Classroom challenge

Classroom challenge

Is entrepreneurship an innate skill or can it be taught? A growing number of universities are banking on the latter.

There is no shortage of entrepreneurship in entrepreneurship education. Twenty-one Australian universities offer entrepreneurship specialisations and more are introducing undergraduate degrees on the topic. Growth has been stunning for an academic discipline that barely existed 15 years ago. Yet there is little evidence that entrepreneurship education works and even less debate on when, where or how it should be taught. There are also doubts as to whether universities can offer so many new programs, given Australia has relatively few academics with entrepreneurship research backgrounds, few active researchers in the field and a shallow pool of research on which to draw.

There is simply not enough quality entrepreneurship research and teaching in Australia to meet demand. As a result, many universities are relying heavily on part-time teachers who are seen as cost-effective but may not be abreast of the latest theory. Or they are using academics who do not have PhDs in entrepreneurship to teach a subject that is more dangerous than most if instructed poorly.

Another fear is that some universities are cobbling together entrepreneurship degrees using too many subjects from other business programs and teaching them in the same style as traditional MBA programs, even though entrepreneurship students usually have different academic backgrounds and mindsets, and need different styles of learning. And there are concerns that teaching entrepreneurship at undergraduate level could be dangerous if students are not ready for it.

The debate between specialist academics and part-time teachers with a lack of research is not unique to the field of entrepreneurship. Nor is the solution: extra funding. But entrepreneurship schools may never get the same level of funding and support from big business as MBA programs. As the battlefield moves from big business versus big business to big business versus new business, entrepreneurship schools are (or should be) on the side of insurgent companies rather than incumbents. Corporations want more innovation and entrepreneurship, but will many ever pay for their top executives to attend programs that, at their core, encourage students to start their own enterprises?

Another problem is that the obvious source of funding - wealthy entrepreneurs - can be hard to access because many place little stock in formal entrepreneurship education. Although a few support new-venture education, there is no Australian institution even remotely similar to the well-regarded Kauffman Foundation in the United States, which researches and promotes entrepreneurship. Then there are the academics. Those with genuine research backgrounds in entrepreneurship, new-venture experience and an engaging style are rare. Too few are willing to work for modest six-figure academic salaries when they can earn a multiple of their salary in the US or start an enterprise.

The debate over the standard of entrepreneurship education is important - the community benefits of stronger participation and success rates in small business are undeniable. And it is timely due to the influx of generation Y students who are more interested than previous generations in creating a job than finding one.

Their propensity to live longer at home is helping them take more risks and overcome a strong impediment to entrepreneurship: fear of failure. At the same time, the fragmentation of corporations is creating opportunities for nimble entrepreneurs who can disrupt markets and create niches.

More practically, booming stock and property markets over the past decade have increased wealth and made it easier for some to take career and financial risks to start a venture. Others are just sick of the work-life pressures that come with senior jobs in big companies and crave an entrepreneurial lifestyle.

For all the debate, no one really understands the effectiveness of entrepreneurship education in Australia , the dean of the Murdoch Business School in Perth, Professor Michael Schaper, says. "There has been no major study in this country that tests the assumption that entrepreneurship education actually works. This is surprising, given entrepreneurship is becoming a much bigger part of the business school landscape and that there is so much more interest in it and so many more people studying it."

Schaper says top entrepreneurship courses provide "nuts and bolts skills" but infuse teaching with theory and broader perspective. "It's the traditional challenge business schools have: are they trying to be academic institutions, pure teaching institutions, or strike a happy compromise? This is an issue for all disciplines but one that is particularly pronounced in entrepreneurship. I am not sure many schools have the balance right so far."

Global entrepreneurship researcher Professor Kevin Hindle believes the standard of entrepreneurship teaching in Australia is mixed. "Nearly all entrepreneurship teachers in this country are not formally qualified to teach it [with a PhD in the discipline]," he says. "Really good entrepreneurship education that is challenging, modern, research-based and vocationally useful is not going to come exclusively from universities.

"Entrepreneurship is such an important social phenomenon that universities ought to be researching it more and challenging students to think about it, not just picking up a few random vocational skills. Instead, we have too many part-time instructors who teach students to write a business plan based on a template in chapter five of some outdated American textbook."

