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8106392

Jones, B u rto n R obert

' A STUDY OF THE ATTITUDES AND PERCEPTIONS OF SELECTED
PUBLIC UNIVERSITY ADMINISTRATORS IN MICHIGAN CONCERNING
THE DESIGN FOR A STATEWIDE BUSINESS EXTENSION SERVICE

Michigan State University

University
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300 N. Zeeb Road, Ann Arbor, MI 48106

1980

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University
M icrcxiims
International
300 N ZEES RD.. ANN ARSOR Ml 48106 1313) 761-4700

A STUDY OF THE ATTITUDES AND PERCEPTIONS OF SELECTED
PUBLIC UNIVERSITY ADMINISTRATORS IN MICHIGAN
CONCERNING THE DESIGN FOR A STATEWIDE
BUSINESS EXTENSION SERVICE
By
Burton R. Jones

A DISSERTATION

Subm itted to
Michigan S t a t e U n iv e r s ity
in p a r t i a l f u l f i l l m e n t o f t h e req u irem en ts
f o r t h e degree o f
DOCTOR OF PHILOSOPHY
Department o f A d m in is tr a tio n and H igher Education
1980

ABSTRACT
A STUDY OF THE ATTITUDES AND PERCEPTIONS OF SELECTED
PUBLIC UNIVERSITY ADMINISTRATORS IN MICHIGAN
CONCERNING THE DESIGN FOR A STATEWIDE
BUSINESS EXTENSION SERVICE
By
Burton R. Jones

The purposes o f t h i s r e s e a r c h were:

(1) t o c o l l e c t d e t a i l e d

and f a c t u a l in fo rm a tio n t h a t would e n a b le th e r e s e a r c h e r to a s s e s s th e
f e a s i b i l i t y and d e s i r a b i l i t y o f e s t a b l i s h i n g a small b u s in e s s d ev elo p ­
ment c e n t e r program t h a t would be a d m in is te r e d through th e b u s in e s s
c o l l e g e s a t M ich ig an 's p u b l i c , f o u r - y e a r c o l l e g e s and u n i v e r s i t i e s ;
(2) t o s e c u re r e l e v a n t views and in fo rm a tio n from th e b u s in e s s deans
con cerning s p e c i f i c is s u e s and o p e r a tio n a l concerns in v o lv e d in
d e s ig n in g and implementing a small b u s in e s s developm ent c e n t e r program;
(3) t o a n a ly z e th e e x t e n t o f agreem ent and d isag reem en t on th e is s u e s
and concerns examined; and (4) t o develop from t h e i n te r v ie w d a ta a s e t
o f norm ative s ta te m e n ts co n cern in g th e d e s i r a b l e c h a r a c t e r i s t i c s o f a
small b u s in e s s development c e n t e r program in M ichigan.
The s p e c i f i c concerns ad d ressed in t h i s s tu d y were:

Burton R. Jones
Concern 1 - The p o t e n t i a l f o r i n t e g r a t i n g th e small b u sin e ss
a s s i s t a n c e program w ith t h e i n s t r u c t i o n a l program
o f th e b u s in e s s c o l l e g e s / s c h o o l s .
Concern 2 - The p o t e n t i a l f o r i n t e g r a t i n g th e sm all b u sin e ss
a s s i s t a n c e program w ith th e r e s e a r c h a c t i v i t i e s
o f t h e b u s in e s s c o l l e g e s / s c h o o l s .
Concern 3 - The p o t e n t i a l f o r i n t e g r a t i n g th e small b u s in e s s
a s s i s t a n c e program w ith th e s e r v i c e a c t i v i t i e s
o f th e b u s in e s s c o l l e g e s / s c h o o l s .
Concern 4 - The ty p e o f small b u s in e s s a s s i s t a n c e program
model t h a t would be most e f f e c t i v e in u t i l i z i n g
c o l le g e and u n i v e r s i t y r e s o u r c e s .
Concern 5 - The ty p es o f small b u s in e s s e s t h a t should r e c e iv e
a ssis ta n c e .
Concern 6 - The r e s o u r c e req u irem en ts and funding arrangem ents
needed t o i n i t i a t e a small b u s in e s s a s s i s t a n c e
program.
Concern 7 - The most a p p r o p r i a t e arrangem ent f o r a d m in is te r in g
and c o o r d in a tin g a s ta t e w id e program.
The p o p u la tio n was composed o f a l l deans o f b u s in e s s a n d /o r
management s c h o o ls o r c o lle g e s a t th e f i f t e e n p u b l i c , f o u r - y e a r c o l l e g e s
and u n i v e r s i t i e s in M ichigan.
f o r th e p i l o t i n t e r v i e w s .

Two o f th e f i f t e e n deans were s e l e c t e d

The sample was composed o f th e rem aining

t h i r t e e n d ean s.
I n te rv ie w s o f th e deans were reco rd ed on a c a s s e t t e ta p e deck.
A f t e r each i n t e r v i e w , th e r e s e a r c h e r l i s t e n e d t o t h e c a s s e t t e ta p e s w ith
a copy o f th e I n te r v ie w fo rm at as a guide and t r a n s c r i b e d th e r e l e v a n t
p o r tio n s o f th e i n te r v i e w s .

Two ju d g es p a r t i c i p a t e d in t h i s p a r t o f

th e s tu d y f o r th e purpose o f rev iew in g and v a l i d a t i n g th e work o f th e
researcher.

Burton R. Jones
On th e b a s is o f
e s ta b lis h m e n t o f a small

t h e in te r v ie w d a ta i t was concluded t h a t th e
b u s in e s s development c e n t e r program in co­

o p e r a tio n w ith b u s in e s s c o lle g e s and sch oo ls a t most o f M ich ig an 's
p ub lic* f o u r - y e a r c o lle g e s and u n i v e r s i t i e s would be f e a s i b l e .
I t was f u r t h e r concluded t h a t th e fo llo w in g norm ative g u id e­
l i n e s should be follow ed in d e sig n in g a small b u s in e s s development
program f o r Michigan:
(1)

The small b u s in e s s a s s i s t a n c e program should be i n t e ­
g r a te d w ith th e i n s t r u c t i o n a l , r e s e a r c h , and s e r v i c e
programs o f th e b u s in e s s c o ll e g e s and sch o o ls t h a t
p a r t i c i p a t e in t h e program.

(2)

The small b u s in e s s a s s i s t a n c e program should be based in
u n i v e r s i t i e s r a t h e r than in th e p r i v a t e s e c t o r , b u t
th e p r i v a t e s e c t o r should be d i r e c t l y inv olv ed in
plan nin g and a d v iso ry c a p a c i t i e s .

(3)

The small b u s in e s s a s s i s t a n c e program should p ro v id e
s e r v i c e s to a l l ty p es o f small b u s in e s s e s w ith
c e r t a i n ty pes o f b u s in e s s e s r e c e iv in g h ig h e r p r i o r i t y
o r more in -d e p th a s s i s t a n c e than o t h e r s .

(4)

The small b u s in e s s a s s i s t a n c e program should be i n i ­
t i a t e d w ith a very small s t a f f a t each p a r t i c i p a t i n g
i n s t i t u t i o n and f u n c tio n as a c le a rin g h o u s e in
matching small b u sin ess needs w ith t h e a p p r o p r i a t e
resources.

(5)

The small b u s in e s s a s s i s t a n c e program should be
funded by th e S t a t e o f Michigan u n t i l such tim e as
t h e program i s su p po rted by o t h e r so u rces o f funding
in c lu d in g an i n s t i t u t i o n a l match.

(6)

A s ta te - f u n d e d small b u s in e s s a s s i s t a n c e program
should be a d m in iste re d through and c o o rd in a te d by
th e O ffic e o f Economic Development o f th e Michigan
Department o f Commerce.

DEDICATION

This d i s s e r t a t i o n i s d e d ic a te d to my p a re n ts whose exemplary
l i v e s and values have shaped and i n s p i r e d my l i f e a t ev ery s te p and
t o my w ife whose love and confid en ce in me have provided th e c o r n e r ­
s to n e s needed t o complete t h i s u n d e rta k in g .

11

ACKNOWLEDGEMENTS

The w r i t e r wishes t o ex p ress h is s in c e r e a p p r e c ia tio n t o
th e chairman o f h is d o c to r a l com m ittee, Dr. Richard L. F e a th e rs to n e .
His f r i e n d s h i p , a d v ic e , and s e n s i t i v e c r i t i c i s m have provided me th e
p ro per b alan ce between freedom and c o n s t r a i n t needed t o complete th e
program and d i s s e r t a t i o n .
S p ecial thanks i s a l s o due to my s e c r e t a r y , Carolyn K. Towsley,
f o r h er t i r e l e s s e f f o r t s in ty p in g t h i s m an u sc rip t.

1ii

TABLE OF CONTENTS
Page
I.

II.

III.

THE PROBLEM.....................................................................................

1

I n tr o d u c tio n ...............................................................................
The Need f o r E du catio n, Research and Management
and Technical A s s is ta n c e f o r Small Business . .
The Small Business Development C enter Concept . .
Purpose o f th e Study ...........................................................
The Research Problem ...........................................................
S ig n if ic a n c e o f th e S tu d y ....................................................
Research Design ........................................................................
Scope and L i m i t a t i o n s ...........................................................
Overview o f th e S t u d y ...........................................................

1

SMALL BUSINESS:

3
5
8
9
11
12
13
13

A NON-TRADITIONAL CLIENTELE IN NEED

17

I n tr o d u c tio n ...............................................................................
D efining Small Business ....................................................
20
The S tr u c t u r e o f th e American
Economy.
Why Small B u sinesses F a i l .............................
23
U n iv e r s ity Responses to Small Business Needs .
.
Educational Programs f o r Small B usinesses . . .
C o n su lting A s s is ta n c e : The Small Business
I n s t i t u t e Program..................................................................
Comprehensive A s s is ta n c e : SBDC P i l o t Programs. .
The U n iv e r s ity o f Georgia SBDC........................................
The C e n tra l O rg an izatio n ..............................................
The S e rv ic e D eliv ery Network .......................................
The C ontinuing Education D iv isio n ...........................
B usiness Inform ation D iv is io n ........................................
R e s id e n tia l I n s t r u c t i o n D iv is io n .................................
S p e c ia liz e d S e r v ic e s ...........................................................
F in a n c ia l Resources ...........................................................
E v alu atio n o f SBDC P i l o t Programs .................................

17
18
27
28
35
41
44
44
44
46
47
49
49
50
50

METHODOLOGY.....................................................................................

57

The P op ulatio n and Sample.....................................................
The Research I n te rv ie w ...........................................................
The Method o f Data A nalysis ..............................................

57
58
61

iv

Page
IV.

V.

ANALYSIS OF RESU LT S...................................................................

65

Concern 1 - The P o t e n t i a l f o r I n t e g r a t i n g th e
Small B usiness A s s is ta n c e Program w ith th e
I n s t r u c t i o n a l Programs o f th e Business
C o lle g e s /S c h o o ls ...................................................................
Concern 2 - The P o t e n t i a l f o r I n t e g r a t i n g th e
Small B usiness A s s is ta n c e Program w ith th e
Research A c t i v i t i e s o f t h e B usiness
C o lle g e s /S c h o o ls ...................................................................
Concern 3 - The P o t e n t i a l f o r I n t e g r a t i n g th e
Small B usiness A s s is ta n c e Program w ith th e
S cien ce A c t i v i t i e s o f th e B usiness
C o lle g e s /S c h o o ls ...................................................................
Concern 4 - The Type o f Small B usiness A s s i s ­
ta n c e Program Model T hat Would Be Most
E f f e c t i v e In U t i l i z i n g C o lleg e and U niv er­
s i t y R e so u rc e s.........................................................................
Concern 5 - The Types o f Small B u sin esses T hat
Should Receive A s s is ta n c e ...............................................
Concern 6 - The Resource Requirements and
Funding Arrangements f o r I n i t i a t i n g a
Small B usiness A s s is ta n c e Program ...........................
Concern 7 - The A p p ro p ria te S t r u c t u r e f o r
A d m in iste rin g and C o o rd in a tin g a
S ta te w id e Program.......................................
Summary.............................................................................................

89
92

SUMMARY AND CONCLUSIONS............................................................

98

Summary o f t h e Study ............................................................
Major F i n d i n g s .........................................................................
C onclusions and Recommendations f o r t h e Design
o f a Small B usiness A s s is ta n c e Program. . . .
I m p lic a tio n s f o r F u r th e r Research ..................................

98
101

66

73

76

79
83
87

Ill
118

APPENDICES
APPENDIX
A.

LETTER AND COPY OF HOUSE BILL 5058 ...................................

120

B.

STRUCTURED INTERVIEW FORMAT

................................................

126

C.

COMPILATION OF DEANS' RESPONSES TO
STRUCTURED INTERVIEW ............................................................

130

SELECTED BIBLIOGRAPHY................................................................................

145

v

LIST OF TABLES

EMPHASIS PLACED ON CONTENT OF PROGRAMS
IN SMALL BUSINESS MANAGEMENT. . . .
MAJOR CLIENTELE ORIENTATION OF SMALL
BUSINESS MANAGEMENT PROGRAMS. . .

.

TIME PERIODS FOR COURSE/PROGRAM OFFERINGS
TYPES OF INSTRUCTORS UTILIZED IN PROGRAMS
PROGRAM FORMAT AS TO THE TIME LENGTH.

.

LIST OF FIGURES
F igure

Page

1.

THE GROWTH OF THE SBI PROGRAM...............................................

37

2.

SBI COLLEGES AND UNIVERSITIES ...............................................

38

3.

UNIVERSITY OF GEORGIA SBDC ORGANIZATION CHART.

45

vii

.

.

CHAPTER I
THE PROBLEM
I n tr o d u c tio n
" . . . a g r e a t c u r r e n t c h a lle n g e i s t o g ear up th e p u b lic
s e r v i c e r o l e o f th e u n i v e r s i t i e s t o meet s o c ia l demands,
w h ile i n s u r in g t h a t such s e r v i c e i s r e l a t e d to main
i n s t i t u t i o n a l a c t i v i t i e s and conducted a t th e h i g h e s t
p o s s i b le p r o f e s s io n a l l e v e l . " 1
Corson g iv es f i v e v a l i d reasons why th e n a tio n has c a l l e d upon
th e u n i v e r s i t y t o help b u ild a b e t t e r s o c i e t y .

They a r e :

"unique i n s t i ­

t u t i o n a l s t r e n g t h s , " a " s u b s t a n t i a l monopoly" o f human t a l e n t , a " d i s ­
c i p l i n e o f o b j e c t i v i t y , " a commitment to th e " sea rch f o r new knowledge,"
and " v a l u e s . "2

The contemporary p u b lic s e r v i c e r o l e o f h ig h e r ed u catio n

i n s t i t u t i o n s i s a lo g i c a l e x te n s io n o f th e l a n d - g r a n t id e a o f i n s t i t u t i o n
al commitment t o s e r v i c e s t h a t reach beyond th e t r a d i t i o n a l classroom
and th e u n i v e r s i t y has a r e s p o n s i b i l i t y t o the s o c i e ty t o expand th e
b e n e f i t s o f le a r n in g t o th e l a r g e r p u b lic .
O p e r a t i o n a l l y , Long c a te g o r i z e s p u b l i c s e r v i c e a c t i v i t i e s to
in c lu d e :
1.
2.
3.
4.
5.

D issem in ation o f knowledge beyond th e campus.
D e liv e ry o f i n s t r u c t i o n a l programs byond th e campus.
Applied r e s e a r c h f o r immediate p u b lic problems.
S h aring o f r e s o u r c e s , in c lu d in g f a c i l i t i e s and i n ­
s t r u c t i o n a l and o t h e r l e a r n in g r e s o u r c e s and p e r ­
sonnel .
P u b lic p a r t i c i p a t i o n in c u l t u r a l , e s t h e t i c , and
oth er u n iv e rsity a c t i v i t i e s .

1

2
6.
7.

The development o f p u b lic p o lic y is s u e s and a l t e r n a ­
tiv e s.
Community development and community problem s o l v i n g . 3
Long p o in ts o u t t h a t :

Too o f t e n , in r e c e n t y e a r s , th e s e s e r v i c e programs have
n o t been n a t u r a l b y -p ro d u cts o f e x i s t i n g i n s t r u c t i o n a l
and r e s e a r c h program s. Many have had only a t a n g e n t i a l
c o n n e c tio n , fo cu sin g more on h u m an itarian a s s i s t a n c e o r
on p o l i t i c a l and id e o lo g ic a l a c t i v i t y than on i n t e l l e c ­
tu a l and s c h o l a r l y p u r p o s e s .4
While arg uin g t h a t u n i v e r s i t i e s should c o n tin u e t o a c c e p t
i n c r e a s i n g r e s p o n s i b i l i t y f o r dev elo pin g and a p p ly in g u s e fu l knowledge
in t h e s o lv in g o f s o c i e t y ' s m ajor i l l s , Corson summarizes a dilemma
which t h i s accep tan ce o f r e s p o n s i b i l i t y imposes:
Acceptance o f th e s e r e s p o n s i b i l i t i e s may make o f th e
u n i v e r s i t y an i n t e l l e c t u a l h o ldin g company. Even as
i t has s u b s i d i a r i e s , known as c o l l e g e s , concerned w ith
te a c h in g and r e s e a r c h , i t may a l s o have s u b s i d i a r i e s ,
known as i n s t i t u t e s , l a b o r a t o r i e s , o r c e n t e r s , engaged
i n r e s e a r c h and in th e a p p l i c a t i o n o f new knowledge to
c u r r e n t problems. Within t h i s h o ld in g company s t r u c t u r e
may e x i s t many n o n p r o f i t i n s t i t u t i o n s . Now, many o f
th e s e v a lu a b le i n s t i t u t i o n s f l o a t in u n p ro d u ctiv e s p a c e ,
la c k in g th e u m b ilical cord to an i n s t i t u t i o n a l s e t t i n g .
F a i l u r e t o a c c e p t th e s e r e s p o n s i b i l i t i e s - and th e
i n a b i l i t y o f u n i v e r s i t i e s to e f f e c t i v e l y modify t h e i r
p ro ced u res and t h e i r s t r u c t u r e in th e p a s t su g g e sts
th ey may f a i l - w i l l l i k e l y r e s u l t in th e p r o l i f e r a t i o n
o f n o n p r o f i t , in dep en dent r e s e a r c h a g e n c ie s u n r e la te d
t o th e po ols o f t a l e n t t h a t make up th e u n i v e r s i t y
fa c u ltie s.®
In o r d e r to m a in ta in i n s t i t u t i o n a l i n t e g r i t y w hile responding t o
p u b lic n eed s, Long recommends t h a t t r a d i t i o n a l and c u r r e n t modes and
o r g a n i z a t i o n a l mechanisms f o r d e l i v e r i n g p u b lic s e r v i c e a c t i v i t i e s be
improved:

#

3
Improved mechanisms should in c lu d e more f l e x i b l e i n s t r u c ­
t i o n a l p a t t e r n s and "boundary" d ev ices t h a t enhance th e
u n i v e r s i t y 's c r e a t i o n and d iss e m in a tio n o f knowledge
m ission w h ile responding t o p u b lic p o lic y and o t h e r needs
o f e x t e r n a l p u b li c s . S e rv ic e programs should be d i s c i ­
p l i n e d , e v a lu a te d and reviewed w ith as much i n t e r n a l
s c r u t i n y and p r e c i s i o n (perhaps more) as i n s t r u c t i o n a l
and r e s e a r c h programs. The o b je c t i v e s o f th e i n s t i t u t i o n
should be c l e a r and n o t confused w ith th e o b j e c t i v e s o f
th e p erso ns s e r v e d . 6
Or, as Shannon and Schoenfeld p u t i t , "To be worthy o f th e
name u n i v e r s i t y e x t e n s io n , an o u tre ach o p e r a tio n must be o f and n o t
sim ply in th e u n i v e r s i t y . " 7
The concerns ex p ressed above, and th e v a r i e t y o f i s s u e s
i m p l i c i t in th o se c o n c e rn s, a r e once again being brought i n t o focus
in an a r e a o f p u b lic s e r v i c e which i s c u r r e n t l y e v o lv in g .

A new

c l i e n t e l e whose needs a r e being ad dressed by a growing number o f
u n i v e r s i t i e s a re small b u s in e s s manager-owners.
The Need f o r E d u c atio n . R esearch, and Management and Technical
A s s is ta n c e f o r Small Business
Although r e p o r te d s t a t i s t i c s v a ry , i t appears t h a t approxim ately
o n e - t h i r d o f new b u s in e s s e s a r e d isc o n tin u e d w ith in th e f i r s t y e a r o f
o p e r a ti o n , f i f t y p e r c e n t w ith in two y e a r s , and s i x t y to e i g h ty p e rc e n t
a r e d is c o n tin u e d p r i o r t o th e f i f t h y e a r .

The s i t u a t i o n i s summarized

by Welsh:
The dismal re c o rd o f f a i l u r e among new
u nnecessary tra g e d y . The e n tr e p re n e u r
dream w ith l i t t l e i f any con cep tio n o f
he i s about to assume w ith o u t adequate
i s needed i s a p l a n . 8

b u s in e s s i s an
le a p s a f t e r h i s
th e r e s p o n s i b i l i t y
p r e p a r a t i o n . What

There have been s e v e ra l e f f o r t s t o determ ine reaso n s beyond p e r­
sonal c h a r a c t e r i s t i c s f o r th e high f a i l u r e r a t e s .

C hariesw orth surveyed

200 small b u s in e s s e s which were c l i e n t s o f th e U n iv e r s ity o f K entucky's

4

O ffic e o f Business Development between J u ly 1968 and J u ly 1972.9
The f in d in g s o f th e survey i n d i c a t e t h a t th e problems most f r e q u e n tl y
co n fro n te d by small b u sin e ss persons in clu d ed f i n a n c i a l p la n n in g ,
a c c o u n tin g , and m ark etin g.

On t h e b a s is o f verbal r e p o r t s , C hariesw orth

concluded t h a t lack o f good management was th e most l i k e l y reason f o r
fa ilu re .

Dun and B r a d s tr e e t tend to confirm th e s e f in d in g s in a r e p o r t

which concludes t h a t over n in e ty p e rc e n t o f small b u sin e ss f a i l u r e s a re
management r e l a t e d J O
Welsh a l s o confirm s th e b e l i e f t h a t management problems account
f o r small b u s in e s s f a i l u r e s .

He i d e n t i f i e d f i v e c h a r a c t e r i s t i c s o f a

group o f small b u s in e s s p r e s i d e n t s t h a t he had p e r s o n a lly known and
whose b u s in e s s e s were in f i n a n c i a l d i f f i c u l t y .

The c h a r a c t e r i s t i c s

id e n tifie d are:
1.

Lack o f flu e n c y in th e language o f b u s in e s s , e s p e c i a l l y
in u n d erstan d in g t h e f i n a n c i a l a s p e c ts o f th e b u sin ess
and more s p e c i f i c a l l y , th e con cep t o f f in a n c i a l acco un t­
in g ; hence th e e n tr e p re n e u r i s dependent upon o th e r s f o r
such m a t te r s .

2.

Lack o f knowledge o f th e r e g u l a t o r y ag en cies o f govern­
ment which im pact on th e b u s in e s s ; h e r e , th e e n tr e p re n e u r
d e le g a te s a u t h o r i t y t o a lawyer r a t h e r than a tte m p tin g to
u nd erstan d th e is s u e s h im s e lf.

3.

Lack o f tim e ly f i n a n c i a l r e p o r t s to check th e c u r r e n t
f i n a n c i a l s t a t u s a g a i n s t f in a n c i a l f o r e c a s t s . Welsh ex­
p l a i n s t h a t only th e f u t u r e can be managed, and w ith o u t
knowledge o f th e r a t e o f c u r r e n t p r o g r e s s , as compared
t o th e d e s ir e d r a t e o f p r o g r e s s , th e e n t r e p r e n e u r cannot
manage a n y th in g .

4.

Lack o f u n d erstan d in g t h a t a b u s in e s s i s a group o f
people who have th e same o b j e c t i v e s ; when t h i s ceases t o
be th e c a s e , members o f th e group begin t o work toward
d iv e r g e n t o b j e c t i v e s . ' '
Lack o f management s k i l l s on th e p a r t o f th o se i n i t i a t i n g new

v e n tu re s i s a l s o co n sid e red an im p o rtan t f a c t o r in i n f lu e n c in g i n v e s t o r s '

5

d e c is io n s to prov id e f in a n c in g .

The soundness o f management s t r a t e g y

and th e q u a l i t y o f personnel involved in a v e n tu re were th e two f a c t o r s
ranked as most im p o rtan t by v e n tu re c a p i t a l i s t s in a stu d y conducted by
B ean.12

The p r e v a i l i n g market and c o m p e titiv e f a c t o r s were ranked

second, and p ro d u ct soundness f a c t o r s were ranked t h i r d .
The f e d e ra l government has in v e s te d l a r g e sums o f money to
i d e n t i f y and meet s p e c i f i c a l l y d e fin e d needs o f e n tr e p r e n e u r s through
th e Small Business A d m in is tr a tio n , Department o f Commerce, N ational
8ureau o f Standards and th e N ational S cience Foundation.

In a d d i t i o n ,

C ic c h i n e l l i and Grad r e p o r t t h a t many u n i v e r s i t i e s have r e c e n t l y de­
veloped programs to a s s i s t e n tr e p re n e u r s in t h e i r e n d e a v o r s .1^

At th e

f o r e f r o n t o f t h i s a c t i v i t y i s th e Small Business Development C enter
program which has been f o s t e r e d by th e f e d e ra l government through e i g h t
u n iv e r s ity - b a s e d p i l o t programs.
The Small Business Development C en ter Concept
The Small Business Development C enter (SBDC) con cep t in v o lv e s th e
development o f u n iv e r s ity - b a s e d management d e l i v e r y systems which u t i l i z e
th e re so u rc e s o f l o c a l , s t a t e and f e d e r a l government program s, th e p r i ­
v a te s e c t o r , and th e i n t e r d i s c i p l i n a r y f a c i l i t i e s and s tu d e n ts o f p a r ­
tic ip a tin g u n iv e rsitie s.

By li n k i n g t o g e th e r th e above r e s o u r c e s , th e

SBDC program a tte m p ts t o pro vid e a framework f o r c o o p e r a tiv e ly r e l a t i n g
u n i v e r s i t y re s o u rc e s to e x te r n a l r e s o u r c e s .
Although th e Small Business A d m in istra tio n has been th e c a t a l y s t
in th e o r g a n iz a tio n o f th e Small Business Development C enter c o n c e p t, i t
i s a c c u r a te t o s t a t e t h a t th e modules from which i t i s c o n s tr u c te d a r e
th e p ro d u ct o f many f e d e r a l ag en cies and th e in n o v a tiv e o u tre a c h

6

programs o f numerous u n i v e r s i t i e s and c o lle g e s th ro u g h o u t th e n a tio n .
Nor does th e Small Business A d m in istra tio n claim t h a t th e SBDC concept
i s an e n t i r e l y new co n cep t.

Some o f th e b a s ic " b u ild in g blocks" a r e :

1.

The Economic Development A d m i n is t r a ti o n 's U n iv e r s ity
C enter Program.

2.

The Department o f H e a lth , Education and W e lf a re 's
c o o p e r a tiv e e d u c a tio n program in which s tu d e n ts work
in a b u s in e s s .

3.

The Small Business A d m in i s t r a ti o n 's S erv ic e Corps o f
R e tir e d E xecutives and A ctive Corps o f E xecutives
(SCORE/ACE) programs which p ro v id e f o r v o lu n te e r
management c o u n se lin g s e r v i c e s .

4.

The SBA Small Business I n s t i t u t e Program which has
involved b u s in e s s s tu d e n ts and f a c u l t y c o o r d in a to rs
in p ro v id in g small b u s in e s s c o u n selin g s e r v i c e s . *4
Small Business Development C en ter programs a r e designed to

p rov ide t o small b u s in e s s c l i e n t s a l l o f th e fo llo w in g s e r v i c e s :
1.

Determining by i n v e s t i g a t i o n , a n a l y s is and judgm ent,
th e f a c t o r s which ap pear t o be p re v e n tin g a p r o f i t o r ie n te d e n t e r p r i s e from making a p r o f i t ;

2.

Determining th e f a c t o r s which a r e i n h i b i t i n g f u r t h e r
growth in a p r o f i t - o r i e n t e d e n t e r p r i s e ;

3.

D eterm ining, as a p p r o p r i a t e , t h e s p e c i f i c f a c t o r s which
th e management o f a new e n t e r p r i s e must u n d erstan d and
p r a c t i c e to a s s u r e p r o f i t making;

4.

Working w ith SBDC c l i e n t s t o develop u n d erstan d in g o f
accep ted b u s in e s s p r a c t i c e s and convincing th e c l i e n t
o f th e n e c e s s i t y o f ad h erin g t o them; and

5.

M on ito rin g , p e r i o d i c a l l y , th e c l i e n t ' s b u s in e s s op era­
t i o n s f o r purposes o f a s s u r in g co ntin ued management
d ev elo p m en t.15
In a d d i ti o n to th e s e b a s ic s e r v i c e s , u n i v e r s i t i e s and o t h e r

o r g a n iz a tio n s which have s p e c i a l i z e d s e r v i c e s o f v alu e t o sm all b u s i ­
ness e n tr e p r e n e u r s can be in clu d ed in th e Small B usiness Development

7

C enter network.

The s p e c i a l i z e d s e r v i c e s which th e SBA i d e n t i f i e s as

d e s i r a b l e in c lu d e :
1.

Business S k i l l s Assessment C enters - which w i l l e v a lu a te
th e c l i e n t s ' l e v e l s o f b u s in e s s s k i l l s in r e l a t i o n to
th e ty p es o f b u s in e s s e s un d ertak en .

2.

I n t e r n a t i o n a l Trade C enter - to a s s i s t SBDC c l i e n t s who
m anufacture e x p o r ta b le p ro d u cts to a n a ly z e , d e v e lo p , and
implement an a p p r o p r ia te i n t e r n a t i o n a l m arketing program.

3.

Business Law Inform ation S e rv ic e s - which w il l o f f e r le g a l
in fo rm a tio n t o SBDC c l i e n t s .

4.

C a p ita l Formation Advisory S e rv ic e s - which w i ll p ro vid e
in -d e p th f i n a n c i a l c o u n s e lin g , in c lu d in g f i n a n c i a l p la n ­
ning and loan packaging guidance.

5.

T echnical C enters - which w i l l make technology a s s i s t a n c e
s e r v i c e s a v a i l a b l e to small b u sin e ss c l i e n t s , e . g . ,
energy a u d i t s , p ro d u ct a n a l y s i s and improvement, new
p ro d u ct developm ent, e t c .

6.

S p ecial Group Emphasis S e rv ic e s - which w i l l p ro v id e o u t ­
reach s e r v i c e s , t r a i n i n g and c o u n selin g f o r m i n o r i t i e s
and o t h e r s p e c ia l need groups.

7.

Economic and Business Data A n aly sis C enters - which w il l
develop in fo rm atio n to be used in d ev elop ing c l i e n t b u s i ­
ness p la n s ; make m a r k e t.a n a ly s e s ; and p rov id e b u s in e s s
and economic f o r e c a s t s . 16
The SBDC con cep t o u tl i n e d by th e SBA i s in te n d e d t o be f l e x i b l e

and to p ro v id e th e freedom in program development and im plem entation
r e q u i r e d by th e v a rio u s u n i v e r s i t i e s p a r t i c i p a t i n g in th e program.
Concerning th e a p p r o p r ia te n e s s o f th e SBDC co n c e p t, Dr.
Horace J . DePodwin, Dean o f Rutgers U n i v e r s i t y 's Graduate School o f
Business A d m in is tr a tio n , made th e fo llo w in g remarks b e fo re th e S e l e c t
Committee on Small Business o f th e U.S. S en ate:

8

A few u n i v e r s i t i e s , in c lu d in g our own, have dem onstra­
te d t h a t a p a r t n e r s h i p w ith government can make an impor­
t a n t c o n t r ib u t i o n t o th e r a p i d growth o f some small b u s i ­
n esses and t o th e s u r v iv a l o f o t h e r s . My o b s e rv a tio n i s
based on th e e x p e rie n c e o f th o s e few s c h o o ls , w hich, w ith
th e s u p p o rt o f th e Department o f Commerce and th e Small
Business A d m in is tr a tio n , i n i t i a t e d programs t o a i d b u s i ­
n e s se s o f small s i z e . . . .
The co ncep t o f th e Small Business Development C en ter i s
an a p p r o p r i a t e fo u n d atio n upon which t o b u ild government
programs o f a s s i s t a n c e t o small b u s in e s s . We e n v isio n th e
c e n t e r s c o o r d in a tin g th e a p p l i c a t i o n o f r e s o u r c e s , e s ­
p e c i a l l y knowledge and manpower a v a i l a b l e w ith in th e
u n i v e r s i t i e s , to th e small b u s in e s s s e c t o r . . . .
Many beginning e n tr e p r e n e u r s have no knowledge o f th e
a s s i s t a n c e u n i v e r s i t i e s can p ro v id e . However, w ith p ro p er
prom otion, th e small b u s in e ssp e rso n w i l l come to recognize
th e SBDC as th e p la c e where h e , o r s h e , may r e a d i l y a v a il
them selves o f th e s k i l l s and knowledge needed t o begin a
new e n t e r p r i s e o r to s u p p o rt an e x i s t i n g o n e . ■'
Purpose o f th e Study
The purposes o f t h i s s tu d y a r e as fo llo w s :

(1) to c o l l e c t

d e t a i l e d and f a c t u a l in fo rm a tio n t h a t w i l l e n a b le th e r e s e a r c h e r t o a s s e s s
th e f e a s i b i l i t y and d e s i r a b i l i t y o f e s t a b l i s h i n g a small b u s in e s s develop­
ment c e n t e r program t h a t would be a d m in iste re d through th e b u s in e s s
c o l l e g e s a t M ich ig an 's p u b lic f o u r - y e a r c o lle g e s and u n i v e r s i t i e s ;
(2) t o s e c u re r e l e v a n t views and in fo rm a tio n from th e b u s in e s s deans
concerning s p e c i f i c i s s u e s and o p e r a tio n a l concerns Involved in d e sig n in g
and implementing a small b u s in e s s development c e n t e r program; (3) to
an aly ze th e e x t e n t o f agreement o r d isag reem en t on th e i s s u e s and con­
c ern s examined; and (4) to develop from th e in te r v ie w d a ta a s e t o f
norm ative s ta te m e n ts concerning th e d e s i r a b l e c h a r a c t e r i s t i c s o f a small
b u s in e s s development c e n t e r program in M ichigan.

