Description
This detailed illustration resolve entrepreneurship teaching and promotion at and by universities.
Entrepreneurship Teaching & Promotion
at and by Universities
10 Cases
Interreg III C Network Project BEPART
(7/2004 – 12/2007; pdf by 15 Dec. 2007)
Denmark: Århus School of Business/ University of Århus
Estonia: Tallinn Technical University
Estonia: University of Tartu
Finland: Häme HAMK University of Applied Sciences
Finland: Kajaani University of Applied Sciences (2 Cases)
Germany: University of Rostock with HIE-RO
Lithuania: Kaunas University of Technology
Poland: Jagiellonian University Krakow, CITTRU (2 Cases)
BEPART is part-financed by the European Union
www.bepart.info
Content
Århus School of Business – University of Århus (Denmark)
Entrepreneurship – From Opportunity to Action – The Entrepreneurial Process
Poul Dreisler
3
Tallinn University of Technology (Estonia)
Tallinn School of Economics and Business Administration
A Case of Teaching Business Planning
Urve Venesaar, Ene Kolbre
25
University of Tartu (Estonia)
Master Program in Entrepreneurship and Technology Management:
Evaluation of the Successful Initiative in Estonia
Janita Andrijevskaja
30
HAMK University of Applied Sciences (Finland)
Competence-based Entrepreneurship Model
Entrepreneurship Incubators at HAMK University of Applied Sciences
Seija Pajari-Stylman, Heikki Hannula
40
Kajaani University of Applied Sciences (Finland)
Promoting Entrepreneurship in Kainuu
Entrepreneurship Path Cooperation Model
Päivi Malinen, Päivi Partanen
47
Kajaani University of Applied Sciences (Finland)
Business Planning 3 ECTS (Business Plan)
virtual based web – course
Pekka Tervonen
54
University of Rostock & HIERO (Germany)
ROXI Entrepreneurship Training Programme
Doreen Holtsch, Melanie Hoppe
74
Kaunas University of Technology, Regional Science Park (Lithuania)
Importance of the Programme of Entrepreneurship Training and Motivation
for Young Innovative Companies: KTC Case
Rimantas Venskus
100
Jagiellonian University, Kraków, CITTRU (Poland)
How to Take Off?
Jacek Klich, Jerzy Rosi?ski
125
Jagiellonian University, Kraków, CITTRU (Poland)
Teaching Negotiation Skills
University Model Based on Entrepreneurial Experience
Jerzy Rosi?ski, Jacek Klich
138
Editorial work: done at the University of Rostock, Chair of Business & Entrepreneurship Education (Wirtschaftspädagogik)
Publication made within the project activities of BEPART – Baltic Entrepreneurship Partners, part-financed by the EU, Interreg III C.
All information herein reflects the authors’ view only; the EU and related organizations are not liable for any use that may be made or not be made of the information.
BEPART Case – Aarhus:
Entrepreneurship – From Opportunity to Action –
The Entrepreneurial Process
Poul Dreisler
Department of Management
Aarhus School of Business / University of Aarhus
Haslegaardsvej 10
DK 8210 Aarhus V
Tel.: +45 89 48 64 64
Fax.: +45 89 48 61 25
e-mail. [email protected]
Keywords:
education, pedagogy, didactics, learning, teaching, university context, entrepreneurial
university, entrepreneurship, enterprising behaviour.
1. Executive Summary
This case will describe a specific course organised in accordance with the entrepreneurial process
model. The course is conducted by a teacher who is nearing the end of his 20-year-long involvement in
the subject field. The case starts out with a review of some of his experiences, to demonstrate that
there is a schism between didactics, pedagogy and context in relation to the subject field. It is
postulated that entrepreneurship has not found an ”intramural” place at Danish universities but to a
very large extent remains “extramural”. This leaves the universities free to ignore the much-needed
development of teaching methods, which, in essence, constitute the internal logic of the subject field. It
is further postulated that the concept, or term, entrepreneurship is its own worst enemy, because it is
so easy to either reject or isolate it as there is no tradition, scope or resources available to implement
the learning processes which are inherent in entrepreneurship and which ought to be universal. Finally,
there will be some thoughts on how teaching could be organised, based on an understanding of
’enterprising behaviour’ and the ’entrepreneurial university’.
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2. Background
2.1. Introduction
My background section is no doubt a good deal longer and more historical than expected. I have
wished to include a (far from exhaustive) outline of the development in this area, which I have been a
part of from 1989 to the present day. There are many positive elements in this historical outline, but
also many examples of opportunities wasted.
2.2. An inter-institutional cooperation
In 1989 an informal cooperation was initiated between teachers from three HE institutions in Aarhus –
the engineering college, the school of architecture’s institute of industrial design, and the business
school, ASB. The teachers decided to set up mixed project groups for their students to carry out
projects in what was then called “product development”. The cooperation was initiated quite informally
and implemented by teachers. A teacher at the school of architecture came up with the idea; it seemed
to him that his students lacked any understanding of what it was that made Danish design world-
famous in the years between 1930 and 1970. His students considered themselves to be artists,
working for the sake of art only, as he put it. What was missing was the traditional cooperation with
furniture makers and production people in general, to make them realise what was the exact purpose of
their own work. He therefore contacted the other two institutions, starting a cooperation still existing
today; however no longer with ASB as a participant.
Since then, so many things have happened that a brief outline is called for, to explain the situation
which forms the background for the way the subject area entrepreneurship is being taught.
2.3. From product development to innovation and entrepreneurship
In the next few years, the perspective of the subject area changed into ”innovation and
entrepreneurship”. These two concepts were acquiring a special status as a number of influential
players sought to further an emerging trend in society. Among other things, the rectors of the HE
institutions, representatives from the local authority and the county along with the private institution
Danish Technological Institute had visited Chalmers University of Technology in Gothenburg and
learned about their successful initiative of offering graduate engineers courses in entrepreneurship just
before they left the university. Though greatly inspired by the visit, they failed to reach any agreement
on how to implement the idea in Aarhus. So it was parked in the Centre for Business Development
(CBD), an office for business services run by the county. Each HE institutions, the ones already
mentioned plus the University of Aarhus, appointed a representative. At twice-yearly meeting they
discussed developments and how to promote entrepreneurship at the individual institution. CBD offered
courses in entrepreneurship at the university, the engineering college and the school of architecture,
which was given additional funds for its own initiatives. ASB declined the offer as it was felt that the
school was capable of developing and implementing this subject area on its own. This resulted in the
course ”Innovation & entrepreneurship”, which has been offered ever since as part of the bachelor
programme, alongside the inter-institutional projects mentioned above, referred to as TIP projects. The
course was organised so that students could take the course in their 5
th
semester, then choose a TIP
project cooperating with designers and engineers for their bachelor thesis in their 6
th
semester. But the
teachers involved never succeeded in having a formalised framework set up, which meant that the
process was difficult to manage, and not always a success. The Danish Rectors’ Conference
nevertheless granted approx 60,000 euros in 1993 to support the initiative, in order to further inter-
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disciplinarity. In 2003, ASB left the cooperation because it proved difficult to keep to the original idea
alive once new teachers took over. Only one teacher from ASB was ever involved in the cooperation,
and nobody else was willing to take over his commitment and hard work.
2.4. Promotion of entrepreneurship
The meetings in CBD did not lead to more cooperation, as CBD had its own reasons for offering
courses at the institutions. The courses were part of their business foundation and a means to attract
funds from the initiatives set up by the Danish government. In 1995 the government launched a
massive campaign to promote entrepreneurship. It did produce some results, but not in any
coordinated way, usually as a result of a few passionate individuals’ hard work and dedication. Some,
but not a lot of progress was made up to 2000. In 1999 ASB started a master programme in
“entrepreneurship”, run jointly by teachers from the University of Aarhus and ASB, and a course in
”Creativity and innovation management” was offered at the master programme. Since 1989 very few
staff members at ASB have been involved in research on entrepreneurship. In 1997 a research group
called RESME (Research on SMEs and Entrepreneurship) was established, including researchers and
teachers from other universities and HE institutions.
2.5. Study tour to the USA
However, 2001 finally marked a real change. The head of CBD, who had lived in California for 18
years, organised a study tour to the USA for the members of the working group meeting twice a year.
The tour included visits to Stanford and Seattle University, Entrepreneurship Centre and a number of
other places. It was during this trip that the idea of establishing a centre in Aarhus comprising all HE
institutions and supported by the county and local authority was formed: ”Aarhus – one campus for
entrepreneurship”. The idea sprang from the fact that all relevant HE institutions in Aarhus are located
within a geographical area roughly the size of the campus of Stanford University. So why not operate
as a single joint campus to promote entrepreneurship? To make a very long story short, the idea was
presented at a meeting in 2001 (shortly after the study tour). It was immediately taken up by the
administrative head of the county’s business section. In a very short time he managed to raise close to
800,000 euros from the EU’s Social Fund, whose administration was also placed in his organisation,
and he managed to raise an equivalent sum from other sources as a grant to finance Center for
Entrepreneurship (CFE) www.au.dk/da/cfe/forside for three years, starting on 1 January 2002 and
expiring at the end of 2004.
2.6. Center for Entrepreneurship
But the flying start was followed by a long and incredibly complicated process of negotiations: it soon
emerged that there were many different agendas involved here. One of the most important turned out
to be that the head of the county’s business section needed to cut his staff and budget and saw the
CFE as an opportunity to place his staff elsewhere, in an institution pursuing a good cause, and outside
his budget. The teacher/researcher representatives from ASB and Aarhus University wanted the centre
to be managed by the six HE institutions in Aarhus, and to be based on both research and education.
They found that what was being suggested was far from the idea born out of the trip to the USA. The
ensuing struggle went on and on until August 2002. CFE was officially opened on 1 December 2002 –
one year into the budget period! The management of the centre was placed in the hands of staff from
the county, and an academic council consisting of teacher representatives from the by then six
institutions associated was set up. The centre attracted an impressive board, made up of the rectors of
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six institutions and executives from the local authority and county departments for business
development. A number of adjustments were made over the next two years but nothing that changed
the fundamental state of affairs. The centre had many visitors, who were, however, often disappointed
because the centre was not what they expected, a centre for research and education. There was no
agreement on the direction in which the centre was supposed to develop. In the end, the centre was
made part of Aarhus University, governed by its rector as an ordinary staff function, disconnected from
both the university’s research and education in the subject area. The centre is today an integrated part
of Aarhus University and has started offering credit-earning courses, usually in connection with
programmes offered by the university’s institutes. The vision statement has also been changed. Now it
says: ”It is the vision of the CFE to develop and support an innovative enterprising culture and credit-
earning enterprising competences at the University of Aarhus”. Today, the centre has no importance for
the development of entrepreneurship in education at ASB.
2.7. Yet another informal inter-disciplinary and inter-institutional
cooperation
This long historical background has been included to illustrate the basic idea that has always been the
driving force behind all development of subjects and courses for the person(s) responsible for this type
of courses: that inter-disciplinarity is vital when teaching entrepreneurship. As mentioned, this course
was launched as a cooperation between two teachers from the university and ASB, involving students
from the many institutes and subject areas covered by the two institutions. For example students from
the Institute of Molecular Biology, who took the course (as well as “Creativity and innovation
management”) as part of their study programme. Later another teacher joined the cooperation, bringing
in additional students from the humanities (Institute of Information and Media Studies). This
cooperation ran for three years, until the two university teachers were asked to promote education in
entrepreneurship at some of the university’s other humanities educations. For the last two years, the
course has been offered at ASB with an intake of 40-50 students a year; in 2006 students from ASB as
well as other universities and HE institutions in Jutland, in 2007 students from ASB only. The course is
elective and open to students from all programmes offered at ASB. From 2008 all three courses, which
have been offered since the very start, will close down when the teacher retires. Only a single new
course in entrepreneurship has been established, and there will be some some general support
(coaching) for students wishing to pursue this as a career path. In addition, ASB is attached to IDEA
(International Danish Entreprenership Academy) www.IDEA-Denmark.dk, which is a large-scale
initiative seeking to promote entrepreneurship. Among other things, they are trying to promote a
master, IMEET (International Master in Entrepreneurship Education and Training). But apart from that,
IDEA has had little influence on teaching or the development of courses at universities.
2.8. Inter-disciplinarity is formalised
Over the past two years, a lot of resources have been devoted to restructuring the universities in
Denmark. ASB has merged with Aarhus University, for example. The restructuring is the result of some
degree of political pressure on HE institutions, in an effort to create new constellations in educational
development and critical mass in research. To give a very recent example, the Dean of ASB has just
signed an agreement establishing a combined education allowing engineers to add a master degree at
the ASB, based on courses like Management of Innovation and Technology.
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3. Case Description
3.1. Educational approaches and teaching methods
The course ”Entrepreneurship – from opportunity to action – the entrepreneurial process” is described
in detail in the appendices. The appendices have been arranged in the order in which the student will
meet them before and after choosing the course. First there is a course description, then an
introductory letter to the students, a plan and a description of the activities the student must take part
in, and finally a list of literature.
All courses taught at ASB must be described in detail in a course description outlining all aspects of the
course, to enable students to decide whether a course seems interesting or useful for their career
plans. Additionally and importantly, the course description is also a declaration in the legal sense,
informing the students of what to expect and what is expected of them. A new requirement was
introduced in 2007; students must now also be informed about the demands to be awarded the highest
grade (12) and the minimum demands to pass the exam (grade 2). The scale for grading must use the
descriptions of these two extremes as the basis for the grades in between (see course description
appendix 1).
Previously the course has been conducted with several teachers at the same time, which tended to be
difficult, especially since a former colleague was very fond of lecturing – sometimes for up to 3 lessons
of 45 minutes. The way the course is organised now there are no lecturing – at least not by the teacher.
The students work in groups, and it is part of the group’s duties to present a given text and, most
importantly, to demonstrate that they have not only understood it but are also able to see their own
practical project in the context of the literature studied. Quite often only a few of the other participants
will have read the text before classes, but afterwards they will have an overview of it and know in which
contexts it might be useful for them as well. This is evident later when they write their report, which to a
large extent includes the literature presented in class.
The course is dimensioned to give 10 ETCS, which amounts to approx 33% of the students’ workload
in a semester, including the time spent in class. The basis for this calculation is that the classes and the
project work represent the workload that the students must organise themselves within the framework
set out in the plan. If classes finish early one day, that means extra time to work on their own project or
consulting the teacher, who is also available for mail or phone consultation (see requirements for
student activities in appendix 4).
The philosophy underlying this view is self-evident. Professor Helge Löbler, University of Leipzig, has
an amusing metaphor to illustrate this point. Using what he calls a constructivist approach (Löbler,
2006), he takes his starting point in the differences between dogs and cats, referring to dog teaching
and cat’s learning to present his views on entrepreneurial education. ”The classical teaching approach
is dog teaching and this approach does not work for cats. But the constructivist approach is supporting
cat’s learning”. This distinction between teaching and learning is presented and elaborated on at the
meeting introducing the course. Obviously a certain knowledge of how cats and dogs behave is
necessary, but it is easy to find examples. Dogs do as they are told to do, and enjoy doing it. Cats do
what they think is sensible for them to do and learn from their actions, in contrast to dogs, Dr Löbler
says.
7
The introductory letter is also discussed at the first meeting. Not everybody will have replied, but many
will, making it possible to form an impression of what the students expect from the course. The majority
expect a combined theoretical and practical approach to entrepreneurship. Some attached more
importance to the practical aspects, perhaps expecting this to be the easiest way to succeed, which
turns out to be far from true.
The course, its methods and contents is based on three essential concepts or philosophies. They are
a) enterprising behaviour, b) the entrepreneurial process, and c) the student’s self-knowledge of their
own competences in relation to carrying out entrepreneurial processes. As for a), it is the course’s
objective to further the behaviour described in the course description (appendix 1 Performance
measurement). As for b), the objective is that the student learns the entrepreneurial process, as it is
described under Main topics. It is not a requirement that a business plan is drawn up. This phase is not
part of the course as such; the important thing is that a business idea is developed, and that the
concept of opportunity is fully understood. And finally it is essential that, under c), the students are able
to identify complementary competences needed for the execution of their idea. This is where the
original inter-disciplinary element comes in. It is a requirement, and a necessity, that the students seek
help and knowledge in areas where their own competences are insufficient. Groups formed voluntarily
tend to be fairly one-sided in their professional orientation, and it is usually evident that this kind of
parallel thinking is not the most productive.
3.2. The process to set up a coherent course and curriculum
The structure and content of the course has been described in appendix 3. The plan gives the students
all the information they need, allowing them to concentrate on their project work based on literature and
search for complementary competences. A very efficient and useful element of the plan is the ASB
intranet ”CampusNet”, which is an excellent tool for communication and for making articles, reports and
other material available for the teacher and the other students. As can be seen in appendix 5, a so-
called electronic compendium or collection of articles forms part of the curriculum together with the two
textbooks used. All study material is put on CampusNet, and the students make their PowerPoint slides
available here too. The teacher can add any material he finds useful and can send mails directly to all
approx. 50 students. There is also a list of links to potentially useful institutions in the area. As can be
seen, the plan and CampusNet constitute the technical basis for the process, and once in place
requires very little extra effort.
The course is based on a model developed by Scott Shane (2003), presenting his understanding of the
entrepreneurial process. The model explains the process in the following elements: Individual attitutes,
environment, entrepreneurial opportunities, discovery, opportunity exploitation and finally execution.
Not all elements are equally prominently in the course, e.g. not environment as it is assumed that
students at this level will be able to study this on their own. Execution is not always the most important
goal either. Students differ in their preferences; for some this is the most important element, especially
if they have a burning desire to start their own business. For others, the most important is to work with
the elements of the model and the course that relate to Individual Attributes and Opportunity, which is
where the business idea unfolds and is tested.
The course is not a course designed to prepare the students to start their own business when they
graduate. As stated before, the emphasis is on enterprising behaviour. This means that students will be
favourably disposed towards entrepreneurship.
8
This model provides an excellent guideline for the progression of the process. After the first meeting
introducing the course, the students have no problems accepting the roles assigned to the teacher and
students. The following classes are organised so that each session has two student presentations of
about 20 minutes, including a short overview of the main topics of the week’s literature as well as an
application of these topics on their own project. Then follows a discussion of the issues raised in the
presentation or relating to the topic in general. The discussion is lively, involving the entire class. The
role of the teacher is to facilitate the
discussion, if necessary, and to clarify any questions arising. The plan allows 2 lessons of 45 minutes
for these activities; sometimes they take up all the time, and other times there will be some time left for
individual consultations on the project or other questions.
As can be seen in the plan, three times students have to hand in papers on their group’s project work
(via CampusNet). The first relates to the idea or the topic of the group’s work, indicating their own
competences and interests, and including a brief outline of the next steps (1-2 pages). The teacher
gives summary feedback on this, helping the students to decide either to continue with the project or
reconsider it. Great importance is attached to the feasibility of the project and to the question whether
the competences needed for its execution are available.
The second paper to be handed in is about 5 pages, indicating the contours of the finished project. It is
usually at this stage that the need for help is greatest and the sustainability of the project needs to be
discussed. Feed-back is given in a workshop-like session, after all students have had a chance to
look at all projects in the folder at CampusNet to comment or offer advice. This class session is longer,
lasting 4 lessons of 45 minutes
Finally there is a last session shortly before the end of the course, which is mainly a chance to discuss
whether or not to expand on this or that aspect, or to clarify the final structure of the written report etc.
All questions on the substance of the project should have been dealt with at this stage - hopefully. This
session is organised as described above; the only difference is that there are more pages to look at.
The final report handed in by the students, and the basis on which the grade is given, is about 15
pages times the number of students in the group - between 2 and 4, on average 3. Up till now, the
exam has consisted of the teacher reading the report, giving a grade, and that was the final word. At
times students have wanted to have their grade explained, and once explained, that was usually it;
most students have a fairly accurate sense of the quality of their work. This exam form has now had to
be changed, as group exams are no longer allowed. All students must be evaluated individually, at an
oral exam. As the course would have no point whatsoever unless it leads to a written group report, the
exercise has been to construe an oral exam that makes sense. So now a group report is to be handed
in, and each member of the group will then be examined individually and orally in the report. The report
is to be considered the curriculum, and all group members must be able to answer questions on
anything in the report, including why some aspects have not been dealt with. The students will also be
expected to answer general questions on the literature used as the basis for the report. The new exam
form has not been tried yet. There is an ongoing struggle between the universities and the minister in
charge to reverse this change, because it undermines the basis of many courses and teaching
environments that have been highly successful exactly because the students work in groups, which, it
is argued, is the natural choice since it simulates the work form students will encounter after their
studies. But so far, unfortunately, to no avail.
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3.3. Theoretical background for the process
The background for the pedagogical process is primarily Kolb´s learning cycle describing a process
which begins with concrete experience and goes over ‘observation’ to ‘reflection’ and further on to
‘forming abstract concepts’, ending with new situations. Kolb says (see Blenker et al 2006 pp 102-104)
that the learning cycle is not really a circular process, but rather “that it is a matter of a cyclic spiral:
firstly, it is often necessary to go through the four stages several times in order to fully understand the
general principles. Secondly, it is more than a cycle, because you continually progress into a more
profound discerning of the problem dealt with – as opposed to running in circles. Thus, learning to learn
seems an important aspect in entrepreneurship since an entrepreneur frequently deals with entirely
new business concepts and therefore cannot always seek advice or guidance in his network. Hence, it
is necessary to experiment on your own; and it is far from certain that your initial, immediate
understanding of the situation and the ensuing proposal for a solution will be accurate. You develop
experience, and you learn to learn”.
In addition to recommending a cyclic experience-based learning process, the model can be expanded
to encompass a representation of the way different people adopt different learning styles.
The cycle illustrates the four learning styles: concrete experience, reflective observation, abstract
conceptualisation and active experimentation.
The four learning styles differ with respect to both benefits and the individual pedagogical techniques
applied. Application of ‘the reflective theorist’ will change the student’s knowledge of the field: he
acquires the knowledge material and seeks to conform to what has been learned. The learned material
is adopted like a manual for the individual’s activities. By applying the learning style, ‘the reflective
practitioner’, you obtain changes in your way of performing an action. This is about guidelines and
advice yielding experience during a sequence of actions. The third learning style is ‘the active
practitioner’ who, according to this division, will undergo a change in skills and in his attitude towards
entrepreneurship: he adapts. Finally, there is the fourth and last learning style, ‘the active theorist’ who
during the learning process explicates or changes his perception of the phenomenon. He is the one
who gathers the threads towards an understanding of what he is involved in.
If we investigate how this division of learning styles fits in with entrepreneurship and entrepreneurs,
Garavan & O’Cinneide (1994.1: 9-10) refer to a series of studies showing that entrepreneurs prefer one
of the active learning styles. Although, they say, practice shows that the teaching and training situation
that potential entrepreneurs are most frequently exposed to is ‘the reflective theorist’. This traditional
teaching method is focused on developing the students’ conceptual terminology, and the exam will be a
matter of an ability to repeat these concepts. Learning participation is solely reflective (non-activating).
It has never been the intention to design the course description and process to fit into a particular place
in the model; but the model helps give an understanding of where you are, and where you would like to
be heading. Learning styles are not based on an outside-in understanding, but a concept associated
usually with an individual and the way they learn (cf dog teaching vs. cat’s learning). If you
nevertheless try to place the course described somewhere in the model, it will be obvious that the
course matches the ”conceptualization part” better than the ”application part”. Even if it has been the
intention to develop ”changes in skills and attitudes”, the model would probably say that the course is
closer to ”changes in understanding”.
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3.4. The literature
The literature chosen for the course is an important part of the process. It looks like a substantial list,
and it is. It is literature at three levels: a textbook in English, with a very pedagogical structure along the
lines of Shane’s process; it is not very theory-heavy. The other textbook is in Danish, written by a
venture capitalist and entrepreneur, and it has some highly relevant ”pracademic” reflections on what it
is like to venture into the marketplace for the first time. It is a very thorough book that gives the
students a clear understanding of what it takes to make your idea a success. The third level consists of
articles and extracts from books at a higher theoretical level than the two textbooks. The purpose is to
encourage the students to read research literature on the topics they are working with. It provides a
theoretical understanding of what the textbooks are based on, which many students have stated that
they would like to have when asked why they chose the course. However, not all students get round to
reading it, but may benefit from the more hands-on practical texts. That is, much as the learning styles
mentioned above can be interpreted as individual, so the study of literature can be considered an
individual choice too. Until the change in exam form, it was accepted that the group presented their
work as a joint product, which meant that a certain division of labour was possible between the
literature/theory-inclined and the practice-oriented members of the group. This will be more difficult with
the new institutionalised individualised exam form.
4. Current challenges/ problems facing the organization/ project
experience or educational effort
Teaching at a university is a very personal activity, closely connected with the teacher’s research
interests, interests in general, age, etc. Teaching is also influenced by the climate and conditions at the
institute offering the educational activities. The ideal is cooperation based on shared attitudes towards
development, e.g a number of teachers joining forces to carry out experimenting or discipline-
transcending activities. The introductory description explaining the background for the educational
activities chosen for the course “Entrepreneurship – from opportunity to action – the entrepreneurial
process” describes how one teacher has gone through a cycle, from experimenting, crossing discipline
barriers, promoting, implementing, up to the present stage of maturity, just before retirement. A cycle
not unlike the well-known PLC curves. A development that has seen new ideas, creativity, political
infighting, professional challenges, joys and disappointments. As mentioned, when the teacher retires,
two courses in entrepreneurship will close down – leaving only one new course. This is the situation at
an institution with about 7,000 students. There are lots of things happening in environments outside
ASB, but they are not ”intramural” activities. We have got IDEA, which somehow manages to operate
without being directly anchored in the university sector. We have got CFE, who are eager to take over
formal educational activities, offering credit-earning courses. But they are not ”intramural” either. So
lots of things are happening on the entrepreneurial front in Aarhus. But there is no integration with
education, not unless the students themselves make an effort and find the relevant players – which,
fortunately, they often do. Entrepreneurship is still immensely popular. Only, there is no room for it in
the ordinary educational activities at universities and HE institutions. Entrepreneurship as an object for
learning is ”extramural”. As we are going to see later, we find ourselves in an environment marked
mainly by ”dog teaching”.
5. Further reading
See appendix 5, the e-compendium
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6. References
Blenker, P., Dreisler P., & Kjeldsen J. (2006). Entrepreneurship Education – the New Challenge Facing
the Universities - A framework for understanding and development of entrepreneurial university
communities (Working Paper). Aarhus School of Business. Aarhus, Denmark
Blenker, P., Dreisler, P., Færgemann, H. M. & Kjeldsen, J. (2006)
Learning and teaching entrepreneurship: Dilemmas, Reflections and Strategies. In Fayolle & Klandt
(eds.) International Entrepreneurship Education: Issues and Newness, Cheltenham, UK, Edward Elgar.
Blenker, P., Dreisler, P., Færgemann, H. M. & Kjeldsen, J. (in press)
A Framework for entrepreneurship education in a university context
Int. J. of Entrepreneurship and Small Business, Vol. 5 No. 1, 2008
Garavan, T. N. & O’Cinneide, B. (1994.1): ”Entrepreneurship Educa-
tion and Training Programmes: A Review and Evaluation – Part 1”,
Journal of European Industrial Training, vol. 18 (8): 3-12, 1994.
Kolb, D. A. (1984). ”Experiential Learning”. New York: Prentice-Hall, 1984.
Löbler, H. (2006). Learning Entrepreneurship from a Constructivist Perspective. Technology Analysis &
Strategic Management, Vol. 18, No. 1, 19-38,
Shane, S. (2003). A general theory of entrepreneurship. The Individual-opportunity nexus. Cheltenham,
UK, Edward Elgar
7. Appendicies
APPENDIX 1.: Course description
APPENDIX 2.: Introductory letter 2007
APPENDIX 3 a.: Plan for: Entrepreneurship – opportunity to action – the entrepreneurial
process.
APPENDIX 3 b.: Plan for: Entrepreneurship – opportunity to action – the entrepreneurial
process.
APPENDIX 4.: Explanatory notes on participant activities and report requirements.
APPENDIX 5.: e-compendium. Articles and extracts from books.
12
APPENDIX 1. Course description
25319 Entrepreneurship – from opportunity to action - the entrepreneurial process
Language: Danish
Duration: 1 semester. 10 ECTS / 27 lessons total (variable number of lessons per week)
Relations to other courses
The course is related to most of the courses taught in business studies. The course forms a good basis
for participation in the Venture Cup, which starts officially at the same time as the course and runs
parallel with the third and fourth semester of the master programme. The first phase ends in January
with a prize of DKK 10,000 awarded to the best business plan. More information at
www.venturecup.dk.
Aim of the course
During as well as after their studies, many students will be involved in business development within
existing organisations or they may wish to start their own business.
The aim of the course is to give the students the intellectual tools to approach such tasks, and to give
them insight into and competences in entrepreneurship in practice through own projects and reflection
on the projects. It is an integrated part of the course aim that the students contribute towards the
creation of learning situations that further the competences required to fulfil the aim of both this specific
course and of the study area in general – ie, the development of ’enterprising behaviour’.
Background of the course
The background of the course is the well-established fact that there is a widespread need for
innovation and entrepreneurship in the European economy; and Denmark is no exception. The study
area aims not only to motivate and educate students to start their own business but generally to
develop a certain kind of behaviour, referred to in literature as enterprising behaviour – a concept which
in a Danish context was first used in Bang & Olufsen’s vision statement in 1925.
Main topics of the course
The key objective of the course is to identify and clarify various elements of the concept
’entrepreneurship’ through the students’ own projects based on field studies. These projects will enable
the students to carry out and understand the various elements characterising ‘the entrepreneurial
process’ or method, from ’pre-idea to startup’, including:
- analysis of own competences in order to establish limitations and need for input of external
resources
- carrying out sector/business analysis to spot potential for entrepreneurial activity
- investigating why, when and how business opportunities arise
- achieving an understanding of how such opportunities can be utilized
- demonstrating how the entrepreneurial process can transform a business opportunity into a
business idea
- demonstrating a sense of reality when transforming business idea into action.
Teaching
At the start of the semester, there will be an introduction to the sequence of course activities and
planned progression. There will also be an introduction to the main topics of the course listed above.
13
The students will be divided into groups on the basis of any wishes expressed in advance and
professional background. Classes will take their starting point in the presentation of the students’ own
projects. Time will be allocated to preparation of a group project, to be supported, among other things,
through feedback workshops.
Active participation is expected in all activities, presentations, group work and workshop meetings
throughout the semester.
Performance measurement; qualifications and competences
The course gives the students a profound insight into the skills related to analysis and interpretation of
business areas and an ability to spot and create opportunities for developing new business ideas. The
course also gives the students an insight into their own strengths and weaknesses, to identify any
competences the students may need but not possess themselves.
Creativity and innovation are key concepts for developing ideas, and critical and analytical methods
essential for evaluation of the sustainability of ideas. These elements will also form part of the course;
and finally the course will encourage and develop the students’ competences within cooperation and
communication.
Evaluation criteria:
A description of grade 12:
The student demonstrates extensive and profound knowledge of the subject and/or extensive and
profound skills relating to the subject. As this is a course for entrepreneurship, and not in
entrepreneurship, great importance will be attached to extensive knowledge of concepts and methods
and, not least, extensive skills in applying such concepts and methods.
The student must be able to compare or combine concepts, methods and information in a mature and
realistic way, and apply his/her knowledge/skills on known problems in a highly confident way, and as
far as unknown problems are concerned, by combining knowledge acquired and well-known principles
in such a way that realistic potential solutions are produced.
Description of grade 2:
The grade 2 means passed – just. The grade is given for an adequate performance which
demonstrates that the student has fulfilled the minimum requirements for understanding, knowledge
and skills for the report to pass.
The ability to combine concepts, methods and skills is at a very modest level. No attempt has been
made to establish realism in the report (i.e., there is lack of practical considerations), and no attempt
has been made to enlist the help and support of complementing competences.
Recommended literature
to be announced later.
In addition to text books, an electronic compendium of articles will be made available via the library and
CampusNet.
Exam form
A group report of max 15 pages per person. Each student will be examined individually in the report
and in the course curricula in general.
One overall grade will be given.
14
APPENDIX 2. Introductory letter 2007
Aarhus, 21 August 2007
For the students enrolled in the course
” Entrepreneurship – opportunity to action – the entrepreneurial process” Autumn 2007
Dear Student
Classes will be held according to the following plan:
Tuesdays from 12.00 to 13.40 in room M104 during weeks 36-44 (week 42 autumn holiday)
Tuesdays from 8.00 to 9.40 in room M205 during weeks 45-50
Classes may, however, be cancelled some weeks, e.g. to allow time for longer workshop activities. A
detailed plan will be put on CampusNet later.
This course is designed as a course primarily in or for entrepreneurship; it is, however, also a
theoretical course on entrepreneurship. You will be given an introduction to the subject area and
theories on entrepreneurship; but for most of the course you will be expected to work independently.
That is to say, you are expected to work with your own ideas in a way which makes you able to act
more entrepreneurially in your everyday life. The role of theory in this process is to encourage you to
reflect on your own work in relation to entrepreneurial processes.
It is part of the aim of this course that you work in a group on a project chosen and designed by the
group itself.
The participants are expected to form groups of a maximum of 4 persons, and ideally group formation
should be based on shared interests and goals. Participants who have not found a group by the start of
the semester will be expected to join one in the course of the first two weeks.
To learn more about your intentions and reasons for enrolling in this course, I would like you to reflect
on the following:
Are you primarily interested in entrepreneurship as a theoretical phenomenon – ie, are you interested
mainly in the aspects of the course focusing on entrepreneurship? This interest can have different
starting points: it can be an economic-theoretical interest in the role of the entrepreneurial function in an
economy, or it can spring from a psychological-sociological interest in the particular type of person
driven by spotting new opportunities.
Are you primarily interested in entrepreneurship as a personal phenomenon – and therefore mainly
attracted to the aspects of the course relating to ” in” or ”for” entrepreneurship? Perhaps you have
certain entrepreneurial ambitions but feel you lack something before you dare take the plunge? This
could be something very concrete such as knowledge on how to draw up a business plan for an idea
you already have – or it could be something less concrete, such as a sense of lacking a framework
within which to narrow down the potential business opportunities to pursue.
15
And finally your may be motivated by certain specific interests, which can also take many different
forms – such as an interest in the interface between entrepreneurship and finance – or between
entrepreneurship and the new (experience) economy – or potential interfaces between
entrepreneurship and aesthetics or other non-economic activities – or something entirely different.
I would like to learn a bit more about your reasons for taking this course before our first meeting on 4
September - specifically in relation to the above. Would you therefore be kind enough to send me ½ to
¾ of an A4 page on your reflections? Please mail it to the mail address below no later than 1
September.
Your input will be used to prepare the introductory meeting on 4 September, but also to form groups
whose participants share the same goals for their learning outcome of the process. (I would prefer as
many groups as possible to be established prior to our meeting on 4 September).
The exam in this course involves writing a group project report followed by an oral exam, cf the rules
for this type of exam. As you may know, the rules now call for an individual oral exam; more about that
at our first meeting.
If you have any question before we meet on 4 September, do not hesitate to contact me at the mail
address below.
When you send in the page with your reflections, please make sure to include the following information:
Full name:
Specialized study abbreviation (such as mar, sol etc):
Has previously followed entrepreneurship courses: no / yes - If yes: please specify:
Enrolled at (only if other than ASB):
Yours sincerely
Associate Professor
Poul Dreisler, PhD
Aarhus School of Business /
University of Aarhus
Department of Management
[email protected]
Literature for the course:
Hougaard, Søren: Forretningsidéen – om iværksættelsens tidligste faser. Samfundslitteratur, seneste
udgave. (The business idea – The early stages of entrepreneurship, Springer Verlag 2005)
Rae, David: Entrepreneurship – from opportunity to action. Palgrave Macmillan 2007
In addition, extracts from books and links to articles for use in the classes are available on CampusNet
(under shared folders)
16
APPENDIX 3 a.:
Plan for:
Entrepreneurship – opportunity to action – the entrepreneurial process
APPENDIX NO 3 b.:
Plan for:
Entrepreneurship – opportunity to action – the entrepreneurial process
WEEK no DATE THEME TEXTS PRESENTATION
group no / name
PARTICIPANT ACTIVITY
36 4 Sep Introduction /
Formation of
groups
Intro letter and the texts forwarded
Articles on pedagogy and
sequencing of activities:
Shane: A general theory of…
Poul Dreisler
Formation of groups and
scheduling of the
semester’s activities
37 11 Sep Cancelled:
conference in
Cambridge
Cancelled Cancelled Field and project work
38 18 Sep I.1 Individual
Attributes /
Networks
Hougaard: chap 1
Sarasvathy: What makes ….
Rae chap 2
3 / the teamsters
6 / spezialisterne
Presentation and class
discussion based on own
interest and understanding
39 25 Sep I.2 Individual
Attributes /
Networks
Burt: The Network Entrepreneur…
Forbes et al: Entrepreneurial team
formation
Rae chap 3
7 /The Tertius
9 / ASB_MVP
Presentation and class
discussion based on own
interest and understanding
Handing in theme report I
40 2 Oct Cancelled: project
meeting in Rostock
cancelled Cancelled Field and project work
41 9 Oct II.1
Entrepreneurial
Opportunities /
Discovery
Hougaard: chap 2 & 3
Sarasvathy et al: Three views of
entrepreneurial opportunity.
Rae chap 4
5 / M
12 / SCD
Presentation and class
discussion based on own
interest and understanding
42 16 Oct Autumn holiday Autumn holiday Autumn holiday Autumn holiday
44
30 Oct The Halfway
Presentation
Own work All Presentation and
discussion of
halfway report
4 lessons
45 6 Nov III.1 Opportunity
Exploitation
Hougaard chap 4 – 6
Rae chap 5
4 /Inno-teach
2 / SMB
Presentation and class
discussion based on own
interest and understanding
46 13 Nov III.2 Opportunity
Exploitation
Abell: chap 1, 2, 7
Dimov. Dimo: From opportunity
insight to Opportunity Intention.
8 / 3E
10 / SuLo
Presentation and class
discussion based on own
interest and understanding
47 20 Nov IV.1 Execution Hougaard: chap 7-8
Rae chap 6 + 7
13 / no name
14 /kampusians
Presentation and class
discussion based on own
interest and understanding
48 27 Nov IV.2 Execution Rae chap 8 + 9
Cherwitz et al: Intellectual
entrepreneurship
?
?
Presentation and class
discussion based on own
interest and understanding
49 4 Dec Presentation and
evaluation
Own works All Presentation and
evaluation
17
Literature:
In addition to the literature mentioned above, notes etc will be available on CampusNet. Participants
are also expected to make any electronically produced slides or PowerPoints available in the folder
carrying the relevant week number
APPENDIX 4. Explanatory notes on participant activities and report
requirements
The course is designed to include in principle three different fields of participant activity:
The group’s work on its own project
The group’s work in relation to presentation and classroom discussion
The group’s work writing theme report/halfway report and exam report
Own project. The group is to draw up a project for the semester’s work as soon as possible. The
group can choose to let their project follow the entire entrepreneurial process as described in the plan
(from idea to invoice). Or it can choose to investigate only parts of this process, e.g. the process up to
and including the identification of opportunities but no further. It is also possible to choose one’s own
firm and use it as a case, working on any elements in need of an in-depth investigation. The group is
expected to have finally formulated its project by the end of September.
Presentation. Each group will present some of the literature appearing from the plan, (if possible) of
their own choice. The group is expected not merely to give a summary of this literature but to relate the
literature in question to their own project. To ask – and answer – questions such as what is of particular
interest in relation to our project? Can we use it for our project; does it raise any questions in relation to
our project? As can be seen, the literature is supposed to help and support work on the
practical/theoretical project. It goes without saying that all the students are to have read the same
literature, to be able to engage in a meaningful discussion of it in class. The presenting group is
expected to prepare questions for discussion, using as a starting point any aspects that they find
difficult to understand, or which they find interesting per se, and in particular in relation to their own
project.
Theme report. At the end of theme 1, the group is to upload one A4 page explaining in key words how
their own project is progressing, relating their project to the theme just completed (please see the folder
THEMEREPORT on CampusNet) no later than Friday in the week the theme ends. In the following
week, there will be a brief follow-up review of the papers submitted.
4 lessons
50 11 Dec Q&A and
discussion
On request On request Q&A / consultation etc.
51 18 Dec
Uploading of
group report
Group report to be uploaded in the
folder GROUPREPORT on
CampusNet
ALL
18
Halfway report. No later than on Friday in week 43, the group is to upload a 5-page report on its
project, outlining its current status and schedule for the work still to be done. This report is to be
presented in week 44 (see the folder HALFWAYREPORT on CampusNet).
Group/exam report. This report constitutes the group’s final exam report. Each student is to write 10-
12 pages, the report amounting to a maximum of 50 pages, including any appendixes. The exam form
has been changed as of 1 September 2007.
The report must include the following items:
a) An outline of the topics the group has chosen to focus on
b) The presentation of the project, including relevant documentation (elaboration)
c) An account of the group’s reflections on the link between their project and the theories covered
in the course. This account may also be included under item b
d) A brief account of the group work process. This may be in an independent section or it can be
an integrated part of item b.
The importance (ie, the weight) attached to the individual parts should be approx: item a 15%, b and c
70%, and d 15%.
Exam form. The nature of this course obviously prohibits the traditional series of lectures cum 4-hour
written exam. The exam instead involves a written group report to act as documentation for the work
carried out, including proof of the group’s reflections on their own work during the process. Great
importance is attached to reflection in this course; the participants must reflect on the choices made
during the process. In order to live up to the requirement that exams must be individualisable, the
uploaded group report forms the basis of the oral exam. Each member of the group is examined
individually in the report. Both the report and the individual oral exam will be included in the evaluation
resulting in the exam grade.
Poul Dreisler
19
APPENDIX 5: e-compendium
Articles and extracts from books
Landström, Hans. (2005).
Chapter 2: The Emergence of An Academic Field.
In: Pioneers in Entrepreneurship and Small Business Research, 1st ed. 2005. Corr. 2nd printing, 2005,
pp. 27-57.
Springer
Abell, Derek F. (1980).
Chapter 1: The problem of defining a business.
In: Defining the business. the starting point of strategic planning, pp. 3-10.
Prentice-Hall
Abell, Derek F. (1980).
Chapter 2: Clues from existing theory.
In: Defining the business. the starting point of strategic planning, pp. 11-25.
Prentice-Hall
Abell, Derek F. (1980).
Chapter 7: A theory of business definition.
In: Defining the business. the starting point of strategic planning, pp. 169-190.
Prentice-Hall
Spinosa, Charles, Flores, Fernando, and Dreyfus, Hubert L. (1997).
Chapter 2: Entrepreneurship: The skill of cultural innovation.
In: Disclosing new worlds. entrepreneurship, democratic action, and the cultivation of solidarity, pp. 34-
68.
MIT Press
Burt, Ronald S. (2000).
Chapter 12: The network Entrepreneur.
In: Swedberg, Richard: Entrepreneurship. the social science view, pp. 281-307.
Oxford University Press
Shane, Scott. (2003).
Chapter 1: Introduction.
In: A general theory of entrepreneurship. the individual-opportunity nexus, pp. 1-11.
Edward Elgar
Ardichvili, Alexander; Cardozo, Richard & Ray, Sourav. (1-1-2003).
A theory of entrepreneurial opportunity identification and development.
In: Journal of Business Venturing, Vol. 18, Iss. 1, pp. 105-123.http://www.baser.dk/login?url=http://www.sciencedirect.com/science/article/B6VDH-46RDDDP-
2/2/70fe5b8fb76667b696c806015d5bde9d
20
Dimov, Dimo. (2007).
From Opportunity Insight to Opportunity Intention: The Importance of Person-Situation Learning Match.
In: Entrepreneurship Theory and Practice, Vol. 31, Iss. 4, pp. 561-583.http://www.baser.dk/login?url=http://www.blackwell-synergy.com/doi/abs/10.1111/j.1540-
6520.2007.00188.x
Forbes, Daniel P.; Borchert, Patricia S.; Zellmer-Bruhn, Mary E. & Sapienza, Harry J. (2006).
Entrepreneurial Team Formation: An Exploration of New Member Addition.
In: Entrepreneurship Theory and Practice, Vol. 30, Iss. 2, pp. 225-248.http://www.baser.dk/login?url=http://www.blackwell-synergy.com/doi/abs/10.1111/j.1540-
6520.2006.00119.x
Cherwitz, Richard A. & Sullivan, Charlotte A. (2002).
Intellectual entrepreneurship: a vision for graduate education.
In: Change, Iss. November/December, pp. 22-27.https://webspace.utexas.edu/cherwitz/www/articles/change.pdf
The article can be found at the page with selected IE Publications
Papers:
Sarasvathy, Saras D. (2001)
What makes entrepreneurs entrepreneurial?
Paper from University of Washington,
School of Business
Pp 1-9.
To be found at this homepage:http://www.effectuation.org/
Sarasvathy, Saras D.; Nicholas Dew; S. Ramakrishna Valamuri & Sankaran Venkataraman (2002)
Three views of entrepreneurial opportunity.
Paper from University of Washington,
School of Business
Pp 1-34
Invited book chapter in the Entrepreneurship Handbook edited by Acs et.al.
(Revised February 1, 2002)
To be found at this homepage:http://www.effectuation.org/ ?Effectuation Research? For a complete
bibliography, organized by year, click here.?2000
8. Support material - Questions and Answers
What is the overall problem(s)/issue in this case?
That it turned into just another educational activity, too similar to other courses. The absence of the
more dynamic environment enjoyed before is sadly felt. Business school students need inter-
disciplinarity, which is no longer present in the course; the students themselves are, however, required
to establish inter-disciplinarity in their project. The individual oral exam is a huge problem.
21
What are the factors affecting the problem(s) related to this case?
Professional disagreement, personal and institutional rivalry etc. In spite of highly motivated and
involved students, the subject area does not enjoy a high status at the universities. Universities reward
research, not educational development. Lack of close contact with the environment. A question of the
teacher’s position on the PLC curve.
Discuss entrepreneurial didactical, pedagogical and organizational issues and resources
related to this case.
Misses the previous concrete cooperation with the many and diverse research-park and innovative
activities in Aarhus. Participants too tied down by time schedules. They work hard, but (after 4 years)
they are still not sufficiently prepared for independent studies. All things considered, the course is
progressing well. Probably too structured, though. Major emphasis is attached to the participants’ own
work.
What role do different players (trainers, policymakers) play in the overall planning,
implementation and management of the entrepreneurship education effort and applications?
The section Background for the case has already dealt with this issue. Politicised agendas have had a
lot of influence. Changing, though, after administrative reform of local government. The jungle of
financial support schemes has led to sub-optimisation. Entrepreneurship is a buzz-word used (and
abused) by lots of players. Everybody wants a piece of the action, with the notable exception of the
universities. The pracademic spirit has not been able to change the ”ivory tower” attitude.
What are the possible alternatives and pros and cons of each alternative facing the organization
in dealing with entrepreneurship practice and the learning goals related to the case?
Many entrepreneurship activities take place ”outside” the university system, but it is obvious that similar
activities could just as easily be established ”within” the system, if there was a wish to do so. To
mentioned a few examples: Stanford, Department for Engineering and University of Seattle have
established internal centres for entrepreneurship, functioning along much the same lines as those
found in Denmark outside the system, and struggling to survive.
What are some of the alternative approaches that could be considered in achieving the learning
goals related to the case?
Time and incentives should be given to teachers who build up learning networks as the basis for their
teaching. The students should take over and take part in the network as their study and work field. This
happens in various shapes at some of the newer universities, but not everywhere. The advantage is
that knowledge and competences are spread to many more than the students themselves.
What recommendations can be made to the educational staff, policy makers or management of
the organization described in the case? Provide your arguments in support of the
recommended solution.
The universities must make up their minds whether they wish to stick to the ivory tower spirit or to
realise an entrepreneurial university vision. If they chose the latter, they must develop learning
programmes in which knowledge and application of knowledge are given equal weight (mutual
knowledge and competence creation). Establish networks including business and ”outside” actors.
Make inter-disciplinarity a requirement and organise according to a contingency principle. That is, in
each specific situation consider and choose the most sensible line of action.
22
9. Epilogue and lessons learned
This has been written as a response to the evaluation of outputs and outcomes at the completion of the
BEPART project on 2-3 October 2007 in Rostock. But what I have written is also based on my
experiences over 20 years in the subject field. Apart from BEPART, I have been involved in a number
of projects on entrepreneurship:
• Together with two colleagues, I have written extensively on a theme we have called
“Entrepreneurship Education – the New Challenge Facing the Universities. A framework for
understanding and development of entrepreneurial university communities”
• I have served as a member of a working group on ”How to implement entrepreneurship in the
Danish educational system – from kindergarten to PhD”.
• I have been involved in projects to include entrepreneurship in the Danish folk high school
movement
• I am one of the founders of Centre for Entrepreneurship and served as a co-leader for almost
three years
• I was involved in the foundation of IDEA (International Danish Entrepreneurship Academy)
• I have been responsible for the teaching of subjects related to all aspects of innovation and
entrepreneurship from 1989 to 2007
• plus a host of other activities.
If we look at this particular subject area from a general, overall perspective, it is characterised by a
number of special circumstances not found when developing courses etc in connection with other
subject areas. Some of the special circumstances surrounding entrepreneurship are:
• The development of entrepreneurship constitutes a battlefield, involving politicians, institutions,
teachers, administrators and many others
• Public grants for the area are often seen as short-term investment, expected to yield high
returns within a very short timeframe
• The subject area has yet to find its place at universities, a place where it can develop
organically and in accordance with its own logic
• Public funds are usually given to institutions outside the university sector or to special centres
or initiatives attached to universities
• Concepts like entrepreneurship, creativity and innovation have acquired a status as catch-all
mantras in the school system (primary and secondary)
• University teachers are not rewarded for working with the subject area or given enough scope
and funds to experiment. Instead external ”consultants” are typically brought in
• When discussing experiences of including the subject area in their educations, many teachers
use the word ”resistance” (I heard the word used repeatedly at the conference in Cambridge in
summer 2007)
• - just to mention a few of these special circumstances.
The lessons to be learned from this (and indeed the lessons learned through the project BEPART) is
that we have to be more specific when we use the concept entrepreneurship and define it in terms of
the time, place and level at which we wish to implement it. We need to bear in mind that the concept is
23
used in so many different interpretations and definitions that we should avoid using it as a course name
in our educations.
As part of our educational systems, the concept Entrepreneurship has become its own worst enemy.
Educations within this subject area are usually turned down by the system, and therefore organised
outside it.
We need to define the concept as a process for students in all subjects at our universities, meaning
that ”the entrepreneurial university” should become the specific goal in the sense that the university
offers educations in ”enterprising / entrepreneurial behaviour”, teaching students to create value for
society by using their knowledge and competences alone or, in most cases, in combination with other
competences.
Entrepreneurship and similar subjects should not be taught to a few highly motivated classes or groups
of students; it needs to be implemented as a study form in subjects like technology, sciences and
humanities, and in all other subject areas.
And we should never ask children in primary and secondary school to sit still and listen to lectures on
entrepreneurship, creativity and innovation. We must encourage and not spoil their inborn talent for
these behavioural elements. That is why it is a big mistake that the subject field has now been taken up
at teachers’ training colleges, demanding these concepts to be added to the curriculum.
At universities, we have to look at entrepreneurship as processes and new pedagogical forms, trying to
combine academic theory and practice in such a way that new knowledge is created where the spheres
meet, and knowledge becomes the basis for the creation of value, for both the student and society.
There is a concept called an ”intellectual entrepreneur”. This refers to a student who, just like a
scientist, is always prepared to take a risk, constantly looking for opportunities to work together with his
or her surroundings, outside the classroom. This is the philosophy behind a master programme at
Texas University in Austin, USA.
”The philosophy and practise of intellectual entrepreneurship serve as a catalyst, allowing students to
identify opportunities to put their training and expertise to use in creative and innovative ways, whether
in business or scholarship.” (Cherwitz, R.A. & Sullivan, C.A. 2oo2). And to add a couple of other
quotes:
“…to succeed in entrepreneurial capitalism, everyone must learn to be entrepreneurial in any setting”
(Carl Schramm, President of the Kauffman Foundation), and
”More and more it is clear that entrepreneurship is a style and general method of operating and not just
a set of business skills.”
(The Colemann Foundation).
24
A Case of Teaching Business Planning
at Tallinn School of Economics and Business Administration
Tallinn University of Technology
1. Learning Goals
The students:
- realise the importance of preparing a business plan to minimise risks involved in
starting a new business;
- gain an overview of the Business Plan structure and preparation process;
- get accepted definitions of various Business Plan terms;
- get some practice for writing a Business Plan on the basis of their own business idea.
2. Executive summary
This chapter is demonstrating a case of teaching Business Planning at Tallinn University of
Technology for students of technical specialities.
The aim of the course is to develop the basic knowledge and skills on entrepreneurship,
particularly on business planning process starting from business idea generation, finding and
evaluating business opportunities up to calculating financial reports of the business. The main
principles, rules, processes and methodological approaches on the level of enterprise are to be
explained. A business plan will be completed at the end of the semester on the basis of
students’ own business ideas.
The teacher’s main tasks are:
- to provide theoretical knowledge on entrepreneurship, business planning and business
administration;
- to instruct the students to find and test business ideas, and assess the business
opportunities;
- to consult group work and writing business plans;
25
3. Background
Programmes of most of the technical specialities at Tallinn University of Technology include
economic subjects such as macro- and micro economics and business administration or
business planning. The subject of business administration also contains business planning as
the main part. The programmes of both subjects envisage that students prepare a business
plan as an independent work task. These subjects are obligatory for the mentioned target
groups. Every year over 200 students take this course.
The classroom lessons are conducted in rooms equipped with a media projector and other
needful facilities.
Two teachers are involved. While one teacher is responsible for raising the students’
awareness and providing knowledge on theoretical side of entrepreneurship, business planning
and business administration via lectures and discussions on relevant subjects, the other
teacher is responsible for consulting students on business planning and writing business plans
as well as their independent homework in the same issues.
4. Case description
The volume of the subject is 2.5 credit points and 48 hours of classroom lessons including 32
hours of lectures. One third of the total volume of the subject is independent work. The purpose
of the large number of students and relatively small number of classroom lessons is to seek
teaching methods that would provide the students with a comprehensive overview of
entrepreneurship and business administration and an opportunity to acquire knowledge on
what one must need to know of planning one’s own business and how to write a business plan.
Theoretical lectures and principal discussions take place in large rounds (app. 70-150
students), but practical work of preparing business plans is conducted in practical classes in
smaller rooms (app. 10-20 students). Development of a business idea and writing of a business
plan carried out as a group work (app. 2-4 students).
The target group is primarily master’s students in technical specialities, e.g. mechanics,
chemistry, information technology, mathematics and natural sciences, power engineering,
logistics etc. Depending on the economic subjects in the curricula of these specialities, two
different level groups can be distinguished. On the basis of this, logistics students have this
subject already on the bachelor level with focus on business planning, taking into consideration
their previous knowledge about marketing, management, accounting etc. fields of economics.
Knowledge of students of other specialities about economic subjects are limited only to micro
and macroeconomics. They learn in greater detail the terms of entrepreneurship and business
administration and in parallel are introduced to the business planning process.
In classroom lessons all theoretical issues are explained and the use of active teaching
methods and the involvement of students in the classroom work is largely limited due to the
large audience. Hence, students listen to a lot of theoretical material in lectures, which is
supplemented with many cases and examples and which can be discussed in a large
audience. Classroom lessons also discuss methodical methods that can be used in practical
independent work outside the classroom (e.g. market research, collection of information on
competitors, raw material and financial sources, etc.). In practical lessons discussions are held
26
in smaller groups in different business planning subjects and teachers consult development of
business ideas found by the students and writing of business plans.
Additionally, the subject is provided with the e-learning environment (Moodle) where the
students find the lecture materials, as well as instructions for practical work and tasks. The
teachers and students can communicate, ask questions and have a discussion in the forum.
Contents of the subject Enterprise Economics. Business Planning
The content of the course:
I Lectures
1. week. Introduction to the course. Business idea generation. Overview of the process
and structure of business planning.
2. week. Recognition and evaluation of business opportunities. Entrepreneurship,
entrepreneur, enterprise. The psychological portrait of the entrepreneur.
3. week. The mission, vision and aims of enterprise, business definition. Internal and
external environment of enterprise.
4. week. Main principles of marketing. Market research.
5. week. Product and price policy. Planning marketing policy.
6. week. Strategic analysis and development. Sales strategy and methods.
7. week. Business organisation and its legal forms. Non-profit organisations.
8. week. Establishment of a new enterprise, independent study on the basis of website
www.aktiva.ee .
9.-10. week. Accounting and recording. The structure of expenditures and accounting
methods. Calculating net costs. Profit statement. Cash flow prognosis. Balance.
11. week. Cost-benefit analysis
12.-13. week. Financial management and analysis. Time value of money. Investment
budgeting.
14. week. Entrepreneurship policy and business support system.
15. week. Entrepreneurship policy in Europe and measures for promoting SMEs.
16. week. Entrepreneur as a guest lecturer. Experience and suggestion on business start-
up and business development issues.
Practical lessons, workshops
All theoretical knowledge on business planning and enterprise’s economic activity, as well as
methods for preparing a business plan and calculations are presented in lectures. In practical
lessons results of independent work are discussed and consultations conducted.
1. Consultation via e-mail or forums in issues of independent work: searching for and
choice of a business idea, market research, analysis of factors that influence demand,
collecting information on competitors in the first practical classroom lesson.
Independent work according to instructions and lecture materials in the e-study
environment: conceiving and testing a business idea; evaluation of factors that
influence demand; comparative table of competitors.
2. Discussion of the results of independent work in the development and implementation
of a business idea: presentation of a business idea in groups, factors that influence
demand, overview and comparative analysis of competitors; questions and answers.
3. Classroom consultation in general part of business plan related issues/problems;
4. Defence of the general part of business plan with product/service pricing
5. Consultation via e-mail in business plan related issues/problems.
6. Classroom consultation in business plan related issues/problems.
27
7. Seminar: analysis of cases/problems encountered in enterprises and finding solutions
to them
8. Defending of business plans.
Examination of knowledge: The course will end with a written examination. A precondition of
admitting to examination is a timely submitted and positively defended business plan. The
examination result is to the extent of 50% determined by the written examination and to the
extent of 50% participation in classroom work and business plan mark. During a session all
those who satisfy the preconditions are admitted to examination.
Current challenges/problems facing the organisation/project experience or educational
effort
The biggest problem is that at a time the subject must be taken by a large number of students
as an obligatory subject, which sets limits to using different active forms of teaching. Still, a
quite suitable form for teaching large groups has been found in this case: the theoretical part in
the form of lectures in a large group and practical lessons in smaller groups are synchronously
combined and take place under the guidance of two teachers in parallel. The support of e-study
helps a lot; it is a supplementary source of information for the students and a means of
communication between themselves and with teachers. Learning of the subject is also
facilitated by the website provided by the entrepreneurship support system, which contains
examples and cases of lessons of from the life of enterprises in the business environment, and
recommendations to other entrepreneurs.
5. Further reading
Hougaard, S. (2005). The Business Idea. The Early Stages of Entrepreneurship. Springer
Immink, R., O’Kane, B., Owens, T. (2002). Starting Your Own Business. A Workbook. Oak
Tree Press.
Shane, S. 2003. A General Theory of Entrepreneurship. The Individual-Opportunity Nexus.
Series: New Horizons in Entrepreneurship, University of Virginia, Edward Elgar.
Timmons, J.A. 1999. New Venture Creation. Entrepreneurship for the 21st Century. Irwin
McGraw-Hill, USA;
Kallam, H., Kolbre, E., Lend, E., Möller, L., Reinhold, V., Simson, A., Uustalu, A., Venesaar, U.
(2003) Ärikorralduse põhiteadmised.
Külim, Tallinn;
Ettevõtja infovärav – www.aktiva.ee
Ettevõtja käsiraamat (Äripäeva käsiraamat).
28
6. Support material
Since cases accepted for publication are considered to be teaching and educational cases, we
expect many academicians to utilize these studies in their information system courses. In
consideration of this, we ask that in addition to your completed case study, you also provide
three teaching aids:
1. A list of questions and answers for your case
2. An epilogue and a list of lessons learned; and
3. A list of resources for further study.
Ad (1). Questions and Answers
Please prepare a list of 5-7 questions relevant to the issues, problems and challenges
discussed in your case. Then provide a concise paragraph of 30-50 words in answer to each
question. Feel free to create your own questions or use and adapt the sample questions listed
below.
• What is the overall problem(s) issue in this case?
• What are the factors affecting the problem(s) related to this case?
• Discuss entrepreneurial, didactical, pedagogical and organizational issues and
resources related to this case.
• What role do different players (trainers, policymakers) play in the overall planning,
implementation and management of the entrepreneurship education effort and
applications?
• What are the possible alternatives and pros and cons of each alternative facing the
organization in dealing with entrepreneurship practice and the learning goals related to
the case?
• What are some of alternative approaches that could be considered in achieving the
learning goals related to the case?
• What recommendations can be made to the educational staff, policy makers or
management of the organization described in the case? Provide your arguments in
support of the recommended solution.
Ad (2). Epilogue and Lessons Learned
Please provide an epilogue paragraph in which you discuss the long-range effects of your
case. Do not include an epilogue in your actual case study. Next, provide a list of 3-5 lessons,
along with a concise explanation of each, that in your opinion can be learned from your study.
Ad (3). List of Additional Sources
Please prepare a list of other resources (e.g., journal articles, books, Web sites) that might be
relevant for obtaining additional information either directly related to or similar to your case.
List any industries where the described case may be pertinent.
29
Master Program in
Entrepreneurship and Technology Management:
Evaluation of the Successful Initiative in Estonia
Janita Andrijevskaja
University of Tartu
Faculty of Economics and Business Administration
1. Introduction
Wide range of universities and colleges has been recently investing in developing programs in
entrepreneurship and technology management. Striving for entrepreneurial knowledge
economies and supported by strong political support, many institutions have successfully
introduced either technology management or entrepreneurship curricular. However, there are
rather few examples of successful integration of both subjects.
University of Tartu (Estonia) has been the first university in the Baltic States to integrate
entrepreneurship and technology management in a master program curricular. The program’s
objective is to provide modern and applicable knowledge in entrepreneurship, innovation and
technology management. Oriented on that, the master program’s long-term mission is to
support Estonian companies in their becoming more innovative and technology oriented.
Started in 2002, the program has yet a short operating experience and might have some
challenges to overcome, nevertheless it is clear - this initiative does have a strong demand in
Estonia. The objective of the present article is not only to describe the program, but also
evaluate the extent to which the Master Program succeeds in providing modern and applicable
knowledge in entrepreneurship, innovation and technology for the managers of small high-tech
companies. The reason for focusing on small high-tech companies is that managers of these
companies are considered one of the main target groups for the program.
The content of this article can be useful for the institutions that are planning to launch
interdisciplinary programs on entrepreneurship and technology management (ETM) as well as
for institutions that look for good ideas to improve their program.
30
2. Methodology of the evaluation
To achieve the surveys’ objective, and evaluate ETM master program’s contribution to
strengthening small high-tech companies, the author follows the stages, presented in figure 1.
Firstly, educational “supply side” is presented: the author describes ETM master program at the
University of Tartu and briefly refers to the experiences with entrepreneurship programs in
other countries. Then “the demand side” is analyzed: the needs of potential students (i.e. small
high-tech companies) are under discussion.
Figure 1. Structure of the study
Conducting empirical survey, several primary and secondary information sources were used:
interviews with student and programs coordinators, questionnaires and documents on ETM.
Two types of questionnaires were analyzed in this study: survey of students’ general
satisfaction, and alumni questionnaire. The questionnaire of satisfaction encompasses opinions
of majority of students, whereas alumni-oriented questioning was conducted with only 3
students. These students (managers of high-tech companies) are among the first to graduate
from the discussed program. The results and conclusions of the study are presented in the final
part of the report.
3. ETM master program: overview and potential challenges
The master program in Entrepreneurship and Technology Management at the University of
Tartu was first opened for enrollment in 2002. The initial objective of the program coincides with
its present objective - it was to integrate studies in entrepreneurship and technology
management and raise “…entrepreneurial culture in the academic community” (Final…2001).
Launching ETM curricular was a pioneering initiative in Baltic States: up to present, there is no
other institutions neither in Estonia nor in other Baltic States that run similar program.
The program was developed by international team of four people: prof. Tamkivi and prof.
Karelson from Estonia (Tallinn University of Technology), prof. Formica and Lex de Lange from
the Netherlands (Zernike Group). All of them belonged to the International Association of
Science Parks – the organization through which mentioned above people got acquainted. The
advantage of the initiative group was a good knowledge of technology management (Tallinn
University of Technology) and extensive entrepreneurial experience (Zernike Group). Both
knowledge and experience was helpful in applying for PHARE funds to develop the curricular in
details.
Overview of ETM
program
Chapter 3
Needs of ETM
students, satisfaction
Chapter 4
Final results,
conclusions
Chapter 5
1. ETM master
program at the
University of Tartu
2. Potential challenges
Sources of information: 1. Interviews with ETM students.
2. Questionnaires. 3. Reports and other documents. 4 Articles
Small high-tech companies
in Estonia and abroad:
educational needs
Evaluation of the
program’s match
against students’
needs:
1. Courses
2. Thesis writing
Recommendations
31
The general data on the ETM master program presented in table 1 was planned back in 2001
and is also valid nowadays. After introduction of the curricular, a 4-member council for ETM
program development was formed, consisting of two professors and two students’
representatives. The council was to initiate changes in the program. The structure of courses
(presented in Appendix) has changed insignificantly over the last 3 years, that can be a sign of
a good planning: prior the introduction of ETM program, numerous interviews were conducted
with potential ETM students to identify educational needs of the target group.
