published Friday, June 6th, 2014

Colleges bureaucracies struggling to embrace entrepreneurial spirit

Bill Gates, Steve Jobs and Mark Zuckerberg dropped out of college and created billion-dollar businesses.

Those three billionaires may be the exception to the rule, but the fact remains millions of U.S. students finish college every year, only to graduate into the swelling ranks of the unemployed and underemployed.

Colleges don't want to be irrelevant, but some officials worry that universities, tech schools and community colleges are struggling to help mold the next Ted Turner, Walt Disney or Oprah Winfrey -- all three of whom dropped out of school to pursue success.

That's why there's a push underway for colleges to take the lessons learned by entrepreneurs and apply them to the classroom, creating the next generation of tycoons instead of merely growing a new crop of job-seekers.

It's a fight between rules, curriculum and standards on the one hand; and freedom, disruption and new orthodoxy on the other.

"The only way that I believe you learn entrepreneurship is you stick somebody in the seat and light the rocket," said John Morris, president and CEO of Tech 20/20, a regional business accelerator. "Curriculum education tends to be proscribed. Entrepreneurship is not defined by steps, you've got to define the next step. That's the only way you learn what the next steps are."

Take traditional MBA students, for example. A masters in business administration is prized among those in the corporate world as the holy grail of education achievement for those pursuing a career in commerce.

But Holly Hanson, director of the Cumberland Business Incubator, said the modern MBA is not necessarily the right path for an entrepreneur. At a panel of the Tennessee Valley Corridor summit held at UTC Thursday, Hanson argued that a course on how to start a new company must differ substantially from a traditional business education.

"What I find with the MBAs who come in [to the incubator] to find out about how to start a business is that they didn't learn a thing about starting a business, they learned how to be excellent employees in firms, how to measure risk and minimize risk," Hanson said. "Those entrepreneurs who are risk takers are the ones who do better, overcoming all those obstacles that the MBA pointed out they're going to see."

State labor officials across the U.S. are finding that even as college enrollment has risen, the number of new businesses in the pipeline has fallen, Hanson said.

However, officials are far from nailing down a solution to fix the country's entrepreneurship deficit, nor is there agreement on how far or how fast colleges should rush in the race to attract and train entrepreneurs. In some cases, university system officials themselves could be the ones holding up progress at the local level, said Jim Catanzaro, president of Chattanooga State Community College.

"I think unfortunately, higher education solutions are held captive by the political system," Catanzaro said. "The Tennessee board of Regents, or University of Tennessee board, the accrediting associations, they all see the educational world ... in lockstep development of curriculum, and they see students who drop out and start a business not as a success, which is a mistake."

Catanzaro has attempted, for instance to add dormitories to the campus of Chattanooga State to allow high-performing students to bump into each other in halls, hang out after class, and perhaps craft the makings of the next big thing.

But the Tennessee Board of Regents shot down the idea, saying that there shouldn't be dorms at community colleges.

"The people who run these organizations are often people who are themselves not entrepreneurs ...they're the opposite," Catanzaro said. "We need folks who are good bureaucrats, but we don't need them running institutions."

But though university systems, like all bureaucracies, are slow to change, officials have started to take notice of the trend toward liberalizing education, said Chris Whaley, president of Roane State Community College.

"We talk about not holding those folks back who have that spirit, that mindset, and I think things are changing that are going to allow us to think more outside the box, help us change the culture," he said.

Perhaps the first step for colleges to embrace the business world could be through the use of laboratories, or lab classes. Instead of measuring the effect of smashing one molecule into another or pouring acid on rocks, students could learn entrepreneurial concepts in a less standards-driven, curriculum-dependant environment.

That type of approach could combine the strengths of universities with the strengths of the startup world, said Phil Oldham, president of Tennessee Tech.

"I'm convinced the creativity is there, the energy is there, we've just got to run through the boundaries and let it happen," Oldham said. "I think the one thing of many things universities are really good at is creating ideas. How do you exploit that? How do you encourage that? We're coming to the point where creativity is not so much something that happens in the classroom as it does out of the classroom."

Contact staff writer Ellis Smith at 423-757-6315 or esmith@timesfreepress.com with tips and documents.

about Ellis Smith...

Ellis Smith joined the Chattanooga Times Free Press in January 2010 as a business reporter. His beat includes the flooring industry, Chattem, Unum, Krystal, the automobile market, real estate and technology. Ellis is from Marietta, Ga., and has a bachelor’s degree in mass communication at the University of West Georgia. He previously worked at UTV-13 News, Carrollton, Ga., as a producer; at the The West Georgian, Carrollton, Ga., as editor; and at the Times-Georgian, Carrollton, ...

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