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Role of Management Education in Promoting Entrepreneurship in the

Globalised Business Environment

Article · January 2016

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Role of Management Education in Promoting Entrepreneurship in the Globalised Business
Environment

Mohamed Ismail Mohideen Bawa

Senior Lecturer in Management, Department of Management, Faculty of Management and
Commerce, South Eastern University of Sri Lanka, Oluvil, Ampara District, Eastern Province,
Sri Lanka, Contact Number: 0094 77 69 444 77, E- mail: mbmismail@seu.ac.lk

Abstract
Management education plays vital role in promoting entrepreneurship almost in countries. All
around the World many countries have taken various initiatives to promote entrepreneurial
activities. Indian Institutions also promote entrepreneurship. Objectives of this study are to know
the factors of management education & promotion of entrepreneurship and the relationship
between management education & promotion of entrepreneurship. Factors for Management
Education are industrial visits, curriculum, management games, assignments, learning sessions,
EDP Cell in the College, local industry connectivity, interactions with successful entrepreneurs,
project management, case method of learning, number of management Universities, management
colleges, management Institutes, number of management degrees, quality of management
degrees and number of management teachers. Similarly, factors for promotion of
entrepreneurship are fragmented policy & policy implementation, adequate funding of R & D,
ease of funding procedures, availability of venture capital & seed funding, strong linkages
between stakeholders, conducive education system, improved infrastructure facilities in villages,
risk-taking among entrepreneurs and adequate protection of intellectual property rights. This
study considered 101 respondents who are passed out students of Diploma holders, BBA holders
and MBA holders. Study collected data from primary source. Instrument for collecting data is a
simple questionnaire. Questionnaires were issued and collected using BBA Undergraduates of
Faculty of Management and Commerce, South Eastern University of Sri Lanka. Collected data
were analysed using correlation and regression analyses. Pearson correlation value between the
relationship between management education and promotion of entrepreneurship is 0.845. Values
of R square and adjusted R squares are 0.715 and 0.712 respectively. These values explain that
that management education explains around 72% of the variation on promotion of
entrepreneurship.

Keywords: Globalised Business Environment, Management Education, Promoting

Entrepreneurship.

1. Introduction

According to French and Raven and other management thinkers, there are different types of
powers. They are formal power, legitimate power, reward power, coercive power and
information power. Information power is acquired by education, experience and learning. On this
basis, management education is also important for entrepreneurs, managers and leaders. There
are enough evidences that highlights management education play key important role in
promoting entrepreneurship. Entrepreneurship is defined by different organization and different
scholars in different countries and in different ways. William (1990) defined that
entrepreneurship can be characterized by eight themes such as entrepreneur, innovation, creation
of organization, creation of value, profit motive, growth, uniqueness and the owner-manager.
European Commission (2015) defined that entrepreneurship is an individual’s ability to turn
ideas into action. It includes creativity, innovation, risk taking, ability to plan and manage
projects in order to achieve objectives. This study is significant for many reasons such as
management education, promotion of entrepreneurship, economic development, contribution to
GDP of the country and many more. This study is organized on the basis of initiatives for
entrepreneurship (Global and Indian) context along with three research parts. The first research
part deals with factors of management education. The second research part focuses on factors of
promotion of entrepreneurship. The third research part is the relationship between management
education and promotion of entrepreneurship.

1.1 Statement of the Problem

Statement of the problem is defined with the support of thorough review of literature. Literatures
are reviewed for promotion of entrepreneurship, management education and both. On the basis
of these reviews of literature and empirical evidences, objectives of the study are set.

1.2 Objectives of the Study

This study attempts to achieve the following objectives. They are as follows.

1. To know the factors of management education

2. To know the factors for promotion of entrepreneurship
3. To find determine the relationship between management education and promotion of
entrepreneurship

2. Factors for Management Education

This is the first research part to know the factors of management education. Several studies have
studied about challenges about entrepreneurs. Reviews of literature have been conducted with
respect to Management Education and promotion of entrepreneurship. They were based on the
literatures of European Commission (2015); Study of Gangaiah & Juturu (2014) that focused on
the impact of Indian management education in developing entrepreneurial aspirations and
attitudes among management students; Ismail & Velnampy (2014); Ravindra (2014); Gangaiah
& Juturu (2014); China Briefing (2013); Mthuli (2013); Ismail (2012); Ismail & Gunapalan
(2012); Ismail (2012); Gayle (2012); Ismail & Gunapalan (2011); Saman (2010); William
(1990); Laura, Tea & Halsey (1994). The above review of literatures assisted to operationalise
management education. Management Education (ME) is operationalised into industrial visits,
curriculum, management games, assignments, learning sessions, EDP Cell in the College, local
industry connectivity, interactions with successful entrepreneurs, project management, case
method of learning, number of management Universities, management colleges, management
Institutes, number of management degrees, quality of management degrees and number of
management teachers.