Table 1. General data on the EMT master program at the University of Tartu
Criteria Description
Nominal study time 2 years
Volume of the program 80 credit points (CP) or 120 CP according to ECTS
Entrance criteria Bachelor degree in natural sciences, engineering, economics or social
sciences
Structure of the program 56 CP for ETM obligatory and non-obligatory courses
20 CP – Master Thesis
4 CP – courses under other faculties
Groups of ETM courses 1. Entrepreneurial environment
2. Technology policy and management
3. Legal issues
4. Human resource and communication
5. Marketing and sales management
6. Financial planning and control
Study time schedules Classes once a month, over long weekends: Thursday through Sunday
Number of enrolled
students
2002 – 25 students; 2003 – 30 students, 2004 – 35 students
As planned, the ETM master program gained international and interdisciplinary character from
the very first days of its establishments. Not only teachers from Estonian universities taught
ETM, but also experts from Zernike Group (The Netherlands), International University of
Entrepreneurship (The Netherlands), and Michigan Technological University (USA).
The target group of the Master program is specialists who have received Bachelor degree in
the fields of natural sciences, engineering, economics or social sciences. When selecting
applicants the priority is given to students with educational background from natural sciences
and engineering; another priority’s criteria is managerial experience and strong motivation for
entrepreneurial activities of a student.
Being launched in 2002, the master program’s nominal study time was 2 years, thus in the year
2004 the first four students have graduated from the faculty. By July 2005, six more students
are expected to obtain ETM Master Diploma. Also in the 2005 the program will go through the
accreditation process at the Estonian Ministry of Education.
In the following part of the chapter the problems of entrepreneurial education are briefly
discussed based on the experience reported from countries with advanced economies. It might
be expected that Estonia, having only 15 years of democratic, market-driven economy can face
the same problems while developing programs for entrepreneurial education.
32
According to the European Commission’s report (Final…2001) the major problems related to
entrepreneurial education are the following:
1. Entrepreneurship programs are not supported on political level, and are weakly
integrated into educational system.
2. The evaluation system of entrepreneurship education is inadequate.
3. At universities, entrepreneurship is mostly taught to business students.
4. Teachers are not sufficiently trained to become entrepreneur.
5. Weak relations among universities and business sector diminish effectiveness of
teaching entrepreneurship.
The presented long list of problems indicates, that not only it might be difficult to launch the
problem (lack of experience, lack of political and financial support), but it also challenging to
insure good quality of courses, their correspondence to the needs of entrepreneurs.
Indeed, even the United Kingdom, country known for pro-business environment, high-quality
MBA and entrepreneurship programs, is criticized for inefficient entrepreneurship teaching
methods. Numerous UK entrepreneurship programs lack structure and clear objectives,
institutions prefer investing in advertising innovative programs rather that raising quality of
curricular. In many institutions the established academic traditions are a serious obstacle for
entrepreneurial programs to be launched, thus new initiatives face tremendous resistance.
(Tiratsoo 2004)
Problems of entrepreneurship and technology management education are discussed by Weller
(1999), who mentions that lecturers often choose specialist approach, not integrating particular
course with other courses, or not integrating theory with business or other type of environment.
Launched in 2002 in Tartu, the ETM master program enjoys growth of enrolled number of
students and favorable public image. Nevertheless, considering the experience of other
countries it might be expected that there are serious challenges facing this pioneering
curricular.
Educational needs of small high-tech companies
After a long period of planned economy, Estonia gained independence in 1991, having faced
the need for restructuring of partly collapsed industries and raising competitiveness of newly
established businesses. Even though the government is trying to improve business
environment in Estonia, there are yet numerous problems that hold ratio of start-ups and
innovative companies at the level below EU average.
What educational needs do small high-tech companies have? Due to the fact, that this question
is not sufficiently studied in Estonia, the experience of other countries is presented here. For
example, survey of Chiesa and Piccaluga (2000) showed that among the most critical issues
for small high-tech companies were finding financing sources, applying right marketing
approach and commercializing the technology (see table 2).
33
Table 2. Major problems of small high-tech companies
Problem
Average rating
(1-unimportant, 5 – critical importance)
Financing 3,58
Marketing, selling,
commercialization
3,10
Evaluation of market’s needs 2,73
Distribution, logistics 2,57
Technical problems in production
and development of product
2,42
Problems with contracts 1,83
Managing human resource 1,78
Problems with business owner 1,62
IPR 1,54
Source: Chiesa, Piccaluga 2000
For many Estonian technology-based companies, local market is too small to operate without
losses, thus it would be necessary for ETM educational programs to include courses on
internationalization. Another important aspect discussed in literature on high-tech small
businesses is a question of employees’ motivation (Nurmi 1998). The biggest value in
innovative companies is often not just technologies, but people, who develop and
commercialize technologies. Retaining and motivating these people can be challenging for
manager, who has no managerial education. Summarizing the discussion above, manager of a
small high-tech company is likely to have interest in the following educational fields: marketing,
sales, internationalization, human resource management. Additionally it is also important to
learn how to manage technology efficiently. These four fields with several keywords have been
presented to several ETM students. The results of discussion - major educational needs
perceived by several ETM students - are presented in the table 3.
Table 3. Educational needs of small high-tech companies’ managers
Field
Educational needs
Practical marketing skills for small high-tech company
Mapping potential market
Cooperation with client, communicational psychology
Marketing in a narrow technological field
Marketing and
sales
Sales and organization of distribution network
Evaluation of commercial potential and viability of a business idea
Creation of a network (finance, marketing, technology etc.)
Patents, IPR
Product
development
Product development, technology transfer
Contracts and international business acts
Getting started in a narrow, but global technology fiel.
Searching and choosing strategic partners
Internationali-zation
Advertising, purchasing decisions etc in various countries
Motivating employees to think in business terms
Teamwork
Teamwork
management
Organizational culture (acknowledgements etc)
Source: Based on interviews with ETM students
34
When asked about writing a Master Thesis at the university, ETM students expressed uniform
opinion the subject for the Thesis need to be closely connected to practical issues, for example,
case-solving approach or writing a business plan. Students did appreciate the time spent
consulting with supervisor and other involved people on problems connected to the thesis.
Thus not only content of curricular is important for students, but also informal communication
with lecturers, professors and motivating and pragmatic requirements for writing a Master
Thesis.
Results and conclusions
The objective of the present article was to present ETM master program introduced at the
University of Tartu and to analyze, to which extent the program corresponds to the needs of
managers of small high-tech companies. The description of the ETM was given in chapter 1,
whereas the program’s match against students needs is to be discussed in the present section.
It is also presented here, what are the major strengths and weaknesses of the program and
what are the opportunities for further development.
ETM master program consists of 26 courses, grouped in 6 modules (see Appendix 1). After the
needs of several managers of small high-tech companies have been identified in the previous
chapter, it is now possible to clarify, to which extent the required education is reflected in the
ETM master curricular (see table 4).
Table 4. Match between educational needs of students and available ETM courses
Field
Educational needs Available ETM courses
Practical marketing skills for small high-tech company Marketing
Mapping potential market Marketing
Cooperation with client, communicational psychology Sales and distribution management
Marketing in a narrow technological field -
M
a
r
k
e
t
i
n
g
a
n
d
s
a
l
e
s
Sales and organization of distribution network Sales and distribution management
Evaluation of commercial potential and viability of a
business idea
Application of technology strategy methods in
business
Creation of a network (finance, marketing, technology etc.) -
Patents, IPR
Intellectual property rights: licensing, protection
of trademarks and products
P
r
o
d
u
c
t
d
e
v
e
l
o
p
m
e
n
t
Product development, technology transfer
Technology transfer; Quality management;
Nanotechnologies etc
Contracts and international business acts Contract and business negotiations
Getting started in a narrow, but global technology field. -
Searching and choosing strategic partners -
I
n
t
e
r
n
a
t
i
o
n
a
l
i
z
a
t
i
o
n
Advertising, purchasing decisions etc in various countries Sales and distribution management; Marketing
Motivating employees to think in business terms Leadership and personnel development
Teamwork -
T
e
a
m
-
w
o
r
k
Organizational culture (acknowledgements etc) Organizational culture
Source: Based on table 3 and ETM master curricular
35
Analyzing the match between students’ educational needs and available ETM courses, it
appears that most of the required fields are covered by the Master Program. The interviews
with students enabled collecting some additional information. Students with non-economic
background appreciated the fact that they could enroll into the program that combines
business, entrepreneurship and technological matters. It is also highly valued that most of the
ETM teachers are professionals in their fields and some of them have also extensive practical
experience.
Dissatisfaction caused the fact that several technology-oriented subjects are poorly connected
to business and entrepreneurship, being more like scientific courses instead. There was also
comment that some of the teachers (mostly local) are reluctant to make courses interactive,
and courses’ information to be more applicable in business. This might be caused by: a)
teachers lack of appropriate training in modern teaching methods, b) traditionally academic
career of several local teachers.
Table 5. Conclusions of the study
Strengths
Weaknesses
Interdisciplinary: technology, business,
entrepreneurship
Local teachers lack ability/motivation to
connect theory with business reality
International network of top-specialists Local teachers use few methods to make
the course interactive
Uniqueness in Baltic States Traditionally academic requirements to
Master Thesis
Sustainable structure of courses Lack of several essential courses
Suggestions
Organize training seminars for current and potential ETM teachers
Add several courses: on psychology, launching new product etc.
Invite practitioners (including ETM alumni) for short-term lecturing
Rethink requirements for the ETM Master Thesis
Strengthen international network and links to practitioners with academic background
Source: compiled by the author
The ETM master program has been developed based on the need of Estonian businesses, and
demand for ETM education is clearly increasing. Even though there are quite a few challenges
ETM program faces, the council of ETM program development works on improving the program
by attracting new partners and raising requirements for ETM teachers. After the accreditation of
the program the discussions will start to prepare English version of the program for
international students.
36
References
1. Chiesa, V., Piccaluga, A. Exploitation and diffusion of public research: the case of
academic spin-off companies in Italy. – R&D Management, 2000, Vol 30, No. 4, pp. 329-339.
2. Ettevõtlus ja tehnoloogia juhtimine: õppekava.Tartu Ülikool. Majandusteaduskond. 2004
3. Final Report of the Expert Group “Best Procedure” project on Education and Training for
Entrepreneurship. November 2002. 58 p. [europa.eu.int/comm/enterprise/entrepreneurship/
support_measures/training_education/education_final.pdf]
4. Final Report on Development of Mater Programme in Entrepreneurship and Technology
Management. 2001
5. Interviewed persons: Dorel Tamm, Tõnis Mets, 3 ETM students.
6. Tiratsoo, N. The “Americanization” of Management Education in Britain. – Journal of
Management Inquiry, Vol. 13, No 2, June 2004, pp.118-126.
7. Weller, M., Dillon, P. Education and Business Partnerships in the United Kingdom: Initiatives
in Search of a Rationale.-Bulletin of Science, Technology and Society, Vol. 19, No1,
February 1999, pp. 60-67.
37
8. Appendix 1
Master Programme in Entrepreneurship and Technology
Management
Credit
Points (CP)
Primary Lecturers/ Tutors *
TOTAL
80 CP
1. Module. Entrepreneurial environment 10 CP
1.1. Entrepreneurship and Innovation, Intrapreneurship 4 CP Prof. P. Formica (IUE)
1.2. Business Strategies. Business Planning, Product and
Service Planning and Development
4 CP M.Sc. E. Vazquez Mu?oz
(IUE)
1.3. Entrepreneurship 2 CP T. Mets (UT)
1.4. Research methodology 2 CP E.Reiljan, U.Varblane (UT)
2. Module: Technology policy and
management
20 CP
2.1. Modern Key Tehcnologies 2 CP M. Karelson (UT)
2.2. Technology and Innovation Polices 2 CP K.Männik, K.Kubo (UT,
Ministry of Economic
Affairs)
2.3. Total Quality Management 2 CP T.Tammaru (TTU)
2.4. Technology Transfer, Technological Expertise 2 CP M. Karelson, (UT)
2.5. Application of Technology Strategy Methods in
Business
2 CP E. Valmra (EAS),
T. Hein (HeiVäl)
2.6. Technologies in the fields of specialisation (electives) Students to
select 10 CP
Modern materials and materials technologies 2 CP J.Kikas (UT)
Nanotechnologies 2 CP R. Jaaniso (UT)
E-commerce 2 CP K. Kerem (TTU), A. Pärl
Software development 2 CP
Information technology policies 2 CP J. Villemson (UT), U. Puus
(Cybernetica)
Business Information System 2 CP V. Leping (UT)
T. Saarsen (UT)
Logistics Management 2 CP R. Jüriado (UT)
Transgenic Technology 2 CP A. Mäe (UT)
Environmental Technology 2 CP Ü. Mander (UT)
T. Tenno (UT)
J. Truu (UT)
Management of Knowledge and Innovation Processes 2 CP T. Mets (UT)
38
3. Module: Marketing and sales management 9 CP
3.1. Marketing (including brand marketing) 3 CP M.Miljan (UT)
A. Brokaw (MTU)
3.2. Sales and distribution management 3 CP D. Dijk (IUE)
3.3. Internationalisation of business 3 CP P. Formica (IUE)
U.Varblane (UT)
T.Roolaht (UT)
4. Module: Financial planning and control 6 CP
4.1. Entrepreneurial Finance 4 CP A.Juhkam (UT)
P.Sander (UT)
T.Haldma (UT)
4.2. Fundraising Process: Grants / Subsidies to Private
Funding, seed Capital for Start-ups
2 CP L. De Lange (IUE), A.
Juhkam (UT)
5. Module: Legal Issues 4 CP
5.1. Intellectual property rights framework, including the
licensing, protection of trademarks and products
2 CP L.A. Stienstra (IUE)
5.2. Project Management 2 CP T.Mets, K. Kaarna (UT)
6. Module: Human recourses and
communication
7 CP
6.1. Leadership and personnel development 2 CP K.Türk (UT)
6.2. Organisation and Organisational Culture 3 CP M.Vadi (UT)
Free courses 4 CP
Master Thesis 20 CP
* used abbreviations: IUE – International University of Entrepreneurship, Netherlands, UT –
University of Tartu, TTU – Tallinn Technical University, MTU – Michigan Technological University
39
Competence-based Entrepreneurship Model
Entrepreneurship Incubators at HAMK University of Applied Sciences
Seija Pajari-Stylman Heikki Hannula
Project Manager Senior Lecturer
P.O.Box 190, 13101 HÄMEENLINNA P.O.Box 182, 13101 HÄMEENLINNA
tel. +358 (0)3 646 3671 tel. +358 (0)3 646 3377
fax +358 (0)3 646 3700 fax +358 (0)3 646 3200
[email protected] [email protected]
Keywords:
Learning, entrepreneurship, competence, incubator
Abstract
Pre- and start-up incubators are used as authentic and simulative learning environments at HAMK
University of Applied Sciences. They can offer the students excellent opportunities to learn
entrepreneurial competences in simulative or even authentic situations. These provide the students with
good learning experiences. For high-quality learning these experiences are necessary but not enough.
The experiences will be reflected on in the action learning sessions.
In this article we first describe the basic assumptions about our thinking of the learning of
entrepreneurial competences. Then we give an example of our learning methods. After that we will
describe learning in pre- and start-up incubators at HAMK University of Applied Sciences as an
example.
40
1. Introduction
HAMK University of Applied Sciences offers high-quality education, research and development services,
and an international atmosphere. Situated centrally in the prime area of southern Finland, HAMK has
units in seven locations with 25 degree programmes and 7000 students. Our main aim is to develop
extensive competence that can be utilised by businesses, industry and the public sector in the region as
well as globally. HAMK’s centres of expertise, developed in cooperation with companies and
municipalities, support our degree programmes as well as research and further education. Our fields of
education are Culture, Natural Resources and the Environment, Natural Sciences, Social Sciences,
Business and Administration, Social Services, Health and Sports, Technology, Communication and
Transport, Tourism, Catering and Domestic Services as well as Vocational Teacher Education. All
degree programmes at HAMK are delivered in Finnish with the exception of the Construction
Engineering programme in Hämeenlinna, the International Business programme in Valkeakoski, and the
Mechanical Engineering and Production Technology programme in Riihimäki, which all are delivered in
English. (HAMK University of Applied Sciences)
HAMK University of Applied Sciences launched pre-incubator activities in seven of its units as from 1
st
January 2004. Pre-incubators a.k.a. start-up incubators are located in the Visamäki unit in Hämeenlinna
and in the Forssa, Lepaa, Mustiala, Riihimäki, Valkeakoski and Evo units.
The objective of pre-incubator activities is to learn about entrepreneurship and to learn by actually being
involved in business. The activities are divided in three stages:
- learning to understand entrepreneurship,
- learning by actually being involved in business,
- learning to do business. (Saurio 2003, 117).
2. Background
2.1. Learning entrepreneurial competences
Before we can describe our incubator model, we should define how we understand some key concepts.
It is very important to understand how we believe the people can learn. The first important concept is
learning. We have to think about entrepreneurship, as well. How do we understand the dimensions of
entrepreneurship? Further, we have to understand the concept of competence.
Thus, there are three basic concepts to define. Before the conclusions we would like to specify how we
understand each of them.
2.2. Learning
Learning not teaching is the basic process in entrepreneurial studies at HAMK University of Applied
Sciences. We apply a constructivist view on learning. The main task of a teacher is to support the
learning of his/her students or other learners. Instead of distributors of information, knowledge or skills,
the teachers are more tutors, mentors or counselors who try to ensure that the students get good and
motivating learning experiences and that they reflect on these in interactions and in collaboration with
their tutors and peers. In vocational and professional learning the learning experiences should be as
authentic as possible. That is why we believe in the constructive ways of learning modelled by for
example in Learning by Doing, Project Learning, Action Learning, Problem-Based Learning,
Entrepreneurial Learning etc. Even if we believe in applying several learning models, in this article we
use action learning as an example.
41
There are not only one or two ways of learning. Every learner is a unique person and he/she learns in a
personal way. And that is why we think that learning and teaching should be as personalized as
possible. The basis of a learning process is the mental constructions of a learner. We try to help and
support our learners to find out the best ways of changing and developing their mental construction to
enable vocational and professional growth.
How to support the learning process? The effective methods of supporting learning should be very
many-sided. That means that we should find out several, not only one didactical and pedagogical way to
support the learning process effectively. There are several ways of learning both formally, informally and
non-formally. Reading, doing, observing, group working etc. are examples how to experience learning.
Also the awareness of the meanings and targets is important. The learners should know why to work
and what to do to reach the set objectives. For example at the end of the studies or after the studies, the
incubation of the ideas is a very efficient learning method However, but before that many other methods
should have been used.
2.3. Entrepreneurship
Entrepreneurship is a wide concept. It means not only entrepreneurship as an entrepreneur. It means
individual entrepreneurship, organizational entrepreneurship and intrapreneurship, as well. Paula Kyrö
and Camille Carrier (2005, 22) define these four issues in the following way:
1. The oldest form of individual, self-oriented entrepreneurship, meaning an individual’s self-
oriented behavior (individual entrepreneurship),
2. The creation, management and ownership of a small enterprise, referring to the individual
entrepreneur and his enterprise (entrepreneurship),
3. Corporate or organizational entrepreneurship referring to an organization’s collective behaviour
(organizational entrepreneurship), and finally
4. Intrapreneurship referring to the interplay between individual and organizational
entrepreneurship.
It means that entrepreneurship appears both in finding out and rolling your own business, working for
another or for example in voluntary hobbies. It can be called entrepreneurial behavior (Gibb 2005, 46-
47). He means by entrepreneurial behaviours:
• opportunity seeking and grasping,
• taking initiatives to make things happen,
• solving problems creatively,
• managing autonomously,
• taking responsibility for, and ownership of, things,
• seeing things through,
• networking effectively to manage interdependence,
• putting things together creatively,
• using judgement to take calculated risks.
In the hard core of entrepreneurship there are many different ways of thinking which vary between the
writers. For example according to Koiranen & Ruohotie (2001, 111) entrepreneurship is a holistic,
responsible and innovative way of thinking, acting and being to the working life. It can be seen as the
affective, conative, and cognitive mental properties. In the cognitive area there are for example skills
and the knowledge. But we can see the values and attitudes in entrepreneurship in the affective area as
well. We can see the motivational things and orientations in the conative area. (Snow, Corno & Jackson,
42
1994, 243-248) All these things determine the entrepreneurship as well and they should also be paid
attention to.
On the other hand entrepreneurship is strongly associated with the abilities to recognize the
opportunities in the environment and to exploit them (Kyrö 2005, 15; Carrier 2005, 1; Gibb 2005, 5).
That means especially the ability to see and sketch different states of affairs in the future. A man should
also believe in his own influence on the things that will happen. In other words we need proactivity.
(Heinonen & Paasio 2005, 22)
The concept of opportunity includes the possibility that things go in a planned way. But it also includes
the threat that the things will not do so in a planned way. It means that the concept of risk also concerns
strongly entrepreneurship. The entrepreneurs should be able to live with the uncertainty. (Kyrö 2006,
100)
As a conclusion from the things mentioned above, we would like to present the definition that describes
our thinking: Entrepreneurship is not only being or becoming an entrepreneur. It is holistic, visionary,
innovative, responsible and proactive action with other people to recognize and exploit opportunities.
And entrepreneurship can be learnt in an entrepreneurial way.
2.4. Competence
Competence means not only knowledge, skills and mental qualities of human being that drives him/her
to work. As Helakorpi (2007) lists, we can give:
• Competence is both individual and social.
• Competence is a result of both formal, informal and non-formal learning
• Competence in not only knowing or skills but it is seen more and more as managing the doing
including especially the social interaction.
• Competence includes flexibility, living with insecurity and willingness to change and to be
changed.
• Competence is continuous assessment and development.
• Competence is linked to the context and the culture.
The objectives of learning should be the competences. We could define them “The student is able to
find out the possibilities in his/her substance” It means for example that during their studies the students
of handicraft learn to find out different possibilities to get employed. They may make real products and
try to sell them to real customers. They are allowed to take managed risks and have some insecurity in
their studies. And so on. A very important point is also that the assessment should be targeted to the set
objectives, the competences.
As already mentioned, a good method or learning environment to learn entrepreneurial competences is
to incubate the ideas of the students in an entrepreneurship incubator. At HAMK University of Applied
Sciences there are several incubators and in the following we will present them as case-based teaching.
Or as we rather say “Case-based learning in entrepreneurship education.”
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3. Description of the application of the model at HAMK University of
Applied Sciences
The objective of pre-incubator activities in seven units of HAMK is to learn about entrepreneurship and
to learn by actually being involved in business. The activities are divided in three stages:
- learning to understand entrepreneurship,
- learning by actually being involved in business,
- learning to do business. (Saurio 2003, 117).
The division clarifies the specification of objectives. This means that actual municipal business
incubators are left with the task of further developing and supporting business start-ups, i.e. learning to
do business after graduation. This is why the primary indicator for pre-incubator activities is not the
number of enterprises created, but the quality of activities and the number of students and studies
completed within a pre-incubator’s learning environment. A pre-incubator is, first and foremost, a
learning environment for studying entrepreneurship and business activities.
The objectives for pre-incubator activities specified in the degree programmes’ performance agreements
for 2005–2007 are listed in the table below. The same table also shows the quantitative student
situation for each unit as at 30
th
April 2007.
TABLE 1. The students in the incubators of HAMK UAS
Unit
Target student
numbers in
the degree
programmes’
performance
agreements
for 2005–2007
Situation
as at
1
st
Nov.
2004
Situation
as at
31
st
Oct.
2005
Situation
as at
30
th
Apr.
2006
Situation
as at
31
th
Oct.
2006
Situation
as at
30
th
Apr.
2007
Credits
At
30
th
Apr.
2007
Visamäki 70 57 55 73 29 28 71
Forssa 6–7 7 18 15 15 57 240
Lepaa 10–12 9 13 18 17 19 196
Mustiala 8–9 4 4 41 62 59 397
Riihimäki 29
Not available
7 11 10 22
Valkeakoski 6 5 7 13 2
Not available
Evo 1–2 3 0 0 20 12
Total 130–143
(~135)
85
(excl.
Riihimäki)
102 171
155
197 904
Pre-incubators have been developed systematically in co-operation between pre-incubator leaders and
degree programme contact people and teachers involved in pre-incubator activities. In addition to
student counselling and guidance, other key aspects of these activities include training for mentors
participating in the activities. Five training events were organised in 2004, dealing with topics such as
the status of the student, the role of the leader, student counselling at the pre-incubator, constructive
assessment and finances. Training events in 2005 focused on entrepreneurship education and
developed a pre-incubator strategy, networking and business co-operation. Each unit organised an
open day to present and market pre-incubator activities to students, teachers, other staff members and
partner enterprises.
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The Action Learning method has formed a key part of pre-incubator pedagogy in HAMK University of
applied sciences. By working in a small multidisciplinary ‘set’ (group), students receive constructive
feedback for their actions, new insights and encouraging support from their peer group. The
multidisciplinary nature of sets has been considered to be useful, because it allows students to receive
feedback both from students specialising in other fields and from those studying the same field. At the
same time, Action Learning set participants’ self-knowledge and perception of other people’s behaviour
increase, while their ability to ask questions, listen and converse improves. Action Learning is about
development of business ideas and of the students themselves. Development is accomplished in a form
applied to each student’s own needs, in a practical manner and by solving real-life problems.
Action Learning has made it possible to achieve successful learning experiences. Action Learning sets
have produced clear and immediate benefits for development of students’ own enterprises or business
plans. Students have learnt to ask questions and listen to other people as well as to provide and receive
constructive feedback. They have time to think and reflect on their own views between set meetings.
Students also learn to network while they are still studying. Many have adopted a new, questioning
approach to their work. In addition, pre-incubator students have also put together personal study plans
to support and develop their own pathways towards entrepreneurship. Studies completed using the
Action Learning method provide an average of 5–15 ECTS credits per year.
Pre-incubators may also perform a Thomas Personal Profile Analysis for students in the final stages
of their studies, which provides them with personal feedback both orally and in writing. The Thomas
analysis aims to give an objective and structured overview of a student’s communication and
behavioural style at work. Feedback allows students to improve their self-knowledge and self-esteem. At
the same time, students have also received constructive feedback about functioning as an
entrepreneur, their communication styles and their supervisory and sales skills. To date, pre-incubators
have already done Thomas analyses for about twenty students.
The HAMK University of Applied Sciences Starttihautomo co-operative was established in the spring
of 2004. The co-operative is a company supporting pre-incubator studies and students’ entrepreneurial
activities, where students can safely practise business operations while studying, without losing their
student status or benefits. The co-operative allows them to combine studies and entrepreneurship in
practical terms during studies. The purpose of the co-operative is to function as a marketing channel for
pre-incubator students’ own business ideas, their own products or the products and services of a
potential business enterprise and as a platform for practical entrepreneurship training. Students have
the opportunity to join the co-operative while they are studying.
The Sense business plan competition aims to kick off new business ideas, teach about business
planning and create new ideas, innovations, human capital and networks and to produce additional
positive energy for work, growth, learning and life in general (www.sense.hamk.fi). The idea behind the
Sense competition is to provide expert lectures at the beginning of the competition followed by a
brainstorming and writing process to support students and finally public presentation of entries. Sense is
an open business plan competition, which has been organised ever since 2001. The first competition
aimed to invent something completely new and to make way for creative thinking. Participation in
various business plan competitions has supported students in their entrepreneurship studies.
Co-operation with other promoters of entrepreneurship is carried out on a daily basis. Training
events have been organised in different locations in co-operation with business incubators maintained
by municipal business development departments, while joint plans have been made to promote
entrepreneurship based on the above-mentioned division of roles. HAMK pre-incubator activities have
developed considerably during the three years of operation. A pre-incubator is a learning environment
providing students with opportunities to complete entrepreneurship studies, projects and work
45
placement and prepare their own Bachelor’s thesis relating to product development, business plans,
marketing or developing their own business operations. Pre-incubators provide learning through
reflection and experience. Learning is problem-based, self-directed, goal-oriented and action-based
learning by doing. Pre-incubator activities aim to increase awareness of entrepreneurship and business
activities. The HAMK pre-incubators and Action Learning as a pedagogical process help students
choose study units aiming at setting up and running a business. Pre-incubator activities support
students’ learning process through counselling, guiding and training them towards the world of
entrepreneurship by interactive and community-based means.
References
Carrier, (2005). Pedagogical challenges in entrepreneurship education. In Kyrö, P. & Carrier, C. (Ed.)
The Dynamics of Learning Entrepreneurship in a Cross-Cultural University Context. Entreprenreurship
Education Series 2/2005. University of Tampere. Faculty of Education. Research Center for Vocational
and Professional Education.
Gibb, A. (2005). The future of entrepreneurship education – Determining the basis for coherent policy
and practice? . In Kyrö, P. & Carrier, C. (Ed.) The Dynamics of Learning Entrepreneurship in a Cross-
Cultural University Context. Entreprenreurship Education Series 2/2005. University of Tampere. Faculty
of Education. Research Center for Vocational and Professional Education.
HAMK University of Applied Sciences. Retrieved May 24, 2007, fromhttp://portal.hamk.fi/portal/page/portal/HAMK/In_English/About_HAMK
Heinonen, J. & Paasio, K. (2005). Sisäinen yrittäjyys kuntatyössä. Kunnallisalan kehittämissäätiön
tutkimusjulkaisut nro 48.
Helakorpi, S. Osaaminen ja sen arviointi. Retrieved May 23, 2007, fromhttp://openetti.aokk.fi/seppoh/osaamismittarit/index.htm
Koiranen, M. & Ruohotie, P. (2001). Yrittäjyyskasvatus: analyyseja, synteesejä
ja sovelluksia. Aikuiskasvatus 2/2001
Kyrö, P. & Carrier, C. (2005). Entrepreneurial Learning in universities: Bridges across borders. In Kyrö,
P. & Carrier, C. (Ed.) The Dynamics of Learning Entrepreneurship in a Cross-Cultural University
Context. Entreprenreurship Education Series 2/2005. University of Tampere. Faculty of Education.
Research Center for Vocational and Professional Education.
Saurio, S. (2003). Yrittäjyyden edistäminen ja yrityshautomotoiminta ammattikorkeakouluympäristössä.
Satakunnan ammattikorkeakoulu, A, tutkimukset 1/ 2003. Pori: Satakunnan ammattikorkeakoulu.
Snow, R.E., Corno, L. & Jackson, D. (1994). Individual Differences in Affective and Conative Functions.
In Berliner, D.C. & Calfee, R.C. (eds), Handbook of Educational Psychology. New York. Simon &
Schuster Macmillan, pp. 243-310
46
Entrepreneurship Promotion Cooperation Model in Kajaani and Kainuu
”Promoting Entrepreneurship in Kainuu”
Entrepreneurship Path Cooperation Model
Päivi Malinen, MSc
Kajaani University of Applied Sciences
[email protected]
+ 358 44 7101 612
Päivi Partanen, MSc
Intotalo, Entrepreneurship Training Centre
[email protected]
+ 358 44 3229 222
Keywords:
cooperation, learning by projects, learning by doing
47
1. Background to the entrepreneurship Path
The development of entrepreneurial attitudes and entrepreneurial skills is high on the list of regional targets. In
the future Kainuu will need more and more entrepreneurial personalities who are creative, independent and
self-confident solution seekers possessing good taste, good social skills and a capacity for independent
thinking. According to research, 49 % of students studying at Kajaani University of Applied Sciences are
interested in entrepreneurial activities. (Eronen Auli, 2005)
The development of entrepreneurship within the local authority of Kajaani is the responsibility of the Kajaani
Technology Centre Oy /Business Development Department. The Business Incubator (Entrepreneurship
Training Centre) Intotalo is responsible for supporting and organising training for recently established and new
businesses. Intotalo has been operating in Kajaani since the beginning of 2003. During the autumn of 2005
Intotalo also started operating in Vuokatti within the vicinity of Snowpolis.
It has been necessary to find new ways of working and to carry out widespread cooperation between different
parties in order to meet the challenges posed by entrepreneurship in the region. The aim of such cooperation
has been to create structures and support networks to make starting up a business easier for new
entrepreneurs. The goal is to enthuse university graduates with the desire to start out in business.
Intotalo started as an ESF funded project and its operations became permanent in 2006. Thus a permanent
and successful cooperation model and structure has been created in Kainuu that involves Intotalo, Kajaani
University of Applied Sciences and other educational institutions and businesses.
Learning Environment-Business Incubator Intotalo
Kajaani University of Applied Sciences entrepreneurship path’s main learning environment is the Intotalo
Business Incubator. Intotalo is a learning environment that advances learning in skills required in project work
and running a business. Learning in the Intotalo is based on constructivism i.e. learning by doing. The learning
process can also be described as a combining of theoretical and practical knowledge and self-knowledge (e.g.
Research Professor Päivi Tynjälä). According to research, project work and learning by doing effectively
promote the development of an individual’s business skills and above all, generate an entrepreneurial attitude.
The most important value of the Intotalo is community. It strives to create an atmosphere and environment
where small businesses can work together instead of alone. Through such a community it is easy for
businesses to network with other companies and active parties in the Kainuu region. Start-up entrepreneurs
and entrepreneurship students have had positive experiences of the Intotalo at the outset of their business
activities. They received valuable help from others in creating their own customerships and other practical
issues related to running their own businesses.
Kajaani University of Applied Sciences and Intotalo work in close collaboration to promote entrepreneurship in
Kainuu. Intotalo is Kajaani UAS’ business incubator. Their common aim is to discover new, start-up
entrepreneurs amongst the UAS students for the incubator and to advance the development of up and running
and developing companies from the outset.
48
2. The aim of Cooperation
The aim is to recognise and find potential entrepreneur personalities from the different fields of Kajaani
University of Applied Sciences and offer them the opportunity to develop their own business idea in practice.
The target is to ensure that cooperation between Kajaani UAS and Intotalo will lead to 5 % of all graduates
from Kajaani UAS establishing their own companies within five years of graduation.
3. The Entrepreneurship path in practice
Every spring Intotalo organises an open business idea competition in which participating Kajaani UAS
students can develop their business ideas with the help of Intotalo’s network of mentors. This support will be
focussed on the best business ideas presented to the selection panel. The main competition entrance
requirement is that the idea can be implemented in Northern Finland.
Students are able to test their own ideas and skills in practice via their studies and the business incubator
organised by Kajaani UAS and Kajaani Intotalo. It is intended that 10 start-up businesses will be found per
year for the business incubator.
Completed actions:
- Planning of entrepreneurship studies in co-operation with Kajaani UAS entrepreneurship liaison
teachers and Intotalo
- Marketing of entrepreneurship courses to Kajaani UAS students and courses delivered at the
Intotalo
- Supports the development of start-up businesses in the different fields of Kajaani UAS and provides
entrepreneur personalities the opportunity to develop their own idea in the incubator.
- The Intotalo Incubator offers students a workstation, a customer and co-operation network and
training in running their business operations and creating their own customer base.
- Graduates of Kajaani UAS
o The aim is to maintain contact with Kajaani UAS graduates and to support the development of
their entrepreneurial skills and knowledge.
o The willingness of Kajaani UAS graduates to go into business will be surveyed.
o The results of the surveys will be used to plan and market incubator-run training courses, a
possible second-cycle UAS degree qualification and specialised studies.
The business incubator entrepreneur courses to be completed during
university of applied sciences studies
Study Modules Contents Description
Innoste-Business
Idea Competition
A regional business idea competition open to all UAS students for the purpose of
seeking business, product and service concepts for further development. The ideas
and concepts under development presented during this competition can also be
entered in the national Venture Cup business concept competition.
49
Entrepreneurship
Course
9 cr
Students will gain a realistic view of their own opportunities and will make contacts with
other businesses in the region through different commissions and jobs. Students will
determine common aims for their own entrepreneurial skill development in teams. This
course is worth 9 credits (3 + 6). It comprises team training sessions, reading and
practical business ventures.
Business Plan
5 cr
Students must compile their own business plan based on their business idea in
collaboration with the Intotalo trainer and UAS instructor/teacher. Each student will
contact a mentor for support and encouragement in the development of their own
businesses. This course is worth 5 credits.
Practical Training in
Entrepreneurship
30 cr
During the practical training period students will develop their own businesses
according to their business plan. They will try out whether they can successfully
operate a profitable business venture. The practical training period consists of practical
customer – commissioned projects, compiling a business foundation plan and
development work in cooperation with the Intotalo trainers and an experienced mentor.
The practical training period is worth 30 cr. Intotalo provides the students with
workstations and supportive encouragement to develop their theses.
Entrepreneurship
Thesis
15 cr
The students must complete a thesis that includes a practical analysis of the business
they have/are to create and their market areas using applied theory. The thesis is
worth 15 credits. Intotalo provides a workstation as well as encouragement and
support.
Postgraduate path
Incubator - training The target group of the business incubator includes graduates planning to go into
business and small businesses that have recently started operating and that have a
“brilliant idea” or wish to make the most of the opportunities that are on offer in the
locality. The training course comprises entrepreneurship training sessions, the practical
realisation of their business ventures and mentoring. The training course lasts 1 – 6
months.
Entrepreneurship
Sparring partners and
Mentors
Intotalo’s trainers spar on those planning their own business ventures to develop their
own knowledge, networks and customer contacts. UAS students can also take
advantage of the Intotalo mentor network. Those who are planning their own
businesses can also try out their first customer contacts through the Intotalo
Cooperative.
Entrepreneur
Community
Intotalo offers new entrepreneurs workstations, office infrastructure to support the
development of their business and communal support. The business trainers provide
support in compiling the business plan and marketing. The managing directors of the
Intotalo companies meet once a month at their own development and strategy evening.
50
4. Results of cooperation 2003 - 2006
As a result of the common entrepreneurship path, 8 new businesses have been established over the last three
years by UAS graduates. The aim is to further develop such operations and discover 5 new budding
businesses each year. These activities, that originally started as part of a project became a permanent fixture
on 1
st
January 2006.
EXAMPLES OF ESTABLISHED BUSINESS VENTURES:
Momentti Oy
The company offers fresh solutions in the form of sales and marketing publications, product representation,
event marketing, import and marketing surveys. www.momentti.fi
Lähellä Sydäntä Ay
The women who established this care service company already had their business plan ready during their
UAS studies. The name of the company (Close to my Heart) tells you all you need to know about the quality of
their services and the company’s values.
Tilipalvelu Elisa Ohtonen
This effective one-woman accountancy firm carries the entrepreneur’s name. Elisa gained practical work
experience during her UAS studies by taking care of the UAS Learning Company’s financial administration.
www.tilipalveluelisa.fi
Signalia Oy
A company that focuses on PR, communication and media contents production.
www.signalia.fi
3D-ilme
3D image manipulation specifically for house construction and interior design.
www.3d-ilme.fi
Reboot
IT support Reboot offers IT support to small companies.
www.reboot.fi
Mille Trade Oy
A company operating within the field of exports to Italy.
www.milletrade.fi
Western Training
A riding coaching company.
www.westerntraining.fi
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Kajaani University of Applied Sciences / Intotalo
ENTREPRENEURIAL SKILLS 60 cr
This module comprises entrepreneurship training, reading and practical customer relationship creation.
Studies will be carried out in teams of approx. 10 persons that will be formed from the course applicants,
according to the Pelp team role test results. The main training location will be the Kajaani Intotalo and students
will also have the opportunity to operate in the Vuokatti Intotalo within Snowpolis.
The student team will be given their own workstation in Intotalo for the duration of the module. They will be
guided and supported by their instructors and the Intotalo trainers and experienced mentors.
Description of the module:
1. Creativity in practice
Credits 3 cr
Aims Students will gain a realistic view of their own opportunities and will make contacts with other
businesses in the region through practical commissions. Students will determine common aims for
their own entrepreneurial skill development in teams.
Contents Creativity and innovation, own creativity profile, customer interface and observation of business
opportunities, features of an entrepreneur and creation of networks.
Required data Application, Pelp’s role test
Assessment requirements Team training sessions (24 H), business commissions, essays based on reading (3 points),
personal learning agreement
Recommended reading Coelho: Alkemisti
Koski & Tuominen: Kuinka ideat syntyvät
Johansson: Medici ilmiö
Nordström&Ridderståle: Karaoke kapitalismi
Peltola: Jokaisella on juttunsa
or three points (3 p) worth of reading from the Entrepreneur’s Best Books Guide/Yrittäjän Parhaat
Kirjat valintaoppaasta.
Instructor/s Päivi Partanen, Olli Leppänen
Evaluation Pass/Fail
Other The student team will be given their own workstation in Intotalo.
2. Practical Business Ventures
Credits 6 cr
Aims Students will create customer contacts and test their own entrepreneurial and project skills in
practice together with their team.
Contents Leading customerships, practical project leadership, time management, team leadership,
marketing and innovation. An entrepreneurial attitude.
Required data A pass in 3 cr of Creativity Studies.
Assessment requirements Team training sessions (48 H), essays based on reading (3 points.), planning and implementing a
customer project in practice.
Recommended reading Sarasvuo & Jarla: Myynnin korkeajännitys
Storbacka: Asiakkaan ehdoilla
Quinn: Asiakas ykköseksi
Tracy: Advanced selling strategies
Roddick: Business as Unusual
Altmann: Myyjästä voittajaksi
Gad: 4D Brändimalli
Pine&Gilmore: Experience Economy
or three points (3 p) worth of reading from the Entrepreneur’s Best Books Guide/Yrittäjän Parhaat
Kirjat valintaoppaasta.
52
Instructor/s Päivi Partanen
Evaluation Pass/Fail
Other The student team will be given their own workstation and equipment supporting their business
operations in Intotalo Kajaani or Vuokatti. The teams will also receive a small amount of start-up
capital to develop their projects.
3. Business Plan
Credits 5 cr
Aims Students will compile their own business plan based on their business idea. They will contact a
mentor who will support them and spar them on to develop their business.
Contents Compilation and development of the business plan, building a safety net or support networks,
evaluation of the business plan
Required data Application and own business idea
Assessment requirements Entrepreneur training sessions (24 H), business plan
Recommended reading Lehtonen P: Strateginen yrittäjyys
Holopainen & Levonen: Yrityksen perustajan opas
Lyytinen & Piha: Yritä edes!
Collins: Hyvästä Paras
Chan&Mauborgee: Sinisen Meren strategia
Norman: Nomannin liiketoimintateesit or reading from the Entrepreneur’s Best Books
Guide/Yrittäjän Parhaat Kirjat valintaoppaasta
Instructor/s UAS entrepreneurship teachers, Päivi Partanen and the Intotalo trainers and business mentors
Evaluation 1-5
Other The student team will be given their own workstation and equipment supporting their business
operations in Intotalo Kajaani or Vuokatti. Some of the entrepreneurship training sessions will be
carried out with other students in the process of developing their own business ideas.
4. Practical Training
Credits 30 op
Aims Students will be able to take advantage of business opportunities that they have noticed by
establishing and organising their business operations according to their business plan. Students
will test their ability to carry out a business venture in a profitable way.
Contents Development of the company in the business incubator, business foundation plan, mentoring and
creating customerships. Practical customer projects.
Required data Approved business plan
Instructor/s Practical training teacher supervisor,
Päivi Partanen and the Intotalo business trainers and mentors.
Evaluation Pass/Fail
Other The student team will be given their own workstation and equipment supporting their business
operations in Intotalo Kajaani or Vuokatti.
5. Thesis Compiled in own Business
Credits 15 cr
Aims Students will be able to analyse their own business operations and markets in a practical way
while at the same time applying acquired theoretical knowledge.
Instructor/s Thesis teacher supervisor,
Päivi Partanen and the Intotalo business trainers and mentors.
Evaluation Fail, 1 - 5
Other The student team will be given their own workstation and equipment supporting their business
operations in Intotalo Kajaani or Vuokatti. The thesis process is done according to the Kajaani
University of Applied Sciences thesis process.
53
Business Planning 3 ECTS (Business Plan)
virtual based web –course
in Kajaani University of Applied Sciences
MA Pekka Tervonen
Lecturer in economics, business operations and entrepreneurship
Kajaani University of Applied Sciences
Keywords:
business plan, mission, vision, business idea, strategy, risk
Executive summary (abstract)
The main objective of this course is to study the planning targets of a company by means of a
business plan. The pedagogical method used in this course is (LBD) – learning by doing. The
course will be implemented through the Moodle and/or the WebCt virtual learning environments
In this course a student will complete a Business Plan of a real or fictitious company on a
formulated sheet as a word document.
The course includes the company’s mission, business idea and its different parts, analysis of
competition, strategy, finance and profitability calculations, vision, SWOT analysis and a brief
risk management plan. The course does not include the company’s marketing plan. Virtual
studies mean that it is possible to accomplish this course in the by distance learning, which is
very important in sparsely populated areas such as Kainuu and Northern Finland.
The pedagogical aim of the course is to promote enterprise using the LBD (learning by doing)
method or authentic learning. Students can access instructions and material via the Internet
links and model business plans. The course instructor will evaluate the business plans returned
by students and provide feedback. The feedback takes place by the communication tools of the
learning environment. The communication between the instructor and students has not been
very lively depending on the nature of the course. In many cases the representatives of the
target company have supervised the students in problems to complete the business plan
(authentic learning). This course is offered as a free-choice course in all fields at Kajaani
University of Applied Sciences. There is no amount limit for students to access the course. The
instructor resource needed is 4 hours per student.
54
1. Background
One of the main issues that the strategy of the Kainuu region and Kajaani UAS focuses upon is
the promotion of business entrepreneurship in the region. In order to implement this strategy an
entrepreneurship path (described elsewhere in the Bepart project) that includes the creation of
a business plan for a company in the making, was compiled at Kajaani UAS. Not all students
wish to establish a company so it was decided that a compulsory short business plan would be
included in entrepreneurship studies in order to ensure that all Business and Administration
students would learn the different focuses of a business plan, the mission, business idea,
strategies, analysis of competitors, basic calculations, values, vision and risk assessment. The
business plan has achieved this objective well. Kajaani UAS also offers a degree programme
delivered in English, the Degree Programme in International Business leading to a Bachelor of
Business Administration degree qualification. Within the framework provided by the Bepart
project it was decided to compile a Business Planning 3 ECTS course for this degree
programme. The aim of this course is to advance business studies amongst international
students and for it to act as a systematic basis for the business plan that must be compiled
when actually establishing a company.
2. Case description
The aim of the Business Planning course, worth 3 credits, is to promote entrepreneurship
amongst the students with the aid of a business plan. The method used is (LBD) – learning by
doing. The course will be implemented through the Moodle and/or the WebCt virtual studies
environments. Students will save an empty Word.doc business plan in their directories and fill
in the different parts of the business plan using the Web-based business plan. The business
plan can be compiled for a real or fictitious company. The support business plan contains
instructions and links to the entrepreneurship pages of different organisations where students
will find advice and tips on how to complete their own plan. Students can also email fellow
students and the course instructor to ask for advice concerning their own business plan. The
completed business plan must be returned to the study environment where the instructor will
read, evaluate and comment on it. During evaluation the instructor will be focusing on whether
the plan is logical or not, the compatibility and cohesiveness of the different parts of the plan
and how much the student has learnt about entrepreneurship. Less attention will be paid to
finance and profitability calculations during evaluation. If students really intend to establish a
company they are advised to compile the necessary calculations with the aid of Finnvera or the
Employment and Economic Development Centre in case they require loans or business
support services and financing. Students are also able to accomplish a so-called long business
plan within the context of the Kajaani University of Applied Sciences entrepreneurship path. In
this case it is also necessary to compile a marketing plan for the company.
This course is open to all students in all schools at Kajaani University of Applied Sciences and
it can be included in their free-choice studies. It is also part of the course selection offered by
the Finnish Virtual University of Applied Sciences (www.amk.fi) and where several students
have already completed it. The completed business plans have been good on average and the
promotion of entrepreneurship has progressed according to the goals set. There have been
some problems with the required calculations, though they were not the most important issue in
the course objectives.
55
3. Current challenges/problems facing the organization / project
experience or educational effort
The challenge of the course and its learning provision concerns evaluation and feedback. How
and in what way should feedback be provided? Using the Moodle and/or WebCt virtual study
environments, feedback is provided in an evaluation field located underneath the student’s
personal user ID and password, that the student can access whenever he or she wishes to do
so. At the same time they can also see their grade. Feedback should be critical yet it should
encourage students to become entrepreneurs. Please see the examples of feedback provided,
below:
The mission, vision and values are well defined. The parts of business idea are linked with each other. Also
the competitor analysis is well done. The calculations are not exactly according to the instructions. You
know the value amounts better than I, but usually the total amount of capital need is equal to the financing
total. In the profit statement you estimated no net profit for the first year. This is how it is done for the first
year. If you were a sole trader, your salary would be the estimated net profit. Usually you do not pay YEL
(self-employed person’s pension) if you pay yourself a salary in your company. Your pension fee is
organized through the TEL (employed person’s pension) pension system. As far as I understand, your
business is as a sole trader (private entrepreneurship).
The strategy of the company is well done, too. The customer needs table is good. The conclusion of the
Strategy table has been carried out according to the SWOT –analysis. The risk management table is very
good.
The business plan meets the requirements of this assignment well. Grade 5
The mission, vision and values are well defined. The parts of business idea are linked with each other, but it
is hard to find how your business idea differs from that of the competitors. What is the core know how of
your company? (mystery shopping?) Also the competitor analysis is well done. The calculations are not
exactly according to the instructions. I do not pay much attention to the figures, because this is an exercise.
You know the value amounts better than I, but usually the total amount of capital need is equal to the
financing total. Usually you do not pay YEL (self employed person’s pension) if you pay yourself a salary in
your company. Your pension fee is organized through the TEL (employed person’s pension) pension
system. Here, you should pay the YEL -pension fee, because you do not pay wages to yourself and your
partner.
The strategy of the company is well done, too. The customer needs table is good enough. The conclusion of
the Strategy table has been carried out according to the SWOT –analysis. The risk management table is
satisfactory.
The business plan meets the requirements of this assignment. Grade 3
If there is a lot of information missing or a lot of corrections, students must correct and
complete their business plans and then resubmit them for evaluation.
4. Further reading and list of additional sources
Suitable reading for this course includes any kind of handbook or study book covering
entrepreneurship, business economics, marketing, accounting and law studies. The
Internet also contains huge amounts of information. Below you will find a few links:
Click here for different websites to study the planning targets of entrepreneurship and the
business plan and to learn how to do business in general:
• OCRI (Canadian Entrepreneurship Centre)
• SBA (United States Small Business Administration)
• How to write a business plans (includes sample business plans)
56
• Enterprise Finland (website to start business in Finland)
• Business plan calculators
• Startup Nation (10 steps to start your business)
• Tutor2 (mission, vision, SWOT, values, strategies)
• QuickMBA (mission, vision, SWOT, values, strategies)
• Risk Management
• How to write a marketing plan?
• Sample marketing plans
5. Appendix
Below instructions on how to log into the Business Planning 3 ECTS course.
BBA Website
The BBA courses in Kajaani University of Applied Sciences over the Internet will be offered in
Moodle. You can found our e-learning environment from:http://montana.kajak.fi/moodlebba/
Moodle is a web-based Virtual Learning environment program that allows the classroom to
extend onto the web.
You must create your own username and password to access the environment:
click LOGIN in the top right hand corner,
You'll need to take a minute to create a new account for yourself on the web site. Each of the
individual courses may also have a one-time "enrolment key", which you won't need until later.
Here are the steps:
1. Fill out the NEW ACCOUNT form with your details.
2. An email will be immediately sent to your email address.
3. Read your email, and click on the web link it contains.
4. Your account will be confirmed and you will be logged in.
5. Select the course you want to participate in.
6. If you are prompted for an "enrolment key" - use the one that your teacher has given
you. This will "enrol" you on the course. The enrolment key is "pisnes".
7. You can now access the full course. From now on you will only need to enter your
personal username and password (in the form on this page) to log in and access any
course you have enrolled on.
8. On the homepage click Free choice studies, then click Business Plan 3 ECTS. and
start writing your business plan according to the instructions, tips and links.
You can always RELOGIN- from same place ( left side).
After registering check your PROFILE in the top right hand corner ("Your Name"). To edit your
personal information, click on "Edit Profile".
If you have questions about your course, please contact your teacher.
If you have problems with the Environment (username or password are missing), please
contact the administrator: [email protected]
57
Business Plan in Word –format
P.O. Box 52
87101 KAJAANI
FINLAND
Tel. +358 8 618 991
Fax +358 8 6189 9424
Business Planning
Business Plan 3 ECTS
BUSINESS PLAN
Date of the plan:
Author/s:
Name of the Company
and contact information:
58
1. Basic Information of the Company
Name of the Company and type of Company
Mission:
Owners:
Managing Director:
Regional marketing area and inhabitants:
Typical features for the branch:
59
1.1. Information of the Entrepreneur(s)
Name
Education
Work experience
Entrepreneurial experience
Hobbies and other activities
supporting entrepreneurship
Motives for entrepreneurship?
Why do I want to become an
entrepreneur? Comment on
your entrepreneurship test.
Name
Education
Work experience
Entrepreneurial experience
Hobbies and other activities
supporting entrepreneurship
Motives for entrepreneurship?
Why do I want to become an
entrepreneur? Comment on
your entrepreneurship test.
60
2. Environment of the Company
2.1. Competitors
Our core competitors are:
Name of the competitor (Reasons why?)
Our marginal competitors are:
Name of the competitor (Reasons why?)
Our potential competitors are:
Name of the competitor (Reasons why?)
What is the competitive situation? How do the companies in your branch compete? What is the vision of the market?
61
2.2. The Projected Situation of the Company
2.2.1 Business Idea
business idea
Customer´s needs
Image
Customers/target groups
Product/Services
Operational mode that the Company employs (How does the Company work?)
Resources
Physical Economic Human
62
2.2.2 Operational Mode (How to do Business?)
How do you get customers? Marketing communication tools?
Product development. Product range
Pricing
The sales operations
63
Organising the purchases. Chain or wild? Storage?
Transportation, delivery of the goods and services to the customers?
Services and administration (offers, orders, book keeping, wages and agreements)
64
2.2.3 Financial Analysis of the Company
2.2.4. Capital need
1. Investment schelude - .
Target cost
Machinery
Equipment
Buildings
Other long term investments
Total
2. Short term working capital
Inventories
Cash needed at the beginning before cash flow
Total
CAPITAL TOTAL (investments + working capital, transfer to total financing next
page)
65
2.2.5 Financial Plan
+ equity capital
cash
other property
oparating income (net cash inflow)
+ borrowed capital
banks
Finnvera
other
+ subsidies
TE-centre
other
= FINANCING TOTAL
Securities:
66
2.2.6 Projected Profit and Loss Statement
1.1.1 net profit
+ loan repayments
+ interests
= need for net profit
+ operating fixed expenses:
gross wages
social security expenses
rent
electricity and water
travel expenses
repairs and maintenance
marketing and PR
purchase of services (fixed)
entrepreneur´s pension (YEL)
entrepreneur´s unemployment insurance
insurance
other
= need for gross profit
material purchases
= turnover
+ value added tax (VAT) 22 %
= Total sales
67
2.2.8 SWOT –analysis of the Company
SWOT-analysis
Company´s internal
Strengths
Weaknesses
in environment and in the future (external)
Opportunities
Threats
68
3. Strategic Planning
3.1 Choice of the Generic Strategy
Alternatives are:
Low cost leadership Differentiation
Focus (low cost) Focus (Differentiation)
Generic strategy of the Company is
because
3.2 Customers:
Customers
/target groups
Customer´s special needs for products and services
69
3.3 Product Portfolio Strategy
Classify Company´s products
Star products : Question mark products:
Cash Cow products: Dog products:
70
3.4 Conclusion of the Strategy (Actions to make the Strategy concrete, what do you do?)
Company´s internal
in environment and in the future
(external)
Strengths
Weaknesses
Opportunities
Utilize (succes strategy)
Develop (development strategy)
Threaths
Get prepaired for (substitute strategy)
Avoid (existencestrategy)
71
4. Vision
4.1. Company´s values and vision
Company´s values are:
Company´s vision is: (up to 5 years)
72
5. Risk Management
Company´s external risks are:
Company´s internal risks are:
How does the Company manage risks? (remove, decrease, transfer risks)
73
ROXI Entrepreneurship Training Programme
ROXI – Case Study of Rostock University
Doreen Holtsch & Melanie Hoppe
Rostock University
Chair of Economic and Business Education
1. Learning Goals
content-related: promoting personal entrepreneurial competencies
implementing a competence-analysis
using creativity methods (e.g. Brainstorming)
implementing a SWOT-analysis on business ideas
soft skills: promoting empathy
developing skills to reduce complexity
2. Executive Summary
This case demonstrates a situation from ROXI entrepreneurship courses held at the University in Rostock
(Germany).
The case focuses on the content of the first week of a full time course with a full duration of three weeks. The aim
of this particular week is to define a clear business idea which corresponds to the potential entrepreneur. The
trainer is challenged with a diversity of participant’s qualifications and needs. Main tasks of the trainer are
• to get familiar with the entrepreneur and their business ideas;
• to instruct the participants to critically evaluate their ideas;
• to use a broad mix of different instruments, e.g. creativity methods, Johari-Window or SWOT-analysis;
• to create an atmosphere in which not just knowledge is being delivered, but the participants’ action and
personal development is in the focus.
74
3. Background
3.1. Institutional background of the programme “roxi”
The Rostock entrepreneurship initiative roxi (ROstocker-eXistenzgründer-Initiative) was founded in 1997/1998 by
the Institute for Human Resource Development, the forerunner of today’s Hanseatic Institute for Entrepreneurship
and Regional Development – HIE-RO
1
.
Before 1997, no specific entrepreneurship education was offered at the University of Rostock. The programme
roxi (ROstocker-eXistenzgründer-Initiative) aimed to close this gap with its training courses.
Background of the idea to start roxi was amongst others the high regional unemployment and low economic
growth rate in the region Mecklenburg-Western Pomerania.
2
The innovation of an entrepreneurship training
programme was thought as a long-term-approach to contribute to regional growth and at the same time to offer a
new and so far missing stepping stone for potential entrepreneurial talents with university background in the
region of Rostock. The initiative for the Rostock entrepreneurship initiative roxi took off at the Chair for Economics
and Business Education. Two members of the Chair and other supporters first took initiative to establish a new
institute at the University of Rostock. The foundation of the Institute for Human Resource Development in the
year 1997 created (as a first step) the needed new platform for the later entrepreneurship training as a
supplement to the regular University courses.
Since the year 1997, the financing for roxi is provided by the European Social Fund together with funding by the
Ministry of Labour and Economy of the German State of Mecklenburg-Western Pomerania. This funding
background is one of the reasons why the number of created start-ups and new jobs are some dominant success
indicators which roxi has to deal with.
While in the year 1997 roxi was a new programme, an empirical survey in 2005 among students at the University
of Rostock emphasised its popularity - 87 percent of the students are aware of the courses offered by roxi and the
project itself
3
.
Since the beginning, roxi aims to inspire entrepreneurial spirit and to support people (especially students,
graduates and scientific staff) in setting up business. In doing so, the initiative’s philosophy is: not everybody is
born as an entrepreneur but can learn to act as one. The aim is to stimulate sustainable entrepreneurial
businesses and to support the process of founding a business through effective training, coaching and consulting.
roxi seeks to promote entrepreneurial thinking at the University and to smoothen the way into professional
independence by setting up a personal business.
The target group are students, graduates, researchers and study drop-outs from different faculties. The roxi -
trainers are teaching along the “learning-by-doing” approach by mainly using the action learning method.
However, this method facilitates real entrepreneurial competencies through providing a mix of knowledge,
attitude, skills and customs combined with economic and business know-how.
Twice a year a full time roxi-course is offered during summer and spring break with a duration of three weeks or
120 training hours. During the semester on Friday evenings and on Saturdays a part-time course is offered over a
period of ten weeks.
While regular university courses are so far free of charge in Germany, roxi asks for small participant fees.
Participation costs roughly 100 EUR for a three week course. The idea behind the fee is twofold: (1) to keep free-
riders out of the course and to support commitment by setting up a small barrier, and (2) to cover cost (e.g. for
catering/ drinks/ fruits) which otherwise could not be paid out of the given programme funding.
1
Further information are available on: www.hie-ro.de
2
Braun, G.; Diensberg, C.; Mechthold-Jin, M.: Mut zur Selbständigkeit, Gründungstraining und Gründungsforschung am
Institut für Human Resource Development, in: Traditio et Innovatio, Forschungsmagazin der Universität Rostock, 3 (1998), 1,
S. 13-16.
3
Wilde, Kerstin (2005). Entrepreneurship Education – konzeptionelle und didaktische Herausforderungen. Kompetenz für
Komplexität? – Ergebnisse der Studentenbefragung in Rostock 2003. Eine Studie von ROXI, Rostocker Existenzgründer
Initiative in Zusammenarbeit mit GründerFlair, Netzwerk für Existenzgründungen aus Hochschulen in Mecklenburg-
Vorpommern. Rostocker Arbeitspapiere Nr. 24. Rostock.
75
3.2. The Action Learning Method
Reg Revans is one originator of the action learning method. He itself describes it as “freedom from teachers, from
any kind of printed syllabus or regulations, from any fixed institution, or even from any literature”.
Revans describes his approach in a formula
4
: L = P + Q where the variables L, P and Q are learning,
programmed knowledge and questioning. The questioning part is regarded as central in which the nature of the
problem is being clarified and possible solutions are identified. This group process generates a dialog through
which innovative thinking is generated.
Generally speaking action learning is another form of the Problem-Based-Learning approach. Main distinction is
the fact that the “problem” needs to be real. The groups consist of 4 – 6 members, at the end an action plan has
to be elaborated by the group and real actions have to be undertaken.
The coach or teacher takes the role of a moderator or rather advisor. He has the task to facilitate the process of
the single members, to reflect the periods of learning and problem solving. In doing so he has to support the
dynamic in the group by reflecting the feedback given among the group members and to assure that the
established procedural rules are obeyed. In a next step, together with the participants, he reflects the elaborated
solution. Therefore it is important to document every step. Trough questions the trainer requests the participants
to give objective reasons and to judge the solution.
All together the focus of the seminar is on the participants and the trainer has to be in control of several tasks,
e.g.:
• analysing the target group;
• analysing the training demand;
• planning the team work, team and problem solving;
• developing a training plan;
• proper use of teaching and learning material;
• “Icebreaker” and “Energiser”;
• moderating the group reflection;
• evaluating the target.
3.3. Setting the scene
It is February 2005 and last week the spring break started. Six people signed in for the roxi course. The different
topics and exercises require a lot of different locations. Due to this the roxi employees organize different facilities
at the University. All rooms are equipped with video-projector and moderation equipment.
The different topics and exercises require experts with different competencies. Due to this in each course
approximately 13 trainers are involved; e.g. while one trainer is responsible to raise the participant’s awareness
and to develop their entrepreneurial competencies; another trainer is responsible to develop, select and screen
the participant’s ideas. The twelve roxi course modules are organised along the four CEFE
5
- stages:
4
IFAL – International Foundation for Action Learninghttp://www.ifal.org.uk/brief.html (am 24. November 2007)
5
The Competency based Economies Formation of Enterprise is a set of training methods using an action-oriented approach.
“CEFE’s main objective is to improve the entrepreneurial performance of economic actors through guided self-analysis,
simulating enterprising behaviour, and the build up of business competencies” (www.cefe.net/forum/CEFEshort.pdf). More
information are available on www.cefe.net
76
Figure 1: CEFE-stages (CEFE – Manual for Trainers (1998). CEFE – International)
Since 2002 Mrs. Meier is the project leader of roxi. Working as a consultant in the business and development aid
sector she gathered comprehensive knowledge and experiences in educating entrepreneurs. Within the roxi
training she is doing the course introduction in which the focus is to analyse the participant’s competencies.
Furthermore, she is the participant’s contact person regarding all matters during the whole course.
Another trainer from the trainer pool is Mr. Bunge. He is working as a freelancer for roxi. Next to this he is
involved in the physiotherapy practice of his wife where he is responsible for all managerial and administrative
matters. This is now his third time working for roxi. His specialisation is to coach the potential entrepreneurs to
generate and to set up a business idea.
4. Case Description
To assign for the roxi training the participants fill out a standard form to provide the necessary contact details. But
of course this form doesn’t provide the trainer with further information concerning the business idea, the course
motivation, etc. Due to this, for every course Mrs. Meier invites the “would-be entrepreneurs” to an individual
meeting. During this meeting she receives a rough impression of the person and the motivation.
This year the situation is as follows: Mrs. Meier meets Anke and Christian before the roxi course; Mario, Marie
and Konrad can’t come to a meeting with Mrs. Meier in advance and Anna is already known out of the working
context
About working with Anna she knows the following: Anna is 28 years old and is working as a research assistant at
the University at the Chair of Economic and Business Education since 1,5 years. She is writing her PhD in the
field of entrepreneurial intentions of students in vocational education. After finishing high school Anna worked as
a social insurance clerk. Although Anna is working in Rostock she is living in Berlin in a common law marriage. In
her spare time she is a frequent runner. Her business idea is a floating shower in Berlin’s parks for runners.
Anke is 24 years old and just finished her studies in social pedagogic in Cologne. Currently she is jobless and
living at her parents’ place nearby Rostock. In her spare time Anke is acting on an “open-stage” for amateurs.
Due to her professional situation her father is pushing her to do something. He is a friend of Mr. Bunge, who
recommended the roxi course to Anke. After contacting the roxi office she met Mrs. Meier. During the interview
Mrs. Meier had the impression that Anke is a creative person with a lot of curious ideas, e.g. holding humorous
funeral eulogies or laughing therapy.
Christian was sent by the labour office to the roxi course. He is 35 years old, living in a common law marriage
with one child in the city of Demmin (approx. 70 km distance from Rostock) and is currently unemployed. The
labour office provided him with a vocational retraining as a system administrator. Furthermore, it will provide
financial support for his start-up after finishing this entrepreneurship-course and having worked out a business
plan. His idea is to start up a business as a mobile system administrator, serving the customer on the spot.
Development of
Entrepreneurial
Competencies
Matching the
would-be
entrepreneur
and the
business project
Formulation of
the Business
plan
Presentation of
the Business
plan
77
1
st
day – Introducing each other
In each roxi-course Mrs. Meier is using the first day to gather more information about the participants and to
introduce them to each other. Their task is to create a collage made out of old newspapers and magazines
through which the participants have to explain their private and professional background, their current situation
and their life-visions.
Finishing the collages Marie is the first who wants to present her results. Marie is 25 years old and still studying to
become a teacher for English and German language. While studying she is working as a bar tender at a club in
Rostock in the evenings. During the days she is exercising a lot in the sport studio. Her project idea is to provide
small and medium sized companies with English courses on the spot. It appears that Marie has strong
communication skills.
