Entrepreneurship Education: Promoting an enterprising culture among students Herbert Mapfaira Department of Mechanical Engineering Gosekwang Setibi Department

Entrepreneurship Education: Promoting an enterprising culture

among students

Herbert Mapfaira Department of Mechanical

Engineering

Gosekwang SetibiDepartment of Management

Outline

Introduction

Research Motivation

Role of entrepreneurship in economic growth

Role of entrepreneurship education in promoting an enterprise culture

Current state of entrepreneurship in Botswana

Fostering entrepreneurship and a culture of enterprise

Conclusions2

Introduction

Definition of Entrepreneurship

• Entrepreneurship refers to an individual’s ability to turn ideas into action.

• It includes creativity, innovation and risk taking, as well as the ability to plan and manage projects in order to achieve objectives. (European Union, 2012: 7)

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Introduction Importance of Entrepreneurship

• ENTREPRENEURSHIP is at the heart of economic growth of any nation.

• It is a major source of innovation, enterprise productivity, and employment.

• Entrepreneurship has also been identified as a mechanism by which many people enter the society’s economic and social mainstream, aiding culture formation, population integration, and social mobility

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Introduction Importance of Entrepreneurship• Entrepreneurship is a key driver of economic growth

• This can be demonstrated by using entrepreneurial activity as a measure of economic activity

• According to the Global Entrepreneurship Monitor (2002), the national level of entrepreneurial activity has a statistically significant association with subsequent levels of economic growth.

• GEM data also suggests that there are no countries with high levels of entrepreneurship and low levels of economic growth

• Empirical studies indicate that industries with a high share of small enterprises relative to the same industries in other countries perform better in terms of output growth during the subsequent 3-4 years

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Research Motivation Research Question

• The level of entrepreneurship varies across different countries, with some countries recording significantly high levels of entrepreneurial activities.

• A high level of of entrepreneurial activity has been shown to foster competition, innovation, economic growth, job creation and wellbeing of the citizens (Raposo and Paco, 2011).

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Research Motivation Research Question• Through its Vision 2016 policy, the government of Botswana

identified building entrepreneurship capacity through entrepreneurship education as key to delivering the vision.

• By introducing entrepreneurship education, the government hopes to promote an enterprise culture among students and thus prepare them for self-employment upon graduation.

• This paper examines the following questions:o What is the role of entrepreneurship education in promoting an

enterprise culture?o What is the current state of entrepreneurship in Botswana?o How can entrepreneurship and a culture of enterprise be

fostered?7


• Enterprise is defined as the application of creative ideas and innovations to practical situations

• Both enterprise and entrepreneurship education focus on equipping students and graduates to develop their overall effectiveness beyond the educational setting

• Cultural factors can affect an individual’s willingness to start or grow a business.

• Some of these factors, such as “fear of failure” may be deep-rooted, and others such as the attitude to enterprise, can be instilled in people from an early age

• The role of enterprise and entrepreneurship education is to change people’s attitudes and to foster entrepreneurial attitudes and behaviour

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• Generally, entrepreneurship education aims to increase the awareness of entrepreneurship as a career option, and enhance the understanding of the process involved in initiating and managing a new business enterprise. It covers:

o Education “about” enterprise (i.e. Entrepreneurship awareness),

o Education “for” enterprise (i.e. Preparation of aspiring entrepreneurs for business creation), and

o Education “in” enterprise (i.e. Training for the growth and development of established entrepreneurs).

o Providing the business skills that are needed in order to start a new venture.


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• The objectives of entrepreneurship education can thus be summarised as follows (European Communities, 2004):

o Promoting the development of personal qualities that are relevant to entrepreneurship, such as creativity, spirit of initiative, risk-taking and responsibility;

o Raising students’ awareness of self-employment as a career option (the message being that you can become not only an employee, but also an entrepreneur);

o Providing the business skills that are needed in order to start a new venture.


