.al (date not stated) as well as Jarna and Kaisu (date not stated)

Source: Developed for this research Table 4: Manifests of intrapreneurship Manifests of intrapreneurism Researchers Organizational effectiveness Kuratko et al., 1993, Hisrich & Peters, 1986, Stevenson & Jarillo , 1990 Employee job satisfaction Customer satisfaction Renewal and innovation Kanter , 1985; Hisrich & Peters, 1986, Hall and Sobel; 2006 Hisrich & peters , 1986, Zahra 1991,1992, Hornsby et.al.,1993, Burgelman & Sayles, 1986

Source: Developed for this research

32

2.10.1 Operational definition The operational definition of the variables to be applied in this study is given as follows:Factors crucial for intrapreneurial behavior 1. Organizational attributes

The organizational attributes refer to the way work is being organized in the company: power and responsibility, division of work, rules and regulations, culture, reward systems as well as the kind of organizational structure used. Under this basic attribute, three items are identified for measurement. These are: Structure: The kind of organizational structure, the authority responsibility relationship and the span of control will be examined. Culture: At what extent the basic assumptions of intrapreneurship, Risk taking, innovation and creativity, learning, attitude to change etc. are present in the company. Reward systems: The way the organization rewards innovation and creativity and its policy in this regard. 2. Management attributes Commitment: how much committed is management in supporting innovation and creativity in terms of allocating the necessary resources and time to employees for. Leadership: how much capable and determined is management in leading the intrapreneurial endeavor, how much is it involved in as well. Support: support in problem solving, coaching, provision of moral backup and support in terms of conceptual and technical and the like are included. 3. Employee attributes Awareness: are employees well aware of the need for innovation and creativity for organizational and individual prosperity. Skills and abilities: do employees possess the necessary skills required and are able to apply them for the innovation and creativity in the organization. Manifests of intrapreneurship; 1. Renewal and innovation Renewal and innovation refers to the amount of new products, systems and processes developed in the company in the past few years and the amount of strategic improvement and adaptation undertaken on its missions goals, objectives and strategies in recent years.

33

2. Effectiveness of organizational activities Effectiveness of organizational activities refers to how well the company is effective in accomplishing its objectives at various levels, how well it performs organizational activities with out delay, how well it analyses activities to find out weaknesses, the improvements made on methods of doing jobs, the utilization of existing facilities and potential. This is also measured in terms of its financial position and market share relative to other competitors. Even though several factors may be available to measuring effectiveness of organizational activities, in this study the researcher takes only the companys financial performance in the recent years and its relative market share. 3. Employee job satisfaction Employee job satisfaction is the level of happiness employees drive from their job. To measure the level of employee job satisfaction, in this study the researcher investigats the level of employee happiness on the job, the value employees and others have to the work and the variety of the employees interest on the work. 4. Customer satisfaction Customer satisfaction is one manifest of the availability of intrapreneurship in the company. Meanwhile, customer satisfaction is used as one tool to measure its existence in this study. In this study customer satisfaction is taken as perceived by management. Thus it refers to the level of price quality relation satisfaction of customers, the customer relations, managements familiarity with customers needs, regular analysis of customers needs, etc. Research hypothesis Based on the conceptual model perused in this study, the researcher developed the following three hypotheses. Hypothesis 1 Organizational factors have positive relationship with intrapreneurship. Hypothesis 2 Management attributes have positive relationship with intrapreneurship. Hypothesis 3 Employee attributes have a positive relationship with intrapreneurship.

34

Figure 3: The model of intrapreneurship Organizational culture Organizational variables Organizational structure Reward systems

Leadership Management attributes Management commitment Management support

Employee awareness to innovation Employee attributes Employee skills and abilities

Factors affecting intrapreneurship Employee satisfaction Effectiveness of organizational activities Renewal and innovation Customer satisfaction

Intraprenurrial behavior

Manifests of intrapreneurship Source: Developed for this study

35

CHAPTER III: DATA PRESENTATION AND ANALYSIS

This chapter offers the results of the study. First it provides the demographic background of the industry and respondents profile, and then it shows how the data collected is relevant to the research questions, and identifies general trends and results in the leather footwear industry in Addis Ababa. Here, it provides the level of prevalence of the identified organizational, management and employee attributes in the industry, using descriptive analysis. By comparing the mean scores, it is shown whether each of the measures under the respective variables are in place to support intrapreneurial behavior or not. Next the chapter provides the relationship of the organizational, management and employee

attributes(independent variables ) with employee satisfaction, effectiveness of organizational activities and renewal and innovation(dependent variables ). Last it presents the relationship of the independent variables with intrapreneurship: computed as a cumulative value of the four dependent variables. Pearson correlation analysis is employed to analyze the correlation coefficients of the variables under study. 3.1. Demographic background of the industry and respondents profile. In the methodology part it is explained that the study limits itself to members of the Ethiopian leather industries association which are located in Addis Ababa. The locational limit is important because it appears to be difficult to reach the companies located outside the capital city. As a matter of fact the information collected from the association indicated that 93 percent of the leather footwear companies are located in Addis Ababa. The information indicated that there are about fourteen leather footwear companies which are members of the Ethiopian Leather Industries Association (table below) of these fourteen companies one is found outside of the capital city, thus it is excluded from the study. One of the members is also a cluster formed by several crafts leather footwear makers. A discussion with the secretary general of ELIA suggested that this cluster is formed only very recently. In addition to that regarding the nature of the cluster and its organization, it is not found to be convenient to this study. As this study considers only the mechanized manufacturing level companies, the cluster is excluded. Furthermore, one of the member companies focuses on producing shoe soles than leather footwear. Thus as the study focuses on predominantly leather footwear companies, this company is also excluded from the study. Therefore only

36

the eleven companies are found to be representatives of the industry. Therefore empirically the study uses these eleven companies for the sake of generalization. Table 5: leather footwear companies which are members of ELIA No. Company Name 1 2 3 Anbessa Shoe S/C Ethioleather Cluster Gelila Shoe Factory Line of Business Gentlemens shoes ,Ladies shoes Childrens shoes ,Shoe Upper Last Produce & Export: Gentlemens shoes Ladies shoes , Children shoes Produce & Export: Gentlemens shoes ,Sport Shoes ,Ladies shoes Childrens shoes Produce & Export: Gentlemens shoes Ladies shoes , Children shoes Produce & Export :Mens, shoes ,Womens shoes ,Sport shoes ,Childrens shoe ,Sandals Produce & Export:Gentlemens shoes Ladies shoes ,Childrens shoes Gentlemens shoes ,Ladies shoes Childrens shoes Produce & Export:Gentlemens shoes Ladies shoes ,Childrens shoes Produce & Export: Military shoe Gentlemens shoes ,Ladies shoes Childrens shoes Produce leather shoes, soles Produce & Export :Gentlemens shoes Childrens shoes Produce & Export:Adult foot wear Civilian shoes ,Military boots ,Durable boots Children s shoe ,Sandal ,Boots Childrens shoe ,Gentlemens shoes Ladies shoes Produce:Childrens Shoe ,Gentlemens Shoes Ladies shoes

4 5 6 7 8 9

Gamb Shoe Trading & Industry Jamaica Shoe Factory Kangaroo Shoe Factory Melese Teka shoe Factory Peacock shoe Factory Ramsie Shoe Factory

10 11 12

Pu PVC Leather shoe and sole factory Ras Dashen Shoe Factory Tikur Abaay Shoe S/C

13

Wallia Shoe Factory Park Shoe & Leather Product

14

Source: Ethiopian Leather Industries Association website (2010)

37

The researchers discussion with the secretary general of ELIA also reveals that for industry development purposes seven companies which are found to be on a better capacity are selected for knowledge transfer package arranged by the collaboration of the Ministry of Trade and Industry of the Federal democratic republic of Ethiopia and the Government of India. Recently, a delegation of 19 experts is working with the seven selected companies for capacity building and knowledge capacity. In this study the researcher took the seven companies as true representatives of the leather footwear industry in Addis Ababa. This is because; the Government itself has selected these companies on the basis of their potential and capacity to the development in the industry and as discussion with the secretary general of ELIA reveals, the companies are selected as representatives of the industry. Then the researcher selected four of these seven companies as unit of analysis for this study using simple random sampling technique. Chart 1: Location distribution of ELIA member footwear companies

1 Companies found in Addis Ababa Companies outside Addia Ababa

13

Source: official website of ELIA As per the information obtained from ELIA, totally the mechanized manufacturing level leather footwear industry in Addis Ababa employs a total of 2990 employees with the 11 companies. Of this number 2500 i.e. 84 percent are absorbed by the seven companies which are selected for the capacity building package. As it is indicated in the chart below, the total number of employees in the selected companies are around 1400 and 78 management level personnel are also present.