Based on the collages Mrs. Meier receives the following information about Konrad: He is 27 years old and
finished studying Informatics and Digital Media at the University for Applied Science in Brandenburg two years
ago. During his studies he worked for example for the company Tele-Factory in Potsdam-Babelsberg (located
close to the city of Berlin, approx. 250 km distance from Rostock) where he was responsible for setting up a DVD
department. Furthermore, Konrad and his business partner convinced the board of the Bechstein Company
(piano-maker) to produce an advertisement DVD. This special project, with a duration of more then one year, was
very successful and Konrad and his colleague Stephan started an own company “muxlab”. Together with Mario
he wants to start a business in the field of IT-training.
Konrad and Mario are good friends who grew up together in Havelberg a small city close to Berlin. Mario had to
leave University recently as he didn’t pass an examination. In the presentation he mainly leaves the impression
that he is kind of disoriented and lacking a clear vision for the start-up company, while Konrad explicitly
expressed his visions and ideas. Most of Konrad’s ideas have already been implemented although they are still in
their starting phases. So in general it has to be mentioned that Konrad is involved in several other projects during
the whole training. Furthermore, it appeared that Mario possesses the licence to work as a trainer for autogenic
training, without actively practicing it.
The collages of the other participants reflect and support Mrs. Meier’s impression about the respective person.
As usual Mrs. Meier is finishing the day with an introduction into “How to write a business plan”. She is providing
the participants with a fact sheet which contains the main structure for writing a business plan and is explaining
the single steps: business idea, marketing, production, organisation and management, financing. During the
whole course the business plan accompanies the participants. Following the single tasks and sessions each day,
time is given to them to work out their business plan.
2
nd
day – Getting to know about general entrepreneurial competencies
Regarding Mrs. Meier’s experience some of the participants usually lack knowledge about the tasks, challenges
and even risks of entrepreneurs due to missing contacts with people who have already started a business. To
provide the participants with an idea about this “mysterious” group of people entrepreneurs, she shows a short-
movie about entrepreneurial competencies and success cases. Within the movie the participants learn, how
experienced entrepreneurs handle challenges and accept defeats. Other points stressed are the combination of
private and professional life, dealing with doubts as well as with the constant search for new ideas. Following this,
their task is to select the entrepreneurial competencies from the people they “meet” in the movie – generalise
entrepreneurial behaviour and special characteristics of entrepreneurs.
Finishing the movie session Mrs. Meier is introducing the Johari Window method (see “Supporting Material II”) to
the participants. They are asked to evaluate their own individual behaviour with this method. The method’s aims
are twofold. On the one hand it can support the interpersonal relationship between the group members through
introducing feed-back rules etc. On the other hand it provides self-disclosure for the single person. Group
members can react very different on this method; while some are reticent others are open and curious. Anna and
Marie asked very inquisitively how the method is working and what the expected results are. The male
participants seem to be less interested and offended by it.
78
Part of the task is a reflection of the self-evaluation by the group including an external evaluation through its
members. Mrs. Meier is providing all participants with a working paper that shows the figure of the Johari Window
but not as usual with the original 55 adjectives. To ease the task, own adjectives could be used by the
participants instead of using the standard words. For some of the participants the gap between self and external
evaluation is very surprising and in some cases even hard to accept.
The roxi-participants usually spent their lunch breaks together in the nearby student cafeteria – sometimes with
the trainers, sometimes without. Their talks during the breaks are mainly dominated by discussions about their
business ideas and possible problems they might face. During these breaks a grouping becomes visible. While
Konrad and Mario are pretty often together; Christian is more reserved. Anna and Anke giggle a lot. Very seldom
Marie is joining the group because she is using the breaks to organise other things.
After the lunch break Mrs. Meier is introducing the action learning game “Ball fabric”
6
(see Appendix 1) to
stimulate the personal creativity and innovation competencies. The “Ball fabric” is one method from the action
learning approach. Therefore she is asking the participants to form a circle. In doing so the participants simulate a
production chain in which everybody is providing service to produce “something”. The product is represented by
the ball. The game starts with one ball. The participation of everybody is necessary for the “production process”
which is represented by handing over the ball to the other group members. The “production process” is completed
when the ball is back to the beginning of the chain. While doing so Mrs. Meier is taking the time and counting the
mistakes (dropping the ball). The results are visualised on a flip chart. In the next stage two more balls are used
and the task is to do the same process in a more efficient time frame and to minimize the failure rate to zero.
The trainer is pushing the group more and more to stimulate innovations and support creative thinking. So in
general the trainer (Mrs. Meier) is taking the role of a “competitor”, through putting pressure on the entrepreneurs.
This pressure leads to a situation which forces the young entrepreneurs to think innovatively and figure out new
ideas. The game’s main issue is to show the participants how to handle a situation where pressure is put on them
from outside and still being open for innovations.
The most innovative idea for transporting the ball and reducing the failure rate gave Konrad. He suggested that all
participants form a very close circle so that just one person is holding the ball in the middle of the circle and
everybody is touching it. However, due to this the failure rate can be reduced to zero and the least time is
needed.
Finishing the game Mrs. Meier is discussing the question: What has to be done by an entrepreneur to assure and
promote improvement and progress? Putting the focus on the games evaluation the appraisal of this game
usually takes twice as long as the game itself. It stresses the importance of innovation and external impulses to
stay competitive.
3
rd
day – Evaluation of one’s own entrepreneurial competencies
On the next day Mrs. Meier is providing the participants with the Personal Entrepreneurial Competencies –
Questionnaire (see “Supporting Material III”). The questionnaire contains 55 items which have to be ranked on a
scale from 1 (never) to 5 (always). Summarizing these items to 10 competency categories the participants finally
receive an overview about their entrepreneurial competencies which they already posses at the beginning of the
training.
Finishing this questionnaire the participants spent the afternoon with information seeking via internet or personal
and telephone interviews.
6
The game „Ball fabric“ is one example for the action-learning approach. Instead of listening, the participants are actively
involved.
79
4
th
day – Business idea generation and evaluation
Mr. Bunge has been invited by Mrs. Meier for another session regarding the topic - idea generation and
evaluation. This topic includes the following: overview of creativity techniques, e.g. brainstorming, idea screening
and SWOT-analysis.
To warm up the participants, Mr. Bunge as usual starts with a SWOT-analysis of each business idea. Therefore
the participants are asked to use the SWOT-table and to evaluate their own ideas regarding its strengths;
weaknesses; opportunities and threats (see “Supporting Material IV”).
Following Mr. Bunge is introducing different methods to generate new ideas. For some of the participants it
seems to be very difficult to make use of these methods and to get acquainted with new ideas; e.g. Christian. He
is very focused on his idea and doesn’t want to “waste” his time with finding new ones. Anna is very innovative
and immediately creates 20 new ideas. Meanwhile it became visible that Konrad and Mario are not convinced
anymore about starting a business together. But instead of being even more creative and looking for new ideas
for themselves, Konrad stays with his idea and doesn’t want to change it and Mario is absolutely discouraged.
Their task is to find 50 new ideas in the first step, which is impossible for all of them immediately. Due to this Mr.
Bunge is always asking the group to generate new ideas for each member. This process is supporting the group
dynamics and opens the participants’ mind for new ideas. Usually roxi participants really enjoy this task because
funny and absurd ideas are generated which would have never been contemplated by the single person (see
“Supporting Material V”).
In a second step the ideas have to be evaluated by the participants regarding their feasibility. A selection out of
the 50 ideas has to be undertaken and evaluated regarding the questionnaires. The questionnaires are designed
in such a way that they are connecting the new idea with the persons’ strengths and weaknesses and the market
potential (see “Supporting Material III”).
The results show that Anna’s idea doesn’t fit to her competencies but some new generated ideas are much more
suitable for her. Marie’s idea seems to fit to her but she recognizes that too many competitors are on the market
that could hamper the market entry. Due to her “strange” ideas it is almost impossible for Anke to evaluate the
market potential of her ideas, e.g. the demand and existing networks.
In the evening Mr. Bunge is meeting Mrs. Meier to give her the results of the day. She is very amazed about
them, especially regarding the results for Anna. On the next day she is talking with each participant about it. In
Anna’s case she agrees to the fact that Anna is lacking the necessary competencies to realise her idea but
because Anna is brimming over for enthusiasm for it, Mrs. Meier is encouraging Anna in her idea.
5. Further Reading
Action Learning Method
• Marquardt, M.J. (1999). Action learning in action. Palo Alto, CA: Davies-Black.
• Pedler, M. (1991). Action learning in action. Palo Alto, CA: Davies-Black.
• Raelin, J.A. (2000). Work-based learning. The new frontier of management development. Reading, MA:
Addison-Wesley.
• Reichert, A. (2006). The trainer in Entrepreneurship Education. In: Braun, G. / Diensberg, Ch. / Kadler, S. /
Reichert, A. / Wilde, K. Entrepreneurship Education – Challenge for Universities in the 21
st
century. Rostock
Working Papers on Economic and Human Resource Development. No. 25. Rostock. p 97 – 140.
• Revans, R. (1980). Action Learning: New techniques for management. Blond & Briggs, Ltd., London.
• Wilde, K. (2006). Constructivist Curriculum for Would-Be-Entrepreneurs’ Training. In: Braun, G. / Diensberg,
Ch. / Kadler, S. / Reichert, A. / Wilde, K. Entrepreneurship Education – Challenge for Universities in the 21
st
80
century. Rostock Working Papers on Economic and Human Resource Development. No. 25. Rostock. p 63-
96.
Task 2
• Brandstätter, H. (1997). Becoming an entrepreneur – a question of personality structure? In: Journal of
Economic Psychology. p. 172.
• Brockhaus, R.H. / Horwitz, Pamela (1987). Psychology of Entrepreneur. In : Sexton, D.L. / Smilar, R. (eds).
The Art and Science of Entrepreneurship. Cambridge, Ballinger, Mass. Publishing Company. p 25-48.
• Commission of the European Communities (2003). Green Paper: Entrepreneurship in Europe.http://ec.europa.eu/enterprise/entrepreneurship/green_paper/green_paper_final_en.pdf
Task 3
• Beck, Charles E. (1994). Perspectives on the Self in Communication: The Cognition Continuum and the
Johari Window (Theory and the Profession). In: Technical Communication: Journal of the Society for
Technical Communication. November 1994. p 753-56.
• Perreault, Gerri (2002). Self-Knowledge and Leadership: The Johari Window. In: Campus Activities
Programming. October 2002. p 64-66.
• Shirland, Larry / Polczynski, James J. (1984). Dynamic management communication exchange: A
mathematical model of information flow through the Johari Window. In: Journal of management studies. p 21-
27.
Task 4
• Levy, M. / Delahoussaye, M. (2000). Reg Revans: A Man of Action. Training Journal.
• Revans, R. W. (1979). Action Learning. Blond and Briggs. London.
• Revans, R. (1998). ABC of action learning: Empowering managers to act und to learn from action. London:
Lemos & Crane.
Task 5
• CEFE – International (1998). CEFE-Manual for Trainers. Part IV – Exercises 3.2.2.
• www.cefe.net
Task 6
• Dimo Dimov (2007). Idea generation from a creativity perspective. In: Entrepreneurship; Vol. 2: Process -
Westport, Conn. [u.a.] : Praeger, . - 2007, p 19-41.
Task 7
• CEFE – International (1998). CEFE-Manual for Trainers. Part IV – Exercises 4.2.3.
• www.cefe.net
81
6. References
• Sexton, Donald L. / Landström, H. (ed.) (2000). The Blackwell handbook of entrepreneurship. In conjunction
with the School of Business and Entrepreneurship at Nova Southeastern University. Malden, MA. Blackwell
Business [u.a.].
• Blenker, P., Dreisler, P. & Kjeldsen, J: Entrepreneurship Education –the new Challenge Facing the Universities,
Aarhus Business School, Working Paper 2006-02, March 2006
• Edelson, P. J.: Enhancing creativity in adult and continuing education: innovative approaches, methods, and
ideas, San Francisco : Jossey-Bass, 1999
• Gibb, Allan: Towards the Entrepreneurial University, ncge policy paper 003, May 2005, to be downloaded via:http://ww.ncge.org.uk/downloads/policy/Towards_the_Entrepreneurial_University.pdf
• Kirby, David A.: Entrepreneurship, McGraw-Hill Education, 2003
• Kolb, D.A.: Experimental Learning, San Francisco, 1984
• Reichert, A. (2006). The trainer in Entrepreneurship Education. In: Braun, G. / Diensberg, Ch. / Kadler, S. /
Reichert, A. / Wilde, K. Entrepreneurship Education – Challenge for Universities in the 21
st
century. Rostock
Working Papers on Economic and Human Resource Development. No. 25. Rostock. p 97 – 140.
• Shirland, Larry / Polczynski, James J. (1984). Dynamic management communication exchange: A
mathematical model of information flow through the Johari Window. In: Journal of management studies. p. 21-
27
• Sonnentag, S., Niessen, C. & Ohly, S.: Learning at Work: Training and Development, in: L. Cooper & I.T.
Robertson (Eds.): International Review of Industrial an Organizational Psychology 2004, pp 249-289,
Chichester, England: Wiley, 2004
• Sternberg, R. J.: Handbook of creativity. Cambridge Univ. Press, 1999
• Takeuchi, H. and Nonoka, J.: Hitotsubashi on Knowledge Management, Singapore: John Wiley & Sons, 2004
• Wilde, K. (2006). Constructivist Curriculum for Would-Be-Entrepreneurs’ Training. In: Braun, G. / Diensberg,
Ch. / Kadler, S. / Reichert, A. / Wilde, K. Entrepreneurship Education – Challenge for Universities in the 21
st
century. Rostock Working Papers on Economic and Human Resource Development. No. 25. Rostock. p 63-96.
7. Task
1 Describe the course atmosphere and the participants’ situation. Which problems might arise?
2 Use the attached table to derive the single participant’s strengths and weaknesses. Develop an
entrepreneurial perspective for each participant based on this table (advantages of being an Entrepreneur).
3 Test the Johari-Window on yourself and pay special attention to method-specific problems. In a next step
write a comprehensive teaching plan for introducing the Johari Window method.
4 Select two more action-learning methods and develop for each a short teaching note.
5 Make a competency analysis for yourself using the PEC-questionnaire. Develop a teaching plan to lead the
participants through this task.
6 Select 5 creativity methods for idea generation you would suggest to the participants. Explain your choice.
Explain how you would introduce these methods to the participants.
7 Different ways exist to asses the person and the ideas – the evaluation of the idea based on SWOT, the
evaluation of the idea regarding the person, the idea evaluation regarding the market evaluation. Develop a
grid with different criteria and a rating system through which the participants can evaluate their ideas.
8 Which outcomes of the idea-person-comparison are possible? Develop different strategies to cope with these
situations. Please take into consideration that at the end of your course each participant should have just one
concrete business idea.
82
Supporting Material
Supporting Material I Participants’ overview
Supporting Material II Johari Window
Supporting Material III PECS questionnaire
Supporting Material IV SWOT Analysis
Supporting Material V Alternative Business Ideas
83
Supporting Material I
Participants’ overview
84
Participant 1 Participant 2 Participant 3 Participant 4 Participant 5 Participant 6
Age
Gender
Family status
Vocational
Education
University
Education
Employment
status
Strengths
Weaknesses
Interests
Business Idea
85
Source: Shirland, Larry / Polczynski, James J. (1984). Dynamic management communication exchange: A mathematical model of
information flow through the Johari Window. In: Journal of management studies. p. 21-27.
Supporting Material II
Johari Window
86
Johari Window
Known to Self Not known to Self
Known to
Group
I
Arena
II
Blind
Not known to
group
III
Facade
IV
Unknown
Additional Explanations:
Pane I (Arena): Contains information that is known to both the individual and the group and is characterised by on
open exchange of information. The size of this pane increases as feedback occurs and information is released
from other panes.
Pane II (Blind): Contains information known to the group but not to Self. The size of this pane is an indication of
the degree that feedback is given or accepted.
Pane III (Facade): Contains information that is being withheld from the group. As trust develops, information will
flow from this pane to the Arena.
Pane IV (Unknown): Contains information unknown to both, the individual and the group. Through the feedback
process some of this information will transfer to the Facade and Blind areas as some things become known to the
individual while others become known to the group.
87
Source: CEFE – International (1998). CEFE-Manual for Trainers.
Supporting Material III
PECs Questionnaire
88
PECs self-rating questionnaire
INSTRUCTIONS
I. This questionnaire contains 55 sentences. Read each one and decide which describes you better. Be honest
to yourself! The questionnaire’s purpose is to help you to make a self-evaluation; it is no test and there is no
correct/wrong answer.
II. Choose the number associated to the sentence that best describes your behaviour:
1. never
2. seldom
3. sometimes
4. most of the times
5. always
III. Write down the chosen number beside each sentence.
See example:
No. Item Assessment
1. I keep myself calm in tense situations. 2
The person considered feels that the situation above seldom describes his/her behaviour; therefore he/she writes
the number 2 beside the sentence.
No. Item Assessment
1. I look for things that need to be done.
2. When I face a problem, I spend a lot of time trying to find a solution.
3. I do things before they become urgent.
4. I get upset when things are not done well.
5. I prefer situations in which I can control the results.
6. I like thinking about the future.
7. When I start a work or a project, I gather all possible information available.
8. I plan a big job by dividing it into several small tasks.
9. I get support by others for my suggestions.
10. I feel I will be succeeded in any activity I engage.
11. I listen carefully to any person who talks to me.
12 I do things that have to be done before others ask me to do so.
13. I insist several times to get someone to do what I want.
14. I keep my promises.
15. My results at work are better than those from people who work with me.
16. I don’t try new things without making sure I will succeed.
17. It’s a waste of time to think about what to do with one’s life.
18. I search for advice from people who know about the different aspects of my
business.
19. I carefully analyse the advantages and disadvantages of the several ways to
execute tasks.
20. I don’t spent a lot of time thinking how to influence other people’s ideas.
21. I change my way of thinking if other people strongly disagree with my point of
view.
22. I get upset, when I don’t do what I want.
23. I like challenges and new opportunities.
24. When something hinders what I am trying to do, I try to find other ways to
89
No. Item Assessment
accomplish my task.
25. I like to do other people’s work when it is necessary to accomplish a task in
time.
26. I get upset when I waste time.
27. I calculate the risk before get started.
28. The more I can express my expectations the sooner I will achieve it.
29. I often do things without looking for information concerning the task.
30. I try to anticipate all the problems that might happen and think of what can be
done in case any of them take place.
31. I seek important people to help me reach my goals.
32. When I try something difficult or something that challenges me, I feel confident
I will succeed.
33. I have failed in the past
34. I prefer to accomplish tasks that I dominate and feel safe doing.
35. When I face a great difficulty, I look for other tasks.
36. When I am doing something for another person, I make a lot of efforts so
he/she is very satisfied with my work.
37. I am never fully satisfied with the way things are done, I always think it could
be done better.
38. I do risky things.
39. I have a clear vision of where I intend to get in the future.
40. When I have to do a job for someone, I ask many questions to be sure that I
understood what he/she wants.
41. I face problems when they appear instead of anticipating them.
42. When trying to reach my goals, I look for solutions that would be positive for all
people involved.
43. I am doing a good job.
44. There have been times when I took advantage of people.
45. I try to find new tasks, different from the ones I have already done.
46. I try several ways to overcome the obstacles that disturb the accomplishment
of my goals.
47. I don’t let my work interfere with my personal life.
48. I can’t find ways of doing things faster.
49. I do things other people judge as risky.
50. Achieving my weekly goals is as much as important as achieving my annual
goals.
51. I look for different sources of information that could help me in my tasks and
projects.
52. If a way of solving a problem doesn’t work out, I try another.
53. I can change people’s opinion even with strongest points of view.
54. I stick to my decisions, even when other people strongly disagree with me.
55. I have no problems to recognize something I do not know.
90
INSTRUCTIONS SCORE SHEET
I. Write down the answer for each sentence on the lines above the correspondent number of the statement.
Note that the numbers of the statements are serial in each column.
II. Make the calculation indicated in each line to compute the points for each characteristic.
III. Sum up all the points obtained for each characteristic to obtain the total score.
Rating for the statements Score PEC
+ + - + + 6 =
(1) (12) (23) (34) (45)
_______
Searches for possibilities
+ + - + + 6 =
(2) (13) (24) (35) (46)
_______
Is perseverant
+ + + - + 6 =
(3) (14) (25) (36) (47)
_______
Knows the importance of
fulfilling tasks
+ + + - + 6 =
(4) (15) (26) (37) (48)
_______
Is aware of opportunities and
takes advantages of them
- + + + + 6 =
(5) (16) (27) (38) (49)
_______
Is risk-oriented
- + + + + 6 =
(6) (17) (28) (39) (50)
_______
Is objective-oriented
+ + + + + 6 =
(7) (18) (29) (40) (51)
_______
Searches for information
+ + - + + 6 =
(8) (19) (30) (41) (52)
_______
Makes systematic
planning and monitoring
- + + + + 6 =
(9) (20) (31) (42) (53)
_______
Is persuasive and aware of
the importance of networking
- + + + + 6 =
(10) (21) (32) (43) (54)
_______
Is self-confident
- - - + +
18 =
(11) (22) (33) (44) (55)
_______
Correction Factor
FINAL SCORE = _______________ (Entrepreneurial Profile)
91
EXCURS:
CORRECTION FACTOR FOR SELF-ASSESSMENT
I. The correction factor is used to evaluate whether someone is trying to
portray oneself to positive. When this factor scores 20 or more, the
evaluation of the entrepreneurial profile has to be corrected.
II. Use the following figures to correct the assessment.
If the correction factor scores:
Reduce each PEC score by:
24 or 25 7
22 or 23 5
20 or 21 3
19 or less 0
III. Use the following table for the corrected scores:
Profile Original score Correcting figures Corrected score
Searches for
possibilities
Is perseverant
Knows the
importance of
fulfilling tasks
Is aware of
opportunities and
takes advantages
of them
Is risk-oriented
Is objective-
oriented
Searches for
information
Makes systematic
planning and
monitoring
Is persuasive and
aware of the
importance of
networking
Is self-confident
92
PECS Self-Rating Questionnaire - Results
Profile Score
0 5 10 15 20 25
Searches for
possibilities
Is perseverant
Knows the
importance of
fulfilling tasks
Is aware of
opportunities and
takes advantages
of them
Is risk-oriented
Is objective-
oriented
Searches for
information
Makes systematic
planning and
monitoring
Is persuasive and
aware of the
importance of
networking
Is self-confident
0 5 10 15 20 25
93
Source: CEFE – International (1998). CEFE-Manual for Trainers.
Supporting Material IV
SWOT Analysis
94
SWOT Analysis of the business idea
positive factors negative factors
in the present
Strengths Weaknesses
INTERN
Technical expertise
Good network with customers
Managerial experience
Distribution system
Superior technology
No control over raw material
Limited product life
Poor design of products
Weak selling efforts
Comparatively high price
Lack of working capital
INTERN
Opportunities Threats
EXTERN
Few and weak competitors
Rising income of target market
Growing demand
Low interest in loan
Favourable government policy
Natural disaster
Raw materials shortage
Graft and corruption
Too much competition
Poor infrastructure
EXTERN
in the future
positive factors negative factors
Selection of the idea regarding the person
Idea evaluation Original idea Idea No. 2 Idea No. 3 ...
(+) Is motivating me.
(+) Reduces the relevance of my weaknesses.
(+) Based on my strengths.
(+) …
(+) …
(+) …
(+) …
(+) …
(+) …
(+) …
total
Within the control of the entrepreneur
Beyond the control of the entrepreneur
I fully agree: 5
I agree: 3
I am ambiguous: 0
I partially don’t agree: -3
I disagree: -5
95
Selection of the idea regarding the market evaluation
Idea evaluation Original idea Idea No. 2 Idea No. 3 ...
(+) Solvent demand
(+) Availability of qualified personnel
(+) …
(+) …
(+) …
(=) total
(-) Competitors
(=) Corrected Total
total
very high: 5
high: 4
moderate: 3
low: 2
imperceptible: 1
absent: 0
Competitors: 5 for many competitors, 0 for none
deduct from the total so far
96
Supporting Material V
Alternative Business Ideas
97
Alternative business ideas
The following list contains alternative business ideas for Anna.
Non-cursive lines are Anna’s ideas; cursive-lines are ideas collected by other group members.
1 Inline-Skater map 26 Event organisation
2 Internet platform for alibis 27 Holding speeches
3 Restaurant reviewer 28 Broker
4 Chocolate shop 29 Pilot
5 Personal Shopping guide for Berlin 30 Astronaut
6 Baking cakes for cafes 31 Deep sea researcher
7 Opening a Starbucks shop 32 Travel tester
8 Trend scout 33 Apartment tester
9 International expert for empirical studies 34 Service tester
10 Tester for running tracks 35 Personal trainer
11
Develop “games” for economic and business
lessons
36 Stuntwoman
12 Test driver for cars 37 Foreign correspondent
13 Organising single events 38 Detective
14 Organising Christmas parties 39 Race driver
15 Writing scripts for crime movies 40 Fidelity tester
16 Opening a health-food shop in a small city 41 ?
17 Taxi driver 42 ?
18
Correcting students’ seminar papers and degree
dissertations
43 ?
19
Designing plastic bags for dog excrements with
advertisement
44 ?
20 Friends rental service 45 ?
21 Face-Model 46 ?
22 Journalist 47 ?
23 Running trainer 48 ?
24 Politician 49 ?
25 Travel courier 50 ?
98
Appendix
„Ball Fabric“
First round
the group is forming a circle
the ball is given from one
participant to the other
First innovation
the group is moving closer
together
the participants gathered the
three balls in a box and
everybody is touching the box
Documentation
evaluation of time and failure
rate
reflection of the innovation
process
99
Importance of the Programme of
Entrepreneurship Training and Motivation
for Young Innovative Companies:
KTC Case
Assoc. Prof. Dr. Rimantas Venskus
Kaunas University of Technology, Personnel training centre
KTU Regional Science Park, Lihuania, Kaunas K.Petrausko str. 26, www.ktc.lt
Phone: +370 37 333040
Fax: +370 37 333323
Dr. Pranas Milius ([email protected]), Jurgita Sarkiene ([email protected])
KTC Case
Keywords:
entrepreneurship training, entrepreneurship motivation, entrepreneurship promotion, innovation
development, science and technology park, business incubator.
Abstract
The cumulated experience of knowledge-economy development shows that entrepreneurship training
and motivation is a very efficient and perspective organisational form, designed for the development of
high-tech industry as well as acceleration of implementation of innovations. Science and technology
parks as well as business incubators are considered to be one of organisational forms intended for
training small and medium business companies of innovations and entrepreneurship.
This work includes a short description on the history of activity of KTU Regional Science Park as well as
the experience of training entrepreneurship in Kaunas Region among novice businessmen. Summaries
of currently used programmes of entrepreneurship motivation and training are presented. Additional
initiatives that can help to more efficiently organise motivation and training of entrepreneurship as well
as processes of entrepreneurship development in the activities of science parks are discussed. This is
done with regard to the processes organisation of innovative business, purposeful investment and
constant training/learning.
100
1. Background
Promotion of enterprise is one the principal goals of economical growth, as the main tasks of the
development of the country – training of human resources, encouragement of scientific and
technological advancement as well as innovations and intellectualisation, expedition of the GDP and
reduction of social-economical exclusion among regions. All this can be achieved by being engaged in
the intense development of a network of small and medium business (SMB). The development of SMB
is inseparable from commercialisation of innovations, cooperation between small and large companies
as well as science and business, effective infrastructure of business promotion, which influence
economy and scientific development of the entire country.
The primary conditions of the SMB development, as well as enterprise, – knowledge, financial
resources and appropriate environment, which would initiate the growth and development of
companies. If knowledge is concerned, the emphasis should be put onto the spread of information on
business and access of training and consulting services. With the aim to improve the financial muscle
of the SMB subjects, am important role should be played by a well-organised and essential financial
state support. Improvement of environment – it is primarily improvement of legal and economical
environment of the SMB, considering the experience of European countries. Realisation of the three
distinguished essential conditions in order to achieve all the mentioned goals, form the essence of the
SMB strategic development (12).
Today the development and training of enterprise, or now newly called entrepreneurship have become
the priority of national innovation policy.
What are the innovations to induce entrepreneurship in the country and are they sufficient? What extra
efforts are needed to correctly organise processes of entrepreneurship training? These are relevant
questions often raising discussions in the layers of government, academic community and the society,
though not always they are given answers.
The purpose of this work – to emphasise conditions and problems of establishment, growth and
development of innovative SMB companies, considering the experience of KTU regional science park
activity, programmes that are currently being implemented as well as future perspectives; also to
discuss programmes to motivate and train entrepreneurship that are practically applied by the science
park to innovative companies of Kaunas Region.
1.1. Establishment of Promotion Structures for SMB Companies in
Lithuania
The small and medium business (SMB) in Lithuania, EU countries and other countries occupy almost
99 percent of all registered companies. Therefore, special attention from the state and promotion,
coming in the norms of competition, have a very solid weigh in expanding and strengthening SMB,
which always remains innovation-intensive and easily conforms to market changes.
There exist various promotion structures for SMB in the world. One of them is so called business
incubators (BI) that have recently spread in a number of countries; they are also called
technology/innovation centres (13).
Business incubators in developed countries come to the help for business beginners or start-ups.
Business incubators have proved their ability to help solve their problems by reducing the risk of activity
and failure of newly-established and growing companies. The concept of business incubators is rather
flexible in order to adjust to different requirements and environments. In industrial countries business
incubators started operating by promoting new technological companies. A classic business formula
starts from the initial capital, however in Lithuania it is blocked at the very beginning of a cycle: the very
idea of business establishment or development appears at the dead-point possessing no rooms,
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finances, informational background, experienced specialists and consultants, etc. Here comes again
business incubator ready to solve these problems. The purpose of a business incubator – help
establish scientific innovations as well as promote small and medium business. Here business starters
receive rooms, technical and administrative services.
The principal task of a developing country is general promotion of enterprise. As long as the main
structure of companies to function is developed, thus the basis is given for high-technology companies.
Incubators, as instruments of promotion of local economy development, have been spreading already
for several decades in the entire world. The USA is considered to be the motherland of business
incubators. In 1959, having lost their jobs in closed factories, workers started establishing small
companies. This kind of business later proved to be very successful – new workplaces were created
and occupation of residents was increasing. Business incubators are mediums for scientists’
innovations to pass into industry where they are commercialised. Therefore the USA government was
encouraging the development of this idea in the entire country. Thus, in 1959 the first business
incubator appeared in the USA.
Pioneers of European business incubators, the activity of which is based on the concept of science
parks and focuses on the promotion of new technological companies, are Heriot-Watt University in
Edinburgh (started its activity in 1969) and Cambridge University. In 1983 the first business incubator of
Germany opened its doors in Berlin. In 1986 in Latin America the first project was implemented, after
which in 1990, similar projects followed in Eastern and Central Europe after some political changes,
which allowed some possibilities for private business. At the same time business incubators started
working in Africa. Although there are huge differences among projects taken separately from seven
continents, they are united by a common goal – the promotion for start-ups.
Currently there is a great deal of such structures in the entire world: there are around 1,000 of them in
Europe. BIs become popular for they provide rooms for companies applying a flexible rent system,
enable cooperation or common use of the office or business administration services. Business
incubators mediate in order to get financial support to pay for these services.
Mid-1990s is considered to be the coming of BI in Lithuania, when the Innovation Centre of Kaunas
University of Technology, led by Dr. P. B. Milius, started upholding the idea and prepared a project of
Business incubator.
Considering the fact, that the aim of a business incubator is not to make profit but to offer help to newly
established companies, an incubator could be founded only following one law, which regulates the
establishment and activity of non-profit-making organisations. To this end, Ministry of Economy of the
Republic of Lithuania together with the Lithuanian Development Agency for Small and Medium-Sized
Enterprises prepared a model project of regulations for a public institution – Business incubator. What
is more, Ministry of Economy, considering the significance of this project to the development of the
state economy, became a founder of the first business incubator in Lithuania. Kaunas University of
Technology also supported the idea of establishment of such structure, in order scientific innovations
were actively applied in production. Thus, on June 11, 1998, after an agreement of establishment had
been signed, a public institution ‘KTU Regional Business Incubator’ was born. Kaunas University of
Technology provided the incubator with rooms in the students’ town, whereas Ministry of economy
assigned more than 2 million Lt. from the Small and Medium-Sized Business Promotion Fund for the
reconstruction of the rooms.
Currently Lithuania has 6 business incubators and 42 business information centres. Business
information centres (BIC) purvey information and consultations for businessmen and the ones willing to
start their own business. Staff of business centres provides consultations on establishment of
companies, start-up, bookkeeping, and other issues of business management. Besides, business
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centres organise seminars, trainings and events on business spread raising relevant topics for
businessmen. The majority of BIC services are free of charge or on easy terms.
Business information centres and business incubators are part of the network of institutions for
business services – a state established infrastructure for business promotion (picture 1), which would
aim at encouragement to establish and develop small and medium-sized companies as well as to
secure the access of qualitative business services provided on easy terms for businessmen of all
Lithuanian regions.
Picture 1. Network of institutions for business services in Lithuania
The results of activities of business incubators and business information centres in Lithuania show that
these structures induce country’s economical-innovative development. However, scientific and
intellectual resources of the region have a huge influence on the characteristics and results of their
activity. The BI in Šiauliai could be assigned to technologically oriented structures of SMB promotion;
BIs in other regions are basically concerned with problems of reduction of unemployment rates.
In Lithuania a business promotion infrastructure was established in the period of 1991 – 2004. This
period can be called the first stage of establishment of promotion structures for SMB companies
(business). We can have no doubt that due to this network of business promotion institutions the
problem of information shortage on start-up, management, funding, and development was solved.
2004 is considered to be beginning of the stage II of establishment of business promotion
structures, when the first structures of innovation implementation (often called ‘high-tech’ structures)
were established in Lithuania: science and technology parks (STP), innovation centres, technology
development agencies, and others (14).
The culture of science and technology parks in Lithuania started developing not long ago, although this
practice in the world has existed already for four decades. The fact that cooperation between science
and technologies was beneficial was primarily understood by the USA businessmen and scientists and
thus the first such park in the world was established in 1951 in Stanford, California State. With the help
of USA experience, STP came to Europe and other countries. Such model of business establishment
raised today well-known business giants, such as ‘Phillips’ or ‘Nokia’.
The first park in Lithuania was established only in 1993 (Public institution Science and Technology Park
in Vilnius). The second wave of establishment of science and technology parks started in 2002.
Currently in Lithuania there are 10 science and technology parks (2 are being established), which are
closely related with scientific institutions and public organisations, 2 innovation centres, Agency for
International Science and Technology Development Programmes in Lithuania (AISTDP) – these are
organisations which develop entrepreneurship, induce the expansion of innovation culture among
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scientists and businessmen, as well as they are mediums to encourage a closer cooperation between
science and business.
Companies that are engaged in performing applied researches as well as in doing other innovative
activities are established in science and technology parks (STP). STP offer special value added
services, such as business incubation, organisation of trainings, consultations, and transfer of
technologies. The principal aim of the regional STPs is to increase regional competitive ability, by
inducing culture of quality and innovations among local members, by organising transfer of knowledge
and technologies from their initial points to companies and market, also by being active in encouraging
establishment of new innovative companies.
Science and technology parks are one of the means to promote scientific researches and experimental
development, knowledge and receptive companies; also to commercialise results of researches
performed by scientific institutions.
Since we face a fast advancement of technologies, cooperation between businessmen and scientists
becomes inevitable. According to experts, such parks in Lithuania have potential not only to induce the
development of high-technology sector but also to increase competitive ability of industry and whole
economy. Besides, this will keep scientific potential and will improve culture of innovations. Lithuania is
not a country of minerals or industrial giants, so it is most beneficial to focus on inducement of
information technologies and science. Establishment and development of science and technology parks
was planned in a Long-term Strategy for Lithuanian Economic Development until 2015.
Innovation centres – not profit-making organisations, inducing innovative processes in Lithuania:
introduction of innovation in business, employment of new technologies and development of innovative
business. Innovation centres offer the following services: drawing up business plans and applications
for the EU structural funds, with the aim to implement innovative projects of companies; providing
consultations on these issues: development of national and EU promotion for innovations and business,
management of international projects, activity of companies, management of innovations, and transfer
of technologies; search for partners for common projects in business, scientific researches, and others
in Lithuania and abroad; organisation of conferences and seminars on innovation development.
The activity of science and technology parks (STP) located in Vilnius, Kaunas, Klaip?da, and Šiauliai
shows intensification of inducement of technical, technological and managerial innovations, and the
establishment of ‘spin-off’ firms, which allows hoping for perfection of unfinished scientific-exploratory
works (SEW), for the growth of interest from their authors in commercialisation of results, also for
promotion of entrepreneurship between businessmen and scientists as well as for training of
entrepreneurship. At the same time, in order to avoid the possible duplication of STP and BI activities
due to insufficient integration of these structures with scientific, training and productive structures, it is
necessary to strengthen the network of promotion for innovations/innovative entrepreneurship.
Non-financial support for innovations in Lithuania is received from state and public institutions, which
form the so called infrastructure of innovation promotion that would include the earlier-mentioned
innovation centres, science and technology parks, business incubators, business information centres,
agencies, and associative business organisations. The majority of these institutions are engaged in
implementation of innovation policy by offering special services for innovation promotion. Innovation
policy is formed and its implementation administered by Ministry of Economy, which is responsible for
innovations in business, and by Ministry of Education and Science, which is responsible for the growth
of innovation potential, development of scientific researches and partially for commercialisation of
scientific results.
During the second stage of the establishment of structures for business promotion, which continues
even today, training of entrepreneurship takes a special places. It can be maintained that it is
becoming a priority in Lithuania. Investments in education and science are growing rapidly, it is
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emphasised that a well-educated society is a guarantee of national stability; a successful economical
development determines the growth of life quality.
In order to create nuclei of science, studies and knowledge economy at international level in Lithuania,
to accelerate establishment of knowledge society and to strengthen competitive ability of Lithuania the
Government approved the concept of expansion of integrated centres (valleys) of science, studies and
business in March 2007.
The development of valleys shall be pursued using finances of the 2007-2013 European Union
structural promotion, of programmes of development of international scientific researches and
innovations, of state and municipal budgets, of participating institutions, and also of private business.
The concept of valley development has been framed as the basic element of reconstruction of
infrastructure of Lithuanian innovation system. It shall help to focus, integrate and renew the
already existing public potential of scientific researches, to enable a more effective interaction with
business and to strengthen its international competitive ability.
Places of concentration of perspective potential of scientific researches shall be identified in order to
induce effective work of valleys; territorially scattered scientific and study institutions shall be
transferred to valleys, and their concentration would create a value added, optimise their structure and
interaction, develop infrastructure, renew the equipment used for scientific researches and studies, set
up a modern base of scientific researches, create commercialisation centres, set up ‘spin-offs’ and
knowledge receptive business companies, and raise foreign investments targeted at science.
In the leading world countries a spontaneous establishment of integrated science, study and business
centres started in the sixth decade of the last century (famous Silicon Valley in the USA), and later, with
the single-minded support from various governments it spread in western Europe, Scandinavia, Japan;
currently it is spreading in China, in rising regions of the Far East and the world. The necessity of a
closer interaction between science, studies and business is also emphasised in Lithuanian long-term
strategic documents.
On October 29, 2007 a commission of integrated science, study and business centres (valleys) as well
as a united group of experts of the Science Council of Lithuania and the Lithuanian Academy of
Sciences met with the initiators of integrated science, study and business centres (valleys) who
presented their view on understanding of the so-called valleys. Visions of five valleys were introduced.
Together with the main initiators of business and science valleys – universities, business partners were
also present at the presentation of visions. According to business partners, expansion of valleys could
essentially contribute to the development of state economy, creation high technologies and
commercialisation of science results. Businessmen intend to contribute to the creation of valleys. These
common initiatives of science, studies and business will enable the Lithuanian science and study
system to single-mindedly use potential of science and studies, to renew the base of science and
studies and to apply science results to business.
The concept of integrated science, study and business centres (valleys) was approved by the
Government this spring, whereas Ministry of Education and Science and Ministry of Economy
were obliged to coordinate its implementation. On the basis of successfully functioning valleys not only
in the USA, but also in Europe, an assumption is made that the establishment of these new structures –
science valleys – in Lithuania shall induce development of innovative business and entrepreneurship
training in the country.
There is a sufficient scientific potential in Lithuania, and the country is capable of creating new
technologies and products of advanced level. According to the foreign experience, only after the main
structure of company functioning has been developed a basis for high-tech establishers is prepared.
The principal goal of Lithuania as a developing country is inducement of business development. That is
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why Kaunas University of Technology is active in solving a currently very relative problem of
development of technologically oriented small business.
Researches carried out among scientific, academic and business promotion institutions showed that
the aspects of Lithuanian scientific researches are not always related with business development and
demands; the system of science and studies still has a slow reaction towards the needs of state’s long-
term development, there is a shortage of highly qualified specialists who would meet the demands of
modern industry and business; higher schools and scientific research institutions have no interest in
creation of new innovative companies due to imperfect laws; there is a big demand for financial
resources and skilled workers; economical risk; long term to accept innovations; bureaucratic
mechanism of financing innovations; absence of bank warranties for innovations; a shortage of
specialised information; the smaller the company is and the bigger the innovation is the harder it is
implemented without an external support.
In order to solve the enumerated problems it is essential to unite initiatives of science and technology
parks and technological clusters with commercialisation of science results as well as formation of
culture of businessmen’s innovative entrepreneurship.
1.2. Initiatives and Programmes of Entrepreneurship Promotion in
Lithuania
Promotion of entrepreneurship is usually described as an interpretation and popularisation of business
processes, as well as a spread of business knowledge in the society by encouraging people to
establish private business.
Insufficient level of entrepreneurship in the society is one of the main problems of development of small
and medium sized business, covering inability of individuals or their unwillingness to begin private
business. Usually the lack of entrepreneurship is influenced by shortage of knowledge and
understanding about private business. The problem of shortage of entrepreneurship is felt in the entire
European Union and it is named as one of the principal reasons of EU economical backwardness from
the USA. Therefore, programmes of entrepreneurship promotion are an extremely popular and valuable
initiative, highly appreciable in political and business layers.
What President of European Committee Dimitris Dimitriadis emphasises in the summary of 2006–2008
programme presentation is that in order to overcome future challenges, entrepreneurship should be
induced in all layers of the society in all possible forms. Entrepreneurship is perceived in a broad sense;
this term means initiative, which is relevant for both young and older people, and covers economical,
scientific and civil activity. He claims that in the field of economy it is entrepreneurship that performs the
main role in order to overcome challenges of globalisation. Entrepreneurship cannot become merely a
simple task, for it must acquire a ‘human face’. The main goal is to preserve the European social model
which is valued in other countries of the world and develop it until it is capable of mastering threats
arising due to the world competition and demographic changes.
The level of entrepreneurship in Lithuania was in the process of fast rising up to 2001. Analysing the
change of SMB companies during the period of 2002 - 2005 it becomes clear, though marginally, that
there was a tendency of decrease of the number of start-ups (in 2001 there were 56,214 companies in
the country, in 2002 – 55,252 companies, in 2003 – 54,589, in 2004 – 55,846, and in 2005 – 56,428
companies). According to the data of the Department of Statistics under the Republic of Lithuania on
January 1, 2007 there were 59,712 small and medium sized companies in Lithuania (15).
Analysing the structure of operating SMB companies according to the kinds of economical activity of
2003–2006, the following points are noticed: fast growth of the construction sector, size stability of the
service sector, and decrease of the industrial and trade sector. The decrease of SMB companies was
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caused by the development of large shopping centres and the involved displacement of small
enterprises from the market (15).
Gross Domestic Product (GDP) is one of the essential ways of measuring the effectiveness of
economical activity of a country or a separate sector of economy. The rates of GDP growth indicate the
development of country’s economy. Lithuanian economical growth still remains one of the rapidest in
Europe – the 7.3% growth in GDP in 2004, 7.6% – in 2005, and 7.5% – in 2006 (15). The biggest
influence on such a rapid growth of economy in recent years was felt from bank credits extended on
favourable conditions, EU financial support, reduction of taxes and increase of wages, rising income of
residents and therefore increased consumption.
The part of SMB in the gross value added in 2004, as compared with 2003, increased by 0.5% and
formed 51.6%. The value of products and services created by SMB companies keeps growing every
year, which means that the role of SMB in Lithuanian economy is becoming more important (15).
Summarising the statistical data, it could be said that SMB companies constitute the largest and the
most dynamic group of companies, which creates 51.6% of the gross value added. Because of this
reason inducement of SMB companies is one of the most essential tasks of economy development, the
more especially as the principal goals of the state economy development are: to create new work
places, to strengthen the middle class, to speed up the growth of GDP, and to diminish social-
economical differences among regions. The mentioned above goals cannot be reached unless a
network of SMB companies is developed, or a favourable legal, economical and financial climate for
business development support is formed.
There has been a concern in recent years about insufficient attention paid to the development of
entrepreneurship in Lithuania. Entrepreneurship in the country is reflected by a number of business
owners for 1,000 residents of Lithuania which constitutes only 1.2 percent, whereas the average of the
European Union (EU) is more than 7 percent. These rates have placed Lithuania in the bottom of all EU
members.
Considering recommendations of the European Committee and experts as well as the present situation
in the country, new means of promotion of entrepreneurship are currently planned, which will be
financed from the state budget and the European Union Structural Funds – they are so called
science valleys, complex programmes, national science programmes, and highly advanced science
centres. The support will be available for lecturers and scientists, who are willing to improve their
academic and pedagogical competence, also for the most productive groups of scientists. In order to
achieve a better competitive ability of Lithuanian business, there is a need of extra initiatives, which
would induce business, especially small and medium; also it is necessary to establish more scientific
innovations, try to renew technologies, and make work places more effective (16). According to
members of the Confederation of Industrialists, the country must pursue an integral policy when
creating a better climate in the society, striving for intellectual nurturance (not only based on
entrepreneurship) just by teaching citizens of the country, but also by obviating obstacles for the
establishment of new enterprises. The experience of EU training of entrepreneurship as well as
formation of abilities purports that at a secondary school around 20 percent of students who participate
in the activity of ‘small enterprises’ establish their own companies after graduation.
Having estimated opinions and recommendations of experts several questions arise: what could
intensify efforts single-mindedly in this field alongside with currently applied programmes as well as
operating structures that induce entrepreneurship? What are the newest initiatives to induce
entrepreneurship which are applied practically?
National Programme of Promotion of Youth Entrepreneurship for 2007-2011 (hereinafter called –
Programme) was prepared by implementing the subsection 11.2 of the programme of means of
implementation for 2004-2008 of the Republic of Lithuania approved by a decree No. 315 by the
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Government of the Republic of Lithuania on March 24, 2005. The relevance of the programme is
grounded by legal acts and strategic documents of the European Union. Implementation of the
programme will contribute to realisation of our country’s principal strategic regulations of development –
especially in the field of education, economy, labour market, public services for business, also different
regions; upbringing of young generation should receive a lot of attention. Besides, a strategic basis to
solve problems of youth entrepreneurship has already been established. Another step that follows is to
secure its implementation.
With reference to factual data and the researches made in Lithuania, as well as to recommendations of
foreign countries, especially the European Union, and United to Nations Economic Commission for
Europe, also to the experience of the USA, Australia and Canada – countries with enormous practice of
entrepreneurship promotion for youth, the following three groups of reasons are distinguished:
1. Insufficient perception and knowledge of youth and the society about possibilities of one’s own
business;
2. A lack of appropriate assistance for youth to start and develop their own business;
3. Absence of coordination and supervision of state actions that induce entrepreneurship.
The emphasis in the programme is put on insufficient training of entrepreneurship in the system of
formal and informal education. The training of youth entrepreneurship is perceived as formation and
strengthening of entrepreneurship skills through institutions of both formal (university or higher
education, vocational training, general education) and informal (labour market vocational training,
courses, etc.) education.
Despite all efforts and strategic resolutions, training of entrepreneurship is insufficient. The survey of
university graduates has shown that they lack practical skills to start business (as indicated by 53.1
percent of respondents) and to draw up a business plan (40.9 percent). The lifelong learning strategy
maintains that comprehensive schools in Lithuania pay too small attention to train entrepreneurship
skills. More regard to this skill is paid at vocational and higher education schools – for their syllabi
include modules of entrepreneurship.
Researches of Ministry of Economy of the Republic of Lithuania show that representatives of small and
medium business do not perceive the lack of entrepreneurship knowledge as one of the principal
obstacles of business development. Banks indicate that the potential of crediting small and medium
business is used only in half. It is mostly because small businessmen are incapable of drawing up business
plans. A long-term strategy for Lithuanian Economic Development until 2015 maintains that, in spite of the
fact that the category of economically active residents with university and special secondary education
is increasing, a potential of the country’s entrepreneurship is not of the right level, and a part of
businessmen do not have an appropriate education as well as necessary experience. According to the
National Education Strategy the structure and content of education in Lithuania are not adapted to
occupation, which is proved by unemployment of youth and other age groups.
Ministry of Education and Science recommends comprehensive schools to have lessons of economy
as a compulsory subject in the 9-10 years of study, whereas in the 11-12 – as an elective one. From
1999 through 2003 the number of students of economy in the 9-12 year grew up rapidly – about 6
times. In 2003 the number of schools that had courses of economy was 68 percent from the total
number of survey participants, whereas in 2001 – 34 percent. According to the Strategy on Promoting
Economic Literacy and Entrepreneurship Education all schools in the European Union have a separate
subject on economy and almost in half of them it is compulsory. However, economy and
entrepreneurship training is not the same thing, and economy lessons at a comprehensive
school have little effect on the rise of entrepreneurship level. Meanwhile in the Lithuanian
educational system it is enough just to teach economy.
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Training of entrepreneurship at comprehensive schools is developed in accordance with the Strategy
on Promoting Economic Literacy and Entrepreneurship Education, where references to prepare
methods and means of training entrepreneurship were provided, as well as to raise teachers’
qualification. These are just general references though, and no particular means there have been
planned.
An appropriate initial assistance for youth to start business and develop it is rather important and
related with promotion for small and medium business, for companies established by young people are
often small or medium sized, and they have a right to an appropriate support. However, youth also
needs specific means since it does not have experience, start-up capital or a business idea. But no
adapted means for youth have so far been applied in Lithuania.
A great deal of researches to determine obstacles for a business start and development as well as the
quality of assistance have been carried out. A long-term strategy for Lithuanian Economic Development
until 2015 maintains that the development of business is impeded by heavy taxes, a lack of financial
resources for a start-up capital as well as business itself, insufficiently developed network of promotion
institutions, ineffective information and consultation of business, medium competence of businessmen,
too strict administrative and legal regulations, also insufficient links among companies, and uneven
business development in regions (17).
Today Lithuania has a promotion system of small and medium business, which could be considered an
example at coordinating actions of promotion of youth entrepreneurship.
This Lithuanian National Programme of Promotion of Youth Entrepreneurship for 2007-2012 as well as
a plan of means received much criticism from experts. Members of the Confederation of Industrialists
emphasise the fact that this programme almost ignores the newest EU directives and recommendations
issued from 2005 through 2007, which encourage active development of the culture of higher
entrepreneurship, creating a favourable academic environment in all levels of education. Also it defies
an encouragement to enable organisations with practical experience to contribute to the training
of entrepreneurship, to support their efforts in pursuing various programmes, to finance tentative
projects at schools, and to spread good practice.
In June 2004 Ministry of Education and Science of the Republic of Lithuania (MES/RL) approved
the Strategy on Promoting Economic Literacy and Entrepreneurship Education. It defines the
concept of entrepreneurship as a way of thinking, also as personal social, managerial and personal
competences which allow one’s knowledge to be applied in everyday life, i.e. particular abilities
enabling not only organisation of own business, but also take the risks for decisions made (18). The
aim of training of entrepreneurship is to train abilities of students. Entrepreneurship in educational
system is perceived in a broad sense and it is more highlighted as self-sufficiency, responsibility and
innovation in general.
As the strategy maintains, entrepreneurship is one of person’s competences which mostly serves for
personalisation of a human being, induces self-expression in everyday life. Entrepreneurship operates
only in activity. Thus, all the training of personality must be oriented towards a result – to nurture a
personality which is able to act independently and responsibly. A secure foundation of a business-
oriented viewpoint and entrepreneurship itself should be laid at primary, secondary and higher schools
(19).
There are initiatives in Lithuania to prepare modules of knowledge on business and entrepreneurship
and include them into syllabi of secondary, higher and university education. This is planned in
Lithuanian strategic documents – the long-term strategy for Lithuanian Development and strategic policies
of small and medium business development until 2008. Besides, Ministry of Education and Science has
implemented several projects related to application of entrepreneurship training into vocational preparation
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(finances of PHARE fund) as well as publishing of material on entrepreneurship training (a manual on
entrepreneurship basics has been published together with the British Council).
Entrepreneurship of Youth and Strategic Priorities of the Republic of Lithuania:
To strengthen the training of entrepreneurship of youth and aim at a larger number of people to
have conditions to start their own business as it is indicated in the Government programme of
2004-2008 (‘Valstyb?s Žinios’, 2004, No. 181-6703).
Strategic documents of the Republic of Lithuania highlight entrepreneurship as one of the
principal factors of a balanced growth of economy and regional development together with
knowledge, capital and labour force. This is stated in the vision of Lithuania of a long-term strategy
for the country’s development, and in the long-term strategy for Lithuanian economic development
until 2015.
In the field of education, the regulations of the state educational strategy for 2003-2012 intend to
sharpen attention to the encouragement of entrepreneurship in all levels of education. Besides, it is
necessary to train financial wisdom, form skills of entrepreneurship and basics of economic literacy
to all schoolchildren and students, as well as to adapt education to the needs of labour market.
The strategy of economic literacy and training of entrepreneurship plan adaptation of educational
content and training process of comprehensive schools to train entrepreneurship.
A lifelong learning strategy aims at establishing conditions to train entrepreneurship as one of the
main skills in the lifelong learning context in the entire system of education (including the informal
one). The activity plan of this strategy focuses on creation and implementation of continuous
vocational study programmes, which would concentrate on general abilities (including
entrepreneurship), and vocational training and continuous vocational study programmes would
evaluate social and economical as well as regional demands.
In the context of Lithuanian labour market the long-term strategy for the country’s development
perceives entrepreneurship as a political means of labour market, whereas the strategy of vocational
guidance aims at applying the training of entrepreneurship into the system of vocational guidance and
consulting.
As it is planned in the schedule of strategic policies of the country’s small and medium sized
business development until 2008 it is necessary to create a favourable environment for business
(especially legal and economical), to expand and strengthen a set of businessmen, to form a
positive image of business in the society, to establish a network of financial and non-financial
services, to create some concessions, and to encourage establishment of knowledge-based
companies. Strategic policies cover national, regional and local levels. It is extremely important to
have an adequate business development in regions, considering peculiarities, demands and
possibilities of regions, at the same time preserving particularity of each region. One of the most
important strategic policies of the country’s small and medium sized business development until
2008 is the training of human resources through the formal and informal education and consulting
and extra training system, by providing economical, managerial, financial, accounting, marketing,
and legal knowledge and abilities.
Lithuanian common programming document for 2004-2006 has also distinguished promotion of
entrepreneurship as a priority – as training of a skill and as a promotion for business (17).
There are enough programmes, strategies and initiatives of training of entrepreneurship in Lithuania,
however, majority of them are not based on practical projects; therefore their efficiency is rather low.
There is no a conventional methodology created to measure (evaluate) efficiency that would by
acceptable for scientific and business communities.
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2. The role of KTU Regional Science Park for entrepreneurship training
in Kaunas Region
2.1. Activity and Experience of KTU Regional Park
Public Institution (PI) KTU Regional Science Park (KTC) is a part of the programme of state
promotion for small and medium business (SMB), which aims at promoting entrepreneurship in the field
of high technologies, at encouragement of technology transfer processes between science and
industry, at establishment of favourable environment for business and innovations, at application of
scientific and technological achievements for regional development, at development of competitive
companies as well as the ones resistant to market changes, and lastly, at incentives to establish new
businesses and new work places. KTC is the first structure of such kind in Lithuania to offer assistance
for new business starting subjects. KTC was established on June 11, 1998. The founders of KTC are
Ministry of Economy of the Republic of Lithuania, Kaunas University of Technology and Kaunas County
Governor’s Administration. On December 11, 2006 the business incubator became KTU Regional
Science Park. Currently KTC has 19 employees - 9 of administrative and 10 of auxiliary personnel.
Since 1997, when the idea to establish the first business incubator in Lithuania originated, the
TRANSFORM programme of the German Government has greatly contributed to implementation of this
project. Until the end of the first quarter of 2000, while the TRANSFORM programme was being in
progress of application in Lithuania, Public Institution ‘KTU Regional Business Incubator’ received
around 1 million of DEM as direct investments from this programme, which were later used on training
of personnel of the business incubator as well as on interception of experience from German
technology centres by servicing technologically-oriented and young, innovative and perspective
companies. The finances were also spent on constant consultations and training of German experts in
Lithuania as well as on purchasing long-term assets, by equipping a conference hall and administration
of the business incubator with furniture and necessary special technical equipment.
The majority of foreign specialists have admitted that the project of ‘Establishment of Technology
Centre (Business Incubator) in Kaunas’ is one of the most successful among international projects
according to the TRANSFORM programme.
KTU Regional Science Park, as a promotion form of innovative and technologically-oriented small and
medium business (SMB), plays a vital role in promoting economical development of the region,
especially in improving conditions of entrepreneurship and the ones of social occupation. It should be
mentioned that by rendering appropriate promotion for newly established innovative companies as well
as by strengthening them in the process of development, a background for a new universal economical
subject to appear is created, which will later produce new items of high value added and create new
work places in the region.
Principal aims of the science park: improvement of social-economic conditions of the region by
promoting entrepreneurship in the field of high technologies and creating new work places; inducement
of application of scientific results in industry; promotion of newly established innovative and
technologically-oriented companies; inducement of development of small and medium business in the
region.
Infrastructure of KTU Regional Science Park: on December 11, 2006 Public Institution ‘KTU
Regional Business Incubator’, by a resolution of sharers, changed its title into Public Institution KTU
Regional Science Park. Judging on the achieved volume of rendered services, their complexity and
quality, the business incubator reached the rates that meet the requirements raised for science parks.
However, in order to create a universal infrastructure typical for science parks as well as to render
services that would meet demands of innovative and technologically and knowledge based business
subjects, it was necessary to re-establish the inner structure of the science park.
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The present structure of the science park consists of several interconnected subdivisions. The main
subdivision of the science park include: a pre-incubator (stage of establishment), a business incubator,
a centre of innovations and a science park. Auxiliary infrastructural subdivisions: sponsorship services
(financial mediation) and legal services (picture 2).
1. Pre-incubator: a structure, where business ideas would be ‘incubated’ and tested. The main
clients of pre-incubators are university postgraduates, scientists and specialists, who do
researches in a business sector relevant fields and search for opportunities to start their own
business by commercialising the achieved results of researches.
Premises: physically indeterminate premises, intended for generation and implementation of
ideas. Moreover, there can be ‘virtual’ rooms, when specialists work at their usual
work/research places, whereas business ideas are generated during the meetings with
consultants of the science park.
Pre-incubatory period: 6 months – from the beginning of generation of an idea till the
establishment of a juridical business subject.
This initiative of pre-incubator in the science park is at the stage of planning.
2. Business incubator (business development centre): a traditionally operating structure, which
incubates business starting SMB subjects and offers them all the necessary services needed at
the start-up. The purposive group of clients – technologically and innovatively oriented
companies, ‘spin-outs’ and ‘spin-offs’, SMB subjects that have passed the pre-incubatory
period, and other SMB subjects that were registered not earlier than 3 years ago.
Premises: physically indeterminate premises in the buildings in Student? Street 65 and
K.Petrausko Street 26. The total area intended for pre-incubation and business incubation – 40
percent of all the territory leased for companies.
Incubatory period: up to 3 years, if applying an ordinary discount of premise lease, i.e. 75%
discount – for the first year of incubation, 50% – for the second year and 25% – for the third
year.
3. Centre of innovations. Main functions: technological audit, issues of protection of intellectual
property, patenting, and monitoring as well as transfer of technologies. Make-up: regular
workers of the science park and specialists from universities and industrial companies working
under purposive employment contracts. The centre of innovations performs supervision and
selection of researches done in university laboratories, institutes and centres, audits these
researches technologically, induces commercialisation of the researches as well as
establishment of new ‘spin-outs’.
Premises: physically determinate premises in the building in Student? street 56 and
K.Petrausko street 26. Today KTU Regional Science Park is the only science park that has a
centre of innovation in its infrastructure in Lithuania.
4. Science park: a link joining together all the structure. The science park houses high-tech and
innovative companies that receive totally favourable environment to develop their own business
as well as to create new technologies and apply innovations. The purposive group of clients –
companies leaving the business incubator, ‘spin-off’ and ‘spin-out’ companies of universities
and industrial enterprises, operating in similar fields and, according to their activity profile,
capable of forming a cluster. Underlying technological fields – mechatronics and information
technologies as well as other industrial fields dominating in Kaunas Region. Companies, which
operate in the science park, do not get any discounts on premise lease nor are limitations of
premise lease term applied.
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B Ba as si is s: : s sc ci ie en nt ti if fi ic c a an nd d t te ec ch hn no ol lo og gi ic ca al l p po ot te en nt ti ia al l
A Ai im m: : k kn no ow wl le ed dg ge e- -b ba as se ed d e ec co on no om my y
(New high-tech companies, products and services, transfer of
technologies, work places)
Pre-incubator
(planned)
Centre of
Innovations
Business
incubator
Infrastructural
subdivisions:
- Financial and legal
mediation
Industry
Science and
researches
Premises: physically indeterminate premises in the buildings in Student? street 65 and
K.Petrausko street 26. The total area intended for the science park – 60 percent of all the
territory leased for companies.
Auxiliary-infrastructural subdivisions. They include:
- Financial mediation and legal services. They are private business companies that lease
premises in the science park and implement their own private goals. Form of cooperation:
mutual benefit, i.e. these companies render services for companies of the science park.
Companies of financial mediation (venture capital funds) locally find technological enterprises
that search for extra financing of the capital and invest in them.
Picture 2. Infrastructure of KTU Regional Science Park
Currently, KTC renders services of business incubation for 68 young innovative and technologically-
based companies, which employ about 480 specialists. In the run of eight years close ties were
established with Kaunas Region companies and organisations uniting them, thus informing potential
purposive groups about services rendered by KTC as well as possibilities of a start of innovative
business. KTU Regional Science Park is a member of one of the largest organisations uniting business
of Kaunas Region – Kaunas Chamber of Commerce, Industry and Crafts and Association of Kaunas
Region Industrialists and Employers. It has some cooperation agreements with Kaunas Labour
Exchange, also it cooperates intensively with Kaunas Regional Development Agency (KTC, together
with some other municipalities of Kaunas County, is one of the founders of this agency). This
determines direct participation in solving businessmen’s problems and positively influencing the
business environment of Kaunas Region.
One of the main aims of KTU Regional Science Park is to promote entrepreneurship in Kaunas
Region. In order to widely spread information on services rendered by the science park as well as
established favourable conditions for business, constant cooperation with government institutions of
Kaunas Region and associated business structures as well as scientific institutions is kept.
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Ministry of Economy of the Republic of Lithuania, Kaunas University of Technology and Kaunas County
Governor’s Administration are the founders of KTC. The latter founders play a direct role informing the
society and young specialists (university postgraduates) about opportunities to implement innovative
business ideas in KTC. This comes to close and direct mutual relations and to common and fast solving
of problems that arise for businessmen of the region.
The programme of services for innovative business is a constant and continuous process, which KTC
has been implementing since the very beginning in 1998. Currently, the science park renders services
of business information and business consultation, organises training sessions as well as events on
business spread. In order to implement the programme of innovations and competitive ability KTC has
rallied up a collective of specialists of various fields, which allows clients to receive efficient services on
many issues of innovative business.
KTU Regional Science Park contributes greatly to entrepreneurship promotion by rendering services to
businessmen and it is also instrumental in reduction of unemployment as well as occupation problem in
Kaunas Region. KTC organises events that help residents to raise their qualification and preparation for
the labour market, encourage retraining in order to adjust to the market demands and train
entrepreneurship, competitive ability and general abilities of residents of the region in order to adjust to
various changes.
To achieve this aim various activities are done: the business day festival is marked annually. During it,
KTC companies are awarded for the most substantial contribution to innovations and (or) high
technologies in Kaunas Region, for solutions of management of innovative business, etc.
Various training sessions, conferences and other events to improve companies are constantly
organised in the park. Participation is free of charge. Presence at specialised training sessions allows
businessmen to evaluate their companies from clients’ point of view, which makes much easier to
decide upon what should be improved and changed in the activity. Heads of small companies get
assistance in order to understand that both problems and success of companies are regular. It is a
system which can be managed, and most important – this could be learned.
The infrastructure of KTU Regional Science Park as well as the spectrum of rendered services and the
purposive group will definitely expand in the nearest future. This year the Government of Lithuania
approved of the national concept of KTU high-tech integrated science, studies and business centre
(valley); now its project is being drafted.
The aim of this project is to concentrate the potential of scientific researches, studies and knowledge-
receptive business in one place, to establish a common use infrastructure for scientific researches and
experimental development (SRED) and to single-mindedly pursue SRED of relevant topics for
Lithuanian economy.
Science and study institutions, scientific research institutes and business companies will be the
founders and partners of the valley. They will aim at establishing a common use infrastructure for SRED
in the territory of the valley. Some more institutions will move to the valley as well, including KTU
Institute of Physical Electronics, several science laboratories of Kaunas University of Technology and
Lithuanian Energy Institute; also a base of studies and science practice will be established there.
Science laboratories will be engaged in SRED of relevant topics for Lithuanian economy in the fields of
sustainable chemistry, mechatronics, technologies of information communication, and biochemistry.
KTU Regional Science Park takes part in the establishment of the valley. Its activity will cover the
development of the valley infrastructure as well as its maintenance and rendering of services for newly
established companies. This will secure a more efficient cooperation between science and business;
also it will encourage foundation of new companies. The valley will establish conditions for scientists
and their groups from other science and study institutions to research in the field of high technologies.