9

The Research Problem
There a r e many Is s u e s and concerns which must be c o n sid e red
when d e s ig n in g a u n iv e r s ity - b a s e d program f o r th e purpose o f p ro v id in g
s e r v i c e s t o small b u s in e s s e s .

The many o p tio n s a v a i l a b l e t o d e c is io n

makers h i g h l i g h t th e n e c e s s i t y f o r c a r e f u l p lan n in g o f such a program.
Shannon and Schoenfeld i d e n t i f y te n f a c t o r s which a r e c r u c i a l t o th e
development o f an e f f e c t i v e u n i v e r s i t y e x te n s io n program.
1.

These a r e :

A c l e a r - c u t s ta te m e n t o f th e u n i v e r s i t y ’s e x te n s io n
m is s io n , in c o r p o r a tin g dim ensions, m ethods, p r i o r i t i e s ,
and s ta n d a r d s .

2. A sense o f th e s i g n i f i c a n c e o f t h i s m ission and an
ungrudging commitment to i t on th e p a r t o f th e e n t i r e
u n i v e r s i t y f a c u l t y , from th e c h i e f a d m i n i s t r a t i v e
o f f i c e t o each i n d iv id u a l p r o f e s s o r .
3. A d i r e c t , c o n s i s t e n t two-way channel between e x te n s io n
personnel and a l l th e a p p r o p r i a t e d e p a rtm e n ts, s c h o o ls ,
and c o lle g e s o f th e u n i v e r s i t y .
4.

A sy m biotic r e l a t i o n s h i p between u n i v e r s i t y r e s e a r c h
and u n i v e r s i t y e x te n s io n .

5.

Im a g in a tiv e , c o o rd in a te d

6.

An e x te n s io n s t a f f t h a t m e r its and wins f u l l f e llo w s h ip
in th e u n i v e r s i t y community w h ile perform ing i t s e s s e n ­
t i a l m issio n .

7.

An e x te n s io n cu rricu lu m t h a t r e f l e c t s r e s p o n s i b i l i t y
f o r i n d u s t r i a l i d e a l s and re sp o n siv e n e ss t o modern
a d u l t needs.

8.

E f f e c t i v e te a c h in g tech n iq u es and le a r n in g m a t e r i a l s .

9.

Adequate f in a n c in g based on broad p u b lic s u p p o rt.

10.

e x te n s io n a d m i n i s t r a t i o n .

V iable communication t o and from, and working r e l a t i o n ­
s h ip w ith in d iv id u a l s t u d e n t s , c l i e n t e l e groups and
s i s t e r a g e n c i e s . 18
While th e s e f a c t o r s vary in scope and some a re more complex

than o t h e r s , they do provide a u s e fu l i n d i c a t i o n o f th e broad range

10

o f concerns t h a t must be c o n sid e re d in d esig n in g and implementing
c o lle g e and u n i v e r s it y - b a s e d small b u s in e s s a s s i s t a n c e programs.
The i s s u e s ad d ressed in t h i s s tu d y a r e d e riv e d from th e
w r i t e r ' s review o f th e l i t e r a t u r e and a c a r e f u l stu d y o f th e e x p e r i ­
ences o f e i g h t p i l o t Small Business Development C en ter programs as
r e p o rte d in v a rio u s C ongressional h e a r in g s , d e s c r i p t i v e m a t e r ia ls and
management r e p o r t s produced by th e d i r e c t o r s o f p i l o t SBDC programs
a t an in fo rm a tio n s h a rin g con ference h eld in A thens, Georgia on
September 25-27, 1978.

The i s s u e s a l s o r e f l e c t concerns a r i s i n g from

th e program development r e s p o n s i b i l i t i e s o f th e w r i t e r .

The s p e c i f i c

concerns ad d ressed in t h i s s tu d y a re as fo llo w s :
Concern 1 - The p o t e n t i a l f o r i n t e g r a t i n g th e small b u s i ­
ness a s s i s t a n c e program w ith th e i n s t r u c t i o n a l
program o f th e b u s in e s s c o l l e g e /s c h o o l.
Concern 2 - The p o t e n t i a l f o r i n t e g r a t i n g th e small b u s i­
ness a s s i s t a n c e program w ith th e re se a rc h
a c t i v i t i e s o f th e b u s in e s s c o l l e g e /s c h o o l.
Concern 3 - The p o t e n t i a l f o r i n t e g r a t i n g th e small b u s i ­
ness a s s i s t a n c e program w ith th e s e r v i c e
a c t i v i t i e s o f th e b u sin e ss c o ll e g e /s c h o o l.
Concern 4 - The ty p e o f small b u s in e s s a s s i s t a n c e program
model t h a t would be most e f f e c t i v e .
Concern 5 - The ty p es o f small b u s in e s s e s t h a t should
r e c e iv e a s s i s t a n c e .
Concern 6 - The re s o u rc e requ irem en ts and funding a rra n g e ­
ments f o r i n i t i a t i n g a small b u s in e s s a s s i s t a n c e
program.
Concern 7 - The most a p p r o p r ia te s t r u c t u r e f o r a d m in is te r in g
and c o o r d in a tin g a s ta te w id e program.

11

These s t r a t e g i c i s s u e s w i l l p ro v id e th e broad focus f o r th e
r e s e a r c h in t h i s s tu d y .

The r e s e a r c h problem, t h e n , i s to se c u re

s t r a t e g i c "advice" from th e b u sin e ss c o lle g e deans in M ich ig an 's p u b lic
h ig h e r e d u c a tio n i n s t i t u t i o n s concerning s p e c i f i c i s s u e s w ith in each
o f th e s e is s u e a r e a s .
S ig n ific a n c e o f th e Study
The s i g n i f i c a n c e o f th e stu d y i s r e l a t e d to th e follow in g p o in ts :
(1) i t w i l l p rovide s p e c i f i c in fo rm atio n t o th e r e s p e c t i v e p o lic y makers
involved in developing th e s t a t e SBDC plan concerning th e range o f
agreement and disagreem ent on th e i s s u e s e x p lo re d ; (2) such in fo rm atio n
w ill enable p o lic y makers from th e v a rio u s i n s t i t u t i o n s t o a p p r a is e
t h e i r own p o s it i o n s w ith re g a rd to th e program m atic, o r g a n iz a tio n a l
and a d m i n is tr a t iv e q u e s tio n s , and t o un derstand more f u l l y th e views
o f o th e r i n s t i t u t i o n a l r e p r e s e n t a t i v e s ; (3) a more s e n s i t i v e und erstand ing
o f th e needs and concerns o f h ig h e r e d u c a tio n i n s t i t u t i o n s on th e p a r t o f
government o f f i c i a l s should r e s u l t from t h i s s tu d y ; (4) a plan f o r
d e l i v e r i n g small b u sin e ss s e r v ic e s which i s s e n s i t i v e t o i n s t i t u t i o n a l
needs and concerns should r e s u l t 1n improving th e outcomes o f p u b lic
h ig h e r ed u catio n In M ichigan; and (5) th e i s s u e s i d e n t i f i e d and examined
in t h i s stud y w i l l provide guidance to o f f i c i a l s in o t h e r s t a t e s
who a r e o r w i l l be u n d ertakin g th e r e s p o n s i b i l i t y f o r d ev eloping p lan s
in t h e i r r e s p e c ti v e s t a t e s f o r c o o p e ra tin g w ith c o l l e g e s and u n i v e r s i ­
t i e s in a s s i s t i n g small b u s in e s s e s .

12

Research Design
In o r d e r to develop th e in fo rm a tio n needed, in -p e rs o n in te rv ie w s
w i l l be conducted w ith th e b u s in e s s deans a t each o f M ich igan 's p u b lic
f o u r - y e a r c o lle g e s and u n i v e r s i t i e s .

This w i l l in c lu d e t h e fo llo w in g

in stitu tio n s:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.

C en tral Michigan U n iv e r s ity
E astern Michigan U n iv e rs ity
F e r r i s S t a te C ollege
Grand V alley S t a t e C ollege
Lake S u p erio r S t a t e C ollege
Michigan S t a t e U n iv e r s ity
Michigan Technological U n iv e r s ity
Northern Michigan U n iv e r s ity
Oakland U n iv e rs ity
Saginaw V alley C ollege
U n iv e r s ity o f M ichigan, Ann Arbor
U n iv e r s ity o f M ichigan, Dearborn
U n iv e r s ity o f M ichigan, F l i n t
Wayne S t a t e U n iv e r s ity
Western Michigan U n iv e r s ity
The b u sin e ss deans o f th e p u b lic f o u r - y e a r c o lle g e s and u n iv e r­

s i t i e s a r e th e prim ary u n i v e r s i t y a d m i n i s t r a t o r s who, presum ably, w ill
be d i r e c t l y invo lved in developing and approving a s t a t e small b u sin ess
development c e n t e r p lan .
A l e t t e r w il l be s e n t t o each o f th e b u s in e s s deans inform ing
them o f th e purpose o f th e stud y and inform ing them t h a t an appointm ent
w i l l be made t o d is c u s s th e Small Business Development C enter concept
w ith them.
An In te rv ie w guide w ill be developed t h a t i s both h ig h ly
s t r u c t u r e d and semi s t r u c t u r e d to p erm it th e in t e r v i e w e r t o probe more
deeply i n t o th e resp on ses to o b ta in more complete d a t a .

The in te rv ie w s

w ill be recorded on a ta p e r e c o r d e r t o f a c i l i t a t e d e t a i l e d a n a l y s i s .
Two p i l o t t e s t i n g s o f th e In te rv ie w sch ed ule w ill be performed
so t h a t any problems i n th e in te rv ie w form at can be i d e n t i f i e d and

13

c o r r e c te d p r i o r t o conducting th e s tu d y .

The p i l o t t e s t i n g w i l l be

conducted w ith th e b u s in e s s deans a t two o f th e f i f t e e n i n s t i t u t i o n s .
The t r i a l in te rv ie w s w ill n o t be in c lu d e d i n th e s tu d y .
The a n a ly s is o f th e d a ta c o l l e c t e d from th e t h i r t e e n i n t e r ­
views w il l be r e p o rte d in d e s c r i p t i v e and summary s t a t i s t i c a l form ats
w ith accompanying n a r r a t i v e .

The a n a l y s is o f th e in te rv ie w d a ta w ill

n o t employ i n f e r e n t i a l s t a t i s t i c a l a n a ly s is o r te c h n iq u e s because th e
e n t i r e p o p u la tio n o f i n t e r e s t w i l l be in te rv iw e d .

C onsequently, th e

r e s u l t s and co n clu sio n s w i ll be based upon th e t o t a l p o p u la tio n r a t h e r
than a sample o f i t .
Scope and L im ita tio n s
Scope
This stu dy i s d e lim ite d to in c lu d e only p u b lic f o u r - y e a r c o lle g e s
and u n i v e r s i t i e s in Michigan.

The stu d y i s a l s o d e lim ite d t o in c lu d e

th e respo nses o f t h i r t e e n deans o f c o lle g e s o f b u s in e s s and management
a t th e i n s t i t u t i o n s in clu d ed in th e r e s e a r c h p o p u la tio n .
L im ita tio n s
The s tu d y i s li m i t e d by th e e x t e n t t o which th e s i g n i f i c a n t
i s s u e s t h a t a r e r a i s e d in th e l i t e r a t u r e on t h i s s u b j e c t have been, o r
have n o t been, i d e n t i f i e d and examined in t h i s s tu d y .

The stu d y i s a l s o

l im ite d by th e r e l i a b i l i t y o f th e d a ta c o l l e c t e d by th e in te r v ie w method.
Overview o f th e Study
The stu d y w i l l be r e p o rte d in f i v e c h a p t e r s .

C hapter I w i ll

in c lu d e th e i n t r o d u c t i o n , th e s i g n i f i c a n c e o f th e s tu d y , th e r e s e a r c h

14

problem, th e r e s e a r c h d e s ig n , d e f i n i t i o n s o f te rm s , scope and l i m i t a ­
t i o n s o f th e s tu d y , and an overview o f th e s tu d y .
Chapter II w i l l in c lu d e a review o f th e l i t e r a t u r e r e l a t e d t o
th e stu d y and a l s o w i l l in c lu d e a review o f th e e v o lu tio n o f th e small
b u s in e s s development c e n t e r program and th e e x p e rie n c e s o f h ig h e r edu­
c a tio n i n s t i t u t i o n s i n o t h e r s t a t e s in p ro v id in g e d u c a tio n a l and techn i
cal s e r v ic e s t o small b u s in e s s e s .
Chapter I I I w i l l d e s c r ib e th e stu d y d esig n and p rocedures
employed in c a r r y in g o u t th e s tu d y .
C hapter IV w i l l c o n ta in a summary and a n a l y s i s o f th e d a ta
c o l l e c t e d from th e su rvey.
C hapter V w i ll c o n ta in a summary o f th e f i n d i n g s , c o n c lu s io n s ,
and recommendations.

15

NOTES--CHAPTER I

Ijo h n J . Corson, c i t e d in C harles G. Dobbins and Calvin B. T.
Lee ( e d s . ) , Whose Goals f o r American H igher Education (Washington D.C.:
American Council on E d u c atio n , 1968), p7 83.
2I b i d . , pp. 84-86.
^Durward Long, "The U n iv e r s ity As Commons: A View From Adminis
t r a t i o n , " New D ir e c tio n s in Higher E d u c atio n , No. 18 (Summer, 1977),
p. 82.
4 I b i d . , p. 82.
5Corson» op. c i t . , p. 89.
6Long, o p . c i t . , p. 85.
7Theodore J . Shannon and C laren ce A. S h o en feld , U n iv e r s ity
Extension (New York: C en ter f o r A pplied Research in E d u catio n , 1965),
p. 73.
Sjohn A. Welsh, P r o f i t and Cash Flow Management f o r NonF in a n c ia l Managers ( D a ll a s , Texas: School o f Business A d m in is tr a tio n ,
Southern M eth od ist U n i v e r s i t y , 1974), p . 4.
^Harold K. C h ariesw o rth , "U rgently Needed: A Reordering o f
SBA P r i o r i t i e s t o Save Small B u s in e s s e s ," MSU B usiness Topics (Summer,
1972), pp. 45-57.
^ T h e B usiness F a il u r e Record (Business Economics D iv isio n o f
Dun & B r a d s t r e e t , I n c . , 1978), pp. 12-13.
^ J o h n A. Welsh, Procedi nos o f th e Second Annual Seminar,
I n v e s tin g in th e E n tre p re n e u r (Dallas': Caruth I n s t i t u t e , Southern
M etho dist U n i v e r s i t y , 1974), pp. 8-10.
^2Alden S. Bean, Dennis D. S h i f f e l and Mary S. Mogee, The
V enture C a p ita l Market and T echnological In no vatio n (Paper subm itted
t o O f fic e o f N ational Research and Development A ssessm ent, National
S cien ce F o un dation , Washington D .C ., 1974).

16

13lou1 s C l c c h i n e l l i and Marcia Grad, In no vatio n C en ter and
T echnical A s s is ta n c e to Business Study (Unpublished Report Prepared
f o r th e Michigan Department o f Commerce, 1977), p. 36-38.
T^U.S., Small Business A d m in is tr a tio n , Small Business Development C enter G u id elin es (May, 1978), p. 2.
15U .S ., Small B usiness A d m in is tr a tio n , SBDC:
t l o n s f o r S t a t e P lans (August, 1978).

S pecial I n s t r u c -

I 6 i b i d . , pp. 4-12.
17u.S. S e n a te , S e l e c t Committee on Small B u sin ess, Hearings on
Small Business Development C en ter Program s. 95th Cong., 1 s t S e s s . ,
pp. 242-243.

CHAPTER II
SMALL BUSINESS:

A NON-TRADITIONAL CLIENTELE IN NEED
I n tr o d u c tio n

During r e c e n t Congressional h e a rin g s on th e "F utu re o f Small
Business in America," th e House Committee on Small Business heard
numerous w itn e ss e s from government, academia and th e small b u sin e ss
community t e s t i f y to th e im p o rtan t r o l e p layed by small b u sin e ss in our
economyJ

/\s a p ro v id e r o f j o b s , as a d e t e r r e n t to high p r i c e s and

monopoly power, and as th e well s p rin g o f th e in n o v a tio n and develop­
ment t h a t have made our n a tio n a world l e a d e r in te c h n o lo g ic a l advances
and s ta n d a rd o f l i v i n g , th e small b u s in e s s s e c t o r ' s re c o rd i s u n su r­
p assed.

I t i s th e small b u sin e ss community t h a t has been, and c o n tin u e s

t o be, th e t r a d i t i o n a l vanguard o f th e f r e e e n t e r p r i s e system .
The co m m ittee's f o r e s i g h t h e a rin g s on th e "F u tu re o f Small
Business in America: were th e f i r s t o f t h e i r kind in th e h i s t o r y o f th e
U.S. Congress.

Testimony re c e iv e d d u rin g th e h e a rin g s ex p ressed th e

r e c u r r e n t themes t h a t th e f e d e r a l government has c o n s i s t e n t l y ignored
th e small b u s in e s s s e c t o r , d e s p i t e s t a t u t o r y r h e t o r i c t o th e c o n t r a r y ,
and has f a i l e d to c o n s id e r p r o p e rly th e f u t u r e impact o f co n g re ss io n a l
p o lic y on t h i s m assive and major segment o f o u r economy.

In summariz­

ing t h e i r views on th e r o l e and im portance o f small b u s in e s s , th e
co m m ittee's r e p o r t s t a t e d :

17

18

The a tte m p t to seek to p re se rv e and s tr e n g th e n small
b u sin e ss o p p o r tu n i t i e s does n o t grow from some mis­
placed f e e l i n g o f n o s t a l g i a . I n s t e a d , th e subcommittee
wants to p re se rv e th e o p p o r t u n i t i e s , th e g e n iu s , th e
e n e r g ie s and th e a s p i r a t i o n s o f th e American way o f
l i f e f o r f u t u r e g e n e r a tio n s . This i s n o t j u s t th e op­
p o r tu n i t y t o s t a r t a b u s in e s s , im p o rta n t as 1 t i s f o r
th o se who d e s i r e t o do s o . I t i s a l s o Im p o rtan t t o
p re s e rv e f o r th e consumer th e freedom o f ch oice o f both
p ro d u ct and s e r v i c e s - in q u a l i t y , p r i c e , value and
a v a i l a b i l i t y . For t h i s r e a s o n , economic d i v e r s i t y must
be f o s t e r e d and c o m p e titio n , through a p l u r a l i t y o f
c o m p e tito rs , must be s tre n g th e n e d as th e only t r u e
hedge a g a i n s t growing c o n c e n tr a tio n . The n a t u r a l a l l y
o f th e consumer i s , t h e r e f o r e , small b u s i n e s s . 2
D efining Small Business
For many y e a r s Americans have p rid e d them selves in being
s u c c e s s fu l small b u sin essp erso n s o r e n t r e p r e n e u r s .

Indeed, major

American c o r p o ra tio n s have grown from th e e f f o r t s o f such men and
women.

Herman Lay (The F r i t o Lay C o r p o r a tio n ) , Conrad H ilto n (The

H ilto n C o r p o r a tio n ) , Henry Ford (The Ford Motor Company) and M argaret
Rudkin (Pepperidge Farms, I n c .) a r e persons who had an id ea f o r a small
b u sin ess which e v e n tu a lly grew i n t o a very la r g e e n t e r p r i s e .
persons a r e , however, anomalies in th e U.S. economy.

These

In f a c t , Bureau

o f Census s t a t i s t i c s i n d i c a t e t h a t 98% o f a l l b u s in e s s e s in th e United
S t a t e s employ fewer than 50 p e o p l e .3
The d e f i n i t i o n o f a small b u s in e s s v a r i e s from so urce t o s o u rc e .
For example, in 1947, th e Committee f o r Economic Development d e fin e d
small b u s in e s s as having two o r more o f th e fo llo w in g c h a r a c t e r i s t i c s :
(1)
(2)
(3)
(4)

independent management ( i t i s g e n e r a ll y ownermanaged);
ow ner-supplied c a p i t a ;
mainly lo c a l in i t s a re a o f o p e r a tio n ; and
r e l a t i v e l y small s i z e w ith in i t s i n d u s t r y . 4

19

When th e Small Business Act was passed in 1953, th e re b y c r e a t ­
ing th e Small Business A d m in istra tio n (SBA), th e f e d e r a l government
began fo rm ally t o s u p p o rt small b u s in e s s e s .
a small b u s in e s s was posed to th e SBA.

The problem o f d e f in in g

The b a s ic SBA c r i t e r i a f o r

a small b u s in e s s a r e :
(1)
(2)

in d ep en d en tly owned and o p e ra te d ; and
n o t dominant in i t s f i e l d o f o p e r a tio n s .
Because th e SBA i s charged w ith p ro v id in g small b u s in e s s e s with

f i n a n c i a l , management and te c h n ic a l a s s i s t a n c e , as well as a s s i s t a n c e
in p ro c e ss in g government c o n t r a c t s , f u r t h e r d e f i n i t i o n o f small b u s i ­
n esses was r e q u ir e d .

The new d e f i n i t i o n o f

small b u s in e s s e s was based

on q u a n t i t a t i v e measures ( e . g . , income, number o f employees) w ith in
p a r e n t i n d u s tr y .

a

For example, a r e t a i l b u sin e ss i s co n sid e red to be a

small b u s in e s s i f i t s annual r e c e i p t s do n o t exceed $1 m i l l i o n , whereas
a l l m anufacturing firm s a r e c o n sid e re d small i f they employ fewer than
250 p erso n s.

However, a m anufacturing firm employing between 250 and

1500 persons may s t i l l be co n s id e re d a small b u s in e s s by th e SBA de­
pending on th e s p e c i f i c in d u s tr y o f which i t i s a p art.®
Perhaps th e most d e f i n i t i v e s ta te m e n t o f Congressional i n t e n t ,
in re g a rd to s i z e s ta n d a r d s , was in clu d ed in th e Twenty T h ird Annual
Report o f th e S e l e c t Committee on Small B u sin e ss, r e l e a s e d 1n 1973.
I t s ta te d :
The Small Business Act c o n ta in s a very g eneral d e f i n i t i o n
1n terms o f a fir m which i s : " in d ep en d en tly owned and
o p erated and . . . n o t dominant in i t s f i e l d o f o p e r a t io n ."
The S t a t u t e leav es th e f u r t h e r and more d e t a i l e d d e f i n i ­
t i o n t o th e Small Business A d m in istra tio n to be worked
o u t a d m i n i s t r a t i v e l y , w ith r e fe r e n c e t o two c r i t e r i a —
number o f employees and d o l l a r volume o f b u s in e s s —among
o th e r s .

20

The SBA, p u rsu a n t t o t h i s mandate, has developed a dual
system o f d e f i n i t i o n s which stem from th e e l i g i b i l i t y
f o r SBA's two most im p o rta n t f u n c t i o n s ; f i n a n c i a l a s s i s t ­
ance and procurem ent a s s i s t a n c e .
I t has been SBA p r a c t i c e t o c o n s id e r s i z e s ta n d a rd s on
an i n d u s t r y - b y - i n d u s t r y b a s i s . The r e s u l t s a r e con­
t a i n e d in SBA r e g u l a t i o n s . H earings a r e h e ld when
n e c e ssa ry t o modify th e s ta n d a rd s and b rin g t o l i g h t
r e l e v a n t d i s t i n c t i o n s w ith in each s e p a r a t e in d u s t r y
c a te g o ry .
While t h i s approach t o d e f i n i t i o n s i s advantageous f o r
SBA 1n a d m in is te r in g i t s program s, t h e i r very f l e x i ­
b i l i t y may lead to co n fusio n in th e p u b lic mind over th e
" tru e " domain o f small b u s in e s s .
This co nfu sio n i s compounded by th e f a c t t h a t o th e r
departm ents and agencies have adopted s i z e s ta n d a rd s
which a r e s i m i l a r l y f u n c tio n a l f o r purposes o f
a d m in is te r in g t h e i r p a r t i c u l a r programs . . . .
This e x p la n a tio n should i l l u s t r a t e th e d i f f i c u l t y o f
f in d in g a sim ple d e f i n i t i o n f o r "small b u s in e s s ." The
committee sometimes b e lie v e s i t advantageous t o th in k
o f i t s a re a s o f concern as embracing new, growing, and
fam ily and o t h e r ind epend en t b u s i n e s s . 7
D esp ite th e v a r i a t i o n o f d e f i n i t i o n s o f small b u s in e s s e s , two
b a s ic elem ents a r e g e n e r a ll y in c lu d e d :

th e b u s in e s s i s owned and

managed by th e same p e rso n , and t h a t person has p r i v a t e c a p i t a l a t
ris k .8
The S t r u c t u r e o f th e American Economy
P r o f e s s o r John Kenneth G a lb r a ith c h a r a c t e r i z e s th e modern
American economy as a "bimodal s t r u c t u r e . " 8

One p a r t o f t h i s s t r u c t u r e

i s composed o f a small number o f firm s o f very la r g e p r o p o r ti o n s ; th e s e
f ir m s , acco rd in g t o G a l b r a i t h , comprise h a l f o f th e p r i v a t e s e c t o r and
acco un t f o r h a l f o f th e t o t a l p r i v a t e p ro d u c t.

21

The Bureau o f Economics a t th e F ederal Trade Commission has
developed d a ta which show t h e growth o f firm s in th e dom inating p a r t
o f th e economy.

In 1960, t h e r e were 141 firm s w ith a s s e t s o f $250

m i l l i o n ; th e y c o n t r o l l e d 52 p e r c e n t o f a l l m an ufacturing a s s e t s .

By

1976, t h e i r number had in c r e a s e d t o 466 firm s which c o n t r o ll e d 72
p e r c e n t o f a l l m anu facturin g a s s e t s .

In t h a t same y e a r , t h e r e were

162 firm s w ith a s s e t s o f $1 b i l l i o n and they c o n t r o l l e d 55 p e rc e n t
o f a l l m anufacturing a s s e t s . 10
P r o f e s s o r C h arles M ueller e s tim a te s t h a t app roxim ately onet h i r d o f our n a t i o n 's economy i s s u b j e c t t o th e r u l e o f m o n o p o listic
and o l i g o p o l i s t i c f o r c e s . 11

M u eller p ro v id e s d a ta t h a t i l l u s t r a t e

th e s i z e o f th e b u s in e s s e s t h a t p o p u la te th e c o n c e n tra te d p a r t o f th e
economy:
In 1971, f o r example, t h e r e were 12.4 m i llio n b u sin e ss
e n t e r p r i s e s o f a l l s i z e s and kinds in America, in c lu d in g
3 .3 m il l i o n farm s. Of t h a t 12.4 m i l l io n t o t a l , however,
ov er h a l f o f them ( 6 .4 m i l l io n ) had g ro ss s a l e s o f l e s s
th an $10,000! A nother 3 .4 m i llio n f a i l e d t o reach
$50,000 in s a l e s and s t i l l a n o th e r 1 m i l l i o n g o t only as
high as $100,000 in y e a r l y s a l e s . A lto g e th e r t h e n , n e a rly
11 m i ll i o n o f th e n a t i o n 's 12.4 m i llio n firm s - 87.2
p e r c e n t - had s a l e s o f l e s s than $100,000 t h a t y e a r . 12
With big b u s in e s s i n c r e a s in g i t s s h a re o f th e m arket a t such
a r a p id p a c e , i t i s c l e a r t h a t small b u s in e s s , as a r e s u l t , s u f f e r s a
s u b s t a n t i a l d im in u tio n o f i t s im portance.
"The i m p lic a tio n i s c l e a r :

As C h arles M ueller p u t i t ,

Since b ig b u s in e s s i s s t e a d i l y in c r e a s in g

i t s s h a re o f th e n a t i o n 's economic a c t i v i t y , th e s h a re l e f t to small
b u s in e s s 1s n e c e s s a r i l y d w in d lin g .1,1 ^
The Committee on Small B u s in e ss , in i t s r e p o r t e n t i t l e d , F uture
o f Small Business in America, c o n c lu d e s :

22

Because o f t h e i r s i z e , small firm s do n o t p o ssess th e
measure o f economic power t h a t la r g e firm s do. The
la r g e fir m c a n , t o a g r e a t e x t e n t , i n s u l a t e i t s e l f from
th e f u l l impact o f e x te r n a l m arket f o r c e s , w h ile th e
small firm i s co m pletely s u b j e c t t o th o se f o r c e s . . . .
The small f i r m 's lack o f economic power p re v e n ts i t
from e x e r t i n g any s u b s t a n t i a l c o n tr o l over i t s p r ic e s
and c o s t s ; i t s r e t u r n s , t h e r e f o r e , a r e f a r l e s s s e c u re
than th o s e o f th e l a r g e f ir m . And u n lik e th e la r g e
firm which has huge re so u rc e s o f c a p i t a l a t i t s d i s ­
p o s a l, th e small firm i s o f te n unable t o s e c u re th e
c a p i t a l i t needs t o improve i t s o p e r a tio n s from e i t h e r
th e lending i n s t i t u t i o n s o r i t s own r e t u r n s . 14
At th e same tim e , th e r o l e and s i g n i f i c a n c e o f small b u sin e ss
has n o t d e c lin e d .

The a c t i v i t i e s o f small b u s in e s s e s may range from

o p e r a tin g a c o rn e r g ro cery s t o r e , m o te l, in s u ra n c e agency, o r bowling
a l l e y , t o o p e r a tin g a complex, h ig h -te c h n o lo g y e l e c t r o n i c s m anufacturing
f irm .
trie s.

These small b u s in e s s e s a re th e b a s ic components o f most in d u s ­
F urtherm ore, they a r e in te rd e p e n d e n t.

For example, a small

m anufacturing firm w i l l most l i k e l y r e q u i r e a CPA f ir m , s u p p li e r s o f
p ro d u c t components, s u p p lie r s o f m achinery, and an a t t o r n e y .
As C i c c h l n e l l i and Grad p o i n t o u t , small b u s in e s s e s c l e a r l y
s u p p o rt and s ti m u l a t e th e economic growth o f a community.1^

The i n t e r ­

dependence o f small b u s in e s s e s forms th e b a s is o f a n e a r ly s e l f s u s t a i n i n g income network.

That i s , th e y p ro v id e income f o r and d e r iv e

income from o t h e r small b u s in e s s e s .

They pay t a x e s , p ro v id e major

so u rces o f p u b lic revenue, an d, by t h e i r very n a t u r e , c r e a t e and main­
t a i n co m p etitio n in th e m ark etp la ce.
Small b u s in e s s e s a l s o c r e a t e j o b s .

A r e c e n t M .I.T . stu d y of

th e jo b g e n e ra tio n pro cess in which an a tte m p t was made t o determ ine
th e s i z e o f th e firm s t h a t a r e g e n e r a tin g th e jo b s found th e s e r a t h e r
s trik in g re su lts:

23
(1)
(2)
(3)

S m all, Independent firm s employ 52 p e r c e n t o f a l l
employees;
Medlum-size and la r g e firm s p ro v id e r e l a t i v e l y
few new j o b s ; and
T w o-thirds o f a l l new jo b s in th e U.S. a r e g e n e r­
a te d by small firm s ( i . e . , th o se w ith 20 o r fewer
e m p lo y e e s).16
Whv Small B u sinesses F ail
There have been s e v e ra l d e t a i l e d s t u d i e s on th e reaso ns f o r

f a i l u r e o f small f ir m s , p r im a r ily in th e United S t a t e s .

Hoad and

Rosko, f o r example, s tu d i e d ap proxim ately 100 Michigan m an ufacturers
which s t a r t e d t h e i r b u s in e s s e s in 1960.1?

of t h i s sam ple, a p p ro x i­

m ately 33% had f a i l e d by th e time o f t h e i r stu d y in 1964 and 25% were
only m a rg in a lly s u c c e s s f u l .

They found t h a t th e s in g l e most im p o rtan t

c h a r a c t e r i s t i c was an i n a b i l i t y to f in d a p r o f i t a b l e m arket.

This

appeared t o be th e r e s u l t o f a lack o f m arketing s k i l l s w ith in th e
companies.

According to them, and c o n tr a r y t o p o p u la r b e l i e f , lack o f

c a p i t a l , i n a b i l i t y t o c o l l e c t from customers and poor re c o rd keeping
r a r e l y caused f a i l u r e .

The more im p o rtan t f a c t o r s , in t h e i r s tu d y ,

in clu d ed o v e r-e x te n s io n o f th e company in terms o f p l a n t and equipm ent,
u n r e a l i s t i c p r i c i n g , d isagreem ent among co-owners and la c k o f t r a i n i n g
and e x p e rie n c e .

They a l s o commented on s tr e n g t h s o f th e small firm s

ov er l a r g e r f ir m s .

