An entrepreneur needs broad-based education
Photo by Minnesota Historical Society
Overcoming the global economic crises depends among many factors also on the number of entrepreneurs, who could adjust to the forthcoming changes. Probably many existing businesses will die during this or the next year. It creates an opportunity for new companies to replace the old ones on the market. The last one hundred years has mostly been the century of the employees as the share of the entrepreneurs in the population has been lower than during the previous centuries. A couple of hundred years ago all the handicraftsmen and farmers were entrepreneurs. Now the situation could change, but the growth of the entrepreneurship activity depends to a great extent on the career choices of young people. The central issue is how many university graduates are going to start their own businesses. But they need relevant education for being successful in it.
Most of the entrepreneurs are not persons, who have deep specific knowledge in a particular field. In the majority of cases they have broad-based education. Dealing with business, especially with small business requires skills and knowledge from different fields, as the have to face many different tasks. The opposite case is the specialists, who are employed in big companies, as they can concentrate on specialisation to a narrower field and enhancing a limited number of skills. Although entrepreneurs can and have to employ specialists, they still need diverse knowledge for recruiting specialists, giving them appropriate tasks and evaluating their performance.
Recently there was made a survey among the graduates of the Business School of Stanford University, which investigated how the study results and choices in curricula affect the probability of starting an own business after graduation. The results of the analysis gave support to the hypothesis, that balanced set of skills increases the chances of being an entrepreneur.
First, the probability of starting business was higher for those graduates, whose grades were more evenly distributed among different courses. Those, who got very high grades in some subjects and low grade in other subjects, were likely to become an employee.
Second, the future entrepreneurs were more likely to choose courses over a broader spectrum of fields. They did not choose classes only from one field like management or marketing, but the studies include various courses in all fields of economics.
Third, those who started businesses, worked during their studies on many different jobs. More precisely, it was not the number of different jobs, but number of different tasks they had to perform on those jobs, which affected their future career decisions. Performing many different tasks, the future entrepreneurs, acquired a diverse set of skills and knowledge, which were beneficial for starting their own business.
It can be concluded upon these results that more broad-based education is necessary for promoting entrepreneurial activity. That kind of education gives the graduates an ability to see the potential needs of the customers and spot the business opportunities. Therefore it is not so good if university students, and especially those who study business or economics, specialise too early, as it decreases their possibilities to becoming an entrepreneur. The specialisation may come later, for example at the master level and the broad-based undergraduate education does not prevent specialising later to a narrower field.
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My name is Kristjan-Olari Leping. I am a speed reading trainer. I have an associated professor position at the University of Tartu, am a policy analyst in a policy research center, I am a trainer and I am involved in many other business projects. 