Potential of the founders is weighty: every year KTU alone fulfils around 70 percent of all economic
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orders that fall on Lithuanian universities, whereas Lithuanian Energy Institute – more than a half of
them that fall on all Lithuanian science institutes. Science and study institutions – founders of the valley
– pursue projects of the EU 6
th
Framework programme.
There is an idea (still in negotiation) to establish a Science and Study Promotion Fund for founders of
the valley and private business subjects, which will allow to financially support gifted and perspective
students and young scientists by enabling them of getting a necessary qualification, doing scientific
researches, etc.
Establishment of the valley will enhance the correlations between scientific researches and studies will
improve the quality of training of researchers and other specialists, will establish a favourable
environment for scientific knowledge and technologies to be transferred to business.
This government-supported initiative proves that the time for Kaunas University of Technology to
become a science university has come. In order Lithuanian economy faster eliminated the
backwardness from the leading EU countries, the breakthrough tendencies are associated with high
technologies. Lithuania finds the following trends of science as priorities: biotechnology, lasers,
electronics, nanotechnology and information technologies, as well as mechatronics. In the latter three
the most have been done by Kaunas Region. Kaunas academic community consists of eleven
universities and higher education schools as well as their subdivisions employing 3,168 lecturers and
almost one thousand researchers; there are more than 45 thousand students. Last year, Kaunas
people contributed to Lithuanian technological sciences by 58 percent of all scientific production,
whereas to the group of biomedicine sciences – almost by 50 percent. Kaunas pursues more than 50
projects of 111 of the EU 6
th
Framework programme, where specialists of all Lithuanian higher schools
take part (33 projects of those 50 are taken by KTU).
Breakthrough tendencies of Kaunas Region: creation of new materials and synthesis, mechatronics,
chemical industry, information and communication technologies, hydrogen energetics, micro and
nanotechnologies, biomedicine, and biomechanics. The most often heard reasons why companies
make so little investments in scientific researches and innovations are the following: imperfect
mechanisms of inducement of business investments in science and technology parks; trends of
Lithuanian scientific researches are not always related to business development and its demands; the
system of science and studies shows vague reaction to the demands of the state’s long-term
development, there is a lack of highly qualified specialists who would meet the requirements of modern
industry and business; higher education schools and institutions of scientific researches are not
interested in establishing new innovative companies due to imperfect laws; a huge demand of financial
resources and skilled employees as well as economical risk; long term to accept innovations;
bureaucratic mechanism of financing innovations; absence of bank warranties for innovations; a
shortage of specialised information; the smaller the company is and the bigger the innovation is the
harder it is implemented without an external support.
Considering the above mentioned, this initiative aims at establishing a national integrated Kaunas
science, studies and business centre (valley) by uniting efforts and focusing human and financial
resources. The valley would concentrate high-tech scientific researches done by science and study
institutions of the region, would orient them towards demands of the national business, and would
encourage to apply high technologies in the business of Kaunas Region. Initiators expect this centre
(valley) to unite all initiatives of Kaunas science and study institutions as well as the ones that promote
science and business interaction into an undivided nucleus of knowledge economy and to develop it to
an international level.
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2.2 KTC Entrepreneurship Training and Motivation Programme (case
description)
In order to start business it is not enough to have a great business idea and a wish to implement it as
fast as possible. Business start is a complex and complicated process that consists of several stages:
grounding of a business idea (it is a determination of a niche and product (service) to fulfil that niche),
evaluation of a businessman’s personal features as well as conditions of business organisation,
selection of a company’s juridical form, preparation of a business organisation project, preparation of
documents to establish a company, and registration of a company. One of the principal indicators to
start business is the exploration of a business environment. Possessing the information on business
environment and its influencing factors we can better foresee possibilities of establishment of new
business and the competitive ability of operating companies. It is proved practically that there are three
important factors determining a successful activity of a company: advantages of a new idea, skills of a
businessman and financial potential (15).
Success in small business depends greatly on abilities of a businessman, his attitudes (mentality),
business motivations, and personal features. As practice shows, small and medium companies often
fold up because of businessman’s inability to manage them. There are many characteristics necessary
for a boss in a small company but the prevailing one is a talent of undertaker, which could be described
as a sense not to consider for a long time but to make fast decisions (often with reference not to
thorough analysis of the situation, but to intuition and experience). It is also necessary know how to
convey the thoughts, give orders and control their execution.
An essential feature of SMB – constant change. Since business environment constantly changes,
companies, willing to keep and continue their activities, have to be flexible, dynamic and open. Only an
adequate reaction to environmental changes and forethought of them can guarantee the continuation of
company’s existence. This has become especially relevant in modern times, when the supply of goods
and services is rather big, and quality requirements by consumers are constantly rising. Thus, the basis
of growth, profitability, and continuation of business is the ability to supply the market with new products
and services, at the same time reducing expenditure on production and administration and searching
for new markets (15). So, application of innovations to companies becomes one of the factors
determining success.
What actually is innovative activity? It is an often case of SMB representatives to perceive innovative
activity only in its narrow sense – as application of new technologies and manufacturing of new
products. Therefore, in modern business innovative activity is recognised much broader – it is not
merely application of new technologies and manufacturing of new products, but also innovations in
management, education and design, as well as spread of information technologies. Application of
innovations in business not only gives companies the advantage over competitors, but also guarantees
a long-lasting existence of the company in market economy. Innovative activity in SMB companies is
often oriented towards the search and employment of possibilities. This means that with the aim to
meet requirements of a consumer businessmen do not necessarily create or introduce something
radically new, but also search for innovatory ideas to improve the usual activity of a company.
Company heads in modern society must be capable of combining economical and public goals. This
requires developing creativity, deepening knowledge and improving skills. Practically, people with
higher education are better at this. Businessmen having more knowledge appear to be more flexible,
stronger emotionally in critical situations and are able to better employ their intellectual abilities to solve
various problems.
Since competition in the market is rising, businessmen are forced to look for other, smarter ways to
survive and offer a consumer a necessary product or service, by using material and human resources
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very effectively. In order to secure a successful business, a businessman must deepen his
knowledge, constantly learn from what is the best and most modern in the world.
A learning businessman discovers new ways how to treat traditional things more qualitatively and
efficiently, employing competence, skills and knowledge of his employees at maximum. Various
courses, both for beginners and experienced businessmen, organised by institutions and organisations
contribute to achieving new knowledge and deepening the present one.
In the recent four years the science park has been focusing much on education of human
resources on the topic of entrepreneurship. It is constantly monitored what kind of entrepreneurship
knowledge or skills is mostly needed in the activity of companies, how their training could contribute to
the competitive ability and development of companies, also it is sought to analyse what kind of
entrepreneurship knowledge or skills is mostly lacked by different speciality students (graduates and
postgraduates) as well as how university lecturers assess demands and opportunities of
entrepreneurship training of students.
Considering a different need of training among those willing to start their own business and the ones
already having it, training sessions in the science park have been divided into two groups – a
programme of entrepreneurship training has been established (picture 3). This programme consists of
two separate parts: motivation of innovatory entrepreneurship and training of innovatory
entrepreneurship.
Picture 3. KTC actions/activities promoting entrepreneurship in Kaunas Region.
The first training cycle is more oriented towards demands of knowledge on entrepreneurship of
potential businessmen (baccalaureates and postgraduates). The purposive group of the second
training cycle of entrepreneurship programme – heads and managers of young companies as well as
all others who are thinking of establishing their own business. The aim of this training programme is
to encourage young companies to be more active, take risks, base their activities on innovations, apply
the newest and most advanced technologies, help find and exhibit the strongest personal
characteristics, and thus contribute to entrepreneurship promoting in Kaunas Region.
KTC actions/activities promoting entrepreneurship in Kaunas Region:
• Traditional assistance for young innovative companies:
- Lease of administrative/office premises in KTC under
favourable conditions; various services;
- Consultations on issues of business start;
- Forms of financial promotion for business starters;
- Assistance in preparation for and participation in national and
international exhibitions.
• Entrepreneurship training programme:
- Programme of motivation of innovatory entrepreneurship;
- Programme of training of innovatory entrepreneurship.
• Participation in activities of international and national networks
including initiatives of technological platforms and clusters;
• Partnership and implementation of international and national
projects
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KTU Regional Science Park has been organising training session for business starters since 1999. An
idea to create a systematic, purposeful and regular training programme emerged in 2004, after the
need of such trainings had been noticed. Every year the entrepreneurship training programme is
improved, renewed and offered to visitors using contemporary innovative training methods. This
programme was created by the administrative staff of the science park (director and liable managers)
together with research workers and lecturers of Kaunas University of Technology (KTU). Individual
seminars of the training programme are conducted by KTC staff, though the majority of training
sessions are conducted by KTU lecturers who possess necessary experience and who always deepen
their knowledge in a certain field. Big and professional businessmen, the so-called ‘senior
entrepreneurs’, are now and then invited to share their experience. Handover of practical experience of
‘senior entrepreneurs’ – the fastest and most efficient way to promote entrepreneurship and business.
The programme of motivation of innovatory entrepreneurship (see table 1) induces not only
establishment of commercial entrepreneurship, but also personal activeness in trying to become self-
contained by employing all opportunities and setting up the environment according to personal vision. It
is a programme, which supplements a personal ‘competence portfolio’ with lacking knowledge and
encourages visitors of the training sessions to change the status quo by themselves. Many people have
different thoughts and activity ideas, though they are incapable of identifying activity priorities. The aim
of the cycle of these motivation trainings – to help understand what kind of activity would motivate
and promote entrepreneurship, i.e. train skills, assist in finding different possibilities, raise motivation as
well as attitudes of a young man, and introduce the available promotion in the process of establishing
and developing business.
Criteria Description
Course Nb. and hours 6 courses, 48 academic hours.
Entrance criteria
-
Programme structure
1. Peculiarities of Innovatory Entrepreneurship;
2. Think Creatively. Techniques of Creative Thinking;
3. Entrepreneurship and Dynamism of Environment;
4. Entrepreneurship and Leadership;
5. SMB Promotion System and Possibilities;
6. Handover of Practical Experience of Senior Entrepreneurs.
Course time schedule
Once a week/ 6-8 hours.
Number of participants
8-12 (max 15) participants.
Table 1. The programme of motivation of innovatory entrepreneurship in KTC.
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The programme of training of innovatory entrepreneurship (see table 2) provides theoretical and
practical knowledge on marketing, financial recruitment, management of new and just-starting
companies, and training of the culture of organisation and creativity of personnel as well as
development of business based on scientific researches and experiments.
Criteria Description
Course Nb. and hours 10 courses, 80 academic hours.
Entrance criteria
-
Programme structure 1. Entrepreneurship and Innovation. Intrapreneurship;
2. Innovation and Knowledge Management. Innovation Policy. Technology
transfer between science and business enterprises;
3. Business Planning and Development. Technology Strategy Methodology and
Business;
4. Marketing Strategies. Business Internationalisation;
5. Project Management;
6. Financing Possibilities of Innovative Business;
7. Human Resource Management. Motivation. Leadership;
8. Organisational Culture and Management;
9. Intellectual Property Rights. Licensing;
10. Senior Entrepreneurs’ Stories of Success and Practical Advice (‘How to
Become Successful’).
Course type/ used methods
Courses are based on group/team work, active training methods, video material,
and discussions.
Course time schedule
Once a week/ 6-8 hours.
Number of participants
8-12 (max 15) participants.
Table 2. The programme of training of innovatory entrepreneurship in KTC.
The programme is based on the concept that knowledge should be gained not only in a seminar, but
also communicating directly with experienced businessmen, participating in practical trainings of
nurturing businessman’s personality and character, analysing practical situations, modelling business,
and working in teams.
Besides, the programme contributes greatly to the improvement of quality of business plans from the
growing number of projects from different sources (business angel networks, venture capital funds,
programmes of municipalities and business promotion agencies). Business plans, prepared in the
process of trainings, can be implemented in the KTU Regional Science Park.
In order to create the programme of training of innovatory entrepreneurship international experience in
the fields of entrepreneurship training and promoting was taken as the basis, which is believed to have
greatly influenced the demand and efficiency of entrepreneurship trainings, as compared with
analogous entrepreneurship training and promoting programmes, currently existing in the market.
This training programme contributes to the development of knowledge-based business, establishment
of new companies (especially in the priority fields of high technologies), their internationalisation,
creation and commercialisation of new products, and strengthening of links between science and
business.
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3. Current challenges/ problems facing the organization and educational
effort
In pursuance of the policy of the rapid development of integrated economy it is vital to create a
favourable climate for entrepreneurship training in the society, aiming at a change of mindset as well as
at improvement of skills and elimination of obstacles of establishment and development of new
companies. Considering this, next to the discussed and pending problems of regulation, taxes and
finances, it is advised to create and apply horizontal means for the establishment of promotion basis of
the entrepreneurship policy.
In order to more efficiently organise processes of entrepreneurship motivation and training as well as its
development in the activities of science parks it is important to consider and evaluate properly such
processes like organisation of innovative business, purposeful investment and constant training.
Innovations and entrepreneurship are not always interconnected. Due to insufficiently close
cooperation among scientific research institutions, universities and businessmen in the fields of
researches and creation of new products and technologies for the market, businessmen do not always
find innovations attractive. Usually the fields of scientific researches pass business demands and a lack
of results suitable for commercialisation is felt. Therefore, one of the most important tasks in this field is
to train entrepreneurship not merely among companies that apply innovation practically, but also
among scientists and researchers. This would significantly increase the relevance of scientific
researches towards business, would encourage researchers and scientist to be more active while
implementing tasks of technological development, and choosing research subjects, international
experience and databases would be employed.
Entrepreneurship training and investments in innovations are essential not only for high-tech
companies, but also in branches of traditional industry and service sector. An innovatory attitude
towards business management and a constant application of innovations contribute to improve labour
productivity, efficiency, quality, and at the same time – international competitive ability of a company.
Considering the low level of innovative activity of the country’s business companies, it is essential to
intensively stimulate creative innovative activity, i.e. intensify cooperation between business and
scientific research institutions, induce the development of researches done by companies and support
the establishment of technical facilities necessary for this kind of activity.
It should be mentioned that there are cases when heads of Lithuanian companies do not know that
they have some problems, which impede the development of a successful business, therefore it is
important to help find them. Entrepreneurship trainings, organised by institutions of the network of
public services to business, are often very helpful in solving problems of the lack of knowledge or skills.
Thus, accessibility of public services to business, its content and quality, conformity with demands of
business companies and business starters, is an important factor to raise the level of entrepreneurship.
A lot of national and regional means are often initiated on the basis of priorities stated in EU or national
programmes. When implementation period of these programmes is over and new ones appear, the
further pursuance of these initiatives is usually intermitted. Therefore, consultation services and training
cycles are often unfinished. As a result, when forming entrepreneurship training programmes, it is
essential to project their continuation after financial resources end up.
Application of innovations to business is basically done as adaptation of necessary technologies, but
not as creation of original knowledge or application of somewhere else created innovations. Only the
national and European long-term promotion can be helpful in creating and applying strategically
advanced innovations practically.
The Lithuanian system of means of financial promotion for SMB is not fully developed. Credit
institutions are not very active in granting micro-credits for business starting companies, there is a
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passive activity of venture capital funds in the field of sponsorship of projects created by young
innovative companies. Innovations are always related with big risk, therefore, due to the over-risky
projects, banks often refuse to finance them. In foreign countries informal individual investors –
‘business angels’ – come to help. They are ready to invest their capital in risky businesses just
appealing to their experience and interests. In Lithuania the real ‘business angels’ still do not exist,
because there are not many people who freely hold the sums bigger than 100,000 euros, thus, only
unification of ‘business angels’ can be discussed. Notably, the demands of modern business are bigger
than business patrons can offer.
Businessmen need to be prepared for management of investments, since the expenditures, necessary
for doing innovative activity, are planned easily, but the income – is not. Many businessmen lack
financial resources to order investment projects at experienced companies, thus, trainings that focus on
practical preparation are relevant and necessary. Such training sessions allow businessmen to prepare
investment projects on their own with the help of consultants.
It is not a rare case when university graduates become initiators of an innovative business. The data of
various researches indicate that graduates of American universities already know how to start their own
business; however, the ones from the EU (including Lithuania) lack the knowledge. While studying they
do not get practical knowledge, because business and technology studies are often unrelated to
practice. Therefore, universities should aim at making entrepreneurship an important part of their
syllabi, for combining entrepreneurship-based attitude and abilities acquired in science and technical
studies, students and researchers will have an opportunity to better commercialise their own ideas as
well as developed new technologies (21).
Systematic entrepreneurship training in university and college studies is also integrated into
programmes of technical disciplines. This establishes better conditions for ‘spin-offs’ and innovatory
companies to appear and helps scientific researchers gain entrepreneurship skills.
‘Spin-offs’ – companies that were established on the basis of researches done by higher education
schools – are more often emphasised as a means of strengthening the development of local economy.
However, their rates of establishment and development are very dependent on scientists’
entrepreneurship abilities. Due to some inner barriers, like a system of career, which is built on
academic achievements, the entrepreneurship of the latter at universities is not appreciated positively.
It is very important to have the necessary number of lecturers to teach entrepreneurship training
disciplines, to secure their qualification and intensify their international exchanges. Currently, innovatory
training methods of entrepreneurship are applied and constantly developed in the EU, also their
practical effect is analysed, therefore, active international interchange of this practice is available.
Having evaluated Lithuanian scientific potential, it can be stated that only a minor part of modern
technologies, which are necessary for Lithuanian companies, can be created in Lithuania. This means
that Lithuanian companies will have to purchase the vast majority of modern and competitive
technologies in other countries. The rise of such tendencies has already been noticed. To purchase
foreign technologies and apply them in our companies is a more complex task than to do the same with
local technologies. Often such a task is too complicated for Lithuanian small and medium sized
companies, which lack experience in international cooperation, transfer of intellectual property and
application of technologies. Here, the role of science parks and centres of innovations is very
significant, as are their international contacts and assistance for firms when applying for BP-7, COST,
Eureka, and other EU programmes.
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4. Conclusions
One of the principal aims of the policy of small and medium sized business development of the
Government of the Republic of Lithuania – to establish favourable conditions for new companies to
appear, to increase the rates of successfully working companies as well as their competitive abilities.
This requires government institutions to constantly observe and consider dynamically changing
situations of business companies, to review, improve and/or foresee new means of promotion,
development and inducement as well as long-term programmes for the further development of
entrepreneurship in the country.
The government, implementing the programme of small and medium sized business development,
needs to cooperate, i.e. be in a continuous relation with heads of companies and consider
businessmen’s opinion on the contemporary business environment in the country, to evaluate present
and rising problems and impediments/obstacles of business development, and on their basis to set
actions in the direction of making the applied means more efficient. Due to such a constant contact
between government institutions and business representatives, the level of entrepreneurship in the
country would much higher, because, considering positions of the Government and businessmen, it is
noted that they have different approaches on the same economical phenomena.
An entrepreneurship training system has been established and is practically applied in all levels, from
school to university. It has been conceived that schoolchildren should get information on business
opportunities from the early age. They should be taught of it as a possible future occupation. Moreover,
the main skills of entrepreneurship and creativity must be trained, as well as self-confidence in any
activity. Universities must include principles of entrepreneurship into study plans as an important part of
training programmes and encourage or even demand students to choose the courses of
entrepreneurship training (19). This initiative is a part of Lisbon strategy for growth and jobs.
Entrepreneurship – a person’s ability to implement ideas, take the initiative, be responsible, take the
risks, and pursue set tasks. In Lithuania both young and older people gradually find favourable
conditions and opportunities to improve their abilities and skills in the field of entrepreneurship. There is
a network of institutions to serve business (BI, BIC), structures of innovative business promotion (STP,
IC, AISTDP) and other advantageous initiatives are being established, such as science valleys or
technological platforms and clusters, which will intensify cooperation between science and business in
our country.
The principal reasons due to which means of entrepreneurship training are slowly developed:
- Uneven technological and managerial level of big business objects and small business
subjects;
- Not many examples of successful cooperation in international networks, which would promote
entrepreneurship training;
- Abundance of strategies and programmes does not allow the authorities to appropriately focus
on the common formation of the policy of entrepreneurship training and application of
innovations.
Insufficient level of entrepreneurship in the society is one of the main problems of development of small
and medium sized business. It should be solved by pursuing the state’s integrated policy, covering the
promotion of entrepreneurship-based attitude by coherent training and teaching of the residents as well
as the elimination of obstacles of business establishment and development. Entrepreneurship training
increases possibilities of the establishment of new companies and their self-contained activity.
122
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123
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26. Personal Opinion: Virginija B?dien?, Vice-minister of the Ministry of Education and Science,
Chairwoman of a commission of integrated science, study and business centres (valleys), 2007
124
How to Take Off?
The OURCHIP Company
Jacek Klich (Ph.D.)
Jerzy Rosi?ski (Ph. D.)
Institute of Economics and Business Management (Jagiellonian University), CITTRU
Poland, 31-387 Krakow, Gronostajowa 3
Fax: +48 12 664 69 14
Jacek Klich: [email protected]
Jerzy Rosi?ski: [email protected]
Keywords:
hi-tech companies; IT companies; financing IT companies;
Abstract
The case introduces the post-start-up stage and dilemmas pertaining to this stage of development of an
innovative, high-tech company in a southern region of Poland.
It argues that institutions for promoting entrepreneurship in the region failed to provide the entrepreneur
with adequate assistance.
This case shows that the access to financing and to highly educated programmers is of prime
importance to newly created companies operating in IT sector. Furthermore, the case underlines the
necessity of harmoniously orchestrating the activities at the meeting point of “triple helix” elements, i.e.
universities, local governments and businesses.
125
1. Background
Adam was born in Poland. He has spent most of his life in the USA where his parents emigrated in the
second half of the 1980s. He finished college there, graduated from the prestigious Massachusetts
Institute of Technology in Boston. He is now an engineer specialising in designing integrated circuits.
Willing to discover his country of origin and his parents’ homeland, Adam decided to come to Krakow
and take up post-graduate studies at the Jagiellonian University. In 2005 he completed a two-year
course in European Studies for Foreigners, in the English language. One of the modules was on the
subject of entrepreneurship and business management in post-communist countries, offering
information on opportunities awaiting foreign investors in these countries, and on the rules of private
entrepreneurship in Poland.
Upon completion of the studies, taking advantage of the opportunities he had identified for himself on
the Polish market, and particularly in Krakow, Adam seriously contemplated starting a business in
Krakow. After analyzing his personal resources- fluency in English, double citizenship (Polish and
American), expert knowledge of computer programmes and integrated circuits - and, most importantly,
armed with an idea for a business, he took steps to register his new company and start up a business.
2. Setting the stage
During his two years in Krakow Adam became acquainted with the city’s milieu, deliberating (with
varying degrees of intensity and determination) over starting up his own business.
He resolved to set up his business in Krakow and to focus on comprehensive software design and
software applications (Appendix: Business Opportunities in Malopolska voivodship).
He recognized the fact that Krakow had key resources for his future company (highly qualified
programmers), and there was a market (with excellent prospects) for such services.
In February 2006 (having considered various options and consulted lawyers in Poland and in the USA)
Adam registered OurChip, a limited liability company with a capital of 46,000 PLN. The planned strategy
of the company determined its organisational form. Namely, over the long-term, Adam’s company was
to operate globally, cooperating with large enterprises in the IT and Electronics sectors. However, he
first needed to establish a bridgehead on the Polish market (which he perceived as upwardly dynamic
and sizeable enough for the first stage of the company’s development). Once he secures a position on
the Polish market and in other post-communist countries of Central and Eastern Europe, the company
will expand overseas, primarily in the direction of the USA market, about which Adam was very
knowledgeable.
Initially Adam considered setting up his company in the USA, but he soon abandoned the idea, being
afraid that a small, unknown company registered in the USA will have more difficulties breaking through
in the local and national market. Registration of the company in Poland would generate more trust
among potential partners, who could attest to the company’s credibility with the National Court Register.
Registration of the company in February 2006 did not amount to starting up a business. At that point
Adam embarked on recruiting programmers for his team. As it turned out, the task ran counter to the
earlier assumption of an easy accessibility of highly qualified programmers.
What Adam previously considered as a favourable factor (Motorola opening its programming centre in
the special economic zone, thus expanding the market for his company’s services) turned out only to
create competition for resources - highly qualified programmers. On entering the Krakow market,
Motorola scooped up 200 programmers. The aura of a global corporation, and the tried and tested
procedures of recruitment led to a prompt and successful completion of the teams, draining the local
market of programmers.
The situation was further exacerbated by the wave of migration of the young generation of Poles to the
old UE countries (following Poland’s accession to the UE on 1
st
May 2004).
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Besides standard recruitment procedures (announcements in press and on the Internet), Adam
established contact with the head of one of the AGH (University of Science and Technology)
departments specializing in programming, and found a group of students of the final year.
After 6 months of these (and other) endeavours, Adam succeeded in securing a team of five
programmers.
Along with his ‘quest’ to complete the team (other than the recruitment process itself), Adam came up
against a series of problems, such as, e.g.:
• Working agreements with the specialists. Initially Adam did not want to employ the
specialists under standard National Labour Law regulations as, according to the Polish labour
code, employees are granted with special entitlements that burden the employer (social and
health insurance, flexi-time, days off and mandatory holidays, etc.) and curtail the employer’s
rights with regard to dissolving the said agreement. He wanted the workers to work under
contracts, which would specify duties of every worker and the remuneration based on
assignements. According to Polish Law this is feasible if the programmers register their own
business and operate as sole proprietorship entities subcontracted by OurChip. However, as
the employees were not interested in self-employment, Adam had to abandon the idea of
cooperation based on contracting and started preparing suitable work agreements which would
stipulate remuneration based on task achievement. This, however entailed yet another problem.
• Motivating workers. As the company did not sell services at this stage (vide Appendix 1), it
was too early assess the market success (sales) of the work input (programmes under
construction). Adam had to persuade the workers that their work and commitment in the
company over the first months (or even years) of the company’s operation had to be perceived
in the categories of an investment. This argumentation sounded plausible as the programmers
(specialists) did appreciate the value of the product their company was to offer (vide Appendix
2)
• Confidentiality of data. Another important issue to be considered when drawing up work
agreements pertained to intellectual property of the solutions created by the company, and
confidentiality of the circulation of the information (both internal and external). Much as these
issues (and others, not mentioned here) were of importance and had to be included in the
working agreements, Adam did not decide to employ the services of a firm specializing in
drawing up appropriate documentation. He only solicited informal advice from his
acquaintances, an economist and a lawyer among them.
3. Current challenges facing the organization
Originally, the company was to focus on all types of work relating to software and software applications.
Adam did not define the type of software product of the company, nor the sectors of economy (e.g.
software for banks, insurance companies, hospitals) nor corporate entities (small or large enterprises)
that the product offer would be addressed to. Adam admitted that his idea for business was not
accurately defined and he relied on his own ( and his employees’) flexibility and creativity, rather than on
a thorough analysis of specific sectors.
The first product to be launched was System On Chip (SoC) – an alternative to wireless
telecommunication. The product was still in the process of construction and its specifications subject to
previews.
The failure to clearly define the target group resulted in, among others, low effectiveness in hunting for
orders. The running costs incurred in the company’s operation’s (vide Appendix no. 2) made Adam
revise the strategy and orientation of the company, shifting from software design to a unique form of
technology designing electronic components.
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4. Breakthrough technology and product
OurChip Company is in possession of highly innovative technology for designing integrated circuits. By
designing the advanced integrated circuits OurChip has worked out a unique designing programme
originating from the traditional VLSI method, yet unprecedented in the electronics. The technology may
be an asset if the company launches the products based on plastic (as an alternative to electronics
using silicon), which is bound to take the market by storm and become the product leader in the years to
come.
Adam’s expertise in the field can help the design of microchips on nanomaterial board, and in
consequence, to provide end users with a product that could not have been conceived using standard
technology. At this stage the company does not have a prototype of the microprocessor. However the
product – a microcontroller on nanomaterial board - may be ready within 2-3 months.
Advantages and disadvantages of the future product
Advantages
– flexible (pliable);
– light (small weight);
– thin (thin circuit construction);
– aesthetic;
– more environment-friendly than the circuits manufactured on silicon base;
– low costs of production of the integrated circuits adapted to the needs of specific customers
(custom design).
Disadvantages
– short durability (8-18 months, depending on the materials used);
– lower efficiency, in certain respects, as compared with silicon integrated circuits
– larger board size as compared with silicon based circuits;
– as with previous boards, the source of power is still required, which may adversely affect such
advantages as: flexibility, lightness and enhanced eco-friendliness.
5. Research and development operations
The company is innovative and professional, carrying out research on technology, production and the
market. Thanks to R&D, the employees not only have their finger on the pulse of the latest changes in
the market but are also able to react accordingly.
The company’s R&D is effective, leading to satisfying results, yet it impairs proper functioning in other
areas, e.g. finance management or market research.
The company is afflicted by an ailment common for micro-enterprises – an insufficient number of
workers that specialize in other matter other than the core function of the company (in this case: other
than designing integrated circuits).
Synthetic SWAT analysis for OurChip Company produced by Adam is represented in Tab.1.
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Tab. 1. SWAT for OurChip Company
Strengths
- unique technology for designing integrated
circuits on the nanomaterial board;
- no competition in market niche of the design of
the microcontrollers based on nanomaterials;
- competent, young and highly-motivated team
of programmers and engineers;
- company’s image in line with
requirements set out by the UE support and
investment programmes aimed at supporting
innovative enterprises;
Weaknesses
- low credibility of the company, e.g. no evidence of
plausibility of the new technology,
- limited knowledge on the possibility of producing
plastic-board microcontrollers, their parameters and
properties;
- no capital available to secure uninterrupted work on
prototypes and the company’s development;
- no department responsible for finances and strategy
in this respect;
- no experience;
- no insight into mass production of plastic-board
microprocessors;
Advantages
- prospective popularity of electronics based on
plastic;
- financial support from government institutions
or business/ new technologies organizations;
- establishing cooperation with scientific bodies
interested in research on nanomaterials;
- getting an order to design
a microcontroller to a large system;
Threats
-feeble interest in designs of electronic circuits based
on plastic due to their restricted efficiency;
- low profitability of designing plastic-based circuits,
- reinforced competition in the branch or monopoly of
big corporations;
-no possibility to produce the circuit prototype or to
establish a serial production;
- OurChip microcontroller’s incompatibility with a
larger system within which it is to operate;
6. The steps taken by the company in order to gain capital
At this stage of company’s development raising capital for further development of the company featured
prominently on Adam’s list of priorities.
As early as the beginning of 2006 Adam made attempts to acquire the capital of 600-800 thousand
PLN.
The bank loan option was played down from the start as, according to the opinion shared by six bank
institutions, the company was not creditworthy and failed to present suitable credit security that the
banks evaluated to be in the range of 1.1 - 1.4 million PLN.
OurChip was not in debt, and its overhead expenses were covered from the owner’s personal
resources. Nevertheless, the company did not process any orders and did not have any income. The
company’s capital was insufficient to secure credit in the range of 600-800 thousand PLN.
Adam ventured further to raise the necessary capital. Armed with information on the well-developed
infrastructure of support for entrepreneurship in the Malopolska voivodship, and in Krakow, he
embarked (all starry-eyed) on a search of institutions and organizations that would be ready, willing and
able to assist him in getting the capital needed for the development of his highly innovative company.
Unfortunately, the first problems started to crop up as he was drawing up a list of institutions and
organizations that offering support to entrepreneurs in finding capital. Although the list of business-
related organizations in the Malopolska voivodship showcased over 57 institutions or organizations,
excluding the banking sector (Information Booklet 2006), Adam managed to identify only 12 of them. On
closer inspection the list of organizations that could (potentially) help OurChip to obtain the capital
needed was narrowed down to seven only:
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- Business Center Club Loza Malopolska
- Foundation for Economic Promotion of Krakow Region
- Centre for Innovation, Technology Transfer and University Development
- Academic Incubator of Entrepreneurship
- Micro Fund Ltd. with a branch in Krakow
- Micro Initiative Ltd.
- Malopolska Agency for Regional Development
The visits and talks in each of the organizations mentioned promptly revealed the fact that none of them
had the capacity to assist or perform intermediary functions in securing capital in the range of 600-800
thousand PLN. Moreover, despite claiming to offer counseling services (or even assistance in drawing
up project applications for EU programmes), none of the above organizations provided competent
assistance, nor information about a person or institution that would help Adam resolve the problem.
In April 2007, a financial specialist was appointed and assigned the task of preparing a list of possible
sources of capital.
The list prepared by the new employee comprised:
- resources from European Union sources (structural funds)
o Human Resources Operational Programme (B8, Z2)
o Innovative Economy Operational Programme
Priority Axis 4. Investment in Innovative Enterprise (B1, B2, B3)
Priority Axis 5. Information Dissemination.
Axis 6. Polish Economy on International Market:
- Malopolska Programme for Regional Development
- Private Equity and Venture Capital Funds
- Business Angels
- Support programmes other that structural funds:
o Industrial Development Agency (joint stock company). Innovation Centre FIRE ARP
(joint stock company).
Together with the new financial specialist, Adam started to analyse the rules and procedures of
application for resources within the structural funds of the European Union. It soon transpired that two
heads were not enough to analyse and evaluate every single programme assessing their suitability to
assist the company in getting the necessary capital.
The attempt to participate in the Malopolska Programme for Regional Development also failed.
Following a series of interviews with clerks in the Voivodship Office in Krakow, in an attempt to join the
programme, Adam was led to believe that his ‘far from impeccable Polish, and his dual citizenship
undermined the credibility of his assertions that he could run a business in Krakow at least until the year
2012.
Tired and disappointed, Adam turned his thoughts to Private Equity and Venture Capital funds. This
segment of the financial market has not been sufficiently developed in Poland and the supply of capital
is far from substantial. However, this is not the biggest problem for Adam. The problem is - should the
investor be found - Adam may face the prospect of losing independence and control over the company.
Adam still firmly believes that the new technology of integrated circuits on the plastic base has excellent
prospects, and he would like to be a part of it.
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7. Latest actions of OURCHIP
Early in 2007 the company undertook actions to set out principles of information strategy regarding the
future Our Chip product, addressed to:
a) companies operating on integrated electronic systems (potential customers)
b) investors
c) would-be employees (e.g. Financial Director, Operational Director)
As previously, OurChip does not communicate a single, accurately defined product, but only signals
‘(…) a promise addressed to the target groups’ (Communication Strategy 2007). Although the future
product of OurChip will take on the form of microcontroller, the media message will carry a wider
definition: microprocessors.
This promise translated into an advertising text which read as follows:
‘Our unique technology of designing microprocessors on a nanomaterial board enhances the products
and systems and results in a pioneer, unprecedented value for the end-user’.
8. Further Reading. Support Material. Questions and Answers.
1. What is the most serious problem looming ahead for OurChip company?
2. What mistakes has Adam made?
3. What types of dysfunction may be identified in the enterprise and business support system in
the Malopolska region? To what extent are these dysfunctions typical of the region and of
Poland, in general?
4. Which option of acquiring the resources for the development of OurChip company seems most
appealing? Why?
Ad 1)
Raising the capital prerequisite for further development of the company is not the only problem OurChip
is faced with. This problem stems from the lack of a hallmark product that could be offered to the group
of clients and investors alike. This, in turn, is connected with a lack of clearly defined strategic planning.
Ad 2)
The owner has made several mistakes:
– not defining with sufficient accuracy neither the product nor the target group
– while emphasizing the importance of technological and production research, he has neglected
market research
– not conducting an analysis of the potential integration .
Ad 3)
– insufficiently developed subsystem of financing business enterprise, especially in the area of new
technologies
– lack of coordination between institutions building the system, e.g. exchange of information, re-
directing entrepreneurs to other institutions where they could receive the assistance they require
– bureaucracy and reserved trust towards entrepreneurs
Ad 4)
Considering the limitations of the Polish system, it would seem appropriate to turn to VC and PE groups
as well as business angels. The American connections of the company owner and his familiarity with the
American financial market may be of help.
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9. Lessons learned
- in identifying certain possibilities of setting up a business operation, the entrepreneur must
accurately define the product (or service) as well as the target group
- the flexibility of the offer and focus on the client’s needs does not justify neglecting the creation of a
hallmark product or service, to gain at least borderline credibility in the eyes of the client
- to design integrated circuits it is prerequisite to set out in advance a strategy of integration
- the specific characteristics of the integrated circuits design sector make it very implausible for the
advanced projects to be realized by small, emerging companies.
10. List of additional sources
Appendix 1: Business Opportunities in Malopolska voivodship
(from:http://www.cracowonline.com/36, Business_and_Education_Opportun.htm)
The most visible feature of the Malopolska voivodship’s (Malopolska region) economy is its great
diversity. All significant branches of economy are represented here - from high technologies and
banking to chemical and metallurgical industries, coal, ore, food processing, spirit and tobacco
industries. The most industrialised city of the voivodship is Krakow. The largest regional enterprise is
operating here the Tadeusz Sendzimir Steelworks employing 17,000 people. Another major industrial
centre is located in the west, in the neighbourhood of Chrzanow (production of railway engines) and
Oswiecim (chemical works).
Tab. 2 Key figures about Malopolska region
Capital Krakow
Area 15,144 sq. km
Population
- of which urban
3,260,900
49.7%
Special Economic Zone Krakow Technology Park
Universities 18 (including: Jagiellonian University, AGH
University of Science and Technology, Krakow
University of Economics, and Krakow Technical
University) with approx. 200,000 students
Selected business supporting
organizations
Investor Assistance Centre, Krakow
Malopolska Agency for Regional Development
(joint stock company)
International airport Krakow – Balice
Main sectors IT, banking, food processing, spirits, tobacco,
chemical, coal, steel
Registered business entities
- of which with foreign capital
290 687
2 609
FDI as of December 2005 reached USD 6,840 billion. Since 2000 the Malopolska Region’s share in total
foreign investment in Poland has been highly stable, in the range of 7.3-7.6%. This tallies with the
Malopolska voivodship’s share in the GDP, which was at 7.2 - 7,5% in the same period. FDI in
132
Malopolska is diversified geographically, with Krakow, which has 23% of the voivodship population,
attracting 70 percent of FDI, mostly in trade and services. FDI is concentrated in Krakow and in the local
county areas: Krakow, Wieliczka, alongside the western borderline of the voivodship, in the counties of
Chrzanow, Olkusz and alongside national road no. 4 (from Krakow to Tarnow).
Selected foreign investors with over $1 million worth investments in Poland, present in Malopolska
voivodship:
• HVB - banking
• Kronospan Holdings Ltd. - wood and wooden products
• Saint-Gobain - glass manufacturing
• Philip Morris - tobacco processing
• Electricite de France Internationale - power, gas and water supply
• IPC - pulp and paper
• Air Liquide - chemicals and chemical products
• Pliva - pharmaceutical
• Delphi Automotive Systems - automotive
• Fleury Michon - food processing
• Carlsberg - brewing
• Man - automotive
• Becker Industrial Coatings AB - chemicals
• Electrolux - BPO - finances centre
• Royal Dutch Shell Group - BPO – finances and bookkeeping centre
Other companies have located their finance and accounting quarters in Krakow, e.g. Cap Gemini or
Lufthansa, or research centres: ABB and Delphi, or software design centre, e.g. Motorola.
Krakow
Krakow (with the population of nearly 780,000) is the scientific, administrative, financial and economic
centre of Southern Poland. It is a city with over a hundred research and development institutions, as
well as 18 universities, among others:
Jagiellonian University (number of students: over 44,000)
Selected faculties: medical analysis, biology, biotechnology, chemistry, physics, geology, information
technology, materials engineering, mathematics, law, psychology, sociology, medicine, dentistry.
AGH University of Science and Technology (number of students: over 28,500) Selected faculties:
automatics and robotics, electronics and telecommunication, geodesy and cartography, mining and
geology, information technology, materials engineering, metallurgy, chemical technology.
Krakow Technical University (number of students: over 16,000) Selected faculties: automatics and
robotics, construction, electrical engineering, technical physics, information technology, chemistry and
process engineering, mathematics, mechanics and machine construction, chemical technology.
Krakow University of Economics (number of students: over 18,500) Selected faculties: economics,
finance and banking, spatial management, information technology and econometrics, business and
marketing.
133
Krakow Academy of Agriculture (number of students: 10,000) Selected faculties: biotechnology,
economics, geodesy and cartography, environmental engineering, forestry, horticulture, agriculture,
agricultural and forestry technology, animal husbandry.
By the end of 2004 the R&D institutions in Malopolska voivodship employed over 17,000 workers, which
accounted for 13.5% of the total number of employees in the sector.
With over 60% of residents under 45 years of age, Krakow is the city of the young and well-educated
who provide a perfect environment for the development of economy and constitute a decisive factor of
the successful development of the region.
The exceptionally powerful position of Krakow as a research and scientific centre, a host of completed
investments (including infrastructural ones), the young, skilled and well-educated workforce, easy
accessibility and transport connections, and last but not least, the most exceptional atmosphere, are
among the foremost magnets for investments and business activities.
Human resources are an indubitable asset of Malopolska voivodship. Compared with other regions in
Poland, Malopolska fares better with respect to: demographic profile, society age-breakdown, situation
on the labour market, social confidence (citizenship society).
The Special Economic Zone: Krakow Technology Park
The Special Economic Zone - Krakow Technology Park was established in 1998. Its territory,
appropriated for industrial development (greenfield investment projects), covers a total area of 122.07
ha and consists of four sub-zones located in Krakow and Tarnow.
The strategic objectives of the Special Economic Zone include: development of the advanced
technology sector, in particular information technology and telecommunication networks, material
engineering, health care, medical engineering, genetic engineering, biotechnology and environmental
protection ensuring favourable economic, organisational and infrastructural conditions for domestic and
foreign investors employment of the scientific and research potential of local universities by the transfer
of the results of scientific research and advanced technologies to the industrial sector, as well as
education and training of professional staff supporting the development and restructuring of the existing
companies by the delivery of innovative technologies and organisational concepts.
The Krakow Technology Park consists of four separate areas: the 36-hectare Jagiellonian University
Technology Park, the 30-hectare Technology Park of the Krakow University of Technology, the 35-
hectare Sendzimir Steelworks Technology Park, and the youngest 21-hectare Tarnow Industrial Cluster.
The first three are situated in various corners of Krakow itself, whereas the last one has its location in
the city of Tarnow some 90 kilometers east of Krakow.
Main Investors in The Special Economic Zone - Kraków Technology Park:
• Motorola Inc. (USA)
• RR Donnelley (USA)
• AMS (USA)
• ComArch SA (Poland)
• AZ-Soft SA (Poland)
• Alcro-Beckers AB (Sweden)
• ABM SOLID SA (Poland)
134
Like in other special economic zones, entrepreneurs investing in SEZ-KTP may apply for public support,
i.e. income tax exemptions. These exemptions are granted to companies implementing investment
projects or providing new job opportunities.
Labour market
Total number of employees in the voivodship (as of August 2005), is at 2,031,000.
Numbers employed in selected sectors:
• Industry (total): 173,051
• Construction: 28,104
• Trade and repair: 87,113
• Hotels and restaurants: 8,323
• Business services including real estate: 31,759
Average monthly gross salaries in private sectors:
• industry: 2,355 PLN
• construction: 1,940 PLN
Unemployment rate in the voivodship: 14.0% (at 18,1% average in Poland)
Total number of the officially registered unemployed: 180 900
The Malopolska region has well over several dozen institutions supporting economic growth in the
region and across Poland. The agencies and foundations encompassing the entire voivodship include:
• Malopolska Agency for Regional Development (joint stock company) (MARR),
• Malopolska Agency for Energy and Environmental Management Ltd. (MAES),
• ‘Partnership for Environment’ Fund, (FRLD-MISTIA)
In 2004 in Malopolska voivodship there were 15 institutions for promotion of economic development, 21
economic organizations (economic self-government, chambers of commerce, etc.) and 17 other
organizations supporting entrepreneurship.
In 2003 in Malopolska voivodship there were 31 commercial banks, with the total of 418 branches, as
well as 5 (out of 16 in Poland) institutions offering loans:
• Fund for Economic Promotion of Krakow region
• Fund for Development of Rabka Region
• Mikro Initiative Ltd.
• Malopolska Agency for Regional Development
• Local Government Association for Entrepreneurship and Development
• In 2003 in Malopolska voivodship there were 3 funds for credit warranty, of which only one was
in Krakow (Malopolska Agency for Regional Development)
The analysis of the following key indicators of the level of competitiveness in the year 2003 placed
Malopolskie voivodship on second position as compared with Mazovian, Silesian and Pomeranian
voivodships:
• workforce headcount in research and development per 1000 population
• the ratio of investments in research and development (R&D) per 1 inhabitant,
• the ratio of investments in innovative business in industry per 1 inhabitant,
• the ratio of investment in research and development to GDP,
• the number of automated and computer-led production lines per 1000 industrial enterprises.
135
Malopolska Voivodship Strategy for Growth (excerpt)
Area 1: Active and knowledgeable society
Development of information society integrated public services on digital platforms
– mobile phone network, 3G, VoIP, digital television, Internet, etc., operating round the clock,
• system of educational services
• system of trainings for workers of public and educational institutions
• tele-information solutions enhancing social convergence and citizens’ participation in public life
(e-democracy)
• reinforced investments in research on Information and Communication Technology (ICT)
• system of support for innovation and investment in ICT branch development (including MSP)
• system of development of human resources for the sector of innovation technologies and ICT
References
Doma?ski B., Jarczewski W. (eds) ‘Climate for Investment in the Malopolska Region’, Department of
Economy and Infrastructure, Marshal Office of the Malopolska Region Krakow 2006
Grupa Stenna, ‘Pole C – Gospodarstwo, kapita?, kreatywno??, technologie’, Warsaw 25 July 2005
Information Booklet (2006) Business Organisations and Research and Development Institutions in the
Malopolska region, Krakow December 2006
OurChip Co. (2007) Communication Strategy,
Strategy for the Development of the Malopolska Region - Ma?opolska 2015, Marshal Office of the
Malopolska Region, Krakow 2006
136
Appendix 2. Financial Analysis of OurChip performance in the period of February 2006 – December 2006
ASPECT March April May June July August Sept Oct Nov Dec
1
2
3
4
Receipts from sales of services
Other receipts with surplus profit
Subsidies
(+) decreased (-) increased receivables
1820
380
-
-
2150
450
-
-
2400
380
-
- 1 000
2380
680
-
- 1200
1700
750
-
- 1300
1950
610
-
-1450
2180
610
-
-1600
3150
560
-
-1780
2850
410
-
-1950
3850
440
-
-1880
I Total receipts 1+2+3+4 2200 2600 1780 1580 1760 1100 1190 1930 1310 2410
5
6
7
8
9
Incurred costs of sales diminished by
amortization and interests
Taxes (income, VAT, and other)
Extra losses
(+) increased (-) decreased stock inventory
(+) decreased (-) increased accounts
payable
15 000
12 200
450
200
-
-
16 300
13 500
520
250
-
-
18 000
15 200
340
280
-
-
18 500
15 700
310
270
-
-
19 400
16 600
340
210
-
-
19 800
17 000
220
230
-
-
25 000
22 200
230
780
-
-
30 000
27 200
380
850
-
-
31 000
28 200
260
950
-
-
33 200
30 400
480
1100
-
-
II Total expenses 5+6+7+8+9 27 850 30 570 33 820 34 780 36 550 37 250 48 210 58 430 60 410 65 180
10
11
Interests on credit
Credit pay-off
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
III Total financial expenditure 10+11 - - - - - - - - - -
IV Net revenue I-II-III - 25 650 - 27 970 - 32 040 -33 200 -34 790 - 36 150 -47 020 - 56 500 -59 100 -62 770
12
13
14
Expenses on investment
Dividends for shareholders
Awards and other payments from profit
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
V Total expenses at the discretion of the
company owner 12+13+14
- - - - - - - - - -
15 Revenue from financial instruments (credits) - - - - - - - - - -
VI Net funds IV-V+15 -25 650 -27 970 -32 040 -33 200 -34 790 -36 150 -47 020 -56 500 -59 100 -62 770
137
Teaching Negotiation Skills
University Model Based on Entrepreneurial Experience
Jerzy Rosi?ski (Ph. D.)
Jacek Klich (Ph.D.)
Institute of Economics and Business Management (Jagiellonian University), CITTRU
Poland, 31-387 Krakow, Gronostajowa 3
Fax: +48 12 664 69 14
Jerzy Rosi?ski: [email protected]
Jacek Klich: [email protected]
Keywords
Entrepreneurial competences, post-graduate teaching
Abstract
This chapter describes assumptions and the teaching process of the course on negotiation skills as run
at the Institute of Economics and Business Management (Jagiellonian University). Being one of the
most popular workshops of studies for a B.A. degree, it is also applicable in teaching entrepreneurial
competences (known as soft skills).
Standard teaching of negotiation skills revolves around one of four approaches. This chapter suggests
which of them should be given prominence and what is best order for other approaches application to
achieve the best results. The authors also present a methodological structure of classes and possible
applications of this approach to teaching other entrepreneurial skills.
1. Introduction to the model
This chapter presents a case study of a module of a course within a tertiary education curriculum at the
Institute of Economics and Management, which was founded in 1996 and presently employs 40
academic teachers. It is an organizational unit of the Institute of Management and Social
Communication at the Jagiellonian University.
As part of such a big organisation as a university,
1
the institute has the capacity to shape the specific
teaching style, characteristic of applied sciences. However, at the same time, it has to satisfy the criteria
of academic teaching. This causes a necessity of integrating academic knowledge with a practical
approach prevalent in business.
138
Znacz?ce
emocjonalnie
prze?ycie
Activity
Applying knowledge and skills to
specific situation (personal/corporate)
osoby / organizacji
Knowledge of the type:
‘How?’
How can I use what I have learned?
Knowledge of the type:
‘What?’
What does it mean for me?
What do I know?
Emotionally
significant
experience
Active
involvement
in a task
Personal insight
Deducting
(rules, models)
Planning
implementation
The breakdown of persons participating in the course (students) is determined by the organisational
positioning of the Institute at the University, whereby the students expect to obtain ‘more’ than a mere
economic perspective of entrepreneurship, and thus are more open to content pertaining to relational
elements (e.g. as described by social psychology).
The stakeholders of the course - similarly to the ever growing majority of students of entrepreneurship-
related departments of studies, expect quick-and-ready solutions, tools adapted to the reality of the
market. More so, they expect the persons running the course to shower them with examples of
entrepreneurial activities stemming from experience of the Polish market. This tendency permeates a
wider group of students, less inclined to spare no effort to learn things by themselves (through literature
and bibliography reading) and expect the trainer to provide a ‘prêt-a-porter’ product.
2. Description of the model
Teaching negotiation skills at the Institute of Economics and Management rests on certain assumptions
(presented below) that relate to specifically designed academic courses, yet may also prove useful in
teaching so-called soft skills, inherent in mastering entrepreneurship.
Assumptions:
1. Negotiation skills largely depend on personality traits (extroversion, flexibility, conciliatory
manner). However, it is not plausible to mould personality skills in a direct way due to their
formation
2
or specific position of tertiary education institutions in human development
3
.
2. Effectiveness of adult education hinges on class structure based on the assumptions of adult
learning as defined by D.A. Kolb (Rosinski J., Rychlicka A. 2001). As this is a widely recognized
theory (Senge P. et al. 2002), we will only limit ourselves to presenting relevant reflections
pertaining to teaching adults.
The D.A. Kolb cycle model comprises 4 stages of learning and the main thesis rests on the requirement
that all four stages of the process must be completed for the process to be effective (see: illustration 1).
Illustration. 1. Learning Cycle according to D.A. Kolb (the authors’ presentation derived from Senge P.
et al. 2002)
In the light of the above it transpires that classic models of academic teaching focus on reflection
leading to the formulation of a universal model, at often ignoring the question of application of the
uncovered rules, concentrating rather on explaining of the phenomena at hand and on predicting their
future form. Classic academic model validates less contribution on the part of audience in to process of
designating meaning, and does not recognize the need of employing emotions in the process of group
learning. The academic approach focuses on dissemination of specialist and fragmented knowledge. As
139
the concentration span of the teacher lasts only ¼ of the cycle (see: illustration 3A), this leads to
awarding students representing one type of learners (see: illustration 2) - assimilators
4
.
Illustration 2. Four-stage learning cycle of D.A. Kolb. (derived from Rosi?ski J. Rychlicka A. 2001)
This learning model for entrepreneurship seems distinct from the model preferred in academic learning
(illustration 3B). An efficient entrepreneur is expected to display traits and skills typical of persons
successfully holding sales-related positions (or in sales and marketing departments) and for those
people who function effectively in positions that require social dexterity (e.g. in public relations
departments). This way of functioning is characteristic of accommodator-type
5
(see: illustration 2) - the
type standing in contrast to assimilator type, which is preferred for traditional academic learning.
In other words, by applying the traditional model we ‘generate’ successive academics, whereas we have
obvious system problems with the efficient teaching of entrepreneurs.
Illustration 3. Learning cycle of D.A. Kolb: 3A – Assimmilator learning style; 3B – Accommodator
learning style
The dilemma may be resolved by incorporating the entire cycle of D.A. Kolb into academic teaching,
which makes the classes appealing to students of all four styles of learning, and provides ground for
development of every single learner’s potential, irrespective of their future career.
Concrete Experience
Abstract
Conceptualisation
Reflective
Observation
Active
Experimentation
Converger
Diverger
Assimilator
3A
Activity
Personal
reflection
Identifying regularities
(theory, model)
Planning
implementation
Planning
implemen-
tation
Activity
Personal reflection
Identifying regularities
(theory, model)
3B
Accommodator
140
For this kind of work to be possible the teacher has to be acquainted with theoretical models and be
able to present their personal and creative interpretation.
The teacher has to display an open attitude and be ready to experiment, not to mention the dexterous
use of didactic structures suitable for group teaching.
Another attitude relates to an openness to others (derived from an openness to experience and
flexibility) – which ensures effective performance ay that stage of personal reflection. Thanks to this not
only the group listens to the teacher (in stage 3 of D.A. Kolb cycle) but also the teacher is receptive to
learners’ reflections (in stage 2 of the cycle). Listening to the opinions of the group antecedes theoretical
and synthetic conclusion. It may seem obvious but still a great number of teachers adopt a position of
an omniscient person [besserwiesser] fearing the opinions of others.
An open attitude should go hand in hand with business implementation of skills needed in presenting
this kind of knowledge.
Illustration 4. Learning cycle of D.A. Kolb: planning teaching session accounting for all four types of
learning styles.
3. Description of the application of the model
The above assumptions concerning the specifics of entrepreneurship and learner attitudes are given
consideration in a 45-hour social communication and negotiation course completed by an exam. The
course is in workshop form and the classes are run in 6-hour blocks.
Besides fulfilling the above mentioned assumptions regarding teaching, it was crucial to adopt a
methodology suitable to specific subject matter. As negotiation may be understood in
a plethora of ways, a decision had to be made on one leading approach. Four fundamental approaches
to the issue of negotiation were derived from W. Mastenbroek (1996):
• process with clearly distinct stages
• as a set of guidelines and tactics
• as persuasive communication
• as the art of ‘marrying’ the opposites and resolving dilemmas
The opening stage of the classes is built around the concept of negotiations as the art of marrying
opposites. Such an approach reinforces the attitude of the person in the negotiation process
6
. Also it
enables the introduction of core theoretical notions (e.g. negotiation style, attitude to the situation of
negotiation, BATNA).
Activity
Personal
reflection
Planning
implementation
Identifying
regularities
(theory, model)
141
The next step is that of negotiation as a process. This approach allows the creation of a map of
understanding the negotiation as specific activities taking place in time, thanks to which the participants
understand their behaviours in a wider context (time, the sequence of events, interdependence of
actions).
Only when the participants have reinforced their personal resources and once they understand the
process, are they ready for information on persuasive negotiation and on the rules and tactics involved.
Each session
7
is thus constructed to include the entire D.A. Kolb learning cycle at least twice in a 6-
hour module. Every class starts with a game/ case study / experiment, which allows a start of the cycle
of adult learning (see illustration 2) from the stage of Active Experimenting
8
. The next stage (Reflective
Observation) allows to gather reflections upon the negotiation game. Often this stage takes on a form of
discussion between the persons in a group with the teacher, taking on the role of moderator in the
discussion.
9
The next stage is that of the conclusion of the discussion, conducted by the teacher
(Abstract Conceptualisation stage – see illustration 2). It is possible to make use of a prepared
presentation, however it is more useful to make a conceptualisation on the material provided by the
participants
10
. The winding up stage (Active Experimentation) may take the form of a moderated group
discussion or brainstorming (blue-skying) on the application or a short lecture of the trainer on the
application of the knowledge.
The choice of the form of closing the learning cycle depends largely on the experience of the group.
Namely, the groups characterized by low experience (students of the first years of university) welcome
ready ideas of knowledge implementation, whereas groups with more experience (students of final
years of university have certain experience of working in various organizations of this type) the more
positive reaction of the group when invited to share their experience or to use their experience to find
application of what they have learned.
Construction of a single session of the course
To exemplify this model we may consider one of the sessions early in the course. The classes
concentrate on understanding negotiation as a way of combining opposites and resolving dilemmas.
The learning cycle starts with the experiment of the type: Caring for your business based on W.
Mastenbroek's model. The next stages of learning use games relating to all four fundamental
dimensions (dilemmas) according to Mastenbroek. Upon completion of all the games, the integration of
the model (presentation) is carried out, after which the participants embark on games reflecting simple
integrational negotiation. The games provide feedback on individual negotiation styles. As a result, not
only do the participants’ behaviours improve but they also gain new knowledge.
The model under discussion was initially based on the basis of experience of business training. The
structures – tried and tested under market situations – were cushioned by methodological reflection and
successfully implemented into academic teaching. The authors experienced in the model may apply
teaching negotiation skills and various soft skills, not only during workshops classes in the tertiary
education. The model has been applied for perfectioning the competences of teams of small medium
entrepreneurships (SMEs) whereby the employees and employers alike engaged in the learning
process. The discussed approach stands the test in relation to teams of corporations. When applying
the approach one has to remember that:
1. in the case of small medium entrepreneurships (SME’s) it is advisable to consider separating the
owners from the learning group. The owners want to ensure their money is well spent. However
their presence may often paralyze unfettered group reflection and be detrimental to the learning
process. Paradoxically, the absence of the owner at the training makes it more viable.
2. In large corporations we often come across organizational barriers hampering implementation into
everyday life the substance learned during training. Therefore undertaking courses of action
according to the discussed model does not guarantee success. When preparing the classes one
142
needs to consider the aspects of the management culture that may hamper implementation of new
skills or favour old habits and attitudes. A typical example would be an attempt to change the
attitudes of salespersons in negotiations with clients in a situation where a commission system in
the company prompts the salespersons to close the deals swiftly and to get the largest number of
clients possible, without taking into account the profit made on an individual client.
Table 1. Workshop module layout
Learning cycle stage
Specific experience Reflective observation Abstract generalization Active experimentation
Timing
(minutes)
Negotiation game:
Stock Edelweiss
11
15
Discussion moderated
by the person who runs
the workshop
20
Mastenbroek Model:
elements of negotiator’s
behaviour that affect the
‘Looking after business’
dimension – a
multimedia presentation
15
Real life examples of the
behaviours increasing
‘Looking after business’
12
10
Closing the D.A. Kolb cycle
Result:
One of the negotiation’s dimensions is grasped: ‘Looking after business’.
This understanding is combined with adequate courses of actions and backed up by experiences from the participants own
lives.
Time
60 minutes
Negotiation game
‘Sharks’ Island’
20
Moderated discussion 20
Model of Mastenbroek:
elements of negotiator’s
behaviour influencing the
dimension: ‘Building
strength’ - multimedia
presentation
15
Real life examples of the
behaviours increasing
‘Building strength’
dimension
13
5
Winding up the cycle of D.A. Kolb
Result:
Dimensions of ‘Flexibility’ and ‘Atmosphere’ are introduced, alongside the adequate course of action, additionally combined
with participants’ own experience.
Time:
60 minutes
143
Negotiation game
„The Eggs of Dodo Bird’”
10
Moderated discussion 15
Model of Mastenbroek:
elements of negotiator’s
behaviour influencing the
dimensions: ‘Flexibility’
and ‘Atmosphere’ -
multimedia presentation
25
Examples taken from
real life and from
business
10
Winding up the cycle of D.A. Kolb
Result:
Dimensions of ‘Flexibility’ and ‘Atmosphere’ are introduced, alongside the adequate course of action, additionaly combined
with participants’ own experience.
Time:
60 minutes
Negotiation game
14,15
50
Small-group discussion
of the game outcome
16
15
Presentation of the game
results on the group
forum
17
15
Conclusions regarding
application of the
desirable behaviours
observed when playing
the game.
18
10
Closing the cycle of D.A. Kolb.
Result:
The participants of the classes receive feedback on their personal negotiation style (in the categories of Mastenbroek
model) and how it affects the negotiations outcome. The participants know what behaviours affect positively the outcome of
integrational negotiation.
Time:
90 minutes
The end of the classes
4. Description of how the model can be used by other institutions or in
other situations
Undoubtedly, any application of the model in non-academic organizations may entail the necessity to
change the proportions of the realization time: less time spent on the theoretical presentation at the
simultaneous increase of time spent on presenting practical application. However it is the authors’
opinion that it is more viable to adhere to the model presented in this chapter, as those in business
organizations need reflection of a more universal character. This reflection enables them to find by
themselves a wider range of application of knowledge and skills, whereas by providing them with long
lists of ready-made solutions we may curtail their creativity. Naturally, in the learning process, the
participants have to be presented with a certain number of possible applications and references to their
life. However - metaphorically speaking - some leavening is needed for the participants to bake bread
themselves. Presenting a long list of possible applications is like serving sliced bread in a packet. No
one is interested in baking their own bread when a ready-made loaf is at hand.
144
Bibliography:
1. Mastenbroek W. Negotiations, PWN, Warsaw 1996
2. Rosi?ski Jerzy, Rychlicka Anna (2001) „W stron? uczenia przez rozwi?zywanie problemów”
(Learning Through Problem Solving) in: Borkowski T. [ed.] „Dylematy kszta?cenia mened?erów u
progu XXI wieku” (Dilemmas of the Education of Managers at the turn of the XXI
st
century),
Wydawnictwo Akademickie, Krakow
3. Senge P. et. al. Pi?ta dyscyplina, materia?y dla praktyka. Jak budowa? organizacj? ucz?c? si?.”
(The Fifth Discipline. Practitioner manual. How to Build the Learning Organisation), Oficyna
Ekonomiczna, Krakow 2002
145
Footnotes:
1
Founded in 1364 the Jagiellonian University is the oldest Polish university, presently providing education to well over
44,000 students, employing 3605 academic teachers.
2
Personality traits are saturated with elements of genetic inheritance or social inheritance (time spent in the family of
childhood)
3
The character of objectives of the organization does not allow for the forms of development based on sociotheraphy or
psychotherapy.
4
Assimilator shows propensity for making theoretical models, converging observations into integrated explanations.
Practical implementation, or the ‘human’ face of project, are less important than logical and precise theory. Weaknesses
include: intense focus on models, at the detriment of reality check; low regularity; inability to learn from experience or to
draw conclusions from mistakes committed at the implementation phase. The assimilator style is an effective strategy of
behaviour in the areas connected with information and knowledge-sharing (Rosi?ski J., Rychlicka A. 2001)
5
Accommodator learning style is ‘hands-on’. A person with preference for this style of learning is best at implementing
plans and experimenting, at wholehearted personal commitment in new experience. The person is more prone to take
risk and derives pleasure from adapting to new situations. These skills are visible in profession requiring activity and
operational talent, e.g. marketing and sales. Advantages: ability to realize plans, leadership skills, risk-taking. The
shortcomings of the style include: acting for the sake being active, insufficient focus on goal, generating too many
insignificant solutions. The plans made by accommodator are not always realistic while the deadlines are not always
kept. (Rosi?ski J., Rychlicka A. 2001)
6
Thanks to this the participants identify with the subject at the start of the course, which allows to build and maintain
strong motivation for learning.
7
Irrespective of the adopted approach to negotiation.
8
Learning cycle may commence with any stage. It is important to go through all the stages of the cycle. Persons of
resource prefer to start from Active Experimentation, which additionally gingers up commitment in groups that are task-
oriented.
9
The emotions sparked by the game may be so intense that there is no particular need to encourage others to contribute
opinions, which are voiced freely upon completion of the task.
10
The summing up stage takes more time, is ‘less sleek’ than the presentation and requires more skills on the part of the
teacher (moderator of discussions) as well as knowledge on the subject (being flexible in reacting to the changes in
substance disclosed by the reflection of the participants). However, this way of acting shows the group that the earlier
discussion and reflections are valuable – not distinct from the presentation, providing ground for the conceptualisation.
11
Negotiation games were derived from the book by W. Mastenbroek (1996)
12
The trainer shapes the discussion by providing examples from his/her own life, and then invites the participants to follow
suit. Providing 3-4 personal examples ‘sparkles the fuse’ and ignites in participants the willingness to share their own
experience.
13
This element of the cycle does not require much time as the pattern of behaviour appeared in the earlier cycle of D.A.
Kolb and by now the participants are well aware of the desirable behaviours.
14
Negotiation game may concern any subject and the scenario and should fulfil the following criteria: possible integration
solution ( satisfying interests of both parties involved), the extend of potential agreement is relatively broad, the scenario
should contain 3-5 negotiation issues (e.g. item price, total purchase amount, pay-by date, after-sales guarantees,
timetable of deliveries).
15
The game should be played in 4-person teams, where two persons are negotiating and two are observers.
16
Discussion of the game is done in 4-person groups. The persons who were observers give feedback, by using the
categories of W. Mastenbroek model, i.e. ‘Looking after Business’, ‘Building Strength’, ‘Atmosphere’, ‘Flexibility’.
17
As the negotiation game provided a broad scope for integration agreement, it is possible to compose a ranking of the
achieved results and to establish what types of behaviour (within the model) led to the advantageous solutions.
18
Discussion concerns applications in subsequent negotiation groups, everyday life situations, business negotiations.