38

Chart 2: distribution of employees and management personnel considered in the study

3000 2500 2000 1500 1000 500 0 Industry population 2850 140 2990 Sample respondents 166 14 180

Unit of analysis 1400 78 1478

1 Employees 2 Management 2 Total

Source: researchers survey Thus from 1400employees, 180 employees are selected for the study using simple random sampling technique. To secure maximum response rate, the researcher used a controlled structured questionnaire. The numbers of management personnel included in the study are selected based on judgmental sampling method. This method is preferred because based on the nature of the study only management personnel found in the production, R& D (non existent in the surveyed organizations), and marketing management departments are relevant for responses. Thus judgmentally, management personnel found in the said departments are contacted using self- administered questionnaires which are distributed to 20 targets ( 26 % of the population in the selected companies) and of the distributed 20 questionnaires, 14 are completely and correctly filled and returned and all the returned questionnaires are used for analysis.

39

Profile of respondents Table 6: Profile of respondents included in the analysis

Gender Valid Male Female Total Age Valid 18 - 30 31 - 40 41 - 60 Total Educational qualification Valid < 10+2 10+2 Diploma First Degree Above Degree Total Frequency 90 90 180 Frequency 15 125 40 180 Frequency 127 25 15 12 1 180 Percent 50.0 50.0 100.0 Percent 8.4 69.4 22.2 100.0 Percent 70.7 13.9 8.4 6.5 0.50 100.0 Valid Percent 50.0 50.0 100.0 Valid Percent 8.4 69.4 22.2 100.0 Valid Percent 70.7 13.9 8.4 6.5 0.50 100.0 Cumulative Percent 70.7 84.6 93.0 99.5 100.0 Cumulative Percent 8.4 77.8 100.0 Cumulative Percent 50.0 100.0

Work experience in the company Valid 6 months - 2 years 3-5 years 5-10 years > 10 years Total 32 64 68 16 180 17.8 35.6 37.8 8.8 100.0 17.8 35.6 37.8 8.8 100.0 17.8 53.4 91.2 100.0

Working position Valid Employees management Total 166 14 180 92.2 7.8 100.0 92.2 7.8 100.0 929.2 100.0

Source: researchers survey The profile of respondents as illustrated in table 5 above indicates that there is equal number of male and female included in the study i.e. 50% each. There are 15, 125 and 40 respondents with ages of 18-30, 31-40 and 41-60 respectively. As far as educational qualification is concerned, 70.7 percent of the total respondents are at the less than 10+2 level of education, where as 13.9 and 8.4 percent are at the 10+2 and diploma levels respectively. Only 6.5 percent from the total respondents are degree holders and all of them

40

are found at managerial positions. Surprisingly only one individual is a masters degree holder. Regarding work experience , 32 or 17.8 percent of the respondents possess only 6 months to 2 years experience in their companies, whereas,64 or 35.6 percent are 3 to five years experienced in their companies. There are 68 workers with work experience of 5 to 10 years which occupy 37.8 percent. 16 respondents or 8.8 percent have a luxurious experience of 10 years or more. Among the 180 respondents, 166 or 92.2 are workers at a nonsupervisory position. 14 respondents or 7.8 percent are found at managerial positions. 3.2. The Prevalence of Factors crucial to Intraprenerial behavior in the industry An entrepreneurial literature shows, entrepreneurial organizations are characterized by a set of organizational attitudes and behaviors(Covin & Miles , 1999; Covin & Slevin, 1989; Kuratko,Naffziger and Montagno , 1993; lee and Pennings,2001;Lumpkin & Dress , 1996;Lyon,Lumpkin and Dress,200; Morris & Jones ,1999). Entrepreneurial organizations demonstrate competencies such as opportunity recognition (Miller, 1983; Stevenson& Jarillo, 1986), organizational flexibility (Murray, 1984; Naman & Slevin, 1993), and the ability to measure, encourage and reward innovative behavior (Zahra, 1993). In Addis Ababa leather footwear industry, Using descriptive statistics, the prevalence of the factors identified as influential to intrapreneurship are analyzed based on the responses of employees. With a five point likert scale i.e. 1=very low, 2=low, 3=moderate, 4=high and 5=very high, employees responses to each item stated in each variable are analyzed using the mean scores., based on the output of the SPSS statistical tool applied. Below the level of prevalence of each independent variable is presented one by one. 3.2.1. Organizational Culture Several authors such as Hisrich et.al (2005), Hornsby et.al (2006), Fredette and Michaud (1998), etc. state that the flexibility for trial and error, a multidisciplinary team approach, shared belief on the need for innovation, risk taking, realistic and communicated vision recruitment of enterprising people, are very important to the development of intrapreneurial behavior. To investigate the prevalence of intrapreneurial culture in Addis Ababa leather footwear industry, 9 items were developed for response. Meanwhile item number appeared to be difficult to be answered by most respondents, thus is excluded from analysis. The overall group mean of this variable showed M=2.11; which indicates a low prevalence rate (table )

41

As illustrated in the table, according to employees evaluation, the organizational culture that is believed to be crucial to the development of intrapreneurship is at its lowest level in the industry. Among the eight measures of organizational culture none scores barely above 2.5; which is the lowest mark for moderate level of prevalence. The responses indicate that tolerance to mistakes for innovation, encouragement of calculated risk taking, the level of team work, the recruitment of entrepreneurial people, the overall belief in the organization that innovation is a necessity to the organizations future, are all at the lowest level of prevalence. Table 7: Employees evaluation of the organizational culture in the industry Organizational culture n Mean S.D The prevalence of the widely held belief that innovation is an absolute .991 166 2.32 necessity for the organizations future. Whether there is strong emphasis on teamwork in the organization. If There is continual recruitment of individual entrepreneurs into the organization. Innovation and calculated risk-taking are encouraged. Whether the organization encourages individuals who have different views to stimulate innovation. Whether people in the organization are continuously encouraged to expand their capacities to achieve more. Whether there is extensive employee orientation program for new employees to ensure that employees share the corporate vision and 166 purpose. Whether mistakes in innovation are tolerated. Average Source: SPSS output 166 166 2.01 1.226 166 2.07 1.076 166 2.14 1.005 166 166 2.16 1.027 2.16 1.038 166 2.19 1.175

1.84 2.11

.860 1.082

(scale: 1=very low, 2=low, 3=moderate, 4=high, 5=very high)

The frequency distribution table on organizational culture shows that 60% of the respondents hold that the suitability of the organizational culture as per the items identified, is low whereas the rest 40% state that it is at the moderate state of prevalence (table : appendix 2).which is consistent with the mean analysis.

42

3.2.2. Reward systems According to Hisrich et. al ( 2005) intrepreneurs need to be appropriately rewarded for the energy, effort and risk taking expended in the creation of new venture. And rewards should not be limited and be based on the attainment of established performance goals and value based. Innovative efforts should also be recognized and the presence of time as well as financial and non-financial supports for innovation is of paramount importance. The ability to measure, encourage and reward innovative behavior is crucial (Zahra, 1993). Meanwhile the survey on the Addis Ababa leather footwear industry showed that the reward system in the industry is not suitable to facilitating intrapreneurial behavior (table). Table8: Employees evaluation of the reward systems in the industry
Reward systems Value-based compensation and reward system with unlimited earning potential for employees. Setting and evaluating goals related to innovative, risky and proactive behavior regularly. Presence of systems that offer both financial and non-financial rewards for entrepreneurial behavior. Employees receive recognition in the organization for innovative ideas and suggestions. Employees are given financial support for self-initiated and unofficial activity that is to the benefit of the organization. Employees are given non-financial support for self-initiated and unofficial activity that is to the benefit of the organization. 166 1.70 .975 166 1.70 .942 166 1.80 1.065 166 1.91 1.072 166 1.92 1.092 166 1.94 1.001 n Mean S.D

Source: SPSS output

1.82 1.019 Average 166 (Scale: 1=very low, 2=low, 3=moderate, 4=high, 5=very high)

There were nine items developed under the reward system construct to measure its prevalence. But because of insufficient responses three items i.e item 4, 7 and 9 are excluded from analysis. The average mean score of the six remaining items shows M= 1.82; which indicates that the reward prevalence of intrapreneurial reward system is at the critical lower level. According to employees beliefs the reward system in the industry is not congruent with the level required for an intrapreneurial environment.