These in clu d ed low o verhead, good p erson al c o n ta c ts

w ith cu sto m ers, and a r e p u t a t io n f o r a high q u a l i t y work f o r c e as th e
primary f a c t o r s w ith o t h e r a re a s such as f l e x i b i l i t y and s p e c i a l i z a t i o n
being g eneral c h a r a c t e r i s t i c s o f such firm s as w e ll .
Another stu d y o f f a i l u r e s was conducted by Mayer and G o ld s te irn
in which 80 small r e t a i l and s e r v i c e firm s were s tu d ie d over a tw o-year

24

p e rio d t o determ ine th e f a c t o r s t h a t d is ti n g u i s h e d th e firm s t h a t
f a i l e d from th e firm s which had su rv iv ed d u rin g t h a t p e r i o d . 18

This

stu d y examined f a c t o r s t h a t prompted th e d e c is io n t o s t a r t th e b u s in e s s ,
ch oice o f l o c a t i o n , and tim ing o f th e s t a r t - u p o f th e f irm .

In a d d i­

t i o n , th ey examined c a p i t a l re so u rc e s and o t h e r m ajor f a c t o r s th ey found
t h a t in flu e n c e d success o r f a i l u r e .

The b u s in e s s e s s tu d ie d covered a

wide range o f small s t o r e s , r e s t a u r a n t s and s e r v i c e shops which were
c h a r a c t e r i s t i c o f owner managed firm s which a r e u s u a lly self-em plo y ed
i n d i v i d u a l s w ith no employees.

Thus th e management f u n c tio n s o f th e s e

firm s were very elem entary and th e owners' t r a i n i n g , i f any, was in
t h e i r r e s p e c t i v e a re a s o f o ccu p atio n al s k i l l .

T his stu dy found t h a t

th e prim ary reason f o r f a i l u r e was lack o f s a l e s r e s u l t i n g from f a u l t y
lo c a ti o n and lack o f r e c o g n itio n o f th e t r u e m arket.
A stu d y in B r i t a i n by Jonathon Boswell which focused on 44
m anufacturing firm s in d ic a te d t h a t performance and growth were i n v e r s e l y
r e l a t e d t o th e age o f th e firm and th e age o f owners b u t n o t r e l a t e d t o
s i z e . 1^

B o sw ell's work r e l a t e d th e problems o f th e s e firm s t o th e prob­

lems o f s u c c e s s io n , and he found t h a t o l d e r firm s were more l i k e l y to
d e c l in e and e v e n tu a lly f a i l because o f th e r i g i d i t i e s o f top-management.
I t a l s o appeared u n l i k e l y t h a t changes would be made in th e m arketing
and o t h e r management a r e a s n e c e ssa ry f o r r e v iv in g th o s e f ir m s .

He

I l l u s t r a t e d s e v e ra l cases in which new management was a b le to p u ll th e
companies o u t o f d e c l i n e and t u r n them i n t o v i a b le e n t e r p r i s e s .
A stud y by R u sse ll Knight examined th e causes o f b u sin e ss
f a i l u r e in small b u s in e s s e s in Canada.^

N early a l l o f th e bankrupt

firm s in th e stu d y (75%) had only one i n d iv id u a l in v o lv ed in managing

25
th e firm .

In most o f th e s e cases (80%), th e background and ex p e rie n c e

o f th e s e I n d iv i d u a l s was t e c h n ic a l o r o p e r a tio n a l in n a t u r e .

These

i n d i v i d u a l s t y p i c a l l y had no ex p e rie n c e o r t r a i n i n g in m ark etin g ,
f in a n c i n g , o r a c c o u n tin g .

While th ey could se c u re f i n a n c i a l and

acco u n tin g a s s i s t a n c e from t h e i r bank manager o r a c c o u n ta n t, th ey had
no r e a d i l y a v a i l a b l e source o f a s s i s t a n c e in th e a re a o f m arketing .
Even in th o se firm s where more than one manager was p r e s e n t , they
f r e q u e n t l y had s i m i l a r backgrounds - u s u a ll y t e c h n ic a l o r o p e r a t i o n a l .
Examples o f t h i s phenomenon in clu d ed c a r p e n te r s who had s t a r t e d t h e i r
own c o n s tr u c t i o n f i r m s , m a c h in is ts who had opened t h e i r own machine
shops, tru c k d r i v e r s who had s t a r t e d t h e i r own tru c k in g companies,
and people who had worked in a r e s t a u r a n t o r motel t r y i n g t o run t h e i r
own b u s in e s s e s in th o s e a r e a s .

All o f th e s e i n d i v id u a l s were re a so n ­

ab ly q u a l i f i e d in th e o p e r a tio n a l a r e a s b u t d id n o t seem t o understand
th e m a rk e tin g , f i n a n c i a l and acco u n tin g end o f t h e i r b u s in e s s because
they had never been exposed t o management f u n c tio n s in t h e i r p rev iou s
work e x p e rie n c e o r t r a i n i n g .

Thus, many o f th e bankrupt firm s s tu d ie d

had f a i l e d t o keep re a so n a b le f i n a n c i a l r e c o r d s , had no con cept o f cash
flo w , and were in t r o u b l e from th e day o f t h e i r fo rm atio n .
Much o f th e l i t e r a t u r e i n d i c a t e s t h a t most small b u s in e s s owners
have n o t been exposed t o p r o f e s s io n a l management p r i o r t o e s t a b l i s h i n g
t h e i r own b u s in e s s .

In most i n s t a n c e s , th e y a re e n tr e p re n e u r s who have

been s u c c e s s fu l i n th e p a s t w ith o u t having t o plan s y s t e m a t i c a l l y .
Fogel p o in ts o u t t h a t th e d i s c i p l i n e r e q u ire d f o r plann ing i s one
c h a r a c t e r i s t i c t h a t i s u s u a lly m issing from e n tr e p r e n e u r s .

He say s:

Isaac

26
The planning p rocess ta k e s tim e. Many small b u s in e s s owners
see t h e i r f u n c tio n more 1n th e o p e r a tio n s a re a than in th e
management a r e a . T h e re f o re , th ey f e e l t h a t th ey a r e n o t
making a c o n t r ib u t i o n t o th e company u n le ss th e y a r e involved
p h y s ic a l l y . Spending f o u r weeks a y e a r t o p lan what a small
b u s in e s s w i l l be doing o v er th e n e x t 12 months, o f te n seems
t o be a waste o f v a lu a b le tim e , t h a t could be b e t t e r s p e n t
on p u t t i n g o u t th e e x i s t i n g f i r e s . What most small b u s in e s s
owners do n o t r e a l i z e i s t h a t p lan n in g i s a form o f f i r e
p re v e n tio n as opposed t o f i r e f i g h t i n g . 21
Yvon Gasse observes t h a t much o f th e su ccess o f a small firm
in th e e a r l y s ta g e s o f i t s development i s t h e r e s u l t o f th e a b i l i t y
o f and c a p a c ity o f th e owner-manager t o c a r r y in h i s head knowledge
o f th e d e t a i l e d o p e r a tio n o f a l l a s p e c ts o f h i s b u s in e s s and t o remain
in e f f e c t i v e c o n tro l o f each a c t i v i t y .
The owner-manager's p o l i c i e s and te c h n iq u e s evolve more
from th e custom and p r a c t i c e o f t r i e d and t e s t e d d e c is io n s
in p a r t i c u l a r s i t u a t i o n s than from any a tte m p t t o i d e n t i f y
and s ta n d a r d iz e p a r t i c u l a r p r i n c i p l e s , g u i d e l i n e s , and
p ro c e d u re s ; t h e r e f o r e , th e e n tr e p r e n e u r w i l l ten d t o
p e r p e tu a te h is Inform al way o f doing th in g s u n t i l th e
growth o f h is firm w i l l reach a p o i n t where he w i l l begin
t o lo s e c o n tro l u n le ss a formal management system 1s
in tro d u c e d to supplement h is p erson al r u l e s . “
There i s a g r e a t deal o f agreement in th e l i t e r a t u r e concerning
th e phenomenon t h a t as a firm grows in s i z e , th e d i r e c t , f a c e - t o - f a c e
i n t e r a c t i o n which c h a r a c t e r i z e d l i f e in th e b eginning g iv es way t o more
fo rm a l, l e s s d i r e c t modes o f s u p e r v i s io n .

A rgenti d e s c r ib e s th e p rocess

t h i s way:
The e n tr e p r e n e u r no lo n g e r can keep a p erso nal hand in
a l l th e major f u n c tio n s o f th e f irm . His d e c is io n s about
who t o h i r e as a s s i s t a n t s , how t o d e f in e jo b r e s p o n s i ­
b i l i t i e s , and how t o s p e c i f y work f lo w s , assume a g r e a t e r
im portance. He r i s k s s e v e re problems o f communication,
c o o r d in a tio n , and c o n t r o l . In th e p a s t , a company could
grow t o a c o n s id e ra b le s i z e and s t i l l be managed in th e
same way as when i t was s m a ll. Given s u f f i c i e n t energy
and co u rag e, f l a i r , and common s e n s e , an e n tr e p r e n e u r
could b u ild a company o f alm ost any s i z e and s t i l l remain

27

in command. Today he cannot do t h i s because b u s in e s s
problems have become so complex, co m p etitio n has become
so s tr o n g and th e r a t e o f chance I s so s w i f t . . . .
At some p o i n t , th e e n t r e p r e n e u r begins to l o s e c o n tr o l
u n le ss a formal management system i s In tro d u c e d t o
supplem ent, a t l e a s t , h i s p erso nal r u l e . I t 1s n o t
p o s s i b l e t o say when a company w ill reach t h i s p o in t .
All t h a t can be s a id 1s t h a t companies today reach 1 t
much e a r l i e r th an th ey used t o . 23
U n iv e r s ity Responses to Small B usiness Needs
The small b u s in e s s community today i s much l i k e th e a g r i c u l ­
t u r a l community o f th e l a t e 19th and e a r l y 20th c e n t u r i e s .
t u r a l e s ta b lis h m e n ts were r e l a t i v e l y s m a ll.

The a g r i c u l ­

T h e ir owners had l i t t l e

ex p e rie n c e and u s u a lly no formal t r a i n i n g in o p e r a tio n s and management.
T h e ir a c c e s s t o m arket in fo rm a tio n was l i m i t e d .

They lacked knowledge

abo u t a v a i l a b l e te c h n o lo g y , f i n a n c i a l r e s o u r c e s , m a t e r i a l s , p r o c e s s e s ,
and te c h n iq u e s .

In f a c t , most o f th e p r e s e n t p r o d u c ts , p r o c e s s e s ,

m a t e r i a l s , and technology were y e t to be developed.

The small farm er

faced a b u i l t - i n c o m p e titiv e d isa d v a n ta g e w ith l a r g e r co m p etito rs and
was a t th e mercy o f o t h e r segments o f s o c i e t y .

The small b u s in e s s

segment o f s o c i e ty today has th e same problems and can p r o f i t from a
g o v e rn m e n t-u n iv e rsity -sm a ll b u s in e s s p a r t n e r s h i p as has t h e a g r i c u l t u r a l
segment.
Schools o f b u s in e s s th ro u g h o u t th e co u n try have f o r h a l f a
c e n tu ry been p ro v id in g s e r v i c e s t o th e b u s in e s s community.

Each y e a r

s e v e ra l thousands o f b u s in e s s p e rs o n s a t t e n d c o l l e g e and u n i v e r s i t y
sem inars and s h o r t c o u r s e s .

Thousands more b e n e f i t from r e s e a r c h o r

p r o v is io n o f needed in fo rm a tio n .

However, th e r e s o u r c e s made a v a i l a b l e

f o r th e s e s e r v i c e s have been r e l a t i v e l y meager.

28

The purpose o f t h i s s e c t io n 1s to review th e s t a t u s o f c o lle g e
and u n i v e r s i t y e d u c a tio n a l programs and c o n s u ltin g s e r v i c e s t h a t a r e
s p e c i f i c a l l y designed f o r p r a c t i c i n g and p o t e n t i a l small b u s in e s s
managers and e n tr e p r e n e u r s .
E ducational Programs f o r Small B usinesses
I n t e r e s t in th e management t r a i n i n g o f owners and p ro s p e c tiv e
owners o f s m a lle r b u s in e s s e s appears t o be growing s i g n i f i c a n t l y .
Since 1967, th e number o f u n i v e r s i t i e s o f f e r i n g e n tr e p r e n e u r s h ip
co urses has in c r e a s e d to more than e i g h t y —an i n c r e a s e o f ov er 800
p e rc e n t d u rin g th e l a s t te n y e a r s .

However, d e s p it e t h i s development,

th e r e l a t i v e number o f c o ll e g e s and u n i v e r s i t i e s o f f e r i n g co u rses in
e n tr e p r e n e u r s h ip remains s m a l l . ^
A 1977 stu d y conducted by th e I n t e r n a t i o n a l Council f o r Small
Business surveyed o v er 400 u n i v e r s i t i e s and c o l l e g e s ( a l l members o f
th e American Assembly o f C o l l e g i a t e Schools o f B usiness) t o determ ine
how many sch o o ls were o f f e r i n g co u rses in e i t h e r e n t r e p r e n e u r s h ip o r
small b u s in e s s management.

The stu dy re v e a le d t h a t approx im ately 50

p e rc e n t o r 200 o f th e c o lle g e s and u n i v e r s i t i e s surveyed o f f e r e d courses
and programs in th e s e a r e a s . 25
The " e n tre p re n e u r" and th e "small b u s in e s s manager" a re n o t
n e c e s s a r i l y synonymous term s.

The emphasis in e n tr e p r e n e u r s h ip i s on

th e "development o f something new w ith re g a rd t o th e o r g a n i z a t i o n ,
p r o c e s s e s , p r o d u c ts , o r o t h e r s i g n i f i c a n t a s p e c ts o f a b u s in e s s .
The owner-manager o f a small b u s in e s s may o r may n o t be an e n t r e p r e ­
n eur.

The work o f th e owner-manager c e n t e r s around "keeping h is

29
b u s in e s s a f l o a t and perhaps in c r e a s in g s a l e s and p r o f i t s by g r a d u a lly
expanding th e p r e s e n t o p e r a t i o n . "27
The themes o f small b u sin e ss e d u c a tio n a l programs a r e becoming
more s o p h i s t i c a t e d , b u t f o r th e most p a r t s t i l l f a l l w ith in th e scope
o f t r a d i t i o n a l b u s in e s s a c t i v i t i e s .

Table 1 d is p la y s th e degree o f

emphasis p laced on th e c o n te n t o f small b u s in e s s programs as determ ined
by a survey stu d y conducted by th e N ational Council f o r Small Business
Management Development.

Eighteen common to p i c s were l i s t e d in th e

q u e s ti o n n a i r e and resp o n d en ts were asked to i n d i c a t e by t h r e e d e g re e s —
low, medium, h ig h —th e emphasis p laced on each o f th e s e e ig h te e n to p ic s
in th e c o n te n t o f t h e i r program s.28
The survey stu d y conducted by th e N ational Council f o r Small
Business Management Development re v e a le d o t h e r c h a r a c t e r i s t i c s o f small
b u sin e ss programs o f i n t e r e s t .

The major c l i e n t e l e o r i e n t a t i o n o f th e

small b u s in e s s management programs o f f e r e d by th e respondents i s r e ­
p o rte d in Table 2.

An exam ination o f th e d a ta in T able 2 shows t h a t

over h a l f (55.1%) o f th e programs o f f e r e d were p r im a r i l y o r ie n te d toward
small b u s in e s s e s , e . g . , co vering some t o p i c s o f i n t e r e s t such as
f in a n c in g small b u s in e s s e s , m arketing th e p r o d u c t, e t c . , o r i t was
designed f o r th e in d iv id u a l c o n s id e rin g a c a r e e r in small b u s in e s s .
Approximately 17%, o r 30, o f th e r e p o r te d programs were m in o rity b u s i ­
ness o r ie n t e d .

F i f t y o f th e programs (28%) were o r ie n te d p r im a r ily

toward e x e c u tiv e d e v e lo p m e n t.^
The time p e rio d s f o r cou rse o f f e r i n g s a r e summarized in t h r e e
c a t e g o r i e s in Table 3.

The l a r g e s t number o f program s, 60 o r 51.4%,

were o f f e r e d d u rin g both day and evening h o u rs.

Daytime only programs

30
TABLE 1
EMPHASIS PLACED ON CONTENT OF PROGRAMS
IN SMALL BUSINESS MANAGEMENT

Low

Med

High

A n aly sis o f p o t e n t i a l need f o r a new
small b u s in e s s .........................................................

23

31

34

Financing ......................................................................

2

18

72

........................................

39

35

15

............................................

5

25

60

Long-range p lann ing and f o r e c a s t i n g . . . .

13

37

43

Buying an e x i s t i n g b u sin e ss ...............................

39

34

14

Types o f i n d iv i d u a ls who succeed as
e n tr e p re n e u r s .........................................................

25

39

27

Accounting and in fo rm a tio n systems

12

23

56

.....................................................

21

45

28

L ocation s e l e c t i o n ( r e t a i l , s e r v i c e , o r
m an ufactu rin g) .........................................................

22

38

32

P e rso n n e l, la b o r r e l a t i o n s

...............................

26

38

28

R eporting forms ( t a x , e t c . ) f o r govern­
ment a g e n c ie s .........................................................

32

29

28

SBA a id s a v a i l a b l e

................................................

26

38

28

P roduction management ............................................

39

35

19

Marketing management

............................................

19

40

40

S e rv ic e b u s in e s s management ...............................

24

41

28

M arketing r e s e a r c h

26

30

35

15

30

43

In surance requ irem ents
C a p ita l requ irem ents

P r ic in g s t r a t e g y

. . . .

................................................

Cost c o n tr o ls ......................

...................................

O th e r, e . g . , s u p e rv is o ry management,
s o c ia l r e s p o n s i b i l i t y , in v e n to ry
c o n tro l, c r e d it c o lle c tio n s ,
e t c .....................................................

31
TABLE 2
MAJOR CLIENTELE ORIENTATION OF SMALL
BUSINESS MANAGEMENT PROGRAMS

Number

P e rc e n t

O rien ted toward small b u s in e s s e s o r
designed f o r i n d iv i d u a ls c o n s id e rin g
c a r e e r s in small b u s in e s s e s

98

55.1

M in o rity -b u si ness o r ie n te d

30

16.9

Executive development o r ie n te d

50

28.0

178

100.0

O r i e n ta tio n o f Programs

Total

TABLE 3
TIME PERIODS FOR COURSE/PROGRAM OFFERINGS

Number

P e rc e n t

Daytime Only
(8 a.m. - 4 p.m .)

25

22.5

Evening Only
(4 p.m. - 10 p.m .)

26

23.4

Both day and evening

60

54.1

111

100.0

Time P eriod s

T otal

32

were o f f e r e d by 22.5% o f th e re s p o n d e n ts , w h ile an equal number o f
respondents (23.4%) in d i c a t e d t h e i r programs were o f f e r e d only d uring
th e evening h o u r s . 30
The v a rio u s ty p es o f i n s t r u c t o r s u t i l i z e d in th e programs
a r e d e t a i l e d in Table 4.

The f in d in g s s u g g e st t h a t i t i s a r e l a t i v e l y

common p r a c t i c e o f th e c o lle g e s and u n i v e r s i t i e s to reach o u t i n t o th e
b u s in e s s community f o r i n s t r u c t i o n a l p ersonnel in th e s e more pragm atic
s u b je c t a r e a s . 31
TABLE 4
TYPES OF INSTRUCTORS UTILIZED IN PROGRAMS

Types o f I n s t r u c t o r s
Academicians
(C o lleg e and U n iv e r s ity F a c u lty )
P r a c t i t i o n e r s , e . g . , a c c o u n ta n ts ,
b a n k e rs, management c o n s u l t a n t s ,
government o f f i c i a l s , law y ers, e t c .
Combination o f Academicians and
P r a c t i t i o n e r s U t i l i z e d in Same Program
T otal

Number

P e rc e n t

93

22.2

277

66.1

49

11.7

419

100.0

The l a r g e s t p erc e n ta g e (38%) o f re sp o n d en ts r e p o r t e d t h a t th e
le n g th o f programs was e i t h e r a sem e ster ( u s u a l l y 15 t o 16 weeks) o r
q u a r t e r ( u s u a l l y 10 to 12 weeks) tim e p e rio d (Table 5 ) .

The n e x t most

f r e q u e n t tim e p e rio d was th e f u l l day fo rm at r e p o r te d by 18.6% o f th e
r e s p o n d e n ts .32 •

33
TABLE 5
PROGRAM FORMAT AS TO TIME LENGTH

Time Length

Number

P ercen t

O n e-h alf Day

10

7.0

One F ull Day

27

18.6

Two F ull Days

9

6.2

Three F ull Days

5

3.4

Semester

39

26.9

Q u arter

16

11.0

O th e r, e . g . , 1 week, 2 weeks,
3 e v e n in g s , 1-hour s e s s io n s
f o r 10 weeks, e t c .

39

26.9

145

100.0

T otal

The t r e n d s in e d u c a tio n a l programs f o r small b u s in e s s e s r e f l e c t
th e r e a d in e s s o f many c o lle g e s and u n i v e r s i t i e s to reach o u t to a nont r a d i t i o n a l c l i e n t e l e — th e small b u s in e s s p r a c t i t i o n e r .
U n i v e r s i t i e s a r e a l s o more in v o lv ed in te a c h in g co u rses about
small b u s in e s s th an e v e r b e f o r e .

Louise and Vince L uchsinger r e p o r t

th a t:
More c l a s s e s a r e being o f f e r e d by a l a r g e r number o f
i n s t i t u t i o n s , and in c r e a s i n g numbers o f s tu d e n ts a r e
ta k in g t h e c o u r s e s . While a decade ago many s tu d e n ts
r e f l e c t e d a d i s t a s t e f o r th e r i s k - t a k i n g a s p e c ts o f a
small b u s in e s s , t h e r e i s a r e v i v a l o f s tu d e n t i n t e r e s t
in small b u s i n e s s e s . 33
A p i l o t study was conducted by W illiam Brannen o f C reigh ton
U n iv e r s ity t o d eterm ine th e d e s i r a b i l i t y o f adding a s e p a r a t e course in

34

small b u s in e s s m arketing t o th e t r a d i t i o n a l b u s in e s s m arketing cu rricu lu m .
His survey sample in clu d ed 436 s tu d e n ts (256 o f whom were m arketing
m ajors) a t 14 b u s in e s s c o l l e g e s .

In resp on se t o th e s ta te m e n t t h a t

"a co urse in small b u s in e s s m arketing should be o f f e r e d a t t h i s s c h o o l,"
85% a g re e d , 3% d is a g re e d and 12% had no o p in io n .

In respo nse t o th e

s ta te m e n t, "I would ta k e a small b u s in e s s m arketing co u rse i f i t were
o f f e r e d , " 75% a g re e d , 14% d is a g re e d and 11% had no o p in io n .

Brannen

concluded t h a t , " I f r e s u l t s o f a major stu d y were as f a v o ra b le as th o se
o f th e p i l o t s tu d y , m arketing e d u c a to rs sh ould be p o s i t i v e l y in flu e n c e d
toward adding such a co u rse t o th e c u r r ic u l u m ."34
In a tte m p tin g to determ ine how much i n t e r e s t u n i v e r s i t y b u sin e ss
s tu d e n ts have in small b u s in e s s ownership as w ell as in ta k in g r e l a t e d
coursework, Gerald H i l l s conducted a survey 1n th e b u s in e s s school
a t th e U n iv e r s ity o f T ennessee.

Of th e 659 s tu d e n t r e s p o n d e n ts , 59%

in d i c a t e d t h a t i t was "somewhat" o r "very l i k e l y " t h a t th e y would someday
own a n d /o r o p e r a te a b u s in e s s o f t h e i r own.

N early h a l f o f th e s tu d e n ts

ex p ressed c o n s id e ra b le " u n c e r ta in ty " about th e valu e o f t h e i r b u sin e ss
coursework in c o n t r ib u t i n g t o t h e i r p r e p a r a t io n o f owning a b u s in e s s .
In r e p ly to a q u e s tio n r e g a rd in g th e v alu e o f a p p l i c a t i o n - t y p e b u s i ­
ness co urses (d e fin e d as working w ith a c tu a l b u s in e s s problems), about
92% responded by marking th e " v alu ab le" end o f th e s c a l e .

Asked whether

th e y would be i n t e r e s t e d in ta k in g a c o u rse in small b u s in e s s management,
87% s a id " y e s ."

In co n c lu d in g , H i l l s s t a t e d :

Perhaps th e g r e a t e s t message in th e s e s t a t i s t i c s i s
n o t th e few s t a t i s t i c a l d i f f e r e n c e s , b u t r a t h e r th e
com m onalities and th e high d eg ree o f i n t e r e s t by groups
who a r e t e c h n i c a l l y c o n s id e re d l e s s I n t e r e s t e d . . . .
The f u t u r e i s b r i g h t f o r sm all b u s in e s s e n t r e e s and
f o r small b u s in e s s e d u c a t i o n . 35

35
C o n su ltin g A s s is ta n c e :

The Small Business I n s t i t u t e Program

The Small Business I n s t i t u t e Program, implemented in 1972, was
d esign ed t o in v o lv e b u s in e s s s tu d e n ts and f a c u l t y re s o u rc e s in a
c o u n se lin g e f f o r t w ith small b u s in e s s owners a c ro ss th e c o u n try .

The

Small Business A d m in istra tio n su p p o rts th e program f i n a n c i a l l y by p ro ­
v id in g a f e e to c o lle g e s and u n i v e r s i t i e s on a s e m e ste r-b y -se m e s te r
b a sis.

The f a c u l t i e s o f p a r t i c i p a t i n g i n s t i t u t i o n s , in t u r n , s u p e rv is e

upper d i v i s i o n and g ra d u a te s tu d e n ts in c o u n se lin g teams t o p rov id e
d i r e c t i o n f o r th e program.

L a st b u t n o t l e a s t , small b u s in e s s owners

v o lu n te e r f o r co u n selin g and p ro vid e th e b a s is f o r th e s e m e s t e r 's
a c t i v i t y - t h e i r m ark etin g , management, a c c o u n tin g , f i n a n c i a l , and
o th e r b u s in e s s problems.
Schools o f b u s in e s s a r e g e n e r a l l y recommended f o r p a r t i c i p a t i o n
in th e SBI program by th e D i s t r i c t a n d /o r Regional D ir e c to rs o f SBA
O ffices.

I n t e r e s t in h elp in g small b u s in e s s owners i s a prime r e q u i s i t e

f o r recommendation.

In a d d i t i o n , i t i s u s u a lly p r e f e r a b l e t h a t th e

program i s a d m in iste re d through a s p e c i f i c c o u rse (such as a p o lic y
c o u r s e , small b u s in e s s management c o u r s e , e t c . ) and t h a t f a c u l t y and
s tu d e n ts be committed to th e Idea o f working w ith small b u sin e ss owners.
Before th e beginning o f th e s e m e s te r , a s p e c i f i e d number o f
c ases t o be a s sig n e d t o a p a r t i c u l a r school o f b u s in e s s i s s e l e c t e d ,
and in fo rm atio n on th e firm s concerned i s forwarded t o th e f a c u l t y c o o r d in a to r by th e D i s t r i c t SBA O f f ic e .

The number o f cases to be

a s sig n e d 1s u s u a lly determ ined by th e s i z e o f th e c l a s s in v o lv e d , th e
d e n s it y o f small b u s in e s s in th e m etro po litan-eco no m ic a r e a , and o th e r
fa c to rs.

The p a r t i c i p a t i n g school o f b u s in e s s i s su pp orted f i n a n c i a l l y

36

on a c a s e -b y -c a s e b a s is d u rin g th e s e m e s te r , w ith th e number o f cases
a ssig n e d o f te n v arying from one sem e ster t o a n o th e r.
The c l a s s through which SBA a c t i v i t y i s implemented i s u s u a lly
segmented i n t o r e l e v a n t teams o f s t u d e n t s , w ith an a tte m p t by th e f a c u l t y
to p ro vide each team w ith persons o f d iv e r s e backgrounds and m ajors.
Thus i t i s p o s s i b l e to have re p re s e n te d on a p a r t i c u l a r team i n d i v i ­
d u als w ith s p e c i a l i z e d knowledge o f a c c o u n tin g , m ark etin g , f in a n c e ,
and management.

Each team works w ith one case d uring th e s e m e ste r,

a n a ly z in g problem s, making perso nal c a l l s to th e p lace o f b u s in e s s ,
and fo rm u la tin g recommendations f o r improved management.
Small b u s in e s s c l i e n t s may be i n v i t e d i n t o th e classroom f o r
d is u c s s io n s d u rin g th e sem e ster.

All company in fo rm atio n made a v a i l a b l e

to th e s tu d e n ts 1s c o n sid e red c o n f i d e n t i a l and s tu d e n ts a r e expected
t o use i t f o r c l a s s purposes o n ly .
Because o f th e i n t e r d i s c i p l i n a r y n a tu re o f th e problem s, some
co u rses a r e t a u g h t by a team o f p r o f e s s o r s .

In o th e r c a s e s , th e f a c u l t y

c o o r d in a to r le a n s on h is o r h e r own i n t e r d i s c i p l i n a r y background w hile
i n v i t i n g in f a c u l t y c o n s u lt a n t s from o th e r d i s c i p l i n e s as needs d i c t a t e .
The growth o f th e program i s dem onstrated by th e f a c t t h a t th e
t o t a l number o f s tu d e n ts involved in c r e a s e d from 1,000 in 1973 to 20,000
1n 1976 w h ile th e number o f f a c u l t y c o o r d in a to rs ro se from 72 t o 2,000
1n th e same p e r i o d . 36

The number o f c o lle g e s and u n i v e r s i t i e s , l i s t e d

as 36 in 1973, in c r e a s e d to 385 in 1976, as shown 1n F igu re 1 . ^
d i s p e r s io n o f th e s e a c ro s s th e co u n try 1s shown in F igure 2.^®

The
Every

s t a t e i s r e p re s e n te d by a t l e a s t one p a r t i c i p a t i n g s c h o o l, w ith Texas
showing th e l a r g e s t number - t h i r t y - s i x .

SCHOOLS

FACULTY

400

STUDENTS

2.00C------

20,000

20,000

385
338

17,000
1 ,5 0 (•

t/>
CL

H
OC
c
o.
u.
o

1,040

1.00C-

20C ■

10.00C-

183

8,400

OC
LU
CO

s;
ZD

10C

50C

5,00C

72
1973

1973
FIGURE 1

1,000
74

75

76

THE GROWTH OF THE SBI

1973

74

75

76

FIGURE 2 - SBI COLLEGES AND UNIVERSITIES

39
Approximately 400 c o lle g e s and u n i v e r s i t i e s a r e p a r t i c i p a t i n g
in t h e SBI program a t t h e p r e s e n t tim e.
In 1978, th e Small Business A d m in istra tio n conducted a survey
stu d y t o o b ta in an e v a lu a tio n o f th e SBI program as p e rc e iv e d by deans
o f b u s in e s s c o l l e g e s .

The fo llo w in g p o in ts summarize some o f th e m ajor

f in d in g s from th e s tu d y :
1.

O verall e f f e c t i v e n e s s o f th e SBI program was r a t e d as
" e x c e l l e n t " o r "very good" by o v er 83 p e r c e n t o f th e
re sp o n d e n ts . Only te n resp o n d en ts (15.1 p e rc e n t) r a t e d
th e SBI program as average o r f a i r .

2.

To th e q u e s tio n ask in g i f the SBI was worth th e time
and e f f o r t , 93.9 p e r c e n t o f th e deans responded " y e s ."
Only f o u r deans (6.1 p e r c e n t) b e lie v e d th e program
was n o t worth th e tim e , e f f o r t , and c o s t .

3.

A n aly sis o f th e resp o n ses t o th e q u e s tio n ask in g i f th e
U n iv e r s ity would c o n tin u e th e SBI program i f SBA funding
was d i s c o n tin u e d , was i n t e r e s t i n g and r e v e a l i n g . S ix ­
te e n deans i n d i c a t e d t h a t th e SBI program would "probably
n ot" o r " d e f i n i t e l y n o t" be co n tin u ed i f funding was d i s ­
c o n tin u e d . However, 27 (40.9%) i n d i c a t e d t h a t th e program
would be co n tin u ed even i f fund in g were suspended. A
r a t h e r s i z a b l e group — 34.9% — responded t h a t th ey were
"n o t su re" i f th e SBI would c o n tin u e i f funding was s u s ­
pended.

4.

In resp o n se to th e q u e s tio n "Should SBI be co n tinu ed?"
over 92% o f th e deans responded t h a t i t should be; only
f i v e (7.6%) answered "no" o r " n o t s u r e . "

5.

Three q u e s tio n s were concerned w ith e x i s t e n c e and s t a t u s
o f th e SBI d i r e c t o r . N inety-one p e r c e n t o f th e deans
surveyed i n d i c a t e d having an SBI p r o j e c t d i r e c t o r . In
th e m a jo rity o f c o l l e g e s , th e SBI d i r e c t o r d id n o t r e c e iv e
a d d i t i o n a l pay o r a reduced te a c h in g lo a d . E ig h t deans
(2.1 p e r c e n t) i n d i c a t e d t h a t th e SBI d i r e c t o r re c e iv e d
a d d i ti o n a l pay. In 17 sch o o ls (25.8% ), th e SBI p r o j e c t
d i r e c t o r re c e iv e d a one co u rse r e d u c tio n in te a c h in g
lo a d .

6.

