Entrepreneurship: Myth – Mindset - Mandate

Patricia McDougall-Covin, Ph.D.William L. Haeberle Professor of Entrepreneurship

University of PaviaOctober 2011

CongratulationsUniversità di Pavia

On Your 650th Year Anniversary!!!!

Outline• The Myths of Entrepreneurship• The Entrepreneurial Mindset• The Entrepreneurial Mandate

– Extend entrepreneurship education throughout the university

– Advance entrepreneurship as the world’s engine of economic growth and job creation

Entrepreneurship Education has achieved

“Remarkable Growth”

30 Years Ago

Only 6 universities conducting

entrepreneurship programs

Today

> 3,000 universities offer programs in entrepreneurship

E-Education is a FORCE!

The 1980’sEntrepreneurship’s Emerging Era

When the myths were exposed!

Exposing the Myths of Entrepreneurship

“Big risk takers ~ gamblers” myth

Exposing the Myths of Entrepreneurship

“All you need is luck” myth

Exposing the Myths of Entrepreneurship

“Most entrepreneurial initiatives fail” myth

Exposing the Myths of Entrepreneurship

“All you need is money” myth

Exposing the Myths of Entrepreneurship

“Entrepreneurs are born, not made” myth

Debunking Myths

"It's not magic; it's not mysterious; and it has nothing to do with

genes. It's a discipline and, like any discipline, it can be learned."

- Peter Drucker

The Real Lesson of the 1980’s

A Mindset Shift

From “Institutional” Relianceto

“Individual” Reliance

The Entrepreneurial Mindset

• Entrepreneurship is a perspective that has– revolutionized the way individuals think

and the decisions they make– revolutionized the way business is

conducted in every country

The Entrepreneurial Mindset• Is a dynamic process of vision, change, and

creation. • Requires an application of energy and

passion towards the creation and implementation of new ideas and creative solutions.

• Is the vision to recognize opportunity where others see chaos, contradiction, and confusion.

Adapted from Donald F. Kuratko, Entrepreneurship 8th, South-Western, 2009.

Everything is always impossible before it works!

That is what the entrepreneurial mindset is all about….. encouraging people

to do what is impossible.

Mandates• Extend entrepreneurial education

throughout the university• Advance entrepreneurship as the

world’s engine of economic growth and job creation

Mandate - University Education

Extend the “entrepreneurial mindset”

across the entire university

Entrepreneurship at Indiana University

Kelley School of Business (KSB) is the focal point of entrepreneurial education & engagement

Role is to create an entrepreneurial mindset throughout the campus

Kelley School of Business• First entrepreneurship course offered in 1959• Rankings among U.S. public universities:

– #1 Entrepreneurship Program (Fortune Magazine 2910)

– #1 Undergraduate Entrepreneurship Program (U.S. News & World Report, 2011, 2010, 2009, 2008, 2007)

– #1 Graduate Entrepreneurship Program (U.S. News & World Report, 2011, 2009, 2008)

Johnson Center for Entrepreneurship & Innovation

Cross-Campus Initiatives• JCEI Main Office – Kelley School of Business• Satellite Offices

– School of Law– Simon Hall Multidisciplinary Science Building– School of Medicine (located in Indianapolis)– IU Innovation Center

• Campus Collaborations– Jacobs School of Music– School of Public & Environmental Affairs– School of Informatics – Multiple Centers and Institutes

I.U. Law School

Elmore Entrepreneurship Law Clinic

JD & MBA students provide legal assistance to high potential companies & to faculty seeking to commercialize an innovation

Multidisciplinary Science Building •Dedicated to the emerging science projects emanating from the laboratories of I.U.’s top scientists

•Collaborative work between science & business students

Johnson Center for Entrepreneurship & Science Innovations

Johnson Center for Entrepreneurship & Medical Science Innovations (JCEMSI)

Indianapolis Campus

Located in I.U. Research & Technology Corporation, near I.U. Medical School

Focuses on the commercialization of the medical life sciences developments of the physicians & researchers at the I.U. School of Medicine