43

All the six measures under this construct have a score of below 2.00 showing a significantly low prevalence of conducive reward system for intrapreneurship. The industry does not demonstrate a value based reward and compensation system (M=1.94), the level of financial and non- financial supports for self initiated activities that employees may undergo for the benefit of the organization is critically low (M=1.70), and in the industry the practice of setting and evaluating goals for innovative and proactive behavior is low (M=1.92). Furthermore the practice of providing financial and non-financial rewards for entrepreneurial behavior is also at its lowest point (M=1.91), providing recognition for innovative ideas and suggestions is also not appropriately in place (M=1.80). Traditional methods of rewarding as increasing remuneration and promotion are useful for managers to provide support for effective work while these methods rarely work for intrapreneurs. These methods remove them from being innovative, and characteristically they do not make good corporate managers (Hill: 2003: 27). Thus the industry should give due emphasis to intrapreneurial reward systems. The frequency distribution on the reward system shows that 52% of the respondents hold that its suitability is very low whereas the 33% and 15 % state that its suitability is found at the low and moderate level respectively (table : appendix 2).which is again consistent with the mean analysis. 3.2.3. Organizational structure The organizational setting: the way work is being organized in the company, power and responsibility, division of work, rules, the level of empowerment of employees in their frontiers, mutually agreement on goal etc, are all important prerequisites to the development of intrapreneurial behavior. {Thompson (1999), Hornsby et al. (1993), Antonic Hisrich (2001)}. Meanwhile, the study showed that structure of the organization is not a typical of intrapreneurial structure in the Addis Ababa leather footwear industry. For the organizational structure construct the researcher initially developed and included in the questionnaire, nine items. In the process item 1, 4 and 8 fetch insufficient responses and thus are excluded from final analysis. As it is illustrated in table, employees believe that workers at the lower levels of the organization have very little power over how they do their work (M=1.64) and the practice of defining clear goals which have been mutually agreed upon by

44

employees and management is low (M=1.88). In intrapreneurial organization, organizational structure is flat with wide span of control. But in the study industry this is hardly true, (M=2.07). Overall the organizational structure construct shows a mean average of M=2.00, which is a lowest scale in terms of suitability. Table9: Employees evaluation of the organizational structure in the industry
Organizational structure Whether the organization has flexible job designs rather than formal job descriptions. If the ideas and suggestions of lower level employees are taken seriously and valued. If the organizational structure has a wide span of control. Whether Employees are encouraged to manage their own work and have the flexibility to resolve problems. If the organization has clear goals, which have been mutually agreed upon by employees and management. Whether Employees at the lower levels of the organization have very little power over how they do their work. 166 1.64 .642 166 1.88 .971 166 2.00 1.039 166 166 2.19 2.07 1.122 1.012 166 2.25 1.164 n Mean S.D

Source: SPSS output

2.00 0.992 Average 166 (Scale: 1=very low, 2=low, 3=moderate, 4=high, 5=very high)

The frequency distribution on the organizational structure shows that 31% , 48 % and 21% of the employees rate its suitability as very low , low and moderate respectively (table : appendix 2).which is again consistent with the mean analysis. 3.2.4. Leadership Perhaps one of the most important things to present in facilitating intrapreneurial behavior is a wholehearted support embraced by management, both by their physical presence and by making sure that the personnel and financial resources are available (Hisrich et al, 2005). Visionary, persuasive, enthusiastic, charismatic and pragmatic leaders are of paramount importance.

45

As per employees evaluation, the level of intrapreneurial leadership present in Addis Ababa leather footwear industry is below moderate (table). Initially the researcher developed 6 items under this construct and during the analysis the 6th item is excluded from analysis because only few employees responded to the question. The remaining five items demonstrate a mean average value of 2.36, which indicates that the level of intrapreneurial leadership is low. Table10: Employees evaluation of the prevalence of intrapreneurial leadership in the industry
Leadership The level of leaders enthusiasm for innovative behaviors. The ability of leaders to persuade others to achieve a certain goal. Whether leaders use brainstorming to solve problems. Whether leaders could be described as visionary and flexible. Leaders have instilled an entrepreneurial philosophy in all employees in the organization. Average 166 166 2.10 2.36 1.036 1.053 N 166 162 166 166 Mean 2.69 2.46 2.32 2.24 S.D .953 1.153 1.139 .986

Source: SPSS output

(Scale: 1=very low, 2=low, 3=moderate, 4=high, 5=very high)

Table, shows employees responses regarding the level of intrapreneurial leadership in the study organizations. The level of leaders ability to persuade others to achieve a certain goal, is rated below moderate (M=2.46) by employees, employees also witness that their leaders havent instilled an entrepreneurial philosophy into their minds (M=2.10). The level of brainstorming practiced by leaders to solve problems is rated much below average i.e. M=2.32, employees also indicate that their leaders cannot be described as visionary. Furthermore, the level of enthusiasm and moral of leaders is rated low to moderate by employees (M=2.69). The overall intrapreneurial leadership level is rated low in the industry i.e. M= 2.36. The frequency distribution on leadership shows that 30% of the respondents hold that its suitability is very low whereas the 39% and 31 % state that its suitability is found at the low and moderate level respectively (table : appendix 2).which is again consistent with the mean analysis.

46

3.2.5. Management commitment According to Hisrich et al (2005), without management commitment and support at all levels, a successful intrapreneurial environment cannot be created. In Addis Ababa leather footwear industry, the level of management commitment is investigated with six items all of which are appropriately responded by significant number of employees. Thus all the six items are included in the final analysis. Accordingly, the responses of employees are analyses through descriptive analysis. The analysis provides that the overall average mean score of the management commitment construct is 2.08 indicating that the level of overall management commitment to innovative behaviors is low (table). Table11: Employees evaluation of the level of management commitment in the industry Management Commitment n Mean
Whether leaders demonstrate calculated risk taking ability Whether leaders continually examines potential new market opportunities.
166 166 166 166 166 166 166 2.08 2.16 2.13 2.20 2.02 1.87

S.D .947 .921 .992 1.126 .988 .821

Whether leaders find out what is blocking innovation and remove it. Whether leaders find out and reward sponsors and champions. Whether leaders always measure the rate of innovation.
Whether leaders always measure the climate for innovation.
Average

2.08

0.966

Source: SPSS output

(scale: 1=very low, 2=low, 3=moderate, 4=high, 5=very high)

Table 6, above, shows employees evaluation of the level of commitment of their leaders to innovation. Accordingly, the practice of calculated risk taking to innovation, the practice of removing obstacles for innovation, identifying and rewarding innovation sponsors and champions, measuring the rate and climate for innovation are all below 2.15; which is a low prevalence rate of commitment to innovative behavior. The frequency distribution on management commitment shows that 30% of the respondents hold that its suitability is very low whereas 51% and 19 % state that its suitability is found at the low and moderate level respectively (table : appendix 2),which is consistent with the mean analysis.

47

3.2.6. Management support Management support in terms of coaching, problem solving, technical and conceptual support, moral back up etc. are important ingredients to intrapreneurial behavior (Hornsby et al 1993, Antonic Hisrich 2001). To investigate the level of management support 6 items were developed and included in the questionnaire. In the process, all the six items were filled completely and properly, and therefore are all included in the final analysis. Thus based on the analysis it is found out that the overall mean score of management support is 2.20. This indicates that management support for intrapreneurial behavior is low in the industry. Table12: Employees evaluation of the level of management support in the industry
Management Support Management coaches and helps employees in the work place. Management provides moral backup for innovation. Management is assisting than supervising in the work place. Management sees matters also from the employees point of view Management provides technical and conceptual Support for new innovations. Management solves problems employees face in the work process. 166 166 2.07 2.17 1.018 .964 N 166 166 166 166 Mean 2.58 2.16 2.14 2.08 S. D .961 1.027 1.063 1.009

Source: SPSS output

2.20 1.007 Average 166 (Scale: 1=very low, 2=low, 3=moderate, 4=high, 5=very high)

According to employees beliefs, Only one item i.e. coaching of employees by management in the work place stands out slightly above 2.5 i.e. M= 2.58. The level of moral backup of management to innovation for employees, assistance of management to employees, the level of technical and conceptual support for innovations are all at their lowest point according to the perception of employees. Furthermore, management does not see matters from the employees point of view (M=2.08). And the level of managements involvement in solving problems employees face in the work process is low (M= 2.17). The overall prevalence level of management support in the study organizations is rated as M= 2.20; which is much low. According to he frequency distribution on management support ,24% of the respondents rate the suitability of support as very low whereas 50% and 26 % state that its suitability is

48

found at the low and moderate level respectively (table : appendix 2). this is consistent with the values found in the mean analysis. 3.2.7. Employee awareness to innovation Employee awareness level to the importance of innovation for organizational and individual development is an important prerequisite of intrapreneurial development. The more employees believe in and are initiated to, the higher the level of innovation (Hornsby et al 19993; Antoncic Hisrich 2001; Thompson 1999). Table13: Employees evaluation of the awareness to innovation in the industry Awareness to innovation n The level of consideration of innovation as a means of personal development. The level of understanding of ones contribution to the development of competitive advantage for the organization Level of initiation to look for new and innovative ways to improve the way to do things. The level of viewing change as an opportunity for improvement rather than as a threat to one identity. Level of eagerness and enthusiasm when new opportunities arise. The belief that innovation and renewal is crucial to the organization. Average Source: SPSS output 166 166 166 166 3.11 3.07 2.93 3.16 0.897 0.803 0.772 0.823 166 3.16 0.622 166 3.22 0.841 166 3.49 0.939 Mean S.D

(Scale: 1=very low, 2=low, 3=moderate, 4=high, 5=very high)

To investigate the level of employees awareness to innovation, the researcher developed 8 items which were included in the questionnaire. In the process only 6 of the 8 items fetched a significant response that appears to be sufficient for the analysis. Thus item 2 and 6 are excluded from the analysis. Based on the 6 items, the evaluation on employees self judgment showed that the level of employees awareness to innovation is moderate. Table, shows the level of awareness of employees to innovation. Thus according to the responses obtained , the belief of employees that innovation and renewal is crucial to their organization, the level of their initiation to look for new and innovative ways to improve the way of doing things, the level of their eagerness and enthusiasm when new opportunities