Two q u e s tio n s d e a l t w ith th e p la c e o f th e SBI in th e
cu rric u lu m and t h e amount o f academic c r e d i t r e c e iv e d
by p a r t i c i p a t i n g s t u d e n t s . N early 85 p e r c e n t o f th e
respo nses in d ic a te d academic c r e d i t o f a t l e a s t th r e e

40

hours o r more. A co u rse in small b u s in e s s manage­
ment In c lu d in g p a r t i c i p a t i o n as an SBI s tu d e n t con­
s u l t a n t was r e q u ir e d in f i v e sch o o ls (7 .6 p e r c e n t ) .
I t was n o t r e q u ir e d in e i t h e r g rad u ate o r under­
g ra d u a te programs i n 9 2 .4 p e r c e n t o f th e c o lle g e s
r e p re s e n te d 1n t h i s s tu d y .
7.

The deans b e lie v e d th e most s i g n i f i c a n t b e n e f i t s o f
th e SBI program ( in o r d e r o f freq u en cy o f resp o n se)
were: "p ro v id in g p r a c t i c a l dimension t o c u rric u lu m " ;
" p ro v id in g o p p o r tu n ity f o r s e r v i c e t o th e community";
and "p ro v id es o p p o r tu n ity f o r f a c u l t y t o gain g r e a t e r
knowledge o f problems o f small b u s in e s s and le a d s t o
improved t e a c h in g ."

8.

The most s i g n i f i c a n t d isa d v a n ta g e s o f th e SBI, as
viewed by d e a n s , ( i n o r d e r o f freq u en cy o f response)
were: "in a d e q u a te f i n a n c i a l s u p p o rt by th e SBA";
" la c k o f i n t e r e s t o f f a c u l t y " ; and " c o s t o f th e p ro ­
gram to th e c o l l e g e / u n i v e r s i t y . " 39
The SBI In n ov atio n Program, i n i t i a t e d in 1979, i s a r e c e n t v a r i a ­

t i o n o f th e o r ig i n a l SBI Program.

This program i s a j o i n t v e n tu re between

th e Small Business A d m in is tra tio n and th e NSF-Funded In n ov atio n C enter
a t th e U n iv e r s ity o f Oregon.

I t s purpose i s t o s ti m u l a t e i n d u s t r i a l

in n o v a tio n by p ro v id in g lo w -c o st a s s i s t a n c e t o independent and small
b u s in e s s in v e n to rs and to expose SBI s tu d e n t s t o t h e in n o v a tio n p ro c e ss .
The In n o v atio n C en ter a t th e U n iv e r s ity o f Oregon has been ex­
p erim e n tin g w ith v a rio u s in c e n ti v e s t o s t i m u l a t e n o n -c o rp o ra te in n o v a tio n .
Serving independent and small b u s in e s s in n o v a to rs n a tio n w id e , th e C en ter
i s c u r r e n t l y e v a lu a tin g ab ou t two-hundred i d e a s , in v e n tio n s and new
p ro d u cts each month.
Linking th e SBI program and th e In n o v atio n C e n t e r 's e v a lu a tio n
s e r v i c e makes i n v e n to r a s s i s t a n c e a v a i l a b l e on a more l o c a l i z e d b a s is
th ro u g h o u t th e c o u n try .

41

The channels f o r accom plishing t h i s lin k a g e have been
s ta n d a rd iz e d and accoimodated t o normal SBI p ro c e d u re s.
The Oregon Inn ovation C en ter w i l l (1) f u r n i s h c o o p e ra tin g
SBI sch o o ls w ith th e a p p r o p r i a t e background in fo rm a tio n on
i t s e v a lu a tio n system ; and (2) a c t as a r e f e r r a l c e n t e r f o r
in v e n tio n s and new p ro d u ct id e a s which a p p ear t o have s u f ­
f i c i e n t p o t e n t i a l to w a r ra n t f u r t h e r a s s i s t a n c e . Inven­
t i o n s and new p ro d u cts s e le c t e d f o r SBI a s s i s t a n c e w i l l be
r e f e r r e d to t h e SBA ARDMA ( A s s i s t a n t Regional D i r e c t o r Management A s s is ta n c e ) i n th e re g io n in which the i n v e n to r
r e s i d e s f o r assignm ent t o an a p p r o p r i a t e SBI school under
normal SBI p ro ced u res.
Although t h i s program w i l l n o t d i f f e r p r o c e d u ra lly from
th e e x i s t i n g SBI program, i t w i l l open a new dimension f o r
both s tu d e n ts and i n v e n t o r s . S tu d e n ts w i l l have th e oppor­
t u n i t y to view th e in n o v a tio n p ro cess from i t s e a r l y s t a g e s .
I n v e n to r s , norm ally fo rc e d t o go i t a lo n e , w i l l have a ccess
to badly needed a s s i s t a n c e in t h e i r e f f o r t s to b rid g e th e
gap between in v e n tio n and i n n o v a t i o n . 40
Comprehensive A s s is ta n c e :

SBDC P i l o t Programs

The concept o f a Small Business Development C en ter was f i r s t
a r t i c u l a t e d p u b l i c l y by Louis Laun, A cting Small Business A d m in is tr a to r ,
in 1975.

Speaking a t a n a tio n a l workshop m eeting o f SBI P r o j e c t D irec­

t o r s , he s a id :
The scope would be b ro a d e r than th e SBI program. I t would
reach i n t o a l l academic d i s c i p l i n e s w ith s p e c i f i c e x p e r t ­
i s e b e n e f i c i a l t o small b u s in e s s , such as e n g in e e r in g , law ,
jo u rn a lis m and communication, e d u c a tio n , th e s c ie n c e s and
even m edicine. There could a l s o be i n t e r f a c e w ith o th e r
government ag en cies where a p p l i c a b l e .
Some o f th e p o s s ib le f u n c tio n s o f th e s e c e n t e r s would be:
(1) to conduct f e a s i b i l i t y s t u d i e s f o r s t a r t i n g o r expand­
ing a b u s in e s s , th e re s o u rc e s r e q u i r e d , p ro d u c t e v a lu a ­
t i o n s , and development; (2) t o determ in e b u s in e s s a p p t i t u d e s , g en eral knowledge, o r knowledge p e c u l i a r t o a
s p e c i f i c b u s in e s s , by th e development o f e n tr e p r e n e u r
e v a lu a tio n methods; and (3) t o p u b l i c i z e programs and
o b je c tio n s in o r d e r t o a t t r a c t v e n tu re c a p i t a l o r an SBA
loan to th e c e n t e r s . 41
Beginning in 1976 th e Small Business A d m in is tra tio n provided
funding f o r th e i n i t i a t i o n o f e i g h t p i l o t SBDC programs a t e i g h t

42

u n iv e rsitie s:

C a l i f o r n i a S t a t e U n iv e r s ity a t Chico, C a l i f o r n i a S t a t e

P o ly te c h n ic U n iv e r s ity a t Pomona, The U n iv e r s ity o f West F l o r i d a , The
U n iv e r s ity o f G eo rg ia, U n iv e r s ity o f Maine a t Portland-Gorham , Univer
s i t y o f M issouri a t S t. L o u is, The U n iv e r s ity o f Nebraska a t Omaha,
and R utgers U n iv e r s ity .

Even though n a tio n a l l e g i s l a t i o n and guid e­

l i n e s f o r e s t a b l i s h i n g th e SBDC program had n o t been com pletely
developed, th e b a s ic o u t l i n e o f th e co ncept as ex p ressed by th e e i g h t
p i l o t programs could be summarized as f o llo w s :
(1)

A Small Business Development C en ter i s an o r g a n iz a ­
t i o n t h a t has been c r e a te d t o a s s i s t in s t a b l i z i n g
th e economy, d eveloping jo b s in th e p r i v a t e s e c t o r ,
f o s t e r i n g th e s u rv iv a l o f th e f r e e e n t e r p r i s e system ,
c r e a t i n g new b u s in e s s e s and improving th e n e t worth
o f e x i s t i n g b u s in e s s e s .

(2)

A Small Business Development C en ter i s an omnibus
s e r v i c e o r g a n iz a tio n e s t a b l i s h e d t o a s s i s t small
b u s in e s s owners and managers w ith t h e i r management
problems and o p p o r t u n i t i e s .

(3)

A Small Business Development C en ter i s an advocacy
o r g a n iz a tio n f o r f r e e e n t e r p r i s e and independent
b u s in e s s .

(4)

A Small Business Development C en ter i s a p a r t n e r ­
s h ip between b u s in e s s , h ig h e r e d u c a tio n and
government.

(5)

A Small Business Development C en ter i s a co o rd in ­
a t i n g agency f o r small b u s in e s s a s s i s t a n c e a c t i v i ­
t i e s f o r a s t a t e o r a d i s t r i c t w ith in a s t a t e .
S t a t e p lann ing i s an e s s e n t i a l elem ent f o r e f f e c ­
t i v e programming.

(6)

A Small B usiness Development C en ter i s an o rg a n iz a ­
t i o n t h a t a tte m p ts t o u t i l i z e both e x i s t i n g and
n ew ly -crea te d re so u rc e s f o r th e enhancement o f th e
small b u s in e s s community.

(7)

A Small B usiness Development C en ter i s an agency'
t h a t draws f i n a n c i a l su p p o rt from th e f e d e r a l
government, s t a t e government, lo c a l government,
h ig h e r e d u c a tio n , and p r i v a t e e n t e r p r i s e .

43

(8)

A Small Business Development C en ter i s an o r g a n i­
z a tio n t h a t uses th e e x p e r t i s e o f in d iv i d u a l s from
th e p r i v a t e s e c t o r , h ig h e r e d u c a tio n , and govern­
ment t o c a r r y o u t i t s m issio n.

(9)

A Small Business Development C en ter i s an o r g a n iz a ­
t i o n t h a t i s I n t e g r a t e d w ith a b u sin e ss s c h o o l,
b u sin e ss departm ent o r b u sin e ss d i v i s i o n . I t i s
n o t a s e p a r a t e , autonomous o p e r a tin g u n i t o f h ig h e r
e d u c a tio n . The C en ter i s i n t e g r a t e d w ith th e
d i s c i p l i n e s r e l a t e d to b u s i n e s s . 42
E s s e n t i a l l y th e SBDCs have e d u c a tio n a l m issio n s w ith c lo s e ly

r e l a t e d economic o b j e c t i v e s .

T h e ir b a s ic m issio ns a re to a s s i s t th e

managers o f small b u s in e s s in improving t h e i r m anagerial s k i l l s .

SBDC

programs a r e b u i l t upon th e assumption t h a t more e f f i c i e n t management
performance lead s to economic growth and t o g r e a t e r s t a b i l i t y o f employ
ment and t h a t b e t t e r management o f e x i s t i n g re s o u rc e s i s th e b e s t long
range approach t o economic developm ent.4^
In a d d itio n t o p ro v id in g t r a i n i n g programs and c o u n s e llin g to
th e managers o f e x i s t i n g f ir m s , SBDCs p ro vide a sounding board f o r
c l i e n t s who wish to s t a r t new b u s in e s s e s .

Many people e n t e r a b u sin e ss

who do n o t have th e n e c e s sa ry s k i l l s , o r th e b u s in e s s i t s e l f i s n o t
econom ically f e a s i b l e .

Because o f t h i s , b u s in e s s m o r t a l i t y r a t e s a re

h ig h , and th e r e s u l t i n g c o s ts o f s o c ie ty a r e s ta g g e r in g .

Thus, an

im p o rta n t f u n c tio n o f th e c o u n s e llin g provided through SBDCs i s to
i d e n t i f y th e s e r i s k s f o r th o s e seek ing c o u n s e l, and to guide an d, in
some i n s t a n c e s , even d isco u rag e th o se who do n o t appear t o have th e
n e c e ssa ry q u a l i f i c a t i o n o r who la c k a p r a c t i c a l view o f t h e i r proposed
v e n t u r e . 44

44

The U n iv e r s ity o f Georgia SBDC
In o rd e r t o p rov id e a b e t t e r un d erstan d in g o f th e Small B usi­
ness Development C en ter c o n c e p t, i t w i l l be u s e fu l t o examine one o f
th e e i g h t p i l o t programs in d ep th .

The o r i g i n a l SBDC was e s ta b li s h e d

a t th e U n iv e r s ity o f Georgia in c o n ju n c tio n w ith th e U.S. Small Business
A d m in is tra tio n .

This c e n t e r began o p e r a tio n s on A pril 30, 1977.^5

The C en tral O rg an izatio n
The Small Business Development C e n te r, th e U n iv e r s ity o f
G eo rgia, i s a h ig h ly f l e x i b l e o r g a n iz a tio n designed t o se rv e th e needs
o f the small b u sin e ss community throu gh ou t G eorgia.

The o rg a n iz a tio n

p lan (see F ig ure 3) re c o g n iz e s th e need f o r a s ta te w id e c o o r d in a tin g
u n i t w ith d i s t r i c t c e n te r s lo c a te d throu gh ou t th e s t a t e .

The sta te w id e

c o o r d in a tin g u n i t and one o f th e d i s t r i c t c e n te r s a re lo c a te d as th e
U n iv e r s ity o f G eorgia.

The s t a t e c o o r d in a tin g u n i t c o n s is t s o f th r e e

b a s ic d i v i s i o n s w ith s p e c ia l u n i t s added as need d i c t a t e s .

The th r e e

b a s ic d i v i s i o n s a r e th e D iv isio n o f C ontinuing E d u catio n , th e D iv isio n
o f Business Info rm ation S e r v ic e s , and th e D iv isio n o f R e s id e n tia l
In stru c tio n .

As c o o r d in a tin g u n i t s f o r th e s t a t e , th ey p ro v id e s t a f f

work and l e a d e r s h ip f o r program development in t h e i r r e s p e c t i v e a r e a s .
The d i s t r i c t c e n t e r u n i t s p ro v id e s e r v i c e s t o small b u s in e s s e s in th e
d istric t.

The t h r e e f u n c tio n s — co n tin u in g e d u c a tio n , b u s in e s s inform a­

t i o n , and r e s i d e n t i a l i n s t r u c t i o n —a r e found in each o f th e d i s t r i c t
cen ters.
The S e rv ic e D eliv ery Network
Twelve d i s t r i c t c e n t e r s have been e s t a b l i s h e d a t key lo c a ti o n s
thro u g h o u t G eorgia.

These c e n te r s w i l l be o p e ra te d by s i s t e r

DEAN
COLLEGE OF
BUSINESS
ADMINISTRATION

DIRECTOR
STATE SBDC
STATE
ADVISORY
COUNCIL

OPERATIONS
COMMITTEE
(Directors of
12 D istrict
SBDC's)

SCORE
AND ACE

DIRECTOR.
CONTINUING
EDUCATION

DIRECTOR.
BUSINESS
INFORMATION
SERVICES

DIRECTOR,
LEISURE TIME
STUDIES

DIRECTOR,
RESIDENTIAL
INSTRUCTION

DIRECTOR FOR
INTERNATIONAL
TRADE

DIRECTOR,
MINORITY BUSINESS
ENTERPRISE

DISTRICT SBDC'S

DIRECTOR
FUNCTIONS'
CONTINUING
EDUCATION

BUSINESS
INFORMATION
SYSTEMS

RESIDENTIAL
INSTRUCTION

DISTRICT
ADVISORY COUNCIL
SPECIAL
PROJECTS

FIGURE 3 - UNIVERSITY OF GEORGIA SBDC ORGANIZATION CHART

46
I n s t i t u t i o n s w ith in th e U n iv e r s ity System o f G eorgia.
two d i s t r i c t c e n te r s a re f u l l y o p e r a t i o n a l i z e d .
as f in a n c e s p e rm it.

C u r r e n t ly , only

O thers w i l l be opened

Each d i s t r i c t c e n t e r w i l l p ro v id e b a s ic co u n selin g

and b a s ic co n tin u in g e d u c a tio n s e r v ic e s to th e b u s in e s s c o n s t i t u e n t s
o f th e r e s p e c t i v e d i s t r i c t s .
Each d i s t r i c t c e n t e r w ill be o p e r a t i o n a l iz e d by c o n t r a c t u a l
agreement w ith th e S t a t e Small Business Development C enter a t th e
U n iv e r s ity o f Georgia in A thens, G eorgia.

In a d d i t i o n to p ro v id in g

o th e r i n s t i t u t i o n s o f h ig h e r e d u c a tio n funds t o s u p p o rt d i s t r i c t b u s i ­
ness development c e n t e r o p e r a t i o n s , th e S t a t e SBDC p ro v id e s p r o f e s s io n a l
e x p e r t i s e in th e v a rio u s d i s t r i c t s when th e d i s t r i c t c e n t e r s a r e unable
t o handle r e q u e s ts due t o excess workloads o r th e lack o f r e q u i s i t e
e x p e rtise .
A lso , th e S t a t e C en ter s e rv e s as th e c o o r d in a tin g agency and
f u n d - r a i s i n g agency f o r each o f th e d i s t r i c t o p e r a t i o n s .

F i n a l l y , the

S t a t e C en ter engages in p r o f e s s io n a l a c t i v i t i e s t h a t a r e more e f f i c i e n t l y
undertaken a t th e s t a t e l e v e l .
Each p a r t i c i p a t i n g i n s t i t u t i o n o f h ig h e r e d u c a tio n develops an
annual s ta te m e n t o f work t h a t r e p r e s e n t s what th e i n s t i t u t i o n ag rees to
accom plish in a given y e a r .

S i g n i f i c a n t l a t i t u d e i s given t o a con­

t r a c t i n g i n s t i t u t i o n to develop a program t h a t meets th e needs o f small
b u s in e s s e s in i t s d i s t r i c t .

The s ta te m e n t o f work fo rm u la te s th e b a s is

o f th e c o n tr a c tu a l agreement.
The C ontinuing Education D iv isio n
A prim ary f u n c tio n o f th e Small Business Development C en ter i s
t o p ro vide l i f e l o n g l e a r n in g o p p o r t u n i t i e s f o r p o t e n t i a l and e x i s t i n g

47

managers o f small b u s in e s s e s in G eorgia.

During th e f i r s t y e a r o f

o p e r a t io n , th e SBDC sponsored 182 s h o r t c o u r s e s , sem inars and work­
shops.

These c o n tin u in g e d u c a tio n programs were made as a c c e s s i b l e

to th e small b u sin e ss c l i e n t e l e as p o s s i b l e .

The c o u rse s were

o f f e r e d on a s ta te w id e b a s is a t tim es co n v en ien t t o thousands o f small
b u s in e s s p e rs o n s .

Approximately 7700 i n d i v i d u a l s p a r t i c i p a t e d 1n th e

SBDC sponsored programs.
The S t a t e SBDC D i r e c t o r a d m in is te rs th e c o n tin u in g e d u c a tio n
program through f i e l d r e p r e s e n t a t i v e s who t r a v e l th ro u g h o u t th e
d i s t r i c t s on a planned b a s i s t o a c q u a in t b u s in e s s e s w ith t h e s e r v i c e s
o f th e SBDC, to d is c u s s t h e i r problems and d eterm ine w hether th e SBDC
can be o f a s s i s t a n c e .

The needs i d e n t i f i e d a r e r e f e r r e d t o th e con­

t i n u i n g e d u c a tio n d i v i s i o n , th e b u s in e s s in fo rm a tio n d i v i s i o n , o r one
o f th e s p e c i a l u n i t s f o r a c t i o n .
The c o n tin u in g e d u c a tio n d e l i v e r y system in c lu d e s group i n s t r u c ­
t i o n , independent stu d y program s, and e d u c a tio n a l t e l e v i s i o n .

As con­

ti n u i n g e d u c a tio n needs d ev elo p , a d i r e c t o r and i n s t r u c t o r s a r e a s sig n e d
t o each program.

The program d i r e c t o r s and i n s t r u c t o r s a r e f a c u l t y

members, members o f th e S e rv ic e Corps o f R e tir e d E x e c u tiv e s , f u l l - t i m e
s t a f f members o f th e SBDC, o r g ra d u a te s tu d e n ts working on a p a r t - t i m e
b a sis.
Business In form atio n D iv isio n
The purposes o f th e D iv isio n o f Business In fo rm atio n S e r v ic e s
are th re e -fo ld :

(1) t o promote th e development o f a p p lie d r e s e a r c h

which w i l l advance th e body o f knowledge su rro u n d in g small b u s in e s s

48

management; (2) to prov ide one-on-one b u s in e s s co u n s e lin g s e r v i c e s
on a s ta te w id e b a s i s ; and (3) to p ro v id e b u s in e s s d a ta t h a t i s suppor­
t i v e o f th e b a s ic co u n selin g s e r v i c e s prov id ed through th e re g io n a l
c e n t e r s , e . g . , s h o r t and lo n g -ran g e economic f o r e c a s t i n g d a ta t a i l o r e d
t o meet th e plan nin g needs o f small b u s in e s s e s in t h e r e s p e c t i v e
reg i o n s .
The c o u n selin g program was e s t a b l i s h e d to handle r e q u e s ts f o r
s e r v i c e s from in d iv id u a l b u s in e s s p e rs o n s .

I t complements th e C e n te r ’s

c o n tin u in g ed u catio n programs which i n s t r u c t persons in gen eral b u sin ess
p r i n c i p l e s by p ro v id in g o n - s i t e , one-on-one c o u n s e lin g to b u s in e s s e s in
need o f a s s i s t a n c e .

Counseling ranges from ad v ic e in one o r two s p e c i f i c

a re a s t o long term e v a lu a tio n o f a l l a r e a s o f a p e r s o n 's b u s in e s s .
Counseling a c t i v i t i e s have been a c e n tr a l f u n c tio n o f th e SBDC
s in c e May o f 1977 when th e i n i t i a l s t a f f c o n s is te d o f i t s D i r e c t o r ,
A s s i s t a n t D i r e c t o r , and two s t a f f c o n s u l t a n t s .

Since t h e n , th e s t a f f

has grown to ele v e n h a l f - t i m e p e r s o n s , t h r e e from th e a r e a o f a c c o u n tin g ,
two from m arketing and f i n a n c e , and one each in th e f i e l d s o f management
s c ie n c e , management,law and p u b lic r e l a t i o n s .

This s t a f f i s su p po rted by

p r o f e s s o r s in th e C o lleg e o f B u s in e ss , w ork-study s tu d e n t s m ajoring in
b u s in e s s , r e t i r e d v o l u n t e e r s , and r e p r e s e n t a t i v e s o f th e Small Business
A d m in is tra tio n .
I t i s in ten d ed t h a t th e C o o p erativ e Extension S e rv ic e s t a f f o f
th e U n iv e r s ity o f Georgia w i l l become an i n t e g r a l component o f th e
s ta te w id e s e r v i c e d e l i v e r y network in th e n e a r f u t u r e .

49
R e s id e n tia l I n s t r u c t i o n D iv isio n
The purpose o f th e R e s id e n tia l I n s t r u c t i o n D iv isio n i s to
ed u cate f u tu r e owners and managers o f small b u s in e s s e s .
During th e summer o f 1977 th e Curriculum Committee o f th e
C ollege o f Business A d m in istra tio n approved th e ad o p tio n o f s e v e ra l
a d d i ti o n a l c r e d i t co urses in th e are a o f small b u s in e s s management.
The newly adopted cou rses were in tro d u c e d in th e f a l l o f 1978.
Also in 1 9 7 8 ,a s ta te w id e s tu d e n t i n t e r n program and s tu d e n t
c o o p e r a tiv e program were i n i t i a t e d f o r degree seek in g s tu d e n ts in
c o n s tr u c t io n w ith p a r t i c i p a t i n g small b u s in e s s e s .
S p e c ia liz e d S e rv ic e s
There a r e t h r e e s p e c i a l i z e d s e r v i c e o r ie n te d programs t h a t a re
c o o rd in a te d w ith th e SBDC:

th e S t a t e o f G e o r g ia 's O ffic e o f M in ority

Business E n t e r p r i s e , t h e Small Business I n t e r n a t i o n a l Trade C e n te r, and
th e C en ter f o r L e isu re Time S tu d ie s .
The M ino rity Business E n t e r p r i s e Program p ro v id e s management,
t e c h n ic a l and e d u c a tio n a s s i s t a n c e f o r m in o rity and econom ically d i s ­
advantaged b u s in e s s e s w ith in th e s t a t e by s e rv in g as a fo c a l p o in t
f o r e d u c a tio n a l and c o n s u l t a t i v e a s s i s t a n c e .
The I n t e r n a t i o n a l Trade and Development C en ter f o r Small Busi­
ness engages p r im a r ily in th o se a c t i v i t i e s a s s o c i a t e d w ith th e i d e n t i ­
f i c a t i o n o f f o re ig n markets and encouragement o f firm s t o s e l l in ov er­
seas m ark ets.

Both c o n tin u in g e d u c a tio n programs and c o u n se lin g s e r ­

v ic e s a r e o f f e r e d by t h i s u n i t .
The L e is u re Time S tu d ie s u n i t was c r e a te d t o p rov ide th e SBDC
s e r v i c e s to thousands o f small b u s in e s s e s in Georgia t h a t o p e r a te
l e i s u r e - t i m e and to u rism r e l a t e d b u s in e s s e s .

50
F in a n c ia l Resources
F in a n c ia l s u p p o rt f o r th e programs and o b j e c t s o f th e C enter
comes from fe d e r a l and s t a t e so u rces and from p r i v a t e s o u rc e s .

In itia l

funding f o r th e G eorgia based program c o n s is t e d o f a $40*000 g r a n t
from th e Small Business A d m in istratio n * p lu s $50*000 provided by th e
College o f Business A d m in is tr a tio n .

The 1978 budget f o r th e C en ter

exceeded $800,000 o f which tw o - th ir d s were s t a t e funds and o n e - th ir d
were f e d e r a l fund s.
I t has been e s tim a te d by th e U n iv e r s ity o f G e o rg ia 's Business
College t h a t a f u l l y developed program would c o s t ap p roxim ately two
m illio n d o l l a r s .
E v alu a tio n o f SBDC P i l o t Programs
To a s s e s s th e e f f e c t i v e n e s s o f th e p i l o t SBDC program s, th e
Small Business A d m in istra tio n c o n tr a c te d w ith a p r i v a t e c o n s u ltin g
fir m to conduct an in -d e p th stu d y o f th e programs f o r an e ig h te e n month p e r i o d , A p ril 1977 through September 1978.

The s tu d y concluded

t h a t t h e l i n k i n g t o g e t h e r o f b u s in e s s a s s i s t a n c e re s o u rc e s through an
u n i v e r s i t y i s a v a l i d c o n c e p t, and t h a t th e SBDC program was r e l a t i v e l y
s u c c e s s fu l in d em o n stratin g t h a t i t was cap ab le o f a c h ie v in g s e v e ra l
g o als and o b j e c t i v e s s e t by th e SBA, in c lu d in g th e fo llo w in g :
(1)

The SBDC concept provided a framework f o r l i n k i n g th e
re s o u rc e s o f th e u n i v e r s i t y , f e d e r a l program s, and
th e p r i v a t e s e c t o r t o a s s i s t small b u s in e s s .

(2)

The SBDC co ncept provided a mechanism through which
r e l e v a n t management and t e c h n ic a l a s s i s t a n c e co uld be
provided to p u b lic and p r i v a t e s e c t o r i n s t i t u t i o n s
s e rv in g th e small b u s in e s s community.

51
(3)

The SBDC co ncept dem onstrated t h a t i t had th e capa­
b i l i t y to s e rv e a c le a rin g h o u s e f u n c tio n f o r economic
and b u sin e ss d a t a .

(4)

The SBDC concept provided o p p o r tu n i t i e s f o r both
b a s ic and a p p lie d r e s e a r c h a t th e u n i v e r s i t y l e v e l .

(5)

The SBDC concept prov ided an environm ent in which
i n t e r e s t e d s tu d e n ts could s y s t e m a t i c a l l y a c q u ir e
e x p e rie n c e in small b u s in e s s development and
management.

(6)

The SBDC's S p e c ia liz e d S e rv ic e s concept dem onstrated
t h a t u n iv e r s i t y - b a s e d i n s t i t u t i o n s have th e c a p a b i l i t y
t o re n d e r a s s i s t a n c e in such a r e a s as te c h n o lo g y , i n - .
t e r n a t i o n a l t r a d e , c a p i t a l fo rm atio n and b u s in e s s law. 6
The stud y a l s o c i t e d c e r t a i n d e f i c i e n c i e s , s p e c i f i c a l l y :

(1)

The a b i l i t y o f th e non-academic SBDC program t o become
a more i n t e g r a l p a r t o f th e u n i v e r s i t y s t r u c t u r e ,
e s p e c i a l l y w ith r e s p e c t to f a c u l t y p a r t i c i p a t i o n .

(2)

The a b i l i t y o f th e SBDC program t o in c r e a s e o p p o rtu n i­
t i e s f o r s o c i a l l y and econom ically disad v an tag ed en­
tr e p r e n e u r s through o rganized o u tre ach and b u s in e s s
development programs.

(3)

The a b i l i t y o f th e SBDC concept t o be s u c c e s s f u l l y
expanded through s ta te w id e programs.

(4)

The a b i l i t y o f th e SBDC program t o f a c i l i t a t e th e
"g ra d u atio n " o f small b u s in e s s c l i e n t s t o p r o f e s ­
s io n a l c o u n se lin g firm s .

(5)

The a b i l i t y o f th e SBA and th e SBDCs t o develop e f f e c ­
t i v e q u a n t i t a t i v e and q u a l i t a t i v e re c o rd keeping and
r e p o r t i n g p ro c e d u re s.

(6)

The a b i l i t y o f th e SBDCs t o develop e f f e c t i v e follow -up
and e v a lu a tio n programs f o r th e s e r v i c e s th e y o f f e r . 47
While a v a r i e t y o f proced ural recommendations were made t h a t

would improve th e o v e r a ll management o f th e program, " th e Study Team
found no evidence to s u g g e s t t h a t any o f th e SBA's g o als and o b j e c t i v e s
f o r th e SBDC program should be abandoned as being too am bitious o r
s i g n i f i c a n t l y u n r e la te d t o th e SBDC c o n c e p t . "48

in t h i s r e g a r d , a l l

52
o f th e SBA's s t a t e d g o als and o b j e c t i v e s were found to be r e l e v a n t to
and t h e i r e v o lu tio n c o n s i s t e n t w ith th e development o f th e program
con cept.

53

NOTES— CHAPTER II

lU .S. Congress, House, Committee on Small B u s in e ss , A Report
on th e F utu re o f Small Business in America, 95th C ong., 2nd S e s s . ,
1978.
^ I b i d . , p. 5.
3U.S. Department o f Commerce, Bureau o f Census, 1972 E n t e r p r is e
S t a t i s t i c s P a r t I , General R eport on I n d u s t r i a l O rg an izatio n (U.S.
Government P r in t i n g O f f i c e , 1977), pp. 143-213. *
^Louis C i c c h i n e l l i and Marcia G rad, In no vation C enter and
Technical A s s is ta n c e t o Business Study (Unpublished Report P repared
f o r th e Michigan Department o f Commerce, O ffic e o f M ich ig an 's Changing
Economy P r o j e c t , 1977), p. 11.
5 u . S . C ongress, Small Business A c t, P u b lic Law 699, 85th Cong.,
2nd S e s s . , 1958.

®U.S., Small Business A d m in is tr a tio n , O f fic e o f Advocacy,
The Study o f Small B u sin e ss, P a r t I I - What Is A Small B usiness?
(U.S. Government P r in t i n g O f f i c e , June, 1977), p. 61.
A j.S . C ongress, S e n a te , S e l e c t Committee on Small B u s in e ss ,
Annual R e p o rt, No. 93-357, 1973, pp. 3-5 .
^ C i c c h in e l l i and Grad, op. c i t . , p. 12.
^U.S. C ongress, House, Committee on Small B u s in e ss , H earin g s,
F uture o f Small Business in America - P a r t I I , 95th Cong., 2nd S e s s . ,
p. 32.
1QI b i d . , P a r t I , p. 11.
I T l b i d . , p. 29.
1 2 l b i d . , P a r t I I , p. 4.
T^ I b i d . , p. 4.
H i b i d . , p. 29.

54

15C i c c h i n e ll i and Grad, op. c i t . , p. 12.
16oavid L. B ir c h , The Job C re a tio n P rocess (An Unpublished
Report P repared f o r th e U.S. Department o f Commerce, Economic Develop­
ment A d m in is tr a tio n , O ffic e o f Economic Research (1 9 7 9 ), p. 8.
l^W ilHam
Hoa<l and P* Rosko, Management F a c to rs C o n tr ib u tin g
to th e Success o r F a i l u r e o f New Small M anufacturers ( U n iv e rs ity o f
M ichigan, Small Business A d m in istra tio n R e p o rt, 1964).
l^ K u rt Mayer and Sydney G o ld s te in , The F i r s t Two Years:
Problems o f Small Firm Growth and S u rv iv al (Brown U n i v e r s i t y , Smal1
Business A d m in istra tio n R ep o rt, 1961).
(London:

^ J o h n a th o n B osw ell, The Rise and D ecline o f Small Firms
George A llan and Unwin L t d . , 1972).

^ R u s s e l l Knight and J . C. Lemmon, The Level o f Management
E x p e rtis e in Small T e c h n ic a lly O rien ted B usinesses in Canada (U n iv e rs ity
o f Western O n ta r io , 1977).
21 Isa a c F og el, Importance o f P lanning in Small B u s in e s s . A
Paper D eliv ered a t th e 24th Annual Conference o f th e I n t e r n a t i o n a l
Council f o r Small Business (Quebec C i t y , J u n e , 1979), p. 20-8.
22Yvon G asse, Management Techniques and P r a c t ic e in Small Manu­
f a c t u r i n g F irm s. A Paper D eliv ered a t th e 24th Annual Conference o f th e
I n t e r n a t i o n a l Council f o r Small Business (Quebec C i t y , June, 1979),
p. 16-13.
23 j . A r g e n ti, "The Techniques o f Growing," Management Today.
Vol. 12 (February, 1970), pp. 2-4 .
24Karl H. V esper, E n tre p re n e u rs h ip Education - A B ic e n te n n ia l
Compendiurn (Milwaukee, Wisconsin: S o c ie ty f o r E n tre p re n e u rs h ip
R esearch, 1976).
^ G e o r g e Solomon, Course O ffe rin g s in Small Business Management/
E n tre p re n e u rs h ip ( I n t e r n a t i o n a l Council f o r Small B u s in e ss , U n iv e r s ity o f
W isco nsin-E xtension , Milwaukee, W isconsin, 1977).

