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The entrepreneurial approach: entrepreneurship holds the power to transform education. The tough question? Is the risk of sticking with the current system greater or less than the risk of innovation?

Entrepreneurship may be one of the least understood and potentially beneficial concepts to hit the educational landscape in recent decades. Before schools can gain from entrepreneurship, administrators need to grasp its significance.

Entrepreneurship and education have always been intertwined, but the relationship is evolving. "The fundamental difference with new entrepreneurship is that today's organizations aim to provide services that had been the exclusive province of public schools," says John Chubb, CEO of Edison Schools. In the past, entrepreneurs played support roles like providing textbooks or computers. The move to direct involvement in personnel and instruction has ignited some controversy.

At the most basic level, entrepreneurs and administrators operate with a similar aim: to improve education. Entrepreneurs, however, travel a different path to the end goal. "Entrepreneurs are folks who pioneer and promote fundamentally different approaches and methodologies to achieve sustained efficiency and productivity gains. Entrepreneurship transcends changes in curriculum or pedagogical approaches," explains Frederick Hess, director of education policy studies at American Enterprise Institute.

The entrepreneurship umbrella covers items like new thought processes and district business models. Familiar examples include supplemental service providers, charter schools and alternative licensure programs. Changes in the student/ teacher ratio or different textbooks simply don't meet the sniff test.

Joel Klein, chancellor of New York City Department of Education, links entrepreneurship and innovation. "Public education lacks a system to support and reward innovation. We need a system and process to test ideas and see what is done right and what can be improved." Entrepreneurial organizations like Teach for America and KIPP Academies offer new models.

Joining From the Outside The common thread among entrepreneurial initiatives seems to be that most entrepreneurs originate from outside the traditional district structure. Can entrepreneurship develop in a conventional district structure? "Internal efforts at school turnaround are incredibly hard [because of bureaucracy]," admits Kim Smith, executive chairman of NewSchools Venture Fund.

Outside organizations that aren't restricted by district regulations or a commitment to the status quo model may be able to initiate novel, effective solutions. For example, most districts rely on alternatively certified teachers as a backfill for open positions. The New Teacher Project promotes a different model, showing districts how to aggressively attract and support the best and brightest non-traditional teaching candidates. Such entrepreneurs operating outside of the district have the freedom to tackle problems differently and with fewer constraints.

But an us/them take on entrepreneurship may be a bit narrow. The New Teacher Project aims for a collaborative model with its programs viewed as district initiatives.

In Washington, D.C., schools, the D.C. Teaching Fellows program operates as a hand-in-hand partnership between The New Teacher Project and district staff to recruit talented professionals to teach in the city's schools. And Klein, who touts the New York City Department of Education as the nation's most charter-friendly district, says the district's charters are not outside of the system. Instead, charters are integral to the school system.

Another common misconception about entrepreneurship is that only for-profit entities are entrepreneurs. A number of non-profit entrepreneurs like The New Teacher Project provide services and a source of innovation.

Educational Entrepreneurship

Educational entrepreneurship may seem like a stark contrast to traditional school operations. Conventional wisdom pegs school improvement as a labor-intensive, complex task with most gains derived from professional development, curriculum alignment and formative assessment. "This traditional model of school improvement is limited," opines Hess.

Entrepreneurs, on the other hand, view education as similar to other activities. "There is room to find efficiencies, to substitute technology for parts of jobs and [develop creative solutions]," continues Hess.

Hess uses the automobile industry as an example. If the government had limited the automobile industry to two of the 50 or so competing manufacturers in 1910 it could have lessened the variability in quality and prevented downstream job loss in the long run. On the flip side, hundreds of features and productivity improvements would have been lost due to the lack of competition in the industry.

One hitch with entrepreneurship is its messiness. "The risks of entrepreneurship are pretty significant. Some entrepreneurial schools won't make it. Some approaches are a bad idea. In fact, most models will fail or lose money," admits Hess. "With any innovation, the district runs the risk that it won't succeed," adds Klein.