49

arise, are all rated slightly moderate. Employees self judgment on the level of the belief and understanding of ones contribution to the development of competitive advantage for the organization is at the moderate level (M= 3.22). And the level of employees consideration of innovation as a personal development is slightly above moderate i.e. M= 3.49, in relative terms. According to he frequency distribution on employee awareness to innovation,10% of the respondents rate it as low whereas 87% and 3 % indicate that they are moderately and highly aware of respectively (table : appendix 2) this is consistent with the values found in the mean analysis. 3.2.8. Skills and abilities Within the overall corporate environment, certain individual characteristics have been identified that constitute a successful intrapreneur of which presence of relevant skills and abilities are important ones (Hisrich et al 2005). According to employees belief, they possess the necessary skills and abilities as well as experience; M=3.07 and M=2.92 respectively; which are slightly at the moderate level. Meanwhile the level of relevant education is rated low i.e. M=2.20, and the practice of the study organizations in providing training to foster the skills of employees is rated slightly very low M= 1.53. Table14: Employees evaluation of the skills and abilities present Skills and abilities N The level of relevant education. Possession of skills that the job demands. Possessions of experience which will help employees try new things in the work process. The level of training that the organization provides to foster the skills of employees to help them undertake the job well. Average Source: SPSS output 166 166 1.53 2.43 0.814 0.791 166 2.92 0.763 166 166 Mean 2.20 3.07 S. D 0.854 0.731

(Scale: 1=very low, 2=low, 3=moderate, 4=high, 5=very high)

According to the frequency distribution on employee skills and abilities , 2%, 51% and 47 % of the respondents rate its level as very lo, low and moderate respectively (table : appendix 2) which is a consistent result with the result found in the mean analysis.

50

Chart 3: Frequency distribution of employee responses regarding the prevalence of the factors affecting intrapreneurship in the industry
20 18 16 14 12 10 8 6 4 2 0 Reward system Organizational culture Organizational structure Employee awareness to innovation Employee skills and abilities Leadership Management commitment Management support

Response scale Very low Response scale Low Response scale Moderate Response scale High Response scale Very high

Source: Questionnaire analysis Chart 4: Overall average mean scores of the factors affecting intrapreneurship
3.5 3 2.5 2 Overall average mean scores 1.5 1 0.5 0
ct ur e tru Le M an ag e hi p om m ag itm ee em en aw en t ar ts en Em up es po pl s oy to rt ee in no sk va ills tio an n d ab ilit ie s Em pl oy M an tc tu r st em er s ul na lc

sy

at io

re w

at io

na ls

ar d

O rg

Source: questionnaire analysis

O rg

an iz

em en

an iz

ad

51

As one can see from the chart above, from among the eight independent variables which are supposed to affect intrapreneursip, the level of employee awareness to innovation stands out to be in a better position than the other variables. Employees skills and abilities as well as intrapreneurial leadership take the next 2nd and 3rd positions. On the other hand, the reward system, organizational structure,management commitment, organizational culture and management support take the lead from the bottom in that order. 3.3. Measuring The Prevalence of Intraprenerial behavior in the industry It is evident that intrapreneurship can give grounds for competitive adavantage of an existing organization. Prior researches indicated that intrepreneurial processes are associated with an organizations performance (Zahra, 1991; Zahra, 1995; Nielson et al, 1999, Heinonen 1999, Hisrich, 2001). According to Heinonen and Corvella (2003), organizational performance does not include only financial performance; it has other manifestations such as employee satisfaction, customer satisfaction, renewal and innovation as well as effectiveness in organizational activities. In fact these variables are crucial to financial prosperity. In this study, the level of intrapreneurship as dependent variable was measured with the four variables that are supposed to be manifests of intrapreneurship namely: renewal and innovation, customer satisfaction, employee satisfaction and effectiveness of organizational activities. The findings on the manifests of intraprenurial behavior are presented below one by one. 3.3.1.Renewal and innovation Intrapreneurship among other things is manifested through new product improvement, new manufacturing methods and procedures. According to Antonic & Hisrich (2001), renewal and innovation also addresses the transformation of organizations through the renewal of basic ideas on which they are built. It has strategic and organizational change nuances and includes the redefinition of the business conception, reorganization, and the introduction of system wide changes for innovation. To investigate the level of renewal and innovation in Addis Ababa leather footwear industry, the researcher developed 8 items which were included in the questionnaire filled by management personnel. Of the 8 items seven are completely and consistently completed and returned and one showed insignificant response rate. Thus it is excluded from the final analysis. Table, shows the response of management personnel in the industry regarding renewal and innovation. According to the responses obtained, the level of improvement of

52

current products in recent years and implementation of new methods or operational processes during recent years are slightly more than moderate i.e. M= 3.36 and M=3.07 respectively. The rate of new product introductions is also close to moderate (M= 2.93). On the contrary, the application of new and different ways in planning, the replacement of old methods and procedures with new ones, development of new products to replace current products for future markets in the coming years and improvement and/or modification of the structures and rules for facilitating organizational activities are all at the lowest point. According to the responses, the overall level of innovation and renewal is rated low to moderate (M=2.52). An intrapreneurial organization is expected to be proactive. Proactiveness is reflected through the attempt to lead rather than follow competitors in such key business areas as the introduction of new products or services, operating technologies and administrative techniques (Antoncic and Hisrich 2003). Meanwhile in the study industry organizations proactivness is rtaed to be low (M=1.79). Table 15: Management body evaluation of the level of renewal and innovation
Renewal and innovation n Application of new and different ways in planning. The rate of new product introductions in the past two to three years. Replacement of old methods and procedures with new ones. Current development of new products to replace current products for future markets in the next one to two years. Implementation of new methods or operational processes during the past two to three years. Improvement of current products from the past two to three years. Improvement and/or modification of the structures and rules for facilitating organizational activities. Average 14 14 2.14 2.52 0.663 0.746 14 14 3.07 3.36 0.829 1.008 14 1.79 0.579 14 14 14 Mean 1.71 2.93 2.14 S. D 0.611 0.829 0.663

Source: SPSS output

(Scale: 1=very low, 2=low, 3=moderate, 4=high, 5=very high

The frequency distribution table on renewal and innovation shows that 50% of the respondents hold low whereas the rest 50% state it is at the moderate state of prevalence(table : appendix 2).which is consistent with the mean analysis.

53

3.3.2. Employee satisfaction An intrapreneurial organization is one that provides varied duties in the work for employees and makes the job interesting to inspire employees to innovate. According to Zahra and Garvis (2000), in an intrapreneurial organization, employees value their job and are happy with it. Accordingly to measure the rate of employee satisfaction in the industry the researcher developed 6 items which are all included in the employee questionnaire and are fully completed for final analysis. Table, shows the responses regarding employee satisfaction. According to the responses obtained from employees, employees self value to their work is slightly moderate (M=2.95), the level that employees feel important to their organizations is also rated low to moderate (M=2.63), the level of variety nature of the duties on the work is also rated low to moderate (M=2.55). On the other hand, employees happiness in their work, the interesting nature of the work and the level of others value to ones work are all rated at the lower level. The overall employee satisfaction has a mean value of 2.43, which is slightly low to moderate. This indicates that the employee satisfaction in the industry is one area to be given due emphasis. Table 16: Employee evaluation of job satisfaction Employee satisfaction N Employees happiness in their work. Employees self value to the work. How much interesting is the work to employees? The level of variety of duties in the work. How much employees feel important to their organization. How much others value the employees work? Source: SPSS output 166 166 166 166 166 Mean 2.16 2.95 2.27 2.55 2.63 S.D 0.841 1.111 0.812 1.03 0.968

166 2.02 0.786 Average 2.43 0.925 166 (Scale: 1=very low, 2=low, 3=moderate, 4=high, 5=very high)

3.3.3. Effectiveness of Organizational activities According to Zahra and Garvis (2000), effectiveness of organizational activities is one manifest of intrapreneurship. It includes, performing organizational activities with out delay,

54

utilization of existing potential and facilities, analysis of activities to find out weaknesses and improvements in methods and ways of doing organizational jobs. Achievement of organizational goals, employee and machinery productivity are part of effectiveness of organizational activities (Zahra & Garvis , 20000). On top of the empirical explanations, the researcher developed seven items to investigate the level of effectiveness of organizational activities in the industry. All the seven items are properly responded and are used in the final analysis. According to table, the responses obtained from management personnel show that the level of performing organizational activities without delay is rated low with a mean of 2.00. It is also indicated that the utilization of all existing potential and facilities in the organization is much low (M=1.86), and the level of achievement of organizational goals based on existing opportunities and facilities is also low (M=1.86). On the other hand the level of improvement of employee productivity and machinery productivity in recent years is significantly moderate and moderate to high respectively. Table 17: Management body evaluation of the level of organizational effectiveness Effectiveness of organizational activities n Performance of organizational activities with out delay. Utilization of all existing potential and facilities in the organization. Analysis of activities to find out weaknesses. Improvements made in methods and ways of doing organizational jobs in recent years. Achievement of organizational goals based on existing opportunities and facilities. The level of employee productivity in recent years. The level of machinery and equipment productivity in recent years. Source: SPSS output 3.57 0.852 Average 2.51 0.695 14 (scale: 1=very low, 2=low, 3=moderate, 4=high, 5=very high) 14 14 14 1.86 3.00 0.663 0.679 14 2.79 0.699 14 14 1.86 2.43 0.663 0.756 14 Mean 2.00 S.D 0.555