146
doc_410027534.pdf
This detailed illustration resolve entrepreneurship teaching and promotion at and by universities.
Entrepreneurship Teaching & Promotion
at and by Universities
10 Cases
Interreg III C Network Project BEPART
(7/2004 – 12/2007; pdf by 15 Dec. 2007)
Denmark: Århus School of Business/ University of Århus
Estonia: Tallinn Technical University
Estonia: University of Tartu
Finland: Häme HAMK University of Applied Sciences
Finland: Kajaani University of Applied Sciences (2 Cases)
Germany: University of Rostock with HIE-RO
Lithuania: Kaunas University of Technology
Poland: Jagiellonian University Krakow, CITTRU (2 Cases)
BEPART is part-financed by the European Union
www.bepart.info
Content
Århus School of Business – University of Århus (Denmark)
Entrepreneurship – From Opportunity to Action – The Entrepreneurial Process
Poul Dreisler
3
Tallinn University of Technology (Estonia)
Tallinn School of Economics and Business Administration
A Case of Teaching Business Planning
Urve Venesaar, Ene Kolbre
25
University of Tartu (Estonia)
Master Program in Entrepreneurship and Technology Management:
Evaluation of the Successful Initiative in Estonia
Janita Andrijevskaja
30
HAMK University of Applied Sciences (Finland)
Competence-based Entrepreneurship Model
Entrepreneurship Incubators at HAMK University of Applied Sciences
Seija Pajari-Stylman, Heikki Hannula
40
Kajaani University of Applied Sciences (Finland)
Promoting Entrepreneurship in Kainuu
Entrepreneurship Path Cooperation Model
Päivi Malinen, Päivi Partanen
47
Kajaani University of Applied Sciences (Finland)
Business Planning 3 ECTS (Business Plan)
virtual based web – course
Pekka Tervonen
54
University of Rostock & HIERO (Germany)
ROXI Entrepreneurship Training Programme
Doreen Holtsch, Melanie Hoppe
74
Kaunas University of Technology, Regional Science Park (Lithuania)
Importance of the Programme of Entrepreneurship Training and Motivation
for Young Innovative Companies: KTC Case
Rimantas Venskus
100
Jagiellonian University, Kraków, CITTRU (Poland)
How to Take Off?
Jacek Klich, Jerzy Rosi?ski
125
Jagiellonian University, Kraków, CITTRU (Poland)
Teaching Negotiation Skills
University Model Based on Entrepreneurial Experience
Jerzy Rosi?ski, Jacek Klich
138
Editorial work: done at the University of Rostock, Chair of Business & Entrepreneurship Education (Wirtschaftspädagogik)
Publication made within the project activities of BEPART – Baltic Entrepreneurship Partners, part-financed by the EU, Interreg III C.
All information herein reflects the authors’ view only; the EU and related organizations are not liable for any use that may be made or not be made of the information.
BEPART Case – Aarhus:
Entrepreneurship – From Opportunity to Action –
The Entrepreneurial Process
Poul Dreisler
Department of Management
Aarhus School of Business / University of Aarhus
Haslegaardsvej 10
DK 8210 Aarhus V
Tel.: +45 89 48 64 64
Fax.: +45 89 48 61 25
e-mail. [email protected]
Keywords:
education, pedagogy, didactics, learning, teaching, university context, entrepreneurial
university, entrepreneurship, enterprising behaviour.
1. Executive Summary
This case will describe a specific course organised in accordance with the entrepreneurial process
model. The course is conducted by a teacher who is nearing the end of his 20-year-long involvement in
the subject field. The case starts out with a review of some of his experiences, to demonstrate that
there is a schism between didactics, pedagogy and context in relation to the subject field. It is
postulated that entrepreneurship has not found an ”intramural” place at Danish universities but to a
very large extent remains “extramural”. This leaves the universities free to ignore the much-needed
development of teaching methods, which, in essence, constitute the internal logic of the subject field. It
is further postulated that the concept, or term, entrepreneurship is its own worst enemy, because it is
so easy to either reject or isolate it as there is no tradition, scope or resources available to implement
the learning processes which are inherent in entrepreneurship and which ought to be universal. Finally,
there will be some thoughts on how teaching could be organised, based on an understanding of
’enterprising behaviour’ and the ’entrepreneurial university’.
3
2. Background
2.1. Introduction
My background section is no doubt a good deal longer and more historical than expected. I have
wished to include a (far from exhaustive) outline of the development in this area, which I have been a
part of from 1989 to the present day. There are many positive elements in this historical outline, but
also many examples of opportunities wasted.
2.2. An inter-institutional cooperation
In 1989 an informal cooperation was initiated between teachers from three HE institutions in Aarhus –
the engineering college, the school of architecture’s institute of industrial design, and the business
school, ASB. The teachers decided to set up mixed project groups for their students to carry out
projects in what was then called “product development”. The cooperation was initiated quite informally
and implemented by teachers. A teacher at the school of architecture came up with the idea; it seemed
to him that his students lacked any understanding of what it was that made Danish design world-
famous in the years between 1930 and 1970. His students considered themselves to be artists,
working for the sake of art only, as he put it. What was missing was the traditional cooperation with
furniture makers and production people in general, to make them realise what was the exact purpose of
their own work. He therefore contacted the other two institutions, starting a cooperation still existing
today; however no longer with ASB as a participant.
Since then, so many things have happened that a brief outline is called for, to explain the situation
which forms the background for the way the subject area entrepreneurship is being taught.
2.3. From product development to innovation and entrepreneurship
In the next few years, the perspective of the subject area changed into ”innovation and
entrepreneurship”. These two concepts were acquiring a special status as a number of influential
players sought to further an emerging trend in society. Among other things, the rectors of the HE
institutions, representatives from the local authority and the county along with the private institution
Danish Technological Institute had visited Chalmers University of Technology in Gothenburg and
learned about their successful initiative of offering graduate engineers courses in entrepreneurship just
before they left the university. Though greatly inspired by the visit, they failed to reach any agreement
on how to implement the idea in Aarhus. So it was parked in the Centre for Business Development
(CBD), an office for business services run by the county. Each HE institutions, the ones already
mentioned plus the University of Aarhus, appointed a representative. At twice-yearly meeting they
discussed developments and how to promote entrepreneurship at the individual institution. CBD offered
courses in entrepreneurship at the university, the engineering college and the school of architecture,
which was given additional funds for its own initiatives. ASB declined the offer as it was felt that the
school was capable of developing and implementing this subject area on its own. This resulted in the
course ”Innovation & entrepreneurship”, which has been offered ever since as part of the bachelor
programme, alongside the inter-institutional projects mentioned above, referred to as TIP projects. The
course was organised so that students could take the course in their 5
th
semester, then choose a TIP
project cooperating with designers and engineers for their bachelor thesis in their 6
th
semester. But the
teachers involved never succeeded in having a formalised framework set up, which meant that the
process was difficult to manage, and not always a success. The Danish Rectors’ Conference
nevertheless granted approx 60,000 euros in 1993 to support the initiative, in order to further inter-
4
disciplinarity. In 2003, ASB left the cooperation because it proved difficult to keep to the original idea
alive once new teachers took over. Only one teacher from ASB was ever involved in the cooperation,
and nobody else was willing to take over his commitment and hard work.
2.4. Promotion of entrepreneurship
The meetings in CBD did not lead to more cooperation, as CBD had its own reasons for offering
courses at the institutions. The courses were part of their business foundation and a means to attract
funds from the initiatives set up by the Danish government. In 1995 the government launched a
massive campaign to promote entrepreneurship. It did produce some results, but not in any
coordinated way, usually as a result of a few passionate individuals’ hard work and dedication. Some,
but not a lot of progress was made up to 2000. In 1999 ASB started a master programme in
“entrepreneurship”, run jointly by teachers from the University of Aarhus and ASB, and a course in
”Creativity and innovation management” was offered at the master programme. Since 1989 very few
staff members at ASB have been involved in research on entrepreneurship. In 1997 a research group
called RESME (Research on SMEs and Entrepreneurship) was established, including researchers and
teachers from other universities and HE institutions.
2.5. Study tour to the USA
However, 2001 finally marked a real change. The head of CBD, who had lived in California for 18
years, organised a study tour to the USA for the members of the working group meeting twice a year.
The tour included visits to Stanford and Seattle University, Entrepreneurship Centre and a number of
other places. It was during this trip that the idea of establishing a centre in Aarhus comprising all HE
institutions and supported by the county and local authority was formed: ”Aarhus – one campus for
entrepreneurship”. The idea sprang from the fact that all relevant HE institutions in Aarhus are located
within a geographical area roughly the size of the campus of Stanford University. So why not operate
as a single joint campus to promote entrepreneurship? To make a very long story short, the idea was
presented at a meeting in 2001 (shortly after the study tour). It was immediately taken up by the
administrative head of the county’s business section. In a very short time he managed to raise close to
800,000 euros from the EU’s Social Fund, whose administration was also placed in his organisation,
and he managed to raise an equivalent sum from other sources as a grant to finance Center for
Entrepreneurship (CFE) www.au.dk/da/cfe/forside for three years, starting on 1 January 2002 and
expiring at the end of 2004.
2.6. Center for Entrepreneurship
But the flying start was followed by a long and incredibly complicated process of negotiations: it soon
emerged that there were many different agendas involved here. One of the most important turned out
to be that the head of the county’s business section needed to cut his staff and budget and saw the
CFE as an opportunity to place his staff elsewhere, in an institution pursuing a good cause, and outside
his budget. The teacher/researcher representatives from ASB and Aarhus University wanted the centre
to be managed by the six HE institutions in Aarhus, and to be based on both research and education.
They found that what was being suggested was far from the idea born out of the trip to the USA. The
ensuing struggle went on and on until August 2002. CFE was officially opened on 1 December 2002 –
one year into the budget period! The management of the centre was placed in the hands of staff from
the county, and an academic council consisting of teacher representatives from the by then six
institutions associated was set up. The centre attracted an impressive board, made up of the rectors of
5
six institutions and executives from the local authority and county departments for business
development. A number of adjustments were made over the next two years but nothing that changed
the fundamental state of affairs. The centre had many visitors, who were, however, often disappointed
because the centre was not what they expected, a centre for research and education. There was no
agreement on the direction in which the centre was supposed to develop. In the end, the centre was
made part of Aarhus University, governed by its rector as an ordinary staff function, disconnected from
both the university’s research and education in the subject area. The centre is today an integrated part
of Aarhus University and has started offering credit-earning courses, usually in connection with
programmes offered by the university’s institutes. The vision statement has also been changed. Now it
says: ”It is the vision of the CFE to develop and support an innovative enterprising culture and credit-
earning enterprising competences at the University of Aarhus”. Today, the centre has no importance for
the development of entrepreneurship in education at ASB.
2.7. Yet another informal inter-disciplinary and inter-institutional
cooperation
This long historical background has been included to illustrate the basic idea that has always been the
driving force behind all development of subjects and courses for the person(s) responsible for this type
of courses: that inter-disciplinarity is vital when teaching entrepreneurship. As mentioned, this course
was launched as a cooperation between two teachers from the university and ASB, involving students
from the many institutes and subject areas covered by the two institutions. For example students from
the Institute of Molecular Biology, who took the course (as well as “Creativity and innovation
management”) as part of their study programme. Later another teacher joined the cooperation, bringing
in additional students from the humanities (Institute of Information and Media Studies). This
cooperation ran for three years, until the two university teachers were asked to promote education in
entrepreneurship at some of the university’s other humanities educations. For the last two years, the
course has been offered at ASB with an intake of 40-50 students a year; in 2006 students from ASB as
well as other universities and HE institutions in Jutland, in 2007 students from ASB only. The course is
elective and open to students from all programmes offered at ASB. From 2008 all three courses, which
have been offered since the very start, will close down when the teacher retires. Only a single new
course in entrepreneurship has been established, and there will be some some general support
(coaching) for students wishing to pursue this as a career path. In addition, ASB is attached to IDEA
(International Danish Entreprenership Academy) www.IDEA-Denmark.dk, which is a large-scale
initiative seeking to promote entrepreneurship. Among other things, they are trying to promote a
master, IMEET (International Master in Entrepreneurship Education and Training). But apart from that,
IDEA has had little influence on teaching or the development of courses at universities.
2.8. Inter-disciplinarity is formalised
Over the past two years, a lot of resources have been devoted to restructuring the universities in
Denmark. ASB has merged with Aarhus University, for example. The restructuring is the result of some
degree of political pressure on HE institutions, in an effort to create new constellations in educational
development and critical mass in research. To give a very recent example, the Dean of ASB has just
signed an agreement establishing a combined education allowing engineers to add a master degree at
the ASB, based on courses like Management of Innovation and Technology.
6
3. Case Description
3.1. Educational approaches and teaching methods
The course ”Entrepreneurship – from opportunity to action – the entrepreneurial process” is described
in detail in the appendices. The appendices have been arranged in the order in which the student will
meet them before and after choosing the course. First there is a course description, then an
introductory letter to the students, a plan and a description of the activities the student must take part
in, and finally a list of literature.
All courses taught at ASB must be described in detail in a course description outlining all aspects of the
course, to enable students to decide whether a course seems interesting or useful for their career
plans. Additionally and importantly, the course description is also a declaration in the legal sense,
informing the students of what to expect and what is expected of them. A new requirement was
introduced in 2007; students must now also be informed about the demands to be awarded the highest
grade (12) and the minimum demands to pass the exam (grade 2). The scale for grading must use the
descriptions of these two extremes as the basis for the grades in between (see course description
appendix 1).
Previously the course has been conducted with several teachers at the same time, which tended to be
difficult, especially since a former colleague was very fond of lecturing – sometimes for up to 3 lessons
of 45 minutes. The way the course is organised now there are no lecturing – at least not by the teacher.
The students work in groups, and it is part of the group’s duties to present a given text and, most
importantly, to demonstrate that they have not only understood it but are also able to see their own
practical project in the context of the literature studied. Quite often only a few of the other participants
will have read the text before classes, but afterwards they will have an overview of it and know in which
contexts it might be useful for them as well. This is evident later when they write their report, which to a
large extent includes the literature presented in class.
The course is dimensioned to give 10 ETCS, which amounts to approx 33% of the students’ workload
in a semester, including the time spent in class. The basis for this calculation is that the classes and the
project work represent the workload that the students must organise themselves within the framework
set out in the plan. If classes finish early one day, that means extra time to work on their own project or
consulting the teacher, who is also available for mail or phone consultation (see requirements for
student activities in appendix 4).
The philosophy underlying this view is self-evident. Professor Helge Löbler, University of Leipzig, has
an amusing metaphor to illustrate this point. Using what he calls a constructivist approach (Löbler,
2006), he takes his starting point in the differences between dogs and cats, referring to dog teaching
and cat’s learning to present his views on entrepreneurial education. ”The classical teaching approach
is dog teaching and this approach does not work for cats. But the constructivist approach is supporting
cat’s learning”. This distinction between teaching and learning is presented and elaborated on at the
meeting introducing the course. Obviously a certain knowledge of how cats and dogs behave is
necessary, but it is easy to find examples. Dogs do as they are told to do, and enjoy doing it. Cats do
what they think is sensible for them to do and learn from their actions, in contrast to dogs, Dr Löbler
says.
7
The introductory letter is also discussed at the first meeting. Not everybody will have replied, but many
will, making it possible to form an impression of what the students expect from the course. The majority
expect a combined theoretical and practical approach to entrepreneurship. Some attached more
importance to the practical aspects, perhaps expecting this to be the easiest way to succeed, which
turns out to be far from true.
The course, its methods and contents is based on three essential concepts or philosophies. They are
a) enterprising behaviour, b) the entrepreneurial process, and c) the student’s self-knowledge of their
own competences in relation to carrying out entrepreneurial processes. As for a), it is the course’s
objective to further the behaviour described in the course description (appendix 1 Performance
measurement). As for b), the objective is that the student learns the entrepreneurial process, as it is
described under Main topics. It is not a requirement that a business plan is drawn up. This phase is not
part of the course as such; the important thing is that a business idea is developed, and that the
concept of opportunity is fully understood. And finally it is essential that, under c), the students are able
to identify complementary competences needed for the execution of their idea. This is where the
original inter-disciplinary element comes in. It is a requirement, and a necessity, that the students seek
help and knowledge in areas where their own competences are insufficient. Groups formed voluntarily
tend to be fairly one-sided in their professional orientation, and it is usually evident that this kind of
parallel thinking is not the most productive.
3.2. The process to set up a coherent course and curriculum
The structure and content of the course has been described in appendix 3. The plan gives the students
all the information they need, allowing them to concentrate on their project work based on literature and
search for complementary competences. A very efficient and useful element of the plan is the ASB
intranet ”CampusNet”, which is an excellent tool for communication and for making articles, reports and
other material available for the teacher and the other students. As can be seen in appendix 5, a so-
called electronic compendium or collection of articles forms part of the curriculum together with the two
textbooks used. All study material is put on CampusNet, and the students make their PowerPoint slides
available here too. The teacher can add any material he finds useful and can send mails directly to all
approx. 50 students. There is also a list of links to potentially useful institutions in the area. As can be
seen, the plan and CampusNet constitute the technical basis for the process, and once in place
requires very little extra effort.
The course is based on a model developed by Scott Shane (2003), presenting his understanding of the
entrepreneurial process. The model explains the process in the following elements: Individual attitutes,
environment, entrepreneurial opportunities, discovery, opportunity exploitation and finally execution.
Not all elements are equally prominently in the course, e.g. not environment as it is assumed that
students at this level will be able to study this on their own. Execution is not always the most important
goal either. Students differ in their preferences; for some this is the most important element, especially
if they have a burning desire to start their own business. For others, the most important is to work with
the elements of the model and the course that relate to Individual Attributes and Opportunity, which is
where the business idea unfolds and is tested.
The course is not a course designed to prepare the students to start their own business when they
graduate. As stated before, the emphasis is on enterprising behaviour. This means that students will be
favourably disposed towards entrepreneurship.
8
This model provides an excellent guideline for the progression of the process. After the first meeting
introducing the course, the students have no problems accepting the roles assigned to the teacher and
students. The following classes are organised so that each session has two student presentations of
about 20 minutes, including a short overview of the main topics of the week’s literature as well as an
application of these topics on their own project. Then follows a discussion of the issues raised in the
presentation or relating to the topic in general. The discussion is lively, involving the entire class. The
role of the teacher is to facilitate the
discussion, if necessary, and to clarify any questions arising. The plan allows 2 lessons of 45 minutes
for these activities; sometimes they take up all the time, and other times there will be some time left for
individual consultations on the project or other questions.
As can be seen in the plan, three times students have to hand in papers on their group’s project work
(via CampusNet). The first relates to the idea or the topic of the group’s work, indicating their own
competences and interests, and including a brief outline of the next steps (1-2 pages). The teacher
gives summary feedback on this, helping the students to decide either to continue with the project or
reconsider it. Great importance is attached to the feasibility of the project and to the question whether
the competences needed for its execution are available.
The second paper to be handed in is about 5 pages, indicating the contours of the finished project. It is
usually at this stage that the need for help is greatest and the sustainability of the project needs to be
discussed. Feed-back is given in a workshop-like session, after all students have had a chance to
look at all projects in the folder at CampusNet to comment or offer advice. This class session is longer,
lasting 4 lessons of 45 minutes
Finally there is a last session shortly before the end of the course, which is mainly a chance to discuss
whether or not to expand on this or that aspect, or to clarify the final structure of the written report etc.
All questions on the substance of the project should have been dealt with at this stage - hopefully. This
session is organised as described above; the only difference is that there are more pages to look at.
The final report handed in by the students, and the basis on which the grade is given, is about 15
pages times the number of students in the group - between 2 and 4, on average 3. Up till now, the
exam has consisted of the teacher reading the report, giving a grade, and that was the final word. At
times students have wanted to have their grade explained, and once explained, that was usually it;
most students have a fairly accurate sense of the quality of their work. This exam form has now had to
be changed, as group exams are no longer allowed. All students must be evaluated individually, at an
oral exam. As the course would have no point whatsoever unless it leads to a written group report, the
exercise has been to construe an oral exam that makes sense. So now a group report is to be handed
in, and each member of the group will then be examined individually and orally in the report. The report
is to be considered the curriculum, and all group members must be able to answer questions on
anything in the report, including why some aspects have not been dealt with. The students will also be
expected to answer general questions on the literature used as the basis for the report. The new exam
form has not been tried yet. There is an ongoing struggle between the universities and the minister in
charge to reverse this change, because it undermines the basis of many courses and teaching
environments that have been highly successful exactly because the students work in groups, which, it
is argued, is the natural choice since it simulates the work form students will encounter after their
studies. But so far, unfortunately, to no avail.
9
3.3. Theoretical background for the process
The background for the pedagogical process is primarily Kolb´s learning cycle describing a process
which begins with concrete experience and goes over ‘observation’ to ‘reflection’ and further on to
‘forming abstract concepts’, ending with new situations. Kolb says (see Blenker et al 2006 pp 102-104)
that the learning cycle is not really a circular process, but rather “that it is a matter of a cyclic spiral:
firstly, it is often necessary to go through the four stages several times in order to fully understand the
general principles. Secondly, it is more than a cycle, because you continually progress into a more
profound discerning of the problem dealt with – as opposed to running in circles. Thus, learning to learn
seems an important aspect in entrepreneurship since an entrepreneur frequently deals with entirely
new business concepts and therefore cannot always seek advice or guidance in his network. Hence, it
is necessary to experiment on your own; and it is far from certain that your initial, immediate
understanding of the situation and the ensuing proposal for a solution will be accurate. You develop
experience, and you learn to learn”.
In addition to recommending a cyclic experience-based learning process, the model can be expanded
to encompass a representation of the way different people adopt different learning styles.
The cycle illustrates the four learning styles: concrete experience, reflective observation, abstract
conceptualisation and active experimentation.
The four learning styles differ with respect to both benefits and the individual pedagogical techniques
applied. Application of ‘the reflective theorist’ will change the student’s knowledge of the field: he
acquires the knowledge material and seeks to conform to what has been learned. The learned material
is adopted like a manual for the individual’s activities. By applying the learning style, ‘the reflective
practitioner’, you obtain changes in your way of performing an action. This is about guidelines and
advice yielding experience during a sequence of actions. The third learning style is ‘the active
practitioner’ who, according to this division, will undergo a change in skills and in his attitude towards
entrepreneurship: he adapts. Finally, there is the fourth and last learning style, ‘the active theorist’ who
during the learning process explicates or changes his perception of the phenomenon. He is the one
who gathers the threads towards an understanding of what he is involved in.
If we investigate how this division of learning styles fits in with entrepreneurship and entrepreneurs,
Garavan & O’Cinneide (1994.1: 9-10) refer to a series of studies showing that entrepreneurs prefer one
of the active learning styles. Although, they say, practice shows that the teaching and training situation
that potential entrepreneurs are most frequently exposed to is ‘the reflective theorist’. This traditional
teaching method is focused on developing the students’ conceptual terminology, and the exam will be a
matter of an ability to repeat these concepts. Learning participation is solely reflective (non-activating).
It has never been the intention to design the course description and process to fit into a particular place
in the model; but the model helps give an understanding of where you are, and where you would like to
be heading. Learning styles are not based on an outside-in understanding, but a concept associated
usually with an individual and the way they learn (cf dog teaching vs. cat’s learning). If you
nevertheless try to place the course described somewhere in the model, it will be obvious that the
course matches the ”conceptualization part” better than the ”application part”. Even if it has been the
intention to develop ”changes in skills and attitudes”, the model would probably say that the course is
closer to ”changes in understanding”.
10
3.4. The literature
The literature chosen for the course is an important part of the process. It looks like a substantial list,
and it is. It is literature at three levels: a textbook in English, with a very pedagogical structure along the
lines of Shane’s process; it is not very theory-heavy. The other textbook is in Danish, written by a
venture capitalist and entrepreneur, and it has some highly relevant ”pracademic” reflections on what it
is like to venture into the marketplace for the first time. It is a very thorough book that gives the
students a clear understanding of what it takes to make your idea a success. The third level consists of
articles and extracts from books at a higher theoretical level than the two textbooks. The purpose is to
encourage the students to read research literature on the topics they are working with. It provides a
theoretical understanding of what the textbooks are based on, which many students have stated that
they would like to have when asked why they chose the course. However, not all students get round to
reading it, but may benefit from the more hands-on practical texts. That is, much as the learning styles
mentioned above can be interpreted as individual, so the study of literature can be considered an
individual choice too. Until the change in exam form, it was accepted that the group presented their
work as a joint product, which meant that a certain division of labour was possible between the
literature/theory-inclined and the practice-oriented members of the group. This will be more difficult with
the new institutionalised individualised exam form.
4. Current challenges/ problems facing the organization/ project
experience or educational effort
Teaching at a university is a very personal activity, closely connected with the teacher’s research
interests, interests in general, age, etc. Teaching is also influenced by the climate and conditions at the
institute offering the educational activities. The ideal is cooperation based on shared attitudes towards
development, e.g a number of teachers joining forces to carry out experimenting or discipline-
transcending activities. The introductory description explaining the background for the educational
activities chosen for the course “Entrepreneurship – from opportunity to action – the entrepreneurial
process” describes how one teacher has gone through a cycle, from experimenting, crossing discipline
barriers, promoting, implementing, up to the present stage of maturity, just before retirement. A cycle
not unlike the well-known PLC curves. A development that has seen new ideas, creativity, political
infighting, professional challenges, joys and disappointments. As mentioned, when the teacher retires,
two courses in entrepreneurship will close down – leaving only one new course. This is the situation at
an institution with about 7,000 students. There are lots of things happening in environments outside
ASB, but they are not ”intramural” activities. We have got IDEA, which somehow manages to operate
without being directly anchored in the university sector. We have got CFE, who are eager to take over
formal educational activities, offering credit-earning courses. But they are not ”intramural” either. So
lots of things are happening on the entrepreneurial front in Aarhus. But there is no integration with
education, not unless the students themselves make an effort and find the relevant players – which,
fortunately, they often do. Entrepreneurship is still immensely popular. Only, there is no room for it in
the ordinary educational activities at universities and HE institutions. Entrepreneurship as an object for
learning is ”extramural”. As we are going to see later, we find ourselves in an environment marked
mainly by ”dog teaching”.
5. Further reading
See appendix 5, the e-compendium
11
6. References
Blenker, P., Dreisler P., & Kjeldsen J. (2006). Entrepreneurship Education – the New Challenge Facing
the Universities - A framework for understanding and development of entrepreneurial university
communities (Working Paper). Aarhus School of Business. Aarhus, Denmark
Blenker, P., Dreisler, P., Færgemann, H. M. & Kjeldsen, J. (2006)
Learning and teaching entrepreneurship: Dilemmas, Reflections and Strategies. In Fayolle & Klandt
(eds.) International Entrepreneurship Education: Issues and Newness, Cheltenham, UK, Edward Elgar.
Blenker, P., Dreisler, P., Færgemann, H. M. & Kjeldsen, J. (in press)
A Framework for entrepreneurship education in a university context
Int. J. of Entrepreneurship and Small Business, Vol. 5 No. 1, 2008
Garavan, T. N. & O’Cinneide, B. (1994.1): ”Entrepreneurship Educa-
tion and Training Programmes: A Review and Evaluation – Part 1”,
Journal of European Industrial Training, vol. 18 (8): 3-12, 1994.
Kolb, D. A. (1984). ”Experiential Learning”. New York: Prentice-Hall, 1984.
Löbler, H. (2006). Learning Entrepreneurship from a Constructivist Perspective. Technology Analysis &
Strategic Management, Vol. 18, No. 1, 19-38,
Shane, S. (2003). A general theory of entrepreneurship. The Individual-opportunity nexus. Cheltenham,
UK, Edward Elgar
7. Appendicies
APPENDIX 1.: Course description
APPENDIX 2.: Introductory letter 2007
APPENDIX 3 a.: Plan for: Entrepreneurship – opportunity to action – the entrepreneurial
process.
APPENDIX 3 b.: Plan for: Entrepreneurship – opportunity to action – the entrepreneurial
process.
APPENDIX 4.: Explanatory notes on participant activities and report requirements.
APPENDIX 5.: e-compendium. Articles and extracts from books.
12
APPENDIX 1. Course description
25319 Entrepreneurship – from opportunity to action - the entrepreneurial process
Language: Danish
Duration: 1 semester. 10 ECTS / 27 lessons total (variable number of lessons per week)
Relations to other courses
The course is related to most of the courses taught in business studies. The course forms a good basis
for participation in the Venture Cup, which starts officially at the same time as the course and runs
parallel with the third and fourth semester of the master programme. The first phase ends in January
with a prize of DKK 10,000 awarded to the best business plan. More information at
www.venturecup.dk.
Aim of the course
During as well as after their studies, many students will be involved in business development within
existing organisations or they may wish to start their own business.
The aim of the course is to give the students the intellectual tools to approach such tasks, and to give
them insight into and competences in entrepreneurship in practice through own projects and reflection
on the projects. It is an integrated part of the course aim that the students contribute towards the
creation of learning situations that further the competences required to fulfil the aim of both this specific
course and of the study area in general – ie, the development of ’enterprising behaviour’.
Background of the course
The background of the course is the well-established fact that there is a widespread need for
innovation and entrepreneurship in the European economy; and Denmark is no exception. The study
area aims not only to motivate and educate students to start their own business but generally to
develop a certain kind of behaviour, referred to in literature as enterprising behaviour – a concept which
in a Danish context was first used in Bang & Olufsen’s vision statement in 1925.
Main topics of the course
The key objective of the course is to identify and clarify various elements of the concept
’entrepreneurship’ through the students’ own projects based on field studies. These projects will enable
the students to carry out and understand the various elements characterising ‘the entrepreneurial
process’ or method, from ’pre-idea to startup’, including:
- analysis of own competences in order to establish limitations and need for input of external
resources
- carrying out sector/business analysis to spot potential for entrepreneurial activity
- investigating why, when and how business opportunities arise
- achieving an understanding of how such opportunities can be utilized
- demonstrating how the entrepreneurial process can transform a business opportunity into a
business idea
- demonstrating a sense of reality when transforming business idea into action.
Teaching
At the start of the semester, there will be an introduction to the sequence of course activities and
planned progression. There will also be an introduction to the main topics of the course listed above.
13
The students will be divided into groups on the basis of any wishes expressed in advance and
professional background. Classes will take their starting point in the presentation of the students’ own
projects. Time will be allocated to preparation of a group project, to be supported, among other things,
through feedback workshops.
Active participation is expected in all activities, presentations, group work and workshop meetings
throughout the semester.
Performance measurement; qualifications and competences
The course gives the students a profound insight into the skills related to analysis and interpretation of
business areas and an ability to spot and create opportunities for developing new business ideas. The
course also gives the students an insight into their own strengths and weaknesses, to identify any
competences the students may need but not possess themselves.
Creativity and innovation are key concepts for developing ideas, and critical and analytical methods
essential for evaluation of the sustainability of ideas. These elements will also form part of the course;
and finally the course will encourage and develop the students’ competences within cooperation and
communication.
Evaluation criteria:
A description of grade 12:
The student demonstrates extensive and profound knowledge of the subject and/or extensive and
profound skills relating to the subject. As this is a course for entrepreneurship, and not in
entrepreneurship, great importance will be attached to extensive knowledge of concepts and methods
and, not least, extensive skills in applying such concepts and methods.
The student must be able to compare or combine concepts, methods and information in a mature and
realistic way, and apply his/her knowledge/skills on known problems in a highly confident way, and as
far as unknown problems are concerned, by combining knowledge acquired and well-known principles
in such a way that realistic potential solutions are produced.
Description of grade 2:
The grade 2 means passed – just. The grade is given for an adequate performance which
demonstrates that the student has fulfilled the minimum requirements for understanding, knowledge
and skills for the report to pass.
The ability to combine concepts, methods and skills is at a very modest level. No attempt has been
made to establish realism in the report (i.e., there is lack of practical considerations), and no attempt
has been made to enlist the help and support of complementing competences.
Recommended literature
to be announced later.
In addition to text books, an electronic compendium of articles will be made available via the library and
CampusNet.
Exam form
A group report of max 15 pages per person. Each student will be examined individually in the report
and in the course curricula in general.
One overall grade will be given.
14
APPENDIX 2. Introductory letter 2007
Aarhus, 21 August 2007
For the students enrolled in the course
” Entrepreneurship – opportunity to action – the entrepreneurial process” Autumn 2007
Dear Student
Classes will be held according to the following plan:
Tuesdays from 12.00 to 13.40 in room M104 during weeks 36-44 (week 42 autumn holiday)
Tuesdays from 8.00 to 9.40 in room M205 during weeks 45-50
Classes may, however, be cancelled some weeks, e.g. to allow time for longer workshop activities. A
detailed plan will be put on CampusNet later.
This course is designed as a course primarily in or for entrepreneurship; it is, however, also a
theoretical course on entrepreneurship. You will be given an introduction to the subject area and
theories on entrepreneurship; but for most of the course you will be expected to work independently.
That is to say, you are expected to work with your own ideas in a way which makes you able to act
more entrepreneurially in your everyday life. The role of theory in this process is to encourage you to
reflect on your own work in relation to entrepreneurial processes.
It is part of the aim of this course that you work in a group on a project chosen and designed by the
group itself.
The participants are expected to form groups of a maximum of 4 persons, and ideally group formation
should be based on shared interests and goals. Participants who have not found a group by the start of
the semester will be expected to join one in the course of the first two weeks.
To learn more about your intentions and reasons for enrolling in this course, I would like you to reflect
on the following:
Are you primarily interested in entrepreneurship as a theoretical phenomenon – ie, are you interested
mainly in the aspects of the course focusing on entrepreneurship? This interest can have different
starting points: it can be an economic-theoretical interest in the role of the entrepreneurial function in an
economy, or it can spring from a psychological-sociological interest in the particular type of person
driven by spotting new opportunities.
Are you primarily interested in entrepreneurship as a personal phenomenon – and therefore mainly
attracted to the aspects of the course relating to ” in” or ”for” entrepreneurship? Perhaps you have
certain entrepreneurial ambitions but feel you lack something before you dare take the plunge? This
could be something very concrete such as knowledge on how to draw up a business plan for an idea
you already have – or it could be something less concrete, such as a sense of lacking a framework
within which to narrow down the potential business opportunities to pursue.
15
And finally your may be motivated by certain specific interests, which can also take many different
forms – such as an interest in the interface between entrepreneurship and finance – or between
entrepreneurship and the new (experience) economy – or potential interfaces between
entrepreneurship and aesthetics or other non-economic activities – or something entirely different.
I would like to learn a bit more about your reasons for taking this course before our first meeting on 4
September - specifically in relation to the above. Would you therefore be kind enough to send me ½ to
¾ of an A4 page on your reflections? Please mail it to the mail address below no later than 1
September.
Your input will be used to prepare the introductory meeting on 4 September, but also to form groups
whose participants share the same goals for their learning outcome of the process. (I would prefer as
many groups as possible to be established prior to our meeting on 4 September).
The exam in this course involves writing a group project report followed by an oral exam, cf the rules
for this type of exam. As you may know, the rules now call for an individual oral exam; more about that
at our first meeting.
If you have any question before we meet on 4 September, do not hesitate to contact me at the mail
address below.
When you send in the page with your reflections, please make sure to include the following information:
Full name:
Specialized study abbreviation (such as mar, sol etc):
Has previously followed entrepreneurship courses: no / yes - If yes: please specify:
Enrolled at (only if other than ASB):
Yours sincerely
Associate Professor
Poul Dreisler, PhD
Aarhus School of Business /
University of Aarhus
Department of Management
[email protected]
Literature for the course:
Hougaard, Søren: Forretningsidéen – om iværksættelsens tidligste faser. Samfundslitteratur, seneste
udgave. (The business idea – The early stages of entrepreneurship, Springer Verlag 2005)
Rae, David: Entrepreneurship – from opportunity to action. Palgrave Macmillan 2007
In addition, extracts from books and links to articles for use in the classes are available on CampusNet
(under shared folders)
16
APPENDIX 3 a.:
Plan for:
Entrepreneurship – opportunity to action – the entrepreneurial process
APPENDIX NO 3 b.:
Plan for:
Entrepreneurship – opportunity to action – the entrepreneurial process
WEEK no DATE THEME TEXTS PRESENTATION
group no / name
PARTICIPANT ACTIVITY
36 4 Sep Introduction /
Formation of
groups
Intro letter and the texts forwarded
Articles on pedagogy and
sequencing of activities:
Shane: A general theory of…
Poul Dreisler
Formation of groups and
scheduling of the
semester’s activities
37 11 Sep Cancelled:
conference in
Cambridge
Cancelled Cancelled Field and project work
38 18 Sep I.1 Individual
Attributes /
Networks
Hougaard: chap 1
Sarasvathy: What makes ….
Rae chap 2
3 / the teamsters
6 / spezialisterne
Presentation and class
discussion based on own
interest and understanding
39 25 Sep I.2 Individual
Attributes /
Networks
Burt: The Network Entrepreneur…
Forbes et al: Entrepreneurial team
formation
Rae chap 3
7 /The Tertius
9 / ASB_MVP
Presentation and class
discussion based on own
interest and understanding
Handing in theme report I
40 2 Oct Cancelled: project
meeting in Rostock
cancelled Cancelled Field and project work
41 9 Oct II.1
Entrepreneurial
Opportunities /
Discovery
Hougaard: chap 2 & 3
Sarasvathy et al: Three views of
entrepreneurial opportunity.
Rae chap 4
5 / M
12 / SCD
Presentation and class
discussion based on own
interest and understanding
42 16 Oct Autumn holiday Autumn holiday Autumn holiday Autumn holiday
44
30 Oct The Halfway
Presentation
Own work All Presentation and
discussion of
halfway report
4 lessons
45 6 Nov III.1 Opportunity
Exploitation
Hougaard chap 4 – 6
Rae chap 5
4 /Inno-teach
2 / SMB
Presentation and class
discussion based on own
interest and understanding
46 13 Nov III.2 Opportunity
Exploitation
Abell: chap 1, 2, 7
Dimov. Dimo: From opportunity
insight to Opportunity Intention.
8 / 3E
10 / SuLo
Presentation and class
discussion based on own
interest and understanding
47 20 Nov IV.1 Execution Hougaard: chap 7-8
Rae chap 6 + 7
13 / no name
14 /kampusians
Presentation and class
discussion based on own
interest and understanding
48 27 Nov IV.2 Execution Rae chap 8 + 9
Cherwitz et al: Intellectual
entrepreneurship
?
?
Presentation and class
discussion based on own
interest and understanding
49 4 Dec Presentation and
evaluation
Own works All Presentation and
evaluation
17
Literature:
In addition to the literature mentioned above, notes etc will be available on CampusNet. Participants
are also expected to make any electronically produced slides or PowerPoints available in the folder
carrying the relevant week number
APPENDIX 4. Explanatory notes on participant activities and report
requirements
The course is designed to include in principle three different fields of participant activity:
The group’s work on its own project
The group’s work in relation to presentation and classroom discussion
The group’s work writing theme report/halfway report and exam report
Own project. The group is to draw up a project for the semester’s work as soon as possible. The
group can choose to let their project follow the entire entrepreneurial process as described in the plan
(from idea to invoice). Or it can choose to investigate only parts of this process, e.g. the process up to
and including the identification of opportunities but no further. It is also possible to choose one’s own
firm and use it as a case, working on any elements in need of an in-depth investigation. The group is
expected to have finally formulated its project by the end of September.
Presentation. Each group will present some of the literature appearing from the plan, (if possible) of
their own choice. The group is expected not merely to give a summary of this literature but to relate the
literature in question to their own project. To ask – and answer – questions such as what is of particular
interest in relation to our project? Can we use it for our project; does it raise any questions in relation to
our project? As can be seen, the literature is supposed to help and support work on the
practical/theoretical project. It goes without saying that all the students are to have read the same
literature, to be able to engage in a meaningful discussion of it in class. The presenting group is
expected to prepare questions for discussion, using as a starting point any aspects that they find
difficult to understand, or which they find interesting per se, and in particular in relation to their own
project.
Theme report. At the end of theme 1, the group is to upload one A4 page explaining in key words how
their own project is progressing, relating their project to the theme just completed (please see the folder
THEMEREPORT on CampusNet) no later than Friday in the week the theme ends. In the following
week, there will be a brief follow-up review of the papers submitted.
4 lessons
50 11 Dec Q&A and
discussion
On request On request Q&A / consultation etc.
51 18 Dec
Uploading of
group report
Group report to be uploaded in the
folder GROUPREPORT on
CampusNet
ALL
18
Halfway report. No later than on Friday in week 43, the group is to upload a 5-page report on its
project, outlining its current status and schedule for the work still to be done. This report is to be
presented in week 44 (see the folder HALFWAYREPORT on CampusNet).
Group/exam report. This report constitutes the group’s final exam report. Each student is to write 10-
12 pages, the report amounting to a maximum of 50 pages, including any appendixes. The exam form
has been changed as of 1 September 2007.
The report must include the following items:
a) An outline of the topics the group has chosen to focus on
b) The presentation of the project, including relevant documentation (elaboration)
c) An account of the group’s reflections on the link between their project and the theories covered
in the course. This account may also be included under item b
d) A brief account of the group work process. This may be in an independent section or it can be
an integrated part of item b.
The importance (ie, the weight) attached to the individual parts should be approx: item a 15%, b and c
70%, and d 15%.
Exam form. The nature of this course obviously prohibits the traditional series of lectures cum 4-hour
written exam. The exam instead involves a written group report to act as documentation for the work
carried out, including proof of the group’s reflections on their own work during the process. Great
importance is attached to reflection in this course; the participants must reflect on the choices made
during the process. In order to live up to the requirement that exams must be individualisable, the
uploaded group report forms the basis of the oral exam. Each member of the group is examined
individually in the report. Both the report and the individual oral exam will be included in the evaluation
resulting in the exam grade.
Poul Dreisler
19
APPENDIX 5: e-compendium
Articles and extracts from books
Landström, Hans. (2005).
Chapter 2: The Emergence of An Academic Field.
In: Pioneers in Entrepreneurship and Small Business Research, 1st ed. 2005. Corr. 2nd printing, 2005,
pp. 27-57.
Springer
Abell, Derek F. (1980).
Chapter 1: The problem of defining a business.
In: Defining the business. the starting point of strategic planning, pp. 3-10.
Prentice-Hall
Abell, Derek F. (1980).
Chapter 2: Clues from existing theory.
In: Defining the business. the starting point of strategic planning, pp. 11-25.
Prentice-Hall
Abell, Derek F. (1980).
Chapter 7: A theory of business definition.
In: Defining the business. the starting point of strategic planning, pp. 169-190.
Prentice-Hall
Spinosa, Charles, Flores, Fernando, and Dreyfus, Hubert L. (1997).
Chapter 2: Entrepreneurship: The skill of cultural innovation.
In: Disclosing new worlds. entrepreneurship, democratic action, and the cultivation of solidarity, pp. 34-
68.
MIT Press
Burt, Ronald S. (2000).
Chapter 12: The network Entrepreneur.
In: Swedberg, Richard: Entrepreneurship. the social science view, pp. 281-307.
Oxford University Press
Shane, Scott. (2003).
Chapter 1: Introduction.
In: A general theory of entrepreneurship. the individual-opportunity nexus, pp. 1-11.
Edward Elgar
Ardichvili, Alexander; Cardozo, Richard & Ray, Sourav. (1-1-2003).
A theory of entrepreneurial opportunity identification and development.
In: Journal of Business Venturing, Vol. 18, Iss. 1, pp. 105-123.http://www.baser.dk/login?url=http://www.sciencedirect.com/science/article/B6VDH-46RDDDP-
2/2/70fe5b8fb76667b696c806015d5bde9d
20
Dimov, Dimo. (2007).
From Opportunity Insight to Opportunity Intention: The Importance of Person-Situation Learning Match.
In: Entrepreneurship Theory and Practice, Vol. 31, Iss. 4, pp. 561-583.http://www.baser.dk/login?url=http://www.blackwell-synergy.com/doi/abs/10.1111/j.1540-
6520.2007.00188.x
Forbes, Daniel P.; Borchert, Patricia S.; Zellmer-Bruhn, Mary E. & Sapienza, Harry J. (2006).
Entrepreneurial Team Formation: An Exploration of New Member Addition.
In: Entrepreneurship Theory and Practice, Vol. 30, Iss. 2, pp. 225-248.http://www.baser.dk/login?url=http://www.blackwell-synergy.com/doi/abs/10.1111/j.1540-
6520.2006.00119.x
Cherwitz, Richard A. & Sullivan, Charlotte A. (2002).
Intellectual entrepreneurship: a vision for graduate education.
In: Change, Iss. November/December, pp. 22-27.https://webspace.utexas.edu/cherwitz/www/articles/change.pdf
The article can be found at the page with selected IE Publications
Papers:
Sarasvathy, Saras D. (2001)
What makes entrepreneurs entrepreneurial?
Paper from University of Washington,
School of Business
Pp 1-9.
To be found at this homepage:http://www.effectuation.org/
Sarasvathy, Saras D.; Nicholas Dew; S. Ramakrishna Valamuri & Sankaran Venkataraman (2002)
Three views of entrepreneurial opportunity.
Paper from University of Washington,
School of Business
Pp 1-34
Invited book chapter in the Entrepreneurship Handbook edited by Acs et.al.
(Revised February 1, 2002)
To be found at this homepage:http://www.effectuation.org/ ?Effectuation Research? For a complete
bibliography, organized by year, click here.?2000
8. Support material - Questions and Answers
What is the overall problem(s)/issue in this case?
That it turned into just another educational activity, too similar to other courses. The absence of the
more dynamic environment enjoyed before is sadly felt. Business school students need inter-
disciplinarity, which is no longer present in the course; the students themselves are, however, required
to establish inter-disciplinarity in their project. The individual oral exam is a huge problem.
21
What are the factors affecting the problem(s) related to this case?
Professional disagreement, personal and institutional rivalry etc. In spite of highly motivated and
involved students, the subject area does not enjoy a high status at the universities. Universities reward
research, not educational development. Lack of close contact with the environment. A question of the
teacher’s position on the PLC curve.
Discuss entrepreneurial didactical, pedagogical and organizational issues and resources
related to this case.
Misses the previous concrete cooperation with the many and diverse research-park and innovative
activities in Aarhus. Participants too tied down by time schedules. They work hard, but (after 4 years)
they are still not sufficiently prepared for independent studies. All things considered, the course is
progressing well. Probably too structured, though. Major emphasis is attached to the participants’ own
work.
What role do different players (trainers, policymakers) play in the overall planning,
implementation and management of the entrepreneurship education effort and applications?
The section Background for the case has already dealt with this issue. Politicised agendas have had a
lot of influence. Changing, though, after administrative reform of local government. The jungle of
financial support schemes has led to sub-optimisation. Entrepreneurship is a buzz-word used (and
abused) by lots of players. Everybody wants a piece of the action, with the notable exception of the
universities. The pracademic spirit has not been able to change the ”ivory tower” attitude.
What are the possible alternatives and pros and cons of each alternative facing the organization
in dealing with entrepreneurship practice and the learning goals related to the case?
Many entrepreneurship activities take place ”outside” the university system, but it is obvious that similar
activities could just as easily be established ”within” the system, if there was a wish to do so. To
mentioned a few examples: Stanford, Department for Engineering and University of Seattle have
established internal centres for entrepreneurship, functioning along much the same lines as those
found in Denmark outside the system, and struggling to survive.
What are some of the alternative approaches that could be considered in achieving the learning
goals related to the case?
Time and incentives should be given to teachers who build up learning networks as the basis for their
teaching. The students should take over and take part in the network as their study and work field. This
happens in various shapes at some of the newer universities, but not everywhere. The advantage is
that knowledge and competences are spread to many more than the students themselves.
What recommendations can be made to the educational staff, policy makers or management of
the organization described in the case? Provide your arguments in support of the
recommended solution.
The universities must make up their minds whether they wish to stick to the ivory tower spirit or to
realise an entrepreneurial university vision. If they chose the latter, they must develop learning
programmes in which knowledge and application of knowledge are given equal weight (mutual
knowledge and competence creation). Establish networks including business and ”outside” actors.
Make inter-disciplinarity a requirement and organise according to a contingency principle. That is, in
each specific situation consider and choose the most sensible line of action.
22
9. Epilogue and lessons learned
This has been written as a response to the evaluation of outputs and outcomes at the completion of the
BEPART project on 2-3 October 2007 in Rostock. But what I have written is also based on my
experiences over 20 years in the subject field. Apart from BEPART, I have been involved in a number
of projects on entrepreneurship:
• Together with two colleagues, I have written extensively on a theme we have called
“Entrepreneurship Education – the New Challenge Facing the Universities. A framework for
understanding and development of entrepreneurial university communities”
• I have served as a member of a working group on ”How to implement entrepreneurship in the
Danish educational system – from kindergarten to PhD”.
• I have been involved in projects to include entrepreneurship in the Danish folk high school
movement
• I am one of the founders of Centre for Entrepreneurship and served as a co-leader for almost
three years
• I was involved in the foundation of IDEA (International Danish Entrepreneurship Academy)
• I have been responsible for the teaching of subjects related to all aspects of innovation and
entrepreneurship from 1989 to 2007
• plus a host of other activities.
If we look at this particular subject area from a general, overall perspective, it is characterised by a
number of special circumstances not found when developing courses etc in connection with other
subject areas. Some of the special circumstances surrounding entrepreneurship are:
• The development of entrepreneurship constitutes a battlefield, involving politicians, institutions,
teachers, administrators and many others
• Public grants for the area are often seen as short-term investment, expected to yield high
returns within a very short timeframe
• The subject area has yet to find its place at universities, a place where it can develop
organically and in accordance with its own logic
• Public funds are usually given to institutions outside the university sector or to special centres
or initiatives attached to universities
• Concepts like entrepreneurship, creativity and innovation have acquired a status as catch-all
mantras in the school system (primary and secondary)
• University teachers are not rewarded for working with the subject area or given enough scope
and funds to experiment. Instead external ”consultants” are typically brought in
• When discussing experiences of including the subject area in their educations, many teachers
use the word ”resistance” (I heard the word used repeatedly at the conference in Cambridge in
summer 2007)
• - just to mention a few of these special circumstances.
The lessons to be learned from this (and indeed the lessons learned through the project BEPART) is
that we have to be more specific when we use the concept entrepreneurship and define it in terms of
the time, place and level at which we wish to implement it. We need to bear in mind that the concept is
23
used in so many different interpretations and definitions that we should avoid using it as a course name
in our educations.
As part of our educational systems, the concept Entrepreneurship has become its own worst enemy.
Educations within this subject area are usually turned down by the system, and therefore organised
outside it.
We need to define the concept as a process for students in all subjects at our universities, meaning
that ”the entrepreneurial university” should become the specific goal in the sense that the university
offers educations in ”enterprising / entrepreneurial behaviour”, teaching students to create value for
society by using their knowledge and competences alone or, in most cases, in combination with other
competences.
Entrepreneurship and similar subjects should not be taught to a few highly motivated classes or groups
of students; it needs to be implemented as a study form in subjects like technology, sciences and
humanities, and in all other subject areas.
And we should never ask children in primary and secondary school to sit still and listen to lectures on
entrepreneurship, creativity and innovation. We must encourage and not spoil their inborn talent for
these behavioural elements. That is why it is a big mistake that the subject field has now been taken up
at teachers’ training colleges, demanding these concepts to be added to the curriculum.
At universities, we have to look at entrepreneurship as processes and new pedagogical forms, trying to
combine academic theory and practice in such a way that new knowledge is created where the spheres
meet, and knowledge becomes the basis for the creation of value, for both the student and society.
There is a concept called an ”intellectual entrepreneur”. This refers to a student who, just like a
scientist, is always prepared to take a risk, constantly looking for opportunities to work together with his
or her surroundings, outside the classroom. This is the philosophy behind a master programme at
Texas University in Austin, USA.
”The philosophy and practise of intellectual entrepreneurship serve as a catalyst, allowing students to
identify opportunities to put their training and expertise to use in creative and innovative ways, whether
in business or scholarship.” (Cherwitz, R.A. & Sullivan, C.A. 2oo2). And to add a couple of other
quotes:
“…to succeed in entrepreneurial capitalism, everyone must learn to be entrepreneurial in any setting”
(Carl Schramm, President of the Kauffman Foundation), and
”More and more it is clear that entrepreneurship is a style and general method of operating and not just
a set of business skills.”
(The Colemann Foundation).
24
A Case of Teaching Business Planning
at Tallinn School of Economics and Business Administration
Tallinn University of Technology
1. Learning Goals
The students:
- realise the importance of preparing a business plan to minimise risks involved in
starting a new business;
- gain an overview of the Business Plan structure and preparation process;
- get accepted definitions of various Business Plan terms;
- get some practice for writing a Business Plan on the basis of their own business idea.
2. Executive summary
This chapter is demonstrating a case of teaching Business Planning at Tallinn University of
Technology for students of technical specialities.
The aim of the course is to develop the basic knowledge and skills on entrepreneurship,
particularly on business planning process starting from business idea generation, finding and
evaluating business opportunities up to calculating financial reports of the business. The main
principles, rules, processes and methodological approaches on the level of enterprise are to be
explained. A business plan will be completed at the end of the semester on the basis of
students’ own business ideas.
The teacher’s main tasks are:
- to provide theoretical knowledge on entrepreneurship, business planning and business
administration;
- to instruct the students to find and test business ideas, and assess the business
opportunities;
- to consult group work and writing business plans;
25
3. Background
Programmes of most of the technical specialities at Tallinn University of Technology include
economic subjects such as macro- and micro economics and business administration or
business planning. The subject of business administration also contains business planning as
the main part. The programmes of both subjects envisage that students prepare a business
plan as an independent work task. These subjects are obligatory for the mentioned target
groups. Every year over 200 students take this course.
The classroom lessons are conducted in rooms equipped with a media projector and other
needful facilities.
Two teachers are involved. While one teacher is responsible for raising the students’
awareness and providing knowledge on theoretical side of entrepreneurship, business planning
and business administration via lectures and discussions on relevant subjects, the other
teacher is responsible for consulting students on business planning and writing business plans
as well as their independent homework in the same issues.
4. Case description
The volume of the subject is 2.5 credit points and 48 hours of classroom lessons including 32
hours of lectures. One third of the total volume of the subject is independent work. The purpose
of the large number of students and relatively small number of classroom lessons is to seek
teaching methods that would provide the students with a comprehensive overview of
entrepreneurship and business administration and an opportunity to acquire knowledge on
what one must need to know of planning one’s own business and how to write a business plan.
Theoretical lectures and principal discussions take place in large rounds (app. 70-150
students), but practical work of preparing business plans is conducted in practical classes in
smaller rooms (app. 10-20 students). Development of a business idea and writing of a business
plan carried out as a group work (app. 2-4 students).
The target group is primarily master’s students in technical specialities, e.g. mechanics,
chemistry, information technology, mathematics and natural sciences, power engineering,
logistics etc. Depending on the economic subjects in the curricula of these specialities, two
different level groups can be distinguished. On the basis of this, logistics students have this
subject already on the bachelor level with focus on business planning, taking into consideration
their previous knowledge about marketing, management, accounting etc. fields of economics.
Knowledge of students of other specialities about economic subjects are limited only to micro
and macroeconomics. They learn in greater detail the terms of entrepreneurship and business
administration and in parallel are introduced to the business planning process.
In classroom lessons all theoretical issues are explained and the use of active teaching
methods and the involvement of students in the classroom work is largely limited due to the
large audience. Hence, students listen to a lot of theoretical material in lectures, which is
supplemented with many cases and examples and which can be discussed in a large
audience. Classroom lessons also discuss methodical methods that can be used in practical
independent work outside the classroom (e.g. market research, collection of information on
competitors, raw material and financial sources, etc.). In practical lessons discussions are held
26
in smaller groups in different business planning subjects and teachers consult development of
business ideas found by the students and writing of business plans.
Additionally, the subject is provided with the e-learning environment (Moodle) where the
students find the lecture materials, as well as instructions for practical work and tasks. The
teachers and students can communicate, ask questions and have a discussion in the forum.
Contents of the subject Enterprise Economics. Business Planning
The content of the course:
I Lectures
1. week. Introduction to the course. Business idea generation. Overview of the process
and structure of business planning.
2. week. Recognition and evaluation of business opportunities. Entrepreneurship,
entrepreneur, enterprise. The psychological portrait of the entrepreneur.
3. week. The mission, vision and aims of enterprise, business definition. Internal and
external environment of enterprise.
4. week. Main principles of marketing. Market research.
5. week. Product and price policy. Planning marketing policy.
6. week. Strategic analysis and development. Sales strategy and methods.
7. week. Business organisation and its legal forms. Non-profit organisations.
8. week. Establishment of a new enterprise, independent study on the basis of website
www.aktiva.ee .
9.-10. week. Accounting and recording. The structure of expenditures and accounting
methods. Calculating net costs. Profit statement. Cash flow prognosis. Balance.
11. week. Cost-benefit analysis
12.-13. week. Financial management and analysis. Time value of money. Investment
budgeting.
14. week. Entrepreneurship policy and business support system.
15. week. Entrepreneurship policy in Europe and measures for promoting SMEs.
16. week. Entrepreneur as a guest lecturer. Experience and suggestion on business start-
up and business development issues.
Practical lessons, workshops
All theoretical knowledge on business planning and enterprise’s economic activity, as well as
methods for preparing a business plan and calculations are presented in lectures. In practical
lessons results of independent work are discussed and consultations conducted.
1. Consultation via e-mail or forums in issues of independent work: searching for and
choice of a business idea, market research, analysis of factors that influence demand,
collecting information on competitors in the first practical classroom lesson.
Independent work according to instructions and lecture materials in the e-study
environment: conceiving and testing a business idea; evaluation of factors that
influence demand; comparative table of competitors.
2. Discussion of the results of independent work in the development and implementation
of a business idea: presentation of a business idea in groups, factors that influence
demand, overview and comparative analysis of competitors; questions and answers.
3. Classroom consultation in general part of business plan related issues/problems;
4. Defence of the general part of business plan with product/service pricing
5. Consultation via e-mail in business plan related issues/problems.
6. Classroom consultation in business plan related issues/problems.
27
7. Seminar: analysis of cases/problems encountered in enterprises and finding solutions
to them
8. Defending of business plans.
Examination of knowledge: The course will end with a written examination. A precondition of
admitting to examination is a timely submitted and positively defended business plan. The
examination result is to the extent of 50% determined by the written examination and to the
extent of 50% participation in classroom work and business plan mark. During a session all
those who satisfy the preconditions are admitted to examination.
Current challenges/problems facing the organisation/project experience or educational
effort
The biggest problem is that at a time the subject must be taken by a large number of students
as an obligatory subject, which sets limits to using different active forms of teaching. Still, a
quite suitable form for teaching large groups has been found in this case: the theoretical part in
the form of lectures in a large group and practical lessons in smaller groups are synchronously
combined and take place under the guidance of two teachers in parallel. The support of e-study
helps a lot; it is a supplementary source of information for the students and a means of
communication between themselves and with teachers. Learning of the subject is also
facilitated by the website provided by the entrepreneurship support system, which contains
examples and cases of lessons of from the life of enterprises in the business environment, and
recommendations to other entrepreneurs.
5. Further reading
Hougaard, S. (2005). The Business Idea. The Early Stages of Entrepreneurship. Springer
Immink, R., O’Kane, B., Owens, T. (2002). Starting Your Own Business. A Workbook. Oak
Tree Press.
Shane, S. 2003. A General Theory of Entrepreneurship. The Individual-Opportunity Nexus.
Series: New Horizons in Entrepreneurship, University of Virginia, Edward Elgar.
Timmons, J.A. 1999. New Venture Creation. Entrepreneurship for the 21st Century. Irwin
McGraw-Hill, USA;
Kallam, H., Kolbre, E., Lend, E., Möller, L., Reinhold, V., Simson, A., Uustalu, A., Venesaar, U.
(2003) Ärikorralduse põhiteadmised.
Külim, Tallinn;
Ettevõtja infovärav – www.aktiva.ee
Ettevõtja käsiraamat (Äripäeva käsiraamat).
28
6. Support material
Since cases accepted for publication are considered to be teaching and educational cases, we
expect many academicians to utilize these studies in their information system courses. In
consideration of this, we ask that in addition to your completed case study, you also provide
three teaching aids:
1. A list of questions and answers for your case
2. An epilogue and a list of lessons learned; and
3. A list of resources for further study.
Ad (1). Questions and Answers
Please prepare a list of 5-7 questions relevant to the issues, problems and challenges
discussed in your case. Then provide a concise paragraph of 30-50 words in answer to each
question. Feel free to create your own questions or use and adapt the sample questions listed
below.
• What is the overall problem(s) issue in this case?
• What are the factors affecting the problem(s) related to this case?
• Discuss entrepreneurial, didactical, pedagogical and organizational issues and
resources related to this case.
• What role do different players (trainers, policymakers) play in the overall planning,
implementation and management of the entrepreneurship education effort and
applications?
• What are the possible alternatives and pros and cons of each alternative facing the
organization in dealing with entrepreneurship practice and the learning goals related to
the case?
• What are some of alternative approaches that could be considered in achieving the
learning goals related to the case?
• What recommendations can be made to the educational staff, policy makers or
management of the organization described in the case? Provide your arguments in
support of the recommended solution.
Ad (2). Epilogue and Lessons Learned
Please provide an epilogue paragraph in which you discuss the long-range effects of your
case. Do not include an epilogue in your actual case study. Next, provide a list of 3-5 lessons,
along with a concise explanation of each, that in your opinion can be learned from your study.
Ad (3). List of Additional Sources
Please prepare a list of other resources (e.g., journal articles, books, Web sites) that might be
relevant for obtaining additional information either directly related to or similar to your case.
List any industries where the described case may be pertinent.
29
Master Program in
Entrepreneurship and Technology Management:
Evaluation of the Successful Initiative in Estonia
Janita Andrijevskaja
University of Tartu
Faculty of Economics and Business Administration
1. Introduction
Wide range of universities and colleges has been recently investing in developing programs in
entrepreneurship and technology management. Striving for entrepreneurial knowledge
economies and supported by strong political support, many institutions have successfully
introduced either technology management or entrepreneurship curricular. However, there are
rather few examples of successful integration of both subjects.
University of Tartu (Estonia) has been the first university in the Baltic States to integrate
entrepreneurship and technology management in a master program curricular. The program’s
objective is to provide modern and applicable knowledge in entrepreneurship, innovation and
technology management. Oriented on that, the master program’s long-term mission is to
support Estonian companies in their becoming more innovative and technology oriented.
Started in 2002, the program has yet a short operating experience and might have some
challenges to overcome, nevertheless it is clear - this initiative does have a strong demand in
Estonia. The objective of the present article is not only to describe the program, but also
evaluate the extent to which the Master Program succeeds in providing modern and applicable
knowledge in entrepreneurship, innovation and technology for the managers of small high-tech
companies. The reason for focusing on small high-tech companies is that managers of these
companies are considered one of the main target groups for the program.
The content of this article can be useful for the institutions that are planning to launch
interdisciplinary programs on entrepreneurship and technology management (ETM) as well as
for institutions that look for good ideas to improve their program.
30
2. Methodology of the evaluation
To achieve the surveys’ objective, and evaluate ETM master program’s contribution to
strengthening small high-tech companies, the author follows the stages, presented in figure 1.
Firstly, educational “supply side” is presented: the author describes ETM master program at the
University of Tartu and briefly refers to the experiences with entrepreneurship programs in
other countries. Then “the demand side” is analyzed: the needs of potential students (i.e. small
high-tech companies) are under discussion.
Figure 1. Structure of the study
Conducting empirical survey, several primary and secondary information sources were used:
interviews with student and programs coordinators, questionnaires and documents on ETM.
Two types of questionnaires were analyzed in this study: survey of students’ general
satisfaction, and alumni questionnaire. The questionnaire of satisfaction encompasses opinions
of majority of students, whereas alumni-oriented questioning was conducted with only 3
students. These students (managers of high-tech companies) are among the first to graduate
from the discussed program. The results and conclusions of the study are presented in the final
part of the report.
3. ETM master program: overview and potential challenges
The master program in Entrepreneurship and Technology Management at the University of
Tartu was first opened for enrollment in 2002. The initial objective of the program coincides with
its present objective - it was to integrate studies in entrepreneurship and technology
management and raise “…entrepreneurial culture in the academic community” (Final…2001).
Launching ETM curricular was a pioneering initiative in Baltic States: up to present, there is no
other institutions neither in Estonia nor in other Baltic States that run similar program.
The program was developed by international team of four people: prof. Tamkivi and prof.
Karelson from Estonia (Tallinn University of Technology), prof. Formica and Lex de Lange from
the Netherlands (Zernike Group). All of them belonged to the International Association of
Science Parks – the organization through which mentioned above people got acquainted. The
advantage of the initiative group was a good knowledge of technology management (Tallinn
University of Technology) and extensive entrepreneurial experience (Zernike Group). Both
knowledge and experience was helpful in applying for PHARE funds to develop the curricular in
details.
Overview of ETM
program
Chapter 3
Needs of ETM
students, satisfaction
Chapter 4
Final results,
conclusions
Chapter 5
1. ETM master
program at the
University of Tartu
2. Potential challenges
Sources of information: 1. Interviews with ETM students.
2. Questionnaires. 3. Reports and other documents. 4 Articles
Small high-tech companies
in Estonia and abroad:
educational needs
Evaluation of the
program’s match
against students’
needs:
1. Courses
2. Thesis writing
Recommendations
31
The general data on the ETM master program presented in table 1 was planned back in 2001
and is also valid nowadays. After introduction of the curricular, a 4-member council for ETM
program development was formed, consisting of two professors and two students’
representatives. The council was to initiate changes in the program. The structure of courses
(presented in Appendix) has changed insignificantly over the last 3 years, that can be a sign of
a good planning: prior the introduction of ETM program, numerous interviews were conducted
with potential ETM students to identify educational needs of the target group.