3. Factors (Challenges) for Promoting Entrepreneurship

This is the second research part to know the factors of promotion of entrepreneurship. Several
studies have studied about challenges about entrepreneurs. These studies have been conducted in
different time frames and indifferent countries. For example, European Commission (2015);
Ravindra (2014); Shiv (2014); Oliver (2013); Mthuli (2013); Gayle (2012); Saman (2010);
Laura, Tea & Halsey (1994) have studied about challenges for promoting entrepreneurship. But,
there are different research findings. Thus, this first part of the study tries to know about the
factors for promoting entrepreneurship in Sri Lanka.

Reviews of literature have been conducted to know about challenging factors faced by
Entrepreneurship for the promotion of entrepreneurship. Reviews were based on European
Commission (2015); Ravindra (2014); Shiv (2014); Oliver (2013); Mthuli (2013); Gayle (2012);
Saman (2010); Laura, Tea & Halsey (1994). Based on these literatures, factors for promotion of
entrepreneurship is operationalised into fragmented policy & policy implementation, adequate
funding of R & D, ease of funding procedures, availability of venture capital & seed funding,
strong linkages between stakeholders, conducive education system, improved infrastructure
facilities in villages, risk-taking among entrepreneurs and adequate protection of intellectual
property rights

This second part of the study considered 101 respondents who are passed out students of
Diploma holders, BBA holders and MBA holders. Study collected data from primary source.
Instrument for collecting data is a simple questionnaire. Questionnaires were issued and
collected using BBA Undergraduates of Faculty of Management and Commerce, South Eastern
University of Sri Lanka. Collected data were analysed using factor analysis with Varimax
rotation.

Results of this second part of the study revealed that values of Cronbach's Alpha for fragmented
policy and policy implementation, inadequate funding of R and D, difficult & lengthy funding
procedures, angel venture capital & seed funding, weak linkages between stakeholders, non-
conducive education system, poor infrastructure facilities in villages, risk aversion among
entrepreneurs and inadequate protection of intellectual property rights are greater than 0.7.
Factors are highly reliable. Kaiser-Meyer-Olkin is a measure of sampling adequacy. Value of
Kaiser-Meyer-Olkin is greater than 0.5. This refers to sample size (101) taken in this study is
enough. Bartlett's Test of Sphericity is approximated by Chi-Square. Value of Chi-Square is
699.655 with degrees of freedom are 36. Initial communalities for factors such as fragmented
policy and policy implementation, inadequate funding of R and D, difficult and lengthy funding
procedures, angel venture capital and seed funding, weak linkages between stakeholders, non-
conducive education system, poor infrastructure facilities in villages, risk aversion among
entrepreneurs and inadequate protection of intellectual property rights are 1. Extracted
communalities for all the above factors are greater than 0.7. The above 9 factors create 9 factor
components. However, there are 3 principal factor components which explain 84.368% i.e.
84.37%. Of the total variance explained, these 3 factor components explain a major portion of
variance. In terms of this scree plot, factor component with eigenvalue that is greater than 1 is
considered as principal components. Factor components 1, 2 and 3 have eigenvalues with 3.404,
2.578 and 1.611. Thus, these three factor components are considered as principal components.

It was concluded that the first factor component that consists of fragmented policy & policy
implementation, angel venture capital & seed funding and poor infrastructure facilities in
villages has the factor score of 0.907266. The second factor component that consists of difficult
and lengthy funding procedures, non-conducive education system and inadequate protection of
intellectual property rights has the factor score of 0.983949. The third factor component that
consists of inadequate funding of R & D, weak linkages between stakeholders and risk-aversion
among entrepreneurs has the factor score of 1.008561.

4. Management Education and Promotion of Entrepreneurship

This is the third part of the study that focuses on the relationship between management education
and promotion of entrepreneurship.

