Educated Entrepreneurs

A recent post at A VC makes the argument that entrepreneurs do not need degrees.

"Entrepreneurs don't need degrees like lawyers and doctors do. They are credentialed by virtue of their track record. The first startup is hard but if they make that one work, they end up with something much better than a college degree. They have a notch in their belt. They've got a track record of success. Even if the first one is a failure, I'd say that they've got something more than a degree. They've shown they can start something from nothing, build a team, a product, and maybe even a business."

While I agree with the idea that you don't need a degree, research clearly indicates that entrepreneurs are more successful when they have an education. But don't take my word for it. Here are some examples from the research on this topic:

Education of entrepreneurs has a positive influence on:
1. your ability to marshal the necessary resources (tangible and intangible, financial and psychological) to be able to start the business
2. your ability to identify new opportunities as well as learn about what is going on in your market and the technological domain that applies to your business
3. more educated entrepreneurs have more positive expectancies for the growth of their businesses, possibly leading to higher levels of effort and resilience
4. the firms of more highly educated entrepreneurs tend to have higher performance, and better survival rates.

There are some important caveats here. First, education is typically used as a proxy for intelligence. It is much more difficult to measure intelligence, but it is intelligence rather than education level that is expected to produce the benefits listed above.

Second, it is important to acknowledge that education is not the same as getting a degree. So many famous entrepreneurs (Richard Branson, Steve Jobs, Bill Gates) got the major part of their educations from their experience and the opportunities they created. Their formal educations, or lack thereof, are not what helped them succeed so much as their intellect coupled with their environments.

However, for all those bloggers and twitterers out there re-blogging and re-tweeting the meme in the form 'education doesn't matter for entrepreneurship' beware! The evidence is against you on this one.

Heresy in management?

When it comes to management knowledge are you catholic or heretic?

So here is a metaphor for considering the two ‘sides’ in the discussion about creating legitimate new knowledge about management. The question is: are you catholic (small c) or heretic in your views?

The catholic approach to knowledge is universal, hierarchical, dis-integrated and handed down from above by an expert ‘caste’ or ‘priesthood’ who have some inherited or earned rights to control or legitimate the knowledge. Is this what some perceive as the current position of management scholarship? Is knowledge of the research process ultimately used in a self-serving and inward looking way (towards other academics) rather than necessarily solve the practical problems of management?

The contrast with the catholic approach is the heretical which I will refer to as gnostic. The gnostic approach to knowledge is particular, personal, holistic, and integrated. I see the gnostic view as represented in action research and cooperative or collaborative inquiry, and often also implicit in the works of many management sages and gurus. In fact, one might argue that the popularity of non academic management guru’s and sages may come from the perceived legitimacy of experience over pure intellect. Notably, the gnostic approach to knowledge of management is also implicit in development activities involving experiential learning.

Here is my bullet point summary of the two perspectives:

Catholic view:
• There is a knowable universal truth about management practice(s). This ‘true knowledge’ exists objectively and can be received, and also disseminated effectively through exoteric teaching in text books.
• There is one way to receive this truth and that is from an ‘apostalic’ priesthood. That is, from wise and skilled initiates who themselves received the knowledge from their teachers (the 'vestigial tail’ of this idea is revealed by a concern with one’s academic ‘family tree'!)
• The acquisition of true knowledge requires the development of specialized skills. This justifies occupational segregation – there are managers, and there are 'management scholars.’
• Failure to adhere to the 'right path’ leads to heresy and illegitimacy. There are right and wrong ways to acquire knowledge of management. Individual experience tends to be devalued and critiqued as in-valid, not generalizable, and subjective.
• A catholic view leads to dis-integration of the knower and the knowledge. This is because of the assumed primacy of objective scientific values, coupled with the dominant interpretation of these values as being realist and positivist.

Gnostic view:
• Consistent with the catholic view, there is a knowable universal truth. However in this case truth may be experienced directly and personally through reflective or contemplative thought.
• There are many ways to achieve this knowledge. However, ultimately it is derived from engagement with the object (management practice) rather than separation from it.
• The tools for knowing are consistent with those from the catholic perspective. These include interpretation, inductive and deductive reasoning, critical and systemic/systematic thinking. These tools are attainable by the thoughtful and not only those who are initiated by an ‘apostolic priesthood’. However from this perspective, knowing does rely upon esoteric knowledge, and this implies that you do in fact need to be initiated, or enlightened in some way – this knowledge is not for everyone!
• Because many diverse ways of knowing exist, and personal experiences are unique, a gnostic approach is heterodox by definition – in contrast to a conservative and orthodoxy-reinforcing approach depicted by the catholic perspective.
• Obtaining true knowledge about management is not the realm of the academic alone – in fact at the extreme, there is no requirement for a ‘priesthood’ at all.
• Because of the inseparability of knowing and knower, the gnostic view is inherently integrative with respect to these categories (i.e. knowledge and knowledge-holder).

I believe that there are numerous avenues here to explore, such as the question of whether heterodoxy can coexist with an MBA education (as in 'Managers not MBAs'), the place of the management journal in informing practice, and the contribution of management practitioners to academic discourse.

What do you think?