Table 1. General data on the EMT master program at the University of Tartu
Criteria Description
Nominal study time 2 years
Volume of the program 80 credit points (CP) or 120 CP according to ECTS
Entrance criteria Bachelor degree in natural sciences, engineering, economics or social
sciences
Structure of the program 56 CP for ETM obligatory and non-obligatory courses
20 CP – Master Thesis
4 CP – courses under other faculties
Groups of ETM courses 1. Entrepreneurial environment
2. Technology policy and management
3. Legal issues
4. Human resource and communication
5. Marketing and sales management
6. Financial planning and control
Study time schedules Classes once a month, over long weekends: Thursday through Sunday
Number of enrolled
students
2002 – 25 students; 2003 – 30 students, 2004 – 35 students
As planned, the ETM master program gained international and interdisciplinary character from
the very first days of its establishments. Not only teachers from Estonian universities taught
ETM, but also experts from Zernike Group (The Netherlands), International University of
Entrepreneurship (The Netherlands), and Michigan Technological University (USA).
The target group of the Master program is specialists who have received Bachelor degree in
the fields of natural sciences, engineering, economics or social sciences. When selecting
applicants the priority is given to students with educational background from natural sciences
and engineering; another priority’s criteria is managerial experience and strong motivation for
entrepreneurial activities of a student.
Being launched in 2002, the master program’s nominal study time was 2 years, thus in the year
2004 the first four students have graduated from the faculty. By July 2005, six more students
are expected to obtain ETM Master Diploma. Also in the 2005 the program will go through the
accreditation process at the Estonian Ministry of Education.
In the following part of the chapter the problems of entrepreneurial education are briefly
discussed based on the experience reported from countries with advanced economies. It might
be expected that Estonia, having only 15 years of democratic, market-driven economy can face
the same problems while developing programs for entrepreneurial education.
32
According to the European Commission’s report (Final…2001) the major problems related to
entrepreneurial education are the following:
1. Entrepreneurship programs are not supported on political level, and are weakly
integrated into educational system.
2. The evaluation system of entrepreneurship education is inadequate.
3. At universities, entrepreneurship is mostly taught to business students.
4. Teachers are not sufficiently trained to become entrepreneur.
5. Weak relations among universities and business sector diminish effectiveness of
teaching entrepreneurship.
The presented long list of problems indicates, that not only it might be difficult to launch the
problem (lack of experience, lack of political and financial support), but it also challenging to
insure good quality of courses, their correspondence to the needs of entrepreneurs.
Indeed, even the United Kingdom, country known for pro-business environment, high-quality
MBA and entrepreneurship programs, is criticized for inefficient entrepreneurship teaching
methods. Numerous UK entrepreneurship programs lack structure and clear objectives,
institutions prefer investing in advertising innovative programs rather that raising quality of
curricular. In many institutions the established academic traditions are a serious obstacle for
entrepreneurial programs to be launched, thus new initiatives face tremendous resistance.
(Tiratsoo 2004)
Problems of entrepreneurship and technology management education are discussed by Weller
(1999), who mentions that lecturers often choose specialist approach, not integrating particular
course with other courses, or not integrating theory with business or other type of environment.
Launched in 2002 in Tartu, the ETM master program enjoys growth of enrolled number of
students and favorable public image. Nevertheless, considering the experience of other
countries it might be expected that there are serious challenges facing this pioneering
curricular.
Educational needs of small high-tech companies
After a long period of planned economy, Estonia gained independence in 1991, having faced
the need for restructuring of partly collapsed industries and raising competitiveness of newly
established businesses. Even though the government is trying to improve business
environment in Estonia, there are yet numerous problems that hold ratio of start-ups and
innovative companies at the level below EU average.
What educational needs do small high-tech companies have? Due to the fact, that this question
is not sufficiently studied in Estonia, the experience of other countries is presented here. For
example, survey of Chiesa and Piccaluga (2000) showed that among the most critical issues
for small high-tech companies were finding financing sources, applying right marketing
approach and commercializing the technology (see table 2).
33
Table 2. Major problems of small high-tech companies
Problem
Average rating
(1-unimportant, 5 – critical importance)
Financing 3,58
Marketing, selling,
commercialization
3,10
Evaluation of market’s needs 2,73
Distribution, logistics 2,57
Technical problems in production
and development of product
2,42
Problems with contracts 1,83
Managing human resource 1,78
Problems with business owner 1,62
IPR 1,54
Source: Chiesa, Piccaluga 2000
For many Estonian technology-based companies, local market is too small to operate without
losses, thus it would be necessary for ETM educational programs to include courses on
internationalization. Another important aspect discussed in literature on high-tech small
businesses is a question of employees’ motivation (Nurmi 1998). The biggest value in
innovative companies is often not just technologies, but people, who develop and
commercialize technologies. Retaining and motivating these people can be challenging for
manager, who has no managerial education. Summarizing the discussion above, manager of a
small high-tech company is likely to have interest in the following educational fields: marketing,
sales, internationalization, human resource management. Additionally it is also important to
learn how to manage technology efficiently. These four fields with several keywords have been
presented to several ETM students. The results of discussion - major educational needs
perceived by several ETM students - are presented in the table 3.
Table 3. Educational needs of small high-tech companies’ managers
Field
Educational needs
Practical marketing skills for small high-tech company
Mapping potential market
Cooperation with client, communicational psychology
Marketing in a narrow technological field
Marketing and
sales
Sales and organization of distribution network
Evaluation of commercial potential and viability of a business idea
Creation of a network (finance, marketing, technology etc.)
Patents, IPR
Product
development
Product development, technology transfer
Contracts and international business acts
Getting started in a narrow, but global technology fiel.
Searching and choosing strategic partners
Internationali-zation
Advertising, purchasing decisions etc in various countries
Motivating employees to think in business terms
Teamwork
Teamwork
management
Organizational culture (acknowledgements etc)
Source: Based on interviews with ETM students
34
When asked about writing a Master Thesis at the university, ETM students expressed uniform
opinion the subject for the Thesis need to be closely connected to practical issues, for example,
case-solving approach or writing a business plan. Students did appreciate the time spent
consulting with supervisor and other involved people on problems connected to the thesis.
Thus not only content of curricular is important for students, but also informal communication
with lecturers, professors and motivating and pragmatic requirements for writing a Master
Thesis.
Results and conclusions
The objective of the present article was to present ETM master program introduced at the
University of Tartu and to analyze, to which extent the program corresponds to the needs of
managers of small high-tech companies. The description of the ETM was given in chapter 1,
whereas the program’s match against students needs is to be discussed in the present section.
It is also presented here, what are the major strengths and weaknesses of the program and
what are the opportunities for further development.
ETM master program consists of 26 courses, grouped in 6 modules (see Appendix 1). After the
needs of several managers of small high-tech companies have been identified in the previous
chapter, it is now possible to clarify, to which extent the required education is reflected in the
ETM master curricular (see table 4).
Table 4. Match between educational needs of students and available ETM courses
Field
Educational needs Available ETM courses
Practical marketing skills for small high-tech company Marketing
Mapping potential market Marketing
Cooperation with client, communicational psychology Sales and distribution management
Marketing in a narrow technological field -
M
a
r
k
e
t
i
n
g
a
n
d
s
a
l
e
s
Sales and organization of distribution network Sales and distribution management
Evaluation of commercial potential and viability of a
business idea
Application of technology strategy methods in
business
Creation of a network (finance, marketing, technology etc.) -
Patents, IPR
Intellectual property rights: licensing, protection
of trademarks and products
P
r
o
d
u
c
t
d
e
v
e
l
o
p
m
e
n
t
Product development, technology transfer
Technology transfer; Quality management;
Nanotechnologies etc
Contracts and international business acts Contract and business negotiations
Getting started in a narrow, but global technology field. -
Searching and choosing strategic partners -
I
n
t
e
r
n
a
t
i
o
n
a
l
i
z
a
t
i
o
n
Advertising, purchasing decisions etc in various countries Sales and distribution management; Marketing
Motivating employees to think in business terms Leadership and personnel development
Teamwork -
T
e
a
m
-
w
o
r
k
Organizational culture (acknowledgements etc) Organizational culture
Source: Based on table 3 and ETM master curricular
35
Analyzing the match between students’ educational needs and available ETM courses, it
appears that most of the required fields are covered by the Master Program. The interviews
with students enabled collecting some additional information. Students with non-economic
background appreciated the fact that they could enroll into the program that combines
business, entrepreneurship and technological matters. It is also highly valued that most of the
ETM teachers are professionals in their fields and some of them have also extensive practical
experience.
Dissatisfaction caused the fact that several technology-oriented subjects are poorly connected
to business and entrepreneurship, being more like scientific courses instead. There was also
comment that some of the teachers (mostly local) are reluctant to make courses interactive,
and courses’ information to be more applicable in business. This might be caused by: a)
teachers lack of appropriate training in modern teaching methods, b) traditionally academic
career of several local teachers.
Table 5. Conclusions of the study
Strengths
Weaknesses
Interdisciplinary: technology, business,
entrepreneurship
Local teachers lack ability/motivation to
connect theory with business reality
International network of top-specialists Local teachers use few methods to make
the course interactive
Uniqueness in Baltic States Traditionally academic requirements to
Master Thesis
Sustainable structure of courses Lack of several essential courses
Suggestions
Organize training seminars for current and potential ETM teachers
Add several courses: on psychology, launching new product etc.
Invite practitioners (including ETM alumni) for short-term lecturing
Rethink requirements for the ETM Master Thesis
Strengthen international network and links to practitioners with academic background
Source: compiled by the author
The ETM master program has been developed based on the need of Estonian businesses, and
demand for ETM education is clearly increasing. Even though there are quite a few challenges
ETM program faces, the council of ETM program development works on improving the program
by attracting new partners and raising requirements for ETM teachers. After the accreditation of
the program the discussions will start to prepare English version of the program for
international students.
36
References
1. Chiesa, V., Piccaluga, A. Exploitation and diffusion of public research: the case of
academic spin-off companies in Italy. – R&D Management, 2000, Vol 30, No. 4, pp. 329-339.
2. Ettevõtlus ja tehnoloogia juhtimine: õppekava.Tartu Ülikool. Majandusteaduskond. 2004
3. Final Report of the Expert Group “Best Procedure” project on Education and Training for
Entrepreneurship. November 2002. 58 p. [europa.eu.int/comm/enterprise/entrepreneurship/
support_measures/training_education/education_final.pdf]
4. Final Report on Development of Mater Programme in Entrepreneurship and Technology
Management. 2001
5. Interviewed persons: Dorel Tamm, Tõnis Mets, 3 ETM students.
6. Tiratsoo, N. The “Americanization” of Management Education in Britain. – Journal of
Management Inquiry, Vol. 13, No 2, June 2004, pp.118-126.
7. Weller, M., Dillon, P. Education and Business Partnerships in the United Kingdom: Initiatives
in Search of a Rationale.-Bulletin of Science, Technology and Society, Vol. 19, No1,
February 1999, pp. 60-67.
37
8. Appendix 1
Master Programme in Entrepreneurship and Technology
Management
Credit
Points (CP)
Primary Lecturers/ Tutors *
TOTAL
80 CP
1. Module. Entrepreneurial environment 10 CP
1.1. Entrepreneurship and Innovation, Intrapreneurship 4 CP Prof. P. Formica (IUE)
1.2. Business Strategies. Business Planning, Product and
Service Planning and Development
4 CP M.Sc. E. Vazquez Mu?oz
(IUE)
1.3. Entrepreneurship 2 CP T. Mets (UT)
1.4. Research methodology 2 CP E.Reiljan, U.Varblane (UT)
2. Module: Technology policy and
management
20 CP
2.1. Modern Key Tehcnologies 2 CP M. Karelson (UT)
2.2. Technology and Innovation Polices 2 CP K.Männik, K.Kubo (UT,
Ministry of Economic
Affairs)
2.3. Total Quality Management 2 CP T.Tammaru (TTU)
2.4. Technology Transfer, Technological Expertise 2 CP M. Karelson, (UT)
2.5. Application of Technology Strategy Methods in
Business
2 CP E. Valmra (EAS),
T. Hein (HeiVäl)
2.6. Technologies in the fields of specialisation (electives) Students to
select 10 CP
Modern materials and materials technologies 2 CP J.Kikas (UT)
Nanotechnologies 2 CP R. Jaaniso (UT)
E-commerce 2 CP K. Kerem (TTU), A. Pärl
Software development 2 CP
Information technology policies 2 CP J. Villemson (UT), U. Puus
(Cybernetica)
Business Information System 2 CP V. Leping (UT)
T. Saarsen (UT)
Logistics Management 2 CP R. Jüriado (UT)
Transgenic Technology 2 CP A. Mäe (UT)
Environmental Technology 2 CP Ü. Mander (UT)
T. Tenno (UT)
J. Truu (UT)
Management of Knowledge and Innovation Processes 2 CP T. Mets (UT)
38
3. Module: Marketing and sales management 9 CP
3.1. Marketing (including brand marketing) 3 CP M.Miljan (UT)
A. Brokaw (MTU)
3.2. Sales and distribution management 3 CP D. Dijk (IUE)
3.3. Internationalisation of business 3 CP P. Formica (IUE)
U.Varblane (UT)
T.Roolaht (UT)
4. Module: Financial planning and control 6 CP
4.1. Entrepreneurial Finance 4 CP A.Juhkam (UT)
P.Sander (UT)
T.Haldma (UT)
4.2. Fundraising Process: Grants / Subsidies to Private
Funding, seed Capital for Start-ups
2 CP L. De Lange (IUE), A.
Juhkam (UT)
5. Module: Legal Issues 4 CP
5.1. Intellectual property rights framework, including the
licensing, protection of trademarks and products
2 CP L.A. Stienstra (IUE)
5.2. Project Management 2 CP T.Mets, K. Kaarna (UT)
6. Module: Human recourses and
communication
7 CP
6.1. Leadership and personnel development 2 CP K.Türk (UT)
6.2. Organisation and Organisational Culture 3 CP M.Vadi (UT)
Free courses 4 CP
Master Thesis 20 CP
* used abbreviations: IUE – International University of Entrepreneurship, Netherlands, UT –
University of Tartu, TTU – Tallinn Technical University, MTU – Michigan Technological University
39
Competence-based Entrepreneurship Model
Entrepreneurship Incubators at HAMK University of Applied Sciences
Seija Pajari-Stylman Heikki Hannula
Project Manager Senior Lecturer
P.O.Box 190, 13101 HÄMEENLINNA P.O.Box 182, 13101 HÄMEENLINNA
tel. +358 (0)3 646 3671 tel. +358 (0)3 646 3377
fax +358 (0)3 646 3700 fax +358 (0)3 646 3200
[email protected] [email protected]
Keywords:
Learning, entrepreneurship, competence, incubator
Abstract
Pre- and start-up incubators are used as authentic and simulative learning environments at HAMK
University of Applied Sciences. They can offer the students excellent opportunities to learn
entrepreneurial competences in simulative or even authentic situations. These provide the students with
good learning experiences. For high-quality learning these experiences are necessary but not enough.
The experiences will be reflected on in the action learning sessions.
In this article we first describe the basic assumptions about our thinking of the learning of
entrepreneurial competences. Then we give an example of our learning methods. After that we will
describe learning in pre- and start-up incubators at HAMK University of Applied Sciences as an
example.
40
1. Introduction
HAMK University of Applied Sciences offers high-quality education, research and development services,
and an international atmosphere. Situated centrally in the prime area of southern Finland, HAMK has
units in seven locations with 25 degree programmes and 7000 students. Our main aim is to develop
extensive competence that can be utilised by businesses, industry and the public sector in the region as
well as globally. HAMK’s centres of expertise, developed in cooperation with companies and
municipalities, support our degree programmes as well as research and further education. Our fields of
education are Culture, Natural Resources and the Environment, Natural Sciences, Social Sciences,
Business and Administration, Social Services, Health and Sports, Technology, Communication and
Transport, Tourism, Catering and Domestic Services as well as Vocational Teacher Education. All
degree programmes at HAMK are delivered in Finnish with the exception of the Construction
Engineering programme in Hämeenlinna, the International Business programme in Valkeakoski, and the
Mechanical Engineering and Production Technology programme in Riihimäki, which all are delivered in
English. (HAMK University of Applied Sciences)
HAMK University of Applied Sciences launched pre-incubator activities in seven of its units as from 1
st
January 2004. Pre-incubators a.k.a. start-up incubators are located in the Visamäki unit in Hämeenlinna
and in the Forssa, Lepaa, Mustiala, Riihimäki, Valkeakoski and Evo units.
The objective of pre-incubator activities is to learn about entrepreneurship and to learn by actually being
involved in business. The activities are divided in three stages:
- learning to understand entrepreneurship,
- learning by actually being involved in business,
- learning to do business. (Saurio 2003, 117).
2. Background
2.1. Learning entrepreneurial competences
Before we can describe our incubator model, we should define how we understand some key concepts.
It is very important to understand how we believe the people can learn. The first important concept is
learning. We have to think about entrepreneurship, as well. How do we understand the dimensions of
entrepreneurship? Further, we have to understand the concept of competence.
Thus, there are three basic concepts to define. Before the conclusions we would like to specify how we
understand each of them.
2.2. Learning
Learning not teaching is the basic process in entrepreneurial studies at HAMK University of Applied
Sciences. We apply a constructivist view on learning. The main task of a teacher is to support the
learning of his/her students or other learners. Instead of distributors of information, knowledge or skills,
the teachers are more tutors, mentors or counselors who try to ensure that the students get good and
motivating learning experiences and that they reflect on these in interactions and in collaboration with
their tutors and peers. In vocational and professional learning the learning experiences should be as
authentic as possible. That is why we believe in the constructive ways of learning modelled by for
example in Learning by Doing, Project Learning, Action Learning, Problem-Based Learning,
Entrepreneurial Learning etc. Even if we believe in applying several learning models, in this article we
use action learning as an example.
41
There are not only one or two ways of learning. Every learner is a unique person and he/she learns in a
personal way. And that is why we think that learning and teaching should be as personalized as
possible. The basis of a learning process is the mental constructions of a learner. We try to help and
support our learners to find out the best ways of changing and developing their mental construction to
enable vocational and professional growth.
How to support the learning process? The effective methods of supporting learning should be very
many-sided. That means that we should find out several, not only one didactical and pedagogical way to
support the learning process effectively. There are several ways of learning both formally, informally and
non-formally. Reading, doing, observing, group working etc. are examples how to experience learning.
Also the awareness of the meanings and targets is important. The learners should know why to work
and what to do to reach the set objectives. For example at the end of the studies or after the studies, the
incubation of the ideas is a very efficient learning method However, but before that many other methods
should have been used.
2.3. Entrepreneurship
Entrepreneurship is a wide concept. It means not only entrepreneurship as an entrepreneur. It means
individual entrepreneurship, organizational entrepreneurship and intrapreneurship, as well. Paula Kyrö
and Camille Carrier (2005, 22) define these four issues in the following way:
1. The oldest form of individual, self-oriented entrepreneurship, meaning an individual’s self-
oriented behavior (individual entrepreneurship),
2. The creation, management and ownership of a small enterprise, referring to the individual
entrepreneur and his enterprise (entrepreneurship),
3. Corporate or organizational entrepreneurship referring to an organization’s collective behaviour
(organizational entrepreneurship), and finally
4. Intrapreneurship referring to the interplay between individual and organizational
entrepreneurship.
It means that entrepreneurship appears both in finding out and rolling your own business, working for
another or for example in voluntary hobbies. It can be called entrepreneurial behavior (Gibb 2005, 46-
47). He means by entrepreneurial behaviours:
• opportunity seeking and grasping,
• taking initiatives to make things happen,
• solving problems creatively,
• managing autonomously,
• taking responsibility for, and ownership of, things,
• seeing things through,
• networking effectively to manage interdependence,
• putting things together creatively,
• using judgement to take calculated risks.
In the hard core of entrepreneurship there are many different ways of thinking which vary between the
writers. For example according to Koiranen & Ruohotie (2001, 111) entrepreneurship is a holistic,
responsible and innovative way of thinking, acting and being to the working life. It can be seen as the
affective, conative, and cognitive mental properties. In the cognitive area there are for example skills
and the knowledge. But we can see the values and attitudes in entrepreneurship in the affective area as
well. We can see the motivational things and orientations in the conative area. (Snow, Corno & Jackson,
42
1994, 243-248) All these things determine the entrepreneurship as well and they should also be paid
attention to.
On the other hand entrepreneurship is strongly associated with the abilities to recognize the
opportunities in the environment and to exploit them (Kyrö 2005, 15; Carrier 2005, 1; Gibb 2005, 5).
That means especially the ability to see and sketch different states of affairs in the future. A man should
also believe in his own influence on the things that will happen. In other words we need proactivity.
(Heinonen & Paasio 2005, 22)
The concept of opportunity includes the possibility that things go in a planned way. But it also includes
the threat that the things will not do so in a planned way. It means that the concept of risk also concerns
strongly entrepreneurship. The entrepreneurs should be able to live with the uncertainty. (Kyrö 2006,
100)
As a conclusion from the things mentioned above, we would like to present the definition that describes
our thinking: Entrepreneurship is not only being or becoming an entrepreneur. It is holistic, visionary,
innovative, responsible and proactive action with other people to recognize and exploit opportunities.
And entrepreneurship can be learnt in an entrepreneurial way.
2.4. Competence
Competence means not only knowledge, skills and mental qualities of human being that drives him/her
to work. As Helakorpi (2007) lists, we can give:
• Competence is both individual and social.
• Competence is a result of both formal, informal and non-formal learning
• Competence in not only knowing or skills but it is seen more and more as managing the doing
including especially the social interaction.
• Competence includes flexibility, living with insecurity and willingness to change and to be
changed.
• Competence is continuous assessment and development.
• Competence is linked to the context and the culture.
The objectives of learning should be the competences. We could define them “The student is able to
find out the possibilities in his/her substance” It means for example that during their studies the students
of handicraft learn to find out different possibilities to get employed. They may make real products and
try to sell them to real customers. They are allowed to take managed risks and have some insecurity in
their studies. And so on. A very important point is also that the assessment should be targeted to the set
objectives, the competences.
As already mentioned, a good method or learning environment to learn entrepreneurial competences is
to incubate the ideas of the students in an entrepreneurship incubator. At HAMK University of Applied
Sciences there are several incubators and in the following we will present them as case-based teaching.
Or as we rather say “Case-based learning in entrepreneurship education.”
43
3. Description of the application of the model at HAMK University of
Applied Sciences
The objective of pre-incubator activities in seven units of HAMK is to learn about entrepreneurship and
to learn by actually being involved in business. The activities are divided in three stages:
- learning to understand entrepreneurship,
- learning by actually being involved in business,
- learning to do business. (Saurio 2003, 117).
The division clarifies the specification of objectives. This means that actual municipal business
incubators are left with the task of further developing and supporting business start-ups, i.e. learning to
do business after graduation. This is why the primary indicator for pre-incubator activities is not the
number of enterprises created, but the quality of activities and the number of students and studies
completed within a pre-incubator’s learning environment. A pre-incubator is, first and foremost, a
learning environment for studying entrepreneurship and business activities.
The objectives for pre-incubator activities specified in the degree programmes’ performance agreements
for 2005–2007 are listed in the table below. The same table also shows the quantitative student
situation for each unit as at 30
th
April 2007.
TABLE 1. The students in the incubators of HAMK UAS
Unit
Target student
numbers in
the degree
programmes’
performance
agreements
for 2005–2007
Situation
as at
1
st
Nov.
2004
Situation
as at
31
st
Oct.
2005
Situation
as at
30
th
Apr.
2006
Situation
as at
31
th
Oct.
2006
Situation
as at
30
th
Apr.
2007
Credits
At
30
th
Apr.
2007
Visamäki 70 57 55 73 29 28 71
Forssa 6–7 7 18 15 15 57 240
Lepaa 10–12 9 13 18 17 19 196
Mustiala 8–9 4 4 41 62 59 397
Riihimäki 29
Not available
7 11 10 22
Valkeakoski 6 5 7 13 2
Not available
Evo 1–2 3 0 0 20 12
Total 130–143
(~135)
85
(excl.
Riihimäki)
102 171
155
197 904
Pre-incubators have been developed systematically in co-operation between pre-incubator leaders and
degree programme contact people and teachers involved in pre-incubator activities. In addition to
student counselling and guidance, other key aspects of these activities include training for mentors
participating in the activities. Five training events were organised in 2004, dealing with topics such as
the status of the student, the role of the leader, student counselling at the pre-incubator, constructive
assessment and finances. Training events in 2005 focused on entrepreneurship education and
developed a pre-incubator strategy, networking and business co-operation. Each unit organised an
open day to present and market pre-incubator activities to students, teachers, other staff members and
partner enterprises.
44
The Action Learning method has formed a key part of pre-incubator pedagogy in HAMK University of
applied sciences. By working in a small multidisciplinary ‘set’ (group), students receive constructive
feedback for their actions, new insights and encouraging support from their peer group. The
multidisciplinary nature of sets has been considered to be useful, because it allows students to receive
feedback both from students specialising in other fields and from those studying the same field. At the
same time, Action Learning set participants’ self-knowledge and perception of other people’s behaviour
increase, while their ability to ask questions, listen and converse improves. Action Learning is about
development of business ideas and of the students themselves. Development is accomplished in a form
applied to each student’s own needs, in a practical manner and by solving real-life problems.
Action Learning has made it possible to achieve successful learning experiences. Action Learning sets
have produced clear and immediate benefits for development of students’ own enterprises or business
plans. Students have learnt to ask questions and listen to other people as well as to provide and receive
constructive feedback. They have time to think and reflect on their own views between set meetings.
Students also learn to network while they are still studying. Many have adopted a new, questioning
approach to their work. In addition, pre-incubator students have also put together personal study plans
to support and develop their own pathways towards entrepreneurship. Studies completed using the
Action Learning method provide an average of 5–15 ECTS credits per year.
Pre-incubators may also perform a Thomas Personal Profile Analysis for students in the final stages
of their studies, which provides them with personal feedback both orally and in writing. The Thomas
analysis aims to give an objective and structured overview of a student’s communication and
behavioural style at work. Feedback allows students to improve their self-knowledge and self-esteem. At
the same time, students have also received constructive feedback about functioning as an
entrepreneur, their communication styles and their supervisory and sales skills. To date, pre-incubators
have already done Thomas analyses for about twenty students.
The HAMK University of Applied Sciences Starttihautomo co-operative was established in the spring
of 2004. The co-operative is a company supporting pre-incubator studies and students’ entrepreneurial
activities, where students can safely practise business operations while studying, without losing their
student status or benefits. The co-operative allows them to combine studies and entrepreneurship in
practical terms during studies. The purpose of the co-operative is to function as a marketing channel for
pre-incubator students’ own business ideas, their own products or the products and services of a
potential business enterprise and as a platform for practical entrepreneurship training. Students have
the opportunity to join the co-operative while they are studying.
The Sense business plan competition aims to kick off new business ideas, teach about business
planning and create new ideas, innovations, human capital and networks and to produce additional
positive energy for work, growth, learning and life in general (www.sense.hamk.fi). The idea behind the
Sense competition is to provide expert lectures at the beginning of the competition followed by a
brainstorming and writing process to support students and finally public presentation of entries. Sense is
an open business plan competition, which has been organised ever since 2001. The first competition
aimed to invent something completely new and to make way for creative thinking. Participation in
various business plan competitions has supported students in their entrepreneurship studies.
Co-operation with other promoters of entrepreneurship is carried out on a daily basis. Training
events have been organised in different locations in co-operation with business incubators maintained
by municipal business development departments, while joint plans have been made to promote
entrepreneurship based on the above-mentioned division of roles. HAMK pre-incubator activities have
developed considerably during the three years of operation. A pre-incubator is a learning environment
providing students with opportunities to complete entrepreneurship studies, projects and work
45
placement and prepare their own Bachelor’s thesis relating to product development, business plans,
marketing or developing their own business operations. Pre-incubators provide learning through
reflection and experience. Learning is problem-based, self-directed, goal-oriented and action-based
learning by doing. Pre-incubator activities aim to increase awareness of entrepreneurship and business
activities. The HAMK pre-incubators and Action Learning as a pedagogical process help students
choose study units aiming at setting up and running a business. Pre-incubator activities support
students’ learning process through counselling, guiding and training them towards the world of
entrepreneurship by interactive and community-based means.
References
Carrier, (2005). Pedagogical challenges in entrepreneurship education. In Kyrö, P. & Carrier, C. (Ed.)
The Dynamics of Learning Entrepreneurship in a Cross-Cultural University Context. Entreprenreurship
Education Series 2/2005. University of Tampere. Faculty of Education. Research Center for Vocational
and Professional Education.
Gibb, A. (2005). The future of entrepreneurship education – Determining the basis for coherent policy
and practice? . In Kyrö, P. & Carrier, C. (Ed.) The Dynamics of Learning Entrepreneurship in a Cross-
Cultural University Context. Entreprenreurship Education Series 2/2005. University of Tampere. Faculty
of Education. Research Center for Vocational and Professional Education.
HAMK University of Applied Sciences. Retrieved May 24, 2007, fromhttp://portal.hamk.fi/portal/page/portal/HAMK/In_English/About_HAMK
Heinonen, J. & Paasio, K. (2005). Sisäinen yrittäjyys kuntatyössä. Kunnallisalan kehittämissäätiön
tutkimusjulkaisut nro 48.
Helakorpi, S. Osaaminen ja sen arviointi. Retrieved May 23, 2007, fromhttp://openetti.aokk.fi/seppoh/osaamismittarit/index.htm
Koiranen, M. & Ruohotie, P. (2001). Yrittäjyyskasvatus: analyyseja, synteesejä
ja sovelluksia. Aikuiskasvatus 2/2001
Kyrö, P. & Carrier, C. (2005). Entrepreneurial Learning in universities: Bridges across borders. In Kyrö,
P. & Carrier, C. (Ed.) The Dynamics of Learning Entrepreneurship in a Cross-Cultural University
Context. Entreprenreurship Education Series 2/2005. University of Tampere. Faculty of Education.
Research Center for Vocational and Professional Education.
Saurio, S. (2003). Yrittäjyyden edistäminen ja yrityshautomotoiminta ammattikorkeakouluympäristössä.
Satakunnan ammattikorkeakoulu, A, tutkimukset 1/ 2003. Pori: Satakunnan ammattikorkeakoulu.
Snow, R.E., Corno, L. & Jackson, D. (1994). Individual Differences in Affective and Conative Functions.
In Berliner, D.C. & Calfee, R.C. (eds), Handbook of Educational Psychology. New York. Simon &
Schuster Macmillan, pp. 243-310
46
Entrepreneurship Promotion Cooperation Model in Kajaani and Kainuu
”Promoting Entrepreneurship in Kainuu”
Entrepreneurship Path Cooperation Model
Päivi Malinen, MSc
Kajaani University of Applied Sciences
[email protected]
+ 358 44 7101 612
Päivi Partanen, MSc
Intotalo, Entrepreneurship Training Centre
[email protected]
+ 358 44 3229 222
Keywords:
cooperation, learning by projects, learning by doing
47
1. Background to the entrepreneurship Path
The development of entrepreneurial attitudes and entrepreneurial skills is high on the list of regional targets. In
the future Kainuu will need more and more entrepreneurial personalities who are creative, independent and
self-confident solution seekers possessing good taste, good social skills and a capacity for independent
thinking. According to research, 49 % of students studying at Kajaani University of Applied Sciences are
interested in entrepreneurial activities. (Eronen Auli, 2005)
The development of entrepreneurship within the local authority of Kajaani is the responsibility of the Kajaani
Technology Centre Oy /Business Development Department. The Business Incubator (Entrepreneurship
Training Centre) Intotalo is responsible for supporting and organising training for recently established and new
businesses. Intotalo has been operating in Kajaani since the beginning of 2003. During the autumn of 2005
Intotalo also started operating in Vuokatti within the vicinity of Snowpolis.
It has been necessary to find new ways of working and to carry out widespread cooperation between different
parties in order to meet the challenges posed by entrepreneurship in the region. The aim of such cooperation
has been to create structures and support networks to make starting up a business easier for new
entrepreneurs. The goal is to enthuse university graduates with the desire to start out in business.
Intotalo started as an ESF funded project and its operations became permanent in 2006. Thus a permanent
and successful cooperation model and structure has been created in Kainuu that involves Intotalo, Kajaani
University of Applied Sciences and other educational institutions and businesses.
Learning Environment-Business Incubator Intotalo
Kajaani University of Applied Sciences entrepreneurship path’s main learning environment is the Intotalo
Business Incubator. Intotalo is a learning environment that advances learning in skills required in project work
and running a business. Learning in the Intotalo is based on constructivism i.e. learning by doing. The learning
process can also be described as a combining of theoretical and practical knowledge and self-knowledge (e.g.
Research Professor Päivi Tynjälä). According to research, project work and learning by doing effectively
promote the development of an individual’s business skills and above all, generate an entrepreneurial attitude.
The most important value of the Intotalo is community. It strives to create an atmosphere and environment
where small businesses can work together instead of alone. Through such a community it is easy for
businesses to network with other companies and active parties in the Kainuu region. Start-up entrepreneurs
and entrepreneurship students have had positive experiences of the Intotalo at the outset of their business
activities. They received valuable help from others in creating their own customerships and other practical
issues related to running their own businesses.
Kajaani University of Applied Sciences and Intotalo work in close collaboration to promote entrepreneurship in
Kainuu. Intotalo is Kajaani UAS’ business incubator. Their common aim is to discover new, start-up
entrepreneurs amongst the UAS students for the incubator and to advance the development of up and running
and developing companies from the outset.
48
2. The aim of Cooperation
The aim is to recognise and find potential entrepreneur personalities from the different fields of Kajaani
University of Applied Sciences and offer them the opportunity to develop their own business idea in practice.
The target is to ensure that cooperation between Kajaani UAS and Intotalo will lead to 5 % of all graduates
from Kajaani UAS establishing their own companies within five years of graduation.
3. The Entrepreneurship path in practice
Every spring Intotalo organises an open business idea competition in which participating Kajaani UAS
students can develop their business ideas with the help of Intotalo’s network of mentors. This support will be
focussed on the best business ideas presented to the selection panel. The main competition entrance
requirement is that the idea can be implemented in Northern Finland.
Students are able to test their own ideas and skills in practice via their studies and the business incubator
organised by Kajaani UAS and Kajaani Intotalo. It is intended that 10 start-up businesses will be found per
year for the business incubator.
Completed actions:
- Planning of entrepreneurship studies in co-operation with Kajaani UAS entrepreneurship liaison
teachers and Intotalo
- Marketing of entrepreneurship courses to Kajaani UAS students and courses delivered at the
Intotalo
- Supports the development of start-up businesses in the different fields of Kajaani UAS and provides
entrepreneur personalities the opportunity to develop their own idea in the incubator.
- The Intotalo Incubator offers students a workstation, a customer and co-operation network and
training in running their business operations and creating their own customer base.
- Graduates of Kajaani UAS
o The aim is to maintain contact with Kajaani UAS graduates and to support the development of
their entrepreneurial skills and knowledge.
o The willingness of Kajaani UAS graduates to go into business will be surveyed.
o The results of the surveys will be used to plan and market incubator-run training courses, a
possible second-cycle UAS degree qualification and specialised studies.
The business incubator entrepreneur courses to be completed during
university of applied sciences studies
Study Modules Contents Description
Innoste-Business
Idea Competition
A regional business idea competition open to all UAS students for the purpose of
seeking business, product and service concepts for further development. The ideas
and concepts under development presented during this competition can also be
entered in the national Venture Cup business concept competition.
49
Entrepreneurship
Course
9 cr
Students will gain a realistic view of their own opportunities and will make contacts with
other businesses in the region through different commissions and jobs. Students will
determine common aims for their own entrepreneurial skill development in teams. This
course is worth 9 credits (3 + 6). It comprises team training sessions, reading and
practical business ventures.
Business Plan
5 cr
Students must compile their own business plan based on their business idea in
collaboration with the Intotalo trainer and UAS instructor/teacher. Each student will
contact a mentor for support and encouragement in the development of their own
businesses. This course is worth 5 credits.
Practical Training in
Entrepreneurship
30 cr
During the practical training period students will develop their own businesses
according to their business plan. They will try out whether they can successfully
operate a profitable business venture. The practical training period consists of practical
customer – commissioned projects, compiling a business foundation plan and
development work in cooperation with the Intotalo trainers and an experienced mentor.
The practical training period is worth 30 cr. Intotalo provides the students with
workstations and supportive encouragement to develop their theses.
Entrepreneurship
Thesis
15 cr
The students must complete a thesis that includes a practical analysis of the business
they have/are to create and their market areas using applied theory. The thesis is
worth 15 credits. Intotalo provides a workstation as well as encouragement and
support.
Postgraduate path
Incubator - training The target group of the business incubator includes graduates planning to go into
business and small businesses that have recently started operating and that have a
“brilliant idea” or wish to make the most of the opportunities that are on offer in the
locality. The training course comprises entrepreneurship training sessions, the practical
realisation of their business ventures and mentoring. The training course lasts 1 – 6
months.
Entrepreneurship
Sparring partners and
Mentors
Intotalo’s trainers spar on those planning their own business ventures to develop their
own knowledge, networks and customer contacts. UAS students can also take
advantage of the Intotalo mentor network. Those who are planning their own
businesses can also try out their first customer contacts through the Intotalo
Cooperative.
Entrepreneur
Community
Intotalo offers new entrepreneurs workstations, office infrastructure to support the
development of their business and communal support. The business trainers provide
support in compiling the business plan and marketing. The managing directors of the
Intotalo companies meet once a month at their own development and strategy evening.
50
4. Results of cooperation 2003 - 2006
As a result of the common entrepreneurship path, 8 new businesses have been established over the last three
years by UAS graduates. The aim is to further develop such operations and discover 5 new budding
businesses each year. These activities, that originally started as part of a project became a permanent fixture
on 1
st
January 2006.
EXAMPLES OF ESTABLISHED BUSINESS VENTURES:
Momentti Oy
The company offers fresh solutions in the form of sales and marketing publications, product representation,
event marketing, import and marketing surveys. www.momentti.fi
Lähellä Sydäntä Ay
The women who established this care service company already had their business plan ready during their
UAS studies. The name of the company (Close to my Heart) tells you all you need to know about the quality of
their services and the company’s values.
Tilipalvelu Elisa Ohtonen
This effective one-woman accountancy firm carries the entrepreneur’s name. Elisa gained practical work
experience during her UAS studies by taking care of the UAS Learning Company’s financial administration.
www.tilipalveluelisa.fi
Signalia Oy
A company that focuses on PR, communication and media contents production.
www.signalia.fi
3D-ilme
3D image manipulation specifically for house construction and interior design.
www.3d-ilme.fi
Reboot
IT support Reboot offers IT support to small companies.
www.reboot.fi
Mille Trade Oy
A company operating within the field of exports to Italy.
www.milletrade.fi
Western Training
A riding coaching company.
www.westerntraining.fi
51
Kajaani University of Applied Sciences / Intotalo
ENTREPRENEURIAL SKILLS 60 cr
This module comprises entrepreneurship training, reading and practical customer relationship creation.
Studies will be carried out in teams of approx. 10 persons that will be formed from the course applicants,
according to the Pelp team role test results. The main training location will be the Kajaani Intotalo and students
will also have the opportunity to operate in the Vuokatti Intotalo within Snowpolis.
The student team will be given their own workstation in Intotalo for the duration of the module. They will be
guided and supported by their instructors and the Intotalo trainers and experienced mentors.
Description of the module:
1. Creativity in practice
Credits 3 cr
Aims Students will gain a realistic view of their own opportunities and will make contacts with other
businesses in the region through practical commissions. Students will determine common aims for
their own entrepreneurial skill development in teams.
Contents Creativity and innovation, own creativity profile, customer interface and observation of business
opportunities, features of an entrepreneur and creation of networks.
Required data Application, Pelp’s role test
Assessment requirements Team training sessions (24 H), business commissions, essays based on reading (3 points),
personal learning agreement
Recommended reading Coelho: Alkemisti
Koski & Tuominen: Kuinka ideat syntyvät
Johansson: Medici ilmiö
Nordström&Ridderståle: Karaoke kapitalismi
Peltola: Jokaisella on juttunsa
or three points (3 p) worth of reading from the Entrepreneur’s Best Books Guide/Yrittäjän Parhaat
Kirjat valintaoppaasta.
Instructor/s Päivi Partanen, Olli Leppänen
Evaluation Pass/Fail
Other The student team will be given their own workstation in Intotalo.
2. Practical Business Ventures
Credits 6 cr
Aims Students will create customer contacts and test their own entrepreneurial and project skills in
practice together with their team.
Contents Leading customerships, practical project leadership, time management, team leadership,
marketing and innovation. An entrepreneurial attitude.
Required data A pass in 3 cr of Creativity Studies.
Assessment requirements Team training sessions (48 H), essays based on reading (3 points.), planning and implementing a
customer project in practice.
Recommended reading Sarasvuo & Jarla: Myynnin korkeajännitys
Storbacka: Asiakkaan ehdoilla
Quinn: Asiakas ykköseksi
Tracy: Advanced selling strategies
Roddick: Business as Unusual
Altmann: Myyjästä voittajaksi
Gad: 4D Brändimalli
Pine&Gilmore: Experience Economy
or three points (3 p) worth of reading from the Entrepreneur’s Best Books Guide/Yrittäjän Parhaat
Kirjat valintaoppaasta.
52
Instructor/s Päivi Partanen
Evaluation Pass/Fail
Other The student team will be given their own workstation and equipment supporting their business
operations in Intotalo Kajaani or Vuokatti. The teams will also receive a small amount of start-up
capital to develop their projects.
3. Business Plan
Credits 5 cr
Aims Students will compile their own business plan based on their business idea. They will contact a
mentor who will support them and spar them on to develop their business.
Contents Compilation and development of the business plan, building a safety net or support networks,
evaluation of the business plan
Required data Application and own business idea
Assessment requirements Entrepreneur training sessions (24 H), business plan
Recommended reading Lehtonen P: Strateginen yrittäjyys
Holopainen & Levonen: Yrityksen perustajan opas
Lyytinen & Piha: Yritä edes!
Collins: Hyvästä Paras
Chan&Mauborgee: Sinisen Meren strategia
Norman: Nomannin liiketoimintateesit or reading from the Entrepreneur’s Best Books
Guide/Yrittäjän Parhaat Kirjat valintaoppaasta
Instructor/s UAS entrepreneurship teachers, Päivi Partanen and the Intotalo trainers and business mentors
Evaluation 1-5
Other The student team will be given their own workstation and equipment supporting their business
operations in Intotalo Kajaani or Vuokatti. Some of the entrepreneurship training sessions will be
carried out with other students in the process of developing their own business ideas.
4. Practical Training
Credits 30 op
Aims Students will be able to take advantage of business opportunities that they have noticed by
establishing and organising their business operations according to their business plan. Students
will test their ability to carry out a business venture in a profitable way.
Contents Development of the company in the business incubator, business foundation plan, mentoring and
creating customerships. Practical customer projects.
Required data Approved business plan
Instructor/s Practical training teacher supervisor,
Päivi Partanen and the Intotalo business trainers and mentors.
Evaluation Pass/Fail
Other The student team will be given their own workstation and equipment supporting their business
operations in Intotalo Kajaani or Vuokatti.
5. Thesis Compiled in own Business
Credits 15 cr
Aims Students will be able to analyse their own business operations and markets in a practical way
while at the same time applying acquired theoretical knowledge.
Instructor/s Thesis teacher supervisor,
Päivi Partanen and the Intotalo business trainers and mentors.
Evaluation Fail, 1 - 5
Other The student team will be given their own workstation and equipment supporting their business
operations in Intotalo Kajaani or Vuokatti. The thesis process is done according to the Kajaani
University of Applied Sciences thesis process.
53
Business Planning 3 ECTS (Business Plan)
virtual based web –course
in Kajaani University of Applied Sciences
MA Pekka Tervonen
Lecturer in economics, business operations and entrepreneurship
Kajaani University of Applied Sciences
Keywords:
business plan, mission, vision, business idea, strategy, risk
Executive summary (abstract)
The main objective of this course is to study the planning targets of a company by means of a
business plan. The pedagogical method used in this course is (LBD) – learning by doing. The
course will be implemented through the Moodle and/or the WebCt virtual learning environments
In this course a student will complete a Business Plan of a real or fictitious company on a
formulated sheet as a word document.
The course includes the company’s mission, business idea and its different parts, analysis of
competition, strategy, finance and profitability calculations, vision, SWOT analysis and a brief
risk management plan. The course does not include the company’s marketing plan. Virtual
studies mean that it is possible to accomplish this course in the by distance learning, which is
very important in sparsely populated areas such as Kainuu and Northern Finland.
The pedagogical aim of the course is to promote enterprise using the LBD (learning by doing)
method or authentic learning. Students can access instructions and material via the Internet
links and model business plans. The course instructor will evaluate the business plans returned
by students and provide feedback. The feedback takes place by the communication tools of the
learning environment. The communication between the instructor and students has not been
very lively depending on the nature of the course. In many cases the representatives of the
target company have supervised the students in problems to complete the business plan
(authentic learning). This course is offered as a free-choice course in all fields at Kajaani
University of Applied Sciences. There is no amount limit for students to access the course. The
instructor resource needed is 4 hours per student.
54
1. Background
One of the main issues that the strategy of the Kainuu region and Kajaani UAS focuses upon is
the promotion of business entrepreneurship in the region. In order to implement this strategy an
entrepreneurship path (described elsewhere in the Bepart project) that includes the creation of
a business plan for a company in the making, was compiled at Kajaani UAS. Not all students
wish to establish a company so it was decided that a compulsory short business plan would be
included in entrepreneurship studies in order to ensure that all Business and Administration
students would learn the different focuses of a business plan, the mission, business idea,
strategies, analysis of competitors, basic calculations, values, vision and risk assessment. The
business plan has achieved this objective well. Kajaani UAS also offers a degree programme
delivered in English, the Degree Programme in International Business leading to a Bachelor of
Business Administration degree qualification. Within the framework provided by the Bepart
project it was decided to compile a Business Planning 3 ECTS course for this degree
programme. The aim of this course is to advance business studies amongst international
students and for it to act as a systematic basis for the business plan that must be compiled
when actually establishing a company.
2. Case description
The aim of the Business Planning course, worth 3 credits, is to promote entrepreneurship
amongst the students with the aid of a business plan. The method used is (LBD) – learning by
doing. The course will be implemented through the Moodle and/or the WebCt virtual studies
environments. Students will save an empty Word.doc business plan in their directories and fill
in the different parts of the business plan using the Web-based business plan. The business
plan can be compiled for a real or fictitious company. The support business plan contains
instructions and links to the entrepreneurship pages of different organisations where students
will find advice and tips on how to complete their own plan. Students can also email fellow
students and the course instructor to ask for advice concerning their own business plan. The
completed business plan must be returned to the study environment where the instructor will
read, evaluate and comment on it. During evaluation the instructor will be focusing on whether
the plan is logical or not, the compatibility and cohesiveness of the different parts of the plan
and how much the student has learnt about entrepreneurship. Less attention will be paid to
finance and profitability calculations during evaluation. If students really intend to establish a
company they are advised to compile the necessary calculations with the aid of Finnvera or the
Employment and Economic Development Centre in case they require loans or business
support services and financing. Students are also able to accomplish a so-called long business
plan within the context of the Kajaani University of Applied Sciences entrepreneurship path. In
this case it is also necessary to compile a marketing plan for the company.
This course is open to all students in all schools at Kajaani University of Applied Sciences and
it can be included in their free-choice studies. It is also part of the course selection offered by
the Finnish Virtual University of Applied Sciences (www.amk.fi) and where several students
have already completed it. The completed business plans have been good on average and the
promotion of entrepreneurship has progressed according to the goals set. There have been
some problems with the required calculations, though they were not the most important issue in
the course objectives.
55
3. Current challenges/problems facing the organization / project
experience or educational effort
The challenge of the course and its learning provision concerns evaluation and feedback. How
and in what way should feedback be provided? Using the Moodle and/or WebCt virtual study
environments, feedback is provided in an evaluation field located underneath the student’s
personal user ID and password, that the student can access whenever he or she wishes to do
so. At the same time they can also see their grade. Feedback should be critical yet it should
encourage students to become entrepreneurs. Please see the examples of feedback provided,
below:
The mission, vision and values are well defined. The parts of business idea are linked with each other. Also
the competitor analysis is well done. The calculations are not exactly according to the instructions. You
know the value amounts better than I, but usually the total amount of capital need is equal to the financing
total. In the profit statement you estimated no net profit for the first year. This is how it is done for the first
year. If you were a sole trader, your salary would be the estimated net profit. Usually you do not pay YEL
(self-employed person’s pension) if you pay yourself a salary in your company. Your pension fee is
organized through the TEL (employed person’s pension) pension system. As far as I understand, your
business is as a sole trader (private entrepreneurship).
The strategy of the company is well done, too. The customer needs table is good. The conclusion of the
Strategy table has been carried out according to the SWOT –analysis. The risk management table is very
good.
The business plan meets the requirements of this assignment well. Grade 5
The mission, vision and values are well defined. The parts of business idea are linked with each other, but it
is hard to find how your business idea differs from that of the competitors. What is the core know how of
your company? (mystery shopping?) Also the competitor analysis is well done. The calculations are not
exactly according to the instructions. I do not pay much attention to the figures, because this is an exercise.
You know the value amounts better than I, but usually the total amount of capital need is equal to the
financing total. Usually you do not pay YEL (self employed person’s pension) if you pay yourself a salary in
your company. Your pension fee is organized through the TEL (employed person’s pension) pension
system. Here, you should pay the YEL -pension fee, because you do not pay wages to yourself and your
partner.
The strategy of the company is well done, too. The customer needs table is good enough. The conclusion of
the Strategy table has been carried out according to the SWOT –analysis. The risk management table is
satisfactory.
The business plan meets the requirements of this assignment. Grade 3
If there is a lot of information missing or a lot of corrections, students must correct and
complete their business plans and then resubmit them for evaluation.
4. Further reading and list of additional sources
Suitable reading for this course includes any kind of handbook or study book covering
entrepreneurship, business economics, marketing, accounting and law studies. The
Internet also contains huge amounts of information. Below you will find a few links:
Click here for different websites to study the planning targets of entrepreneurship and the
business plan and to learn how to do business in general:
• OCRI (Canadian Entrepreneurship Centre)
• SBA (United States Small Business Administration)
• How to write a business plans (includes sample business plans)
56
• Enterprise Finland (website to start business in Finland)
• Business plan calculators
• Startup Nation (10 steps to start your business)
• Tutor2 (mission, vision, SWOT, values, strategies)
• QuickMBA (mission, vision, SWOT, values, strategies)
• Risk Management
• How to write a marketing plan?
• Sample marketing plans
5. Appendix
Below instructions on how to log into the Business Planning 3 ECTS course.
BBA Website
The BBA courses in Kajaani University of Applied Sciences over the Internet will be offered in
Moodle. You can found our e-learning environment from:http://montana.kajak.fi/moodlebba/
Moodle is a web-based Virtual Learning environment program that allows the classroom to
extend onto the web.
You must create your own username and password to access the environment:
click LOGIN in the top right hand corner,
You'll need to take a minute to create a new account for yourself on the web site. Each of the
individual courses may also have a one-time "enrolment key", which you won't need until later.
Here are the steps:
1. Fill out the NEW ACCOUNT form with your details.
2. An email will be immediately sent to your email address.
3. Read your email, and click on the web link it contains.
4. Your account will be confirmed and you will be logged in.
5. Select the course you want to participate in.
6. If you are prompted for an "enrolment key" - use the one that your teacher has given
you. This will "enrol" you on the course. The enrolment key is "pisnes".
7. You can now access the full course. From now on you will only need to enter your
personal username and password (in the form on this page) to log in and access any
course you have enrolled on.
8. On the homepage click Free choice studies, then click Business Plan 3 ECTS. and
start writing your business plan according to the instructions, tips and links.
You can always RELOGIN- from same place ( left side).
After registering check your PROFILE in the top right hand corner ("Your Name"). To edit your
personal information, click on "Edit Profile".
If you have questions about your course, please contact your teacher.
If you have problems with the Environment (username or password are missing), please
contact the administrator: [email protected]
57
Business Plan in Word –format
P.O. Box 52
87101 KAJAANI
FINLAND
Tel. +358 8 618 991
Fax +358 8 6189 9424
Business Planning
Business Plan 3 ECTS
BUSINESS PLAN
Date of the plan:
Author/s:
Name of the Company
and contact information:
58
1. Basic Information of the Company
Name of the Company and type of Company
Mission:
Owners:
Managing Director:
Regional marketing area and inhabitants:
Typical features for the branch:
59
1.1. Information of the Entrepreneur(s)
Name
Education
Work experience
Entrepreneurial experience
Hobbies and other activities
supporting entrepreneurship
Motives for entrepreneurship?
Why do I want to become an
entrepreneur? Comment on
your entrepreneurship test.
Name
Education
Work experience
Entrepreneurial experience
Hobbies and other activities
supporting entrepreneurship
Motives for entrepreneurship?
Why do I want to become an
entrepreneur? Comment on
your entrepreneurship test.
60
2. Environment of the Company
2.1. Competitors
Our core competitors are:
Name of the competitor (Reasons why?)
Our marginal competitors are:
Name of the competitor (Reasons why?)
Our potential competitors are:
Name of the competitor (Reasons why?)
What is the competitive situation? How do the companies in your branch compete? What is the vision of the market?
61
2.2. The Projected Situation of the Company
2.2.1 Business Idea
business idea
Customer´s needs
Image
Customers/target groups
Product/Services
Operational mode that the Company employs (How does the Company work?)
Resources
Physical Economic Human
62
2.2.2 Operational Mode (How to do Business?)
How do you get customers? Marketing communication tools?
Product development. Product range
Pricing
The sales operations
63
Organising the purchases. Chain or wild? Storage?
Transportation, delivery of the goods and services to the customers?
Services and administration (offers, orders, book keeping, wages and agreements)
64
2.2.3 Financial Analysis of the Company
2.2.4. Capital need
1. Investment schelude - .
Target cost
Machinery
Equipment
Buildings
Other long term investments
Total
2. Short term working capital
Inventories
Cash needed at the beginning before cash flow
Total
CAPITAL TOTAL (investments + working capital, transfer to total financing next
page)
65
2.2.5 Financial Plan
+ equity capital
cash
other property
oparating income (net cash inflow)
+ borrowed capital
banks
Finnvera
other
+ subsidies
TE-centre
other
= FINANCING TOTAL
Securities:
66
2.2.6 Projected Profit and Loss Statement
1.1.1 net profit
+ loan repayments
+ interests
= need for net profit
+ operating fixed expenses:
gross wages
social security expenses
rent
electricity and water
travel expenses
repairs and maintenance
marketing and PR
purchase of services (fixed)
entrepreneur´s pension (YEL)
entrepreneur´s unemployment insurance
insurance
other
= need for gross profit
material purchases
= turnover
+ value added tax (VAT) 22 %
= Total sales
67
2.2.8 SWOT –analysis of the Company
SWOT-analysis
Company´s internal
Strengths
Weaknesses
in environment and in the future (external)
Opportunities
Threats
68
3. Strategic Planning
3.1 Choice of the Generic Strategy
Alternatives are:
Low cost leadership Differentiation
Focus (low cost) Focus (Differentiation)
Generic strategy of the Company is
because
3.2 Customers:
Customers
/target groups
Customer´s special needs for products and services
69
3.3 Product Portfolio Strategy
Classify Company´s products
Star products : Question mark products:
Cash Cow products: Dog products:
70
3.4 Conclusion of the Strategy (Actions to make the Strategy concrete, what do you do?)
Company´s internal
in environment and in the future
(external)
Strengths
Weaknesses
Opportunities
Utilize (succes strategy)
Develop (development strategy)
Threaths
Get prepaired for (substitute strategy)
Avoid (existencestrategy)
71
4. Vision
4.1. Company´s values and vision
Company´s values are:
Company´s vision is: (up to 5 years)
72
5. Risk Management
Company´s external risks are:
Company´s internal risks are:
How does the Company manage risks? (remove, decrease, transfer risks)
73
ROXI Entrepreneurship Training Programme
ROXI – Case Study of Rostock University
Doreen Holtsch & Melanie Hoppe
Rostock University
Chair of Economic and Business Education
1. Learning Goals
content-related: promoting personal entrepreneurial competencies
implementing a competence-analysis
using creativity methods (e.g. Brainstorming)
implementing a SWOT-analysis on business ideas
soft skills: promoting empathy
developing skills to reduce complexity
2. Executive Summary
This case demonstrates a situation from ROXI entrepreneurship courses held at the University in Rostock
(Germany).
The case focuses on the content of the first week of a full time course with a full duration of three weeks. The aim
of this particular week is to define a clear business idea which corresponds to the potential entrepreneur. The
trainer is challenged with a diversity of participant’s qualifications and needs. Main tasks of the trainer are
• to get familiar with the entrepreneur and their business ideas;
• to instruct the participants to critically evaluate their ideas;
• to use a broad mix of different instruments, e.g. creativity methods, Johari-Window or SWOT-analysis;
• to create an atmosphere in which not just knowledge is being delivered, but the participants’ action and
personal development is in the focus.
74
3. Background
3.1. Institutional background of the programme “roxi”
The Rostock entrepreneurship initiative roxi (ROstocker-eXistenzgründer-Initiative) was founded in 1997/1998 by
the Institute for Human Resource Development, the forerunner of today’s Hanseatic Institute for Entrepreneurship
and Regional Development – HIE-RO
1
.
Before 1997, no specific entrepreneurship education was offered at the University of Rostock. The programme
roxi (ROstocker-eXistenzgründer-Initiative) aimed to close this gap with its training courses.
Background of the idea to start roxi was amongst others the high regional unemployment and low economic
growth rate in the region Mecklenburg-Western Pomerania.
2
The innovation of an entrepreneurship training
programme was thought as a long-term-approach to contribute to regional growth and at the same time to offer a
new and so far missing stepping stone for potential entrepreneurial talents with university background in the
region of Rostock. The initiative for the Rostock entrepreneurship initiative roxi took off at the Chair for Economics
and Business Education. Two members of the Chair and other supporters first took initiative to establish a new
institute at the University of Rostock. The foundation of the Institute for Human Resource Development in the
year 1997 created (as a first step) the needed new platform for the later entrepreneurship training as a
supplement to the regular University courses.
Since the year 1997, the financing for roxi is provided by the European Social Fund together with funding by the
Ministry of Labour and Economy of the German State of Mecklenburg-Western Pomerania. This funding
background is one of the reasons why the number of created start-ups and new jobs are some dominant success
indicators which roxi has to deal with.
While in the year 1997 roxi was a new programme, an empirical survey in 2005 among students at the University
of Rostock emphasised its popularity - 87 percent of the students are aware of the courses offered by roxi and the
project itself
3
.
Since the beginning, roxi aims to inspire entrepreneurial spirit and to support people (especially students,
graduates and scientific staff) in setting up business. In doing so, the initiative’s philosophy is: not everybody is
born as an entrepreneur but can learn to act as one. The aim is to stimulate sustainable entrepreneurial
businesses and to support the process of founding a business through effective training, coaching and consulting.
roxi seeks to promote entrepreneurial thinking at the University and to smoothen the way into professional
independence by setting up a personal business.
The target group are students, graduates, researchers and study drop-outs from different faculties. The roxi -
trainers are teaching along the “learning-by-doing” approach by mainly using the action learning method.
However, this method facilitates real entrepreneurial competencies through providing a mix of knowledge,
attitude, skills and customs combined with economic and business know-how.
Twice a year a full time roxi-course is offered during summer and spring break with a duration of three weeks or
120 training hours. During the semester on Friday evenings and on Saturdays a part-time course is offered over a
period of ten weeks.
While regular university courses are so far free of charge in Germany, roxi asks for small participant fees.
Participation costs roughly 100 EUR for a three week course. The idea behind the fee is twofold: (1) to keep free-
riders out of the course and to support commitment by setting up a small barrier, and (2) to cover cost (e.g. for
catering/ drinks/ fruits) which otherwise could not be paid out of the given programme funding.
1
Further information are available on: www.hie-ro.de
2
Braun, G.; Diensberg, C.; Mechthold-Jin, M.: Mut zur Selbständigkeit, Gründungstraining und Gründungsforschung am
Institut für Human Resource Development, in: Traditio et Innovatio, Forschungsmagazin der Universität Rostock, 3 (1998), 1,
S. 13-16.
3
Wilde, Kerstin (2005). Entrepreneurship Education – konzeptionelle und didaktische Herausforderungen. Kompetenz für
Komplexität? – Ergebnisse der Studentenbefragung in Rostock 2003. Eine Studie von ROXI, Rostocker Existenzgründer
Initiative in Zusammenarbeit mit GründerFlair, Netzwerk für Existenzgründungen aus Hochschulen in Mecklenburg-
Vorpommern. Rostocker Arbeitspapiere Nr. 24. Rostock.
75
3.2. The Action Learning Method
Reg Revans is one originator of the action learning method. He itself describes it as “freedom from teachers, from
any kind of printed syllabus or regulations, from any fixed institution, or even from any literature”.
Revans describes his approach in a formula
4
: L = P + Q where the variables L, P and Q are learning,
programmed knowledge and questioning. The questioning part is regarded as central in which the nature of the
problem is being clarified and possible solutions are identified. This group process generates a dialog through
which innovative thinking is generated.
Generally speaking action learning is another form of the Problem-Based-Learning approach. Main distinction is
the fact that the “problem” needs to be real. The groups consist of 4 – 6 members, at the end an action plan has
to be elaborated by the group and real actions have to be undertaken.
The coach or teacher takes the role of a moderator or rather advisor. He has the task to facilitate the process of
the single members, to reflect the periods of learning and problem solving. In doing so he has to support the
dynamic in the group by reflecting the feedback given among the group members and to assure that the
established procedural rules are obeyed. In a next step, together with the participants, he reflects the elaborated
solution. Therefore it is important to document every step. Trough questions the trainer requests the participants
to give objective reasons and to judge the solution.
All together the focus of the seminar is on the participants and the trainer has to be in control of several tasks,
e.g.:
• analysing the target group;
• analysing the training demand;
• planning the team work, team and problem solving;
• developing a training plan;
• proper use of teaching and learning material;
• “Icebreaker” and “Energiser”;
• moderating the group reflection;
• evaluating the target.
3.3. Setting the scene
It is February 2005 and last week the spring break started. Six people signed in for the roxi course. The different
topics and exercises require a lot of different locations. Due to this the roxi employees organize different facilities
at the University. All rooms are equipped with video-projector and moderation equipment.
The different topics and exercises require experts with different competencies. Due to this in each course
approximately 13 trainers are involved; e.g. while one trainer is responsible to raise the participant’s awareness
and to develop their entrepreneurial competencies; another trainer is responsible to develop, select and screen
the participant’s ideas. The twelve roxi course modules are organised along the four CEFE
5
- stages:
4
IFAL – International Foundation for Action Learninghttp://www.ifal.org.uk/brief.html (am 24. November 2007)
5
The Competency based Economies Formation of Enterprise is a set of training methods using an action-oriented approach.
“CEFE’s main objective is to improve the entrepreneurial performance of economic actors through guided self-analysis,
simulating enterprising behaviour, and the build up of business competencies” (www.cefe.net/forum/CEFEshort.pdf). More
information are available on www.cefe.net
76
Figure 1: CEFE-stages (CEFE – Manual for Trainers (1998). CEFE – International)
Since 2002 Mrs. Meier is the project leader of roxi. Working as a consultant in the business and development aid
sector she gathered comprehensive knowledge and experiences in educating entrepreneurs. Within the roxi
training she is doing the course introduction in which the focus is to analyse the participant’s competencies.
Furthermore, she is the participant’s contact person regarding all matters during the whole course.
Another trainer from the trainer pool is Mr. Bunge. He is working as a freelancer for roxi. Next to this he is
involved in the physiotherapy practice of his wife where he is responsible for all managerial and administrative
matters. This is now his third time working for roxi. His specialisation is to coach the potential entrepreneurs to
generate and to set up a business idea.
4. Case Description
To assign for the roxi training the participants fill out a standard form to provide the necessary contact details. But
of course this form doesn’t provide the trainer with further information concerning the business idea, the course
motivation, etc. Due to this, for every course Mrs. Meier invites the “would-be entrepreneurs” to an individual
meeting. During this meeting she receives a rough impression of the person and the motivation.
This year the situation is as follows: Mrs. Meier meets Anke and Christian before the roxi course; Mario, Marie
and Konrad can’t come to a meeting with Mrs. Meier in advance and Anna is already known out of the working
context
About working with Anna she knows the following: Anna is 28 years old and is working as a research assistant at
the University at the Chair of Economic and Business Education since 1,5 years. She is writing her PhD in the
field of entrepreneurial intentions of students in vocational education. After finishing high school Anna worked as
a social insurance clerk. Although Anna is working in Rostock she is living in Berlin in a common law marriage. In
her spare time she is a frequent runner. Her business idea is a floating shower in Berlin’s parks for runners.
Anke is 24 years old and just finished her studies in social pedagogic in Cologne. Currently she is jobless and
living at her parents’ place nearby Rostock. In her spare time Anke is acting on an “open-stage” for amateurs.
Due to her professional situation her father is pushing her to do something. He is a friend of Mr. Bunge, who
recommended the roxi course to Anke. After contacting the roxi office she met Mrs. Meier. During the interview
Mrs. Meier had the impression that Anke is a creative person with a lot of curious ideas, e.g. holding humorous
funeral eulogies or laughing therapy.
Christian was sent by the labour office to the roxi course. He is 35 years old, living in a common law marriage
with one child in the city of Demmin (approx. 70 km distance from Rostock) and is currently unemployed. The
labour office provided him with a vocational retraining as a system administrator. Furthermore, it will provide
financial support for his start-up after finishing this entrepreneurship-course and having worked out a business
plan. His idea is to start up a business as a mobile system administrator, serving the customer on the spot.
Development of
Entrepreneurial
Competencies
Matching the
would-be
entrepreneur
and the
business project
Formulation of
the Business
plan
Presentation of
the Business
plan
77
1
st
day – Introducing each other
In each roxi-course Mrs. Meier is using the first day to gather more information about the participants and to
introduce them to each other. Their task is to create a collage made out of old newspapers and magazines
through which the participants have to explain their private and professional background, their current situation
and their life-visions.
Finishing the collages Marie is the first who wants to present her results. Marie is 25 years old and still studying to
become a teacher for English and German language. While studying she is working as a bar tender at a club in
Rostock in the evenings. During the days she is exercising a lot in the sport studio. Her project idea is to provide
small and medium sized companies with English courses on the spot. It appears that Marie has strong
communication skills.
