Apple Computer: The legendary Homebrew Computer Club, whose members included Apple founders Steve Jobs and Steve Wozniak, shared characteristics as well as personnel with an earlier project called the Midpeninsula Free University (MFU), a "radical alternative education" experiment in the Palo Alto, Calif., area. The freewheeling format of Homebrew's weekly meetings, modeled after similar MFU gatherings, led to numerous innovations and partnerships. It may have been the excruciating experience of producing MFU's course catalog on equipment not much better than a typewriter that drove Larry Tesler, now Apple's vice-president for Internet platforms and chief scientist, to develop bit-mapped graphics, the desktop-publishing breakthrough that was to become a centerpiece of Apple's Macintosh computer. Apple now has roughly 15,500 employees; sales exceeded $11 billion in 1995.
Kinko's: With 23,000 employees and 800-plus locations in the United States, 10 in Canada, 5 in Japan, 2 in the Netherlands, and one in South Korea, Kinko's is the world's largest chain of copy centers. The company was founded in 1970 by University of Southern California student Paul Orfalea, who obtained a $5,000 loan from the Bank of America and opened his first shop in a former hamburger stand in Isla Vista, near the University of California at Santa Barbara. The first store, named for Orfalea's trademark curly hair, was so small that Orfalea had to wheel the copy machine out to the sidewalk to make copies. Ten years later Kinko's operated more than 80 stores, located primarily near colleges and universities, where the company -- which also pioneered round-the-clock hours in its industry -- specialized in publishing custom materials for the academic market. Today Kinko's calls its stores, which now average 7,000 square feet, "the new way to office" and offers such services as digital color copying, hourly personal-computer rentals, and videoconferencing.
THE COMING B-SCHOOL SHAKEOUT
Does the growing demand for entrepreneurial education spell trouble for the big-name business schools -- and opportunity for programs trying to overtake them?
Our business is no different from any other," says Joseph Morone, dean of the Lally School of Management and Technology at Rensselaer Polytechnic Institute, in Troy, N.Y. "You've got entrenched players, and once the environment starts to change, that creates opportunities for other players. There's a big opportunity out there right now. We're at the front end of a major period of shakeout. Some business schools, as in any industry shakeout, are changing faster than others."
And as in any industry shakeout, change may be toughest at the top. Despite widespread shifts in the economy, the elite schools still see their reputations as being tied to the traditional goal of turning out graduates who go on to Wall Street, nationally known consultancies, and large corporations at which they are paid high beginning salaries. Many of the better-known rankings of business schools reinforce those old values. The median starting salaries of graduates, for instance, weigh in strongly on some rankings, as do the opinions of recruiters from large corporations -- hardly measures of any relevance to the increasing number of students looking to start companies, not careers.
While many deans and faculty members quibble with the details of the methodology used in the rankings, few deny their eagerness to have their schools be among the chosen. Even the most prestigious schools are not immune. "Over the last five years there's been a great deal of anguish and ferment at Harvard because of its declining ranking," says Jeffry A. Timmons, who formerly held a joint appointment at the Harvard Business School and Babson College, in Wellesley, Mass. (Timmons left Harvard in 1994 and is currently the Franklin W. Olin Distinguished Professor of Entrepreneurship at Babson.) "The bottom line," says Timmons, "is that the marketplace does pay attention [to the rankings]." Unfortunately, that means schools may give entrepreneurial education -- and the goal of sending grads into businesses of their own -- short shrift.
That's not to say that the brand-name business schools have ignored the growing interest in entrepreneurship -- it's just that there are established institutional forces stacked against serving it well. Though you'd be hard-pressed, for instance, to find a major school that hasn't started an entrepreneurship program of one sort or another, the programs and their champions are treated like second-class citizens. "The response to student demand has been to staff entrepreneurship programs with seasoned practitioners -- individuals who generally are not given academic recognition and certainly do not have substantial influence on defining a broader curriculum in response to student needs," says Robert S. Sullivan, who left the deanship at Carnegie Mellon University's Graduate School of Industrial Administration in May 1995 to take over the helm of the much smaller IC2 Institute at the University of Texas. "Existing curricula," Sullivan says, "represent the interests of tenure-track faculty."
Morone agrees, citing "the tyranny of disciplines." He explains: "The way you get ahead in academia is by establishing yourself in a network of professionals in your discipline. When a field or a problem area comes along that cuts across disciplines, as entrepreneurship does, there's no natural home for it in the university. It runs against the grain of the very well entrenched disciplinary reward structures."
With the elite business schools tied to tradition, the slack is being taken up by schools that don't have the high rank or Wall Street feeder system that a dramatically new educational approach might jeopardize. They see an opportunity to focus scholarship on the real-world problems of new businesses. "That requires stepping out of the box," says Sullivan, "admitting what we don't know, and creating new learning methodologies for understanding start-ups."
