Are management graduates meant to be corporate servants or corporate masters? As a responsible member of the student community, what steps would you take to promote entrepreneurship among B-school students? Suggest implementable solutions.
As I started writing this essay, I decided to do some research on the topic. My usually trusty google was not of much use. I suffered my first writers block (in only my second day as a writer) as I tried to think of the correct google keywords to research this topic. After being directed to the websites of a British band - Depeche Mode, whose eleventh album name uncannily matched my search keywords, a dozen employment sites for hiring domestic help (sigh.. there goes my b-plan idea), and having found admission information for half the entrepreneurship MBA courses in the world, I realised that google would fail me this time. I closed the laptop and picked up the good old pen and paper.
An entrepreneur is defined as a person who organizes, operates, and assumes the risk for a business venture. Being a business owner or entrepreneur requires many qualities including being creative, responsible, goal oriented, independent, self-demanding, confident and risk-taking, and having an inquisitive nature and a restlessness for success.
A manager, in contrast, is an individual employed by an organization who is responsible and accountable for efficiently accomplishing the goals of the organization. Managers focus on coordinating the efficient use of resources, planning, supervising, organizing, staffing, evaluating, negotiating, and also representing the company that hires them. Needless to say, he subscribes to the standards of practice and code of ethics established by a recognized body.
A professional manager does the following -
1. Have an insight of his job requirements
2. Carry out continuous updating of his learning to fulfil his job requirements;
3. Have a performance-oriented relationship with his subordinates, seniors, and colleagues based on mutual respect to facilitate team work for collective contribution to the organization;
Managers vs. Entrepreneurs
Managers are constantly asked to behave like entrepreneurs. The other way round, entrepreneurs are often asked to behave like managers. The manager is supposed to develop the drive and opportunism of the entrepreneur, and the entrepreneur is expected to learn the methodical disciplines of the manager. The pressures on both have become more intense as the economy has become more competitive, more entrepreneurial, more demanding. This has resulted in their roles merging in recent times. However some important differences remain.
1. Behavioural Approach - The entrepreneur likes to be in control of his life and business while the manager is entering a business where an entrepreneur is looking to delegate and not do it all himself.
2. Underlying Philosophy - The entrepreneur is characterised by concepts like creativity and innovation while the manager is characterised by concepts like order and procedures indicating the desire to maintain and organise what exists.
3. Entrepreneurs are noted for their ability to react quickly to new opportunities while managers are known for their medium and long term planning and controlled growth designs.
4. The entrepreneurial organisation is characterised by an informal and flexible structure while a professionally managed organisation required a formal and fairly rigid structure.
5. The entrepreneur is generally more of a risk taker while the manager is usually risk averse and often tries to maintain status quo or consolidate.
The Theory of Organisational Behaviour
Having noted these differences, it is important to realise that entrepreneurship and professional management are adjacent stages in an organisation's life cycle. The Theory of Organizational Behaviour distinguishes five classic phases in the development of an organization:
Phase 1: Enterprise – Creativity, entrepreneurship, innovation
Phase 2: Establishment - Professional Management
Phase 3: Delegation of Authority
Phase 4: Coordination Between the Various Parts of the Organization
Phase 5: Cooperation Between the Various Parts of the Organization
The theory also teaches us that moving from one phase to another is always accompanied by a crisis of sorts in an organisation. In the case of moving from phase 1 to 2, the very qualities necessary to set up a new business, are the qualities which will adversely affect the smooth running of that business, sometimes, fatally. The conflict arises from the fact that the entrepreneur, who takes significant personal and commercial risks to set up the enterprise and works to strengthen and spread it, at some point needs to discover that the business is working well and he can sit back, relax, and enjoy the fruits of his labours. But the typical entrepreneur is not the type to take things easy; he continues to be actively involved in the day-to-day activities of the company, which is growing quickly and now requires organized administration. His involvement can lead to hostility and tension, which damage the organization's ability to function and even to survive.
Where does the MBA fit into all this?
The first part of the question that drives this essay can be rephrased in terms of the Theory of Organisational Behaviour. Is the goal of the MBA course to teach people how to excel in Phase 1 or in Phase 2? Ideally, an MBA is looking to train us to administrate or manage a business, whether it is our own or someone else's. Of course, this is relevant to the entrepreneur as much as it is for the person looking to work in a corporate setting. The entrepreneur is taught to be prepared for the next phase of his venture and to incorporate a formal structure into his company as early as possible so as to make the transition to the next phase smooth and seamless. The b-school also looks to teach a person how to look at a problem from all possible angles. While an MBA is an extremely useful feather on the cap of an entrepreneur and almost a natural succession of sorts for him, entrepreneurship may not naturally follow the MBA course. An MBA, therefore intends to prepare us for starting a business and for a job equally well and what we take up ends up being a personal choice.
Corporate Master or Corporate Servant – Making the personal choice?