Here's the problem: entrepreneurship students require a mix of vocational skills, such as accounting and law, as well as knowledge that encourages them to think differently and more critically, something Hindle calls "vocational transcendence". But Hindle believes entrepreneurship schools focus too much on vocational skills, in part because they do not have enough academics with entrepreneurship research backgrounds and also because skills-based courses have more commercial appeal to students who are thought to be bored by theory.

Too many entrepreneurship courses are, in effect, commoditising themselves and downgrading their standing, Hindle says. "There is nothing wrong with skills-based courses - and of course there are certain vocational subjects you have to teach in any business course. But universities are usually very poor at this style of teaching. If you only want nuts-and-bolts skills in entrepreneurship, a university is the last place you should attend. You can end up having this situation of part-time teachers teaching entrepreneurship who don't always understand theory, and full-time academics who aren't always great at teaching pure vocational skills. You can end up with the worst of both worlds."

Hindle is sceptical about the value of specialised undergraduate degrees in entrepreneurship even though his employer, Swinburne University of Technology, is introducing such a program in 2009. "A very dangerous time and place to learn entrepreneurship can be at an undergraduate level," he says. "Bringing young people in who have no experience in business, giving them stars in their eyes, and telling them they are equipped for the great challenge of entrepreneurship can be quite dangerous. I am not saying some entrepreneurship subjects should not feature more heavily in broader undergraduate business courses, but a total focus on entrepreneurship can do more harm than good."

The counter argument is that more entrepreneurship courses will expose more students to the field and over time encourage a new generation of academics and more specialised research. More students should, in theory, mean more revenue and greater resources for teaching and research. But many universities treat their business schools as cash cows to help fund research in other disciplines.

"I believe universities, if staffed by a blend of specialised researchers and inspiring teachers who have a passion and respect for the discipline, can provide entrepreneurship education at a masters level to students who have business experience and want to learn more than just vocational skills," Hindle says. "But we need to recognise it is an incredibly difficult subject to teach well. It is not a topic that anybody with a standard business qualification, or any university with a business school, can teach."

Life Be In It International executive director Colin Benjamin says business schools are not always clear on the type of entrepreneurship they are teaching and need to improve their curricula.

"I firmly believe entrepreneurship can be taught and that there are some good schools in Australia teaching it," says Benjamin, who has a Doctor of Business Administration in entrepreneurship theory. "But the starting point has to be to define what type of entrepreneurship you are teaching: opportunity entrepreneurship, necessity entrepreneurship or the transfer of particular skills or competence. Then you have to offer well-rounded courses that teach people entrepreneurial skills as well as provide space to challenge their assumptions and get them thinking differently. This is hard to do well."

RMIT University director of research in marketing, Professor Kosmas Smyrnios, says the key to entrepreneurship education is experiential learning. RMIT's program, a leader in practical education, encourages students to work on projects with business. "We're of the view that we need to help students experience entrepreneurship. You can't just learn about this in textbooks and the classroom," he says.

Perhaps the biggest problem in entrepreneurship education is simply time. The discipline has come an exceptionally long way in a short time by making the most of scarce resources - not unlike the many start-up ventures it instructs. Now, with a strong and growing footprint in business education, it needs to innovate and reinvent its own business model, sometimes in the face of stifling university bureaucracies, to sustain growth. Most of all, it needs to show students it can practise what it teaches.

A platform for education

Much has been made of the question: can entrepreneurship be taught? But more important questions are: when, where and how should it be taught? There is no simple answer to the first question. No one can teach someone to be an entrepreneur, although it is possible to learn about entrepreneurship or at least parts of it. The same argument applies to any discipline. Accounting students need a natural interest in numbers, just as entrepreneurship students need an aptitude for risk-taking to start ventures. Good teachers might cultivate an entrepreneurial spark in their students, but one has it or one does not.

On the "when" question, students are exposed to entrepreneurship teaching too late. Lauren Rielly had a natural inclination for business at an early age yet, like most, studied the discipline only at a postgraduate level. Had she learned more about entrepreneurship at high school, even primary school, she may have increased her odds of success. Clearly, there is a strong case for more schools to introduce genuine entrepreneurship subjects (not just accounting or economics) to help students starting their own ventures or provide a better grounding for those studying entrepreneurship at university at an undergraduate level.