55

The researcher believes that this is due to the fact that foreign government and nongovernment organizations are working with the sector. It is found out that companies from Italy, Germany as well as Britain are working in improving the technical capacity of the leather footwear companies in Addis Ababa. It is also learnt that a delegation of 19 Indians is working with selected 7 leather footwear companies located in Addis Ababa ( among which four are included in the survey), to knowledge transfer and technical capacity building. Thus the productivity in the employees and machinery aspect is believed to be a result of this. The improvements made in methods and ways of doing organizational jobs are also at the moderate level (M= 2.79). The practice of analyzing activities to find out weaknesses is also low to moderate (M=2.43), according to the responses. 3.3.4. Perceived customer satisfaction The ultimate goal of any organizational endeavor is maximizing profitability bases on satisfied customers. And before the financial performance customer satisfaction comes. According to Antoncic & Hisrich (2003), customer satisfaction is one element of an intrapreneurial endeavor. And it is important to pursue intrapreneurism in the first place to meet the demanding customers needs and preference. Based on the literature revisited, the researcher developed seven items to investigate the level of customer satisfaction as perceived by management body. All the seven items are included in the final analysis. As illustrated in table management in the study organizations believe that customers are satisfied with the products of the company (M=3.71). They also indicate that their respective companies maintain a friendly customer relations (M=3.21). Customers satisfaction on the price quality relation of the products is at the moderate level (M=3.30). Familiarity with customers needs shows a low mean value (M=2.19). On the other hand, the responses indicate that the level of promptness and speed in customer responsiveness (M=1.93), the long-term orientation of customer relationships (M=1.79), and the practice of regular research and analysis of customers needs and demands (M=1.80), are all at the lowest level of development. The overall perceived customer satisfaction as per the responses is low to moderate i.e. M=2.56. As one can see the mean distribution, the lower level of research and analysis of customers needs goes consistent with lower level of responsiveness. Customer relationships are not so

56

much long term as it is indicated. This is also supported by the fact that familiarity with customers needs is low. Table 18: Management body evaluation of the level of customer satisfaction
Perceived customer satisfaction n Satisfaction of customers with the products of the company. Prompt and fast response to customers needs and demands. Familiarity with our customers needs. Friendly customer relations Long-term orientation in customer relationship. Customers satisfaction with the price-quality relation. Regular research and analysis of customers needs and demands Average 14 14 14 14 14 14 14 14 Mean 3.71 1.93 2.19 3.31 1.79 3.30 1.80 2.56 S. D 0.726 0.616 0.699 0.699 0.579 0.679 0.519 0.646

Source: SPSS output

(Scale: 1=very low, 2=low, 3=moderate, 4=high, 5=very high)

3.3.5. Summary of the prevalence of the manifests of intrapreneurship Chart, below summarizes the mean scores of the manifests of intraprenurship. It indicates that customer satisfaction is low to moderate, employee satisfaction low, effectiveness of organizational activities low to moderate and renewal and innovation low to moderate. Chart 5: Overall average mean scores of the manifests of intrapreneurship
Overall Average mean scores 2.6 2.55 2.5 Overall Average mean scores 2.45 2.4 2.35 Effectiveness of organizational effectiveness Employee satisfaction Customer satisfaction Renewal and innovation

Source: researchers survey

57

3.3.6. Summary of the frequency distribution of the responses regarding the manifests of intrapreneurship As one can see from the chart, the frequency distribution of raw responses is very much consistent with the results obtained in the mean analysis. It is indicated in the chart that the responses for effectiveness of organizational activities in the industry as a whole is 50% moderate and 50% low as per management personnel opinion. Employee satisfaction measure shows that 46 % and 34% stand for low and moderate respectively. While 10% and 5% indicate very low and high satisfaction level respectively. As the majority 46 % and 34% are in low and moderate levels, the overall employee satisfaction level is rated low to moderate. Of the 14 respondents at the management level, 51% hold that the level of renewal and innovation is moderate, while the rest 49 % hold that it is at the low level Chart 6: frequency distribution of the responses to the manifests of intrapreneurship
60 50 40 30 20 10 0 Very low low moderate scale high Very high

Employee satisfaction Effectiveness of organizational activities Custpmer satisfaction Renewal and innovation

Source: researchers survey This indicates that renewal and innovation is between low and moderate in the industry. And this result is consistent with the results obtained in the mean analysis. The level of customer satisfaction is also found between low and moderate, as 52% and 48% stand for moderate and low respectively.

58

3.4. The relationship between the prerequisites and manifests of intrapreneurship One major objective of this study is to explore the relationship of organizational, management and employee attributes with intrapreneurship in general and with the manifests of intrapreneurship: employee satisfaction, effectiveness of organizational activities, renewal and innovation as well as customer satisfaction separately. To explore the relationships, Pearson correlation analysis is employed. The table below presents the data relative to the relationship between the independent variables and the dependent variables. Table 19: Correlation of the independent variables and the dependent variables
Organi zationa Manage Awarene Employe l ment manage ss to e Skills organizatio reward structu leaders commit ment innovatio & nal culture system re hip ment support n abilities Employee satisfaction customer satisfaction innovation and renewal Organizational effectiveness r Sig. r Sig. r Sig. r Sig. .437** .002 .099 .049 .474** .001 .504** .000 .537** .501** .318** .000 .320* .003 .010 .099 .037 .279* .009 .090 .050 .497* .001 .250* .006 .221* .018 .195* .012 .129 .041 .159 .018 .120 .045 .577** .000 .467** .001 .520** .000 .253* .041 .120 .043 .866** .000 .494** .001 .692** .000

.437** .487** .001 .001

.120 .517** .043 .336* .005 .001 .300* .010

.127 .430** .494** .028 .001 .001

intrapreneurship r

.690** .469** .508** .000

.296* .682** .003 .000

Sig. .000 .000 .001 **. Correlation is significant at the 0.01 level (2-tailed). *. Correlation is significant at the 0.05 level (2-tailed).

Source: SPSS output As the table illustrates, all the identified independent variables showed a positive relationship with the dependent variables. Reward system, organizational culture, organizational structure, management support, leadership, employees awareness to innovation, and possession of skills and abilities by employees all demonstrate a positive relationship with the independent variables. In the following section the relationship of each of the independent variables with the dependent variables is provided separately.

59

3.4.1.Organizational culture Organizational culture is supposed to affect intrapreneurial behavior. The level of risk taking, tolerance to mistakes and the belief in the importance for innovation for organizational growth are important ingredients to intrapreneurial behavior. Antonicic & Hisrich (2001), Zahra (2000), Hill (2003); stress that established culture of team work with cross functional participation , recruitment of enterprising people and tolerance to mistakes in innovation are crucial to intrapreneurial environment. The investigation of the relationship in this study reflects the same proposition. Table 20: correlation of organizational culture with the dependent variables The independent variable Correlation Employee satisfaction Dependent variables Organizational Customer effectiveness satisfaction Renewal and innovation Organizational r culture Sig. .437** .002 .504** .000 .049 .469 .474** .001

Source: SPSS output As can be seen from the above table organizational culture demonstrates a positive significant correlation with all the dependent variables; r=0.437 with employee satisfaction, r=0.504 with organizational effectiveness r= 0.474 with renewal and innovation as well as r=0.049 with customer satisfaction. The relationship of organizational culture and customer satisfaction though positive is weak apparently; indicating that organizational culture may not significantly contribute to customer satisfaction. Thus with the exception of customer satisfaction, all the relationships are well over 0 .430 which is significant relationship. 3.4.2. Reward systems Hisrich (2005) and Zahra (1993), stress that inappropriate reward system is an important inhibiting factor to intrapreneurial behavior. Thus identifying and rewarding intrapreneurial behavior is crucial. This shows empirically that reward system has positive relationship with intrapreneurial behavior. The correlation analysis undertaken in this regard supports this proposition strongly.