When we are looking to make a personal choice about the kind of Corporate role we want to take, the question does not remain whether we are looking to be a corporate master or corporate servant. Such a thought process is self-deprecating or self-indulgent depending on the case and paints a false picture of the true goal of a corporate worker. In any role, the aim of a worker in any ethical organization should be to serve those that the corporation serves and not the organisation itself. This is similar to the title of government servants. The aim of the government employees is to serve the people of the country as those are who the government is looking to serve. And this does not change if we are so called “corporate masters”. Even when we are looking to take over the running of businesses that provide employment and revenue, we need to look at this role of Corporate Master in the sense that we are a captain of a ship. Our job is to steer the ship and like everyone else on the ship, are subservient to the higher aim of service that the corporation stands for.
What can be done to help nurture entrepreneurship?
The biggest deterrent to entrepreneurial thought in a b-school becomes the downside of failure. Of course, in effect this does not decrease after going to a b-school. In fact, the chances of success only go up after going through the rigour and training that is received at a business school. However, the perceived risk goes up due to the availability of new, “easier” options in the corporate world. Though a school can’t be blamed for providing good opportunities to its students, what is needed is a balance in its effort to promote corporate managers and entrepreneurs.
Entrepreneurship is a trait bred through attention to detail, creativity, innovation and exposure to ideas. People might argue that creativity and innovation is something that can’t be bred in a business school. However, the correct exposure and the right training can not only give a push to people with existing entrepreneurial mindsets, it can also nurture new minds to think in that direction. When it comes to entrepreneurship, the god is in the detail and in the way you look at opportunities around you. For example, someone may see the recharge-through-SMS options for mobile phones that replaced scratch cards a few years ago as a value added service. While someone else might envision a cost saving of millions brought about by removing the investment in making the scratch card, the accompanying supply chain network which reached out to millions of locations and the investments in security required for scratch card codes. This detail is something that a b-school teaches us to look at through its academic rigour and through the efforts of the faculty.
Placement Holidays
Some steps are being taken by certain institutes to soften the downside of failure through allowing placement holidays where students opting out of the placement process to start a venture can sit in the placement process in subsequent years. This could be extended further to a process whereby the placement authorities extend lifelong support to alumni by introducing them to the companies of their choice at any point in their life.
Incubation Cells
Incubators are also provided on many campuses which not only offer economical access to office space and technology, but also give these companies regular access to faculty insights and keep them in contact with the industry. CIIE in IIM-A is such an incubation cell and often facilitates the process of introducing potential buyers, clients, and seed funds to these companies. This task is also done through arranging Bar Camps and Entre Fairs. Further steps in this regard are organising guest lectures by VC’s and also by entrepreneurs who can share their experiences and help understand the industry and their thought processes better.
Seed Funding
Many colleges have their own seed fund whereby professors invest in business ventures of students. This not only gives students the required funding but also involves the faculty in their ventures which is tremendous support for a new entrepreneur. Again, IIM-A has 3 seed funds run by the faculty in partnership with CIIE to fund new ventures. These funds can also use students from the campus to manage them and hence give exposure similar to that in a Venture Capital firm to students on the campus.
Existing Curriculum
Cases chosen for the course curriculum in colleges often cover the problems of small organisations. This is done in order to introduce problems that are new for the entire class and are also not very multi-dimensional so as to give the faculty the ability to showcase each concept carefully. This entire practice inadvertently helps entrepreneurial thinking as people are able to see the use of management practices in small companies and can immediately relate this to small ventures that they may be planning to open. For example, Managerial Accounting taught us how to prepare a balance sheet for a beer bar or a tailor shop. We learnt to market products like solar cookers or healthy cigarettes instead of large FMCG products or laptops. In fact, the entire process of presentations is also most beneficial to an entrepreneur who will find himself pitching to clients or to his team to sell an idea.
Exposure to Outside World through Projects
It is a well known fact that most ideas emerge as a result of people identifying gaps in their immediate environment. This can be encouraged by reducing the emphasis on class room studies and exams and increasing projects through which a student can get more industry interaction and gets the opportunity to go out and work.
Courses on Entrepreneurship
Another simple and viable solution is to have a course on entrepreneurship and leadership in the first year before the summer internships when people are yet to make up their minds regarding their career paths and can benefit greatly from someone instilling a feeling of fearlessness and risk taking in them.
Business Plan Groups and projects and assignments involving the same
Students can also be given exposure to the nuances of making a b-plan through B-Plan groups, and courses which have assignments on these lines. IIM-A, for example, conducts a course on Entrepreneurship and New Venture Planning which has such a requirement. Class discussions focusing on discussing ideas, mentoring students with b-plans and introducing them to people from the industry can make this easier. An important step in this regard is to have entrepreneurship focused b-plans with implementable budgets as well.
Therefore, the idea here is for steps to be taken that balance the overwhelming exposure that the b-school student gets to corporate life through reasonable exposure to the opportunities available in the entrepreneurship domain.
Dinner
3 years ago
