THE MANAGEMENT EDUCATION & ENTREPRENEURSHIP ORIENTATION :A STUDY CONDUCTED IN THE B-SCHOOLS OF TAMIL NADU

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1 Article No.5 THE MANAGEMENT EDUCATION & ENTREPRENEURSHIP ORIENTATION :A STUDY CONDUCTED IN THE B-SCHOOLS OF TAMIL NADU Dr.R. Jayaraman Formerly Special Officer (Planning & Development) and Chairperson, School of Business Studies, Madurai Kamaraj University is currently the Member Secretary of Centre for Entrepreneurship Development (Tamil Nadu) K.Bennie Joel & A.Dhanalakshmi Ph.D Scholars in the Faculty of Business Administration of Madurai Kamaraj University Abstract: The Economic growth of a country depends on its Industrial Growth. The Industrial growth of a country depends on the Entrepreneurial Competencies of the people. Innovation and Creativity are the foundation of Entrepreneurship. The country requires more and more entrepreneurial talents to achieve the desired levels of economic growth. Hence, the Entrepreneurship Development is a nation building exercise. This paper focuses on one specific sector i.e. higher education specializing in Management. The entrepreneurial competencies among the MBA students will be the driving force for them for venture creation. Only through such competencies, they can be moulded as job providers rather than job seekers. However, the emergence of entrepreneurial competencies among the MBA students may depend on: 1. The curriculum design i.e. the course structure of the MBA programme 2. The delivery mechanism of the MBA faculty 3. The academic environment of the B-Schools. 4. The networking of the B-Schools with Business and Industry. 5. The parental guidance and support in Venture Creation 6. The Government policy encouraging the technocrats for Venture Creation This paper has attempted to study the above factors and to come out with recommendations to groom the MBA students with entrepreneurial competencies. Keywords: Entrepreneurship, Business Education Employability, Value Creation, Technocrats. Management Education in India: The management education in India has a 60 years history. The first structured MBA programme was offered by Andhra University at Visakhapatnam, Andhra Pradesh during the early 1950s.

2 Today it is learnt that around 3000 institutions are offering MBA programme in the country. The growth of the management education can be better understood by the cut off year During this year only, the All India Council for Technical Education (AICTE) brought the management education under its purview as a technical qualification. Till then, the MBA programme was under the purview of the respective affiliating universities. For around 40 years since independence (Till the year 1988) there were only 80 institutions in the entire country offering MBA programme. The number of seats in each institution was also restricted to 30 under the university system. Around 2500 MBA candidates were made available to the industry through these 80 institutions. During this time, the AICTE brought the MBA programme under its purview for the purpose of regulating the quality of the management education in the country. The Liberalization, Privatization and Globalization (LPG) programme of the Government of India was also initiated in the early 1990s which added fuel to the growth of the MBA programme. Within the next 10 years, i.e., during the period of the country had 800 institutions (10 fold increase) offering MBA programme. The AICTE also liberally granted 60 students as a batch and with the result around 25,000 candidates were made available to the industry during the said period. Now, with the more liberal attitude of AICTE permitting an intake of 120 and 180 students by the MBA institutions and more number of institutions are offering MBA Programme. Our country has the distinction of being massive in numbers in any field of economic life. The 4,200 B-schools in India form 33% of the total number of B- schools in the world, with about 400,000 graduates coming out every year. This is a formidable number. And there is no market for such large numbers. Prof.J. Phillip, Founder-President, XIME, Bangalore; and former Director, IIM-Bangalore has stated the above in his recent article in Business Today dated October 28, Importance of Entrepreneurship 1. Entrepreneurship is a key driver of our economy. The present growth of economy can be attributed to the Entrepreneurial success of our business men and industrialists. 2. Further, many Entrepreneurial individuals who started small ventures have grown big through their entrepreneurial talents. Their achievements resulted in substantial wealth for them and thousands of jobs for the youth. 3. People exposed to entrepreneurship ventures frequently express the opinion that they have more opportunity to exercise their creative freedoms, higher self esteem, and an overall greater sense of control over their own lives. 4. As a result, many experienced business people, political leaders, economists and educators believe that fostering entrepreneurial culture will maximize individual and collective economic and social success on a local, national, and global scale. 5. A number of agencies attached to the various ministries of Government of India such as Ministry of Science and Technology, Ministry of Food Processing, Ministry of Micro, Small and Medium Enterprises (MSME) are taking various initiatives to prepare the youth and adults to take up entrepreneurial ventures and strengthen the Indian economy.

