How to Create a Culture of Intrapreneurs by Matt Cosgriff @FortuneMagazine May 5, 2016, 10:49 AM EDT E-mail Tweet Facebook Linkedin Share icons This piece originally appeared on Millennial. According to the Harvard Business Review nearly 70% of entrepreneurs hatched their now successful business idea inside an organization. The kicker? They could have been intrapreneurs, yet all of them jumped ship to launch their venture without the safety and security of a paycheck and in many cases with little to no funding. Stepping outside of an organization full of invaluable resources, brilliant minds and endless support to the unknown abyss known as entrepreneurship can seem like a daunting hurdle to any millennial. Yet despite the risks—obviously stepping out also comes with major upside if an idea turns into Facebook—many motivated and driven millennials would rather face that very unknown than the stable reality inside their organization. But why? And more importantly how do organizations change to encourage millennials to learn, fail, create and drive effective change? Creativity and Failing Are (Perceived as) Risky As organizations mature they become fixated on doing what it is that they’ve become extremely good at. They focus on their competitive advantage. This is ultimately critical to success and a fundamental element to scaling up a successful organization, but with that focus tends to come a certain level of risk aversion. However, extreme focus on the way things have been done, comes with another form of risk. The same risk that took Blockbuster and Borders Bookstore from relevant to non-existent. It’s called change. Many established organizations fall into the trap of perceiving creative thinking and failure as a risky proposition, when in fact, in today’s rapidly evolving world it is the inability to change that is far riskier. Make it Acceptable to Fail (a.k.a. to Learn) A popular entrepreneurial rallying cry—especially of those with a lean start-up mindset—is to “fail fast and fail often.” The idea is to rapidly expedite the process of learning by quickly testing various iterations of an idea. This allows ideas to be tested inexpensively and in a low-risk environment within an organization before an idea is backed with capital and resources. While this mentality is becoming more and more popular among start-ups, the idea of “failing” inside a long-standing, successful organization is almost incomprehensible. “But why would we try to fail?” said the (insert Fortune 500 company here) Senior Vice President quizzically. The critical takeaway for organizations is to encourage employees—especially millennials who tend to be creative and desperately want to have impact—to expedite their learning. Imagine for a second the knowledge that an established organization has learned over the last decade. Much of that knowledge came from successful product launches, failed marketing attempts, research and development, the list goes on. Now imagine for a second if that same organization could’ve learned everything it has over the last decade in just five years, 24 months or a remarkable 12 months? By expediting failure (i.e. learning) an organization can more rapidly arrive at success. Establish Structure Around Creativity and Testing It sounds almost oxymoronic to create structure around creativity, but creating that structure is critical to driving intrapreneurial success. If an organization encourages creativity and failure just to encourage it, there’s little to be gained. Instead organizations must structure a process for vetting, testing and scaling up successful ideas within their organization. Take the largest company in the world, Google, as an example. Here is a company, despite its massive size, that has famously allowed employees to spend 20% of their time at work running with entrepreneurial—or in this case intrapreneurial—ideas that will benefit Google. In fact, some of Google’s leading products lines, like Gmail and Google Reader (now defunct), emerged out of this company policy. Now most companies will never become Google, however, the point remains that it’s critical to have structure around supporting employee’s innovative visions (remember that 70% that leave?). Consider this: structure a process for allowing employees to pitch an idea or concept that they feel strongly about and that aligns with the company’s long-term strategy. Once an idea is green lighted for testing, encourage employees to build a prototype of their service or product idea to test with a select number of loyal customers that could benefit from the new solution. This allows rapid testing of the solution with an actual market of potential buyers and based on feedback and interest in a given solution, decisions can be made to move forward, pivot or cross the idea off the list, all before vast amounts of time, energy, and resources are dedicated to a particular solution. Partner Intrapreneurs with Reverse Mentors One of intrapreneurships greatest values to a company—especially for those that do it well—is the ability to spread learning and knowledge rapidly across a company. Rapid learning through calculated risk taking is ultimately worthless if the knowledge gained from successes and more importantly failures is kept among the small team of intrapreneurs and not disseminated throughout the broader company. This is precisely where the idea of reverse mentorship and intrapreneurship should collide. Reverse mentorship is simply the reversal of the flow of knowledge from top down to bottom up. Instead of managers educating subordinates, reverse mentorship advocates allowing employees on the front lines to send their intimate knowledge of customers wants and needs back up the proverbial food chain. As company intrapreneurs test hypotheses surrounding an idea and generate a more clear understanding of what customers want and need—and oftentimes establish what they do not want and do not need—it is critical that companies have a structure for disseminating that information out through the organization. A fundamental assumption learned among an intrapreneurial team might be the hidden secret to enhancing a product or service line on the other side of the organization, making it all the more critical that rapid learning and knowledge be spread throughout an organization at a rapid pace.