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March 04, 2011

Entrepreneurism and Self-Education

Lucy Kellaway from the Financial Times recently reported that Tyra Banks was headed to Harvard Business School ["Aiming to be America’s Next Top Student," 20 February 2011]. Kellaway notes that Banks is "beautiful, rich and famous" and wonders what is motivating her to head back to school. Kellaway continues:

"There are three reasons people pay through the nose to go [to Harvard Business School]. Some want to learn how to make money. But Tyra knows how to do that already. Some want to meet people who will help them make money. But Tyra's dance card is already full enough with business contacts – her boyfriend has been called the most successful black investment banker in the US. And some go because they hope employers will think the Harvard badge is worth paying extra for. But Tyra is not going to be applying for any job, so this doesn't apply either. Tyra may be doing something entirely novel. She may have enrolled purely and simply because she believes she will learn something."

The cost of learning something at Harvard Business, Kellaway reports, is "almost $100,000 – or about $2,000 per day" for the courses Banks will be taking as part of "the Owner/President Management Program." Not everybody has that kind of money or the academic credentials to get accepted into Harvard Business School or the two other schools that the Financial Times ranks ahead of HBS (London Business School and the Wharton School at the University of Pennsylvania). The reasons for getting an MBA cited by Kellaway are valid (to learn how to make money, to meet someone, and to improve job opportunities). Since this is a post about entrepreneurs and education, I'm not going to discuss the job opportunities -- entrepreneurs make their own. I'm really not going to discuss "meeting people" either. Meeting people that can help you further your aspirations is important, but there are other ways to do that than heading off to a pricey business school. What I would like to focus on is learning how to make money. Before going any further let me make one thing clear, I have nothing against business schools or obtaining an MBA. Business schools have their place and obtaining an advanced degree is a laudable goal. However, I don't believe that you necessarily need an MBA to start a company and you don't need ivy covered walls in order to learn things.

What started me thinking on this subject was an email by a reader named Amanda Harris. In that email, she wrote that she had posted an article entitled 100 Books You Should Read Instead of Going to Bschool and thought it would of interest to readers of this blog. The "100 books" Harris recommends cover topics from motivation to management. The list is intended for use by entrepreneurs. Harris writes:

"If your dream is to own a business, you should know that there are ways around going to business school. In fact, many of the world's most successful CEOs have never been to college. However, this does not mean they are not knowledgeable about their industry and business in general. Reading books by successful professionals can indeed take the place of an MBA. Get familiar with the following books, many of which are quite well-known, before you start your own business."

I don't think that Harris means to imply that if have already started your own you don't have to continue to learn. Learning is good for you whether you have started a business or not. Harris' list touches on all of Kellaway's three reasons for seeking an MBA (to learn how to make money, to meet someone, and improve job opportunities). The whole list is about learning new things about the business world; she has a section of books dedicated to "Connecting with Other People"; and she lists "how to" books and offers a section on "Business Startups for Women." Josh Kaufman, who advertises himself as "an independent business teacher, education activist, and author," doesn't believe that you need to spend a hundred grand getting an MBA either. In fact, he wrote a best-selling book entitled Personal MBA: Master the Art of Business. The teaser for the book reads:

"Getting an MBA is an expensive choice – one almost impossible to justify even in a good economy. Even the elite schools like Harvard and Wharton offer outdated, assembly-line programs that teach you more about PowerPoint presentations and unnecessary financial formulae than what it takes to improve a real business. You can get better results (and save hundreds of thousands of dollars) by skipping business school altogether."

I don't think that it's necessary to attack prestigious business schools to make a point (Kaufman must believe that doing so helps to sell books). In his book, Kaufman, like Amanda Harris, provides a list of books to read that will help you get smarter about business. In his book, he writes:

"If you read these books, you won't have corporate recruiters beating down your door, and you won't have a pretty certificate to hang on your wall when you're done. You will, however, have an understanding of business that's comparable to completing a traditional business school curriculum, along with the pleasures of not having to mortgage your life for that understanding. You do not need a certificate to be able to understand, use, and hold an intelligent conversation about advanced business topics."

Ultimately, that is the point for entrepreneurs. You may be smart, but you can get smarter. You may know some things, but you can know more things. Kaufman, however, is wise enough to know that book smarts are not all you need to be successful. He continues:

"You can't learn about business solely from books (or sitting in a classroom); you have to be willing to go out and learn by doing. Whether you're working full-time for a company or building your own business, a great deal of your knowledge will develop as a direct result of your day-to-day work experiences, which provide the necessary context for understanding what you read. Reading books is not enough; application of what you read is essential."