60

Table 21: Correlation of reward systems with the manifests of intrapreneurship The independent variable Correlation Employee satisfaction Dependent variables Organizational Customer effectiveness satisfaction Renewal and innovation Reward systems r Sig. .501** .000 .127 .028 .320* .001 .437** .001

Source: SPSS output Table, shows the relationship of reward systems with the manifests of intrapreneurship. Reward system and employee satisfaction demonstrate a correlation coefficient of 0.501, showing that the level of reward system highly influences employee satisfaction supporting this finding , Hornsby et al (2005), indicate that properly rewarded employees have better satisfaction than improperly rewarded ones. This shows the higher and wide the reward systems, the higher will be the employee satisfaction. It is also shown that the level of reward system highly influences innovation and renewal (r=0.437); a positive significant relationship. Organizational effectiveness and customer satisfaction exhibit correlation coefficients of 0.127 and 0.320 respectively, again showing a positive relationship. 3.4.3. Organizational structure Traditional and bureaucratic structures negatively affect the innovation ability of organizations ( Antoncic & Hisrich 2001).several other authors also support this proposition. The investigation of the relationship of organizational structure with the manifests of intrapreneurship reveals the same result in this study. Table 22: Correlation of organizational structure with the dependent variables The independent variable Correlation Employee satisfaction Dependent variables Organizational Customer effectiveness satisfaction Renewal and innovation Organizational r structure Sig. .318** .000 .430** .001 .099 .037 .487** .001

Source: SPSS output

61

As it is indicated in the above table, organizational structure highly influences renewal and innovation (r=0.487). The structure of the organization has a positive relationship with organizational effectiveness and employee satisfaction as well; r=0.430, and r=0.318 respectively. Customer satisfaction exhibits r value of 0.099 showing that it has positive but weak relationship with organizational structure. This shows that the structure of the organization is invisible and does not have much impact on customer satisfaction directly. 3.4.4. Leadership Pinchot III (1985), states that leadership is an inherent part of the intrapreneurs job. He holds that intrapreneurial leaders need to be visionary, involved, supportive, persuasive and vigilant. The role of leadership is paramount to the flourishing of intrapreneurship in organizations (Pinchot III, 1985). Table 23: Correlation of leadership with the dependent variables The independent variable Correlation Employee satisfaction Dependent variables Organizational Customer effectiveness satisfaction Renewal and innovation Leadership r Sig. Source: SPSS output The impact of leadership on renewal and innovation as well as organizational effectiveness is found to be positive. Renewal and innovation scores an r value of 0.497 while organizational effectiveness scores 0.494, both showing a positive correlation with leadership. This shows that as leaders continue to be visionary, persuasive, participative, enthusiastic as well as capable of instilling intrepreneurial philosophy into employees minds, the higher will be the level of renewal and innovation as well as organizational effectiveness. The correlation of leadership with employee satisfaction and customer satisfaction shows an r value of 0.279 and 0.090 respectively. But the relationship is weak. The researcher believes that the weak relationship of leadership with customer satisfaction is because leadership is not visible to customers. But the weak relationship with employee satisfaction is may be because the items identified to measure leadership are directly aligned with innovative behavior, and employee self concerns with leadership are excluded. .279* .009 .494 .001 .090 .059 .497* .001

62

3.4.5. Management commitment Several authors state that among other things commitment of management at various levels is crucial to the development of intrapreneurial behavior. In this study though management commitment demonstrates a positive relationship with the manifests of intrapreneurship, the relationships are weak. Table24: Correlation of management commitment with the dependent variables The independent variable Correlation Employee satisfaction Dependent variables Organizational Customer effectiveness satisfaction Renewal and innovation Management commitment r Sig. .250* .006 .336* .005 .221* .018 .120 .043

Source: SPSS output Management commitment shows correlation coefficients of 0.336, 0.250, 0.221 and 0.120 with the four dependent factors organizational effectiveness, employee satisfaction, customer satisfaction and innovation and renewal respectively put in order.. 3.4.6. Management support The support of management in problem solving, moral back up and inspiration are crucial to the development of intrapreneurial behavior ( Antoncic & Hisrich ,2001; Zahara , 1993; Pinchot III, 1985). Table 25: Correlation of management support with the dependent variables The independent variable Correlation Employee satisfaction Dependent variables Organizational Customer effectiveness satisfaction Renewal and innovation Management support r Sig. .195* .012 .300* .006 .129 .061 .517** .001

Source: SPSS output As it is indicated in the above table, management support stands out to be an important positive element to renewal and innovation with a correlation coefficient of 0.517 which is a significant positive relationship. Management support also shows correlation coefficients of

63

0.300, 0.195 and 0.129 with organizational effectiveness, employee satisfaction and customer satisfaction respectively. Though weak are the relationships. 3.4.7. Employee awareness to innovation As one might expect, the level of employee awareness to innovation is an important ingredient to innovative behavior. And this is observed in this study. Table 26: Correlation of employee awareness to innovation with the dependent variables The independent variable Employee r Correlation Employee satisfaction .159 .018 Dependent variables Organizational Customer effectiveness .467** .002 Renewal and

satisfaction innovation .120 .095 .577** .000

awareness to Sig. innovation Source: SPSS output The table above illustrates that the level of employee awareness to innovation and renewal is an important element to the prevalence of renewal and innovation in a given organization. The correlation coefficient 0.577 indicates that employee awareness to innovation attributes to the 57.7% variability in innovation and renewal. This shows that when employee believe that innovation is crucial to the organization, when they have a tendency to look into things in different and new ways, when they try new things even if failure exists, when they consider innovation as personal development and when they are adaptive and resilient to changes and new opportunities, the level of innovation and renewal in the organization will be significantly higher. Employee awareness to innovation and renewal has also shown a significant positive relationship with organizational effectiveness with a correlation coefficient of 0.467. Employee satisfaction and customer satisfaction exhibit positive r values of 0.159 and 0.120 respectively indicating weak but positive relationship. 3.4.8. Employee skills and abilities Pinchot III (1985), Hisrich et al (2001),Heinonen (1999) stress that employees skills and abilities are probably one of the most crucial to the development of intrapreneurship. And as

64

expected, employee skills and abilities demonstrated one of the highest positive relationships with the manifests of intrapreneurship in this study. Table 27: Correlation of employee skills and abilities with the dependent variables The independent variable Correlation Employee satisfaction Dependent variables Organizational Customer effectiveness satisfaction Renewal and innovation Skills abilities and r Sig. .253* .041 .494** .001 .120 .043 .866** .000

Source: SPSS output Employee skills and abilities exhibits the highest correlation coefficient with renewal and innovation among the variables identified. It shows r=0.866; close to perfect positive correlation. This indicates that the more employee have the relevant education, the relevant skills ,relevant work experience and the more the organization provides appropriate tailor made trainings to foster the skills of employees , the higher will be the rate of innovation and renewal. Employee skills and abilities shows r values of 0.494, 0.253 and 0.120 with organizational effectiveness, employee satisfaction and customer satisfaction respectively. These relationships show among other things that possession of skills and abilities. This indicates that the possession of the appropriate skills by the side of employees positively contributes to effectiveness of organizational activities. On the other hand skills and abilities demonstrated a weak positive relationship with customer satisfaction. 3.5. Relationship of the organizational, management and employee attributes with Intrapreneurship Intrapreneurship literature highlights the importance of organizational factors for the persuit of intrapreneurship (Zahra 1991, Antoncic & Hisrich 2001, Heinonen 1999). Management activities such as leadership, support, communication, facilitation etc. are also influential factors. The individual skills and attitudes describe the capabilities and willingness of any potential intrapreneur to act intrapreneurially (Antonic & hisrich 2001). On top of these theoretical findings, the researcher developed and put forward three hypotheses, which are stated in the conceptual framework part.

65

Hypothesis 1: Organizational factors have positive relationship with intrapreneurship. Hypothesis 2: Management attributes have positive relationship with intrapreneurship. Hypothesis 3: Employee attributes have a positive relationship with intrapreneurship. In testing the hypotheses, the researcher took the cumulative scores of the dependent variables; employee satisfaction, organizational effectiveness, customer satisfaction and renewal and innovation, which are considered as manifests of intrapreneurship in the literature review. Then the correlation between intrapreneurship and the independent variables is tested using Pearson correlation analysis (see table below). Table 28: Correlation of intrapreneurship with the independent variables The dependent variable Corr The independent variables elati Organ on ization Manage manag Awaren coef organizati al ment ement ess to Employee ficie onal reward structu leader commit suppor innovati Skills & nt culture system re ship ment t on abilities .537** .690** .469** .508** .296* .682** .004 .000 .520** .000 .692** .000

Intrapreneurship r

Sig. .000 .000 .001 .000 **. Correlation is significant at the 0.01 level (2-tailed). *. Correlation is significant at the 0.05 level (2-tailed). Source: SPSS output

As indicated in the table above, all the independent variables identified as affecting intrapreneurship, have a positive relationship with intrapreneurship. Hypothesis 1: Organizational variables have positive relationship with intrapreneurship. To test this hypothesis, the correlation between the three organizational variables namely: organizational culture, organizational structure and reward systems is analyzed. Thus as it is indicated in the table above, all the three variables exhibit a significant positive correlation: 0.537, 0.690 and 0.469 to organizational culture, reward systems and structure respectively. The prevalence of appropriate reward systems is shown to be very crucial to the development of intrapreneurship. This factor shows a correlation coefficient of 0.690. Furthermore, the flatness of the organizational structure, its flexibility, empowerment of employees, informal job related contacts, taking the ideas and suggestions of lower level