26Edison E asto n , " E n tre p re n e u rs h ip : U ndergraduate O ption ,
C o n c e n tr a tio n , Or What?", Jo u rn al o f Small Business Management. Vol. 15,
No. 3 (Ju ly , 1977), p. 42.
27I b i d . , p. 28.
2 8 j0yce H eisick and Jack F e r n e r, Education Programs in Small
Business Management. A Research Study by th e N atio nal Council f o r Small
Business Management Development (Milwaukee, W isconsin, 1976), p. 18.

55

29I b i d . , p. 10.

3Q lbid., p. 11.
31I b i d . , p. 12.
32I b i d . , p. 13.

33l_ou1se Luchslnger and Vince Luchslnger, "New Trends in Educa­
tio n a l Programs O riented Toward Small B usinesses," Journal of Small
Business Management, Vol. 15, No. 1 (Ja n u a ry , 1977), p. 43.
34william Brannen, "Small Business in the Marketing Curriculum,"
A Paper P re se n te d a t t h e 22nd Annual Conference o f th e I n t e r n a t i o n a l
Council f o r Small Business (W ich ita , Kansas, 1977).
356erald H i l l s , "Future Entrepreneurs From th e Business Schools Innovation Is Not Dead," A Paper Presented a t the 22nd Annual Conference
o f the In te rn a tio n a l Council f o r Small Business (W ichita, Kansas, 1977).
36pat L. Burr and George T. Solomon, "The SBI Program: Four
Years Down th e Road," Jo u rn al o f Small Business Management. Vol. 15,
No. 2 (A p ril, 1977), p. 2.

3 7 i b id ., p. 3.
38I b i d . , p. 4.

39Robert E. Holmes, "How 1U' A dm inistrators View the SBI Program,"
Small Business I n s t i t u t e Review (Spring, 1978), pp. 21-24.
^ G e r a l d G. U d e ll, "The SBI In n o v ation Program: Inv olvin g
S tu d en ts In The Inno vatio n P r o c e s s ," Jo u rn al o f Small Business Management,
Vol. 17, No. 1 ( J a n u a r y ,1979), pp. 4 -6 .
4 lL ouis Laun, I n s i g h t , Vol. 3 No. 3 (December, 1975), p. 1.
42Larry B ram blett and W illiam C. F le w e lle n , "The Small Business
Development C en ter Program f o r G e o rg ia," AACSB B u l l e t i n (S pring, 1978),
pp. 107.
43U.S. Congress, House, Committee on Small B u s in e ss , Hearings
On SBA and SBIC A u th o rity and General Small Business Problem s, 95th
C ong., 2nd S e s s . , 1978, p. 381.
44I b i d . , p. 381.
43The d e s c r i p t i o n o f th e U n iv e r s ity o f Georgia SBDC i s based on
th e fo llo w in g documents:
(A)

Proposal f o r Development o f U n iv e r s ity Development C e n te r ,
P repared by t h e College o f Business A d m in is tr a tio n , th e
U n iv e r s ity o f Georgia and Subm itted to th e U.S. Small
Business A d m in istra tio n (October, 1976).

56

(B)

F i r s t Q u a rte r Report - October 1. 1977 - December 1. 1977.
Prepared by th e Small Business Development C e n te r , th e
U n iv e r s ity o f Georgia f o r th e U.S. Small Business Adminis­
t r a t i o n (December, 1977).

(C)

S t a t e o f Georgia Small Business Extension Program. Prepared
f o r : Dr. George L. Simpson, C h a n c e llo r, th e U n iv e r is ty
System o f G eo rg ia, by th e U n iv e r s ity Business Development
C e n te r, th e U n iv e r s ity o f Georgia (August, 1977).

(D)

The Small Business Development C en ter Program f o r G e o rg ia .
F i r s t Annual R ep o rt, th e U n iv e r s ity o f G eo rg ia, C o lleg e o f
Business A d m in istra tio n (May, 1978).

4®Bently C lark A s s o c ia te s , I n c . , An In-Depth Study o f E ig ht
Small Business Development C e n t e r s , A F in al R eport Subm itted t o th e
Small Business A d m in istra tio n (A u g u st,1979), pp. 1 -5 , 1-6.
47I b i d . , p. 1-6.
4 3 l b i d . , p. 1-7.

CHAPTER III
METHODOLOGY

The purposes o f t h i s stu d y a r e as fo llo w s :

(1) t o c o l l e c t

d e t a i l e d and f a c t u a l in fo rm atio n t h a t w i l l en ab le th e r e s e a r c h e r to
a s s e s s th e f e a s i b i l i t y and d e s i r a b i l i t y o f e s t a b l i s h i n g a small b u s i­
ness development c e n t e r program t h a t i s a d m in iste re d through th e b u s i­
ness c o lle g e s a t M ichig an's p u b lic f o u r - y e a r c o lle g e s and u n i v e r s i t i e s ;
(2) to s e c u re r e l e v a n t views and in fo rm a tio n from th e b u sin ess deans
concerning s p e c i f i c i s s u e s and o p e r a tio n a l concerns in vo lved in d e s ig n ­
ing and implementing a small b u s in e s s development c e n t e r program; (3) to
an aly ze th e e x t e n t o f agreement o r disag reem en t on th e i s s u e s and con­
c ern s examined; and (4) t o develop from th e in te rv ie w d a ta a s e t o f
norm ative s ta te m e n ts concerning th e d e s i r a b l e c h a r a c t e r i s t i c s o f a small
b u s in e s s development c e n t e r program in Michigan.
The P o p u latio n and Sample
The p o p u la tio n was composed o f a l l deans o f b u sin e ss an d /o r
management sch o o ls o r c o lle g e s a t th e f i f t e e n p u b l i c , f o u r - y e a r c o l ­
leg es and u n i v e r s i t i e s in Michigan.
s e l e c t e d f o r th e p i l o t in te rv ie w .

Two o f th e f i f t e e n deans were
The sample was composed o f the

rem aining t h i r t e e n deans.

57

58

The Research In te rv ie w
P ersonal In te rv ie w s were conducted in o r d e r to o b ta in d a ta f o r
t h i s s tu d y .
re a s o n s .

The p erson al in te rv ie w method was s e l e c t e d f o r s e v e ra l

Van Dalen r e p o r t s t h a t , "Many people a r e more w i l l i n g to

communicate In fo rm atio n v e r b a l l y th an in w r i ti n g and, t h e r e f o r e , w i l l
pro vid e d a ta more r e a d i l y and f u l l y in an in te r v ie w than on a q u e s tio n
n a ire ." l

For t h i s re a s o n , th e use o f a survey q u e s ti o n n a i r e as a to o l

f o r d a ta c o l l e c t i o n was deemed t o be i n a p p r o p r i a t e .
Hyman n o tes some o f th e advantages o f th e in te rv ie w :
A v a r i e t y o f g ain s r e s u l t from t h e f a c t t h a t th e i n t e r v i e w e r ,
w h ile he might be a b ia s in g a g e n t, m ight co n ceiv ab ly be an
i n s i g h t f u l , h e lp fu l p e rso n . He might be a b le t o am p lify a
given q u e s ti o n , probe f o r c l a r i f i c a t i o n o f an ambiguous
answ er, o r e l a b o r a t i o n o f a c r y p t i c r e p o r t , o r t o persuade
th e resp on dent t o answer a q u e s tio n t h a t he would o t h e r ­
w ise s k ip . All such advantages in v o lv in g th e i n s i g h t f u l
and r e s o u r c e f u l in te r v i e w e r a r e l o s t in th e s e l f ­
a d m i n i s t r a t in g s i t u a t i o n where m istak es o f th e resp o n d en t
have a q u a l i t y o f f i n a l i t y . 2
There a r e , however, s e v e ra l l i m i t a t i o n s which any r e s e a r c h e r
must c o n s id e r in using th e perso nal in te r v ie w te c h n iq u e .

The major

d isad v a n ta g e i s th e p o s s i b i l i t y o f ind ucing g r e a t e r s u b j e c t i v i t y and
p o s s i b le b ia s i n t o d a ta c o l l e c t i o n .

D escribed by Borg:

The very a d a p t a b i l i t y gained by th e i n t e r p e r s o n a l s i t u a t i o n
le a d s to s u b j e c t i v i t y and p o s s i b l e b i a s . The I n t e r a c t i o n s
between th e resp on den t and th e i n t e r v i e w e r a r e s u b j e c t to
b ia s from many s o u rc e s . Eagerness o f th e resp o n d en t t o
p le a s e t h e i n t e r v i e w e r , a vague antagonism t h a t sometimes
a r i s e s between th e in t e r v i e w e r and th e r e s p o n d e n t, and th e
tendency o f th e in te r v ie w e r to seek o u t answers t h a t s u p p o rt
h i s preconceived n o tio n s a r e b u t a few o f th e f a c t o r s t h a t
c o n t r i b u t e to p o s s ib le b ia s in g o f d a ta o b ta in e d from th e
i n t e r v i e w .^
Good l i s t s s e v e ra l p o s s ib le so u rces o f e r r o r and b i a s :

59

1.
2.
3.
4.
5.
6.

An in ad eq u ate number and le n g th o f in te rv ie w s
Lack o f r a p p o r t and i n s e n s i t i v i t y t o th e in te rv ie w e e .
An uncom fortable o r u n re la x in g s e t t i n g .
The d e s i r e o f in te rv ie w e e s t o make a good im p ressio n .
The r e l u c t a n c e o f many s u b j e c t s t o re v e a l h ig h ly
p erso n al in fo rm a tio n t h a t might app ear damaging to
th e in te rv ie w e e .
A la c k o f con fid en ce in o r r e s p e c t f o r th e i n t e r v i e w e r ,
on t h e p a r t o f t h e i n t e r v i e w e e . 4
At th e same tim e , Bingham, More, and Gustad p o i n t o u t t h a t :

Sources o f u n r e l i a b i l i t y in h e r e in th e i n t e r v i e w e r , in
th e person in te rv ie w e d , and in th e r e l a t i o n s h i p between
th e two. P a r a d o x ic a lly , i t i s p r e c i s e l y t h e s e same
elem ents which make th e in te r v ie w a v a lu a b le in s tru m e n t.
The d i f f e r e n c e l i e s in th e conduct o f th e i n te r v ie w and
th e q u a l i t y o f th e r e l a t i o n s h i p . 5
All o f th e above f a c t o r s were taken i n t o c o n s id e r a tio n d uring
th e developmental s ta g e s o f fo rm u la tin g an in te r v ie w g u id e.

L ikew ise,

in conducting th e i n t e r v i e w s , th e I n v e s t i g a t o r attem p ted to e l i m in a t e
th o s e f a c t o r s which would b ia s th e d a ta c o l l e c t e d .
An in te rv ie w guide was developed f o r th e purpose o f s t r u c t u r i n g
th e in t e r v ie w s .

As s t a t e d in C hapter I , t h e concerns ad d ressed

in t h e

in te r v ie w guide were d e riv e d from a review o f th e l i t e r a t u r e and from
a c a r e f u l stu d y o f th e e x p e rie n c e s o f e i g h t p i l o t Small Business Develop­
ment C en ter programs as r e p o r te d in v a rio u s C ongressional h e a r i n g s ,
d e s c r i p t i v e m a t e r ia l s and management r e p o r t s provided by th e d i r e c t o r s
o f p i l o t SBDC programs a t an in fo rm a tio n s h a rin g co n feren c e i n 1978.
The concerns a l s o r e f l e c t , in p a r t , i s s u e s a r i s i n g from th e program
development r e s p o n s i b i l i t i e s o f th e w r i t e r .
A l e t t e r e x p la in in g th e p r o j e c t and a copy o f H.B. 5058 was
s e n t to each o f th e b u s in e s s deans.

Follow-up te le p h o n e c a l l s were

th en made to a r ra n g e appointm ent d a te s and tim e s .

I t was l e f t to

60
each d e a n 's d i s c r e t i o n w hether o r n o t t o in c lu d e o t h e r s t a f f in the
i n te r v ie w s .

In tw elve o f th e v i s i t s , th e r e s e a r c h e r t a l k e d only w ith

th e dean; in t h r e e o f th e i n te r v i e w s , th e r e s e a r c h e r t a l k e d w ith o th e r
members o f th e s t a f f as w e l l .
Two t r i a l runs o f th e in te r v ie w were performed p r i o r t o i n t e r ­
viewing th e rem ainder o f th e deans.

In both c a s e s , th e t r i a l s were

performed so t h a t any problems in th e in te r v ie w form at could be
i d e n t i f i e d and c o r r e c te d p r i o r to conducting th e in te rv ie w s w ith th e
rem aining t h i r t e e n deans.
th e s tu d y .
h o u rs.

The t r i a l in te rv ie w s were n o t in c lu d e d in

Each o f th e in te rv ie w s took ap pro xim ately one and o n e - h a lf

All o f th e in te rv ie w s were conducted between March 27 and

May 22, 1980.
Since th e s ta n d a rd iz e d q u e s tio n s in c o r p o ra te d in th e in te rv ie w
guide were based on th e purposes and prem ises o f th e s tu d y , th e i n t e r ­
view er d id e x e r c i s e judgment in ask in g probing q u e s tio n s when th e
r e s p o n d e n ts ' answers seemed incom plete o r vague.

A copy o f th e

in te rv ie w guide i s lo c a te d in Appendix B.
An im p o rta n t c o n s id e r a tio n in th e development o f an in te rv ie w
in stru m e n t i s th e method o f r e c o rd in g th e respo nses o f th e p a r t i c i ­
p a n ts .

The method used in t h i s s tu d y was th e c a s s e t t e r e c o r d e r .

method was s e l e c t e d f o r s e v e r a l r e a s o n s .

This

F i r s t , th e e n t i r e t e x t o f th e

in te r v ie w could be reco rd ed so t h a t t o t a l r e c a l l was p o s s i b l e by
r e p la y in g th e c a s s e t t e .

Second, th e use o f th e c a s s e t t e r e c o rd e r

a f fo r d e d th e r e s e a r c h e r th e freedom o f c o n c e n tr a tin g t o t a l l y on th e
i n te rv ie w i t s e l f w ith o u t being h ind ered by ta k in g n otes and re c o rd in g
resp on ses on p ap er.

T h ir d , c a s s e t t e re c o rd in g made th e p o s t e r i o r i

a n a l y s i s much e a s i e r and more s y s te m a tic .

61
Borg has noted some o f th e fo llo w in g advantages a s s o c i a te d
w ith th e tech n iq u e o f ta p e re c o rd in g th e in te rv ie w :

(1) th e tendency

o f in te r v ie w e r s t o s e l e c t d a ta fa v o rin g t h e i r b ia s i s reduced; (2) a
thorough a n a l y s i s o f resp o n ses can be made d u rin g s e v e ra l ta p e play
back s; and (3) t h e in te rv ie w p ro cess i s speeded up s in c e note ta k in g
by th e i n t e r v i e w e r i s n o t n e c e s s a r y .6
I t should be noted t h a t perm issio n o f th e respo nd ents to record
th e in te rv ie w s was re q u e ste d p r i o r t o conducting th e in te rv ie w s and,
f o r t u n a t e l y , a l l o f th e p a r t i c i p a n t s in t h i s s tu d y g ran ted such p e r ­
m issio n .
The Method o f Data A n aly sis
The approach to t h i s stud y was d e s c r i p t i v e in method.

Best

s ta te s th a t d e s c rip tiv e research:
. . . in v o lv e s th e d e s c r i p t i o n , r e c o r d in g , a n a l y s i s ,
and i n t e r p r e t a t i o n o f th e p r e s e n t n a t u r e , co m p osition ,
o r p ro cess o f phenomenon. The focus 1s on p r e v a il in g
c o n d i t i o n s , o r how a p e r s o n ,7group, o r th in g behaves
o r f u n c tio n s in th e p r e s e n t . 7
The stu d y was a l s o e x p lo r a to r y in n a t u r e .

Good and S cates

c h a r a c t e r i z e d th e e x p lo r a to r y approach:
General d e s c r i p t i o n i s c h a r a c t e r i s t i c o f th e e a r l y
s ta g e s o f work in an a r e a where th e s i g n i f i c a n t f a c t o r s
have n o t been I s o l a t e d , and where perhaps one would n o t
have th e means f o r measuring them i f th ey were i d e n t i ­
f i e d . I t i s , t h e r e f o r e , a method o f e x p l o r a t i o n . 8
Due t o th e e x p lo r a to r y n a tu r e o f th e s tu d y , th e i n v e s t i g a t o r
b e lie v e d th e d e s c r i p t i v e te c h n iq u e was th e b e s t method f o r p r e s e n tin g
th e f i n d i n g s .
rese a rc h .9

Van Dalen has sug gested s e v e ra l advantages o f d e s c r i p t i v e

S tu d ie s o f a d e s c r i p t i v e n a tu r e f r e q u e n t l y provide p r a c t i c a l

62

and u s e fu l in fo rm a tio n f o r p la n n in g , a l e r t e d u c a to rs t o f u t u r e t r e n d s ,
and f a c i l i t a t e an u n d erstan d in g o f th e c u r r e n t s t a t u s in a re a s where
procedures a r e p e r p e t u a l l y in t r a n s i t i o n .

This stu d y was undertaken

n o t only to do r e s e a r c h 1n an a re a where l i t t l e r e s e a r c h has been done
b u t a l s o t o p rov ide u s e fu l i n s i g h t s f o r th e enhancement o f f u t u r e
program development e f f o r t s .

The d e s c r i p t i v e approach seemed b e s t

s u it e d t o meet th e needs and o b j e c t i v e s o f t h i s s tu d y .
A f te r each in t e r v i e w , th e r e s e a r c h e r l i s t e n e d t o th e tap es
w ith a copy o f th e in te rv ie w fo rm at as a g u id e .

As answers t o th e

q u e s tio n s on th e in te rv ie w form at were g iv e n , th e y were t r a n s c r i b e d
on th e a p p r o p r i a t e page o f th e in te r v ie w fo rm a t.

Two jud ges were

asked t o p a r t i c i p a t e in th e stud y a t t h i s p o i n t .

Mr. Del W i l l i s , a

g rad u ate s tu d e n t in th e f i e l d o f c o n tin u in g e d u c a tio n a t th e U n iv e r s ity
o f Michigan, and Dr. Thomas J o h n s to n , o f th e Research and M arketing
D iv isio n o f th e Michigan O ffic e o f Economic Development, were each
su p p lie d w ith ta p e s o f th e f i r s t two in te rv ie w s and asked to l i s t e n
t o th e ta p e s and w r i t e th e a d m i n i s t r a t o r 's answers to th e q u e s tio n s on
th e in te rv ie w fo rm at.

They were i n s t r u c t e d t o w r i te th e answers

v erbatim and to in c lu d e a l l q u a l i f y i n g s ta te m e n ts re g a rd in g th e q u e s tio n
or issu e.

The r e s e a r c h e r c o l l e c t e d th e co p ies o f th e I n te rv ie w form ats

which were used by th e judges, and a m eeting o f th e r e s e a r c h e r and th e
two judges was h e ld .

Answers were compared and th e judges determ ined

t h a t t h e i r answers and th o se o f th e r e s e a r c h e r were th e same and i n ­
s t r u c t e d th e r e s e a r c h e r to proceed w ith t h i s phase o f th e stud y
in d ep en d en tly .

63
The r e s e a r c h e r th en l i s t e n e d t o th e rem ainder o f th e ta p e s and
reco rd ed th e answers.

The d a ta were th en c o l l a t e d acco rdin g t o th e

s p e c i f i c q u e s tio n s asked and th e answers g iv en .

In some cases* th e

answers were sim ple "yes" o r "no" an sw ers, e a s i l y I d e n t i f i a b l e and
e a s i l y c a t e g o r iz e d .

In o t h e r c a s e s , t h e answers were q u i t e d i f f e r e n t

and c a t e g o r i e s were d i f f i c u l t to d eterm in e.

In a few c a s e s , th e

answers given by th e in te rv ie w e e s could n o t be c a te g o r i z e d , so each
d i f f e r e n t answer was l i s t e d s e p a r a t e l y .

Due to t h i s f a c t , some o f th e

t a b l e s show many answers t o th e same q u e s ti o n .

The d a ta were then

p u t i n t o t a b l e form, and th e p erc e n ta g e t h a t each answer r e p re s e n te d o f
th e t o t a l sample was computed.
The d a ta have been p re s e n te d in C hapter IV.

64

NOTES-CHAPTER I I I

iDeobold B. Van D alen, U nderstanding E ducational Research
(New York: McGraw-Hill, 1962), p. 258.
^H erbert H. Hyman, In te rv ie w in g In S ocial Research (Chicago:
U n iv e rs ity o f Chicago P r e s s , 1954), p. 16.
8Wa1ter R. Borg, Educational Research:
(New York: D. McKay C o ., 1963), p. 221.

An I n tr o d u c tio n

^ C a rte r V. Good, I n tr o d u c tio n t o E ducational Research
(2nd e d . ; New York: A p p le to n -C e n tu ry -C ro fts, 1963), pp. 295-296.
^W alter Bingham, Bruce Moore and John W. G ustad, How to
In te rv iew (4 th r e v . e d . ; New York: H arper, 1959), p. 9.
6Borg, op. c i t . , p. 225.
7john W. B e s t, Research in Education (Englewood C l i f f s ,
New J e r s e y : P r e n t i c e - H a l l , 1950), p. 12.
8C a r t e r V. Good and Douglas E. S c a te s , Methods o f Research:
E d u c a tio n a l, P s y c h o lo g lc a l, S o c io lo g ic a l (New York: A ppleton-Century
C r o f t s , 1950), p. 275.
^Van D alen, op. c i t . , p. 184.

CHAPTER IV
ANALYSIS OF RESULTS

The purposes o f t h i s stud y were as fo llo w s :

(1) to c o l l e c t

d e t a i l e d and f a c t u a l in fo rm atio n t h a t would en a b le th e r e s e a r c h e r to
a s s e s s th e f e a s i b i l i t y and d e s i r a b i l i t y o f e s t a b l i s h i n g a small b u s i­
ness development c e n te r program t h a t would be a d m in is te re d through th e
b u sin e ss c o lle g e s a t M ich igan's p u b lic f o u r - y e a r c o l l e g e s and u n iv e r ­
s i t i e s ; (2) to secu re r e l e v a n t views and in fo rm a tio n from th e b u sin e ss
deans concerning s p e c i f i c i s s u e s and o p e r a tio n a l concerns involved in
d e sig n in g and implementing a small b u s in e s s development c e n t e r program;
(3) to a n aly ze th e e x t e n t o f agreement o r d isag reem en t on th e i s s u e s
and concerns examined; and (4) t o develop from th e in te r v ie w d a ta a s e t
o f norm ative s ta te m e n ts concerning th e d e s i r a b l e c h a r a c t e r i s t i c s o f a
small b u s in e s s development program in M ichigan.
In o r d e r to ad d ress th e g o a ls s t a t e d above, seven a re a s o f
concern were i d e n t i f i e d , and s p e c i f i c problems o r m a tte rs o f i n t e r e s t
w ith in each a re a o f concern were ad d ressed i n each o f th e in te rv ie w s
w ith th e b u s in e s s c o lle g e deans.

The in te r v ie w resp on ses were

summarized and a r e p re s e n te d in n a r r a t i v e form in t h i s c h a p te r .
d a ta have been p re se n te d in Appendix C.

The

I t was f e l t t h a t th e t e x t

could be more e a s i l y read i f th e d a ta were p re s e n te d in t h i s f a s h io n .
Each q u e s tio n asked o f th e b u s in e s s deans has been numbered and has been

66
r e f e r r e d t o by number 1n th e t e x t .

All q u e s tio n s p re s e n te d in Appendix

B have been d is c u s s e d in t h e t e x t o f t h i s c h a p te r .
Concern 1 - The P o t e n t i a l f o r I n t e g r a t i n g th e Small Business
A s s is ta n c e Program w ith th e I n s t r u c t i o n a l Programs
o f th e Business C o lle g e s/S c h o o ls
Eleven (78%) o f th e deans i n d ic a t e d t h a t th ey c u r r e n t l y do
o f f e r small b u sin e ss co u rses as a p a r t o f t h e i r academic programs.
deans (14%) i n d i c a t e d

t h a t th ey do n o t o f f e r small b u s in e s s

Two

co urses

(Question 1 ).
Of th o se i n s t i t u t i o n s t h a t do o f f e r small b u sin ess c o u r s e s ,
s i x o f f e r e d one c o u r s e , two i n s t i t u t i o n s o f f e r e d two c o u r s e s , and th r e e
i n s t i t u t i o n s o f f e r e d t h r e e co u rses (Question 2 ) .
Ten o f th e s e c o u rse s were d esign ed f o r g ra d u a te s t u d e n t s , and
elev en co u rse s were design ed f o r un d erg rad u ate s tu d e n ts (Question 3 ) .
Six o f th e g ra d u a te co u rses were o f f e r e d in c o n ju n c tio n w ith a Small
Business I n s t i t u t e program.

Four o f th e g ra d u a te co u rses focused on

e n tr e p r e n e u r s h ip and problems r e l a t e d to c r e a t i n g a small b u s in e s s .
The u n d erg rad uate c o u r s e s , f o r th e most p a r t , were e n t i t l e d Small
Business Management, and examined management problems and r e s p o n s i­
b i l i t i e s in such a r e a s as d e c isio n -m a k in g , m a rk e tin g , f in a n c e ,
p ersonnel s e l e c t i o n , r e c o rd k e e p in g , t a x e s , and c o n t r o l s .
When asked i f t h e i r b u s in e s s school had developed a formal
s p e c i a l i z a t i o n in small b u s in e s s as a p a r t o f t h e i r academic programs
(Q uestion 4 ) , two deans (16.3%) responded t h a t t h e i r b u sin e ss
s tu d e n ts had th e o p tio n o f m ajoring in small b u s in e s s management
a t th e u n d erg rad u ate l e v e l .

At one i n s t i t u t i o n t h i s m ajor invo lved

t h r e e b a s ic co u rses p lu s g en eral e l e c t i v e s .

At th e o t h e r i n s t i t u t i o n s

67
th e s t u d e n t s ' major was comprised o f one small b u s in e s s management
cou rse p lu s e l e c t i v e s .

Two deans (15.3%) r e p o r te d t h a t a formal

s p e c i a l i z a t i o n in small b u s in e s s was c u r r e n t l y being developed.

One

o f th e programs being planned in clu d ed th e development o f an under­
g ra d u a te m ajor w ith small b u sin ess co u rses i n m ark etin g , a c c c o u n tin g ,
and e n t r e p r e n e u r s h ip , p lu s e l e c t i v e s .

The o th e r program being planned

was e i t h e r in te n d e d to be a o n e-y ear c e r t i f i c a t e o r a tw o-year
a s s o c i a t e degree in small b u s in e s s management.
Four deans (30.7%) r e p o rte d t h a t d eveloping a formal s p e c i a l i ­
z a tio n in small b u s in e s s had been c o n s id e re d , b u t no s p e c i f i c a c tio n s
had been ta k e n .
Various e x p la n a tio n s were o f f e r e d by th e s e f o u r deans:
I'm n o t s u re we would want to s e p a r a t e i t o u t as an o p tio n
because small b u sin e ss permeates th e e n t i r e cu rric u lu m as
a general o r i e n t a t i o n - due to th e dominance o f small
b u s in e s s in t h i s r e g io n .
The problem q u ic k ly becomes t h a t o f a lack o f f a c u l t y .
We would have t o g iv e up some o th e r a re a t o add t h i s .
The d e c is io n t o go ahead hinges on one o r two key f a c u l t y
members d e c id in g i t i s time f o r them, p e r s o n a l l y , to
in c o r p o r a te t h i s as a fo c u s.
I t was determ ined t h a t i t i s prem ature f o r us t o ta k e
any a c t i o n . Because o f our involvem ent w ith SBA we
have asked o u r s e lv e s , "What next?" R ight now we a re
w atching f e d e r a l t r e n d s . . . . I t w i l l be a couple o f y e a r s
b e fo re we look a t t h i s ag ain u n le ss some new impetus
a rise s.
Five deans (38.4%) r e p o rte d t h a t th e id e a o f developing a
s p e c i a l i z a t i o n in small b u sin e ss

as a p a r t o f t h e i r cu rric u lu m had not

been- c o n s id e re d .

deans e x p la in e d t h a t w h ile th ey

Three o f th e s e

do

o f f e r co u rses in small b u s in e s s management, t h e i r school does n o t
o f f e r majors o r m inors.

The remaining two deans ex p ressed th e d e s i r e

68

t o c o n s id e r th e p o s s i b i l i t y o f developing a small b u s in e s s s p e c i a l i ­
z a tio n in th e f u t u r e .
In ev ery c a s e , i t appeared to t h i s r e s e a r c h e r t h a t th e e x i s t ­
ence o f small b u s in e s s co urses was due s o l e l y t o th e f a c t t h a t one,
two, o r t h r e e f a c u l t y members had a s p e c ia l i n t e r e s t in small b u s in e s s .
A lso , i t i s r e l e v a n t to no te t h a t s e v e ra l deans ex p ressed th e
o p in io n t h a t high s tu d e n t en ro llm en ts in r e c e n t y e a r s have k e p t th e
p r e s s u re on them to b u ild and m ain tain a high q u a l i t y f a c u l t y in th e
e x is tin g areas of s p e c ia liz a tio n .
E ig h t (61.5%) o f th e b u s in e s s c o lle g e s o f f e r l i f e - l o n g le a r n in g
programs f o r small b u s in e s s e s , i . e . , s h o r t- te r m sem inars and workshops
designed f o r and marketed t o small b u s in e s s (Q uestion 5 ) , and a t f i v e
(38.4%) o f th e i n s t i t u t i o n s , th e co u rses a re ta u g h t p r im a r ily o r e x c lu ­
s iv e l y by f u l l - t i m e f a c u l t y members.

In two (15.3%) o f th e i n s t i t u t i o n s ,

th e mix between f u l l - t i m e f a c u l t y and a d ju n c t f a c u l t y members was f a i r l y
w e ll- b a la n c e d .

And 1n two (15.3%) o f th e i n s t i t u t i o n s , t h e r e was only

li m i t e d p a r t i c i p a t i o n on th e p a r t o f f u l l - t i m e f a c u l t y members.

At

th o se i n s t i t u t i o n s in which th e small b u sin e ss sem inars and workshops
were ta u g h t p r im a r il y o r e x c lu s iv e ly by f u l l - t i m e f a c u l t y members, th e
deans ex p ressed th e view t h a t th e s e programs were a u s e fu l form o f
p u b lic s e r v i c e t o t h e i r p a r t i c u l a r communities.
Two deans ex p ressed t h e i r i n t e n t i o n to in v o lv e t h e i r f a c u l t y
i n t h i s kind o f a c t i v i t y a t some p o i n t in th e f u t u r e .
Three (23%) o f th e b u s in e s s c o lle g e s o f f e r small b u sin e ss
sem inars and workshops th ro u g h o u t a reg io n o f th e s t a t e .

The rem ainder

o f th e b u sin e ss c o lle g e s o f f e r programs on campus and in th e lo c a l
community (Q uestion 7 ).

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Five (38.4%) o f th e e i g h t c o lle g e s p ro v id in g l i f e - l o n g le a r n in g
programs f o r small b u s in e s s e s had e i t h e r e s t a b l i s h e d s e r v i c e - o r i e n t e d
management c e n t e r s w ith in th e c o lle g e which were r e s p o n s ib le f o r th e
d e l i v e r y o f th e s e programs o r had given t h a t r e s p o n s i b i l i t y to a
f a c u l t y member.

The o th e r t h r e e c o lle g e s worked c l o s e ly w ith t h e i r

i n s t i t u t i o n ' s c o n tin u in g e d u c a tio n d i v i s i o n .
To some e x t e n t , i t was found t h a t b u s in e s s scho ols involved
t h e i r s tu d e n ts in working d i r e c t l y w ith small b u s in e s s e s as a p a r t
o f t h e i r academic programs.

T his involvem ent i s arrang ed through

c o o p e ra tiv e e d u c a tio n programs, i n t e r n s h i p s , c o u r s e - r e l a te d f i e l d
p r o j e c t s , and through Small Business I n s t i t u t e programs.
Twelve b u sin e ss c o lle g e s (92.3%) o f f e r e d s e r v i c e - l e a r n i n g
programs t h a t gave s tu d e n ts th e o p p o r tu n ity to have d i r e c t c o n ta c t
w ith a small b u s in e s s (Q uestion 9 ) .

S everal deans hastened t o add,

however, t h a t w hile t h i s was t r u e , c o n t a c t w ith small b u s in e s s e s was
n o t a conscious o b j e c t i v e - w ith th e e x c e p tio n o f th e SBI programs.
Two o f th e deans (15.3%) i n d i c a t e d t h a t t h e i r c o lle g e s d id n o t sponsor
any s e r v i c e - l e a r n i n g programs f o r t h e i r s tu d e n ts w ith th e e x c e p tio n o f
o c casio n al c o u r s e - r e l a t e d p r o j e c t s .
E ig h t (.6 1 . 5 %) o f th e b u s in e s s c o lle g e s r e p o r te d spo nsorin g
c o o p e ra tiv e e d u c a tio n programs (Q uestion 10).

