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The way up

Local companies are developing intrapreneurship programs to cultivate corporate leaders and drive innovation

By S. Adam Cardais
Staff Writer, The Prague Post
March 08, 2006

Sitting in a hotel room late last year, Hubert Hasler, the maintenance manager at Temelín power plant, waited for his next test. A woman posing as his secretary entered the room, just like she would if she were coming to work in the morning.

Except for one thing: She was dressed in shorts and a T-shirt, like "she was going to the beach," Hasler said. "It was pretty funny."

In a corporate program designed to test his management skills, Hasler knew there was no right or wrong way to deal with the situation — he just had to handle it efficiently.

Hasler got up, told the mock secretary she could not come to work dressed that way and politely asked her to go home and change.

It seems he took the right approach.

Hasler is one of the top performers in a recent talent assessment program at ČEZ, the country's largest power company. As a result of his performance in the assessment, Hasler has been selected to participate in ČEZ's corporate entrepreneurship pilot program.

The world's most successful multinational companies, including GE and 3M, use corporate entrepreneurship programs, also referred to as "intrapreneurship," to develop their most talented employees, and also to spark innovation — the Post-it note was created through an intrapreneurship project at 3M.

These programs create opportunities for "high-potential employees," as they're known in the corporate world, who haven't yet made it to the ranks of top management to prove their abilities by managing an entrepreneurial side project — such as turning around a poorly performing subsidiary — within the company. Those who perform well usually move up the corporate ladder; those who don't sometimes get the boot.

Now, two local companies with very different backgrounds, ČEZ and telecommunications provider Český Telecom, are developing their own intrapreneurship programs to attract and train talent and drive innovation.

'You never know'

ČEZ's intrapreneurship program is part of a talent development system the company launched in September 2005. ČEZ, which employs 6,000 workers here, selected 150 people from its production unit to go through a four-month program designed to evaluate business acumen, leadership, finance and other abilities.

By December, ČEZ had broken the participants into three groups. The 12 people with the strongest performance, including Hasler, were put into the first group. Many of these 12 haven't yet received their final evaluations, but all will be given new intrapreneurship assignments within the first half of the year to determine whether they live up to the results of their assessment.

"These are people with high potential, people who can grow and be in the pipeline for higher positions within the company," said Luboš Tejkl, deputy director of human resources at ČEZ. Now it's time to "try their capabilities in real jobs — just to prove whether the output from the assessment was right or not. You never know."

Český Telecom's program isn't as far along as ČEZ's. The company already has talent development programs such as Winning Opportunities for Women, but intrapreneurship won't be rolled out for another year or so.

The program will start in sales and branch out into other client oriented units. Český Telecom will select participants based on the projects that are created. The ultimate goal of the program is to give talented employees the flexibility and freedom to develop their abilities — which will hopefully bring results to the company.

"It's like preparing a field for seeds," said Rostya Gordon-Smith, chief HR officer at Český Telecom. "If you hire free-thinkers and doers, you need to create an atmosphere where they can do it. If you really want people to create something, there cannot be limitations."

That ability to be flexible and creative is the main reason why HR is essential to developing entrepreneurship programs in corporations that often have rigid systems, according to experts.

"HR is absolutely necessary, since they can most readily be outside of the box," G.M. Smith, a visiting lecturer at the University of Pittsburgh Katz Graduate School of Business who gave a seminar on intrapreneurship in Prague in January, wrote in an e-mail.

A lot at stake

When it comes to intrapreneurship, GE is often held up as the model. Its system is embedded in its talent development and succession-planning program.

In GE's Leadership Development Program, participants are expected to complete a project once every six months. The program is highly competitive and aims to promote new hires to middle management in two to two and a half years.

Participants are evaluated once a year, and the lowest performers are unlikely to have management careers at GE, said Leslaw Kuzaj, GE national executive for the Czech Republic, Poland and Lithuania.

ČEZ is expecting the same kind of tangible results from its batch of intrepreneurs. Whether they're selected for a special project, such as renewable energy, to turn around a poorly performing power plant or a foreign posting, ČEZ is expecting these people to come up with a breakthrough, Tejkl said.

For the 12 selected participants, there's a lot at stake. Tejkl estimated that only six of the 12 will be successful. And although Gordon-Smith said Český Telecom will try to create a program where it's impossible for participants to fail, she conceded that this is unlikely.

The companies are risking a lot as well. While it's difficult to quantify the costs of creating an intrapreneurship program, the investment, both in terms of human resources and money, is significant.

GE spends $1 billion (23.6 billion Kč) a year on employee training, and Tejkl said the costs behind ČEZ's new program could reach into the tens of millions of crowns. That's one reason ČEZ will wait for the results of the pilot before considering expanding the program to other departments.

The risk of not creating an entrepreneurial environment within a large corporation, however, outweighs the risk of failure, said Gordon-Smith.

"Yes, it's costly, and, yes, it's risky," she said. "But the company that doesn't create intrapreneurship opportunities is doing it at its peril."

S. Adam Cardais can be reached at acardais@praguepost.com







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