I worked for another organisation for a couple of years after graduating from the Indian Institute of Management (IIM), Bangalore, before I branched out on my own. I firmly believe that the conceptual component of a management education is above reproach "" my MBA opened me up to what business and management is all about. Otherwise, I would have been just another incompetent engineer.
But perhaps the biggest change it wrought was attitudinal "" an MBA instils self-confidence. I am a first-generation entrepreneur, but I wasn't too worried about the risks I was taking.
That's because a management degree "" especially one from a reputed institution "" gives you a sense of security. I had qualifications, so if things didn't work out, I could always go back to the career of my choice.
Of course, you can have too much of a good thing. It's the same with managers "" they're so intent on safe management practices, they're not really willing to try strategies no one else has done before.
Management as practised by MBAs is all about minimisation of risk, not maximisation of opportunity.
Also, and this is especially true from the entrepreneurial point of view, an MBA does not give you adequate grounding in operations. When you set up in business on your own, you need much more than textbook learning "" but your degree doesn't teach you to look at overdrafts and financing options and the like.
People skills "" hiring the right staff, managing teams and motivating them "" is another underrated aspect of running a business. How to evaluate the facilities available to you, how to correctly structure debt and equity in your organisation "" I believe that you truly realise the need to be skilled in these areas only when you venture into your own business.
What's the solution? It would be a great idea if B-schools started courses on practical entrepreneurship "" the day-to-day issues that crop up when you establish your own business.
Perhaps this learning shouldn't be included in the main course "" it will be seen as so much unnecessary coursework. Besides, ideas of entrepreneurship are still not well developed at most MBA courses.
The core audience for such a course would be, not fresh executives, but alumni of these institutes who want to branch out on their own. Most executive development programmes at present are geared towards the corporate sector "" there's little that benefits would-be entrepreneurs.
A management degree teaches you to manage processes, systems and ideas. It gives you a way to weigh options and choose the one that does the least damage.
Perhaps corporate organisations welcome people with such skills, but they're of not much use to entrepreneurs.
Apart from a course that teaches practical entrepreneurship, another suggestion to encourage the entrepreneurial spirit is to identify them early on "" at the selection stage to the course itself. Perhaps the IIMs should consider taking on as students those who attempt all the two-mark questions in the entrance examination.
Remember, this test includes negative marking, so anyone who attempts all the questions "" even though he may not know all the answers "" is already demonstrating his ability and willingness to take risks. Such a person may not necessarily shine in the corporate arena, but he has all the markings of a good entrepreneur. And that should be encouraged.
(Prahlad Rao is managing partner, Team Value Profiling Services. He graduated from IIM, Bangalore, in 1987)