There are number of studies in different countries and in different time frames. For example,
European Commission (2015); Ismail and Velnampy (2014); Ravindra (2014); Gangaiah &
Juturu (2014); China Briefing (2013); Oliver (2013); Mthuli (2013); Ismail & Gunapalan (2012);
Ismail (2012); Gayle (2012); Ismail & Gunapalan (2011); Saman (2010); William (1990); Laura,
Tea & Halsey (1994). These have identified factors for entrepreneurship and management
education. Few other studies have found there is relationship between management education
and promotion of education. But, these relationships were on varying degrees. Thus, this third
part of the study attempts to know the correlation between management education and
entrepreneurship promotion. Previous review of literatures as at the first and second part of the
studies help to derive the following conceptual model of management education and promotion
of entrepreneurship.

4. Methodology

4.1 Sample size

This study considered 101 respondents who are passed out students of Diploma holders, BBA
holders and MBA holders.

4.2 Data collection

Study collected data from primary source. Instrument for collecting data is a simple
questionnaire. Questionnaires were issued and collected using BBA Undergraduates of Faculty
of Management and Commerce, South Eastern University of Sri Lanka.

4.3 Data analysis

Collected data were analysed using correlation and regression analyses.

4.4 Results and Discussion of Findings

4.4.1 Reliability

Management Education that consists of industrial visits, curriculum, management games,

assignments, learning sessions, EDP Cell in the University, local industry connectivity,
interactions with successful entrepreneurs, project management, case method of learning,
number of management Universities, management colleges, management institutes, number of
management degrees, quality of management degrees and number of management teachers has
the Cronbach's Alpha value of 0.703. Since the value of Chronbach’s Alpha is greater than 0.5
all the variables have higher reliability. Reliability statistics for management education is shown
in Table 4.1.

Table 4.1: Reliability statistics for management education and promotion of entrepreneurship
Cronbach's Alpha N of Items Cronbach's Alpha N of Items

0.703 16 .690 9

Similarly, Promotion of Entrepreneurship that consist of unfragmented policy & policy

implementation, adequate funding of R & D, ease of funding procedures, availability of venture
capital & seed funding, strong linkages between stakeholders, conducive education system,
improved infrastructure facilities in villages, risk-taking among entrepreneurs and adequate
protection of intellectual property rights has the Cronbach's Alpha value of 0.690. Since the
value of Chronbach’s Alpha is greater than 0.5 all the variables have higher reliability.
Reliability statistics for promotion of entrepreneurship is shown in Table 4.1.

4.4.2 Descriptive statistics

Mean values of industrial visits, curriculum, management games, assignments, learning sessions,
EDP Cell in the University, local industry connectivity, interactions with successful
entrepreneurs, project management, case method of learning, number of management
Universities, management colleges, management institutes, number of management degrees,
quality of management degrees and number of management teachers are approximately 3 and
above that refers to the satisfactory level. Descriptive statistics for these variables are shown in
Table 4.2.

Table 4.2: Descriptive Statistics for management education and promotion of entrepreneurship
Management N Mean Promotion of N Mean
education entrepreneurship
Industrial Visits 101 2.8317 Unfragmented policy and 101 2.7228
policy implementation
Curriculum 101 3.0198 Adequate funding of R and D 101 2.9505
Management Games 101 2.9604 Ease of funding procedures 101 2.9010
Assignments 101 3.1584 Availability of venture capital 101 3.1485
and seed funding
Learning Sessions 101 2.8218 Strong linkages between 101 2.8614
stakeholders
EDP Cell in the 101 2.8317 Conducive education system 101 2.9406
College
Local Industry 101 3.0198 Improved infrastructure 101 3.3960
Connectivity facilities in villages
Interactions with 101 2.9604 Risk-taking among 101 3.7030
Successful entrepreneurs
Entrepreneurs
Project Management 101 3.1584 Adequate protection of 101 4.4257
intellectual property rights
Case Method of 101 2.8218 Valid N (listwise) 101
Learning
Number of 101 2.8317
management
Universities
Management Colleges 101 3.0198
Management Institutes 101 2.9604
Number of 101 3.1584
management degrees
Quality of 101 2.8218
management degrees
Number of 101 3.2376
management teachers
Valid N (listwise) 101

Mean values of unfragmented policy & policy implementation, adequate funding of R & D, ease
of funding procedures, availability of venture capital & seed funding, strong linkages between
stakeholders, conducive education system, improved infrastructure facilities in villages, risk-
taking among entrepreneurs and adequate protection of intellectual property rights are
approximately 3 and above that refers to the satisfactory level. Descriptive statistics for these
variables are shown in Table 4.2.

