Entrepreneurship and the role of Higher Education Institutions

By

Kashif Mateen Ansari

Entrepreneurship education has attained a new importance in the 21st century on account of various factors. The youth of this modern information age wants to think outside the box and to identify and pursue opportunities in totally new and innovative ways. The founder of Grameen Bank of Bangladesh and Nobel laureate Muhammad Yonis said, “My greatest challenge has been to change the mindset of people. We see things the way our mindset instructed our eyes to see.”

In today’s world, social change can be brought about by the entrepreneurship. The great management guru Peter Drucker said, “What we need is an entrepreneurial society in which innovation and entrepreneurship are normal, steady and continual.”  A lot of studies have been conducted in the last few decades which clearly underline the need for the modern education’s requirement to develop entrepreneurship and entrepreneurial mindset in the youth so that they can act as a catalyst of change in the social and the economic sector.

What is entrepreneurship? Entrepreneurship can be defined in a number of ways. A crisp one that I found reads as “the pursuit of opportunity beyond the resources you currently control.” This definition is attributed to Stevenson and Jarillo. Another definition that I came across:  “Entrepreneurship refers to an individual’s ability to turn ideas into action. It includes creativity, innovation and taking calculated risk, as well as the ability to plan and manage projects in order to achieve objectives. This supports everyone in day-to-day life at home and in society; makes employees more aware of the context of their work and better able to seize opportunities, and provides a foundation for entrepreneurs establishing a social or commercial activity.” (European Commission, 2008) In simple words entrepreneurship is a process that results in creativity, growth and innovation. Entrepreneurship takes various forms and its benefits are not limited to starting up of new businesses or creating new jobs but it leads to overall development in the fields of science, art and culture.

According to a report on entrepreneurship by Kaufman Foundation it was found in a number of studies that 25% of kindergarten level children manifest the characteristics of initiators (we will describe initiators later) But the study found out that for the same kindergarten level children who showed this trait, regrettably when they graduated from high school the percentage had dropped to 3% of the students. “Initiator “is the basic form of an entrepreneur, who has the ability to identify good market opportunities and possesses the required skills and the passion to lead the effort to follow those opportunities and take risk. In other words initiators are the kind of person who is ready to take risks and go into action. The study mentioned above puts forward the great dilemma of today’s education system that instead of creating the spirit of taking action and creating new things, the education systems, even in the developed countries, are stifling the creativity of the young mind.

The modern emphasis on Entrepreneurial education has many proponents but the seminal work of Schumacher “Small Is Beautiful” has made a lot of impact. Schumacher was mentored by John Maynard Keynes. Schumacher recognized that unemployment and poverty had scourged the world and raised his voice against the focus on large-scale projects and organizations.  According to him, individuals mattered. He propounded that with proper training, education and support, individuals can become self-employment and active members of the economy.

Further support to this phenomenon was provided by the British Prime Minister Margaret Thatcher who favored private enterprise and preferred individual responsibility. This was further supported by Ronald Reagan in the US with his focus on privatization and entrepreneurial frame work of private enterprise. Demise of larger enterprise due to oil prices and economic crises also helped the situation.

The emphasis on entrepreneurial education led to a lot of work on what constitutes the main frame for this activity. So there came out a list of fundamentals required to be understood by the potential entrepreneurs. Important amongst these included;

·         Understanding the pleasure of business,

·         A desire to serve others, of wealth creation and ownership.

·         Market opportunity recognition and research,

·         Empathy ,  

·         Comparative advantage.

·         Laws of supply and demand.

·         Marginal utility (“economics of one unit”).

·         Return on investment and break-even calculation.

·         Compound interest

If we get back to the Guru, Peter Drucker, he said: “Entrepreneurship is not magic, it’s not mysterious and it has nothing to do with the genes. It’s a discipline and like a discipline, it can be learnt”. If we cross this major hurdle of mindset and move forward, that entrepreneurship can be taught then the universities themselves can become entrepreneurial centers.

Entrepreneurship cannot be exercised in vacuum. Our higher educational institutions have to understand that the young people have a desire to do something and do something new. They have a desire to create something good and they have an innate longing to give back to the society. So the higher education institutions have to encourage and foster such attributes which can help the young people do the same. Entrepreneurship can be supported and helped in the most effective way by the education system at the higher level.

We have to create an Eco- system whereby various education institutions and the government have to come together to help support the entrepreneurs. Obviously that Eco- system will be incomplete till the time the businesses don’t partner with the higher education institutions and the government. The higher education institutions have to come up with new and innovative ways of imparting education which is conducive for generating an entrepreneurial mindset.  It has been found that just by adding courses on entrepreneurship alone does not help the young minds to transform into entrepreneurs. Globally this has been found out that where the curriculums are broad base or students are allowed to come together into teams drawn from various disciplines of knowledge; like business, marketing, engineering, technology and social sciences, the cross learning which occurs across all these various disciplines help the students become entrepreneurs.