Based on the collages Mrs. Meier receives the following information about Konrad: He is 27 years old and
finished studying Informatics and Digital Media at the University for Applied Science in Brandenburg two years
ago. During his studies he worked for example for the company Tele-Factory in Potsdam-Babelsberg (located
close to the city of Berlin, approx. 250 km distance from Rostock) where he was responsible for setting up a DVD
department. Furthermore, Konrad and his business partner convinced the board of the Bechstein Company
(piano-maker) to produce an advertisement DVD. This special project, with a duration of more then one year, was
very successful and Konrad and his colleague Stephan started an own company “muxlab”. Together with Mario
he wants to start a business in the field of IT-training.
Konrad and Mario are good friends who grew up together in Havelberg a small city close to Berlin. Mario had to
leave University recently as he didn’t pass an examination. In the presentation he mainly leaves the impression
that he is kind of disoriented and lacking a clear vision for the start-up company, while Konrad explicitly
expressed his visions and ideas. Most of Konrad’s ideas have already been implemented although they are still in
their starting phases. So in general it has to be mentioned that Konrad is involved in several other projects during
the whole training. Furthermore, it appeared that Mario possesses the licence to work as a trainer for autogenic
training, without actively practicing it.
The collages of the other participants reflect and support Mrs. Meier’s impression about the respective person.
As usual Mrs. Meier is finishing the day with an introduction into “How to write a business plan”. She is providing
the participants with a fact sheet which contains the main structure for writing a business plan and is explaining
the single steps: business idea, marketing, production, organisation and management, financing. During the
whole course the business plan accompanies the participants. Following the single tasks and sessions each day,
time is given to them to work out their business plan.
2
nd
day – Getting to know about general entrepreneurial competencies
Regarding Mrs. Meier’s experience some of the participants usually lack knowledge about the tasks, challenges
and even risks of entrepreneurs due to missing contacts with people who have already started a business. To
provide the participants with an idea about this “mysterious” group of people entrepreneurs, she shows a short-
movie about entrepreneurial competencies and success cases. Within the movie the participants learn, how
experienced entrepreneurs handle challenges and accept defeats. Other points stressed are the combination of
private and professional life, dealing with doubts as well as with the constant search for new ideas. Following this,
their task is to select the entrepreneurial competencies from the people they “meet” in the movie – generalise
entrepreneurial behaviour and special characteristics of entrepreneurs.
Finishing the movie session Mrs. Meier is introducing the Johari Window method (see “Supporting Material II”) to
the participants. They are asked to evaluate their own individual behaviour with this method. The method’s aims
are twofold. On the one hand it can support the interpersonal relationship between the group members through
introducing feed-back rules etc. On the other hand it provides self-disclosure for the single person. Group
members can react very different on this method; while some are reticent others are open and curious. Anna and
Marie asked very inquisitively how the method is working and what the expected results are. The male
participants seem to be less interested and offended by it.
78
Part of the task is a reflection of the self-evaluation by the group including an external evaluation through its
members. Mrs. Meier is providing all participants with a working paper that shows the figure of the Johari Window
but not as usual with the original 55 adjectives. To ease the task, own adjectives could be used by the
participants instead of using the standard words. For some of the participants the gap between self and external
evaluation is very surprising and in some cases even hard to accept.
The roxi-participants usually spent their lunch breaks together in the nearby student cafeteria – sometimes with
the trainers, sometimes without. Their talks during the breaks are mainly dominated by discussions about their
business ideas and possible problems they might face. During these breaks a grouping becomes visible. While
Konrad and Mario are pretty often together; Christian is more reserved. Anna and Anke giggle a lot. Very seldom
Marie is joining the group because she is using the breaks to organise other things.
After the lunch break Mrs. Meier is introducing the action learning game “Ball fabric”
6
(see Appendix 1) to
stimulate the personal creativity and innovation competencies. The “Ball fabric” is one method from the action
learning approach. Therefore she is asking the participants to form a circle. In doing so the participants simulate a
production chain in which everybody is providing service to produce “something”. The product is represented by
the ball. The game starts with one ball. The participation of everybody is necessary for the “production process”
which is represented by handing over the ball to the other group members. The “production process” is completed
when the ball is back to the beginning of the chain. While doing so Mrs. Meier is taking the time and counting the
mistakes (dropping the ball). The results are visualised on a flip chart. In the next stage two more balls are used
and the task is to do the same process in a more efficient time frame and to minimize the failure rate to zero.
The trainer is pushing the group more and more to stimulate innovations and support creative thinking. So in
general the trainer (Mrs. Meier) is taking the role of a “competitor”, through putting pressure on the entrepreneurs.
This pressure leads to a situation which forces the young entrepreneurs to think innovatively and figure out new
ideas. The game’s main issue is to show the participants how to handle a situation where pressure is put on them
from outside and still being open for innovations.
The most innovative idea for transporting the ball and reducing the failure rate gave Konrad. He suggested that all
participants form a very close circle so that just one person is holding the ball in the middle of the circle and
everybody is touching it. However, due to this the failure rate can be reduced to zero and the least time is
needed.
Finishing the game Mrs. Meier is discussing the question: What has to be done by an entrepreneur to assure and
promote improvement and progress? Putting the focus on the games evaluation the appraisal of this game
usually takes twice as long as the game itself. It stresses the importance of innovation and external impulses to
stay competitive.
3
rd
day – Evaluation of one’s own entrepreneurial competencies
On the next day Mrs. Meier is providing the participants with the Personal Entrepreneurial Competencies –
Questionnaire (see “Supporting Material III”). The questionnaire contains 55 items which have to be ranked on a
scale from 1 (never) to 5 (always). Summarizing these items to 10 competency categories the participants finally
receive an overview about their entrepreneurial competencies which they already posses at the beginning of the
training.
Finishing this questionnaire the participants spent the afternoon with information seeking via internet or personal
and telephone interviews.
6
The game „Ball fabric“ is one example for the action-learning approach. Instead of listening, the participants are actively
involved.
79
4
th
day – Business idea generation and evaluation
Mr. Bunge has been invited by Mrs. Meier for another session regarding the topic - idea generation and
evaluation. This topic includes the following: overview of creativity techniques, e.g. brainstorming, idea screening
and SWOT-analysis.
To warm up the participants, Mr. Bunge as usual starts with a SWOT-analysis of each business idea. Therefore
the participants are asked to use the SWOT-table and to evaluate their own ideas regarding its strengths;
weaknesses; opportunities and threats (see “Supporting Material IV”).
Following Mr. Bunge is introducing different methods to generate new ideas. For some of the participants it
seems to be very difficult to make use of these methods and to get acquainted with new ideas; e.g. Christian. He
is very focused on his idea and doesn’t want to “waste” his time with finding new ones. Anna is very innovative
and immediately creates 20 new ideas. Meanwhile it became visible that Konrad and Mario are not convinced
anymore about starting a business together. But instead of being even more creative and looking for new ideas
for themselves, Konrad stays with his idea and doesn’t want to change it and Mario is absolutely discouraged.
Their task is to find 50 new ideas in the first step, which is impossible for all of them immediately. Due to this Mr.
Bunge is always asking the group to generate new ideas for each member. This process is supporting the group
dynamics and opens the participants’ mind for new ideas. Usually roxi participants really enjoy this task because
funny and absurd ideas are generated which would have never been contemplated by the single person (see
“Supporting Material V”).
In a second step the ideas have to be evaluated by the participants regarding their feasibility. A selection out of
the 50 ideas has to be undertaken and evaluated regarding the questionnaires. The questionnaires are designed
in such a way that they are connecting the new idea with the persons’ strengths and weaknesses and the market
potential (see “Supporting Material III”).
The results show that Anna’s idea doesn’t fit to her competencies but some new generated ideas are much more
suitable for her. Marie’s idea seems to fit to her but she recognizes that too many competitors are on the market
that could hamper the market entry. Due to her “strange” ideas it is almost impossible for Anke to evaluate the
market potential of her ideas, e.g. the demand and existing networks.
In the evening Mr. Bunge is meeting Mrs. Meier to give her the results of the day. She is very amazed about
them, especially regarding the results for Anna. On the next day she is talking with each participant about it. In
Anna’s case she agrees to the fact that Anna is lacking the necessary competencies to realise her idea but
because Anna is brimming over for enthusiasm for it, Mrs. Meier is encouraging Anna in her idea.
5. Further Reading
Action Learning Method
• Marquardt, M.J. (1999). Action learning in action. Palo Alto, CA: Davies-Black.
• Pedler, M. (1991). Action learning in action. Palo Alto, CA: Davies-Black.
• Raelin, J.A. (2000). Work-based learning. The new frontier of management development. Reading, MA:
Addison-Wesley.
• Reichert, A. (2006). The trainer in Entrepreneurship Education. In: Braun, G. / Diensberg, Ch. / Kadler, S. /
Reichert, A. / Wilde, K. Entrepreneurship Education – Challenge for Universities in the 21
st
century. Rostock
Working Papers on Economic and Human Resource Development. No. 25. Rostock. p 97 – 140.
• Revans, R. (1980). Action Learning: New techniques for management. Blond & Briggs, Ltd., London.
• Wilde, K. (2006). Constructivist Curriculum for Would-Be-Entrepreneurs’ Training. In: Braun, G. / Diensberg,
Ch. / Kadler, S. / Reichert, A. / Wilde, K. Entrepreneurship Education – Challenge for Universities in the 21
st
80
century. Rostock Working Papers on Economic and Human Resource Development. No. 25. Rostock. p 63-
96.
Task 2
• Brandstätter, H. (1997). Becoming an entrepreneur – a question of personality structure? In: Journal of
Economic Psychology. p. 172.
• Brockhaus, R.H. / Horwitz, Pamela (1987). Psychology of Entrepreneur. In : Sexton, D.L. / Smilar, R. (eds).
The Art and Science of Entrepreneurship. Cambridge, Ballinger, Mass. Publishing Company. p 25-48.
• Commission of the European Communities (2003). Green Paper: Entrepreneurship in Europe.http://ec.europa.eu/enterprise/entrepreneurship/green_paper/green_paper_final_en.pdf
Task 3
• Beck, Charles E. (1994). Perspectives on the Self in Communication: The Cognition Continuum and the
Johari Window (Theory and the Profession). In: Technical Communication: Journal of the Society for
Technical Communication. November 1994. p 753-56.
• Perreault, Gerri (2002). Self-Knowledge and Leadership: The Johari Window. In: Campus Activities
Programming. October 2002. p 64-66.
• Shirland, Larry / Polczynski, James J. (1984). Dynamic management communication exchange: A
mathematical model of information flow through the Johari Window. In: Journal of management studies. p 21-
27.
Task 4
• Levy, M. / Delahoussaye, M. (2000). Reg Revans: A Man of Action. Training Journal.
• Revans, R. W. (1979). Action Learning. Blond and Briggs. London.
• Revans, R. (1998). ABC of action learning: Empowering managers to act und to learn from action. London:
Lemos & Crane.
Task 5
• CEFE – International (1998). CEFE-Manual for Trainers. Part IV – Exercises 3.2.2.
• www.cefe.net
Task 6
• Dimo Dimov (2007). Idea generation from a creativity perspective. In: Entrepreneurship; Vol. 2: Process -
Westport, Conn. [u.a.] : Praeger, . - 2007, p 19-41.
Task 7
• CEFE – International (1998). CEFE-Manual for Trainers. Part IV – Exercises 4.2.3.
• www.cefe.net
81
6. References
• Sexton, Donald L. / Landström, H. (ed.) (2000). The Blackwell handbook of entrepreneurship. In conjunction
with the School of Business and Entrepreneurship at Nova Southeastern University. Malden, MA. Blackwell
Business [u.a.].
• Blenker, P., Dreisler, P. & Kjeldsen, J: Entrepreneurship Education –the new Challenge Facing the Universities,
Aarhus Business School, Working Paper 2006-02, March 2006
• Edelson, P. J.: Enhancing creativity in adult and continuing education: innovative approaches, methods, and
ideas, San Francisco : Jossey-Bass, 1999
• Gibb, Allan: Towards the Entrepreneurial University, ncge policy paper 003, May 2005, to be downloaded via:http://ww.ncge.org.uk/downloads/policy/Towards_the_Entrepreneurial_University.pdf
• Kirby, David A.: Entrepreneurship, McGraw-Hill Education, 2003
• Kolb, D.A.: Experimental Learning, San Francisco, 1984
• Reichert, A. (2006). The trainer in Entrepreneurship Education. In: Braun, G. / Diensberg, Ch. / Kadler, S. /
Reichert, A. / Wilde, K. Entrepreneurship Education – Challenge for Universities in the 21
st
century. Rostock
Working Papers on Economic and Human Resource Development. No. 25. Rostock. p 97 – 140.
• Shirland, Larry / Polczynski, James J. (1984). Dynamic management communication exchange: A
mathematical model of information flow through the Johari Window. In: Journal of management studies. p. 21-
27
• Sonnentag, S., Niessen, C. & Ohly, S.: Learning at Work: Training and Development, in: L. Cooper & I.T.
Robertson (Eds.): International Review of Industrial an Organizational Psychology 2004, pp 249-289,
Chichester, England: Wiley, 2004
• Sternberg, R. J.: Handbook of creativity. Cambridge Univ. Press, 1999
• Takeuchi, H. and Nonoka, J.: Hitotsubashi on Knowledge Management, Singapore: John Wiley & Sons, 2004
• Wilde, K. (2006). Constructivist Curriculum for Would-Be-Entrepreneurs’ Training. In: Braun, G. / Diensberg,
Ch. / Kadler, S. / Reichert, A. / Wilde, K. Entrepreneurship Education – Challenge for Universities in the 21
st
century. Rostock Working Papers on Economic and Human Resource Development. No. 25. Rostock. p 63-96.
7. Task
1 Describe the course atmosphere and the participants’ situation. Which problems might arise?
2 Use the attached table to derive the single participant’s strengths and weaknesses. Develop an
entrepreneurial perspective for each participant based on this table (advantages of being an Entrepreneur).
3 Test the Johari-Window on yourself and pay special attention to method-specific problems. In a next step
write a comprehensive teaching plan for introducing the Johari Window method.
4 Select two more action-learning methods and develop for each a short teaching note.
5 Make a competency analysis for yourself using the PEC-questionnaire. Develop a teaching plan to lead the
participants through this task.
6 Select 5 creativity methods for idea generation you would suggest to the participants. Explain your choice.
Explain how you would introduce these methods to the participants.
7 Different ways exist to asses the person and the ideas – the evaluation of the idea based on SWOT, the
evaluation of the idea regarding the person, the idea evaluation regarding the market evaluation. Develop a
grid with different criteria and a rating system through which the participants can evaluate their ideas.
8 Which outcomes of the idea-person-comparison are possible? Develop different strategies to cope with these
situations. Please take into consideration that at the end of your course each participant should have just one
concrete business idea.
82
Supporting Material
Supporting Material I Participants’ overview
Supporting Material II Johari Window
Supporting Material III PECS questionnaire
Supporting Material IV SWOT Analysis
Supporting Material V Alternative Business Ideas
83
Supporting Material I
Participants’ overview
84
Participant 1 Participant 2 Participant 3 Participant 4 Participant 5 Participant 6
Age
Gender
Family status
Vocational
Education
University
Education
Employment
status
Strengths
Weaknesses
Interests
Business Idea
85
Source: Shirland, Larry / Polczynski, James J. (1984). Dynamic management communication exchange: A mathematical model of
information flow through the Johari Window. In: Journal of management studies. p. 21-27.
Supporting Material II
Johari Window
86
Johari Window
Known to Self Not known to Self
Known to
Group
I
Arena
II
Blind
Not known to
group
III
Facade
IV
Unknown
Additional Explanations:
Pane I (Arena): Contains information that is known to both the individual and the group and is characterised by on
open exchange of information. The size of this pane increases as feedback occurs and information is released
from other panes.
Pane II (Blind): Contains information known to the group but not to Self. The size of this pane is an indication of
the degree that feedback is given or accepted.
Pane III (Facade): Contains information that is being withheld from the group. As trust develops, information will
flow from this pane to the Arena.
Pane IV (Unknown): Contains information unknown to both, the individual and the group. Through the feedback
process some of this information will transfer to the Facade and Blind areas as some things become known to the
individual while others become known to the group.
87
Source: CEFE – International (1998). CEFE-Manual for Trainers.
Supporting Material III
PECs Questionnaire
88
PECs self-rating questionnaire
INSTRUCTIONS
I. This questionnaire contains 55 sentences. Read each one and decide which describes you better. Be honest
to yourself! The questionnaire’s purpose is to help you to make a self-evaluation; it is no test and there is no
correct/wrong answer.
II. Choose the number associated to the sentence that best describes your behaviour:
1. never
2. seldom
3. sometimes
4. most of the times
5. always
III. Write down the chosen number beside each sentence.
See example:
No. Item Assessment
1. I keep myself calm in tense situations. 2
The person considered feels that the situation above seldom describes his/her behaviour; therefore he/she writes
the number 2 beside the sentence.
No. Item Assessment
1. I look for things that need to be done.
2. When I face a problem, I spend a lot of time trying to find a solution.
3. I do things before they become urgent.
4. I get upset when things are not done well.
5. I prefer situations in which I can control the results.
6. I like thinking about the future.
7. When I start a work or a project, I gather all possible information available.
8. I plan a big job by dividing it into several small tasks.
9. I get support by others for my suggestions.
10. I feel I will be succeeded in any activity I engage.
11. I listen carefully to any person who talks to me.
12 I do things that have to be done before others ask me to do so.
13. I insist several times to get someone to do what I want.
14. I keep my promises.
15. My results at work are better than those from people who work with me.
16. I don’t try new things without making sure I will succeed.
17. It’s a waste of time to think about what to do with one’s life.
18. I search for advice from people who know about the different aspects of my
business.
19. I carefully analyse the advantages and disadvantages of the several ways to
execute tasks.
20. I don’t spent a lot of time thinking how to influence other people’s ideas.
21. I change my way of thinking if other people strongly disagree with my point of
view.
22. I get upset, when I don’t do what I want.
23. I like challenges and new opportunities.
24. When something hinders what I am trying to do, I try to find other ways to
89
No. Item Assessment
accomplish my task.
25. I like to do other people’s work when it is necessary to accomplish a task in
time.
26. I get upset when I waste time.
27. I calculate the risk before get started.
28. The more I can express my expectations the sooner I will achieve it.
29. I often do things without looking for information concerning the task.
30. I try to anticipate all the problems that might happen and think of what can be
done in case any of them take place.
31. I seek important people to help me reach my goals.
32. When I try something difficult or something that challenges me, I feel confident
I will succeed.
33. I have failed in the past
34. I prefer to accomplish tasks that I dominate and feel safe doing.
35. When I face a great difficulty, I look for other tasks.
36. When I am doing something for another person, I make a lot of efforts so
he/she is very satisfied with my work.
37. I am never fully satisfied with the way things are done, I always think it could
be done better.
38. I do risky things.
39. I have a clear vision of where I intend to get in the future.
40. When I have to do a job for someone, I ask many questions to be sure that I
understood what he/she wants.
41. I face problems when they appear instead of anticipating them.
42. When trying to reach my goals, I look for solutions that would be positive for all
people involved.
43. I am doing a good job.
44. There have been times when I took advantage of people.
45. I try to find new tasks, different from the ones I have already done.
46. I try several ways to overcome the obstacles that disturb the accomplishment
of my goals.
47. I don’t let my work interfere with my personal life.
48. I can’t find ways of doing things faster.
49. I do things other people judge as risky.
50. Achieving my weekly goals is as much as important as achieving my annual
goals.
51. I look for different sources of information that could help me in my tasks and
projects.
52. If a way of solving a problem doesn’t work out, I try another.
53. I can change people’s opinion even with strongest points of view.
54. I stick to my decisions, even when other people strongly disagree with me.
55. I have no problems to recognize something I do not know.
90
INSTRUCTIONS SCORE SHEET
I. Write down the answer for each sentence on the lines above the correspondent number of the statement.
Note that the numbers of the statements are serial in each column.
II. Make the calculation indicated in each line to compute the points for each characteristic.
III. Sum up all the points obtained for each characteristic to obtain the total score.
Rating for the statements Score PEC
+ + - + + 6 =
(1) (12) (23) (34) (45)
_______
Searches for possibilities
+ + - + + 6 =
(2) (13) (24) (35) (46)
_______
Is perseverant
+ + + - + 6 =
(3) (14) (25) (36) (47)
_______
Knows the importance of
fulfilling tasks
+ + + - + 6 =
(4) (15) (26) (37) (48)
_______
Is aware of opportunities and
takes advantages of them
- + + + + 6 =
(5) (16) (27) (38) (49)
_______
Is risk-oriented
- + + + + 6 =
(6) (17) (28) (39) (50)
_______
Is objective-oriented
+ + + + + 6 =
(7) (18) (29) (40) (51)
_______
Searches for information
+ + - + + 6 =
(8) (19) (30) (41) (52)
_______
Makes systematic
planning and monitoring
- + + + + 6 =
(9) (20) (31) (42) (53)
_______
Is persuasive and aware of
the importance of networking
- + + + + 6 =
(10) (21) (32) (43) (54)
_______
Is self-confident
- - - + +
18 =
(11) (22) (33) (44) (55)
_______
Correction Factor
FINAL SCORE = _______________ (Entrepreneurial Profile)
91
EXCURS:
CORRECTION FACTOR FOR SELF-ASSESSMENT
I. The correction factor is used to evaluate whether someone is trying to
portray oneself to positive. When this factor scores 20 or more, the
evaluation of the entrepreneurial profile has to be corrected.
II. Use the following figures to correct the assessment.
If the correction factor scores:
Reduce each PEC score by:
24 or 25 7
22 or 23 5
20 or 21 3
19 or less 0
III. Use the following table for the corrected scores:
Profile Original score Correcting figures Corrected score
Searches for
possibilities
Is perseverant
Knows the
importance of
fulfilling tasks
Is aware of
opportunities and
takes advantages
of them
Is risk-oriented
Is objective-
oriented
Searches for
information
Makes systematic
planning and
monitoring
Is persuasive and
aware of the
importance of
networking
Is self-confident
92
PECS Self-Rating Questionnaire - Results
Profile Score
0 5 10 15 20 25
Searches for
possibilities
Is perseverant
Knows the
importance of
fulfilling tasks
Is aware of
opportunities and
takes advantages
of them
Is risk-oriented
Is objective-
oriented
Searches for
information
Makes systematic
planning and
monitoring
Is persuasive and
aware of the
importance of
networking
Is self-confident
0 5 10 15 20 25
93
Source: CEFE – International (1998). CEFE-Manual for Trainers.
Supporting Material IV
SWOT Analysis
94
SWOT Analysis of the business idea
positive factors negative factors
in the present
Strengths Weaknesses
INTERN
Technical expertise
Good network with customers
Managerial experience
Distribution system
Superior technology
No control over raw material
Limited product life
Poor design of products
Weak selling efforts
Comparatively high price
Lack of working capital
INTERN
Opportunities Threats
EXTERN
Few and weak competitors
Rising income of target market
Growing demand
Low interest in loan
Favourable government policy
Natural disaster
Raw materials shortage
Graft and corruption
Too much competition
Poor infrastructure
EXTERN
in the future
positive factors negative factors
Selection of the idea regarding the person
Idea evaluation Original idea Idea No. 2 Idea No. 3 ...
(+) Is motivating me.
(+) Reduces the relevance of my weaknesses.
(+) Based on my strengths.
(+) …
(+) …
(+) …
(+) …
(+) …
(+) …
(+) …
total
Within the control of the entrepreneur
Beyond the control of the entrepreneur
I fully agree: 5
I agree: 3
I am ambiguous: 0
I partially don’t agree: -3
I disagree: -5
95
Selection of the idea regarding the market evaluation
Idea evaluation Original idea Idea No. 2 Idea No. 3 ...
(+) Solvent demand
(+) Availability of qualified personnel
(+) …
(+) …
(+) …
(=) total
(-) Competitors
(=) Corrected Total
total
very high: 5
high: 4
moderate: 3
low: 2
imperceptible: 1
absent: 0
Competitors: 5 for many competitors, 0 for none
deduct from the total so far
96
Supporting Material V
Alternative Business Ideas
97
Alternative business ideas
The following list contains alternative business ideas for Anna.
Non-cursive lines are Anna’s ideas; cursive-lines are ideas collected by other group members.
1 Inline-Skater map 26 Event organisation
2 Internet platform for alibis 27 Holding speeches
3 Restaurant reviewer 28 Broker
4 Chocolate shop 29 Pilot
5 Personal Shopping guide for Berlin 30 Astronaut
6 Baking cakes for cafes 31 Deep sea researcher
7 Opening a Starbucks shop 32 Travel tester
8 Trend scout 33 Apartment tester
9 International expert for empirical studies 34 Service tester
10 Tester for running tracks 35 Personal trainer
11
Develop “games” for economic and business
lessons
36 Stuntwoman
12 Test driver for cars 37 Foreign correspondent
13 Organising single events 38 Detective
14 Organising Christmas parties 39 Race driver
15 Writing scripts for crime movies 40 Fidelity tester
16 Opening a health-food shop in a small city 41 ?
17 Taxi driver 42 ?
18
Correcting students’ seminar papers and degree
dissertations
43 ?
19
Designing plastic bags for dog excrements with
advertisement
44 ?
20 Friends rental service 45 ?
21 Face-Model 46 ?
22 Journalist 47 ?
23 Running trainer 48 ?
24 Politician 49 ?
25 Travel courier 50 ?
98
Appendix
„Ball Fabric“
First round
the group is forming a circle
the ball is given from one
participant to the other
First innovation
the group is moving closer
together
the participants gathered the
three balls in a box and
everybody is touching the box
Documentation
evaluation of time and failure
rate
reflection of the innovation
process
99
Importance of the Programme of
Entrepreneurship Training and Motivation
for Young Innovative Companies:
KTC Case
Assoc. Prof. Dr. Rimantas Venskus
Kaunas University of Technology, Personnel training centre
KTU Regional Science Park, Lihuania, Kaunas K.Petrausko str. 26, www.ktc.lt
Phone: +370 37 333040
Fax: +370 37 333323
Dr. Pranas Milius ([email protected]), Jurgita Sarkiene ([email protected])
KTC Case
Keywords:
entrepreneurship training, entrepreneurship motivation, entrepreneurship promotion, innovation
development, science and technology park, business incubator.
Abstract
The cumulated experience of knowledge-economy development shows that entrepreneurship training
and motivation is a very efficient and perspective organisational form, designed for the development of
high-tech industry as well as acceleration of implementation of innovations. Science and technology
parks as well as business incubators are considered to be one of organisational forms intended for
training small and medium business companies of innovations and entrepreneurship.
This work includes a short description on the history of activity of KTU Regional Science Park as well as
the experience of training entrepreneurship in Kaunas Region among novice businessmen. Summaries
of currently used programmes of entrepreneurship motivation and training are presented. Additional
initiatives that can help to more efficiently organise motivation and training of entrepreneurship as well
as processes of entrepreneurship development in the activities of science parks are discussed. This is
done with regard to the processes organisation of innovative business, purposeful investment and
constant training/learning.
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1. Background
Promotion of enterprise is one the principal goals of economical growth, as the main tasks of the
development of the country – training of human resources, encouragement of scientific and
technological advancement as well as innovations and intellectualisation, expedition of the GDP and
reduction of social-economical exclusion among regions. All this can be achieved by being engaged in
the intense development of a network of small and medium business (SMB). The development of SMB
is inseparable from commercialisation of innovations, cooperation between small and large companies
as well as science and business, effective infrastructure of business promotion, which influence
economy and scientific development of the entire country.
The primary conditions of the SMB development, as well as enterprise, – knowledge, financial
resources and appropriate environment, which would initiate the growth and development of
companies. If knowledge is concerned, the emphasis should be put onto the spread of information on
business and access of training and consulting services. With the aim to improve the financial muscle
of the SMB subjects, am important role should be played by a well-organised and essential financial
state support. Improvement of environment – it is primarily improvement of legal and economical
environment of the SMB, considering the experience of European countries. Realisation of the three
distinguished essential conditions in order to achieve all the mentioned goals, form the essence of the
SMB strategic development (12).
Today the development and training of enterprise, or now newly called entrepreneurship have become
the priority of national innovation policy.
What are the innovations to induce entrepreneurship in the country and are they sufficient? What extra
efforts are needed to correctly organise processes of entrepreneurship training? These are relevant
questions often raising discussions in the layers of government, academic community and the society,
though not always they are given answers.
The purpose of this work – to emphasise conditions and problems of establishment, growth and
development of innovative SMB companies, considering the experience of KTU regional science park
activity, programmes that are currently being implemented as well as future perspectives; also to
discuss programmes to motivate and train entrepreneurship that are practically applied by the science
park to innovative companies of Kaunas Region.
1.1. Establishment of Promotion Structures for SMB Companies in
Lithuania
The small and medium business (SMB) in Lithuania, EU countries and other countries occupy almost
99 percent of all registered companies. Therefore, special attention from the state and promotion,
coming in the norms of competition, have a very solid weigh in expanding and strengthening SMB,
which always remains innovation-intensive and easily conforms to market changes.
There exist various promotion structures for SMB in the world. One of them is so called business
incubators (BI) that have recently spread in a number of countries; they are also called
technology/innovation centres (13).
Business incubators in developed countries come to the help for business beginners or start-ups.
Business incubators have proved their ability to help solve their problems by reducing the risk of activity
and failure of newly-established and growing companies. The concept of business incubators is rather
flexible in order to adjust to different requirements and environments. In industrial countries business
incubators started operating by promoting new technological companies. A classic business formula
starts from the initial capital, however in Lithuania it is blocked at the very beginning of a cycle: the very
idea of business establishment or development appears at the dead-point possessing no rooms,
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finances, informational background, experienced specialists and consultants, etc. Here comes again
business incubator ready to solve these problems. The purpose of a business incubator – help
establish scientific innovations as well as promote small and medium business. Here business starters
receive rooms, technical and administrative services.
The principal task of a developing country is general promotion of enterprise. As long as the main
structure of companies to function is developed, thus the basis is given for high-technology companies.
Incubators, as instruments of promotion of local economy development, have been spreading already
for several decades in the entire world. The USA is considered to be the motherland of business
incubators. In 1959, having lost their jobs in closed factories, workers started establishing small
companies. This kind of business later proved to be very successful – new workplaces were created
and occupation of residents was increasing. Business incubators are mediums for scientists’
innovations to pass into industry where they are commercialised. Therefore the USA government was
encouraging the development of this idea in the entire country. Thus, in 1959 the first business
incubator appeared in the USA.
Pioneers of European business incubators, the activity of which is based on the concept of science
parks and focuses on the promotion of new technological companies, are Heriot-Watt University in
Edinburgh (started its activity in 1969) and Cambridge University. In 1983 the first business incubator of
Germany opened its doors in Berlin. In 1986 in Latin America the first project was implemented, after
which in 1990, similar projects followed in Eastern and Central Europe after some political changes,
which allowed some possibilities for private business. At the same time business incubators started
working in Africa. Although there are huge differences among projects taken separately from seven
continents, they are united by a common goal – the promotion for start-ups.
Currently there is a great deal of such structures in the entire world: there are around 1,000 of them in
Europe. BIs become popular for they provide rooms for companies applying a flexible rent system,
enable cooperation or common use of the office or business administration services. Business
incubators mediate in order to get financial support to pay for these services.
Mid-1990s is considered to be the coming of BI in Lithuania, when the Innovation Centre of Kaunas
University of Technology, led by Dr. P. B. Milius, started upholding the idea and prepared a project of
Business incubator.
Considering the fact, that the aim of a business incubator is not to make profit but to offer help to newly
established companies, an incubator could be founded only following one law, which regulates the
establishment and activity of non-profit-making organisations. To this end, Ministry of Economy of the
Republic of Lithuania together with the Lithuanian Development Agency for Small and Medium-Sized
Enterprises prepared a model project of regulations for a public institution – Business incubator. What
is more, Ministry of Economy, considering the significance of this project to the development of the
state economy, became a founder of the first business incubator in Lithuania. Kaunas University of
Technology also supported the idea of establishment of such structure, in order scientific innovations
were actively applied in production. Thus, on June 11, 1998, after an agreement of establishment had
been signed, a public institution ‘KTU Regional Business Incubator’ was born. Kaunas University of
Technology provided the incubator with rooms in the students’ town, whereas Ministry of economy
assigned more than 2 million Lt. from the Small and Medium-Sized Business Promotion Fund for the
reconstruction of the rooms.
Currently Lithuania has 6 business incubators and 42 business information centres. Business
information centres (BIC) purvey information and consultations for businessmen and the ones willing to
start their own business. Staff of business centres provides consultations on establishment of
companies, start-up, bookkeeping, and other issues of business management. Besides, business
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centres organise seminars, trainings and events on business spread raising relevant topics for
businessmen. The majority of BIC services are free of charge or on easy terms.
Business information centres and business incubators are part of the network of institutions for
business services – a state established infrastructure for business promotion (picture 1), which would
aim at encouragement to establish and develop small and medium-sized companies as well as to
secure the access of qualitative business services provided on easy terms for businessmen of all
Lithuanian regions.
Picture 1. Network of institutions for business services in Lithuania
The results of activities of business incubators and business information centres in Lithuania show that
these structures induce country’s economical-innovative development. However, scientific and
intellectual resources of the region have a huge influence on the characteristics and results of their
activity. The BI in Šiauliai could be assigned to technologically oriented structures of SMB promotion;
BIs in other regions are basically concerned with problems of reduction of unemployment rates.
In Lithuania a business promotion infrastructure was established in the period of 1991 – 2004. This
period can be called the first stage of establishment of promotion structures for SMB companies
(business). We can have no doubt that due to this network of business promotion institutions the
problem of information shortage on start-up, management, funding, and development was solved.
2004 is considered to be beginning of the stage II of establishment of business promotion
structures, when the first structures of innovation implementation (often called ‘high-tech’ structures)
were established in Lithuania: science and technology parks (STP), innovation centres, technology
development agencies, and others (14).
The culture of science and technology parks in Lithuania started developing not long ago, although this
practice in the world has existed already for four decades. The fact that cooperation between science
and technologies was beneficial was primarily understood by the USA businessmen and scientists and
thus the first such park in the world was established in 1951 in Stanford, California State. With the help
of USA experience, STP came to Europe and other countries. Such model of business establishment
raised today well-known business giants, such as ‘Phillips’ or ‘Nokia’.
The first park in Lithuania was established only in 1993 (Public institution Science and Technology Park
in Vilnius). The second wave of establishment of science and technology parks started in 2002.
Currently in Lithuania there are 10 science and technology parks (2 are being established), which are
closely related with scientific institutions and public organisations, 2 innovation centres, Agency for
International Science and Technology Development Programmes in Lithuania (AISTDP) – these are
organisations which develop entrepreneurship, induce the expansion of innovation culture among
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scientists and businessmen, as well as they are mediums to encourage a closer cooperation between
science and business.
Companies that are engaged in performing applied researches as well as in doing other innovative
activities are established in science and technology parks (STP). STP offer special value added
services, such as business incubation, organisation of trainings, consultations, and transfer of
technologies. The principal aim of the regional STPs is to increase regional competitive ability, by
inducing culture of quality and innovations among local members, by organising transfer of knowledge
and technologies from their initial points to companies and market, also by being active in encouraging
establishment of new innovative companies.
Science and technology parks are one of the means to promote scientific researches and experimental
development, knowledge and receptive companies; also to commercialise results of researches
performed by scientific institutions.
Since we face a fast advancement of technologies, cooperation between businessmen and scientists
becomes inevitable. According to experts, such parks in Lithuania have potential not only to induce the
development of high-technology sector but also to increase competitive ability of industry and whole
economy. Besides, this will keep scientific potential and will improve culture of innovations. Lithuania is
not a country of minerals or industrial giants, so it is most beneficial to focus on inducement of
information technologies and science. Establishment and development of science and technology parks
was planned in a Long-term Strategy for Lithuanian Economic Development until 2015.
Innovation centres – not profit-making organisations, inducing innovative processes in Lithuania:
introduction of innovation in business, employment of new technologies and development of innovative
business. Innovation centres offer the following services: drawing up business plans and applications
for the EU structural funds, with the aim to implement innovative projects of companies; providing
consultations on these issues: development of national and EU promotion for innovations and business,
management of international projects, activity of companies, management of innovations, and transfer
of technologies; search for partners for common projects in business, scientific researches, and others
in Lithuania and abroad; organisation of conferences and seminars on innovation development.
The activity of science and technology parks (STP) located in Vilnius, Kaunas, Klaip?da, and Šiauliai
shows intensification of inducement of technical, technological and managerial innovations, and the
establishment of ‘spin-off’ firms, which allows hoping for perfection of unfinished scientific-exploratory
works (SEW), for the growth of interest from their authors in commercialisation of results, also for
promotion of entrepreneurship between businessmen and scientists as well as for training of
entrepreneurship. At the same time, in order to avoid the possible duplication of STP and BI activities
due to insufficient integration of these structures with scientific, training and productive structures, it is
necessary to strengthen the network of promotion for innovations/innovative entrepreneurship.
Non-financial support for innovations in Lithuania is received from state and public institutions, which
form the so called infrastructure of innovation promotion that would include the earlier-mentioned
innovation centres, science and technology parks, business incubators, business information centres,
agencies, and associative business organisations. The majority of these institutions are engaged in
implementation of innovation policy by offering special services for innovation promotion. Innovation
policy is formed and its implementation administered by Ministry of Economy, which is responsible for
innovations in business, and by Ministry of Education and Science, which is responsible for the growth
of innovation potential, development of scientific researches and partially for commercialisation of
scientific results.
During the second stage of the establishment of structures for business promotion, which continues
even today, training of entrepreneurship takes a special places. It can be maintained that it is
becoming a priority in Lithuania. Investments in education and science are growing rapidly, it is
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emphasised that a well-educated society is a guarantee of national stability; a successful economical
development determines the growth of life quality.
In order to create nuclei of science, studies and knowledge economy at international level in Lithuania,
to accelerate establishment of knowledge society and to strengthen competitive ability of Lithuania the
Government approved the concept of expansion of integrated centres (valleys) of science, studies and
business in March 2007.
The development of valleys shall be pursued using finances of the 2007-2013 European Union
structural promotion, of programmes of development of international scientific researches and
innovations, of state and municipal budgets, of participating institutions, and also of private business.
The concept of valley development has been framed as the basic element of reconstruction of
infrastructure of Lithuanian innovation system. It shall help to focus, integrate and renew the
already existing public potential of scientific researches, to enable a more effective interaction with
business and to strengthen its international competitive ability.
Places of concentration of perspective potential of scientific researches shall be identified in order to
induce effective work of valleys; territorially scattered scientific and study institutions shall be
transferred to valleys, and their concentration would create a value added, optimise their structure and
interaction, develop infrastructure, renew the equipment used for scientific researches and studies, set
up a modern base of scientific researches, create commercialisation centres, set up ‘spin-offs’ and
knowledge receptive business companies, and raise foreign investments targeted at science.
In the leading world countries a spontaneous establishment of integrated science, study and business
centres started in the sixth decade of the last century (famous Silicon Valley in the USA), and later, with
the single-minded support from various governments it spread in western Europe, Scandinavia, Japan;
currently it is spreading in China, in rising regions of the Far East and the world. The necessity of a
closer interaction between science, studies and business is also emphasised in Lithuanian long-term
strategic documents.
On October 29, 2007 a commission of integrated science, study and business centres (valleys) as well
as a united group of experts of the Science Council of Lithuania and the Lithuanian Academy of
Sciences met with the initiators of integrated science, study and business centres (valleys) who
presented their view on understanding of the so-called valleys. Visions of five valleys were introduced.
Together with the main initiators of business and science valleys – universities, business partners were
also present at the presentation of visions. According to business partners, expansion of valleys could
essentially contribute to the development of state economy, creation high technologies and
commercialisation of science results. Businessmen intend to contribute to the creation of valleys. These
common initiatives of science, studies and business will enable the Lithuanian science and study
system to single-mindedly use potential of science and studies, to renew the base of science and
studies and to apply science results to business.
The concept of integrated science, study and business centres (valleys) was approved by the
Government this spring, whereas Ministry of Education and Science and Ministry of Economy
were obliged to coordinate its implementation. On the basis of successfully functioning valleys not only
in the USA, but also in Europe, an assumption is made that the establishment of these new structures –
science valleys – in Lithuania shall induce development of innovative business and entrepreneurship
training in the country.
There is a sufficient scientific potential in Lithuania, and the country is capable of creating new
technologies and products of advanced level. According to the foreign experience, only after the main
structure of company functioning has been developed a basis for high-tech establishers is prepared.
The principal goal of Lithuania as a developing country is inducement of business development. That is
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why Kaunas University of Technology is active in solving a currently very relative problem of
development of technologically oriented small business.
Researches carried out among scientific, academic and business promotion institutions showed that
the aspects of Lithuanian scientific researches are not always related with business development and
demands; the system of science and studies still has a slow reaction towards the needs of state’s long-
term development, there is a shortage of highly qualified specialists who would meet the demands of
modern industry and business; higher schools and scientific research institutions have no interest in
creation of new innovative companies due to imperfect laws; there is a big demand for financial
resources and skilled workers; economical risk; long term to accept innovations; bureaucratic
mechanism of financing innovations; absence of bank warranties for innovations; a shortage of
specialised information; the smaller the company is and the bigger the innovation is the harder it is
implemented without an external support.
In order to solve the enumerated problems it is essential to unite initiatives of science and technology
parks and technological clusters with commercialisation of science results as well as formation of
culture of businessmen’s innovative entrepreneurship.
1.2. Initiatives and Programmes of Entrepreneurship Promotion in
Lithuania
Promotion of entrepreneurship is usually described as an interpretation and popularisation of business
processes, as well as a spread of business knowledge in the society by encouraging people to
establish private business.
Insufficient level of entrepreneurship in the society is one of the main problems of development of small
and medium sized business, covering inability of individuals or their unwillingness to begin private
business. Usually the lack of entrepreneurship is influenced by shortage of knowledge and
understanding about private business. The problem of shortage of entrepreneurship is felt in the entire
European Union and it is named as one of the principal reasons of EU economical backwardness from
the USA. Therefore, programmes of entrepreneurship promotion are an extremely popular and valuable
initiative, highly appreciable in political and business layers.
What President of European Committee Dimitris Dimitriadis emphasises in the summary of 2006–2008
programme presentation is that in order to overcome future challenges, entrepreneurship should be
induced in all layers of the society in all possible forms. Entrepreneurship is perceived in a broad sense;
this term means initiative, which is relevant for both young and older people, and covers economical,
scientific and civil activity. He claims that in the field of economy it is entrepreneurship that performs the
main role in order to overcome challenges of globalisation. Entrepreneurship cannot become merely a
simple task, for it must acquire a ‘human face’. The main goal is to preserve the European social model
which is valued in other countries of the world and develop it until it is capable of mastering threats
arising due to the world competition and demographic changes.
The level of entrepreneurship in Lithuania was in the process of fast rising up to 2001. Analysing the
change of SMB companies during the period of 2002 - 2005 it becomes clear, though marginally, that
there was a tendency of decrease of the number of start-ups (in 2001 there were 56,214 companies in
the country, in 2002 – 55,252 companies, in 2003 – 54,589, in 2004 – 55,846, and in 2005 – 56,428
companies). According to the data of the Department of Statistics under the Republic of Lithuania on
January 1, 2007 there were 59,712 small and medium sized companies in Lithuania (15).
Analysing the structure of operating SMB companies according to the kinds of economical activity of
2003–2006, the following points are noticed: fast growth of the construction sector, size stability of the
service sector, and decrease of the industrial and trade sector. The decrease of SMB companies was
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caused by the development of large shopping centres and the involved displacement of small
enterprises from the market (15).
Gross Domestic Product (GDP) is one of the essential ways of measuring the effectiveness of
economical activity of a country or a separate sector of economy. The rates of GDP growth indicate the
development of country’s economy. Lithuanian economical growth still remains one of the rapidest in
Europe – the 7.3% growth in GDP in 2004, 7.6% – in 2005, and 7.5% – in 2006 (15). The biggest
influence on such a rapid growth of economy in recent years was felt from bank credits extended on
favourable conditions, EU financial support, reduction of taxes and increase of wages, rising income of
residents and therefore increased consumption.
The part of SMB in the gross value added in 2004, as compared with 2003, increased by 0.5% and
formed 51.6%. The value of products and services created by SMB companies keeps growing every
year, which means that the role of SMB in Lithuanian economy is becoming more important (15).
Summarising the statistical data, it could be said that SMB companies constitute the largest and the
most dynamic group of companies, which creates 51.6% of the gross value added. Because of this
reason inducement of SMB companies is one of the most essential tasks of economy development, the
more especially as the principal goals of the state economy development are: to create new work
places, to strengthen the middle class, to speed up the growth of GDP, and to diminish social-
economical differences among regions. The mentioned above goals cannot be reached unless a
network of SMB companies is developed, or a favourable legal, economical and financial climate for
business development support is formed.
There has been a concern in recent years about insufficient attention paid to the development of
entrepreneurship in Lithuania. Entrepreneurship in the country is reflected by a number of business
owners for 1,000 residents of Lithuania which constitutes only 1.2 percent, whereas the average of the
European Union (EU) is more than 7 percent. These rates have placed Lithuania in the bottom of all EU
members.
Considering recommendations of the European Committee and experts as well as the present situation
in the country, new means of promotion of entrepreneurship are currently planned, which will be
financed from the state budget and the European Union Structural Funds – they are so called
science valleys, complex programmes, national science programmes, and highly advanced science
centres. The support will be available for lecturers and scientists, who are willing to improve their
academic and pedagogical competence, also for the most productive groups of scientists. In order to
achieve a better competitive ability of Lithuanian business, there is a need of extra initiatives, which
would induce business, especially small and medium; also it is necessary to establish more scientific
innovations, try to renew technologies, and make work places more effective (16). According to
members of the Confederation of Industrialists, the country must pursue an integral policy when
creating a better climate in the society, striving for intellectual nurturance (not only based on
entrepreneurship) just by teaching citizens of the country, but also by obviating obstacles for the
establishment of new enterprises. The experience of EU training of entrepreneurship as well as
formation of abilities purports that at a secondary school around 20 percent of students who participate
in the activity of ‘small enterprises’ establish their own companies after graduation.
Having estimated opinions and recommendations of experts several questions arise: what could
intensify efforts single-mindedly in this field alongside with currently applied programmes as well as
operating structures that induce entrepreneurship? What are the newest initiatives to induce
entrepreneurship which are applied practically?
National Programme of Promotion of Youth Entrepreneurship for 2007-2011 (hereinafter called –
Programme) was prepared by implementing the subsection 11.2 of the programme of means of
implementation for 2004-2008 of the Republic of Lithuania approved by a decree No. 315 by the
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Government of the Republic of Lithuania on March 24, 2005. The relevance of the programme is
grounded by legal acts and strategic documents of the European Union. Implementation of the
programme will contribute to realisation of our country’s principal strategic regulations of development –
especially in the field of education, economy, labour market, public services for business, also different
regions; upbringing of young generation should receive a lot of attention. Besides, a strategic basis to
solve problems of youth entrepreneurship has already been established. Another step that follows is to
secure its implementation.
With reference to factual data and the researches made in Lithuania, as well as to recommendations of
foreign countries, especially the European Union, and United to Nations Economic Commission for
Europe, also to the experience of the USA, Australia and Canada – countries with enormous practice of
entrepreneurship promotion for youth, the following three groups of reasons are distinguished:
1. Insufficient perception and knowledge of youth and the society about possibilities of one’s own
business;
2. A lack of appropriate assistance for youth to start and develop their own business;
3. Absence of coordination and supervision of state actions that induce entrepreneurship.
The emphasis in the programme is put on insufficient training of entrepreneurship in the system of
formal and informal education. The training of youth entrepreneurship is perceived as formation and
strengthening of entrepreneurship skills through institutions of both formal (university or higher
education, vocational training, general education) and informal (labour market vocational training,
courses, etc.) education.
Despite all efforts and strategic resolutions, training of entrepreneurship is insufficient. The survey of
university graduates has shown that they lack practical skills to start business (as indicated by 53.1
percent of respondents) and to draw up a business plan (40.9 percent). The lifelong learning strategy
maintains that comprehensive schools in Lithuania pay too small attention to train entrepreneurship
skills. More regard to this skill is paid at vocational and higher education schools – for their syllabi
include modules of entrepreneurship.
Researches of Ministry of Economy of the Republic of Lithuania show that representatives of small and
medium business do not perceive the lack of entrepreneurship knowledge as one of the principal
obstacles of business development. Banks indicate that the potential of crediting small and medium
business is used only in half. It is mostly because small businessmen are incapable of drawing up business
plans. A long-term strategy for Lithuanian Economic Development until 2015 maintains that, in spite of the
fact that the category of economically active residents with university and special secondary education
is increasing, a potential of the country’s entrepreneurship is not of the right level, and a part of
businessmen do not have an appropriate education as well as necessary experience. According to the
National Education Strategy the structure and content of education in Lithuania are not adapted to
occupation, which is proved by unemployment of youth and other age groups.
Ministry of Education and Science recommends comprehensive schools to have lessons of economy
as a compulsory subject in the 9-10 years of study, whereas in the 11-12 – as an elective one. From
1999 through 2003 the number of students of economy in the 9-12 year grew up rapidly – about 6
times. In 2003 the number of schools that had courses of economy was 68 percent from the total
number of survey participants, whereas in 2001 – 34 percent. According to the Strategy on Promoting
Economic Literacy and Entrepreneurship Education all schools in the European Union have a separate
subject on economy and almost in half of them it is compulsory. However, economy and
entrepreneurship training is not the same thing, and economy lessons at a comprehensive
school have little effect on the rise of entrepreneurship level. Meanwhile in the Lithuanian
educational system it is enough just to teach economy.
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Training of entrepreneurship at comprehensive schools is developed in accordance with the Strategy
on Promoting Economic Literacy and Entrepreneurship Education, where references to prepare
methods and means of training entrepreneurship were provided, as well as to raise teachers’
qualification. These are just general references though, and no particular means there have been
planned.
An appropriate initial assistance for youth to start business and develop it is rather important and
related with promotion for small and medium business, for companies established by young people are
often small or medium sized, and they have a right to an appropriate support. However, youth also
needs specific means since it does not have experience, start-up capital or a business idea. But no
adapted means for youth have so far been applied in Lithuania.
A great deal of researches to determine obstacles for a business start and development as well as the
quality of assistance have been carried out. A long-term strategy for Lithuanian Economic Development
until 2015 maintains that the development of business is impeded by heavy taxes, a lack of financial
resources for a start-up capital as well as business itself, insufficiently developed network of promotion
institutions, ineffective information and consultation of business, medium competence of businessmen,
too strict administrative and legal regulations, also insufficient links among companies, and uneven
business development in regions (17).
Today Lithuania has a promotion system of small and medium business, which could be considered an
example at coordinating actions of promotion of youth entrepreneurship.
This Lithuanian National Programme of Promotion of Youth Entrepreneurship for 2007-2012 as well as
a plan of means received much criticism from experts. Members of the Confederation of Industrialists
emphasise the fact that this programme almost ignores the newest EU directives and recommendations
issued from 2005 through 2007, which encourage active development of the culture of higher
entrepreneurship, creating a favourable academic environment in all levels of education. Also it defies
an encouragement to enable organisations with practical experience to contribute to the training
of entrepreneurship, to support their efforts in pursuing various programmes, to finance tentative
projects at schools, and to spread good practice.
In June 2004 Ministry of Education and Science of the Republic of Lithuania (MES/RL) approved
the Strategy on Promoting Economic Literacy and Entrepreneurship Education. It defines the
concept of entrepreneurship as a way of thinking, also as personal social, managerial and personal
competences which allow one’s knowledge to be applied in everyday life, i.e. particular abilities
enabling not only organisation of own business, but also take the risks for decisions made (18). The
aim of training of entrepreneurship is to train abilities of students. Entrepreneurship in educational
system is perceived in a broad sense and it is more highlighted as self-sufficiency, responsibility and
innovation in general.
As the strategy maintains, entrepreneurship is one of person’s competences which mostly serves for
personalisation of a human being, induces self-expression in everyday life. Entrepreneurship operates
only in activity. Thus, all the training of personality must be oriented towards a result – to nurture a
personality which is able to act independently and responsibly. A secure foundation of a business-
oriented viewpoint and entrepreneurship itself should be laid at primary, secondary and higher schools
(19).
There are initiatives in Lithuania to prepare modules of knowledge on business and entrepreneurship
and include them into syllabi of secondary, higher and university education. This is planned in
Lithuanian strategic documents – the long-term strategy for Lithuanian Development and strategic policies
of small and medium business development until 2008. Besides, Ministry of Education and Science has
implemented several projects related to application of entrepreneurship training into vocational preparation
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(finances of PHARE fund) as well as publishing of material on entrepreneurship training (a manual on
entrepreneurship basics has been published together with the British Council).
Entrepreneurship of Youth and Strategic Priorities of the Republic of Lithuania:
To strengthen the training of entrepreneurship of youth and aim at a larger number of people to
have conditions to start their own business as it is indicated in the Government programme of
2004-2008 (‘Valstyb?s Žinios’, 2004, No. 181-6703).
Strategic documents of the Republic of Lithuania highlight entrepreneurship as one of the
principal factors of a balanced growth of economy and regional development together with
knowledge, capital and labour force. This is stated in the vision of Lithuania of a long-term strategy
for the country’s development, and in the long-term strategy for Lithuanian economic development
until 2015.
In the field of education, the regulations of the state educational strategy for 2003-2012 intend to
sharpen attention to the encouragement of entrepreneurship in all levels of education. Besides, it is
necessary to train financial wisdom, form skills of entrepreneurship and basics of economic literacy
to all schoolchildren and students, as well as to adapt education to the needs of labour market.
The strategy of economic literacy and training of entrepreneurship plan adaptation of educational
content and training process of comprehensive schools to train entrepreneurship.
A lifelong learning strategy aims at establishing conditions to train entrepreneurship as one of the
main skills in the lifelong learning context in the entire system of education (including the informal
one). The activity plan of this strategy focuses on creation and implementation of continuous
vocational study programmes, which would concentrate on general abilities (including
entrepreneurship), and vocational training and continuous vocational study programmes would
evaluate social and economical as well as regional demands.
In the context of Lithuanian labour market the long-term strategy for the country’s development
perceives entrepreneurship as a political means of labour market, whereas the strategy of vocational
guidance aims at applying the training of entrepreneurship into the system of vocational guidance and
consulting.
As it is planned in the schedule of strategic policies of the country’s small and medium sized
business development until 2008 it is necessary to create a favourable environment for business
(especially legal and economical), to expand and strengthen a set of businessmen, to form a
positive image of business in the society, to establish a network of financial and non-financial
services, to create some concessions, and to encourage establishment of knowledge-based
companies. Strategic policies cover national, regional and local levels. It is extremely important to
have an adequate business development in regions, considering peculiarities, demands and
possibilities of regions, at the same time preserving particularity of each region. One of the most
important strategic policies of the country’s small and medium sized business development until
2008 is the training of human resources through the formal and informal education and consulting
and extra training system, by providing economical, managerial, financial, accounting, marketing,
and legal knowledge and abilities.
Lithuanian common programming document for 2004-2006 has also distinguished promotion of
entrepreneurship as a priority – as training of a skill and as a promotion for business (17).
There are enough programmes, strategies and initiatives of training of entrepreneurship in Lithuania,
however, majority of them are not based on practical projects; therefore their efficiency is rather low.
There is no a conventional methodology created to measure (evaluate) efficiency that would by
acceptable for scientific and business communities.
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2. The role of KTU Regional Science Park for entrepreneurship training
in Kaunas Region
2.1. Activity and Experience of KTU Regional Park
Public Institution (PI) KTU Regional Science Park (KTC) is a part of the programme of state
promotion for small and medium business (SMB), which aims at promoting entrepreneurship in the field
of high technologies, at encouragement of technology transfer processes between science and
industry, at establishment of favourable environment for business and innovations, at application of
scientific and technological achievements for regional development, at development of competitive
companies as well as the ones resistant to market changes, and lastly, at incentives to establish new
businesses and new work places. KTC is the first structure of such kind in Lithuania to offer assistance
for new business starting subjects. KTC was established on June 11, 1998. The founders of KTC are
Ministry of Economy of the Republic of Lithuania, Kaunas University of Technology and Kaunas County
Governor’s Administration. On December 11, 2006 the business incubator became KTU Regional
Science Park. Currently KTC has 19 employees - 9 of administrative and 10 of auxiliary personnel.
Since 1997, when the idea to establish the first business incubator in Lithuania originated, the
TRANSFORM programme of the German Government has greatly contributed to implementation of this
project. Until the end of the first quarter of 2000, while the TRANSFORM programme was being in
progress of application in Lithuania, Public Institution ‘KTU Regional Business Incubator’ received
around 1 million of DEM as direct investments from this programme, which were later used on training
of personnel of the business incubator as well as on interception of experience from German
technology centres by servicing technologically-oriented and young, innovative and perspective
companies. The finances were also spent on constant consultations and training of German experts in
Lithuania as well as on purchasing long-term assets, by equipping a conference hall and administration
of the business incubator with furniture and necessary special technical equipment.
The majority of foreign specialists have admitted that the project of ‘Establishment of Technology
Centre (Business Incubator) in Kaunas’ is one of the most successful among international projects
according to the TRANSFORM programme.
KTU Regional Science Park, as a promotion form of innovative and technologically-oriented small and
medium business (SMB), plays a vital role in promoting economical development of the region,
especially in improving conditions of entrepreneurship and the ones of social occupation. It should be
mentioned that by rendering appropriate promotion for newly established innovative companies as well
as by strengthening them in the process of development, a background for a new universal economical
subject to appear is created, which will later produce new items of high value added and create new
work places in the region.
Principal aims of the science park: improvement of social-economic conditions of the region by
promoting entrepreneurship in the field of high technologies and creating new work places; inducement
of application of scientific results in industry; promotion of newly established innovative and
technologically-oriented companies; inducement of development of small and medium business in the
region.
Infrastructure of KTU Regional Science Park: on December 11, 2006 Public Institution ‘KTU
Regional Business Incubator’, by a resolution of sharers, changed its title into Public Institution KTU
Regional Science Park. Judging on the achieved volume of rendered services, their complexity and
quality, the business incubator reached the rates that meet the requirements raised for science parks.
However, in order to create a universal infrastructure typical for science parks as well as to render
services that would meet demands of innovative and technologically and knowledge based business
subjects, it was necessary to re-establish the inner structure of the science park.
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The present structure of the science park consists of several interconnected subdivisions. The main
subdivision of the science park include: a pre-incubator (stage of establishment), a business incubator,
a centre of innovations and a science park. Auxiliary infrastructural subdivisions: sponsorship services
(financial mediation) and legal services (picture 2).
1. Pre-incubator: a structure, where business ideas would be ‘incubated’ and tested. The main
clients of pre-incubators are university postgraduates, scientists and specialists, who do
researches in a business sector relevant fields and search for opportunities to start their own
business by commercialising the achieved results of researches.
Premises: physically indeterminate premises, intended for generation and implementation of
ideas. Moreover, there can be ‘virtual’ rooms, when specialists work at their usual
work/research places, whereas business ideas are generated during the meetings with
consultants of the science park.
Pre-incubatory period: 6 months – from the beginning of generation of an idea till the
establishment of a juridical business subject.
This initiative of pre-incubator in the science park is at the stage of planning.
2. Business incubator (business development centre): a traditionally operating structure, which
incubates business starting SMB subjects and offers them all the necessary services needed at
the start-up. The purposive group of clients – technologically and innovatively oriented
companies, ‘spin-outs’ and ‘spin-offs’, SMB subjects that have passed the pre-incubatory
period, and other SMB subjects that were registered not earlier than 3 years ago.
Premises: physically indeterminate premises in the buildings in Student? Street 65 and
K.Petrausko Street 26. The total area intended for pre-incubation and business incubation – 40
percent of all the territory leased for companies.
Incubatory period: up to 3 years, if applying an ordinary discount of premise lease, i.e. 75%
discount – for the first year of incubation, 50% – for the second year and 25% – for the third
year.
3. Centre of innovations. Main functions: technological audit, issues of protection of intellectual
property, patenting, and monitoring as well as transfer of technologies. Make-up: regular
workers of the science park and specialists from universities and industrial companies working
under purposive employment contracts. The centre of innovations performs supervision and
selection of researches done in university laboratories, institutes and centres, audits these
researches technologically, induces commercialisation of the researches as well as
establishment of new ‘spin-outs’.
Premises: physically determinate premises in the building in Student? street 56 and
K.Petrausko street 26. Today KTU Regional Science Park is the only science park that has a
centre of innovation in its infrastructure in Lithuania.
4. Science park: a link joining together all the structure. The science park houses high-tech and
innovative companies that receive totally favourable environment to develop their own business
as well as to create new technologies and apply innovations. The purposive group of clients –
companies leaving the business incubator, ‘spin-off’ and ‘spin-out’ companies of universities
and industrial enterprises, operating in similar fields and, according to their activity profile,
capable of forming a cluster. Underlying technological fields – mechatronics and information
technologies as well as other industrial fields dominating in Kaunas Region. Companies, which
operate in the science park, do not get any discounts on premise lease nor are limitations of
premise lease term applied.
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B Ba as si is s: : s sc ci ie en nt ti if fi ic c a an nd d t te ec ch hn no ol lo og gi ic ca al l p po ot te en nt ti ia al l
A Ai im m: : k kn no ow wl le ed dg ge e- -b ba as se ed d e ec co on no om my y
(New high-tech companies, products and services, transfer of
technologies, work places)
Pre-incubator
(planned)
Centre of
Innovations
Business
incubator
Infrastructural
subdivisions:
- Financial and legal
mediation
Industry
Science and
researches
Premises: physically indeterminate premises in the buildings in Student? street 65 and
K.Petrausko street 26. The total area intended for the science park – 60 percent of all the
territory leased for companies.
Auxiliary-infrastructural subdivisions. They include:
- Financial mediation and legal services. They are private business companies that lease
premises in the science park and implement their own private goals. Form of cooperation:
mutual benefit, i.e. these companies render services for companies of the science park.
Companies of financial mediation (venture capital funds) locally find technological enterprises
that search for extra financing of the capital and invest in them.
Picture 2. Infrastructure of KTU Regional Science Park
Currently, KTC renders services of business incubation for 68 young innovative and technologically-
based companies, which employ about 480 specialists. In the run of eight years close ties were
established with Kaunas Region companies and organisations uniting them, thus informing potential
purposive groups about services rendered by KTC as well as possibilities of a start of innovative
business. KTU Regional Science Park is a member of one of the largest organisations uniting business
of Kaunas Region – Kaunas Chamber of Commerce, Industry and Crafts and Association of Kaunas
Region Industrialists and Employers. It has some cooperation agreements with Kaunas Labour
Exchange, also it cooperates intensively with Kaunas Regional Development Agency (KTC, together
with some other municipalities of Kaunas County, is one of the founders of this agency). This
determines direct participation in solving businessmen’s problems and positively influencing the
business environment of Kaunas Region.
One of the main aims of KTU Regional Science Park is to promote entrepreneurship in Kaunas
Region. In order to widely spread information on services rendered by the science park as well as
established favourable conditions for business, constant cooperation with government institutions of
Kaunas Region and associated business structures as well as scientific institutions is kept.
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Ministry of Economy of the Republic of Lithuania, Kaunas University of Technology and Kaunas County
Governor’s Administration are the founders of KTC. The latter founders play a direct role informing the
society and young specialists (university postgraduates) about opportunities to implement innovative
business ideas in KTC. This comes to close and direct mutual relations and to common and fast solving
of problems that arise for businessmen of the region.
The programme of services for innovative business is a constant and continuous process, which KTC
has been implementing since the very beginning in 1998. Currently, the science park renders services
of business information and business consultation, organises training sessions as well as events on
business spread. In order to implement the programme of innovations and competitive ability KTC has
rallied up a collective of specialists of various fields, which allows clients to receive efficient services on
many issues of innovative business.
KTU Regional Science Park contributes greatly to entrepreneurship promotion by rendering services to
businessmen and it is also instrumental in reduction of unemployment as well as occupation problem in
Kaunas Region. KTC organises events that help residents to raise their qualification and preparation for
the labour market, encourage retraining in order to adjust to the market demands and train
entrepreneurship, competitive ability and general abilities of residents of the region in order to adjust to
various changes.
To achieve this aim various activities are done: the business day festival is marked annually. During it,
KTC companies are awarded for the most substantial contribution to innovations and (or) high
technologies in Kaunas Region, for solutions of management of innovative business, etc.
Various training sessions, conferences and other events to improve companies are constantly
organised in the park. Participation is free of charge. Presence at specialised training sessions allows
businessmen to evaluate their companies from clients’ point of view, which makes much easier to
decide upon what should be improved and changed in the activity. Heads of small companies get
assistance in order to understand that both problems and success of companies are regular. It is a
system which can be managed, and most important – this could be learned.
The infrastructure of KTU Regional Science Park as well as the spectrum of rendered services and the
purposive group will definitely expand in the nearest future. This year the Government of Lithuania
approved of the national concept of KTU high-tech integrated science, studies and business centre
(valley); now its project is being drafted.
The aim of this project is to concentrate the potential of scientific researches, studies and knowledge-
receptive business in one place, to establish a common use infrastructure for scientific researches and
experimental development (SRED) and to single-mindedly pursue SRED of relevant topics for
Lithuanian economy.
Science and study institutions, scientific research institutes and business companies will be the
founders and partners of the valley. They will aim at establishing a common use infrastructure for SRED
in the territory of the valley. Some more institutions will move to the valley as well, including KTU
Institute of Physical Electronics, several science laboratories of Kaunas University of Technology and
Lithuanian Energy Institute; also a base of studies and science practice will be established there.
Science laboratories will be engaged in SRED of relevant topics for Lithuanian economy in the fields of
sustainable chemistry, mechatronics, technologies of information communication, and biochemistry.
