Teaching people how to be entrepreneurs is in vogue at business schools these days.
Across the country, colleges and universities are scurrying to create entrepreneurship programs as traditional MBA offerings like finance lose some of their luster.
But what about teaching people who already are entrepreneurs?
Small business owners continue to be the country’s economic engine, but the percentage of them who pursue MBAs is nominal compared to recent graduates or executives from larger corporations, according to local educators. Not surprisingly, colleges and universities haven’t aggressively recruited small business owners to MBA programs, local experts say.
It raises the question: Does getting an MBA make sense for small business owners?
The simple answer: It might, especially if you’ve run a small business that has struggled making it to the second stage, where you’ve made it past the startup phase but haven’t yet grown to maturity.
Many small businesses get started because the owner is good at something like building websites or cooking or engineering parts. But many of them stumble when it comes to the other fundamentals of running the business like sales, accounting and managing people.
“A lot of very bright people get into a small business because they have a specialty and do something very well, but they don’t have a balanced repertoire [of business skills],” said Frank Novakowski, associate dean of Davenport University’s Donald W. Maine College of Business.
An MBA can help small business owners find balance, he said. Business school provides foundational knowledge on everything from bookkeeping to marketing strategy to operations management, Novakowski said. It can also help you build a personal network and dig into current thinking on how technology, software and the Internet are changing industries.
There are certainly plenty of choices for small business owners: In all, more than 20 Michigan-based schools offer part-time or executive MBA programs for working professionals. Grand Valley State University, which offers full- and part-time MBA programs, is working on a new executive MBA program, according to the business school’s associate dean.
These days, many of the foundational courses you’ll take in an MBA program can be found online. The emergence of no-cost massive open online courses (MOOCs) has spawned startups like Palo Alto, Calif.-based Coursera, which offers more than 500 courses from 107 partner schools around the world. The company claims more than 5 million students with computer science, business, economics and finance offerings among the top courses.
Likewise, some of the country’s prestigious B-schools, including the Stanford Graduate School of Business, University of Virginia’s Darden School of Business and Michigan’s Ross School of Business have begun offering some of their courses for free via the Internet.
While free is a great price, sitting in front of a computer monitor may not be a practical way for all small business owners to absorb useful information and turn it into action items.
“The thing about the Courseras and the MOOCs, they are abundant, but never has there been such a demand on time [for small business owners],” Davenport’s Novakowski said. Because small business owners get pulled in so many directions, sometimes the structure and investment in a formal MBA program provides the discipline and incentive to make the most of it, he said.
Formal programs also provide a support network. Since they lure a broad array of professionals from different industries and business disciplines, “the cohort” — as it’s called in grad-school speak — often ends up serving “kind of like an executive board or brain trust” for the business student, said Bridget Eklund, regional marketing and admissions representative at Northwood University, which offers a 24-month MBA program for executives and business owners in Grand Rapids.
“Students like the idea of discussing their business problems in an open forum where other people with different experience can chime in,” she said.
In addition to networking, the region’s MBA programs are very strategy heavy and, in recent years, have increased their emphasis on experiential learning, according to local experts MiBiz spoke with.
That means providing students with hands-on exposure to real-world business situations outside of the classroom and integrating the “lived experiences” of executive students into their learning.
Guest speakers, business roundtables, discussions of Harvard Business Review case studies and cohort group projects provide additional structure and community that online and MOOC courses typically lack.
“Everything we teach is applied learning,” Northwood’s Eklund said. “Everything they learn in class … they can apply the next day.”
When determining whether or not an MBA makes sense, experts suggest you should thoroughly evaluate your company’s specific needs and market opportunities, as well as your own skill sets, deficits and personal interests and values.
Spring Arbor University, for example, offers an MBA program that includes traditional business coursework and entrepreneurial leadership, as well as the integration of faith-based learning. The 36-credit hour management program, which is available at the school’s Grand Rapids campus, targets students who want to “strengthen [their] business acumen within an ethical and Judeo-Christian learning community,” according to the school’s MBA website.
For some small business owners, an MBA program might also provide deeper insight and networking into emerging business sectors or trending issues in the local economy. Several local colleges have added master’s programs in recent years that directly address these areas of growing interest.
Grand Rapids-based Aquinas College, for example, offers a master’s program in sustainable business. Launched in 2010, the program reflects the growing interest in sustainability among large local corporations as well as their suppliers.
Several West Michigan schools — including Muskegon’s Baker College, Cornerstone University, Davenport and GVSU — offer management MBAs focused on another of the region’s burgeoning industries: health care.
Still others offer highly technical master’s programs that address specific business disciplines such as Central Michigan University’s MBA programs in logistics management and enterprise resource planning (ERP). Both are offered at CMU’s Grand Rapids campus.
Drilling down into what a small business owner or his company needs can help you decide what type of local program would offer the best fit. Ask trusted advisers like your attorney or accountant to help you identify gaps that you might want to address, experts say.
“Sometimes it’s just knowing what you don’t know,” said Sridhar Sundaram, associate dean of GVSU’s Seidman College of Business. Many small businesses fail because the owners don’t recognize the gaps in their skill sets or changes in the marketplace or technology, he said.
Even so, “not all businesses need an entire degree program,” Sundaram said. In response, GVSU has taken a “dual approach” to continuing education for entrepreneurs and business owners.
GVSU offers a part-time MBA program for experienced owners and managers who have technical skills but need to develop their business skill set. In many situations, though, business owners and their key employees have specific issues like leadership or technology that need to be addressed. For those situations, GVSU offers a variety of non-degree or certificate programs, as well as workshops. That allows the school to address the company’s larger needs.
“Sometimes you may have an owner that goes into the MBA program and 20 employees attend a certificate program,” he said.
In any case, measuring the ROI of an MBA program is probably more qualitative than quantitative, Sundaram said. Certainly, if you’re the boss, there likely isn’t a pay raise or promotion that comes with completing a program. But there is something that every small business owner can appreciate: the avoidance of pain.
“The school of hard knocks does teach you, and you learn a lot,” said Davenport’s Novakowski, who acknowledges there are plenty of other ways to expand your horizons as a business owner, including business roundtables, MOOCs and trade associations.
“It isn’t that, intuitively, you can’t pick it up,” he said. But with an MBA program, “you can probably do it with a lot less pain.”