Make Entrepreneurship a Business School Priority
Those exploiters of opportunities, as John Naisbitt pointed out in his book Mind Set!, are entrepreneurs. Forget your Norman Rockwellian vision of the entrepreneur as the quaint small business owner. Today's successful entrepreneurs are those with the skills to identify an opportunity, formulate a business that unlocks the value in that opportunity, and ultimately identify and align the resources necessary to drive growth.
But desiring these skills is very different than possessing them. An entrepreneurship-specific curriculum in business school is essential for today's entrepreneurs to create value—for their companies, their customers, and their stakeholders—whether they are building their own companies or playing a leadership role in an established organization.
Opportunities abound today for entrepreneurs. Some may have other descriptors for the frightening change that swept through the economy a year ago, but the root forces of that change have been upon us for awhile. In Creative Destruction, Richard Foster and Sara Kaplan showed that the average company tenure on the Standard & Poor's 500-stock index has been in decline for some time and continues to drop. The idealized large, stable firm is in retreat. Those firms that continue to prosper do so by constantly reinventing themselves and their product lines.
creating wealth from innovations Differentiated products drive corporate growth, and in a globally competitive world those products become commodities at increasingly accelerating rates. This is why companies need to continually innovate—or get run over by someone else. This is also why businesses of all sizes need entrepreneurs. As the management guru Peter Drucker said, "entrepreneurs innovate." More importantly, they know how to create wealth from those innovations. Businesses of every size need leaders who have this skillset in order to survive and prosper.
Where are these entrepreneurial leaders coming from? Many are honing their skills by working with high-growth startups. While those who take this path do develop all the necessary skills, from opportunity identification to growth, they are particularly adept at finding outside investors. This skill, while critical for a startup, is much less so for a corporate entrepreneur. On the other hand, skillfully managing the landscape of people and policies within a large firm is essential to the entrepreneur navigating in a corporate environment. For big companies in need of entrepreneurs, relying on those who started their own businesses isn't really a solution: They simply don't have the right skills.
That's where business schools come in. Business schools can and must step up and create the kind of entrepreneurs so badly needed in organizations of all sizes. An emphasis on entrepreneurship would help MBA students understand how to identify opportunities and create value in any economy. It should start by defining entrepreneurship in a way that communicates its relevance to corporate recruiters.
curricula changes needed We do ourselves a disservice by defining entrepreneurs by the size of the organization they work for or by that firm's growth potential. Defining entrepreneurs in this way is unnecessarily limiting and must be changed. Size or growth potential should not be the criteria for an entrepreneurial venture. Some companies, as the author Bo Burlingham taught us, choose to be great instead of big. Some even choose to be nonprofit. What they all have in common is that the leaders driving these organizations have the skills to identify an opportunity and create an organization to pursue it through the creation of value for themselves, their customers, and their stakeholders. It is this skillset that defines the entrepreneur, not the organization to which they apply those skills.
Beyond redefining what it means to be an entrepreneur, business schools must alter their curricula in order to produce entrepreneurial leaders. In addition to having stand-alone courses, the entrepreneurial mindset needs to extend into existing disciplines within the business school. The addition of experiential programs allows students to transform their classroom knowledge into real-world skills.
Early indications are that business schools can indeed produce these more broadly-defined entrepreneurs. A recent survey of MBAs at the University of Michigan Ross School of Business (Ross Full-Time MBA Profile) who graduated over the last decade indicated that among those who self-identified as entrepreneurs, 45% were successfully applying their skills in corporate settings, 42% at startups, and 13% in the financial arena. Surveys by Harvard Business School (Harvard Full-Time MBA Profile) and Northwestern's Kellogg School of Management (Kellogg Full-Time MBA Profile) showed similar results.
Leaders are needed across the complex innovation value system. Curriculum changes and the addition of experiential learning programs have shown the potential that business schools have in developing the next generation of entrepreneurial leaders. The need is great and growing. The time for debate has passed; the time to act is now.