4.4.3 Correlation Analysis

This study tried to know the relationship between Management Education and Promotion of
Entrepreneurship. Correlation coefficient shows the value of 0.845. This means that there is a
positive strong correlation between Management Education and Promotion of Entrepreneurship.
Table 4.3 shows the correlation between Management Education and Promotion of
Entrepreneurship.

Table 4.3: Correlation between management education and promotion of entrepreneurship

Management Promotion of
Education Entrepreneurship
Management Education Pearson Correlation 1 .845**
Sig. (2-tailed) .000
N 101 101
**
Promotion of Pearson Correlation .845 1
Entrepreneurship Sig. (2-tailed) .000
N 101 101
**. Correlation is significant at the 0.01 level (2-tailed).

4.4.4 Regression Analysis

Following the correlation analysis, researcher wanted to know the role or impact of management
education on promotion of entrepreneurship.

4.4.4.1 Model Summary

Values of R square and adjusted R squares are 0.715 and 0.712 respectively. These values
explain that that management education explains around 72% of the variation on promotion of
entrepreneurship. Values of R square and adjusted R squares are tabulated in Table 4.4.
 Table 4.4: Model Summary
Model R R Square Adjusted R Square Std. Error of the
Estimate
1 .845a .715 .712 2.90773
a. Predictors: (Constant), Management Education
4.4.4.2 Analysis of Variance

In terms of Analysis of Variance, SS Regression (2095.717) and SS Residual (837.036) make up

SS Total (2932.752). SS Regression is the variation of management education on promotion of
entrepreneurship. SS Residual refers to the variation of other variables that are not included in
the study on promotion of entrepreneurship. MS Regression (2095.717) divided by MS Residual
(8.455) makes up F statistics which is significant. Results of Analysis of Variance are tabulated
in Table 4.5.
Table 4.5: ANOVAa
Model Sum of Df Mean Square F Sig.
Squares
1 Regression 2095.717 1 2095.717 247.870 .000b
Residual 837.036 99 8.455
Total 2932.752 100
a. Dependent Variable: Promotion of Entrepreneurship
b. Predictors: (Constant), Management Education

4.4.4.3 Coefficient

Coefficients are used to describe the unit variation of management education on promotion of
entrepreneurship. Beta values for constant and management education are 0.284 and 0.604
respectively. Table 4.6 tabulates the beta coefficients.
Table 4.6: Coefficientsa
Model Unstandardized Standardized T Sig.
Coefficients Coefficients
B Std. Error Beta
1 (Constant) .284 1.850 .154 .878
Management .604 .038 .845 15.744 .000
Education
a. Dependent Variable: Promotion of Entrepreneurship

Using these two beta coefficients, researcher derived an equation for management education and
promotion of entrepreneurship as stated below.

Promotion of Entrepreneurship = β0 + β1 * Management Education……………….Equation (5.1)

Promotion of Entrepreneurship = 0.284+ 0.604 * Management Education………Equation (5.2)

This equation “Promotion of Entrepreneurship = 0.284+ 0.604 * Management Education” can be
interpreted. In this equation, Value of Management Education equals 0. Promotion of
Entrepreneurship equals 0.284. (β0 = 0.284). This refers to when there is no management
education there is promotion of entrepreneurship. In other words, when Universities do not
provide management education there is minimum level of entrepreneurship. This is true. At the
same time, β1 = Δ promotion of entrepreneurship/ Δ management education. β1 = 0.604. β1 of
Management Education equals 0.604. This means that when there is management education there
is promotion of entrepreneurship. In other words, when Universities provide management
education entrepreneurship is promoted higher.

4.5 Conclusion

Reliability statistics revealed that Cronbach's Alpha value for management education and
promotion of entrepreneurship are 0.703 and 0.690. Mean values for management education and
promotion of entrepreneurship are 3 and above that refers to the satisfactory level. Correlation
coefficient shows the value of 0.845. This means that there is a positive strong correlation
between management education and promotion of entrepreneurship. Results of regression
analysis revealed that values of R square and adjusted R squares are 0.715 and 0.712
respectively. These values explain that that management education explains around 72% of the
variation on promotion of entrepreneurship. Findings of this study are similar to those of
Gangaiah and Juturu (2014) that found the strongest relationship (0.999) between management
education and entrepreneurial aspirations & attitudes.

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