Assessment of corporate entrepreneurship and the levels of innovation in the South African short-term insurance industry

Abstract

The global economy is creating profound and substantial changes for businesses and industries throughout the world. These changes make it necessary for businesses to examine their purpose carefully and to devote a great deal of attention to selecting and following strategies in their pursuit of the levels of success that have a high probability of satisfying multiple stakeholders. There is a significant amount of written consensus regarding corporate entrepreneurship as a means for promoting and sustaining global corporate entrepreneurship and economic growth. This consensus focuses mainly on international businesses and not on South African businesses. Before corporate entrepreneurship and innovation can be instilled in an industry or business the current status must first be determined. Little empirical research is available in the South African context that indicates the successes and failures of corporate entrepreneurship in businesses. This study addresses the management dilemma that exists (particularly in South Africa) as how to foster and implement corporate entrepreneurship in businesses to sustain this competitive advantage and improve performance. Ireland, Kuratko and Morris (2006) developed a corporate entrepreneurship health audit instrument to assess corporate entrepreneurship and innovation in a business. The purpose of this study is to make use of this health audit instrument to assess the corporate entrepreneurial and innovative levels in the South African short-term insurance industry. The empirical evidence indicated that significant statistical differences exist between the employees in the short-term insurance industry in terms of various aspects of the degree and frequency of entrepreneurship, and various corporate entrepreneurial climate factors (management support, work discretion, time availability and organisational boundaries). The results of two self-administered questionnaires revealed that gaps exist in the businesses in terms of the various business units as well as the management levels. A corporate entrepreneurial development programme can be developed to address these gaps. The study proved that an international instrument can be applied in a South African context. Because this was the first formal study being done in the field of corporate entrepreneurship in the South African short-term insurance industry, it can serve as a benchmark for individual short-term insurance businesses.