Only two deans s a id

t h a t t h e i r c o o p e ra tiv e e d u c a tio n programs were o r ie n te d p r im a r ily
toward small b u s in e s s e s ( r e t a i l and s e r v i c e - o r i e n t e d b u s in e s s e s ) .
Four deans s a id t h a t t h e i r c o o p e r a tiv e e d u c a tio n programs were o r ie n te d
l a r g e l y toward b ig b u s in e s s e s .

In th e view o f one d ean , "small

b u s in e s s e s have a hard tim e q u a l i f y i n g f o r co-op assignm ents because
th ey to o o f te n p rov ide a poor e d u c a tio n a l environment and a r e unable

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t o p ro vid e th e s tu d e n t w ith a s u f f i c i e n t amount o f p erson al s u p e r v i s io n ."
Another dean ex pressed th e view t h a t i t i s more cumbersome to work w ith
small b u s in e s s in s e t t i n g up co-op programs because " th e s e firm s d o n 't
u s u a lly want t o commit t o do 1 t more than once o r tw ic e ."
E ig h t o f th e b u sin e ss c o lle g e s (61.5%) provided I n te r n s h i p p ro ­
grams f o r t h e i r s tu d e n t s .

A gain, only two deans r e p o rte d t h a t t h e i r

i n t e r n s h i p programs were p r im a r i l y o r ie n te d toward small b u s in e s s e s .
Four o f th e programs were lim ite d to a s i n g l e f u n c tio n a l a re a such as
acco u n tin g o r o f f i c e a d m i n i s t r a t i o n .

Only one i n s t i t u t i o n r e p o rte d

having a l a r g e , w ell-rounded i n t e r n s h i p program in which every d e p a r t­
ment had an i n t e r n s h i p c o o r d in a to r and every s e n i o r s tu d e n t could
e n r o l l f o r up t o s i x c r e d i t hours f o r an i n t e r n s h i p p r o j e c t .
Four b u s in e s s c o l l e g e deans (30.7%) r e p o r te d t h a t t h e i r
s tu d e n ts have d i r e c t involvem ent w ith small b u s in e s s e s on a sp o ra d ic
b a s is through such means as c o u r s e - r e l a t e d f i e l d p r o j e c t s and indepen­
dent s tu d ie s .
Seven (53.8%) o f th e b u sin e ss c o lle g e s r e p o r te d having a con­
t r a c t w ith th e Small Business A d m in istra tio n t o o p e r a te a Small B usi­
ness I n s t i t u t e program.

The b u s in e s s deans a t each o f th e s e i n s t i t u ­

t i o n s ex p ressed t h e i r b e l i e f t h a t th e SBI program was very b e n e f i c i a l
f o r th e s tu d e n ts t h a t p a r t i c i p a t e d in i t as well as being b e n e f ic i a l
f o r th e small b u sin e ss c l i e n t s (Q uestion 1 1).

(One o f th e two i n ­

s t i t u t i o n s in clu d ed in th e p i l o t stu d y a l s o r e p o r te d having an SBI
program.)

Four b u sin e ss deans ex p ressed th e view t h a t th ey would be

i n t e r e s t e d in expanding t h i s program i f t h i s were p o s s i b le (Question
12).

Only two b u sin e ss deans were opposed t o expanding t h e i r SBI

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program, and one dean was u n c e r t a in .

However, t h e r e was a c l e a r

consensus t h a t given c u r r e n t re so u rc e s I t would n o t be p o s s i b l e t o
expand t h i s program (Q uestion 13).
Six o f th e seven b u s in e s s deans ex p ressed th e I n te n t i o n o f
c o n tin u in g th e SBI program I n d e f i n i t e l y , and only one dean s t a t e d t h a t
he did n o t in te n d to see t h i s program co n tin u ed i n d e f i n i t e l y (Q uestion
14).
One dean ex p ressed u n c e r t a i n t y about th e p o s s i b i l i t y o f ex­
panding th e SBI program a t h i s I n s t i t u t i o n , b u t s i x deans gave reaso n s
as to why th ey thought t h i s would n o t be f e a s i b l e i n c lu d in g :

(1) a

la c k o f f a c u l t y r e s o u r c e s ; (2) d i f f i c u l t y in e n r o l l i n g more than th e
e x i s t i n g number o f s tu d e n ts p a r t i c i p a t i n g in th e program each y e a r ;
(3) lack o f f a c u l t y i n t e r e s t ; and (4) u n a v a i l a b i l i t y o f in c re a s e d
fin a n c in g from SBA.
There a r e v ario u s f r u s t r a t i o n s and d i f f i c u l t i e s a s s o c i a t e d
w ith th e r e s p o n s i b i l i t y o f a d m in is te r in g a SBI program (Q uestion 15).
Three deans mentioned t h a t th e SBA d o e s n 't r e f e r a s u f f i c i e n t volume
o f c l i e n t s , which leav es th e burden o f s o l i c i t i n g and s c re e n in g o f
p o t e n t i a l small b u sin ess c l i e n t s 1n th e hands o f th e f a c u l t y SBI
c o o r d in a to r .

At one i n s t i t u t i o n , th e SBI c o o r d in a to r had d i f f i c u l t y

s e c u rin g s tu d e n t p a r t i c i p a t i o n because most o f th e b u s in e s s c o ll e g e
s tu d e n ts a t t h a t i n s t i t u t i o n worked p a r t - t i m e and were n o t a v a i l a b l e
t o p a r t i c i p a t e 1n th e SBI program.

One dean e x p la in e d th e problems

involved in t r y i n g to c o o r d in a te u n i v e r s i t y a c t i v i t i e s w ith an e x te r n a l
agency whose r u le s and tim e frames a r e n o t com patible w ith th e sem ester
system:

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For i n s t a n c e , s tu d e n ts must r e g i s t e r e a r l y f o r academic
programs and t h a t i s too e a r l y f o r us t o handle th e SBA
program because we a r e n o t s u re what c o n t r a c t we w i ll
have, which o f our f a c u l t y w i l l handle i t , how many
c a s e s we w i l l have, and i t i s d i f f i c u l t t o p la n . Typi­
c a l l y , we begin a sem e ster n o t knowing who th e c l i e n t s
a r e , how many t h e r e w i l l be and how many s tu d e n ts we
need.
According to a n o th e r b u s in e s s d ean , p a r t i c i p a t i n g 1n th e SBI
program ran c o u n te r to f a c u l t y reward s t r u c t u r e , an d , c o n s e q u e n tly ,
he had t r o u b l e keeping f a c u l t y i n t e r e s t e d in s u p p o rtin g th e program.
Another dean s t a t e d t h a t given t h e l o c a t i o n o f h is i n s t i t u t i o n ,
m eeting w ith c l i e n t s o f te n in vo lved long d i s t a n c e t r a v e l which d i s ­
courages s tu d e n t p a r t i c i p a t i o n and

becomes wearisome t o th e SBI

c o o r d in a to rs o v er tim e.

a n o th e r b u sin e ss dean s t a t e d t h a t

And s t i l l

he f e l t t h a t th e SBA g r a n t f o r running th e program was n o t s u f f i c i e n t l y
rem u n erativ e.
The deans o f th e b u s in e s s c o ll e g e s
grams were asked i f th ey and t h e i r
e s t a b l i s h i n g an SBI program.
t h r e e s a id "no" (Question 16 ).

which do

n o t have SBIp ro ­

f a c u l t y had e v e r co n sid e red

Three b u s in e s s deans s a id " y e s ," and
Only f i v e deans gave reaso ns as t o

why th e y d id n o t have an SBI program.
Two deans e x p la in e d t h a t t h i s sim ply had n o t been a p r i o r i t y
concern.

One e x p la in e d t h a t , given t h e i r f a c u l t y reward s t r u c t u r e w ith

I t s emphasis on r e s e a r c h and p u b l is h i n g , i t was n o t rew arding f o r t h e i r
f a c u l t y to s e rv e as SBI program c o o r d i n a to r s .

Another dean e x p la in e d

t h a t h i s c o lle g e d id n o t have a g ra d u a te program, and t h a t a n o th e r
i n s t i t u t i o n nearby d id have an SBI program which s e rv ic e d t h a t p a r t
o f th e s t a t e .

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In f o u r I n s t a n c e s , i t was p o in te d o u t t h a t th e program was
s u c c e s s fu l and o p e r a ti v e because o f th e i n t e r e s t and d e d ic a tio n o f a
s i n g l e te n u re d f a c u l t y member who d id n o t r e c e iv e any a d d itio n a l
rem uneration f o r h i s o r h e r e f f o r t s .
Concern 2 - The P o t e n t i a l f o r I n t e g r a t i n g th e Small Business
A s s is ta n c e Program w ith th e Research A c t i v i t i e s o f th e
Business C o lle g e s/S c h o o ls
At seven o f th e b u s in e s s c o lle g e s v i s i t e d (53.8% ), th e deans
r e p o rte d t h a t th e y do have f a c u l t y members who s p e c i a l i z e in r e s e a r c h ­
ing small b u s in e s s t o p i c s (Q uestion 17 ).

Six b u s in e s s deans (46.1%)

re p o r te d t h a t none o f t h e i r f a c u l t y s p e c i a l iz e d in small b u sin e ss
research.
The number o f b u s in e s s c o l l e g e f a c u l t y members found t o be
s p e c i a l i z i n g in small b u s in e s s r e s e a r c h t o p i c s th ro u g h o u t th e s t a t e was
q u ite lim ited .

The numbers ranged from t h r e e small b u s in e s s r e s e a r c h e r s

a t one i n s t i t u t i o n , two small b u s in e s s r e s e a r c h e r s a t a n o th e r i n s t i t u ­
t i o n , and only one small b u s in e s s r e s e a r c h e r a t f i v e i n s t i t u t i o n s .
S everal f a c t o r s t h a t accou nt f o r t h i s gen eral la c k o f f a c u l t y
s p e c i a l i z a t i o n In small b u s in e s s as an a re a o f r e s e a r c h i n t e r e s t were
s u rfa c e d (Q uestion

is).

The most common e x p la n a tio n given ( s i x d ean s,

46.1%) was t h a t small b u s in e s s i s n o t a d i s c i p l i n e o r a s u b d i s c i p l i n e ,
p e r s e , and t h a t f a c u l t y t r y t o f in d n ich es w ith in d i s c i p l i n e s o r
s u b d i s c i p l l n e s i n which t o s p e c i a l i z e .

The second most common ex p lan a­

t i o n given ( fo u r d e a n s, 30.7%) was t h a t due t o t h e i r own g rad u ate p ro ­
grams, f a c u l t y members a r e o r ie n te d to l a r g e r b u s in e s s o r g a n i z a t i o n s .
I t was f e l t t h a t th e t r a d i t i o n a l r o l e o f a b u s in e s s c o l l e g e had been
t h a t o f p re p a rin g s tu d e n ts f o r c a r e e r s in l a r g e r b u s in e s s e s and t h a t

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co u rses In b u sin e ss c o lle g e s had been o r ie n te d t h a t way.

This o r i e n t a ­

t i o n , I t was p o in te d o u t , was s u s ta in e d by th e tex tb o o k s and th e
a c cred itin g a sso c ia tio n s.

Two deans (15.3%) p o in te d o u t t h a t th e

la c k o f a v a i l a b l e d a ta 1s a major b a r r i e r .

As one ex p re sse d 1 t :

There 1s no d a ta base f o r r e s e a r c h . I f you go t o a Burroughs
o r a GM, e v e ry th in g i s s e lf - c o n t a i n e d t h a t you would need f o r
a r e s e a r c h p r o j e c t . But go t o a small b u s i n e s s .. .y o u have t o
go to twenty o f them. T h a t poses a d d i ti o n a l problems.
One b u s in e s s dean, whose f a c u l t y members were l a r g e l y young and un­
te n u r e d , s p e c u la te d t h a t perhaps th e f a c t t h a t small b u s in e s s has n o t
been e s t a b l i s h e d as a d i s c i p l i n a r y s p e c i a l i z a t i o n , coupled w ith th e
need o f h is f a c u l t y members t o produce p u b l i c a t i o n s t h a t would le a d t o
promotion and t e n u r e , accounted f o r th e la c k o f f a c u l t y I n t e r e s t in t h i s
area.

And two o f th e deans in te rv ie w e d i n d i c a t e d t h a t t h e i r f a c u l t i e s

were e s s e n t i a l l y o r ie n te d toward te a c h in g r a t h e r th an r e s e a r c h .
Most o f th e deans ( n in e , 69.2%) f e l t t h a t th e e s ta b lis h m e n t o f
a Small Business Development C en ter a t t h e i r i n s t i t u t i o n would s ti m u la t e
more r e s e a r c h on small b u s in e s s problems (Q uestion 19).

Three (23%)

were n o t s u r e , and only one (7.6%) f e l t t h a t such an approach would n o t
s ti m u l a t e r e s e a r c h on small b u s in e s s .

Four b e lie v e d t h a t an SBDC could

f a c i l i t a t e r e s e a r c h 1 f I t could p ro v id e r e s e a r c h g r a n t s .

I t was sug­

g e s te d t h a t such a c e n t e r could go a f t e r f e d e r a l g r a n t money t o do
r e s e a r c h on small b u s in e s s .

Four f e l t t h a t t o th e e x t e n t t h a t an SBDC

could s u c c e s s f u l l y i d e n t i f y c l a s s e s o f problems and s u r f a c e p r o j e c t s
f o r f a c u l t y members t o focus on, i t would succeed in s t i m u l a t i n g r e ­
s e a rc h on small b u s in e s s .

Two ex p re sse d th e view t h a t th e p resen ce o f

an SBDC could in v o lv e more f a c u l t y members w ith small b u s in e s s e s ( e . g .
te a c h in g small b u sin e ss sem inars and workshops) which i n tu r n would

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c r e a t e an empathy and I n t e r e s t in s m a lle r b u s in e s s f ir m s .

One dean

q u a l i f i e d h is "yes" w ith th e view t h a t an SBDC would s ti m u l a te r e ­
se a rc h on small b u sin e ss t o p ic s only i f th e f a c u l t y were given r e l e a s e
tim e f o r th o s e r e s e a r c h p r o j e c t s .
Most o f th e deans d id n o t view th e SBI program as a c a t a l y s t
f o r g e n e r a tin g r e s e a r c h I n t e r e s t in small b u s in e s s (Q uestion 2 0 ).

Five

(38.4%) s a id t h a t th e SBI program d id n o t pro vide r e s e a r c h o p p o r t u n i t i e s
f o r s tu d e n t s , and s i x (46.1%) s a id t h a t th e program d id n o t g e n e ra te
r e s e a r c h o p p o r t u n i t i e s f o r f a c u l t y members.

Two o f th e s e deans

q u a l i f i e d t h e i r s ta te m e n ts by p o in tin g o u t t h a t many o f th e SBI p r o j e c t s
do in v o lv e m arketing survey s t u d i e s , b u t th ey regarded t h i s a c t i v i t y to
be an a s p e c t o f c o n s u ltin g r a t h e r than r e s e a r c h .

Two deans (15.3%)

i n d i c a t e d t h a t th e SBI program d id c r e a t e r e s e a r c h o p p o r tu n i t i e s f o r
t h e i r s t u d e n t s , and one (7.6%) s a id t h a t th e program provided o c casio n al
a p p lie d r e s e a r c h o p p o r tu n i t i e s f o r th o s e f a c u l t y members in v o lv ed in
th e SBI program.

One dean ex p re sse d puzzlement as t o how o r why an

SBI program would p ro v id e e i t h e r s tu d e n ts o r f a c u l t y members w ith
o p p o r t u n i t i e s to do r e s e a r c h on small b u s in e s s t o p i c s .
Seven b u s in e s s deans (53.8%) ex p ressed th e view t h a t th e b e s t
approach f o r s y s te m a t i c a l l y g e n e r a tin g more r e s e a r c h on small b u s in e s s e s
would be to e s t a b l i s h and fund a small b u s in e s s r e s e a r c h c e n t e r
(Q uestion 2 1 ).

T his c e n t e r would perform v a rio u s f u n c tio n s i n c lu d in g :

i d e n t i f y i n g t o p i c s which needed to be r e s e a r c h e d , s o l i c i t i n g r e s e a r c h
p ro p o sa ls from f a c u l t y members, p ro v id in g r e s e a r c h g r a n t s , and pub­
l i s h i n g th e f i n a l re s e a rc h p ro d u c t.

One dean sug gested t h a t t h e b u s i­

n ess c o lle g e s could s o l i c i t th e r e s e a r c h p r o j e c t s , charge th e f e e s ,
and p a rc e l o u t r e s e a r c h p r o j e c t s t o f a c u l t y members as a p a r t o f t h e i r

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p u b lic s e r v ic e r e s p o n s i b i l i t i e s .
in clu d ed :

Other f a c i l i t a t i n g f a c t o r s mentioned

(1) c l e a r l y d e f in in g a r e s e a r c h agenda; (2) i d e n t i f y i n g

re s e a rc h to p i c s t h a t would le a d t o re s e a rc h f in d in g s t h a t would be
p u b lis h a b le ; (3) g iv in g f a c u l t y members r e l e a s e tim e o r making small
b u sin e ss r e s e a r c h a p a r t o f t h e i r c o n tr a c tu a l assig n m en ts; and (4) i n ­
vo lving r e p r e s e n t a t i v e s from th e small b u s in e s s community along w ith a
group o f f a c u l t y members t h a t would j o i n t l y e s t a b l i s h some re s e a rc h
g o a ls .
Concern 3 - The P o t e n t i a l f o r I n t e g r a t i n g th e Small Business
A s s is ta n c e Program w ith th e S e rv ic e A c t i v i t i e s o f th e
Business C o lleg es/S ch o o ls
In d is c u s s in g i n s t i t u t i o n a l p o l i c i e s governing p r i v a t e c o n s u lt ­
ing a c t i v i t i e s o f f a c u l t y members, nine (69.2%) o f th e b u sin ess deans
i n d ic a te d t h a t t h e i r c o lle g e d id have formal p o l i c i e s l i m i t i n g th e
amount o f time t h e i r f a c u l t y members could spend in t h i s way (Q uestion
22 ).

Four deans (30.7%) s a i d t h e i r c o lle g e had no formal p o lic y

governing t h i s .

Six o f th e c o lle g e s l im ite d t h i s a c t i v i t y t o one day

p e r week; two c o lle g e s li m i t e d t h i s a c t i v i t y to two days p e r month; and
one c o ll e g e li m it e d t h i s a c t i v i t y to one day p er month.

One o b s e rv a tio n

which was r e p e a te d ly v o lu n te e r e d , was t h a t th e p o lic y which r e s t r i c t e d
th e f a c u l t y members' tim e d id not in c lu d e weekends, and f a c u l t y members
were f r e e t o use t h a t time as th ey w ished.

Another f r e q u e n t comment

made was t h a t , i n f o r m a l ly , t h e r e was no l i m i t imposed upon a f a c u l t y
member as long as h is o r h e r p r i v a t e c o n s u ltin g a c t i v i t i e s were n o t
i n t e r f e r i n g w ith h is o r h e r te a c h in g and o t h e r r e s p o n s i b l i t i e s .

Two

b u s in e s s deans p o in te d o u t t h a t th e union c o n t r a c t s a t t h e i r i n s t i t u t i o n

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s p e c i f i e d t h a t once f a c u l t y members f u l f i l l e d t h e i r c o n t r a c t u a l o b l i ­
g a tio n s they were f r e e to spend t h e i r tim e as th ey saw f i t .
Eleven deans (84.6%) i n d i c a t e d t h a t f a c u l t y members were r e ­
q u ire d to r e p o r t a l l o f t h e i r p r i v a t e c o n s u ltin g a c t i v i t i e s to t h e i r
departm ent chairman (Q uestion 2 3 ).

Only t h r e e deans (23%) s t a t e d t h a t

f a c u l t y members were n o t r e q u ire d to r e p o r t t h i s typ e o f in fo rm a tio n .
S ix o f th e b u sin e ss deans e s tim a te d t h a t between 30 to 50
p e rc e n t o f t h e i r f a c u l t y members were in vo lved in p ro v id in g c o n s u ltin g
s e r v ic e s t o small b u s in e s s firm s (Q uestion 2 4 ).

Four deans e s tim a te d

t h a t 1 t o 20 p e rc e n t o f t h e i r f a c u l t y were c o n s u ltin g small b u s in e s s e s ;
two deans e s tim a te d between 50 and 60 p e r c e n t o f t h e i r f a c u l t y members
were c o n s u ltin g small b u s in e s s e s ; and only one dean th o u g h t t h a t a l l o f
h is f a c u l t y members provided some c o n s u ltin g s e r v i c e s to small b u s i ­
n esses from time t o tim e.
When asked ab ou t th e a b i l i t y o f small b u s in e s s e s to pay f a c u l t y
c o n s u ltin g f e e s , e i g h t deans (61.5%) f e l t t h a t f a c u l t y fe e s were
probably to o high f o r th e "average" small b u sin e ssp e rso n to a f f o r d
(Q uestion 25 ).
re g a rd .

Several q u a l i f y i n g o b s e rv a tio n s were o f f e r e d in t h i s

One dean s t a t e d t h a t f a c u l t y members w i l l do p r o j e c t s below

market c o s ts i f they have a s tr o n g p erso n al i n t e r e s t in th e p r o j e c t
to p ic .

Another dean ex pressed th e op inio n t h a t in many c ases small

b u s in e s s e s can a f f o r d f a c u l t y c o n s u ltin g r a t e s b u t sim ply d o n 't b e lie v e
t h a t th e b e n e f i t s w i l l outweigh th e c o s t s .

S t i l l a n o th e r dean ex­

p re ss e d th e view t h a t i f f a c u l t y members were t o lower t h e i r f e e s ,
t h e r e would probably be a co rresp o n d in g assum ption made on th e p a r t o f
b u s in e ssp e rso n s t h a t t h e i r c o n s u ltin g s e r v i c e s w e r e n 't any good.

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Five deans (38.4%) ex pressed th e view t h a t f a c u l t y c o n s u ltin g
f e e s were n o t too high f o r th e average small b u s in e s s person t o a f f o r d .
According to one d ean , h i s f a c u l t y members r e a l i z e d t h a t th e y could
p r i c e them selves o u t o f th e m ark et, an d , 1n t h a t p a r t i c u l a r r e g io n ,
most c o n s u ltin g o p p o r t u n i t i e s came from small b u s in e s s f ir m s .

Another

dean I n d ic a te d t h a t th e answer t o th e q u e s tio n depended upon how o f te n
th e small b u s in e s s needed a c o n s u lta n t .

In h i s view, th e average

small b u s in e s s could probably a f f o r d to use f a c u l t y c o n s u lt a n t s i f
th e frequency w e r e n 't to o g r e a t .
All o f th e deans i d e n t i f i e d one o r more ty p es o f in c e n tiv e s
t h a t could be in tro d u c e d t o encourage f a c u l t y members t o p ro v id e con­
s u l t i n g a s s i s t a n c e to small b u s in e s s e s which o th e rw ise could not
a f f o r d t h e i r s e r v ic e s (Q uestion 26).

The most common form o f in c e n ­

t i v e recommended by s i x deans (46.1%) was t h a t o f p ro v id in g monetary
com pensation.

The second most common s u g g e s tio n o f f e r e d by f i v e

deans (38.4%) was t h a t th e p u b lic s e r v i c e c a te g o ry could be given
g r e a t e r p r i o r i t y by th e c o lle g e in e v a l u a t i n g f a c u l t y members f o r
promotion and te n u r e .

O ther s u g g e stio n s in c lu d e d :

(1) g r a n tin g

f a c u l t y members r e l e a s e tim e f o r such p r o j e c t s , and (2) s e t t i n g up
c o n s u ltin g o p p o r tu n i t i e s t h a t would y i e l d d a ta f o r p u b lis h a b le
research.

At th e same tim e , f o u r deans ex p ressed doubts t h a t t h e i r

s u g g e s tio n s could be implemented.
were:

The reaso n s given f o r th o s e doubts

(1) union c o n t r a c t s would make t h i s im p o s s ib le ; (2) p ro v id in g

monetary compensation would depend e n t i r e l y upon th e u n i v e r s i t y being
given th e money to do t h i s w ith ; and (3) due to th e i n c r e a s i n g
im portance o f r e s e a r c h and th e need f o r i n s t i t u t i o n s to a t t r a c t

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o u ts i d e money* th e p u b lic s e r v i c e c a te g o ry would probably c o n tin u e t o
rank low 1n e v a l u a t i n g f a c u l t y .

One o t h e r in n o v a tiv e method f o r s e c u r ­

ing low c o s t c o n s u lt in g a s s i s t a n c e f o r small b u s in e s s e s by s e t t i n g up
an arrangem ent o u t s i d e o f th e f a c u l t y i n c e n t i v e system was recommended:
S e t up a Small B usiness Development Center* s t r i k e a very
nominal wage* and ask people t o work f o r t h a t . You w ill
g e t th e McCrakens, th e D a n ie ls o n s, th e Horowitzes and
o t h e r big names to work f o r $35 o r $50 an hour - o r
w hatever i t 1 s . I would g iv e you f i v e days o f my tim e ,
and I could convince some o t h e r big names in th e s t a t e
t o g iv e you X number o f days o f t h e i r tim e t o be used
w i s e ly , a t yo u r d i s c r e t i o n , f o r a nominal f e e . You, th e n ,
would s e l l th o s e d a y s, and you would g u a ra n te e th e work.
Concern 4 - The Type o f Small B usiness A s s is ta n c e Program
Model T hat Would Be Most E f f e c t i v e in U t i l i z i n g
C o lleg e and U n iv e r s ity Resources
A small b u s in e s s a s s i s t a n c e program s e t up in th e p r i v a t e s e c t o r
and working c l o s e l y w ith th e p u b lic c o lle g e s and u n i v e r s i t i e s was viewed
as being th e most e f f e c t i v e approach t o fo llo w in d e sig n in g a program
acco rd in g to s i x (46.1%) o f th e b u s in e s s deans (Q uestion 2 7 ).

Five

deans (38.4%) f e l t t h a t such a program would be more e f f e c t i v e i f i t
were based in and o p e ra te d by t h e c o lle g e s and u n i v e r s i t i e s .

Two deans

(15.3%) had no c l e a r p r e f e r e n c e .
Those s u p p o rtin g th e co n cep t o f a program based in th e p r i v a t e
s e c t o r gave a v a r i e t y o f reaso n s t o s u p p o rt t h e i r views:
I d o n 't know o f any small b u s in e s s a s s i s t a n c e program t h a t
1s u n i v e r s i t y based. P a r t o f th e problem i s , I d o n 't th in k
th e u n i v e r s i t y has th e a b i l i t y t o c o o r d in a te a l l th e work
t h a t would be n e c e s sa ry t o o p e r a te such a program e f f e c t i v e l y .
A ls o , small b u s in e s s e s a r e l e a r y o f th e u n i v e r s i t y , so t h e r e
i s a p e rc e p tu a l p r o b le m ....A p r i v a t e s e c t o r based program
would be f r e e o f p o l i t i c a l fund ing problems because i t
would be su p p o rted p r i v a t e l y .

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I th in k th e p r i v a t e s e c t o r based model would work. Uni­
v e r s i t i e s a r e n o t w e ll-d e s ig n e d to s o lv e in d iv id u a l prob­
lems; they a r e designed t o s o lv e c l a s s e s o f problems.
The whole q u e s tio n o f s t a r t i n g new e n t e r p r i s e s i s a
w orthw hile i n t e l l e c t u a l a c t i v i t y . But h e lp in g in d iv id u a l
"X" s t a r t up i s n o t where our e x p e r t i s e l i e s .
To a c e r t a i n e x t e n t , th e SBDCs r e p r e s e n t a roundabout way
o f g e t t i n g government money in through th e u n i v e r s i t y t o
h elp th e small b u s in e s s p erso n . I f I know an y th in g about
th e way u n i v e r s i t i e s work, a f t e r te n y e a r s in one, a l o t
o f funds w i l l be lopped o f f to pay f o r s e c r e t a r i e s and
o th e r overhead.
The SBDC program i s r e m in is c e n t o f th e S t a t e Technical
S e rv ic e s Program o f a few y e a r s ago. T hat approach d id
n o t in v o lv e enough in p u t from th e b u s in e s s community.
I t was to o much c o n t r o l l e d and d i r e c t e d by i n d i v i d u a l s
in th e u n i v e r s i t i e s and was to o wrapped up in what was
good f o r th e i n s t i t u t i o n s .
I would th in k a f r e e s ta n d in g o f f i c e could have p r e t t y
good su ccess i f th e small b u s in e s s firm s knew ab ou t i t
and reco g n ized i t as a p la c e where th ey could g e t answers
t o t h e i r problems. I t would ta k e a l o t o f c o n t a c t w ith
b u s in e s s firm s t o l e t them know what could be done.
On th e o t h e r hand, th o s e deans s u p p o rtin g th e con cep t o f a
program based 1n th e

u n i v e r s i t i e s gave reaso n s such as th e fo llo w in g

t o s u p p o rt t h e i r views:
The problem I see w ith th e p r i v a t e s e c t o r approach i s (1)
having a s ta te w id e d e l i v e r y system . I t would be lo c a te d
n e a r th e c e n t e r o f p o p u la tio n in th e s t a t e and would n o t
be l i k e l y t o d e l i v e r s e r v ic e s t o th e o u t l y i n g a r e a s o f
th e s t a t e ; and (2) I d o n 't th in k th e reward t o th e u n iv e r ­
s i t i e s would be s u f f i c i e n t t o make i t a r e a l v i a b l e pro­
gram.
P ro p e rly ch an n eled , c o l l e g e s and u n i v e r s i t i e s have a l o t
o f t a l e n t t h a t could be u t i l i z e d . I d o n 't t h in k an o p e ra ­
t i o n based in th e p r i v a t e s e c t o r could p r o p e r ly m o b iliz e
th a t ta le n t.
I f i t were s e t up in th e p r i v a t e s e c t o r , i t would be
l i m it e d in i t s a b i l i t y t o a ccess u n i v e r s i t y r e s o u r c e s .
When we a r e i n t e r a c t i n g w ith a p r i v a t e s e c t o r o r g a n i z a t i o n ,
i t u s u a lly In vo lves a fe e o f some s o r t f o r th e i n t e r ­
change o f in fo r m a tio n . Whereas, when we a r e i n t e r a c t i n g

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w ith a p u b lic agency, such as th e Michigan O f fic e o f
Economic Development, we a r e a l l p u b lic s u p p o rte d , o u t
o f s t a t e o r general f u n d s , and th e in te rc h a n g e o f I n ­
form ation i s f a i r l y open. We both s e r v i c e th e p r i v a t e
s e c t o r . But th e id e a o f using someone in th e p r i v a t e
s e c t o r to i n t e r a c t w ith us t o s e rv e someone e l s e 1n th e
p r i v a t e s e c t o r , I guess would be a new ex p e rie n c e f o r
us.
I would t h i n k , i f f o r no o th e r reason th an c o s t - s a v i n g s ,
we would use th e e x i s t i n g i n s t i t u t i o n s . R ather than
s e t t i n g up a n o th e r o f f i c e , th e s t a t e should make use o f
h ig h e r e d u c a tio n r e s o u r c e s .
We a re in v o lv ed w ith th e Small Business A d m in istra tio n
h ere - we sponsor an SBI program. We a r e aware o f th e
SBDC p i l o t program s, and we would l i k e t o be a b le to
expand our s e r v i c e r o l e in t h i s community. I th in k a
u n iv e r s ity - b a s e d SBDC would g iv e us a good v e h ic le f o r
doing t h a t .
One o f t h e deans who did n o t ex p ress a c l e a r p r e fe r e n c e ex­
p la in e d h is views as fo llo w s :
I see some r e a l d i f f i c u l t i e s e i t h e r way. The reason I
see d i f f i c u l t i e s e i t h e r way 1s because what you a r e
t r y i n g to do i s t o f i n d a commitment from people who a r e
a lr e a d y overcommitted. And n e i t h e r way i s going to s o lv e
t h a t b a s ic problem. You w i l l be a b le t o f in d p eople from
th e p r i v a t e s e c t o r who may have th e e x p e r t i s e and commit­
ment t o small b u s in e s s . I f you go th e p r i v a t e way, you
have two ways o f s t a f f i n g th e needed e x p e r t i s e : e x te r n a l
to th e u n i v e r s i t i e s and i n t e r n a l to th e u n i v e r s i t i e s .
That may b e , a t t h i s p o in t i n tim e , an advantage t o you,
because 1 f you have t o r e l y t o t a l l y on th e u n i v e r s i t y because o f what we d e s c rib e d as th e p r e s e n t swamping o f
our b o a t (demand exceeding sup ply) - i t ' s j u s t n o t t h e r e
to be g o t , e x c e p t in th o se r a r e c ases where somebody s a y s ,
" P r o f e s s i o n a l l y , t h i s i s th e s in g l e most im p o rta n t th in g
I could be d o in g ." But t h a t ' s going t o be tough to f i n d .
While th e p r e fe r e n c e s between th e u n iv e r s it y - b a s e d approach
and th e p r i v a t e s e c t o r approach were f a i r l y ev en ly d iv i d e d , most o f th e
reason s given p e r ta in e d to th e advantages o r d isa d v a n ta g e s o f b asin g
such a program in a u n i v e r s i t y .

