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Identifying Intrapreneurship Opportunities – Kaplan Case Study

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Intrapreneurship, entrepreneurial behaviour within the boundaries of a larger company, is a concept helping to make some big changes within big businesses. At Kaplan, this concept has been embraced in the form of our Leadership and Professional Development programmes. Below is a case study which highlights Kaplan’s dedication to the intrapreneurial spirit and how it is being successfully applied within the wider business.

Kaplan Inc. is a wholly-owned subsidiary of Grahams Holding Company, and with revenues of around $2 billion, represents the majority of the Grahams Holding Company’s assets. Kaplan is focused on the education sector, offering services from K12 through to professional education.

With the education sector increasingly challenged by new technologies, EdTech, and much of the core content being commoditised, the Kaplan Leadership team were aware that they needed to capture some more high-touch, experiential education services to both diversify and protect the business. To this end, they identified the corporate leadership and professional development sector as an area where opportunity was to be found, and looked to the business’s UK activities, where there was already a strong brand in professional finance assessment and education in existence.

Andy Perkins was brought in to start the new Kaplan Leadership and Professional Development Services division of Kaplan Financial in early 2015. Perkins had led the company’s Kaplan Financial Markets business until 2005, when he left to become Commercial Director of a bespoke leadership development consultancy. Thus in 2015 he found himself returning to a company he knew well, but with almost a decade of outside experience to bring back with him.

Perkins sees his role at Kaplan LPDS as one of the intrapreneur. The new business needs to be built quickly, but also be radically different from the existing one. A large part of the challenge is in positioning the new business brand at a higher executive level than the Kaplan Financial business in the UK, and certainly in a different place to the K12 perceptions in the US. So Perkins is required to quickly upscale a new business to a new audience, whilst establishing new brand credibility with his target market – no small task. He acknowledges that to do this takes a certain degree of ‘brass neck’. That is to say having the confidence and self-belief that he, and the team he is building, can achieve these audacious milestones, but also that in striving to do so many traditional Kaplan processes and mindsets will have to be challenged or simply over-ridden.

As a consultant, he explains the very different needs and requirements of businesses in their early, risky, fast-growth mode compared to those in more stable, mature phases. Inevitably the mindsets required to grow the former with energy and agility are not the same as the more process-driven and revenue protecting approaches required to manage the latter. It is this tension between the two ventures that Perkins sees as the critical point that differentiates intrapreneurs from entrepreneurs.

Entrepreneurs are expected to be risk-takers and mavericks, and today are primarily funded by sophisticated angels, venture capital or private equity experts who understand the essential risk of these kinds of investment – and are sufficiently diversified across a number of investments to be able to absorb failure. Internal start-ups rarely have that luxury, (though the growth of corporate venturing is changing this) and the initiators and backers of new ‘intrapreneurial’ businesses often view the venture as an all-or-nothing game, where individual reputations, and sometimes the very existence of the parent company, are closely tied to the new business’s success.

As such, Perkins sees the role of the intrapreneur as being someone who not only can drive the business quickly and innovatively, creating energy and passion across a small but fast-growing team, it is also someone who is able to ‘manage up’ to the expectations, and often conflicting demands, of the parent Board. ‘Conflicting’ because they want the business to be exciting, take risks and challenge norms, but are often unwilling to see existing cultures traduced, or governance and reporting processes over-ridden. The intrapreneur therefore needs to manage these relationships, and have a political antenna that knows when to build bridges and soothe concerns.

“The ability to communicate with the senior team, in the right language, to put things across in the right way, is a fundamental competence the intrapreneur requires” Perkins says. “Above all it is about having trust from the top”. Perkins likens containing a start-up in your mature organization as being akin to “bringing up someone else’s teenager”. It is necessary for that teenager to earn its foster parents’ trust so it can do the things teenagers need to do to become successful adults - break some rules, experiment with different behaviours – but ultimately realise that their long-term success is also connected to the ‘family’ brand and traditions too.

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