3 6. The implementing agencies of the prestigious National Skill Development Mission which aims at training 50 crore youth by 2020 in various sector specific skills focus on Entrepreneurship as an important component as it will make the youth job creators rather than job seekers. Entrepreneurship education is a lifelong learning process, starting as early as elementary school and progressing through all levels of education, including Post Graduate Management Education. The Standards and their supporting Performance Indicators can form the framework for teachers to use them in building appropriate course objectives, learning activities, and assessments for their students. Using this framework, students will have: progressively more challenging educational activities; experiences that will enable them to develop the insight needed to discover and create entrepreneurial opportunities; and the expertise to successfully start and manage their own businesses to take advantage of these opportunities. The aspirants of MBA programme: The middle class community is a major beneficiary of the MBA programme. This section of the population normally suffers from two middle class myths: Maintaining the status-quo Fear of security The middle class community is regarded as risk avoider and it functions with a fixed budget. Thus the middle class community is not courageous to become innovative. They prefer to continue the established procedures and practices. The housing loan, vehicle loan, loan for home appliances, etc., have been structured and targeted mainly on the middle class community. Similarly, the education loan to do the MBA programme came as a big relief to the middle class community. In such a community, it is natural to see the hesitation on the part of employable graduates to go for self employment or to undertake venture creation. The graduates of this community would like to get employed and pay back the loan taken for MBA education. The Paradox The commercial ventures pose a number of challenges to the entrepreneurs. To do business, one has to acquire significant level of knowledge and skill to address a variety of business issues. Innovation and Creativity are the foundation for the successful business ventures. At the same time, such an amount of knowledge and skill may not be required for a person to work for others or to carry out the instruction of the superiors. In public institutions, innovation and creativity are discouraged. But the irony is that the venture creation became a last option for the unemployable people with relatively lesser amount of knowledge and skill. The question of adopting innovation and creativity in the work situation may not arise with such people. In this context, the biggest question is whether the current MBA programme has been designed to inculcate innovation and creativity among the students.

4 The employability of MBA students in India: According to a nationwide survey conducted in 2012 by MeriTrac & MBAUniverse.com, only 21% were found to be actually employable. Thus only one in five MBAs was found employable. The employability standard of MBAs has drastically come down. This report clearly brought out the employability gaps among the MBA candidates and highlighted the need for the entrepreneurial competencies among the Management Students. Such competencies would be helpful to encourage innovation and creativity. The need for Entrepreneurship Orientation Entrepreneurship orientation is not only seen as imperative to business growth and success but also for the individual development of the persons. The Entrepreneurship Education and Training provides an opportunity to the persons to understand, actualize and energize their inner potential for positive action. The training develops the questioning attitude of the students. The training emphasizes the importance of innovation and creativity to excel in their performance of the students. Over all, the entrepreneurship training makes a person as a performer. Our former President of India Dr. A.P.J. Abdul Kalam has also quoted the importance of entrepreneurship orientation in the education system in the following lines: Educational system should highlight the importance of entrepreneurship and prepare the students right from the college education to get oriented towards setting up of the enterprises which will provide them creativity, freedom and ability to generate wealth. Diversity of skills and perseverance in work makes an Entrepreneur. Entrepreneurship Orientation: The Entrepreneurship Orientation will facilitate the MBA students to acquire knowledge and skill for venture creation. When the focus is on developing the entrepreneurial competencies in an individual then the performance of that individual at the level of student, employee, commercial entrepreneur or a social worker can have a desired output or impact. Hence, by making the MBA students aware of the entrepreneurial competencies and encouraging them to acquire these competencies during the MBA programme, the students may become innovative and creative. Such students even if they are employed they will be better performers and more accepted by their employers. Most of the large organizations think in terms of establishing Strategic Business Units (SBUs) to contribute to the overall growth of the organization. The MBAs trained in entrepreneurial competencies will be more suitable to lead such SBUs. The MSME sector requires such competent professionals to establish commercial ventures in that sector. The MBAs with entrepreneurial competencies can turn out to be the competent professionals to establish the commercial ventures in the MSME sector. Research Methodology: This study aimed at analyzing the entrepreneurial intentions of students. The researcher assumed that certain entrepreneurial intentions and their demographic background motivate persons to become entrepreneurs. In order to access the relevance of the introduction of entrepreneurship intention in the curriculum of higher education, it was considered appropriate to administer a structured questionnaire to the students.