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Case Study on developing enterprise culture: Kaufman Center for Entrepreneurial Leadership

• A Kauffman Center study (Charney and Libecap, 2000) finds that education in entrepreneurship increases the likelihood of start-ups, and self-employment, and enhances the economic reward and self-satisfaction of entrepreneurial individuals

• In particular, compared to other business school alumni, entrepreneurship graduates: o Are three times more likely to start new businesses. o Are three times more likely to be self-employed. o Have annual incomes that are 27% higher and own 62% more assets. o Are more satisfied with their jobs.

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Case Study on developing enterprise culture: Kaufman Center for Entrepreneurial Leadership (Cont’d)

• The Kauffman study also found that:o On average, small firms employing entrepreneurship graduates

had greater sales and employment growth than those that employ non-entrepreneurship graduates.

o Entrepreneurship graduates seem to gravitate toward high technology companies.

o Entrepreneurship graduates either founded or worked for high-technology firms in greater numbers than other business school alumni.

o Entrepreneurship graduates are more involved in new product development and research and development activities.

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Entrepreneurship in BotswanaEntrepreneurship Intention and Activities Outcomes• About 71% of adult population report claims that

they have the skills, knowledge and experience for undertaking entrepreneurial activity.

• 67% of adults (18-64 years) in Botswana believe that they have identified opportunities for starting a business

• BUT only 28% are involved in the early stages of business creation and ownership

• About 28% of Botswana’s adults are involved in the early stages of business creation and ownership

• BUT only 6% of adults actually own an established business

• 77% of Botswana’s young people (18-34 years) reported that they intend to go into business in 2012.

• 70% of young people claim to have the necessary skills to go into business.

• 66% of young people felt that they can identify good business opportunities.

• BUT only 28% are early stage entrepreneurs.

• 73% Batswana view entrepreneurship as a career option

• BUT only 28% are involved in the early stages of business creation and ownership

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Entrepreneurship in Botswana (Cont’d)

• The state of entrepreneurship in Botswana indicates following shortcomings: Poor attitude towards entrepreneurship Inadequate promotion of entrepreneurship Lack of entrepreneurship knowledge / education Poor access to financing Poor enterprise management growth skills Lack of start-up support High entrepreneurship entry barriers

Entrepreneurship Intention and Activities Outcomes• 25% of Batswana are deterred from

entrepreneurship due to fear of failure.• About 16% of Batswana reported relinquishing a

business.• 40 % of start-ups fail due to lack of adequate

financing and lack of profitability.

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• Promote an entrepreneurial society and a culture of enterprise, in particular through education and training. o Integrate entrepreneurship at all levels of the formal education system

(from primary to university) and o Ensure access to information, skills and expertise relating to

entrepreneurship via “lifelong learning” programmes for the adult population.

o Remove barriers to entrepreneurship among specific target (marginalised) groups within the population (e.g. women, youth)

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• Create an entrepreneurial business environment conducive to enterprise creationo Remove administrative and regulatory barriers to new firm entry and

growth, o Policy design in areas such as competition, the regulatory framework, the tax

system, labour markets etc should take account of the way these areas impact SMEs and innovation in knowledge-based economies.

o Improve access to financing and to information, and other support infrastructure and services to build capacity of start-ups.

• Ensure the reduction and simplification of administrative regulations and costs which fall disproportionately on SMEs. o Take account of SME views during the regulatory process; o Employ requirements for regulatory agencies to prepare Small Business

Impact Statements during the regulatory process.o establish one-stop shops for regulatory information and transactions; 16

Conclusions • The study has shown that the state of entrepreneurship in

Botswana is poor.

• Though intentions to set up businesses are high, perhaps a sign of high unemployment rate, very few people goes on to form a business.

• This indicates existence of entry barriers and lack of skills and knowledge on entrepreneurship.

• A framework that can be used to formulate entrepreneurship policy to alleviate the problems was presented.

• It is believed that the formulation of a robust national entrepreneurship policy and its effective implementation will assist the country in increasing the rate of new firm creation and improve the growth of newly formed companies

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Documents

Entrepreneurship Education: Promoting an enterprising culture among students Herbert Mapfaira Department of Mechanical Engineering Gosekwang Setibi Department