Understanding the Educational Needs of Small Business Owners

INTRODUCTION In today's competitive market environment running a small business professionally isn't just a good idea, it's a requirement for survival (Ehrenfeld, 1995). While small account for 97% of U.S. enterprises and 58% of the workforce (Keats and Bracker, 1988), many are struggling to transform themselves in the face of their larger competitors (Ehrenfeld, 1995). In an effort to strengthen themselves against growing competition, small business owners look to a variety of sources. One important source of professional training for small is colleges and universities. However, in a study conducted by the National Federation of Independent Businesses, small business owners ranked college or university teachers last on a list of five potential sources of management advice, in terms of trusting their advice to be helpful (Jagemann, 1990). The purpose of the present research was to examine the reported needs of small business owners, and to use that information to help determine how a regional university in a metropolitan setting might best meet the needs of current business owners and train students who are preparing for the small business workforce and ownership. This paper suggests that the development of a client based small business education program can enhance the perceived and real effectiveness of such programs. SMALL BUSINESS SUCCESS AND FAILURE In the U.S., it has been reported that 734,000 new companies were created in 1992, while 137,000 were taken over by existing and more than 800,000 discontinued operations (The State of Small Business, 1993). Additionally, small business has created almost all new jobs in the U.S. from 1989 - 1990 (Kirchhoff, 1994). Because of the critical nature of small business to the U.S. economy, it is important to better understand what has led to success and failure in the small enterprise. A corresponding body of literature has emerged and examined success and failure in the small enterprise (Gaskill, Van Auken, and Manning, 1993). While the literature in this area has been diverse, the studies have revealed some strikingly similar conclusions. The first commonality is that small are not just miniature versions of large businesses but are unique entities and there is merit in examining performance, success, and failure in small firms separately from their larger counterparts (Keats and Bracker, 1988; Robinson and Pearce, 1984). Second, small firm performance has been linked to a number of individual and firm characteristics. Many of these characteristics are areas which are commonly part of university training programs for small business. For example, Keats and Bracker (1988) suggested that small firm performance is influenced by six constructs: 1. Entrepreneurial intensity: entrepreneurial characteristics and behaviors which differentiate entrepreneurs from other individuals; 2. Task motivation: intensity of motivation to attain goals; 3. Perceived strength of environmental influences: strategic choices in response to the relevant environment; 4. Behavioral strategic sophistication: acquisition and implementation of strategic management tools and practices; 5. Cognitive strategic sophistication: comprehension and integration of strategic management practices; and, 6. Task environment factors: structure of the relevant industry. While a limited number of business schools offer insight and instruction geared toward the development of the entrepreneurial attributes identified in the first two of the six characteristics, virtually all university business schools train students in the basics of strategic management and environmental monitoring (the last four of the six concepts). Larson and Clute (1979) identified several characteristics shared by failed firms, including managerial deficiencies and lack of financial planning and analysis. …