In summary, th o se reasons in clu d ed :

(1) th e a v a i l a b i l i t y o f a la r g e body o f t a l e n t ; (2) th e d e s i r a b i l i t y

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o f u t i l i z i n g e x i s t i n g r e s o u r c e s ; (3) th e g r e a t e r a b i l i t y o f th e u n i­
v e r s i t y t o mobilze i t s own r e s o u r c e s ; and (4) th e s ta te w id e geo graph ical
d i s t r i b u t i o n o f th e u n i v e r s i t i e s which could overcome a tendency to
skew s e r v i c e s toward th e c e n t e r o f p o p u la tio n .

The prim ary d isad v a n ­

ta g e s o f b asin g a small b u s in e s s a s s i s t a n c e program in th e u n i v e r s i t i e s
in c lu d e d :

(1) e x t e r n a l l y funded programs ten d to become absorbed and

abused by i n s t i t u t i o n a l p r i o r i t i e s ; (2) small b u s in e s s e s f e e l apprehen­
s iv e toward u n i v e r s i t i e s ; (3) r e s e a r c h o r ie n te d u n i v e r s i t i e s ten d n o t
to be o r ie n te d toward s o lv in g th e d a i l y o p e r a tin g problems o f p a r t i c u l a r
b u s in e s s e s ; and (4) th e u n i v e r s i t i e s might simply a tte m p t t o use such a
program as a budget supplem ent.
The advantages o f th e p r i v a t e s e c t o r approach which were s t a t e d
o r a llu d e d to were:

(1) small b u s in e s s e s could r e a d i l y i d e n t i f y w ith a

p r i v a t e s e c t o r o p e r a ti o n ; (2) i t would have l e s s d i f f i c u l t y keeping i t s
m issio n and p r i o r i t i e s c l e a r l y fo cu sed ; and (3) i t would be f r e e from
p o l i t i c a l funding problems because i t would be su p p o rted by f e e s and
c o n t r ib u ti o n s from th e p r i v a t e s e c t o r .

The d isa d v a n ta g e s o f th e p r i v a t e

s e c t o r based program which were i d e n t i f i e d in c lu d e d :

(1) i t would have

a l im i t e d a b i l i t y t o access u n i v e r s i t y r e s o u r c e s ; and (2) i t s s e r v i c e s
would tend t o be skewed toward th e m ajor p o p u la tio n c e n t e r s o f th e
s t a t e , th u s ig n o rin g s m a lle r and r u r a l communities.
When asked what p a r t o f t h e i r i n s t i t u t i o n s should have th e
r e s p o n s i b i l i t y f o r a d m in is te r in g a u n i v e r s i ty - b a s e d SBDC in th e e v e n t
one were e s t a b l i s h e d (Q uestion 2 8 ) , seven deans (53.8%) f e l t t h a t 1 t
should be lo c a te d in th e b u s in e s s c o l l e g e .

Four o f th e s e e x p la in e d

t h a t th ey had s e r v i c e o r ie n te d u n i t s , e . g . management c e n t e r s , w ith in

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t h e i r c o l l e g e t h a t would p ro v id e an a p p r o p r i a t e o r g a n i z a ti o n a l f o c u s .
Four deans (30.7%) f e l t t h a t th e SBDC would more a p p r o p r i a t e l y be
lo c a te d in t h e d i v i s i o n o f c o n tin u in g e d u c a tio n because i t was a lr e a d y
s t a f f e d t o perform th e i n t r a l n s t l t u t i o n a l and o f f campus f u n c tio n s
t h a t would be r e q u i r e d o f an SBDC.

Two deans recommended o t h e r

l o c a t i o n s w ith in t h e i r I n s t i t u t i o n s , both o f which would e n a b le th e
c e n t e r t o have as much i n t r a i n s t i t u t i o n a l v i s i b i l i t y and s u p p o rt as
p o ssib le.
Concern 5 - The Types o f Small B u sin esses T hat Should Receive A s s is ta n c e
E ig h t o f t h e b u s in e s s deans (61.5%) f e l t t h a t a small b u s in e s s
a s s i s t a n c e program should be t a r g e t e d t o a s s i s t p a r t i c u l a r segments o f
th e small b u s in e s s s e c t o r (Q uestion 2 9 ).

Five deans (38.4%) f e l t t h a t

th e program should be open-ended and t h a t a s s i s t a n c e should be p ro v id e d ,
t o th e e x t e n t p o s s i b l e , t o any small b u s in e s s t h a t approached t h e c e n t e r
fo r a s sis ta n c e .
Among th o s e who f e l t t h a t th e program sh o u ld be t a r g e t e d ,
t h r e e recommended t h a t th e Michigan Department o f Commerce sh ould
I d e n t i f y g o a ls t h a t r e f l e c t th e economic development needs o f th e
s t a t e , and th e economic development needs o f th e re g io n in which th e
SBDC would be l o c a t e d , and d ev elop perform ance c o n t r a c t s t h a t would
focu s on th o s e n eeds.

Four o t h e r deans agreed w ith t h a t approach b u t

added t h a t th e p r i v a t e s e c t o r in t h e i r re g io n s sh ou ld be a c t i v e l y
in v o lv ed In th e p ro c e ss o f d e f i n in g th e economic development needs t o
be ad d re sse d by th e c e n t e r .

One dean c a u tio n e d t h a t w h ile th e program

should have a t a r g e t e d economic development s t r a t e g y , i t should be a

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fle x ib le stra te g y .

He e x p la in e d t h a t th e needs o f th e economy a r e

c o n s ta n tly ch anging, and t h a t i t would be u s e le s s t o pursue g o als
t h a t were n o t tim e ly in th e sen se t h a t th e b u s in e s s s e c t o r being
served d i d n ' t p e r c e iv e th e v alu e o f th e a s s i s t a n c e being o f f e r e d .
For example, a t th e p r e s e n t tim e c e r t a i n segments o f th e small b u s i ­
ness s e c t o r s tr o n g l y p e rc e iv e th e need to e l im i n a t e t h e i r dependence
upon th e autom obile i n d u s t r y .

They would be more r e c e p t i v e to a

program designed t o h elp them a t t a i n t h a t goal a t th e p r e s e n t tim e ,
however, than th e y would have been t h r e e y e a r s ago.
Another dean f e l t t h a t th e program should have a ta r g e te d
a s s i s t a n c e ap pro ach, b u t t h i s would not mean t h a t th e program could
n o t a l s o be open-ended.

He e x p la in e d :

These approaches a r e n o t m u tu ally e x c lu s iv e . The small
b u s in e ssp e rso n who needs h elp should be a b le t o come to
th e SBDC. At th e same tim e , t h e r e a r e some needs 1n th e
lo c a l a r e a t h a t need t o be determ ined and p r i o r i t i z e d .
For example, in t h i s a r e a we need a general upgrading
in th e to u rism i n d u s t r y . I t ' s a very c o m p e titiv e in d u s­
t r y . Our to u ris m has gone down. We d o n 't do a very
good jo b in my e s tim a t io n . We could use t r a i n i n g p ro ­
grams f o r people in th e t o u r i s t b u s in e s s , t h e i r employees,
gas s t a t i o n a t t e n d a n t s , e t c .
S t i l l a n o th e r d ean , who f e l t th e program should be t a r g e t e d in
some way, c a u tio n e d t h a t th e program should be f l e x i b l e :
From a p u re ly t h e o r e t i c a l p o i n t o f view , you would
o b v io u sly d ecid e ahead o f tim e who you were s e r v i n g ,
b u t in r e a l i t y you may be r e s t r i c t i n g y o u r s e l f r i g h t
o u t o f b u s in e s s . You may want t o s t a r t open-ended
and th en p r i o r i t i z e . I f you p r i o r i t i z e to o soon, you
may c u t o u t some needy m ark ets.
Among th o s e who f e l t th e program should be open-ended, th r e e
f e l t t h a t i t would be to o p o l i t i c a l l y awkward t o exclude anyone from
th e program.

One dean f e l t t h a t i t would be s u f f i c i e n t t o d e l i n e a t e

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th e e l i g i b l e c l i e n t e l e by l i m i t i n g s e r v ic e s t o a given geo grap hical
area.

Another dean ex p ressed r e s e r v a t i o n s about being a b le t o de­

term ine what kinds o f b u s in e s s e s 1n h i s a r e a needed p r i o r i t y a s s i s ­
ta n c e .
Five b u sin e ss deans (38.4%) f e l t t h a t e x i s t i n g b u s in e s s e s
should r e c e iv e th e h i g h e s t p r i o r i t y , t h r e e (23%) f e l t t h a t new b u s i ­
n esses w ith high growth p o t e n t i a l should r e c e iv e h i g h e s t p r i o r i t y , and
f i v e (38.4%) d id n o t e x p re ss any op inio n on t h i s s u b j e c t (Question 30 ).
Of th o se deans who th o u g h t th e program should focus on e x i s t i n g
b u s in e s s e s , two s p e c i f i e d t h a t th ey meant e x i s t i n g b u s in e s s e s t h a t a r e
s u f f i c i e n t l y complex in term s o f s t a f f i n g :
I would g iv e h ig h e r p r i o r i t y t o t h e l a r g e r small b u s i n e s s e s . . .
th o se t h a t a r e l a r g e enough t o have f o u r o r f i v e r e s p o n s i b i l i ­
t i e s going on w ith p eople heading th o se up. T h i s , as opposed
to th e one-man o p e r a tio n where th e owner 1s th e b o s s , and he
knows e v e ry th in g t h a t i s happening. And h i s acco un ting
system i s h i s checkbook w ith very sk etc h y r e c o r d s . When you
g e t a l i t t l e l a r g e r than t h a t , where th e boss c a n ' t p e r s o n a lly
s u p e r v i s e , t h i s i s where t h e small b u s in e s s p e rs o n g e ts in t o
problems. He d o e s n 't know what kind o f p eople t o h i r e ; he
d o e s n 't know, r e a l l y , what he n eed s. This 1s where some
coursework and sem inars and c o n s u l t a t i o n would h elp him f i g u r e
o u t ways to do what he needs t o do.
The more you have b u s in e s s p eople who a r e w e ll-e d u c a te d o r
have back-up s t a f f s w ith some degree o f s p e c i a l i z a t i o n , th e
g r e a t e r y o u r chance i s o f p ro v id in g s u c c e s s f u l a s s i s t a n c e .
I f t h a t back-up s t a f f o r e x p e r t i s e d o e s n 't e x i s t , I n s te a d o f
coming i n , a n a ly z in g , and p ro v id in g t h e kind o f c o n s u ltin g
guidance and e x p e r t i s e y o u 'v e agreed t o do and then being
a b le to withdraw y o u r s e l f and go on t o t h e n e x t c a s e , you
g e t tra p p ed because you g e t i n t o th e im plem entation s id e when
th e y s a y , "What d id you say? I'm n o t s u r e how t o do t h i s .
I s t h i s r i g h t ? " . . . a n d y o u ’r e back w ith them ag ain and a g a in .
P r e t t y soon you a r e fo rc e d to announce t o them t h a t y o u r jo b
1s t o p ro v id e th e i n f o r m a tio n , n o t t o c a r r y i t o u t . They
have g o t to be a b le t o implement i t on t h e i r own. They c a n ' t
keep coming back f o r th e h a n d -h o ld in g , because i f th ey do,
th e y a b s o lu t e l y consume y o u , and you have nowhere t o go.

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Two deans f e l t t h a t e x i s t i n g b u s in e s s e s which a r e d e c l i n in g due
to a s h i f t In m arket p o t e n t i a l should be given p r i o r i t y a s s i s t a n c e .
For example, th e foundry I n d u s tr y in Michigan m ight be n e a rin g a s t a t e
o f o b solescen ce and w ith p ro p er guidance could be helped to r e to o l
and be r e d i r e c t e d I n to new m arket a r e a s .
One dean ex p ressed th e view t h a t e x i s t i n g m anufacturing firm s
should r e c e iv e high p r i o r i t y a s s i s t a n c e - p a r t i c u l a r l y th o se manufac­
t u r i n g firm s t h a t would be e x p o r tin g p ro d u cts o u t s i d e th e s t a t e o r th e
lo c a l reg io n and would, th e r e b y , be c o n t r i b u t i n g s u b s t a n t i a l l y to th e
growth o f th e lo c a l economic base.
Three deans f e l t t h a t th e program should p la c e a h ig h e r p r i o r i t y
on developing new b u s in e s s e s r a t h e r than h e lp in g e x i s t i n g b u s in e s s e s .
Two deans e l a b o r a te d on t h i s view:
I th in k we a r e r e a l l y t a l k i n g ab ou t t h e person who has an
i d e a , o r e x p e rie n c e in a f i e l d , who b e lie v e s t h e r e i s a
m arket n o t being serv ed - a n ich e between th e d i v i s i o n s
o f a la r g e c o r p o r a t i o n . . . . I b e li e v e t h e r e a r e a l a r g e
number o f people o f t h i s s o r t . Some o f them need t r a i n i n g .
Some need f i n a n c i a l backing. T h e r e 's a com bination o f
t h i n g s . You r e a l l y ought to be h e lp in g people who have
an i d e a . The SBDC could p rov id e a c o n tin u in g commitment
to help th e s e people and to s e rv e as a f a c i l i t a t o r in
a d v is in g them as t o what t h e i r problems a r e and h e lp in g
them pursue v a rio u s avenues in s e a rc h o f s o l u t i o n s .
The focus should be on new b u s in e s s e s t h a t have th e p o ten ­
t i a l to s to p being small and g e t b ig r a p i d l y , and , th e r e b y ,
employ a l o t o f p eop le. Any program should have a very
s o p h i s t i c a t e d s c re e n in g p ro cess t h a t d o e s n 't p re te n d t h a t
everybody i s q u a l i f i e d f o r a s s i s t a n c e . The m ajor c r i t e r i a
ought t o be: what i s th e p o t e n t i a l f o r f u t u r e grow th,
f o r s a le s and f o r employment.
The b u s in e s s deans were a l s o asked t o e x p re ss any views th e y might
have on th e ty p es o f b u s in e s s e s t h a t sh ou ld r e c e i v e low p r i o r i t y
(Q uestion 31).

Four in d i c a t e d (30.7%) t h a t t h i s would in c lu d e

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b u s in e s s e s t h a t were f a i l i n g because o f poor management; two (15.3%)
i n d i c a t e d t h a t th ey would p la c e a low p r i o r i t y on "ma and pa" b u s i ­
n e s s e s ; one (7.6%) i d e n t i f i e d non-m anufacturing firm s as a low
p r i o r i t y ; and s i x (46.1%) d id n o t o f f e r any o p in io n s.
Concern 6 - The Resource Requirements and Funding Arrangements
f o r I n i t i a t i n g a Small Business A s s is ta n c e Program
There was complete agreement among th e b u sin e ss deans t h a t a
small b u s in e s s a s s i s t a n c e program could be i n i t i a t e d w ith a very small
s t a f f (Q uestion 32).

In a d d itio n t o a program d i r e c t o r and a s e c r e t a r y ,

te n deans (76.9%) recommended t h a t th e program be s t a f f e d by one o r two
p r o f e s s i o n a l s ; one dean (7.6%) recommended a s t a f f o f t h r e e o r fo u r
p r o f e s s i o n a l s ; and two (15.3%) su gg ested t h a t th e program be s t a f f e d by
p a r t - t im e f a c u l t y s e r v i c e s .

One dean a l s o recommended t h a t in a d d itio n

to th e p r o f e s s io n a l s t a f f t h a t a d v iso ry committees made up o f r e p re s e n ­
t a t i v e s o f th e b u s in e s s community and f a c u l t y members r e p r e s e n tin g
v a rio u s a r e a s o f e x p e r t i s e be u t i l i z e d .
There was a general f e e l i n g t h a t i t would be d u p l i c a t i v e t o
h i r e a la r g e s t a f f o f p r o f e s s i o n a l s when th e c o l l e g e s ' f a c u l t i e s
a lr e a d y had th e e x p e r t i s e t o a s s i s t b u s in e s s e s .

I t was most g e n e r a lly

viewed ( e i g h t d e a n s, 61.5%) t h a t th e p r o f e s s io n a l s t a f f should be made
up o f b u s in e s s g e n e r a l i s t s who would be capable o f s c re e n in g p o t e n t i a l
b u s in e s s c l i e n t s and matching th e needs o f c l i e n t s w ith th e a p p r o p r ia te
f a c u l t y e x p e r t i s e (Q uestion 33).

Beyond t h i s , in d iv id u a l a r e a s o f

programmatic focus which were recommended in c lu d e d :
a c c o u n tin g , p r o d u c tio n , and community development.

t r a i n i n g , m ark etin g ,
Only two deans

(15.3%) had no recommendations o r d e s ir e d s t a f f e x p e r t i s e .

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Ten deans (76.9%) th o u g h t t h a t I t would be very a p p r o p r i a t e to
augment th e c o l l e g e 's c o n s u ltin g c a p a b i l i t i e s by u t i l i z i n g th e e x p e r t i s e
o f r e t i r e d b u sin e ss e x e c u tiv e s who would be w i l l i n g t o v o lu n te e r t h e i r
s e r v ic e s (Q uestion 3 4).

Two (15.3%) were n o t s u re o f t h i s approach, and

only one (7.6%) was opposed t o t h i s approach.

The g en eral consensus was

t h a t th e c e n t e r should t i e in w ith e x i s t i n g re s o u rc e s wherever they
could be found.
The id ea t h a t th e program sh ould be d esig ned t o be s e l f su p p o rtin g was su pp o rted by nine deans (69.2% ), and opposed by f iv e
(38.4%) o f th e deans (Q uestion 3 5 ).

Some deans i n d ic a t e d t h a t th e major

problem would be t h a t o f g e t t i n g th e program s t a r t e d , and t h a t w ith some
seed money th ey could produce a s e l f - s u p p o r t i n g program given enough
le a d tim e.

E stim ates o f " s u f f i c i e n t " lead tim e ranged between t h r e e

and f i v e y e a r s .

One dean f e l t t h a t th e c o n t in u a tio n o f th e program

should be dependent upon f i n a n c i a l s u p p o rt from th e b u sin e ss community
because i f th e c o n tin u a tio n depended upon s u b s t a n t i a l su p p o rt from th e
i n s t i t u t i o n , i t w o u ld n 't succeed.
Those deans t h a t opposed d e s ig n in g a s e l f - s u p p o r t i n g program
ex p re sse d th e s e r e s e r v a t i o n s :

(1) a c e n t e r might be a b le t o be p a r t l y

s e l f - s u p p o r t i n g , b u t n o t e n t i r e l y , i f i t were expected t h a t c l i e n t fe e s
would be th e so u rce o f t h a t s u p p o rt; (2) t h i s would be a program t h a t
would be p ro v id in g s e r v ic e s a t a tim e when c l i e n t s could n o t a f f o r d
th o se s e r v i c e s ; and (3) n o t a l l re g io n a l economies o f th e s t a t e would
have equal a b i l i t i e s t o s u p p o rt such a program.
Most o f th e deans ( e i g h t , 61.5%) tho ug ht t h a t th e h o s t i n s t i t u ­
t i o n s should be r e q u ire d t o p ro v id e i n s t i t u t i o n a l funds to match s t a t e
funds (Q uestion 36 ).

I t was f e l t t h a t a h o s t i n s t i t u t i o n would be more

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s e r io u s about i t s commitment to th e program i f I t s own funds were
in v o lv ed .
The deans t h a t opposed r e q u i r i n g an i n s t i t u t i o n a l match
( f i v e , 38.4%) gave th e s e re a s o n s :

(1) th e u n i v e r s i t y d o e s n 't have

money to p rov id e a match; and (2) th e u n i v e r s i t y d o e s n 't r e c e i v e
enough d i r e c t b e n e f i t from th e program t o e x p e c t i t t o p ro v id e a
match.

Each o f th e s e f iv e deans, however, d id i n d i c a t e t h a t t h e i r

i n s t i t u t i o n could probably provide an i n - k in d match o f some s o r t .
Concern 7 - The A p p ro p riate S t r u c t u r e f o r A d m in isterin g and
C o o rd in atin g a S tatew id e Program
The l a r g e s t number o f d ean s, sev en , (53.8%) i n d i c a t e d t h a t they
would p r e f e r to see a s ta te w id e o r m u l t i - c e n t e r network o f small b u s i­
ness a s s i s t a n c e c e n te r s a d m in iste re d and c o o rd in a te d by a s t a t e agency
such as th e Michigan Deparment o f Commerce's O ffic e o f Economic Develop­
ment (Question 3 7).

Two (15.3%) i d e n t i f i e d a s t a t e agency as t h e i r

second c h o ic e , and only one (7.6%) i d e n t i f i e d a s t a t e agency as th e
le a s t preferred a lte rn a tiv e .
The second l a r g e s t number o f d e a n s , t h r e e (23%), f e l t t h a t a
s i n g l e le a d I n s t i t u t i o n o f h ig h e r e d u c a tio n would be th e most p r e f e r a b l e
arrangem ent.

Two (15.3%) deans i d e n t i f i e d t h i s approach as t h e i r second

c h o ic e , and f i v e (38.4%) f e l t t h a t t h i s would be th e l e a s t s u i t a b l e
a lte rn a tiv e .
The l e a s t p o p u lar a l t e r n a t i v e was th e consortium approach.
two deans (15.3%) i d e n t i f i e d t h i s as t h e i r f i r s t c h o ic e .

Three (23%)

s e le c t e d the consortium approach as t h e i r second c h o ic e , and t h r e e
i d e n t i f i e d t h i s as th e l e a s t d e s i r a b l e a l t e r n a t i v e .

Only

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The in te rv ie w e e s were asked t o I d e n t i f y th e advantages and d i s ­
advantages f o r each o f th e s e a l t e r n a t i v e s , which many o f them did
(Q uestion 38).
S everal advantages o f a d m in is te rin g and c o o r d in a tin g a m u l t i i n s t i t u t i o n a l program through a s t a t e agency were I d e n t i f i e d .

A sta te

agency would be f r e e from th e problems a r i s i n g from i n t e r i n s t i t u t i o n a l
co m p etitio n t h a t th e u n i v e r s i t i e s ex p e rie n c e in M ichigan, and, t h e r e f o r e ,
could a c t as an o b je c t i v e bro ker 1n program p lan nin g and c o o r d in a tio n .
As an o b je c t i v e t h i r d p a r t y , a s t a t e agency could a l s o e n su re d i f f e r e n ­
t i a t i o n o f i n s t i t u t i o n a l r o l e s in p ro v id in g a s s i s t a n c e to th e small
b u s in e s s s e c t o r .

And because o f th e s t a t e ' s r e s p o n s i b i l i t y f o r s t a t e

economic developm ent, th e s t a t e would have a b e t t e r overview o f th e
s t a t e ' s needs.

F urtherm ore, i t was f e l t t h a t because th e O ffic e o f

Economic Development has d i r e c t c o n t a c t w ith th e b u sin e ss community and
has s ta te w id e v i s i b i l i t y , t h a t agency could very e a s i l y s e rv e as a
s ta te w id e r e f e r r a l c e n t e r f o r th e SBDC network.
In terms o f d isa d v a n ta g e s o f u t i l i z i n g th e s e r v i c e s o f a s t a t e
agency, i t was f e l t by some t h a t t h i s would sim ply p rov id e a n o th e r
o p p o r tu n ity f o r s t a t e b ureaucracy to expand.

There was some co n cern ,

t o o , t h a t a non-academic agency would n o t u n d erstan d th e environm ent o f
academic a d m i n i s t r a t o r s , and t h a t t h i s could le a d t o f r u s t r a t i o n s and
m isu n d erstan d in g s in program c o o r d in a tio n a c t i v i t i e s .

F urtherm ore,

t h e r e was some concern t h a t th e c o n t i n u i t y o f funding could n o t be
guaranteed because t h a t was th e n a tu r e o f p u b lic fu nd ing .
Various advantages t o having a s i n g l e h ig h e r e d u c a tio n i n s t i t u ­
t i o n s e rv e as th e le a d agency were p e rc e iv e d .

I t could e s t a b l i s h

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c l e a r v i s i b i l i t y th ro ug ho ut th e s t a t e as th e p la c e small b u s in e s s e s
could tu rn to f o r a s s i s t a n c e .

A d m i n i s t r a t i v e ly , t h i s approach would

p e rm it r e s p o n s i b i l i t y f o r a d m in is te r in g th e program t o be c l e a r l y
e sta b lish e d .

Academic a d m i n i s t r a t o r s would be r e l a t i n g t o academic

ad m in istrato rs.

And, assuming t h a t one o f th e l a r g e r i n s t i t u t i o n s

serv ed as t h e lead agency, t h i s would b rin g a l a r g e number o f re s o u rc e s
i n t o th e program a t th e o u t s e t .
There were d isa d v a n ta g e s t h a t were p e rc e iv e d a l s o , i f a s in g l e
h ig h e r ed u catio n i n s t i t u t i o n were t o s e rv e as th e lead agency.

The

le a d i n s t i t u t i o n would be 1n a p o s it i o n to dominate th e program and th e
a l l o c a t i o n o f funds.

The f a c t t h a t no one i n s t i t u t i o n had, t o d a t e ,

e s t a b l i s h e d i t s e l f as a le a d e r in th e a r e a o f small b u s in e s s knowledge
a n d /o r a s s i s t a n c e would undermine any one i n s t i t u t i o n ' s l e a d e r s h ip
c r e d i b i l i t y w ith th e o t h e r i n s t i t u t i o n s .

The le a d

i n s t i t u t i o n would

be fa ced w ith th e t a s k o f e s t a b l i s h i n g working r e l a t i o n s h i p s among
i n s t i t u t i o n s which normally m ain tain c o m p e titiv e r e l a t i o n s h i p s .

And

t h i s approach would r e q u i r e t h a t one i n s t i t u t i o n be w i l l i n g to assume
a new, major a d m i n i s t r a t i v e r e s p o n s i b i l i t y .
The only advantages t h a t were i d e n t i f i e d f o r th e consortium
approach were (1) t h a t i n s t i t u t i o n a l re s o u rc e s could be h arn essed by
common g o als and o b j e c t i v e s , and (2) t h a t i n s t i t u t i o n s could determ ine
t h e i r own s p e c i a l i z e d r o l e s and e s t a b l i s h a sim ple o r g a n iz a tio n a l
mechanism f o r r e f e r r i n g c l i e n t s t o t h e a p p r o p r i a t e i n s t i t u t i o n .
In terms o f d is a d v a n ta g e s , i t was f e l t t h a t th e i n s t i t u t i o n s
were to o c o m p e titiv e and t h a t too much i n - f i g h t i n g would ta k e p la c e
under a consortium arrangem ent.

I n t e g r a t i n g i n s t i t u t i o n a l re s o u rc e s

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would be d i f f i c u l t t o accom plish, and th e consortium would be to o
d i f f i c u l t to a d m in is te r .

And even th e con so rtium approach would r e ­

q u ir e th e le a d i n i t i a t i v e o f one o f th e l a r g e r i n s t i t u t i o n s which
might o r might n o t be forthcom ing.

In s h o r t , t h e r e was very l i t t l e

s u p p o rt f o r th e consortium approach.
Summary
In t h i s c h a p t e r , th e r e s u l t s o f th e r e s e a r c h have been r e p o r te d .
The major f in d in g s were summarized in o r d e r 1n which th e concerns were
p re s e n te d .
In th e a r e a o f concern d e a lin g w ith th e p o t e n t i a l f o r i n t e g r a t i n g
a u n iv e r s ity - b a s e d small b u sin ess a s s i s t a n c e program w ith th e i n s t r u c ­
t i o n a l program i t was found t h a t a l l b u t two o f th e b u s in e s s c o lle g e s
in clu d ed in t h i s stu d y o f f e r e d small b u s in e s s o r i e n t e d c o u r s e s .

Most

o f th o se c o ll e g e s o f f e r e d only one c o u r s e , and no c o lle g e o f f e r e d more
than t h r e e c o u rs e s .

Most o f th e g ra d u a te le v e l co u rse s were focused

on e n t r e p r e n e u r s h ip w h ile most o f th e un d erg rad u ate co u rse s were focused
on small b u s in e s s management t o p i c s .

Only two deans i n d i c a t e d t h a t new

small b u s in e s s co u rses were being planned f o r f u t u r e i n t r o d u c t i o n .

S tu ­

d en ts could e l e c t t o major in small b u s in e s s a t two o f th e c o lle g e s and
two o t h e r c o lle g e s were in th e p ro cess o f develo pin g a s p e c i a l i z e d
o p tio n in small b u s in e s s .
A m a jo rity o f th e b u s in e s s c o l l e g e s were in v olv ed in p ro v id in g
l i f e - l o n g l e a r n in g sem inars and workshops f o r sm all b u s in e s s e s .

Those

programs were being ta u g h t by f a c u l t y members and a d ju n c t f a c u l t y both
on campus and o f f campus.
of a c tiv ity .

Five c o lle g e s were n o t engaged in t h i s ty p e

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Almost a l l o f th e c o lle g e s o f f e r e d s e r v i c e - l e a r n i n g programs
such as i n t e r n s h i p s and c o o p e ra tiv e ed u catio n programs which p u t many
o f t h e i r s tu d e n ts i n t o d i r e c t c o n ta c t w ith small b u s in e s s e s .

T h is,

however, was a s i d e - e f f e c t r a t h e r than an In tend ed r e s u l t .
Seven o f th e b u s in e s s c o l l e g e s sponsored an SBI program through
which s tu d e n ts provided c o n s u ltin g a s s i s t a n c e t o small b u s in e s s e s .
V i r t u a l l y a l l o f th e deans saw t h i s program as being h ig h ly b e n e f i c i a l
f o r t h e i r s t u d e n t s , and a l l b u t one I n d ic a te d t h a t th ey would be con­
t i n u i n g t h i s program i n d e f i n i t e l y .
In th e a r e a o f f a c u l t y r e s e a r c h a c t i v i t i e s , 1 t was found t h a t
a l i t t l e over o n e - h a l f o f th e b u s in e s s c o lle g e f a c u l t i e s had a t l e a s t
one person who co n s id e re d small b u s in e s s to be h i s o r h er a re a o f
research i n t e r e s t .

Various reaso ns t h a t would accou nt f o r th e r e l a ­

t i v e l y few number o f f a c u l t y members whose r e s e a r c h i n t e r e s t la y in
t h i s a r e a were i d e n t i f i e d .

P r im a r ily i t was f e l t t h a t small b u sin e ss

was n o t a d i s c i p l i n e o r a s u b d i s c i p l i n e in th e formal sense o f th o se
words, and t h a t b u s in e s s c o lle g e s had t r a d i t i o n a l l y been o r ie n te d
toward l a r g e r b u s in e s s fir m s .
Most b u s in e s s deans d id n o t th in k t h a t t h e i r SBI program served
to s t i m u l a t e r e s e a r c h on small b u s in e s s problems - e x cep t f o r a p p lie d
m arketing s tu d i e s f o r e i t h e r s tu d e n t s o r f a c u l t y members.
There was g en eral agreement t h a t th e most e f f e c t i v e way to
engage a l a r g e r number o f b u s in e s s c o l l e g e f a c u l t y members in conducting
r e s e a r c h on small b u s in e s s problems would be to e s t a b l i s h and fund a
r e s e a r c h c e n t e r which would s o l i c i t p ro p o sa ls and p ro v id e r e s e a r c h
g ra n ts.

94

Most i n s t i t u t i o n s have formal p o l i c i e s l i m i t i n g th e number of
working hours t h a t a f a c u l t y member can spend in p r i v a t e c o n s u ltin g
a c tiv itie s.

However, th e r u l e o f thumb e x p la in e d was t h a t f a c u l t y

members were encouraged to engage 1n p r i v a t e c o n s u ltin g a c t i v i t i e s
to w hatever e x t e n t he o r she could handle w ith o u t having i t a d v e rs e ly
a f f e c t h i s o r h e r o th e r c o n tr a c tu a l d u t i e s .
All o f th e deans were c e r t a i n t h a t t h e i r f a c u l t y members, to
varyin g d e g r e e s , were p ro v id in g c o n s u ltin g s e r v ic e s t o some u n s p e c ifie d
number o f small b u s in e s s e s (however d e f i n e d ) .

At th e same tim e , most

deans b e lie v e d t h a t f a c u l t y c o n s u ltin g f e e s were probably to o high f o r
th e "average" small b u sin essp erso n to a f f o r d , alth ou gh s e v e ra l a tte m p ts
to q u a l i f y t h i s were made.

Some deans d id n o t b e lie v e t h i s t o be the

c a s e , p a r t i c u l a r l y th e deans o f b u sin e ss c o lle g e s which were lo c a te d in
non-urban and s m a lle r urban a r e a s .
Given t h a t f a c u l t y members had a lim it e d amount o f time to
d evote t o c o n s u ltin g a c t i v i t i e s , and t h a t th e r a t i o n a l th in g f o r them
t o do would be to maximize th e use o f t h a t tim e in terms o f income,
i t d id n o t ap pear t h a t t h e r e were many o p tio n s a v a i l a b l e t h a t would
p ro v id e f a c u l t y members w ith s u f f i c i e n t i n c e n t i v e to p ro v id e a h ig h e r
volume o f s e r v i c e s to small b u s in e s s e s t h a t could n o t a f f o r d t o pay
c o m p e titiv e r a t e s .
The views o f b u sin e ss deans concerning th e typ e o f small b u s i ­
ness a s s i s t a n c e program model t h a t would be most e f f e c t i v e in terms o f
i t s a b i l i t y to access and u t i l i z e c o l l e g e and u n i v e r s i t y re so u rc e s were
mixed.

Those who fav ored e s t a b l i s h i n g th e program in th e u n i v e r s i t y

f e l t t h a t i t would be e a s i e r t o access and m o b ilize u n i v e r s i t y reso u rc e s

95
i f i t were a p a r t o f th e u n i v e r s i t y .

