Educating Professional Entrepreneurs for the 21st Century: 2007 NAME Lecture by Thomas A. Bryant, Ph.D.

1. Educating
Professional Entrepreneurs
for the 21st Century:
The Academy of Management, Management Education
Division Exchange Presentation for 2007
Thomas A. Bryant, Ph.D.
Rohrer Endowed Chair in Entrepreneurial Studies
Rowan University, USA
@ the Nippon Academy of Management Education,
Takamatsu; 23 November 2007

2. Agenda
 Define the standards
 Identify the state of the art
 Discuss the leading edges of the field
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3. Why Study Entrepreneurship?
 Social value of the economy:
 Goods and services
 Innovators create new goods and services
 Entrepreneurs test and prove their market
potential
 Big companies consolidate and distribute
efficiently (MANAGEMENT?)
 Corporate innovation / entrepreneurship
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4. Social Value 2
 Jobs
 Meaningful work
 Wages => exchange value (cash to buy things)
 Who creates the new jobs?
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5. David Birch (MIT), 1979
 US Economy: 16 million new jobs
 Fortune 1000 Companies:
 No change in the number of jobs
 Government / public sector
 Minor growth
 Small business
 Not much change
 “Gazelles” (3% of firms)
 Fast growing, job creators -- Led by entrepreneurs
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6. Edward Lowe Foundation, 2007
 Job creation effects, 2003-2006, Philadelphia MSA
Category Stages Ownership Job Creation % of Net New
Jobs
Firms 1-9 1: Startup Local +105,000 +43%
Firms 10-99 2: Growth Local +110,000 +45%
Firms 100-999 3 & 4: mid- Local? +10,000 +5%
sized
Non-profit / Local? +15,000 +7%
Public
Gains +236,000
Firms > 999 5: Consolidation Not local? -210,000 -93%
Losses -210,000
Cumulative +26,000 +7%
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7. ENTR Ed vs. SBM
 Small Business Management (=SBM)
 Older field
 Focused on excellence in non-growth firms
 Efficiency
 Entrepreneurship Education (= ENTR Ed)
 Focused on Creating and guiding GROWTH
 Creativity
 New Ventures
 Innovation management
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8. ENTR Ed in Business Schools:
Standard: Same as Accounting, Marketing,
Finance, MIS, Engineering, or Education
 Competence in the  Undergraduates:
accepted knowledge and Ready to earn a decent
current practices living as an entry-level
 Ready to start work, professional in the field
begin career, advance  MBAs:
toward senior levels of Ready to earn a good
occupation living as an mid-level
professional in the field
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9. What Do Professional
Entrepreneurs Do?
 MUST focus on successful practitioners
 NOT the average, or the poor performers
 Entrepreneurship defined by:
 Creating new organizations (for-profit, and social)
 Growing at well-above-average rates
 Recycling economic resources to higher value uses
 Who are the model performers?
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10. Professional Entrepreneurs
 Start new ventures --  Add value at above-
and sell them for a average rates
profit  Create incremental
 Start new ventures -- value (1+1>2)
and keep them growing
for a full career  Innovate
 Take over static or  Seize opportunities
declining ventures and  Reject bad deals
turn them back into
growth engines
 Cut their losses early
 Accumulate wealth
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11. Entrepreneurs Get Paid
 As managers -- salary
 As entrepreneurs -- for growth in equity
 As investors -- for returns on invested capital
 Daily -- in challenge and excitement
 Monthly -- salary / owner’s draw
 Exit -- change in equity value
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12. Emergence of ENTR Ed
 A few courses on Small Business Management
 David Birch, 1979: Gazelles create jobs
 Drive to uncover latent entrepreneurs
 Public support for entrepreneurs and ENTR Ed
 Focus on Start-ups
 High value-added startups: Technology?
 Corporate entrepreneurship: the growth layer
 Family business: mix of growth and SB Management
 Edward Lowe Foundation, 2007: “Second stage”
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13. Can Entrepreneurship Be
Taught? Learned?
 Many ways!
 Hard knocks (original)
 Observation of practice / informal apprenticeship
(old-fashioned)
 Research-based pedagogy (modern)
 Fastest growing field in Academy of Management for
nearly a decade
 Over 4000 member in ENT Division now
 Over 50% of US colleges and universities
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14. Tracks within ENTR Ed
 Lead Entrepreneurs (15%)
 Entrepreneurial support providers (25%)
 Family business inheritors (30%)
 Corporate innovation managers (30%)
 Small business experts (?)
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15. The Domain: What Skills Do
ENTR Students Learn?
 Opportunity generation /creativity
 Feasibility assessment
 Planning new ventures
 New venture implementation
 Growth
 Harvest / exit
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16. The Startup Courses
 Creativity (brainstorming, etc.)