5 The research instrument was structured into two parts. The first part included socio demographic variables (personal background of the respondents) and the second part included variables to measure entrepreneurial competency, entrepreneurial intention, education and perception/opinion on entrepreneurship. A Self Rating Questionnaire which consists of 70 brief statements was administered to MBA students of different colleges in Tamil Nadu. Out of 1000 questionnaires 200 fully completed questionnaires were chosen via stratified random sampling method and used for the study. Data for the study was gathered from a self-administered questionnaire conducted among management students in Tamil Nadu. The unit of analysis was the Students of Master of Business Administration (MBA) of different colleges in Tamil Nadu. The questionnaire is adapted from Entrepreneurship Development Institute of India (EDI), Ahmedabad and used as a means for data collection. Initiative is an important variable that support all other competencies. However, the students were assessed on other different competencies. The questions were related to the variables: initiative, opportunity seeking, persistence, information seeking, concern for high quality of work, commitment to work contract, efficiency orientation, systematic planning, problem solving, self confidence, assertiveness, persuasion and use of influence strategies and the dependent variable of entrepreneurial competencies for the success. The scales used in the questionnaire was based on a 5-point Likert scale (with 1 = not at all, 2 = very little, 3 = somewhat, 4 = well, 5= very well) for each close-ended question. One Thousand (1000) questionnaires were distributed through stratified random sampling method to target respondents. Every sixth student was chosen from the register as a respondent. The respondents were given one hour of time to return the questionnaires. After the screening, the questionnaires which are fully completed and usable were taken. SPSS was used to analyze the data. The Interim Findings of the Study: The survey has not been completed as the researcher would like to cover 1000 students. However, as on September 30, 2012 the researcher interviewed around 400 MBA students. Based on the survey results, the interim findings are presented. 1. Demographic profile: The survey included items inquiring about the age, gender, father s occupation, work experience and the attraction of the profession. It was found that majority of the respondents were between years old (44%) followed by the age group of years old (34%) and a third category of years old (22%). The genders of the respondents were male (52%) and females (48%). The vast majority of the student s father s occupations are employed in private and public sectors (56%) with the remaining running a business (38%) or unemployed/retired (6%).