KTU Regional Science Park takes part in the establishment of the valley. Its activity will cover the
development of the valley infrastructure as well as its maintenance and rendering of services for newly
established companies. This will secure a more efficient cooperation between science and business;
also it will encourage foundation of new companies. The valley will establish conditions for scientists
and their groups from other science and study institutions to research in the field of high technologies.
Potential of the founders is weighty: every year KTU alone fulfils around 70 percent of all economic
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orders that fall on Lithuanian universities, whereas Lithuanian Energy Institute – more than a half of
them that fall on all Lithuanian science institutes. Science and study institutions – founders of the valley
– pursue projects of the EU 6
th
Framework programme.
There is an idea (still in negotiation) to establish a Science and Study Promotion Fund for founders of
the valley and private business subjects, which will allow to financially support gifted and perspective
students and young scientists by enabling them of getting a necessary qualification, doing scientific
researches, etc.
Establishment of the valley will enhance the correlations between scientific researches and studies will
improve the quality of training of researchers and other specialists, will establish a favourable
environment for scientific knowledge and technologies to be transferred to business.
This government-supported initiative proves that the time for Kaunas University of Technology to
become a science university has come. In order Lithuanian economy faster eliminated the
backwardness from the leading EU countries, the breakthrough tendencies are associated with high
technologies. Lithuania finds the following trends of science as priorities: biotechnology, lasers,
electronics, nanotechnology and information technologies, as well as mechatronics. In the latter three
the most have been done by Kaunas Region. Kaunas academic community consists of eleven
universities and higher education schools as well as their subdivisions employing 3,168 lecturers and
almost one thousand researchers; there are more than 45 thousand students. Last year, Kaunas
people contributed to Lithuanian technological sciences by 58 percent of all scientific production,
whereas to the group of biomedicine sciences – almost by 50 percent. Kaunas pursues more than 50
projects of 111 of the EU 6
th
Framework programme, where specialists of all Lithuanian higher schools
take part (33 projects of those 50 are taken by KTU).
Breakthrough tendencies of Kaunas Region: creation of new materials and synthesis, mechatronics,
chemical industry, information and communication technologies, hydrogen energetics, micro and
nanotechnologies, biomedicine, and biomechanics. The most often heard reasons why companies
make so little investments in scientific researches and innovations are the following: imperfect
mechanisms of inducement of business investments in science and technology parks; trends of
Lithuanian scientific researches are not always related to business development and its demands; the
system of science and studies shows vague reaction to the demands of the state’s long-term
development, there is a lack of highly qualified specialists who would meet the requirements of modern
industry and business; higher education schools and institutions of scientific researches are not
interested in establishing new innovative companies due to imperfect laws; a huge demand of financial
resources and skilled employees as well as economical risk; long term to accept innovations;
bureaucratic mechanism of financing innovations; absence of bank warranties for innovations; a
shortage of specialised information; the smaller the company is and the bigger the innovation is the
harder it is implemented without an external support.
Considering the above mentioned, this initiative aims at establishing a national integrated Kaunas
science, studies and business centre (valley) by uniting efforts and focusing human and financial
resources. The valley would concentrate high-tech scientific researches done by science and study
institutions of the region, would orient them towards demands of the national business, and would
encourage to apply high technologies in the business of Kaunas Region. Initiators expect this centre
(valley) to unite all initiatives of Kaunas science and study institutions as well as the ones that promote
science and business interaction into an undivided nucleus of knowledge economy and to develop it to
an international level.
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2.2 KTC Entrepreneurship Training and Motivation Programme (case
description)
In order to start business it is not enough to have a great business idea and a wish to implement it as
fast as possible. Business start is a complex and complicated process that consists of several stages:
grounding of a business idea (it is a determination of a niche and product (service) to fulfil that niche),
evaluation of a businessman’s personal features as well as conditions of business organisation,
selection of a company’s juridical form, preparation of a business organisation project, preparation of
documents to establish a company, and registration of a company. One of the principal indicators to
start business is the exploration of a business environment. Possessing the information on business
environment and its influencing factors we can better foresee possibilities of establishment of new
business and the competitive ability of operating companies. It is proved practically that there are three
important factors determining a successful activity of a company: advantages of a new idea, skills of a
businessman and financial potential (15).
Success in small business depends greatly on abilities of a businessman, his attitudes (mentality),
business motivations, and personal features. As practice shows, small and medium companies often
fold up because of businessman’s inability to manage them. There are many characteristics necessary
for a boss in a small company but the prevailing one is a talent of undertaker, which could be described
as a sense not to consider for a long time but to make fast decisions (often with reference not to
thorough analysis of the situation, but to intuition and experience). It is also necessary know how to
convey the thoughts, give orders and control their execution.
An essential feature of SMB – constant change. Since business environment constantly changes,
companies, willing to keep and continue their activities, have to be flexible, dynamic and open. Only an
adequate reaction to environmental changes and forethought of them can guarantee the continuation of
company’s existence. This has become especially relevant in modern times, when the supply of goods
and services is rather big, and quality requirements by consumers are constantly rising. Thus, the basis
of growth, profitability, and continuation of business is the ability to supply the market with new products
and services, at the same time reducing expenditure on production and administration and searching
for new markets (15). So, application of innovations to companies becomes one of the factors
determining success.
What actually is innovative activity? It is an often case of SMB representatives to perceive innovative
activity only in its narrow sense – as application of new technologies and manufacturing of new
products. Therefore, in modern business innovative activity is recognised much broader – it is not
merely application of new technologies and manufacturing of new products, but also innovations in
management, education and design, as well as spread of information technologies. Application of
innovations in business not only gives companies the advantage over competitors, but also guarantees
a long-lasting existence of the company in market economy. Innovative activity in SMB companies is
often oriented towards the search and employment of possibilities. This means that with the aim to
meet requirements of a consumer businessmen do not necessarily create or introduce something
radically new, but also search for innovatory ideas to improve the usual activity of a company.
Company heads in modern society must be capable of combining economical and public goals. This
requires developing creativity, deepening knowledge and improving skills. Practically, people with
higher education are better at this. Businessmen having more knowledge appear to be more flexible,
stronger emotionally in critical situations and are able to better employ their intellectual abilities to solve
various problems.
Since competition in the market is rising, businessmen are forced to look for other, smarter ways to
survive and offer a consumer a necessary product or service, by using material and human resources
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very effectively. In order to secure a successful business, a businessman must deepen his
knowledge, constantly learn from what is the best and most modern in the world.
A learning businessman discovers new ways how to treat traditional things more qualitatively and
efficiently, employing competence, skills and knowledge of his employees at maximum. Various
courses, both for beginners and experienced businessmen, organised by institutions and organisations
contribute to achieving new knowledge and deepening the present one.
In the recent four years the science park has been focusing much on education of human
resources on the topic of entrepreneurship. It is constantly monitored what kind of entrepreneurship
knowledge or skills is mostly needed in the activity of companies, how their training could contribute to
the competitive ability and development of companies, also it is sought to analyse what kind of
entrepreneurship knowledge or skills is mostly lacked by different speciality students (graduates and
postgraduates) as well as how university lecturers assess demands and opportunities of
entrepreneurship training of students.
Considering a different need of training among those willing to start their own business and the ones
already having it, training sessions in the science park have been divided into two groups – a
programme of entrepreneurship training has been established (picture 3). This programme consists of
two separate parts: motivation of innovatory entrepreneurship and training of innovatory
entrepreneurship.
Picture 3. KTC actions/activities promoting entrepreneurship in Kaunas Region.
The first training cycle is more oriented towards demands of knowledge on entrepreneurship of
potential businessmen (baccalaureates and postgraduates). The purposive group of the second
training cycle of entrepreneurship programme – heads and managers of young companies as well as
all others who are thinking of establishing their own business. The aim of this training programme is
to encourage young companies to be more active, take risks, base their activities on innovations, apply
the newest and most advanced technologies, help find and exhibit the strongest personal
characteristics, and thus contribute to entrepreneurship promoting in Kaunas Region.
KTC actions/activities promoting entrepreneurship in Kaunas Region:
• Traditional assistance for young innovative companies:
- Lease of administrative/office premises in KTC under
favourable conditions; various services;
- Consultations on issues of business start;
- Forms of financial promotion for business starters;
- Assistance in preparation for and participation in national and
international exhibitions.
• Entrepreneurship training programme:
- Programme of motivation of innovatory entrepreneurship;
- Programme of training of innovatory entrepreneurship.
• Participation in activities of international and national networks
including initiatives of technological platforms and clusters;
• Partnership and implementation of international and national
projects
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KTU Regional Science Park has been organising training session for business starters since 1999. An
idea to create a systematic, purposeful and regular training programme emerged in 2004, after the
need of such trainings had been noticed. Every year the entrepreneurship training programme is
improved, renewed and offered to visitors using contemporary innovative training methods. This
programme was created by the administrative staff of the science park (director and liable managers)
together with research workers and lecturers of Kaunas University of Technology (KTU). Individual
seminars of the training programme are conducted by KTC staff, though the majority of training
sessions are conducted by KTU lecturers who possess necessary experience and who always deepen
their knowledge in a certain field. Big and professional businessmen, the so-called ‘senior
entrepreneurs’, are now and then invited to share their experience. Handover of practical experience of
‘senior entrepreneurs’ – the fastest and most efficient way to promote entrepreneurship and business.
The programme of motivation of innovatory entrepreneurship (see table 1) induces not only
establishment of commercial entrepreneurship, but also personal activeness in trying to become self-
contained by employing all opportunities and setting up the environment according to personal vision. It
is a programme, which supplements a personal ‘competence portfolio’ with lacking knowledge and
encourages visitors of the training sessions to change the status quo by themselves. Many people have
different thoughts and activity ideas, though they are incapable of identifying activity priorities. The aim
of the cycle of these motivation trainings – to help understand what kind of activity would motivate
and promote entrepreneurship, i.e. train skills, assist in finding different possibilities, raise motivation as
well as attitudes of a young man, and introduce the available promotion in the process of establishing
and developing business.
Criteria Description
Course Nb. and hours 6 courses, 48 academic hours.
Entrance criteria
-
Programme structure
1. Peculiarities of Innovatory Entrepreneurship;
2. Think Creatively. Techniques of Creative Thinking;
3. Entrepreneurship and Dynamism of Environment;
4. Entrepreneurship and Leadership;
5. SMB Promotion System and Possibilities;
6. Handover of Practical Experience of Senior Entrepreneurs.
Course time schedule
Once a week/ 6-8 hours.
Number of participants
8-12 (max 15) participants.
Table 1. The programme of motivation of innovatory entrepreneurship in KTC.
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The programme of training of innovatory entrepreneurship (see table 2) provides theoretical and
practical knowledge on marketing, financial recruitment, management of new and just-starting
companies, and training of the culture of organisation and creativity of personnel as well as
development of business based on scientific researches and experiments.
Criteria Description
Course Nb. and hours 10 courses, 80 academic hours.
Entrance criteria
-
Programme structure 1. Entrepreneurship and Innovation. Intrapreneurship;
2. Innovation and Knowledge Management. Innovation Policy. Technology
transfer between science and business enterprises;
3. Business Planning and Development. Technology Strategy Methodology and
Business;
4. Marketing Strategies. Business Internationalisation;
5. Project Management;
6. Financing Possibilities of Innovative Business;
7. Human Resource Management. Motivation. Leadership;
8. Organisational Culture and Management;
9. Intellectual Property Rights. Licensing;
10. Senior Entrepreneurs’ Stories of Success and Practical Advice (‘How to
Become Successful’).
Course type/ used methods
Courses are based on group/team work, active training methods, video material,
and discussions.
Course time schedule
Once a week/ 6-8 hours.
Number of participants
8-12 (max 15) participants.
Table 2. The programme of training of innovatory entrepreneurship in KTC.
The programme is based on the concept that knowledge should be gained not only in a seminar, but
also communicating directly with experienced businessmen, participating in practical trainings of
nurturing businessman’s personality and character, analysing practical situations, modelling business,
and working in teams.
Besides, the programme contributes greatly to the improvement of quality of business plans from the
growing number of projects from different sources (business angel networks, venture capital funds,
programmes of municipalities and business promotion agencies). Business plans, prepared in the
process of trainings, can be implemented in the KTU Regional Science Park.
In order to create the programme of training of innovatory entrepreneurship international experience in
the fields of entrepreneurship training and promoting was taken as the basis, which is believed to have
greatly influenced the demand and efficiency of entrepreneurship trainings, as compared with
analogous entrepreneurship training and promoting programmes, currently existing in the market.
This training programme contributes to the development of knowledge-based business, establishment
of new companies (especially in the priority fields of high technologies), their internationalisation,
creation and commercialisation of new products, and strengthening of links between science and
business.
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3. Current challenges/ problems facing the organization and educational
effort
In pursuance of the policy of the rapid development of integrated economy it is vital to create a
favourable climate for entrepreneurship training in the society, aiming at a change of mindset as well as
at improvement of skills and elimination of obstacles of establishment and development of new
companies. Considering this, next to the discussed and pending problems of regulation, taxes and
finances, it is advised to create and apply horizontal means for the establishment of promotion basis of
the entrepreneurship policy.
In order to more efficiently organise processes of entrepreneurship motivation and training as well as its
development in the activities of science parks it is important to consider and evaluate properly such
processes like organisation of innovative business, purposeful investment and constant training.
Innovations and entrepreneurship are not always interconnected. Due to insufficiently close
cooperation among scientific research institutions, universities and businessmen in the fields of
researches and creation of new products and technologies for the market, businessmen do not always
find innovations attractive. Usually the fields of scientific researches pass business demands and a lack
of results suitable for commercialisation is felt. Therefore, one of the most important tasks in this field is
to train entrepreneurship not merely among companies that apply innovation practically, but also
among scientists and researchers. This would significantly increase the relevance of scientific
researches towards business, would encourage researchers and scientist to be more active while
implementing tasks of technological development, and choosing research subjects, international
experience and databases would be employed.
Entrepreneurship training and investments in innovations are essential not only for high-tech
companies, but also in branches of traditional industry and service sector. An innovatory attitude
towards business management and a constant application of innovations contribute to improve labour
productivity, efficiency, quality, and at the same time – international competitive ability of a company.
Considering the low level of innovative activity of the country’s business companies, it is essential to
intensively stimulate creative innovative activity, i.e. intensify cooperation between business and
scientific research institutions, induce the development of researches done by companies and support
the establishment of technical facilities necessary for this kind of activity.
It should be mentioned that there are cases when heads of Lithuanian companies do not know that
they have some problems, which impede the development of a successful business, therefore it is
important to help find them. Entrepreneurship trainings, organised by institutions of the network of
public services to business, are often very helpful in solving problems of the lack of knowledge or skills.
Thus, accessibility of public services to business, its content and quality, conformity with demands of
business companies and business starters, is an important factor to raise the level of entrepreneurship.
A lot of national and regional means are often initiated on the basis of priorities stated in EU or national
programmes. When implementation period of these programmes is over and new ones appear, the
further pursuance of these initiatives is usually intermitted. Therefore, consultation services and training
cycles are often unfinished. As a result, when forming entrepreneurship training programmes, it is
essential to project their continuation after financial resources end up.
Application of innovations to business is basically done as adaptation of necessary technologies, but
not as creation of original knowledge or application of somewhere else created innovations. Only the
national and European long-term promotion can be helpful in creating and applying strategically
advanced innovations practically.
The Lithuanian system of means of financial promotion for SMB is not fully developed. Credit
institutions are not very active in granting micro-credits for business starting companies, there is a
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passive activity of venture capital funds in the field of sponsorship of projects created by young
innovative companies. Innovations are always related with big risk, therefore, due to the over-risky
projects, banks often refuse to finance them. In foreign countries informal individual investors –
‘business angels’ – come to help. They are ready to invest their capital in risky businesses just
appealing to their experience and interests. In Lithuania the real ‘business angels’ still do not exist,
because there are not many people who freely hold the sums bigger than 100,000 euros, thus, only
unification of ‘business angels’ can be discussed. Notably, the demands of modern business are bigger
than business patrons can offer.
Businessmen need to be prepared for management of investments, since the expenditures, necessary
for doing innovative activity, are planned easily, but the income – is not. Many businessmen lack
financial resources to order investment projects at experienced companies, thus, trainings that focus on
practical preparation are relevant and necessary. Such training sessions allow businessmen to prepare
investment projects on their own with the help of consultants.
It is not a rare case when university graduates become initiators of an innovative business. The data of
various researches indicate that graduates of American universities already know how to start their own
business; however, the ones from the EU (including Lithuania) lack the knowledge. While studying they
do not get practical knowledge, because business and technology studies are often unrelated to
practice. Therefore, universities should aim at making entrepreneurship an important part of their
syllabi, for combining entrepreneurship-based attitude and abilities acquired in science and technical
studies, students and researchers will have an opportunity to better commercialise their own ideas as
well as developed new technologies (21).
Systematic entrepreneurship training in university and college studies is also integrated into
programmes of technical disciplines. This establishes better conditions for ‘spin-offs’ and innovatory
companies to appear and helps scientific researchers gain entrepreneurship skills.
‘Spin-offs’ – companies that were established on the basis of researches done by higher education
schools – are more often emphasised as a means of strengthening the development of local economy.
However, their rates of establishment and development are very dependent on scientists’
entrepreneurship abilities. Due to some inner barriers, like a system of career, which is built on
academic achievements, the entrepreneurship of the latter at universities is not appreciated positively.
It is very important to have the necessary number of lecturers to teach entrepreneurship training
disciplines, to secure their qualification and intensify their international exchanges. Currently, innovatory
training methods of entrepreneurship are applied and constantly developed in the EU, also their
practical effect is analysed, therefore, active international interchange of this practice is available.
Having evaluated Lithuanian scientific potential, it can be stated that only a minor part of modern
technologies, which are necessary for Lithuanian companies, can be created in Lithuania. This means
that Lithuanian companies will have to purchase the vast majority of modern and competitive
technologies in other countries. The rise of such tendencies has already been noticed. To purchase
foreign technologies and apply them in our companies is a more complex task than to do the same with
local technologies. Often such a task is too complicated for Lithuanian small and medium sized
companies, which lack experience in international cooperation, transfer of intellectual property and
application of technologies. Here, the role of science parks and centres of innovations is very
significant, as are their international contacts and assistance for firms when applying for BP-7, COST,
Eureka, and other EU programmes.
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4. Conclusions
One of the principal aims of the policy of small and medium sized business development of the
Government of the Republic of Lithuania – to establish favourable conditions for new companies to
appear, to increase the rates of successfully working companies as well as their competitive abilities.
This requires government institutions to constantly observe and consider dynamically changing
situations of business companies, to review, improve and/or foresee new means of promotion,
development and inducement as well as long-term programmes for the further development of
entrepreneurship in the country.
The government, implementing the programme of small and medium sized business development,
needs to cooperate, i.e. be in a continuous relation with heads of companies and consider
businessmen’s opinion on the contemporary business environment in the country, to evaluate present
and rising problems and impediments/obstacles of business development, and on their basis to set
actions in the direction of making the applied means more efficient. Due to such a constant contact
between government institutions and business representatives, the level of entrepreneurship in the
country would much higher, because, considering positions of the Government and businessmen, it is
noted that they have different approaches on the same economical phenomena.
An entrepreneurship training system has been established and is practically applied in all levels, from
school to university. It has been conceived that schoolchildren should get information on business
opportunities from the early age. They should be taught of it as a possible future occupation. Moreover,
the main skills of entrepreneurship and creativity must be trained, as well as self-confidence in any
activity. Universities must include principles of entrepreneurship into study plans as an important part of
training programmes and encourage or even demand students to choose the courses of
entrepreneurship training (19). This initiative is a part of Lisbon strategy for growth and jobs.
Entrepreneurship – a person’s ability to implement ideas, take the initiative, be responsible, take the
risks, and pursue set tasks. In Lithuania both young and older people gradually find favourable
conditions and opportunities to improve their abilities and skills in the field of entrepreneurship. There is
a network of institutions to serve business (BI, BIC), structures of innovative business promotion (STP,
IC, AISTDP) and other advantageous initiatives are being established, such as science valleys or
technological platforms and clusters, which will intensify cooperation between science and business in
our country.
The principal reasons due to which means of entrepreneurship training are slowly developed:
- Uneven technological and managerial level of big business objects and small business
subjects;
- Not many examples of successful cooperation in international networks, which would promote
entrepreneurship training;
- Abundance of strategies and programmes does not allow the authorities to appropriately focus
on the common formation of the policy of entrepreneurship training and application of
innovations.
Insufficient level of entrepreneurship in the society is one of the main problems of development of small
and medium sized business. It should be solved by pursuing the state’s integrated policy, covering the
promotion of entrepreneurship-based attitude by coherent training and teaching of the residents as well
as the elimination of obstacles of business establishment and development. Entrepreneurship training
increases possibilities of the establishment of new companies and their self-contained activity.
122
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123
‘Development of Human Resources’ of the Lithuanian Single Programming Document of 2004-
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Chairwoman of a commission of integrated science, study and business centres (valleys), 2007
124
How to Take Off?
The OURCHIP Company
Jacek Klich (Ph.D.)
Jerzy Rosi?ski (Ph. D.)
Institute of Economics and Business Management (Jagiellonian University), CITTRU
Poland, 31-387 Krakow, Gronostajowa 3
Fax: +48 12 664 69 14
Jacek Klich: [email protected]
Jerzy Rosi?ski: [email protected]
Keywords:
hi-tech companies; IT companies; financing IT companies;
Abstract
The case introduces the post-start-up stage and dilemmas pertaining to this stage of development of an
innovative, high-tech company in a southern region of Poland.
It argues that institutions for promoting entrepreneurship in the region failed to provide the entrepreneur
with adequate assistance.
This case shows that the access to financing and to highly educated programmers is of prime
importance to newly created companies operating in IT sector. Furthermore, the case underlines the
necessity of harmoniously orchestrating the activities at the meeting point of “triple helix” elements, i.e.
universities, local governments and businesses.
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1. Background
Adam was born in Poland. He has spent most of his life in the USA where his parents emigrated in the
second half of the 1980s. He finished college there, graduated from the prestigious Massachusetts
Institute of Technology in Boston. He is now an engineer specialising in designing integrated circuits.
Willing to discover his country of origin and his parents’ homeland, Adam decided to come to Krakow
and take up post-graduate studies at the Jagiellonian University. In 2005 he completed a two-year
course in European Studies for Foreigners, in the English language. One of the modules was on the
subject of entrepreneurship and business management in post-communist countries, offering
information on opportunities awaiting foreign investors in these countries, and on the rules of private
entrepreneurship in Poland.
Upon completion of the studies, taking advantage of the opportunities he had identified for himself on
the Polish market, and particularly in Krakow, Adam seriously contemplated starting a business in
Krakow. After analyzing his personal resources- fluency in English, double citizenship (Polish and
American), expert knowledge of computer programmes and integrated circuits - and, most importantly,
armed with an idea for a business, he took steps to register his new company and start up a business.
2. Setting the stage
During his two years in Krakow Adam became acquainted with the city’s milieu, deliberating (with
varying degrees of intensity and determination) over starting up his own business.
He resolved to set up his business in Krakow and to focus on comprehensive software design and
software applications (Appendix: Business Opportunities in Malopolska voivodship).
He recognized the fact that Krakow had key resources for his future company (highly qualified
programmers), and there was a market (with excellent prospects) for such services.
In February 2006 (having considered various options and consulted lawyers in Poland and in the USA)
Adam registered OurChip, a limited liability company with a capital of 46,000 PLN. The planned strategy
of the company determined its organisational form. Namely, over the long-term, Adam’s company was
to operate globally, cooperating with large enterprises in the IT and Electronics sectors. However, he
first needed to establish a bridgehead on the Polish market (which he perceived as upwardly dynamic
and sizeable enough for the first stage of the company’s development). Once he secures a position on
the Polish market and in other post-communist countries of Central and Eastern Europe, the company
will expand overseas, primarily in the direction of the USA market, about which Adam was very
knowledgeable.
Initially Adam considered setting up his company in the USA, but he soon abandoned the idea, being
afraid that a small, unknown company registered in the USA will have more difficulties breaking through
in the local and national market. Registration of the company in Poland would generate more trust
among potential partners, who could attest to the company’s credibility with the National Court Register.
Registration of the company in February 2006 did not amount to starting up a business. At that point
Adam embarked on recruiting programmers for his team. As it turned out, the task ran counter to the
earlier assumption of an easy accessibility of highly qualified programmers.
What Adam previously considered as a favourable factor (Motorola opening its programming centre in
the special economic zone, thus expanding the market for his company’s services) turned out only to
create competition for resources - highly qualified programmers. On entering the Krakow market,
Motorola scooped up 200 programmers. The aura of a global corporation, and the tried and tested
procedures of recruitment led to a prompt and successful completion of the teams, draining the local
market of programmers.
The situation was further exacerbated by the wave of migration of the young generation of Poles to the
old UE countries (following Poland’s accession to the UE on 1
st
May 2004).
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Besides standard recruitment procedures (announcements in press and on the Internet), Adam
established contact with the head of one of the AGH (University of Science and Technology)
departments specializing in programming, and found a group of students of the final year.
After 6 months of these (and other) endeavours, Adam succeeded in securing a team of five
programmers.
Along with his ‘quest’ to complete the team (other than the recruitment process itself), Adam came up
against a series of problems, such as, e.g.:
• Working agreements with the specialists. Initially Adam did not want to employ the
specialists under standard National Labour Law regulations as, according to the Polish labour
code, employees are granted with special entitlements that burden the employer (social and
health insurance, flexi-time, days off and mandatory holidays, etc.) and curtail the employer’s
rights with regard to dissolving the said agreement. He wanted the workers to work under
contracts, which would specify duties of every worker and the remuneration based on
assignements. According to Polish Law this is feasible if the programmers register their own
business and operate as sole proprietorship entities subcontracted by OurChip. However, as
the employees were not interested in self-employment, Adam had to abandon the idea of
cooperation based on contracting and started preparing suitable work agreements which would
stipulate remuneration based on task achievement. This, however entailed yet another problem.
• Motivating workers. As the company did not sell services at this stage (vide Appendix 1), it
was too early assess the market success (sales) of the work input (programmes under
construction). Adam had to persuade the workers that their work and commitment in the
company over the first months (or even years) of the company’s operation had to be perceived
in the categories of an investment. This argumentation sounded plausible as the programmers
(specialists) did appreciate the value of the product their company was to offer (vide Appendix
2)
• Confidentiality of data. Another important issue to be considered when drawing up work
agreements pertained to intellectual property of the solutions created by the company, and
confidentiality of the circulation of the information (both internal and external). Much as these
issues (and others, not mentioned here) were of importance and had to be included in the
working agreements, Adam did not decide to employ the services of a firm specializing in
drawing up appropriate documentation. He only solicited informal advice from his
acquaintances, an economist and a lawyer among them.
3. Current challenges facing the organization
Originally, the company was to focus on all types of work relating to software and software applications.
Adam did not define the type of software product of the company, nor the sectors of economy (e.g.
software for banks, insurance companies, hospitals) nor corporate entities (small or large enterprises)
that the product offer would be addressed to. Adam admitted that his idea for business was not
accurately defined and he relied on his own ( and his employees’) flexibility and creativity, rather than on
a thorough analysis of specific sectors.
The first product to be launched was System On Chip (SoC) – an alternative to wireless
telecommunication. The product was still in the process of construction and its specifications subject to
previews.
The failure to clearly define the target group resulted in, among others, low effectiveness in hunting for
orders. The running costs incurred in the company’s operation’s (vide Appendix no. 2) made Adam
revise the strategy and orientation of the company, shifting from software design to a unique form of
technology designing electronic components.
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4. Breakthrough technology and product
OurChip Company is in possession of highly innovative technology for designing integrated circuits. By
designing the advanced integrated circuits OurChip has worked out a unique designing programme
originating from the traditional VLSI method, yet unprecedented in the electronics. The technology may
be an asset if the company launches the products based on plastic (as an alternative to electronics
using silicon), which is bound to take the market by storm and become the product leader in the years to
come.
Adam’s expertise in the field can help the design of microchips on nanomaterial board, and in
consequence, to provide end users with a product that could not have been conceived using standard
technology. At this stage the company does not have a prototype of the microprocessor. However the
product – a microcontroller on nanomaterial board - may be ready within 2-3 months.
Advantages and disadvantages of the future product
Advantages
– flexible (pliable);
– light (small weight);
– thin (thin circuit construction);
– aesthetic;
– more environment-friendly than the circuits manufactured on silicon base;
– low costs of production of the integrated circuits adapted to the needs of specific customers
(custom design).
Disadvantages
– short durability (8-18 months, depending on the materials used);
– lower efficiency, in certain respects, as compared with silicon integrated circuits
– larger board size as compared with silicon based circuits;
– as with previous boards, the source of power is still required, which may adversely affect such
advantages as: flexibility, lightness and enhanced eco-friendliness.
5. Research and development operations
The company is innovative and professional, carrying out research on technology, production and the
market. Thanks to R&D, the employees not only have their finger on the pulse of the latest changes in
the market but are also able to react accordingly.
The company’s R&D is effective, leading to satisfying results, yet it impairs proper functioning in other
areas, e.g. finance management or market research.
The company is afflicted by an ailment common for micro-enterprises – an insufficient number of
workers that specialize in other matter other than the core function of the company (in this case: other
than designing integrated circuits).
Synthetic SWAT analysis for OurChip Company produced by Adam is represented in Tab.1.
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Tab. 1. SWAT for OurChip Company
Strengths
- unique technology for designing integrated
circuits on the nanomaterial board;
- no competition in market niche of the design of
the microcontrollers based on nanomaterials;
- competent, young and highly-motivated team
of programmers and engineers;
- company’s image in line with
requirements set out by the UE support and
investment programmes aimed at supporting
innovative enterprises;
Weaknesses
- low credibility of the company, e.g. no evidence of
plausibility of the new technology,
- limited knowledge on the possibility of producing
plastic-board microcontrollers, their parameters and
properties;
- no capital available to secure uninterrupted work on
prototypes and the company’s development;
- no department responsible for finances and strategy
in this respect;
- no experience;
- no insight into mass production of plastic-board
microprocessors;
Advantages
- prospective popularity of electronics based on
plastic;
- financial support from government institutions
or business/ new technologies organizations;
- establishing cooperation with scientific bodies
interested in research on nanomaterials;
- getting an order to design
a microcontroller to a large system;
Threats
-feeble interest in designs of electronic circuits based
on plastic due to their restricted efficiency;
- low profitability of designing plastic-based circuits,
- reinforced competition in the branch or monopoly of
big corporations;
-no possibility to produce the circuit prototype or to
establish a serial production;
- OurChip microcontroller’s incompatibility with a
larger system within which it is to operate;
6. The steps taken by the company in order to gain capital
At this stage of company’s development raising capital for further development of the company featured
prominently on Adam’s list of priorities.
As early as the beginning of 2006 Adam made attempts to acquire the capital of 600-800 thousand
PLN.
The bank loan option was played down from the start as, according to the opinion shared by six bank
institutions, the company was not creditworthy and failed to present suitable credit security that the
banks evaluated to be in the range of 1.1 - 1.4 million PLN.
OurChip was not in debt, and its overhead expenses were covered from the owner’s personal
resources. Nevertheless, the company did not process any orders and did not have any income. The
company’s capital was insufficient to secure credit in the range of 600-800 thousand PLN.
Adam ventured further to raise the necessary capital. Armed with information on the well-developed
infrastructure of support for entrepreneurship in the Malopolska voivodship, and in Krakow, he
embarked (all starry-eyed) on a search of institutions and organizations that would be ready, willing and
able to assist him in getting the capital needed for the development of his highly innovative company.
Unfortunately, the first problems started to crop up as he was drawing up a list of institutions and
organizations that offering support to entrepreneurs in finding capital. Although the list of business-
related organizations in the Malopolska voivodship showcased over 57 institutions or organizations,
excluding the banking sector (Information Booklet 2006), Adam managed to identify only 12 of them. On
closer inspection the list of organizations that could (potentially) help OurChip to obtain the capital
needed was narrowed down to seven only:
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- Business Center Club Loza Malopolska
- Foundation for Economic Promotion of Krakow Region
- Centre for Innovation, Technology Transfer and University Development
- Academic Incubator of Entrepreneurship
- Micro Fund Ltd. with a branch in Krakow
- Micro Initiative Ltd.
- Malopolska Agency for Regional Development
The visits and talks in each of the organizations mentioned promptly revealed the fact that none of them
had the capacity to assist or perform intermediary functions in securing capital in the range of 600-800
thousand PLN. Moreover, despite claiming to offer counseling services (or even assistance in drawing
up project applications for EU programmes), none of the above organizations provided competent
assistance, nor information about a person or institution that would help Adam resolve the problem.
In April 2007, a financial specialist was appointed and assigned the task of preparing a list of possible
sources of capital.
The list prepared by the new employee comprised:
- resources from European Union sources (structural funds)
o Human Resources Operational Programme (B8, Z2)
o Innovative Economy Operational Programme
Priority Axis 4. Investment in Innovative Enterprise (B1, B2, B3)
Priority Axis 5. Information Dissemination.
Axis 6. Polish Economy on International Market:
- Malopolska Programme for Regional Development
- Private Equity and Venture Capital Funds
- Business Angels
- Support programmes other that structural funds:
o Industrial Development Agency (joint stock company). Innovation Centre FIRE ARP
(joint stock company).
Together with the new financial specialist, Adam started to analyse the rules and procedures of
application for resources within the structural funds of the European Union. It soon transpired that two
heads were not enough to analyse and evaluate every single programme assessing their suitability to
assist the company in getting the necessary capital.
The attempt to participate in the Malopolska Programme for Regional Development also failed.
Following a series of interviews with clerks in the Voivodship Office in Krakow, in an attempt to join the
programme, Adam was led to believe that his ‘far from impeccable Polish, and his dual citizenship
undermined the credibility of his assertions that he could run a business in Krakow at least until the year
2012.
Tired and disappointed, Adam turned his thoughts to Private Equity and Venture Capital funds. This
segment of the financial market has not been sufficiently developed in Poland and the supply of capital
is far from substantial. However, this is not the biggest problem for Adam. The problem is - should the
investor be found - Adam may face the prospect of losing independence and control over the company.
Adam still firmly believes that the new technology of integrated circuits on the plastic base has excellent
prospects, and he would like to be a part of it.
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7. Latest actions of OURCHIP
Early in 2007 the company undertook actions to set out principles of information strategy regarding the
future Our Chip product, addressed to:
a) companies operating on integrated electronic systems (potential customers)
b) investors
c) would-be employees (e.g. Financial Director, Operational Director)
As previously, OurChip does not communicate a single, accurately defined product, but only signals
‘(…) a promise addressed to the target groups’ (Communication Strategy 2007). Although the future
product of OurChip will take on the form of microcontroller, the media message will carry a wider
definition: microprocessors.
This promise translated into an advertising text which read as follows:
‘Our unique technology of designing microprocessors on a nanomaterial board enhances the products
and systems and results in a pioneer, unprecedented value for the end-user’.
8. Further Reading. Support Material. Questions and Answers.
1. What is the most serious problem looming ahead for OurChip company?
2. What mistakes has Adam made?
3. What types of dysfunction may be identified in the enterprise and business support system in
the Malopolska region? To what extent are these dysfunctions typical of the region and of
Poland, in general?
4. Which option of acquiring the resources for the development of OurChip company seems most
appealing? Why?
Ad 1)
Raising the capital prerequisite for further development of the company is not the only problem OurChip
is faced with. This problem stems from the lack of a hallmark product that could be offered to the group
of clients and investors alike. This, in turn, is connected with a lack of clearly defined strategic planning.
Ad 2)
The owner has made several mistakes:
– not defining with sufficient accuracy neither the product nor the target group
– while emphasizing the importance of technological and production research, he has neglected
market research
– not conducting an analysis of the potential integration .
Ad 3)
– insufficiently developed subsystem of financing business enterprise, especially in the area of new
technologies
– lack of coordination between institutions building the system, e.g. exchange of information, re-
directing entrepreneurs to other institutions where they could receive the assistance they require
– bureaucracy and reserved trust towards entrepreneurs
Ad 4)
Considering the limitations of the Polish system, it would seem appropriate to turn to VC and PE groups
as well as business angels. The American connections of the company owner and his familiarity with the
American financial market may be of help.
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9. Lessons learned
- in identifying certain possibilities of setting up a business operation, the entrepreneur must
accurately define the product (or service) as well as the target group
- the flexibility of the offer and focus on the client’s needs does not justify neglecting the creation of a
hallmark product or service, to gain at least borderline credibility in the eyes of the client
- to design integrated circuits it is prerequisite to set out in advance a strategy of integration
- the specific characteristics of the integrated circuits design sector make it very implausible for the
advanced projects to be realized by small, emerging companies.
10. List of additional sources
Appendix 1: Business Opportunities in Malopolska voivodship
(from:http://www.cracowonline.com/36, Business_and_Education_Opportun.htm)
The most visible feature of the Malopolska voivodship’s (Malopolska region) economy is its great
diversity. All significant branches of economy are represented here - from high technologies and
banking to chemical and metallurgical industries, coal, ore, food processing, spirit and tobacco
industries. The most industrialised city of the voivodship is Krakow. The largest regional enterprise is
operating here the Tadeusz Sendzimir Steelworks employing 17,000 people. Another major industrial
centre is located in the west, in the neighbourhood of Chrzanow (production of railway engines) and
Oswiecim (chemical works).
Tab. 2 Key figures about Malopolska region
Capital Krakow
Area 15,144 sq. km
Population
- of which urban
3,260,900
49.7%
Special Economic Zone Krakow Technology Park
Universities 18 (including: Jagiellonian University, AGH
University of Science and Technology, Krakow
University of Economics, and Krakow Technical
University) with approx. 200,000 students
Selected business supporting
organizations
Investor Assistance Centre, Krakow
Malopolska Agency for Regional Development
(joint stock company)
International airport Krakow – Balice
Main sectors IT, banking, food processing, spirits, tobacco,
chemical, coal, steel
Registered business entities
- of which with foreign capital
290 687
2 609
FDI as of December 2005 reached USD 6,840 billion. Since 2000 the Malopolska Region’s share in total
foreign investment in Poland has been highly stable, in the range of 7.3-7.6%. This tallies with the
Malopolska voivodship’s share in the GDP, which was at 7.2 - 7,5% in the same period. FDI in
132
Malopolska is diversified geographically, with Krakow, which has 23% of the voivodship population,
attracting 70 percent of FDI, mostly in trade and services. FDI is concentrated in Krakow and in the local
county areas: Krakow, Wieliczka, alongside the western borderline of the voivodship, in the counties of
Chrzanow, Olkusz and alongside national road no. 4 (from Krakow to Tarnow).
Selected foreign investors with over $1 million worth investments in Poland, present in Malopolska
voivodship:
• HVB - banking
• Kronospan Holdings Ltd. - wood and wooden products
• Saint-Gobain - glass manufacturing
• Philip Morris - tobacco processing
• Electricite de France Internationale - power, gas and water supply
• IPC - pulp and paper
• Air Liquide - chemicals and chemical products
• Pliva - pharmaceutical
• Delphi Automotive Systems - automotive
• Fleury Michon - food processing
• Carlsberg - brewing
• Man - automotive
• Becker Industrial Coatings AB - chemicals
• Electrolux - BPO - finances centre
• Royal Dutch Shell Group - BPO – finances and bookkeeping centre
Other companies have located their finance and accounting quarters in Krakow, e.g. Cap Gemini or
Lufthansa, or research centres: ABB and Delphi, or software design centre, e.g. Motorola.
Krakow
Krakow (with the population of nearly 780,000) is the scientific, administrative, financial and economic
centre of Southern Poland. It is a city with over a hundred research and development institutions, as
well as 18 universities, among others:
Jagiellonian University (number of students: over 44,000)
Selected faculties: medical analysis, biology, biotechnology, chemistry, physics, geology, information
technology, materials engineering, mathematics, law, psychology, sociology, medicine, dentistry.
AGH University of Science and Technology (number of students: over 28,500) Selected faculties:
automatics and robotics, electronics and telecommunication, geodesy and cartography, mining and
geology, information technology, materials engineering, metallurgy, chemical technology.
Krakow Technical University (number of students: over 16,000) Selected faculties: automatics and
robotics, construction, electrical engineering, technical physics, information technology, chemistry and
process engineering, mathematics, mechanics and machine construction, chemical technology.
Krakow University of Economics (number of students: over 18,500) Selected faculties: economics,
finance and banking, spatial management, information technology and econometrics, business and
marketing.
133
Krakow Academy of Agriculture (number of students: 10,000) Selected faculties: biotechnology,
economics, geodesy and cartography, environmental engineering, forestry, horticulture, agriculture,
agricultural and forestry technology, animal husbandry.
By the end of 2004 the R&D institutions in Malopolska voivodship employed over 17,000 workers, which
accounted for 13.5% of the total number of employees in the sector.
With over 60% of residents under 45 years of age, Krakow is the city of the young and well-educated
who provide a perfect environment for the development of economy and constitute a decisive factor of
the successful development of the region.
The exceptionally powerful position of Krakow as a research and scientific centre, a host of completed
investments (including infrastructural ones), the young, skilled and well-educated workforce, easy
accessibility and transport connections, and last but not least, the most exceptional atmosphere, are
among the foremost magnets for investments and business activities.
Human resources are an indubitable asset of Malopolska voivodship. Compared with other regions in
Poland, Malopolska fares better with respect to: demographic profile, society age-breakdown, situation
on the labour market, social confidence (citizenship society).
The Special Economic Zone: Krakow Technology Park
The Special Economic Zone - Krakow Technology Park was established in 1998. Its territory,
appropriated for industrial development (greenfield investment projects), covers a total area of 122.07
ha and consists of four sub-zones located in Krakow and Tarnow.
The strategic objectives of the Special Economic Zone include: development of the advanced
technology sector, in particular information technology and telecommunication networks, material
engineering, health care, medical engineering, genetic engineering, biotechnology and environmental
protection ensuring favourable economic, organisational and infrastructural conditions for domestic and
foreign investors employment of the scientific and research potential of local universities by the transfer
of the results of scientific research and advanced technologies to the industrial sector, as well as
education and training of professional staff supporting the development and restructuring of the existing
companies by the delivery of innovative technologies and organisational concepts.
The Krakow Technology Park consists of four separate areas: the 36-hectare Jagiellonian University
Technology Park, the 30-hectare Technology Park of the Krakow University of Technology, the 35-
hectare Sendzimir Steelworks Technology Park, and the youngest 21-hectare Tarnow Industrial Cluster.
The first three are situated in various corners of Krakow itself, whereas the last one has its location in
the city of Tarnow some 90 kilometers east of Krakow.
Main Investors in The Special Economic Zone - Kraków Technology Park:
• Motorola Inc. (USA)
• RR Donnelley (USA)
• AMS (USA)
• ComArch SA (Poland)
• AZ-Soft SA (Poland)
• Alcro-Beckers AB (Sweden)
• ABM SOLID SA (Poland)
134
Like in other special economic zones, entrepreneurs investing in SEZ-KTP may apply for public support,
i.e. income tax exemptions. These exemptions are granted to companies implementing investment
projects or providing new job opportunities.
Labour market
Total number of employees in the voivodship (as of August 2005), is at 2,031,000.
Numbers employed in selected sectors:
• Industry (total): 173,051
• Construction: 28,104
• Trade and repair: 87,113
• Hotels and restaurants: 8,323
• Business services including real estate: 31,759
Average monthly gross salaries in private sectors:
• industry: 2,355 PLN
• construction: 1,940 PLN
Unemployment rate in the voivodship: 14.0% (at 18,1% average in Poland)
Total number of the officially registered unemployed: 180 900
The Malopolska region has well over several dozen institutions supporting economic growth in the
region and across Poland. The agencies and foundations encompassing the entire voivodship include:
• Malopolska Agency for Regional Development (joint stock company) (MARR),
• Malopolska Agency for Energy and Environmental Management Ltd. (MAES),
• ‘Partnership for Environment’ Fund, (FRLD-MISTIA)
In 2004 in Malopolska voivodship there were 15 institutions for promotion of economic development, 21
economic organizations (economic self-government, chambers of commerce, etc.) and 17 other
organizations supporting entrepreneurship.
In 2003 in Malopolska voivodship there were 31 commercial banks, with the total of 418 branches, as
well as 5 (out of 16 in Poland) institutions offering loans:
• Fund for Economic Promotion of Krakow region
• Fund for Development of Rabka Region
• Mikro Initiative Ltd.
• Malopolska Agency for Regional Development
• Local Government Association for Entrepreneurship and Development
• In 2003 in Malopolska voivodship there were 3 funds for credit warranty, of which only one was
in Krakow (Malopolska Agency for Regional Development)
The analysis of the following key indicators of the level of competitiveness in the year 2003 placed
Malopolskie voivodship on second position as compared with Mazovian, Silesian and Pomeranian
voivodships:
• workforce headcount in research and development per 1000 population
• the ratio of investments in research and development (R&D) per 1 inhabitant,
• the ratio of investments in innovative business in industry per 1 inhabitant,
• the ratio of investment in research and development to GDP,
• the number of automated and computer-led production lines per 1000 industrial enterprises.
135
Malopolska Voivodship Strategy for Growth (excerpt)
Area 1: Active and knowledgeable society
Development of information society integrated public services on digital platforms
– mobile phone network, 3G, VoIP, digital television, Internet, etc., operating round the clock,
• system of educational services
• system of trainings for workers of public and educational institutions
• tele-information solutions enhancing social convergence and citizens’ participation in public life
(e-democracy)
• reinforced investments in research on Information and Communication Technology (ICT)
• system of support for innovation and investment in ICT branch development (including MSP)
• system of development of human resources for the sector of innovation technologies and ICT
References
Doma?ski B., Jarczewski W. (eds) ‘Climate for Investment in the Malopolska Region’, Department of
Economy and Infrastructure, Marshal Office of the Malopolska Region Krakow 2006
Grupa Stenna, ‘Pole C – Gospodarstwo, kapita?, kreatywno??, technologie’, Warsaw 25 July 2005
Information Booklet (2006) Business Organisations and Research and Development Institutions in the
Malopolska region, Krakow December 2006
OurChip Co. (2007) Communication Strategy,
Strategy for the Development of the Malopolska Region - Ma?opolska 2015, Marshal Office of the
Malopolska Region, Krakow 2006
136
Appendix 2. Financial Analysis of OurChip performance in the period of February 2006 – December 2006
ASPECT March April May June July August Sept Oct Nov Dec
1
2
3
4
Receipts from sales of services
Other receipts with surplus profit
Subsidies
(+) decreased (-) increased receivables
1820
380
-
-
2150
450
-
-
2400
380
-
- 1 000
2380
680
-
- 1200
1700
750
-
- 1300
1950
610
-
-1450
2180
610
-
-1600
3150
560
-
-1780
2850
410
-
-1950
3850
440
-
-1880
I Total receipts 1+2+3+4 2200 2600 1780 1580 1760 1100 1190 1930 1310 2410
5
6
7
8
9
Incurred costs of sales diminished by
amortization and interests
Taxes (income, VAT, and other)
Extra losses
(+) increased (-) decreased stock inventory
(+) decreased (-) increased accounts
payable
15 000
12 200
450
200
-
-
16 300
13 500
520
250
-
-
18 000
15 200
340
280
-
-
18 500
15 700
310
270
-
-
19 400
16 600
340
210
-
-
19 800
17 000
220
230
-
-
25 000
22 200
230
780
-
-
30 000
27 200
380
850
-
-
31 000
28 200
260
950
-
-
33 200
30 400
480
1100
-
-
II Total expenses 5+6+7+8+9 27 850 30 570 33 820 34 780 36 550 37 250 48 210 58 430 60 410 65 180
10
11
Interests on credit
Credit pay-off
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
III Total financial expenditure 10+11 - - - - - - - - - -
IV Net revenue I-II-III - 25 650 - 27 970 - 32 040 -33 200 -34 790 - 36 150 -47 020 - 56 500 -59 100 -62 770
12
13
14
Expenses on investment
Dividends for shareholders
Awards and other payments from profit
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
V Total expenses at the discretion of the
company owner 12+13+14
- - - - - - - - - -
15 Revenue from financial instruments (credits) - - - - - - - - - -
VI Net funds IV-V+15 -25 650 -27 970 -32 040 -33 200 -34 790 -36 150 -47 020 -56 500 -59 100 -62 770
137
Teaching Negotiation Skills
University Model Based on Entrepreneurial Experience
Jerzy Rosi?ski (Ph. D.)
Jacek Klich (Ph.D.)
Institute of Economics and Business Management (Jagiellonian University), CITTRU
Poland, 31-387 Krakow, Gronostajowa 3
Fax: +48 12 664 69 14
Jerzy Rosi?ski: [email protected]
Jacek Klich: [email protected]
Keywords
Entrepreneurial competences, post-graduate teaching
Abstract
This chapter describes assumptions and the teaching process of the course on negotiation skills as run
at the Institute of Economics and Business Management (Jagiellonian University). Being one of the
most popular workshops of studies for a B.A. degree, it is also applicable in teaching entrepreneurial
competences (known as soft skills).
Standard teaching of negotiation skills revolves around one of four approaches. This chapter suggests
which of them should be given prominence and what is best order for other approaches application to
achieve the best results. The authors also present a methodological structure of classes and possible
applications of this approach to teaching other entrepreneurial skills.
1. Introduction to the model
This chapter presents a case study of a module of a course within a tertiary education curriculum at the
Institute of Economics and Management, which was founded in 1996 and presently employs 40
academic teachers. It is an organizational unit of the Institute of Management and Social
Communication at the Jagiellonian University.
As part of such a big organisation as a university,
1
the institute has the capacity to shape the specific
teaching style, characteristic of applied sciences. However, at the same time, it has to satisfy the criteria
of academic teaching. This causes a necessity of integrating academic knowledge with a practical
approach prevalent in business.
138
Znacz?ce
emocjonalnie
prze?ycie
Activity
Applying knowledge and skills to
specific situation (personal/corporate)
osoby / organizacji
Knowledge of the type:
‘How?’
How can I use what I have learned?
Knowledge of the type:
‘What?’
What does it mean for me?
What do I know?
Emotionally
significant
experience
Active
involvement
in a task
Personal insight
Deducting
(rules, models)
Planning
implementation
The breakdown of persons participating in the course (students) is determined by the organisational
positioning of the Institute at the University, whereby the students expect to obtain ‘more’ than a mere
economic perspective of entrepreneurship, and thus are more open to content pertaining to relational
elements (e.g. as described by social psychology).
The stakeholders of the course - similarly to the ever growing majority of students of entrepreneurship-
related departments of studies, expect quick-and-ready solutions, tools adapted to the reality of the
market. More so, they expect the persons running the course to shower them with examples of
entrepreneurial activities stemming from experience of the Polish market. This tendency permeates a
wider group of students, less inclined to spare no effort to learn things by themselves (through literature
and bibliography reading) and expect the trainer to provide a ‘prêt-a-porter’ product.
2. Description of the model
Teaching negotiation skills at the Institute of Economics and Management rests on certain assumptions
(presented below) that relate to specifically designed academic courses, yet may also prove useful in
teaching so-called soft skills, inherent in mastering entrepreneurship.
Assumptions:
1. Negotiation skills largely depend on personality traits (extroversion, flexibility, conciliatory
manner). However, it is not plausible to mould personality skills in a direct way due to their
formation
2
or specific position of tertiary education institutions in human development
3
.
2. Effectiveness of adult education hinges on class structure based on the assumptions of adult
learning as defined by D.A. Kolb (Rosinski J., Rychlicka A. 2001). As this is a widely recognized
theory (Senge P. et al. 2002), we will only limit ourselves to presenting relevant reflections
pertaining to teaching adults.
The D.A. Kolb cycle model comprises 4 stages of learning and the main thesis rests on the requirement
that all four stages of the process must be completed for the process to be effective (see: illustration 1).
Illustration. 1. Learning Cycle according to D.A. Kolb (the authors’ presentation derived from Senge P.
et al. 2002)
In the light of the above it transpires that classic models of academic teaching focus on reflection
leading to the formulation of a universal model, at often ignoring the question of application of the
uncovered rules, concentrating rather on explaining of the phenomena at hand and on predicting their
future form. Classic academic model validates less contribution on the part of audience in to process of
designating meaning, and does not recognize the need of employing emotions in the process of group
learning. The academic approach focuses on dissemination of specialist and fragmented knowledge. As
139
the concentration span of the teacher lasts only ¼ of the cycle (see: illustration 3A), this leads to
awarding students representing one type of learners (see: illustration 2) - assimilators
4
.
Illustration 2. Four-stage learning cycle of D.A. Kolb. (derived from Rosi?ski J. Rychlicka A. 2001)
This learning model for entrepreneurship seems distinct from the model preferred in academic learning
(illustration 3B). An efficient entrepreneur is expected to display traits and skills typical of persons
successfully holding sales-related positions (or in sales and marketing departments) and for those
people who function effectively in positions that require social dexterity (e.g. in public relations
departments). This way of functioning is characteristic of accommodator-type
5
(see: illustration 2) - the
type standing in contrast to assimilator type, which is preferred for traditional academic learning.
In other words, by applying the traditional model we ‘generate’ successive academics, whereas we have
obvious system problems with the efficient teaching of entrepreneurs.
Illustration 3. Learning cycle of D.A. Kolb: 3A – Assimmilator learning style; 3B – Accommodator
learning style
The dilemma may be resolved by incorporating the entire cycle of D.A. Kolb into academic teaching,
which makes the classes appealing to students of all four styles of learning, and provides ground for
development of every single learner’s potential, irrespective of their future career.
Concrete Experience
Abstract
Conceptualisation
Reflective
Observation
Active
Experimentation
Converger
Diverger
Assimilator
3A
Activity
Personal
reflection
Identifying regularities
(theory, model)
Planning
implementation
Planning
implemen-
tation
Activity
Personal reflection
Identifying regularities
(theory, model)
3B
Accommodator
140
For this kind of work to be possible the teacher has to be acquainted with theoretical models and be
able to present their personal and creative interpretation.
The teacher has to display an open attitude and be ready to experiment, not to mention the dexterous
use of didactic structures suitable for group teaching.
Another attitude relates to an openness to others (derived from an openness to experience and
flexibility) – which ensures effective performance ay that stage of personal reflection. Thanks to this not
only the group listens to the teacher (in stage 3 of D.A. Kolb cycle) but also the teacher is receptive to
learners’ reflections (in stage 2 of the cycle). Listening to the opinions of the group antecedes theoretical
and synthetic conclusion. It may seem obvious but still a great number of teachers adopt a position of
an omniscient person [besserwiesser] fearing the opinions of others.
An open attitude should go hand in hand with business implementation of skills needed in presenting
this kind of knowledge.
Illustration 4. Learning cycle of D.A. Kolb: planning teaching session accounting for all four types of
learning styles.
3. Description of the application of the model
The above assumptions concerning the specifics of entrepreneurship and learner attitudes are given
consideration in a 45-hour social communication and negotiation course completed by an exam. The
course is in workshop form and the classes are run in 6-hour blocks.
Besides fulfilling the above mentioned assumptions regarding teaching, it was crucial to adopt a
methodology suitable to specific subject matter. As negotiation may be understood in
a plethora of ways, a decision had to be made on one leading approach. Four fundamental approaches
to the issue of negotiation were derived from W. Mastenbroek (1996):
• process with clearly distinct stages
• as a set of guidelines and tactics
• as persuasive communication
• as the art of ‘marrying’ the opposites and resolving dilemmas
The opening stage of the classes is built around the concept of negotiations as the art of marrying
opposites. Such an approach reinforces the attitude of the person in the negotiation process
6
. Also it
enables the introduction of core theoretical notions (e.g. negotiation style, attitude to the situation of
negotiation, BATNA).
Activity
Personal
reflection
Planning
implementation
Identifying
regularities
(theory, model)
141
The next step is that of negotiation as a process. This approach allows the creation of a map of
understanding the negotiation as specific activities taking place in time, thanks to which the participants
understand their behaviours in a wider context (time, the sequence of events, interdependence of
actions).
Only when the participants have reinforced their personal resources and once they understand the
process, are they ready for information on persuasive negotiation and on the rules and tactics involved.
Each session
7
is thus constructed to include the entire D.A. Kolb learning cycle at least twice in a 6-
hour module. Every class starts with a game/ case study / experiment, which allows a start of the cycle
of adult learning (see illustration 2) from the stage of Active Experimenting
8
. The next stage (Reflective
Observation) allows to gather reflections upon the negotiation game. Often this stage takes on a form of
discussion between the persons in a group with the teacher, taking on the role of moderator in the
discussion.
9
The next stage is that of the conclusion of the discussion, conducted by the teacher
(Abstract Conceptualisation stage – see illustration 2). It is possible to make use of a prepared
presentation, however it is more useful to make a conceptualisation on the material provided by the
participants
10
. The winding up stage (Active Experimentation) may take the form of a moderated group
discussion or brainstorming (blue-skying) on the application or a short lecture of the trainer on the
application of the knowledge.
The choice of the form of closing the learning cycle depends largely on the experience of the group.
Namely, the groups characterized by low experience (students of the first years of university) welcome
ready ideas of knowledge implementation, whereas groups with more experience (students of final
years of university have certain experience of working in various organizations of this type) the more
positive reaction of the group when invited to share their experience or to use their experience to find
application of what they have learned.
Construction of a single session of the course
To exemplify this model we may consider one of the sessions early in the course. The classes
concentrate on understanding negotiation as a way of combining opposites and resolving dilemmas.
The learning cycle starts with the experiment of the type: Caring for your business based on W.
Mastenbroek's model. The next stages of learning use games relating to all four fundamental
dimensions (dilemmas) according to Mastenbroek. Upon completion of all the games, the integration of
the model (presentation) is carried out, after which the participants embark on games reflecting simple
integrational negotiation. The games provide feedback on individual negotiation styles. As a result, not
only do the participants’ behaviours improve but they also gain new knowledge.
The model under discussion was initially based on the basis of experience of business training. The
structures – tried and tested under market situations – were cushioned by methodological reflection and
successfully implemented into academic teaching. The authors experienced in the model may apply
teaching negotiation skills and various soft skills, not only during workshops classes in the tertiary
education. The model has been applied for perfectioning the competences of teams of small medium
entrepreneurships (SMEs) whereby the employees and employers alike engaged in the learning
process. The discussed approach stands the test in relation to teams of corporations. When applying
the approach one has to remember that:
1. in the case of small medium entrepreneurships (SME’s) it is advisable to consider separating the
owners from the learning group. The owners want to ensure their money is well spent. However
their presence may often paralyze unfettered group reflection and be detrimental to the learning
process. Paradoxically, the absence of the owner at the training makes it more viable.
2. In large corporations we often come across organizational barriers hampering implementation into
everyday life the substance learned during training. Therefore undertaking courses of action
according to the discussed model does not guarantee success. When preparing the classes one
142
needs to consider the aspects of the management culture that may hamper implementation of new
skills or favour old habits and attitudes. A typical example would be an attempt to change the
attitudes of salespersons in negotiations with clients in a situation where a commission system in
the company prompts the salespersons to close the deals swiftly and to get the largest number of
clients possible, without taking into account the profit made on an individual client.
Table 1. Workshop module layout
Learning cycle stage
Specific experience Reflective observation Abstract generalization Active experimentation
Timing
(minutes)
Negotiation game:
Stock Edelweiss
11
15
Discussion moderated
by the person who runs
the workshop
20
Mastenbroek Model:
elements of negotiator’s
behaviour that affect the
‘Looking after business’
dimension – a
multimedia presentation
15
Real life examples of the
behaviours increasing
‘Looking after business’
12
10
Closing the D.A. Kolb cycle
Result:
One of the negotiation’s dimensions is grasped: ‘Looking after business’.
This understanding is combined with adequate courses of actions and backed up by experiences from the participants own
lives.
Time
60 minutes
Negotiation game
‘Sharks’ Island’
20
Moderated discussion 20
Model of Mastenbroek:
elements of negotiator’s
behaviour influencing the
dimension: ‘Building
strength’ - multimedia
presentation
15
Real life examples of the
behaviours increasing
‘Building strength’
dimension
13
5
Winding up the cycle of D.A. Kolb
Result:
Dimensions of ‘Flexibility’ and ‘Atmosphere’ are introduced, alongside the adequate course of action, additionally combined
with participants’ own experience.
Time:
60 minutes
143
Negotiation game
„The Eggs of Dodo Bird’”
10
Moderated discussion 15
Model of Mastenbroek:
elements of negotiator’s
behaviour influencing the
dimensions: ‘Flexibility’
and ‘Atmosphere’ -
multimedia presentation
25
Examples taken from
real life and from
business
10
Winding up the cycle of D.A. Kolb
Result:
Dimensions of ‘Flexibility’ and ‘Atmosphere’ are introduced, alongside the adequate course of action, additionaly combined
with participants’ own experience.
Time:
60 minutes
Negotiation game
14,15
50
Small-group discussion
of the game outcome
16
15
Presentation of the game
results on the group
forum
17
15
Conclusions regarding
application of the
desirable behaviours
observed when playing
the game.
18
10
Closing the cycle of D.A. Kolb.
Result:
The participants of the classes receive feedback on their personal negotiation style (in the categories of Mastenbroek
model) and how it affects the negotiations outcome. The participants know what behaviours affect positively the outcome of
integrational negotiation.
Time:
90 minutes
The end of the classes
4. Description of how the model can be used by other institutions or in
other situations
Undoubtedly, any application of the model in non-academic organizations may entail the necessity to
change the proportions of the realization time: less time spent on the theoretical presentation at the
simultaneous increase of time spent on presenting practical application. However it is the authors’
opinion that it is more viable to adhere to the model presented in this chapter, as those in business
organizations need reflection of a more universal character. This reflection enables them to find by
themselves a wider range of application of knowledge and skills, whereas by providing them with long
lists of ready-made solutions we may curtail their creativity. Naturally, in the learning process, the
participants have to be presented with a certain number of possible applications and references to their
life. However - metaphorically speaking - some leavening is needed for the participants to bake bread
themselves. Presenting a long list of possible applications is like serving sliced bread in a packet. No
one is interested in baking their own bread when a ready-made loaf is at hand.
144
Bibliography:
1. Mastenbroek W. Negotiations, PWN, Warsaw 1996
2. Rosi?ski Jerzy, Rychlicka Anna (2001) „W stron? uczenia przez rozwi?zywanie problemów”
(Learning Through Problem Solving) in: Borkowski T. [ed.] „Dylematy kszta?cenia mened?erów u
progu XXI wieku” (Dilemmas of the Education of Managers at the turn of the XXI
st
century),
Wydawnictwo Akademickie, Krakow
3. Senge P. et. al. Pi?ta dyscyplina, materia?y dla praktyka. Jak budowa? organizacj? ucz?c? si?.”
(The Fifth Discipline. Practitioner manual. How to Build the Learning Organisation), Oficyna
Ekonomiczna, Krakow 2002
145
Footnotes:
1
Founded in 1364 the Jagiellonian University is the oldest Polish university, presently providing education to well over
44,000 students, employing 3605 academic teachers.
2
Personality traits are saturated with elements of genetic inheritance or social inheritance (time spent in the family of
childhood)
3
The character of objectives of the organization does not allow for the forms of development based on sociotheraphy or
psychotherapy.
4
Assimilator shows propensity for making theoretical models, converging observations into integrated explanations.
Practical implementation, or the ‘human’ face of project, are less important than logical and precise theory. Weaknesses
include: intense focus on models, at the detriment of reality check; low regularity; inability to learn from experience or to
draw conclusions from mistakes committed at the implementation phase. The assimilator style is an effective strategy of
behaviour in the areas connected with information and knowledge-sharing (Rosi?ski J., Rychlicka A. 2001)
5
Accommodator learning style is ‘hands-on’. A person with preference for this style of learning is best at implementing
plans and experimenting, at wholehearted personal commitment in new experience. The person is more prone to take
risk and derives pleasure from adapting to new situations. These skills are visible in profession requiring activity and
operational talent, e.g. marketing and sales. Advantages: ability to realize plans, leadership skills, risk-taking. The
shortcomings of the style include: acting for the sake being active, insufficient focus on goal, generating too many
insignificant solutions. The plans made by accommodator are not always realistic while the deadlines are not always
kept. (Rosi?ski J., Rychlicka A. 2001)
6
Thanks to this the participants identify with the subject at the start of the course, which allows to build and maintain
strong motivation for learning.
7
Irrespective of the adopted approach to negotiation.
8
Learning cycle may commence with any stage. It is important to go through all the stages of the cycle. Persons of
resource prefer to start from Active Experimentation, which additionally gingers up commitment in groups that are task-
oriented.
9
The emotions sparked by the game may be so intense that there is no particular need to encourage others to contribute
opinions, which are voiced freely upon completion of the task.
10
The summing up stage takes more time, is ‘less sleek’ than the presentation and requires more skills on the part of the
teacher (moderator of discussions) as well as knowledge on the subject (being flexible in reacting to the changes in
substance disclosed by the reflection of the participants). However, this way of acting shows the group that the earlier
discussion and reflections are valuable – not distinct from the presentation, providing ground for the conceptualisation.
11
Negotiation games were derived from the book by W. Mastenbroek (1996)
12
The trainer shapes the discussion by providing examples from his/her own life, and then invites the participants to follow
suit. Providing 3-4 personal examples ‘sparkles the fuse’ and ignites in participants the willingness to share their own
experience.
13
This element of the cycle does not require much time as the pattern of behaviour appeared in the earlier cycle of D.A.
Kolb and by now the participants are well aware of the desirable behaviours.
14
Negotiation game may concern any subject and the scenario and should fulfil the following criteria: possible integration
solution ( satisfying interests of both parties involved), the extend of potential agreement is relatively broad, the scenario
should contain 3-5 negotiation issues (e.g. item price, total purchase amount, pay-by date, after-sales guarantees,
timetable of deliveries).
15
The game should be played in 4-person teams, where two persons are negotiating and two are observers.
16
Discussion of the game is done in 4-person groups. The persons who were observers give feedback, by using the
categories of W. Mastenbroek model, i.e. ‘Looking after Business’, ‘Building Strength’, ‘Atmosphere’, ‘Flexibility’.
17
As the negotiation game provided a broad scope for integration agreement, it is possible to compose a ranking of the
achieved results and to establish what types of behaviour (within the model) led to the advantageous solutions.
18
Discussion concerns applications in subsequent negotiation groups, everyday life situations, business negotiations.
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