To suggest universities are the only place that can provide a deep knowledge of entrepreneurship is folly. It may be that business schools should not be the guardians of entrepreneurship education but instead more aggressively imbed their programs into other disciplines so that at least one entrepreneurship subject is offered in everything from astronomy to zoology. There is also a case that entrepreneurship should be taught more prominently in commercial colleges that tend to focus on small business. And there is an argument for more on-the-job learning based on an apprenticeship model - something Professor Kevin Hindle of Swinburne University of Technology makes a case for in his paper, Teaching Entrepreneurship at University: From the Wrong Building to the Right Philosophy.

How entrepreneurship should be taught is also problematic. It needs academics who have strong research backgrounds to impart theory; "pracademics" who offer real-life experience in an academic context; practitioners who teach basic vocational business skills; input from entrepreneurs for "war" stories on success and failure; and educators who help entrepreneurs develop greater self-awareness, and motivate them. But most of all it needs good teachers and researchers.

The point is: entrepreneurship needs to be taught in many places, in many ways, and through many different styles of teaching. There is no single solution. Universities are trying to provide one but it is unreasonable to suggest any can provide the type of rounded learning environment entrepreneurs need. If politicians are serious about creating a more enterprising economy they could start with creating a more robust and better-funded platform for entrepreneurship education that inspires a new generation of business owners and develops research that guides policy.


School of hard knocks

Lauren Rielly was close to becoming a millionaire in her 20s when she started a master's degree in entrepreneurship. Eighteen months later, she could not afford the $100 graduation fee.

Rielly's venture, Global Contact Solutions, collapsed in 2006, even though the database marketing company had sales of almost $1 million and a larger company eager to buy it. But the deal fell through, leaving her with hefty accounting and legal bills and a neglected business due to a drawn-out sale process. When GCS went into voluntary administration in 2007, the company owed creditors $200,000.

Devastated by failure, Rielly was admitted to hospital for stress-related illness and later required emergency treatment for a breakdown that her psychiatrist diagnosed as post-traumatic stress disorder.

A split from her partner ensured Rielly, 28, had more traumas in a few weeks than many have in a lifetime.

Relying on money and support from friends to survive, Rielly quickly started two more businesses. Both had problems. She also ran unsuccessfully in a council byelection in Melbourne this year.

Now she is teaching entrepreneurship in an undergraduate business program at Swinburne University of Technology and plans to start a business mentoring young entrepreneurs. She is passionate about raising awareness of mental health issues among small business owners, who she believes are more prone to depression, given the highs and lows of business.

Rielly's willingness to talk openly about her experience is rare in a culture that still shuns failed business owners, despite failure often providing more insight than success.

Rielly has firm views about how entrepreneurship should be taught. "You need a mix of skills-based training, traditional university learning, experiential learning and even psychology and motivation," she says. "The course should be about helping students to find or cultivate their spark and passion. And the teaching should reinforce to students that entrepreneurship is a lifestyle, not a job, and that it is a high-risk endeavour. I thought I was invincible when I started out in business but am much more conservative now."

Rielly could easily perpetuate the myth that entrepreneurs are born. At the age of eight, she was making $30 on some days selling pressed four-leaf clovers and at 11 tried to patent a reflective cat collar.

Growing up in a housing-commission flat, Rielly met her father - a successful inventor - for the first time in her early 20s. At 22, she started GCS and before long had six staff, partner offices in Asia and a licence to sell a promising geodemographic analytics technology. When a big company came knocking, Rielly was eager to sell and move on to her next creative venture.

The due diligence, slated to take six weeks, kept being delayed. Rielly was great at relationships, sales and the vision - but detail came last. Her company's accounts were in modest shape, documentation was poor and she was living beyond her means.

"I got out of hospital and went straight to our fifth birthday party where I had to put on this brave face in front of clients and staff even though I was going to lose my company," Rielly says. "But the hardest thing was retrenching my most loyal employee. Nobody can teach you how to do that."

Rielly is philosophical about her failure. "Looking back, the biggest mistake I made was not understanding myself. I learnt this the hard way, and through my master's degree, which was a great experience. I'd like to think I failed with dignity and integrity, and I know I have the entrepreneurial capacity to build a successful fast-growth venture again.

"An ability to deal with failure is a key part of being a serial entrepreneur. It should be embraced."

The author completed a master of entrepreneurship and innovation at Swinburne University this year.

© Fairfax Business Media

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