 Opportunity scanning and selection
 Feasibility analyses
 New Business Plans
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17. Corporate ENTR Ed
 Managing growth (organic)
 Deal-making
 Mergers and acquisitions
 Divestitures
 Abandonments
 Intellectual property
 Valuation
 Innovation management
 New Products
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18. Managing Growth
 Only 1 of 14 ENTR courses at Rowan
 Edward Lowe Foundation data: 45% of USA
net job creation occurs among firms with 10-
99 employees, $1Million-$100Million
 TAB’s Growth course at Rowan:
 Buy a business ($100K - $250K, with leverage):
 What is worth buying? What is not?
 Add value: grow it (by adding what?)
 Exit and harvest added value
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19. Specialty Courses
 Franchising Sectors
 New venture finance  Retail
 Corporate innovation  Tourism
management  Fashion
 Excellence in Small  Food
Business Management  Agriculture
 Family Business  Manufacturing
 Technology
 Social / not-for-profit
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20. Can ENTR Ed Fit into Business Ed?
 Karl Vesper (U Washington): No, need separate schools
(Coleman keynote at USASBE ….)
 Bruce (UND): $50 million School of ENTR
 More than half of US schools now trying anyway
 Many international programs
 Faculty converted from
 Practitioners (personal evidence, learning, stories)
 Strategy, Marketing, Engineering, etc. (Textbooks, research evidence?)
 Emerging faculty with PhDs in ENTR: (Louisville, Boulder,
MIT, Indiana, UMKC, others)
 Does it make a difference?
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21. Where Does ENTR Fit?
 Creative destruction (Schumpeter, Branson)
 Innovation: creation and management (Tidd)
 Insights into the bleeding edge of management
(Ducker)
 Critical importance of dynamic orgs,
(Christensen)
 Intelligence (Romer)
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22. Across functional disciplines
 Accounting: Tax strategies; Cash flow
forecasts
 Strategy: Creation, change, M&A,
 Marketing: New product / New venture
assessments, launches
 Finance: Valuation, re-assignment of assets,
asset classes
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23. Methods of Teaching / Learning
 Lecture / study
 Practice
 Theory & Practice
 Different Learning Styles (e.g., Learning
Concept Inventory; Tom Hawk paper)
 Learning Motivations
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24. Motivations to Learn
 Each student needs at least one thing that pulls
him / her into the material
 With that “velcro,” students then study the rest
of the material
 How do we learn?
 How many kinds of hooks?
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25. Learning Velcro:
Conceptual Thinking
 Written word  Simulations
 Spoken word  Practice reality
 Displayed word, e.g.,  Pictures
PPT  Video
 Cases  Music
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26. Story-Telling Experiences &
Empirically Based Research
 Story-telling  Empirical literature
 Direct contact  Broad patterns
 Students enjoy  Extrapolate
 Like case method  Not enough detail to
 Hard to extrapolate to determine valid
new situations, different exceptions
people.  May limit creativity
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27. Theory & Practice
 Courses  Experiential learning
 Textbooks  From experts
 Structured learning  From personal
 Best practices experience
 Testable, in common  PBL = Project-Based
 Relative expertise Learning
 Body of knowledge  Adapted to individual
 Modeled on successful  Personal meaning
practitioners
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28. Internships in Japan, AY2006
 Kyodo News, reported in The Daily Yomiuri:
21 November, 2007, p. 2: Education, Science
and Technology Ministry (Japan)
 50,430 internships from 482 Japanese
universities in AY 2006
 66% of universities, up 35% over AY 2005
 8,000 more internships than AY 2005
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29. Experiential Learning in ENTR
 Internships: Projects within the ENTR Center
(freshmen?)
 Apprenticeships: Assistant to the Entrepreneur
 Junior Partners: Sweat equity, with Senior Partner
 Employee
 Manager
 Partner
 Owner: Select, plan, launch, operate, exit
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30. On-Campus Ventures: 30-60?
 What campus-related ventures could ENTR students
own and operate?
 Brain-storming session: 3-4 >> 30-65!!
 Freshmen: work in several
 Sophomores: buy in
 Juniors: manage
 Seniors: own and exit
 Putting them through college by virtue of ENTR
experience: Will parents buy in?
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31. Impacts of University ENTR
Programs
 Presence on campus: attitudes, legends, stories
 May affect learning models, expected outcomes
 Indirect: friend, colleague
 Once over lightly: one workshop or course:
 creating potential for lifelong learning
 Minors and Certificates: skills, attitudes
 Majors, Specialists: careers, professionals
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32. Conclusions
 Still a very young field: much left to learn
 Vitally important domain: creating value, and
managing its growth.
 Focus on core outcomes: successful venture
development, value-added, change
management
 Professional standards: best practices,
measurable outcomes, transferable knowledge.
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