Our universities have to look more into creating multi-disciplinary approach towards entrepreneurship which can be best achieved by creating centers of entrepreneurship having no particular course or curriculum of their own rather having a collection of multi-disciplinary courses and multi-disciplinary education which can be brought together in the form of various teams working on various technical, social or business projects. Then the universities have to be supported by the government in the form of small seed capital which can be assigned to such teams. The businesses must join hands in helping the young entrepreneurs to put their ideas to practice in the real business world. The ideas selected should be the ones that have been tested in the incubatory environments of the universities’ entrepreneur centres. This will be a win-win situation whereby businesses will get a new injection of ideas and fresh blood, and the young entrepreneurs will find a ready market for their newly developed ideas.

The universities can play an important role by overcoming the myth that new business formation or entrepreneurship is only the domain of a select few who either come from rich backgrounds or from families that are already well-known for establishing new businesses. There is no such evidence which links entrepreneurship with the genes. However, there can be a lot which can be found in the research studies linking entrepreneurship and education.

We may quote five core elements identified by Bortum clerk in his book “Creating Entrepreneurial Universities, Organizational pathways of transformation”. The core elements which he indicated were:

1.      A clear vision and mission

2.      Good structures and mechanisms to interact with the outside world

3.      Diversified funding base

4.      Inter and multi-disciplinary activities

5.      An integrated entrepreneurial culture

If we look around in the international arena, many universities will come out as great examples of entrepreneur centers which are furthering entrepreneurship. In the list of such universities, Stanford University ranks really high, which is generating patents for almost 80% of the amount of funding spent on their research. That is a great example of entrepreneurial activity. Across the world governments are helping big universities with their initiatives to stimulate links between businesses and universities. An example rams

There are many approaches which can be taken by our universities to include entrepreneurship as a form of mainstream learning. These approaches can be that:

1.      They can develop leadership skills

2.      They can embed entrepreneurship in general education

3.      As discussed earlier, they can take a cross-disciplinary approach

4.      They can leverage the availability of technology in the form of the technological advances in general and in the information technology in particular.

In Pakistan we can bring about a great change through the universities by creating a high number of entrepreneurs who, instead of becoming job-seekers will become job-makers and the few factors which can help this initiative succeed, would be formation of an entrepreneurial ecosystem as discussed earlier, which would include the Interaction of government with the universities and the interaction of businesses with universities in a well-linked program. Other important success factor would be developing good teachers who can instill the qualities and traits required for entrepreneurship.

Another key area for success would be development of a curriculum which instead of suppressing the creativity of the youth would develop it. We have to adopt a strategy where we have to include all the social classes in this process. Especially we have to hunt and groom talent by outreaching the students of far flung areas.

We have to understand as a society that it will be entrepreneurship that will lead the next wave of our development in Pakistan. Global data is already available linking the US dominance in the world economy to the spirit of Entrepreneurship that is there. With the young population constituting over 25% of our population we are already facing a  population bulge that comes with a lot of threats of chaos and turmoil if not handled properly or can become a time of unprecedented growth if channelized properly.  We would not be able to engage this multitude of youth properly and feed them unless we move quickly on the road to entrepreneurship.of such work includes:

1.      Formation of innovation centers

2.      Entrepreneurial university centres and science parks

3.      Support of collaborative innovation and research

4.      Funds for the development of university projects and making them ready for commercialization

rams

There are many approaches which can be taken by our universities to include entrepreneurship as a form of mainstream learning. These approaches can be that:

1.      They can develop leadership skills

2.      They can embed entrepreneurship in general education

3.      As discussed earlier, they can take a cross-disciplinary approach

4.      They can leverage the availability of technology in the form of the technological advances in general and in the information technology in particular.

In Pakistan we can bring about a great change through the universities by creating a high number of entrepreneurs who, instead of becoming job-seekers will become job-makers and the few factors which can help this initiative succeed, would be formation of an entrepreneurial ecosystem as discussed earlier, which would include the Interaction of government with the universities and the interaction of businesses with universities in a well-linked program. Other important success factor would be developing good teachers who can instill the qualities and traits required for entrepreneurship.

Another key area for success would be development of a curriculum which instead of suppressing the creativity of the youth would develop it. We have to adopt a strategy where we have to include all the social classes in this process. Especially we have to hunt and groom talent by outreaching the students of far flung areas.

We have to understand as a society that it will be entrepreneurship that will lead the next wave of our development in Pakistan. Global data is already available linking the US dominance in the world economy to the spirit of Entrepreneurship that is there. With the young population constituting over 25% of our population we are already facing a  population bulge that comes with a lot of threats of chaos and turmoil if not handled properly or can become a time of unprecedented growth if channelized properly.  We would not be able to engage this multitude of youth properly and feed them unless we move quickly on the road to entrepreneurship.

(The writer can be reached at kashifmateenansari@post.harvard.edu)