66

employees, avoiding the hierarchical block and the provision of flexible job designs than formal job descriptions, are important facilitators of intrapreneurship. The development of intrapreneurship is also shown to be highly dependent on organizational culture. This factor shows r value of 0.537. this indicates that the existence of the widely held belief that innovation and renewal is crucial to the organizations future, encouragement of employees to expand their capacities, encouragement of employees to look to things in new and innovative ways, dissemination of the companys vision, missions and objectives to employees, continual recruitment of entrepreneurial people, a strong emphasis on team work, encouragement of innovation and calculated risk taking as well as tolerance to mistakes in innovation are all important ingredients to the development of intrapreneuship in the Leather Footwear industry in Addis Ababa. Therefore as all the three organizational variables demonstrated a significant positive relationship, as the above explanations provide, organizational variables do affect intrapreneurship highly. Thus this hypothesis is accepted. Hypothesis 2: management variables affect intrapreneurship. To test this hypothesis, the correlation between the three management variables namely: leadership, management commitment and management support is analyzed. Thus as it is indicated in the table above, all the three variables exhibit a significant positive correlation: 0.508, 0.296and 0.682 to leadership, management commitment and management support respectively. This shows that the visionary nature of leaders, their participative style, their ability to install an entrepreneurial philosophy into employees minds, their enthusiasm as well as their persuasive ability are crucial to intrapreneurial development. In addition to this, the ability of management to take calculated risk to seize growth opportunities, the continual examination of market opportunities, the identification and removal of problems blocking innovation, identification and rewarding of sponsors and change champions, the measurement of the rate of innovation and the climate of innovation are areas that management should be committed to in order to foster intrapreneurship in the leather footwear industry in Addis Ababa. Again the coaching ability, the provision of moral back up, assistance, problem solving, and the provision of conceptual and technical support by the side of management to employees is crucial to the development of intrapreneurship. Therefore as all the three management attributes demonstrated a positive relationship as

67

supported by the above explanation, management variables do affect intrapreneurship. Thus the second hypothesis is also accepted. Hypothesis 3: Employee attributes affect intrapreneurship. Possession of the appropriate relevant skills, education, experience and training by the side of employees proves to be an invaluable asset to the development of intrapreneurship in the leather footwear industry in Addis Ababa. This independent variable shows an r value of 0.692 with intrapreneurship. The level of employee awareness to innovation shows a correlation coefficient of 0.520. This is a significant positive correlation. Thus, the belief that innovation is crucial to the organization, the tendency to look into things in new and innovative ways, the resilience to opportunity and change, the trial of different approaches to things, the belief on oneself that one can contribute to the competitive advantage of the organization and the like are important ingredients to intrapreneurship. Therefore as both employee attributes demonstrated a significant positive relationship as supported by the above explanation employee attributes do affect intrapreneurship. Thus the third hypothesis is also accepted.

68

CHAPTER IV: SUMMARY, CONCLUSIONS AND RECOMMENDATIONS

4.1. Summary Of Findings The findings in this study reveal a number of important things. First in the study it is shown that all the identified variables as affecting intrapreneurship, exhibit a positive relationship. This provides an important lesson that all stakeholders in the sector should consider the facilitation of these variables to present in the industry so that intrapreneurship can develop. As the correlation analysis indicates, certain factors such as the reward system, employee skills and abilities, employee awareness to innovation, leadership, management support, organizational culture, organizational structure as well as management commitment are all important ingredients to the development of intrapreneurship. Of these three variables ; reward system , management support and employee skills and abilities show a large significant positive relationship with intrapreneurial behavior, indicating that if nurtured, they could highly contribute to the prevalence of intrapreneurial behavior in the leather footwear industry in Addis Ababa. Second it is found out that most of the variables identified as influential to intrapreneurship are in the lower level of prevalence in the industry .The descriptive analysis shows, with the exception of employee awareness to innovation, all the independent variables have a mean value of below, slightly above or equal to 2.00. Employee awareness to innovation shows a mean average of 3.16: which is slightly above moderate level, making it the only variable to be in a good condition in the leather footwear industry in Addis Ababa. The overall mean score of organizational culture is 2.13; which is a low prevalence level, showing that the organizational culture in the industry is not suitable to intrapreneurial behavior. The responses showed that risk taking and tolerance for mistakes in innovation are at the lower level. Pinchot III (1985), holds that you cant innovate if dont take risks. He states that intrapreneurial managers must remember that even big failures are learning experience. Thus mistakes should be tolerated. All items identified as measures of the reward system show a mean of below 2.00, indicating that the reward system present in the Addis Ababa leather footwear industry is not a typical of intrapreneurial behavior. As per the analysis, the visionary nature, intrapreneurial orientation, participation, risk taking ability and proactively of leaders is least available in the sector. The level of management

69

support in terms of coaching employees, providing moral backup for innovation, understanding employees perspectives, provision of technical and conceptual support for innovation and solving problems that employees face in the work are all at the lower level of prevalence. The commitment of management to innovation is also rated to be low. Management ability to take calculated risks when it requires, continually examination of market opportunities, identifying and remove obstacles blocking innovation, searching and rewarding sponsors, measuring the rate of innovation and the climate for it are all at the lower level. Thus the level of management commitment to innovation in the leather footwear industry in Addis Ababa is found to be low. The level of relevant education for employees in the industry is again at its lowest point as per the survey. Furthermore the companies do not have an established, regular and purposeful practice of providing tailor made trainings to their employees to develop their skill. The employee evaluation to the acquisition of skills and experiences is rather moderate. This indicates that the industry is dependent on on the job experience development of employees. The level of employee satisfaction is also rated to be low. The survey indicates that employees value their job in a good deal and they feel that they are important to their organization. The value that others (friends families etc.), give to the work is also rated to be low. The variability nature of the job is rated moderate. The level of organizational effectiveness based on the measures identified is low to moderate. Under these variables, items regarding employee and machinery productivity in recent years show a more than moderate mean value. In addition to that improvements made in methods and ways of doing organizational jobs in recent years also score close to moderate. Other than this, the performance of organizational activities with out delay, the utilization of all existing potential and facilities in the organizations, the analysis of activities to find out weaknesses, the achievement of organizational goals based on existing opportunities and facilities are all rated to be low. The responses showed that the satisfaction of customers with the products in the industry is moderate to high, and satisfaction with the price-quality relations is moderate. The nature of promptness and speed of response to customer demands, the long term orientation of customer relations and the level of regular research and analysis of customers needs and demands are all at a very critical low level. Generally the level of customer satisfaction is

70

low to moderate. As far as the level of innovation is concerned, there are product improvements in recent years to a moderate level. The industry also experiences to the moderate level implementation of new methods or operational processes during recent years. The rate of new product introductions in recent years is also rated to be moderate. On the other hand, the application of new and different ways in planning, improvement and/or modification of the structures and rules for facilitating innovation are at a critical low level of development. Proactivity is also least emphasized as the development of new products to replace existing products for future markets, is at the lower stage of development. Overall the level of renewal and innovation is rated low to moderate.

4.2.Conclusions First in the literature analysis it is understood that the Ethiopian Leather industry is one voracious sector for this country of ours as foreign currency earner and employment creator, where the leather footwear industry takes an important position now and in prospect. The government and other stakeholders give due emphasis to the sector on the belief that the industry will take its comparative advantage to local and international comparisons, to be a leading manufactured exporter. On the contrary, studies indicated that the sector is tied up with a number of problems, lack of innovativeness being one. Creating intrapreneurial behavior in the industry is of paramount importance to this respect, studying the factors affecting intrapreneurship and investigating their prevalence being the stepping stone. On top of this fact this study is justified. Meanwhile the findings in this study supported the previous beliefs that the level of innovation is low compared to the magnitude it is required to be. Based on the findings of the study the researcher concludes therefore the following points. Regarding the relationship of organizational, management and employee attributes with intrapreneurial behaviors: All the independent variables i.e. organizational variables, management attributes and employee attributes identified as essential to intrapreneurial behavior do have a positive relationship with the variables identified as manifests of intrapreneurship. All the independent variables also have a positive relationship with intrapreneurship. The level of reward system, management support and skills and abilities of employees stand

71

out to have the highest correlation with intrapreneurship; indicating that the more appropriate and higher these variables are present in the industry, the higher will be the prevalence of intrapreneurship. Regarding the prevalence of factors essential to intrapreneurial behavior: The organizational culture that prevails in the industry does not motivate innovation. The reward system is not satisfactory and not aligned with the system required to motivate intrapreneurial behavior. The structure of the organization in the industry does not facilitate intrapreneurship. The level of intrapreneurial leadership in the industry is low. The level of management support and commitment to intrapreneurial behavior is too low. Employees awareness to innovation is modest. Even though most employees evaluate that they acquire the necessary experience and skills through time on the work, the level of relevant education in the industry is low, and the level of training that companies provide to employees to upgrade the skills of employees is at a critical low point. Regarding the prevalence of intrapreneurial behavior Overall employee satisfaction is low; although employees value their work. The level of overall customer satisfaction as perceived by management is low to moderate. The level of overall organizational effectiveness is also low. The level of innovation and renewal is low to moderate. 4.3. Recommendations Based on the conclusions, the following recommendations are made: It is essential that the companies in the industry should articulate innovative visions and missions and communicate that well to employees and orient new comers. The companies in the industry should encourage innovation and calculated risk taking and tolerate mistakes in doing so. The companies should encourage employees to look into things in new and different ways and recognize the efforts of those doing so. The companies should establish a system of recruiting individuals with high entrepreneurial orientation.

