Middle managers' perception of the internal environment for corporate entrepreneurship: assessing a measurement scale

This study assesses the measurement properties of a scale that measures the key internal organizational factors that influence middle managers to init iate corporate entrepreneurship activities. In this study, corporate entrep reneurship is used in a broad sense to include the development and implemen tation of new ideas into the organization. Using this definition, this stud y describes an instrument used to empirically identify the internal conditi ons that influence middle manager's participation in corporate entrepreneur ship activities. During the last decade, the role of the middle manager in corporate entrepreneurial activity has been recognized in the literature. T he empirical research on the internal organizational factors that may foste r middle manager activity has been limited, both in volume and scope. Howev er, the literature does converge on at least five possible factors. The app ropriate use of rewards: The literature stresses that an effective reward s ystem that spurs entrepreneurial activity must consider goals, feedback, em phasis on individual responsibility, and results-based incentives. This fac tor, therefore, highlights middle managers' role in this regard. Gaining to p management support: The willingness of senior management to facilitate an d promote entrepreneurial activity in the organization, including championi ng innovative ideas as well as providing necessary resources, expertise or protection. This, factor captures middle managers' role in this area. Resou rce availability: Middle managers must perceive the availability of resourc es for innovative activities to encourage experimentation and risk taking. Supportive organizational structure: The structure must foster the administ rative mechanisms by which ideas are evaluated, chosen, and implemented. St ructural boundaries tend to be a major stumbling block for middle managemen t in corporate entrepreneurial activity. Risk taking and tolerance for fail ure: Middle managers must perceive an environment that encourages calculate d risk taking while maintaining reasonable tolerance for failure. The liter ature on the internal factors was utilized to develop an assessment instrum ent called the Corporate Entrepreneurship Assessment Instrument (CEAI). The instrument contained 84 Likert-style questions that were believed to asses s a firm's internal entrepreneurial environment. Understanding middle manag er perceptions about the internal corporate environment is crucial to initi ating and nurturing any entrepreneurial process. A scale such as the CEAI, therefore, could be very useful for companies that wish to embark on a stra tegic transformation through corporate entrepreneurship. The measurement pr operties of the CEAI, including a factor analysis and reliability assessmen t, were determined. Results confirmed that five distinct internal organizat ional factors, similar to those suggested in the literature, do exist. Base d on how the items loaded on each factor, the factors were entitled managem ent support, work discretion, organizational boundaries, rewards/reinforcem ent, and time availability. The reliability of each of these factors also m et acceptable measurement standards. From a managerial perspective, the res ults indicate that CEAI can be a useful tool in diagnosing a firm's environ ment for corporate entrepreneurship, identifying areas where middle manager s can make a significant difference, and develop strategies that can positi vely spur and sustain corporate entrepreneurship efforts. The results of su ch diagnosis can be useful in designing effective training programs for mid dle managers. (C) 2001 Elsevier Science Inc. All rights reserved.