With such high stakes why should the average administrator consider entrepreneurship? The lack of true innovation cripples public schools, argue advocates for entrepreneurship. The system is plagued by mediocrity and even pockets of failure, notes Hess. "For too long, too many kids have not gotten the education they need. Education will stagnate without innovation," continues Klein.

Improvement Plans

Entrepreneurs cannot guarantee success, but an entrepreneurial climate can create room for smart, hungry educators with plans for improvement. In an ideal world, entrepreneurship serves as a laboratory to test new ideas with entrepreneurs sharing best practices with their public education colleagues. The tough question? Is the risk of sticking with the current system greater or less than the risk of innovation?

The entrepreneurial model doesn't accept KIPP Academies or another successful model as the end product or solution. Instead, it embraces the processes of competition and innovation. Every year new entrepreneurs compete with KIPR learning from and building upon its success and perhaps putting other entrepreneurs out of business. In the long run, the entire business of education benefits from the raised stakes. "All of the payoffs with entrepreneurship are realized the day after tomorrow," explains Hess.

Chubb outlines a few shorter term gains associated with entrepreneurship. One of the most significant outcomes is the energy and interest it brings to the education arena. For example, Teach for America has inspired close to 20,000 recent college graduates to commit to teaching in urban and rural school districts. Also, more than 10,000 alumni of the program continue to work toward educational excellence and equity.

Similarly, New Leaders for New Schools attracts new people to urban education. Entrepreneurial organizations also provide career opportunities for people interested in education who don't want to work within a district or state systems.

Finally, entrepreneurs bring new money to public education. "Entrepreneurs attract funding. Philanthropists that wouldn't donate money to public education do invest in non-profit entrepreneurs," claims Chubb. Similarly, investors are willing to bankroll new businesses with promising educational agendas. Edison illustrates the point. The organization has raised nearly $750 million in the last 15 years. All of the funds have been directed to public education.


Education is a high stakes business, and operating within the current framework is certainly comfortable. But some administrators and educators are ready to shake things up. While innovation does not translate into success, districts can develop plans to up the likelihood of a winning venture.

* Lose the us vs. them mentality. Instead of looking at entrepreneurs as threats to public education look to them as a source of solutions. Almost all entrepreneurs view public education as its customer base; they cannot succeed without public education partners. "Look at the new ideas offered by entrepreneurs and see if they can help solve specific problems in your district," adds Chubb.

* Become an informed consumer. Learn about district needs and communicate them to entrepreneurial organizations that can develop tools and solutions, recommends Smith of NewSchools.

* Complete a make vs. buy analysis. Education has evolved into an incredibly complex and demanding business. It's difficult, and perhaps impossible, for an individual district to effectively and efficiently tackle the entire job. Focus your expertise, recommends Smith. When does it make sense to go outside of the system to find a better widget? When does it make sense to rely on internal expertise?

* Remember that other school systems can provide another source of innovation. "I would like to learn from other systems," notes Klein.

* Don't get into initiative overload or lose focus. Start with one or two challenges or projects, and focus on developing a process and system for improvement, says Michelle Rhee, president and CEO of The New Teacher Project.

* Strike a balance. Have good internal people in collaboration with the entrepreneurial organization, advises Rhee.

* Develop and implement a system of accountability. Use this system to objectively measure an initiative's value.


The automobile industry may provide another useful analogy, claims Chubb. Thirty years ago, when oil and gas prices first shot up and environmental concerns emerged, the government responded with regulations, U.S. automakers reacted by calling in lawyers to oppose the regulations. Japanese automakers, on the other hand, charged their engineers with making better cars aligned with the new business and regulatory model. Today's administrators may face a similar choice. They can resist entrepreneurs, or they can use them as partners for new models to improve the business of education.

en-tre-pre-neur n.

A person who organizes, operates and assumes the risk for a business venture.

Lisa Fratt is a contributing editor.
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Author:Fratt, Lisa
Publication:District Administration
Geographic Code:1USA
Date:Feb 1, 2006
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