IU Innovation Center (Hoosier Hatchery)

>2,000 square feet of space for students working on new innovations with commercial potential

Jacobs School of Music•Johnson Center for Entrepreneurship & Cultural Leadership (JCECL)

•Educate music students on entrepreneurial principles as many music students will be using their special talents on their own

School of Public & Environmental Affairs

Social Entrepreneurship Certificate Program

• Offered to business & SPEA students

• Includes internships in non-profit & for-profit companies in social entrepreneurship

Indiana University’s Vision

The Entrepreneurship Campus of the 21st Century

Mandate – World’s Economic Engine

• Throughout the world, entrepreneurial firms are increasingly looked to as the major potential source of innovation, employment, and economic growth

• Entrepreneurial firms are the engines of economic growth and job creation; which in turn, are believed to be the underpinnings of political stability

• Entrepreneurship empowers women and youth

Social Entrepreneurship – Combining Social Values, Profit Motives & Global Focus

Muhammad YunusNobel Prize Winner, 2006

Micro Financing

Mandate – World’s Economic Engine

Entrepreneurial firms are now part of the

international marketplace

International Business Focus – Up to mid 1990s

Source: Adapted from Shaker Zahra presentation, AIB Conference, Sweden, 2005.

Stage Theory

Dominated

The

Literature

Source: Shaker Zahra’s presentation slide, AIB Conference, Sweden, 2005.

The New World of International New Ventures

Source: Adapted from Shaker Zahra’s presentation slide, AIB Conference, Sweden, 2005.

Born Global• Founders

– Piereluigi Zappacosta (Italian)– Daniel Borel (Swiss)– Giocomo Marini (Italian)

• Acquired rights to sell a Swiss-designed optomechanical cursor control (mouse)

• Incorporated in Switzerland in 1981 and in the U.S. a few months later

• Manufacturing and marketing operations in Switzerland, Taiwan and U.S.

• By 1990, had captured 35% worldwide market share of OEM market and 27% of the worldwide retail market for the mouse business

Met while studying engineering at Stanford University

Key Drivers of Emergence of Born Globals• Technology- easier, faster, cheaper

– Fax– Satellite communications– Internet

• Transportation – faster, more efficient, cheaper– Containerization of freight– Air travel prices

• Crumbling trade barriers• Globalization of markets –convergence of buyer

preferences and lifestyles worldwide

The Internet makes business through virtual markets possible anytime and anywhere!

International New Ventures/Born GlobalsAre Different from Multinational Enterprises

• NVs face liabilities of newness (Stincombe, 1965)

• Survival is a critical issue for NVs• For NV, a misstep in international arena may

mean death because of lack of slack resources• NVs enjoy learning advantages of newness

(Autio, Sapienza & Almeida, 2000)

Learning Advantage of Newness (Autio, et al., 2000)

As firms become larger & established -- develop routines, procedures & structures

New firms -- flexible & open to international opportunities

Who wants to be an entrepreneur and sell in

the international marketplace?

Eurobarometer Survey on Entrepreneurship(2009)

• Preference for self-employment – Europeans

• 45% of all Europeans would like to be self-employed • 49% would prefer working as an employee.

– Chinese has the strongest preference for self-employment (71%), – Japanese have the weakest preference for self-employment (39%)

• Favorable image of entrepreneurs– United States 73%– Europe - 49%– China - 40%– Japan - 32%– Korea - 30%

What Does Research Tell Us?• Global Vision• International experience• Global networks• Primarily technology-based or knowledge

intensive firms• International knowledge can be sourced

externally—VC, alliances, proximate firms• Geographical location matters

The Power of Entrepreneurship• The phenomenon we are witnessing today

has less to do with risk-taking than with the simple observation that people, not institutions, create change.

• In this respect, perhaps our entrepreneurs are leading our nations to a rediscovery of business as a process limited only by the boundaries of each individuals intelligence, imagination, energy, and daring.

“One of the five most beautiful campuses in the U.S.”Thomas GainesThe Campus as a Work of Art

Questions?

Grazie