72

 The companies should set value based reward systems and establish an unlimited earning potential as far as employees contribute to. The companies in the industry should establish financial and non-financial support for self initiated activities that employees may undertake to the benefit of the organization and recognize such efforts and provide sufficient resource slack to allow people to experiment with new business opportunities. Establish financial and non-financial rewards for innovative behaviors. Set clear innovative goals and get them mutually agreed with employees, set some time for employees to work on informal projects which are undertaken to the benefit of the organization. They should also practice cross functional team works. The companies in the industry should empower lower level employees and encourage employees to manage their own work with flexibility; they should also encourage informal job-related contacts across departments. In the industry the ideas of lower level employees should be given the required emphasis and should be provided flexible job designs than formal job descriptions because formal job descriptions limit activities of employees and block innovation. The organizations structures should be designed in a way that allow for the sharing of resources and should have a wide span of control. The organizations in the industry should make use of visionary and persuasive leaders who have entrepreneurial orientation and who can instill such orientation into the minds of employees. Leaders should also be very enthusiastic and possess a participative approach. The organizations should make use of leaders that are capable of taking calculated risks, and who can continually examine potential new market opportunities to the advantage of the organization. Leaders should also be capable of identifying and removing obstacles blocking innovation and should be one that can measure the rate and the climate for innovation. The management style in the industry should be coaching than supervising and always management have to provide a moral backup to employees for innovative behavior. Management should sometimes see matters from the employees point of view, should provide conceptual and technical support for innovation and solve problems employees face in the work process.

73

 The organizations should establish a system of recruiting individuals with relevant educational background and /or use an extensive and continual training to upgrade the skills of employees. The organizations should research and analyze customers needs and demands to increase their customers satisfaction. They should also establish a fast and prompt customer responsive system. The organizations should improve the delays in performing organizational activities, should use existing potential and facilities in the organization optimally, should analyze activities to find out weaknesses, and should be proactive in developing products for future markets. They should also apply innovative and different ways in planning. 4.4. Limitations Several researchers have attempted to understand the factors that stimulate or impede intrapreneurship. Areas such as external environment, organization, its strategy, and management activivties have been presented as factors affecting intrapreneurship (Guth & Ginsberg, 1990; Miller, 1983, Kuratko et al. 1990, Heinonen 1999). Thus both external and internal variables affect intrapreneurship. In this study the external variables are excluded from analysis. Thus the study is not exhaustive in identifying all the variables, which may limit the scope of generalizations. To this effect a more comprehensive research should be undertaken in the area. In addition, intrapreneurial behavior though measurable, requires longitudinal approach to investigate its development in the target sector. In this study data is collected only once and it is a cross-sectional design. The customer satisfaction measure is also undertaken through management responses; which may not represent the true responses of customers. Thus research that includes the direct responses of customers will be required.

74

V. BIBLIOGRAPHY A blueprint for the African leather industry: A development, investment and trade guide for the leather industry in Africa. (2002). Available on http://www.ali.bii/sol/blueprint/dev/BALI2002/.pdf Ahmad et.al (2002). Organizational factors affecting intrapreneurship in Agricultural Extension Organization in Iran. University of Tehran-IRAN. Available on http://www.tehran.ir/Agri/Tu/Extension. org./IRAN2002.pdf. Antoncic B. & Hisrich R.D. (2001).Intrapreneurship: Construct refinement and cross cultural validation, Journal of Business Venturing; 16(5), 495-527. Antoncic, B. & Hisrich R. D (2003), Clarifying the Intrapreneurship Concept, Journal of Small Business and Enterprise Development; 10 (1), 7-24.
Anu L. (2003). Entrepreneurial presentation. Available: http://www.catalystii.net. Borins S. (2002). Entrepreneuring in established companies. Homewood, Illinois: Irwin.

Burch, J. G. (1986),Entrepreneurship, New York: John Wiley and Sons. Cardellino P. and E. Finch (2006); Evidence of Systematic Approaches to Innovation in Facilities Management, Journal of Facilities Management, 4(3), 150-166. Carland, J. C. And J. W. Carland (2007), Intrapreneurship: A Requisite for Success; the Entrepreneurial Executive, Volume 12, 83-94 Covin, J.G, & Slevin D.p.(1989). Strategic management of firms in hostile and benign environments. Strategic management journal, 10(1), 75-87. Drucker, P. F. (1985), Innovative and Entrepreneurship, Practice and Principles. Harper & Row, Publishers, Inc. Diagnostic trade integration study, July 2004. Eesley, D. T. and C. O. Longenecker (January/February 2006), Gateways to Intrapreneurship, Industrial Management, 18-23. Engineering Capacity Building Programme (ECBP), 2009; Addis Aababa. Available on: http://www.ecbp.addis ababa. Footwear Design & Development Institute (FDDI), (2009) Addis Ababa. Available on: http://www.fddiindia.com.pdf

Gravetter & Forzano 2003: Research methods for the behavioral sciences New York. Thomson Wadsworth publishing. Heinonen, J & Korvela, K. (2003) How about measuring intrapreneurship: Small busisness institute. Turku school of economics and business administration.Available on: http://www.tukkk.fi/pki/julkaisut/konferenssit/EISB2003/Heinonen_Korvela_EISB2003.pdf
Hisrich, R. D., Peters, M. P. & Shephered (2005). Entrepreneurship: starting, developing and managing a new enterprise. Illinois: Irwin.

Hisrich, R. D.,&Peters, M.P.(1992). Entrepreneurship: starting, developing and managing a new enterprise. Illinois: Irwin. Hisrich, R. D., & Peters, M. P. (1995). Entrepreneurship. New York: McGraw-Hill Irwin. Hisrich, R. D., & Peters, M. P. (2002). Entrepreneurship. New York: McGraw-Hill Irwin. Hofstede, G. J. (1980). Cultures consequences: international differences in work-related values. California: Sage. Hill, M. E. (January 2003), the Development of an Instrument to Measure Intrapreneurship: Entrepreneurship within the Corporate Setting, Unpublished Thesis Department of Psychology Rhodes University International organization for knowledge economy and enterprise development Ethiopia: Innovation and Growth in international comparison (2006). Janczak, S. and S. Boiteux 2007), Understanding Intrapreneurship: a Process Model for the Logic of Action Used by Intrapreneurs , Journal of Business and

Entrepreneurship:http://findarticles.com/p/articles/mi_qa5424/is_200703/ai_n212863 41: 13:04:2010. Kuratko, D. F., R. V. Montagno and J. S. Hornsby, (1990), Developing an Entrepreneurial Assessment Instrument for an Effective Corporate Entrepreneurial Environment, Strategic Management Journal, Vol. 11, 49-58 Menzel H.C., R. Krauss, J.M. Ulijn, M. Weggeman (June 2006), Developing Characteristics of an Intrapreneurship- Supportive Culture, Eindhoven Centre for Innovation Studies, the Netherlands, Working Paper 06.10. Ministry of Finance and Economic Development (MoFED) Ethiopia: Building on Progress: A Plan for Accelerated and Sustained Development to End Poverty (PASDEP) June, 2007 Addis Ababa.

ii

Nachmias & Nachmias 1996: Research methods in the social science, 5th edition. New York St.Martins Press. Pinchot, G. (2000). Intrapreneuring: why you dont have to leave the corporation to become an entrepreneur. San Francisco: Berrett-Koehler. Pinchot, G., & Pellman, R. (1999). Intrapreneuring in action. San Francisco: BerrettKoehler. Pinchot, G., & Pinchot, E. S. (1994). Unleashing Intelligence. People Dynamics, 12, 10. Robbins, S. P. (1997). Organizational behavior. New Jersey: Prentice Hall International. Stevenson, H. H. And C. J. Jarillo (1990), A Paradigm of Entrepreneurship: Entrepreneurial Management, Strategic Management Journal, 11, 17-27. Zahra, S. A. and D. M. Garvis (2000), International Corporate Entrepreneurship and Firm Performance: the Moderating Effect of International Environmental Hostility, Journal of Business Venturing; 15, 469-492. Zahra, Shaker A. (1991) Predictors and Financial outcomes of corporate Entrepreneurship: An Explanatory study. Journal of Business Venturing, Vol.6, No.4, 259-285. Zahra, Shaker A. (1996) Governance, Ownership and Corporate Entrepreneurship. The Moderating Impact of Industry Technological Opportunities. Academy of Management Journal, Vol.39.No.6 1713-1735. Zahra, Shaker A. (1996) Corporate Entrepreneurship and Financial Performance: the case of Management Leveraged Buyouts. Journal of Business Venturing, Vol.10, No.3, 225-247. World Bank Group (2006), Available on: http://www.wbgroup.it/uk/julkaisut/konferenssi.html .

iii