6 The higher response for attraction towards entrepreneurship among the respondents from business families was due to the parental influence. 2. Perception of the MBA students: For the specific question of Entrepreneurship as a career option, 68% of the respondents negated and only 32% accepted. When the students were asked to explain the reasons for lack of interest in Entrepreneurship as a career option, the following reasons emerged: No motivation (32%), Lack of support from parents (18%), Gender (18%), Not interested (14%) and Due to lack of entrepreneurial skills (14%) The results suggest that the majority of the respondents felt that there was no motivation to pursue a career as an entrepreneur as opposed to being just not interested. Of greater concern is the number of respondents who chose not to pursue an entrepreneurship career because of the lack of parental support or because they felt their gender was a limiting factor. 3. Class room experience of MBA Students: The MBA students are by and large confined to the course content available in the text book and as recommended by the teachers. They are unable to go beyond the course content. The regular faculty members are more examination oriented. The students are excited by the guest lectures given by the practitioners as they give more illustrations which are interesting to listen. But such opportunities are available only at the minimal level. The classroom delivery focuses more on teaching and not on facilitating learning. With the result, the students depend on their memory power rather than the internalization. When the MBA programmes are part of a college or university, the MBA students are not given any special focus. The stand alone MBA institutions are preferred by students for this purpose. The Critical Entrepreneurial Competencies i.e. Initiative, Innovation and Risk Taking are not encouraged by the average faculty members. Conclusion and Recommendation: This study has provided some useful insights into the entrepreneurial intention among the MBA students in Tamil Nadu. It was designed to determine the entrepreneurial competencies among the MBA students and the reasons for lack of motivation towards venture creation. The students need to know their strengths as well as inadequacies so as to facilitate them to overcome their deficiencies for venture creation. The key issue then is the effectiveness of the MBA programme and the entrepreneurship orientation needed in the course structure. The parental support is also a significant factor in encouraging the MBA students towards new venture creation. The level of

7 awareness about the Government policy to promote entrepreneurship and also the role of the various entrepreneurship support institutions in encouraging new venture creation is also low among the MBA students. The results of the study suggests the need for an increase in motivation for students to pursue an entrepreneurial career by motivating the students to take an entrepreneurship course. Support is required from parents, government and industry to encourage entrepreneurial intention with a platform to promote voices for change and to be inspirational for other students. Accordingly, the following recommendations have been made. 1. The authors recommend that the Management institutions may review the course structure and content of the MBA programme. 2. The delivery of the course content may encourage the participation of the students as well as raising questions, clarifications, etc. to facilitate internalization. 3. The faculty members may be encouraged to undertake research and also field study to provide research based content and practical exposure to the students. 4. The students may be encouraged to undertake mini project works as part of their major courses, summer internship in reputed institutions and a good project work on specific issues as advised by the industry practitioners. 5. The MBA students may acquire soft skills which are the foundation both for employment and for venture creation. 6. The competent MBA students may be given special focus on venture creation to facilitate them to create jobs for others. References: Bird, B., Toward a theory of entrepreneurial competency. Advances in Entrepreneurship, Firm Emergence, and Growth, JAI Press, 2, Bird, B., 2002, Learning Entrepreneurship Competencies: The Self-Direct Learning Approach, International Journal of Entrepreneurship Education, 01, GIAN JYOTI E-JOURNAL, Volume 2, Issue 3 (Jul Sep 2012) ISSN X Man T. W. Y. and Lau T., Entrepreneurial competencies of SME owner/manager in the Hong Kong services sector: A qualitative analysis, Journal of Enterprising Culture, 8, Stoof, A., Tools for the Identification and Description of Competencies, Thesis Dissertation, Open University of Netherland. Jayaraman.R., Introduction to Entrepreneurship, CIE programme of IGNOU, New Delhi Phillip.J., Business Today, October 28, The Business of Business Schools.

8 Bird, B. (1988). Implementing entrepreneurial ideas: The case for intention. Academy of Management Review, 13(3), Boyd, N. & Vozikis, G. (1994). The influence of self-efficacy on the development of entrepreneurial intentions and actions. Entrepreneurship Theory and Practice, 18(4), Gatewood, E., Shaver, K., Powers, J., & Gartner, W. (2002). Entrepreneurial expectancy, task, effort and performance. Entrepreneurship Theory and Practice, 27(Winter), Krueger, N. (1993). The impact of prior entrepreneurial exposure on perceptions of new venture feasibility and desirability. Entrepreneurship Theory and Practice, 18(1), ****************

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