As an entrepreneur, I can tell you that actual experience is the best teacher I've ever had. That doesn't mean that I've stopped reading or stopped learning. I do both every day. Blogger and entrepreneur Sonia Simone believes that information age tools, like the internet, make it easier than ever to educate yourself ["How to Give Yourself a First-Class Online Business Education," Copyblogger, 4 March 2010]. She writes:

"When I first had the insane brilliant idea to start a business and get out of the alleged safety of the corporate world, I started by reading everything I could find. I wish I could remember where the thread started for me. It might have been Dan Kennedy, it might have been Michael Port, it could very well have been the Personal MBA. Each good resource led to three more. At some point, I found Copyblogger and Problogger and Seth Godin. Hundreds of books and thousands of dollars in information products later, I've given myself an education. Was it expensive? Sure was. But no more expensive than anyone's education. Even an education that's completely free is expensive in time and effort. And just like a college senior ought to be able to get more out of a class than his freshman counterpart, I've gotten very good at efficiently extracting the information I need, leaving aside what I don't, and avoiding the information that's just not worth my time. (Because yes, I still study compulsively, all the time. There’s always more to learn.)"

As an entrepreneur who probably received some help along the way, Simone wants to help others by passing along what she learned "so if you're a little earlier on the path you can avoid some blind alleys." She continues:

"It's always about the fundamentals -- Maybe you’ve heard of the Pareto Principle. (It's also called the 80/20 rule.) It's the observation that, in an amazing variety of circumstances, 80% of the output comes from 20% of the input. Which means that 20% of your customers provide 80% of your revenue. 20% of the time you spend behind your computer provides 80% of your best work. ... Because of the Pareto Principle, there's always a '20%' you should be spending your time on. And in just about every discipline, it's known as the fundamentals. Most people race through the fundamentals so they can get to what they consider the fun stuff — the esoteric, 'advanced' weird material that no one knows. Do you think the fundamentals in your topic are kind of boring? In that case, how do you feel about mastery? The fact is, real masters of any endeavor get scary good at the fundamentals. Read the biography of any massively successful person you admire, from Michael Jordan to Warren Buffett, and you'll discover someone who got freakishly good at what the wannabe hot shots look down on as 'the boring basics.' Understand Pareto's 20% in your field, and work on it over and over again. Then work on it some more."

For more on this subject, read my post entitled Being Good versus Feeling Good: The Case for Working Hard. Simone continues:

"Inspiration is great, but execution pays the bills -- There's one guy in particular whose stuff I find wonderfully inspiring. I always feel energized after reading his paper newsletter or listening to his CDs. I've got a renewed sense of enthusiasm for my profession, I'm filled with hope and energy, I'm ready for anything. And all that is fine. The problem is, it lasts about 20 minutes. Enjoy the inspiration, but don't stop there. Instead, use the energy from all that inspiration and translate just one idea into an action (it can be incredibly small) you're going to take to move your business forward. Then take that action. Really take it, don't just intend to."

A seed lying on a sidewalk is not a tree and a good idea that lies fallow in your brain is not innovation. The old adage that "the road to hell is paved with good intentions" could be modified to read: the road to failure is modified with good intentions. Simone warns, however, that you can have too many good intentions to execute and that can lead to paralysis. She continues:

"Just one thing -- If the book, membership site, ebook, or home study program you've got is any good, you'll probably have more to act on than you can actually get done this week, this month, or possibly this year. It may be helpful to remember a piece of advice given by David Allen. You can't do a whole project. You can only do your next action on that project. Whether or not you're a devotee of Allen's productivity cult Getting Things Done (I am), the idea of the 'next action' is critical if you want to move forward on anything complex. Writing a rough first draft for your email autoresponder is a next action. ... 'Learn how to start an online business' is not. Don't neglect little things because you're looking for big results. Big things are made up of the execution of many, many little things. Education for its own sake can be inspirational and fun (and I would have happily stayed a college undergraduate forever if that had been an option). But if you have practical goals beyond learning, remember to keep those goals front and center."

Since we are talking about self-education, what is the next step that you need to take if you want to improve your knowledge base? How about conducting a personal inventory and honestly assessing your strengths and weaknesses. Once you have your weaknesses identified you can look for books, programs, and assistance that will turn your weaknesses into strengths -- one step at a time. Simone continues:

"Revisit the most valuable stuff -- Human beings are ... attracted to what's new and different. But keep an eye out for those rare resources that are worth visiting again and again. When I had a commute, I used to listen to the same marketing CDs over and over again. They burned a neural pathway in my brain. The information became second nature, as automatic as changing the channel when Leno comes on. Reread the classics in your field. For me, it's Robert Cialdini's Influence, Seth Godin’s Permission Marketing, Eugene Schwartz's Breakthrough Advertising, and a handful of decidedly old-school books on copywriting. ... I'm not looking for radical new insights. I'm looking for one small thing I can add to what I'm doing now."

Blogger Jeff Cobb believes that Simone offers some good insights and he provides some good online assistance himself ["Getting a First-Rate Business Education Online – Free," Mission to Learn, 1 April 2010]. Cobb concludes that when it comes to self-education "you will need to be motivated, and you must be prepared to make time for focused learning, set learning goals, and apply discipline as needed." In other words, it takes the same traits to get smarter as it does to succeed as an entrepreneur. Go out and learn something -- today!

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