Those who th o u g h t i t would be

p r e f e r a b l e to l o c a t e such a program in th e p r i v a t e s e c t o r f e l t t h a t
th e small b u sin e ss c l i e n t e l e could more e a s i l y i d e n t i f y w ith i t * and
t h a t I t s m ission would n o t be subsumed by competing p r i o r i t i e s w ith in
a u n iv ersity s e ttin g .
I f th e program were to be designed as a u n iv e r s ity - b a s e d
program, however, most deans in d i c a t e d t h a t i t should be a d m in iste re d
by th e b u s in e s s c o l l e g e , and a few deans th o u g h t i t would b e s t be
a d m in iste re d by t h e i r c o n tin u in g e d u c a tio n d i v i s i o n s o r some o th e r
o u tre a c h u n i t which o p erated a c r o s s a l l o r g a n iz a tio n a l u n i t s w ith in
th e ir in stitu tio n .
In a tte m p tin g to determ ine th e ty p es o f b u s in e s s e s t h a t should
r e c e i v e a s s i s t a n c e , most b u s in e s s deans f e l t t h a t th e program should be
t a r g e t e d toward some pred eterm in ed segment o f th e small b u s in e s s s e c t o r .
I t was recommended by some t h a t th e program g o als should r e f l e c t th e
economic development needs o f th e s t a t e o f M ichigan, e . g . , d i v e r s i f y in g
th e economy as w ell as th e economic development needs o f th e re g io n s
w ith in th e s t a t e .

I t was a l s o recommended t h a t r e p r e s e n t a t i v e s o f th e

small b u s in e s s s e c t o r should be inv olv ed in th e p ro cess o f e s t a b l i s h i n g
th e g o als o f th e program.
The views o f th e deans concerning th e typ es o f b u s in e s s e s t h a t
should r e c e iv e high p r o p r i t y a s s i s t a n c e were mixed.

More than s i x t y

p e r c e n t o f th e deans tho ug ht t h a t a t t e n t i o n should be focused on e x i s t ­
ing b u s in e s s e s having growth p o t e n t i a l o r on new b u s in e s s e s t h a t have
high growth p o t e n t i a l .

In any e v e n t i t was n o t viewed t h a t th e program

should be a " b a il out" program f o r f a i l i n g b u s in e s s e s .

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There was a t o t a l consensus t h a t a small b u s in e s s a s s i s t a n c e
program could b e, and should b e , i n i t i a t e d w ith a very small s t a f f .
Given th e in c r e a s in g a u s t e r i t y o f a l l p u b l i c l y fin a n c e d program s, i t
appeared t h a t ex p an sio n ary n o tio n s were n o t p r e v a l e n t .

The b a s ic

s t a f f t h a t was recommended in c lu d e d a d i r e c t o r , a s e c r e t a r y , and one
o r two b u s in e s s g e n e r a l i s t s who could diagnose c l i e n t s ' problems and
match t h e i r needs w ith th e a p p r o p r i a te u n i v e r s i t y r e s o u r c e s .

A lso,

most deans tho ug ht 1 t would be d e s i r a b l e t o u t i l i z e th e t a l e n t s o f
r e t i r e d b u sin e ss e x e c u tiv e s on a v o lu n ta ry b a s is - as well as any
o t h e r e x i s t i n g re so u rc e s t h a t could be t i e d in w ith th e c e n t e r .
Recommendations as t o th e f u n c tio n a l a re a s o f a s s i s t a n c e t h a t
could be provided t o small b u s in e s s e s in c lu d e d :

t r a i n i n g , m ark etin g ,

a c c o u n tin g , p r o d u c tio n , and community development.
Most deans th o u g h t t h a t th e program should be designed t o be
s e lf-su p p o rtin g .

I t was b e lie v e d t h a t w ith "seed money" and s u f f i c i e n t

le a d tim e , th e program could be s e l f - s u s t a i n i n g .

The deans lo c a te d

in th e more r u r a l a r e a s o f th e s t a t e , however, were more s k e p t i c a l .
They were more i n c l i n e d t o th in k t h a t th e program could become p a r t i a l l y
s e l f - s u p p o r t i n g b u t t h a t i t would need t o be perm anently u n d e rw ritte n
in p a r t .
A m a jo r ity o f th e b u s in e s s deans th ou gh t t h a t i t would be
d e s i r a b l e f o r th e p a r t i c i p a t i n g i n s t i t u t i o n s to be r e q u ir e d t o pro v ide
a funding match.

Many d e a n s, however, ex p ressed th e view t h a t an i n -

kind matching arrangem ent would be more a c c e p ta b le .
Given t h r e e a l t e r n a t i v e arrangem ents f o r a d m in is te r in g and
c o o r d in a tin g a s ta te w id e network o f small b u s in e s s a s s i s t a n c e c e n t e r s ,
a m a jo rity o f th e deans determ ined t h a t t h i s r e s p o n s i b i l i t y could b e s t

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be performed by a s t a t e agency.

In many c a s e s , t h i s c h o ice was

a r r i v e d a t only by a p ro cess o f e lim i n a ti o n r a t h e r th an by Immediate
a ttra c tio n .

The second b e s t a l t e r n a t i v e , as p e rc e iv e d by th e b u s i­

ness d ean s, would be t o have one h ig h e r e d u c a tio n I n s t i t u t i o n s e rv e
as th e le a d agency and assume th e a d m i n i s t r a t i v e and c o o r d in a tin g
re sp o n sib ilitie s.

The consortium approach was l a r g e l y v etoed.

CHAPTER V
SUMMARY AND CONCLUSIONS
Summary o f th e Study
The purposes o f t h i s r e s e a r c h were:

(1) t o c o l l e c t d e t a i l e d

and f a c t u a l in fo rm a tio n t h a t would e n a b le th e r e s e a r c h e r t o a s s e s s th e
f e a s i b i l i t y and d e s i r a b i l i t y o f e s t a b l i s h i n g a small b u s in e s s d ev elop ­
ment c e n t e r program t h a t i s a d m in is te re d through th e b u s in e s s c o lle g e s
a t M ich ig an 's p u b lic f o u r - y e a r c o l l e g e s and u n i v e r s i t i e s ; (2) t o s ecu re
r e l e v a n t views and in fo rm a tio n from th e b u s in e s s deans co ncerning
s p e c i f i c i s s u e s and o p e r a tio n a l concerns in v o lv ed in d e sig n in g and
implementing a small b u s in e s s development c e n t e r program; (3) t o
a n aly ze th e e x t e n t o f agreement and disag reem en t on th e is s u e s and
concerns examined; and (4) t o develop from t h e i n te r v ie w d a ta a s e t
o f norm ative s ta te m e n ts co ncerning th e d e s i r a b l e c h a r a c t e r i s t i c s o f a
small b u s in e s s development c e n t e r program in M ichigan.
The i s s u e s ad d ressed in t h i s stu dy were d e riv e d from th e
w r i t e r ' s review o f t h e l i t e r a t u r e as p r e s e n te d in t h i s s tu d y and from
a c a r e f u l stu d y o f th e e x p e rie n c e s o f e i g h t p i l o t Small Business
Development C enter programs as r e p o r te d in v a rio u s C ongressional
h e a r i n g s , d e s c r i p t i v e m a t e r ia ls and management r e p o r t s p r e s e n te d by
th e d i r e c t o r s o f p i l o t SBDC programs a t an in fo rm a tio n s h a rin g con­
f e re n c e h e ld i n A th en s, Georgia on September 2 5 -27 , 1978.

98

The i s s u e s

99
a l s o r e f l e c t e d concerns which stemmed from th e program development
r e s p o n s i b i l i t i e s o f th e w r i t e r .

The s p e c i f i c concerns ad d ressed in

t h i s s tu d y were:
Concern 1 - The p o t e n t i a l f o r i n t e g r a t i n g th e small b u s in e s s
a s s i s t a n c e program w ith th e I n s t r u c t i o n a l program
o f th e b u s in e s s c o l l e g e s / s c h o o l s .
Concern 2 - The p o t e n t i a l f o r i n t e g r a t i n g th e small b u s in e s s
a s s i s t a n c e program w ith th e r e s e a r c h a c t i v i t i e s
o f th e b u s in e s s c o l l e g e s / s c h o o l s .
Concern 3 - The p o t e n t i a l f o r i n t e g r a t i n g th e small b u sin e ss
a s s i s t a n c e program w ith th e s e r v i c e a c t i v i t i e s
o f th e b u s in e s s c o l l e g e s / s c h o o l s .
Concern 4 - The typ e o f small b u s in e s s a s s i s t a n c e program
model t h a t would be most e f f e c t i v e in u t i l i z i n g
c o lle g e and u n i v e r s i t y r e s o u r c e s .
Concern 5 - The ty p es o f small b u s in e s s e s t h a t should r e c e iv e
a ssista n c e .
Concern 6 - The re s o u rc e req u irem en ts and funding a r ra n g e ­
ments needed t o i n i t i a t e a small b u s in e s s a s s i s ­
ta n c e program.
Concern 7 - The most a p p r o p r ia t e arrangem ent f o r a d m in is te r ­
ing and c o o r d in a tin g a s ta te w id e program.
The p o p u la tio n was composed o f a l l deans o f b u s in e s s a n d /o r
management sch o o ls o r c o ll e g e s a t th e f i f t e e n p u b l i c , f o u r - y e a r c o lle g e s
and u n i v e r s i t i e s in Michigan.
t h e p i l o t i n te r v ie w .

Two o f t h e f i f t e e n deans were s e l e c t e d f o r

The sample was composed o f th e rem aining t h i r t e e n

d e a n s.
A l e t t e r was s e n t to each o f th e b u s in e s s deans inform ing them
o f th e purpose o f th e stu d y and inform ing them t h a t an appointm ent would
be made to d is c u s s th e Small B usiness Development C en ter concept w ith
them.

100

An i n te r v ie w guide was developed which ad dressed th e seven
a r e a s o f concern l i s t e d above.

The in te rv ie w guide was s e m is tru c tu r e d

to p e rm it th e in t e r v i e w e r t o probe more deep ly i n t o th e resp o n ses t o
o b ta in more com plete d a t a .
A l e t t e r e x p la in in g th e p r o j e c t and a copy o f H.B. 5058 was
s e n t t o each o f th e b u sin e ss d eans.

Follow-up telep ho ne c a l l s were

then made t o a rra n g e appointm ent d a te s and tim e s.

I t was l e f t t o each

d e a n 's d i s c r e t i o n w hether o r n o t to in c lu d e o t h e r s t a f f members in th e
in te r v ie w .

In tw elve o f th e i n t e r v i e w s , th e r e s e a r c h e r ta lk e d only w ith

th e dean; in t h r e e o f th e i n t e r v i e w s , one s t a f f member had been i n v i t e d
by th e dean t o s i t in f o r th e purpose o f p ro v id in g supplem entary i n ­
form ation as needed.
Two p i l o t in te rv ie w s were performed p r i o r t o in te rv ie w in g th e
rem ainder o f t h e deans.

In both c a s e s , th e t r a i l s were performed so

t h a t any problems in th e in te rv ie w form at could be i d e n t i f i e d and
c o r r e c t e d p r i o r to conducting th e in te rv ie w s w ith th e rem aining t h i r t e e n
deans.

As a r e s u l t o f th e p i l o t i n t e r v i e w s , c e r t a i n q u e s tio n s were

amended, a few were d e l e t e d , and th e o r d e r in which th e concerns were
ad d ressed was changed.

I t was found t h a t 1 t was e a s i e r f o r th e I n t e r ­

v iew er to begin th e in te r v ie w by a d d re s s in g q u e s tio n s o f f a c t r a t h e r
th an q u e s tio n s which r e q u ire d c r e a t i v e s p e c u la tio n and o p in io n s .

The

p i l o t in te r v ie w r e s u l t s were n o t r e p o rte d in th e f in d in g s o f t h i s s tu d y .
Each o f th e in te rv ie w s took app ro x im ately one and o n e - h a lf
h o u rs.

They were reco rd ed using a c a s s e t t ta p e deck and n in e ty minute

tap es.

Notes were taken a f t e r each s e s s io n re g a rd in g im p re s sio n s ,

101

Im p o rtan t p o in ts* and a s p e c ts o f each in te r v ie w which were conducted
between March 27 and May 22* 1980.
A f t e r each in t e r v i e w , th e r e s e a r c h e r l i s t e n e d to th e c a s s e t t e
t a p e s w ith a copy o f th e in te rv ie w form at as a g u id e .

As answers t o

th e q u e s tio n s in th e in te r v ie w were g iv e n , th ey were t r a n s c r i b e d on
th e a p p r o p r ia te page o f th e i n te r v ie w fo rm at.
were asked t o p a r t i c i p a t e in t h e s tu d y .
answers from th e f i r s t two i n te r v ie w s .

At t h i s p o i n t two judges

They were asked to reco rd
T h e ir answers were compared t o

th e r e s e a r c h e r 's and th ey were judged to be t h e same.
th e r e s e a r c h e r co n tin u ed in d e p e n d e n tly .

At t h i s p o in t

The r e s e a r c h e r then l i s t e n e d

t o th e rem ainder o f th e ta p e s and reco rd ed th e answ ers.

The d a ta were

then c o l l a t e d acco rdin g to th e s p e c i f i c q u e s tio n s asked and th e answers
which were g iv en .
ing th e d a ta .

The two judges were asked t o p a r t i c i p a t e in c a t e g o r i z ­

All answers beyond sim ple "yes" and "no" answers were sub­

m itte d to them f o r f i n a l approval on c a t e g o r i z a t i o n .

The d a ta were

r e p o rte d in l i s t s showing th e resp o n ses t o each q u e s ti o n , th e number o f
deans who were judged to have responded in th e same way, and th e p e r ­
centage t h a t th e number r e p r e s e n te d .
Major Findings
The major f in d in g s o f th e r e s e a r c h were d isc u s s e d under th e seven
headings d e s c r ib in g th e i s s u e s which provided th e focus f o r th e s tu d y .
Concern 1 - The P o t e n t ia l f o r I n t e g r a t i n g th e Small Business
A s s is ta n c e Program w ith th e I n s t r u c t i o n a l Program o f th e
B usiness C o lle g e s /S c h o o ls .
All b u t two o f th e b u s in e s s c o lle g e s o f f e r e d small b u s in e s s
courses.

Most o f th e c o lle g e s o f f e r e d only one c o u rs e .

Only one

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c o l l e g e o f f e r e d as many as t h r e e .

For t h e most p a r t , g rad u ate le v e l

co urses focused on e n tr e p re n e u r s h ip and u n d erg radu ate co u rse s focused
on small b u sin ess management t o p i c s .

There was no evidence t h a t many

more co u rses would be in tro d u c e d in th e n e a r f u t u r e .

Only two c o lle g e s

had any co u rse development p lan s underway w ith th e i n t e n t i o n o f i n t r o ­
ducing th e s e w ith in th e coming y e a r .
Due t o cou rse packaging arran g em en ts, s tu d e n ts could e l e c t to
d e c l a r e majors in small b u s in e s s management a t two o f th e c o l le g e s .
Two o t h e r c o lle g e s were a l s o in th e pro cess o f s e t t i n g up an o p tio n
f o r t h e i r s tu d e n ts to d e c l a r e a s p e c i a l i z a t i o n in small b u s in e s s manage­
ment.
Given th e expansive e n ro llm e n ts in th e b u s in e s s c o lle g e s in
r e c e n t y e a r s , th e primary concern o f most o f th e b u s in e s s deans has
been t o develop and m aintain high q u a l i t y f a c u l t i e s f o r p ro v id in g
i n s t r u c t i o n in th e b a s i c , fundamental c o u rs e s .
Most o f th e b u s in e s s c o lle g e s were inv olv ed 1n p ro v id in g l i f e ­
long le a r n in g programs f o r small b u s in e s s e s .

In n e a r ly h a l f o f th e s e

sem inars and workshops, f u l l - t i m e f a c u l t y members were involved in
p ro v id in g th e I n s t r u c t i o n as w ell as a d ju n c t f a c u l t y members.

Many o f

th e s e programs were o f f e r e d a t off-cam pus s e t t i n g s in th e lo c a l community
and a few were o f f e r e d a t off-cam pus s e t t i n g s w ith in a given reg io n o f
th e s t a t e .

More than o n e - t h ir d o f th e b u s in e s s c o lle g e s had e s t a b l i s h e d

s e r v i c e - o r i e n t e d management c e n t e r s which were r e s p o n s i b le f o r th e
d e l i v e r y o f l i f e - l o n g l e a r n in g programs f o r b u s in e s s e s .
I t was found, to some e x t e n t , through c o o p e r a tiv e ed u catio n
program s, i n t e r n s h i p s , co u rse r e l a t e d f i e l d p r o j e c t s , and Small

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Business I n s t i t u t e program s, t h a t b u s in e s s c o lle g e s inv olv ed t h e i r
s tu d e n ts in working d i r e c t l y w ith small b u s in e s s e s as a p a r t o f t h e i r
academic programs.

Only th e SBI program i s s y ste m m a tic a lly d i r e c t e d

toward small b u s in e s s involvem ent.
All o f th e deans f e l t t h a t th e SBI program was b e n e f i c i a l .
Almost a l l o f th e deans planned t o c o n tin u e t h a t program i n d e f i n i t e l y
and would l i k e t o be a b le to expand t h a t program.

At th e same tim e ,

a v a r i e t y o f p r a c t i c a l problems were i d e n t i f i e d :

(1) d i f f i c u l t i e s in

s e c u rin g and m a in ta in in g a s u f f i c i e n t volume o f c l i e n t r e f e r r a l s from
th e Small Business A d m in is tr a tio n ; (2) s tu d e n ts who worked p a r t - t i m e
could n o t p a r t i c i p a t e in th e program due t o la c k o f tim e; (3) s e rv in g
as a f a c u l t y c o o r d in a to r f o r th e program was n o t s u f f i c i e n t l y rewarding
t o a t t r a c t f a c u l t y p a r t i c i p a t i o n ; (4) i t was d i f f i c u l t from a tim ing
s ta n d p o in t t o c o o rd in a te th e s ig n in g o f f a c u l t y c o n t r a c t s , r e g i s t r a t i o n
o f s tu d e n t s f o r th e SBI c o u r s e , and i d e n t i f y i n g and s c re e n in g small
b u s in e s s c l i e n t s ; and (5) th e t o t a l SBA g r a n t t o th e b u s in e s s c o lle g e s
was n o t co n s id e re d to be s u f f i c i e n t l y re m u n e ra tiv e .

I t seemed a p p a re n t

t h a t th e su ccess o f th e e x i s t i n g SBI programs was due 1n la r g e measure
t o th e p erso nal commitment o f a small number o f f a c u l t y members who had
a s tr o n g perso n al i n t e r e s t in s e e in g to i t t h a t th e program co n tin u ed .
Concern 2 - The P o t e n t i a l f o r I n t e g r a t i n g th e Small Business
A s s is ta n c e Program w ith th e Research A c t i v i t i e s o f th e
Business C o lleg es/S ch o o ls
A m a jo r ity o f th e b u s in e s s c o lle g e s r e p o rte d having between one
a n d - th r e e ( in most c a s e s , one) f a c u l t y members who s p e c i a l i z e d in r e ­
s e a rc h in g small b u s in e s s problem s.

S everal f a c t o r s which might accou nt

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f o r th e small number o f b u s in e s s c o l le g e f a c u l t y members whose r e ­
search i n t e r e s t i s in small b u s in e s s were i d e n t i f i e d :

(1) th e f a c t

t h a t small b u s in e s s seems to be more a m a tte r o f p erson al i n t e r e s t
than a d i s c i p l i n e o r s u b d i s c i p l i n e ; (2) f a c u l t y members were t r a i n e d
in b u s in e s s c o lle g e s w hich, t r a d i t i o n a l l y , have been o r ie n t e d toward
l a r g e r b u s in e s s o r g a n i z a t i o n s ; (3) th e r e l a t i v e d i f f i c u l t y o f s e c u rin g
d ata f o r r e s e a r c h on small firm s compared t o l a r g e r f ir m s ; and (4) th e
com parative lack o f o p p o r t u n i t i e s to p u b lis h small b u s in e s s r e s e a r c h
a r t i c l e s given th e o r i e n t a t i o n o f th e major b u s in e s s j o u r n a l s , coupled
w ith th e need o f f a c u l t y members t o p u b lis h in o r d e r t o advance t h e i r
careers.
Most b u s in e s s deans th o u g h t t h a t a small b u s in e s s development
c e n t e r , i f one were to be e s t a b l i s h e d a t t h e i r campus, would be a b le
to c r e a t e more f a c u l t y i n t e r e s t in r e s e a r c h in g small b u s in e s s problems.
Two th in g s i d e n t i f i e d , t h a t would augment th e e f f e c t i v e n e s s o f such a
c e n t e r , would be f o r th e c e n t e r t o be a b le to d e f in e th e t o p i c s o r
problems t h a t would need t o be re s e a rc h e d and t o s o l i c i t a p p l i c a t i o n s
f o r r e s e a r c h g r a n ts t o u n d e rw rite t h i s a c t i v i t y .
The SBI programs were n o t p e rc e iv e d by most o f th e deans as
being a c a t a l y s t f o r s t i m u l a t i n g r e s e a r c h on small b u s in e s s t o p i c s f o r
e i t h e r s tu d e n ts o r f a c u l t y members.

There seemed to be a consensus o f

opinion t h a t th e ty p es o f s t u d i e s conducted in c o n ju n c tio n w ith th e
SBI programs were m arketing r e s e a r c h s t u d i e s f o r in d iv id u a l f ir m s .
The most common approach su gg ested f o r s y s t e m a t i c a l l y g e n e r a tin g
more r e s e a r c h on small b u s in e s s t o p i c s was t h a t a small b u s in e s s r e s e a r c h
c e n t e r be e s t a b l i s h e d and funded f o r th e purpose o f i d e n t i f y i n g r e s e a r c h

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t o p i c s , s o l i c i t i n g r e s e a r c h p ro p o sa ls from f a c u l t y members, p ro v id in g
r e s e a r c h g r a n t s , and p u b lis h in g th e f i n d i n g s .
Concern 3 - The P o t e n t i a l f o r I n t e g r a t i n g th e Small Business
A s s is ta n c e Program w ith th e S e rv ic e A c t i v i t i e s o f th e
Business C o lle g e s/S c h o o ls
A m a jo r ity o f th e b u s in e s s deans i n d i c a t e d t h a t t h e i r i n s t i t u ­
t i o n s had p o l i c i e s l i m i t i n g th e amount o f tim e t h e i r f a c u l t y members
could spend i n p r i v a t e c o n s u ltin g a c t i v i t i e s .

However, i t was made

c l e a r in alm ost every in t e r v i e w , t h a t th e a c tu a l r u l e o f thumb en fo rced
was t h a t f a c u l t y members n o t become so inv olv ed in p r i v a t e c o n s u ltin g
t h a t i t i n t e r f e r e d w ith t h e i r o t h e r c o n t r a c t u a l o b l i g a t i o n s —e s p e c i a l l y
te a c h in g r e s p o n s i b i l i t i e s .
All o f the deans r e p o r te d t h a t t h e i r f a c u l t y members a r e i n ­
volved in p ro v id in g c o n s u ltin g s e r v i c e s t o b u s in e s s e s , in c lu d in g small
b u s in e s s e s .

While e s ti m a t e s as t o th e p e rc e n ta g e o f p r i v a t e c o n s u ltin g

s e r v ic e s devoted t o sm all b u s in e s s e s v a r ie d w id e ly , th e m a jo r ity o f
deans e x p re sse d th e view t h a t f a c u l t y f e e s were probably to o high f o r
th e "average" small b u s in e s s p e rs o n t o a f f o r d .
In d i s c u s s in g p o s s i b le in c e n t i v e s which could be in tro d u c e d to
encourage f a c u l t y members t o p ro v id e c o n s u ltin g a s s i s t a n c e t o s m a lle r
b u s in e s s e s which o th e rw ise cou ld n o t a f f o r d f a c u l t y c o n s u ltin g f e e s ,
th e most common form o f i n c e n t i v e recommended was t h a t o f p ro v id in g
monetary com pensation.

The second most common s u g g e stio n was t h a t th e

p u b lic s e r v i c e c a te g o ry be given g r e a t e r p r i o r i t y by th e c o l l e g e s in
e v a l u a ti n g f a c u l t y members f o r promotion and te n u r e .
accom plishing th e s e p o s s i b i l i t i e s in c lu d e d :

The b a r r i e r s to

(1) a la c k o f funds f o r

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p ro v id in g monetary compensation as an o f f s e t ; (2) th e lack o f a com­
p e l l i n g r a t i o n a l e f o r e l e v a t i n g th e p u b lic s e r v i c e c a te g o ry in e v a lu ­
a t i n g f a c u l t y perform ance; and (3) a la c k o f f l e x i b i l i t y in a l t e r i n g
f a c u l t y i n c e n t i v e s , i n some i n s t a n c e s , due t o th e e x i s t e n c e o f f a c u l t y
union c o n t r a c t s .
Concern 4 - The Type o f Small Business A s s is ta n c e Program Model
T hat Mould Be Most E f f e c t i v e in U t i l i z i n g C ollege
and U n iv e r s ity Resources
Opinions among th e b u sin e ss deans were f a i r l y evenly s p l i t on
th e q u e s tio n o f w hether a small b u sin e ss a s s i s t a n c e program which would
make use o f u n i v e r s i t y t a l e n t and re so u rc e s would be more e f f e c t i v e i f
i t were based in th e p r i v a t e s e c t o r o r based in one o r more u n i v e r s i t i e s .
More deans favored th e p r i v a t e s e c t o r approach than favo red th e
u n i v e r s it y - b a s e d approach, however, th e r e was no m a jo r ity o pinion on
t h i s q u e s ti o n .

Advantages and d isad v a n ta g es to each approach were

c ite d .
The advantages o f b asing th e program In th e p r i v a t e s e c t o r
in c lu d e d :

(1) small b u s in e s s e s could r e a d i l y i d e n t i f y w ith a p r i v a t e

s e c t o r o p e r a t i o n ; (2) a p r i v a t e o r g a n iz a tio n would have l e s s d i f f i c u l t y
in keeping i t s m ission and p r i o r i t i e s c l e a r l y focused t h a t a program
based in a u n i v e r s i t y ; and (3) a p r i v a t e o r g a n iz a tio n would be f r e e
from th e p o l i t i c a l funding problems encountered by p u b l i c l y sup p orted
in stitu tio n s.
The d isa d v a n ta g e s o f b asin g th e program in th e p r i v a t e s e c t o r
in c lu d e d :

(1) such a program would be more l im i t e d in i t s a b i l i t y t o

gain a c c e s s t o u n i v e r s i t y t a l e n t and r e s o u r c e s ; and (2) th e s e r v i c e s

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o f a p r i v a t e s e c t o r o r g a n iz a tio n would l i k e l y be skewed toward th e
m ajor p o p u la tio n c e n te r s o f th e s t a t e w ith l e s s a t t e n t i o n being given
t o l e s s e r urban a r e a s and o u tly in g re g io n s o f th e s t a t e .
The advantages o f a u n i v e r s it y - b a s e d program in c lu d e d :

(1)

th e a v a i l a b i l i t y o f a la r g e body o f t a l e n t w ith in th e c o lle g e s and
u n i v e r s i t i e s ; (2) th e d e s i r a b i l i t y o f u t i l i z i n g e x i s t i n g r e s o u r c e s ;
(3) th e g r e a t e r a b i l i t y o f u n i v e r s i t i e s t o m o b iliz e t h e i r own re so u rc e s
as opposed t o an o u ts id e o r g a n i z a t i o n ; and (4) th e s ta te w id e g eo g rap h i­
c al d i s t r i b u t i o n o f c o lle g e s and u n i v e r s i t i e s which could overcome a
tendency t o skew s e r v i c e s toward th e c e n t e r o f p o p u la tio n in th e s t a t e .
The d isad v a n ta g es o f b asin g a small b u sin e ss a s s i s t a n c e program
in th e c o lle g e s and u n i v e r s i t i e s in c lu d e d :

(1) an e x t e r n a l l y funded

program would be v u ln e r a b le to being absorbed and abused by i n s t i t u ­
t i o n a l p r i o r i t i e s ; (2) small b u s in e s s e s f e e l ap p reh en siv e toward u n i ­
v e r s i t i e s and might be l e s s l i k e l y t o approach a u n i v e r s i t y - b a s e d
program f o r a s s i s t a n c e ; (3) r e s e a r c h o r ie n te d u n i v e r s i t i e s ten d n o t to
be o r i e n t e d toward s o lv in g th e d a i l y o p e r a tin g problems o f p a r t i c u l a r
b u s in e s s e s ; and (4) th e u n i v e r s i t i e s might sim ply a tte m p t t o use such
a program as a budget supplem ent.
Concern 5 - The Types o f Small B usinesses That Should Receive A s s is ta n c e
A m a jo rity o f th e b u s in e s s deans f e l t t h a t a small b u s in e s s
a s s i s t a n c e program should be t a r g e t e d to a s s i s t p a r t i c u l a r segments o f
th e small b u s in e s s s e c t o r r a t h e r than p ro v id in g open-ended a s s i s t a n c e
f o r any and a l l ty p es o f small b u s in e s s e s t h a t might approach th e c e n t e r
fo r a s sis ta n c e .

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I t was recommended t h a t a t a r g e t e d approach would In clu d e:
(1) i d e n t i f y i n g s t a t e economic development n eed s; (2) i d e n t i f y i n g
re g io n a l economic development needs; and (3) p r i v a t e s e c t o r p a r t i c i ­
p a tio n in d eterm in in g program g o als and p r i o r i t i e s .
The views o f th e b u s in e s s deans were d iv id e d on th e i s s u e o f
w hether th e program should g iv e p r i o r i t y a s s i s t a n c e to new b u s in e s s e s
o r e x i s t i n g b u s in e s s e s .
I f p r i o r i t y a s s i s t a n c e were t o be given t o e x i s t i n g b u s in e s s e s ,
i t was recommended t h a t t h i s In c lu d e :

(1) b u s in e s s e s t h a t a r e s u f f i ­

c i e n t l y complex in terms o f a d m i n i s t r a t i v e s t a f f i n g ; (2) b u s in e s s e s
t h a t a r e d e c l i n i n g due to a s h i f t in m arket p o t e n t i a l ; and (3) manu­
f a c t u r i n g firm s t h a t a r e e x p o rtin g p ro d u cts o u ts id e o f th e s t a t e o r
th e lo c a l r e g io n , th e re b y c o n t r ib u t i n g t o th e growth o f th e lo c a l
economic b ase.
I f p r i o r i t y a s s i s t a n c e were to be given t o new b u s in e s s e s i t
was recommended t h a t t h i s in c lu d e :

(1) e n tr e p re n e u r s who have a new

p ro d u ct id e a t h a t has m arket p o t e n t i a l ; and (2) new b u s in e s s e s t h a t
have p o t e n t i a l f o r growing r a p i d l y and c r e a t i n g j o b s .
The ty p es o f b u s in e s s e s t h a t should r e c e iv e low p r i o r i t y a s s i s ­
t a n c e , as i d e n t i f i e d by th e d e a n s, in c lu d e d :

(1) b u s in e s s e s t h a t were

"going under" because o f mismanagement; (2) "ma and pa" b u s in e s s e s - meaning fam ily owned r e t a i l o p e r a t i o n s ; and (3) non-m anufacturing f ir m s .
Concern 6 - The Resource Requirements and Funding Arrangements f o r
I n i t i a t i n g a Small Business A s s is ta n c e Program
There was unanimous agreement among th e b u sin e ss deans t h a t a
small b u s in e s s a s s i s t a n c e program could be i n i t i a t e d w ith a very small

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sta ff.

Most deans v i s u a l i z e d t h e program bein g s t a f f e d by a d i r e c t o r ,

two b u s in e s s g e n e r a l i s t s , and a s e c r e t a r y .

Most deans f e l t t h a t i t

would be d e s i r a b l e t o augment th e prog ram 's c o n s u lt i n g c a p a b i l i t i e s
by u t i l i z i n g th e e x p e r t i s e o f r e t i r e d b u s in e s s e x e c u tiv e s who would
be w i l l i n g t o v o l u n t e e r t h e i r s e r v i c e s .
A m a jo r ity o f th e deans f e l t t h a t th e program sho u ld be
d esig ned t o be s e l f - s u p p o r t i n g , f o llo w in g a le a d tim e o f t h r e e to
fiv e y e a rs.

Those deans who opposed d e s ig n in g a s e l f - s u p p o r t i n g

program e x p re ss e d th e s e r e s e r v a t i o n s :

(1) a c e n t e r might be a b le t o

be p a r t l y s e l f - s u p p o r t i n g , b u t n o t e n t i r e l y , i f i t were e x p ected t h a t
c l i e n t f e e s would be th e so u rce o f t h a t s u p p o r t; (2) t h i s would be a
program t h a t would be p ro v id in g s e r v i c e s a t a tim e when c l i e n t s could
n o t a f f o r d th o s e s e r v i c e s ; and (3) n o t a l l r e g io n a l economies o f th e
s t a t e would have equal a b i l i t i e s to s u p p o rt such a program.
A m a jo r ity o f th e deans f e l t t h a t th e h o s t i n s t i t u t i o n ( s )
sh o u ld be r e q u ir e d to p ro v id e i n s t i t u t i o n a l funds as a match.

The

deans who opposed th e re q u irem en t o f a fun ding match d i d , however,
*

i n d i c a t e t h a t t h e i r i n s t i t u t i o n could p ro b ab ly p ro v id e an i n - k i n d
match o f some s o r t .
Concern 7 - The A p p ro p ria te S t r u c t u r e f o r A d m in isterin g
and C o o rd in a tin g a S ta te w id e Program
A m a jo r ity o f th e deans f e l t t h a t a s t a t e agency co u ld b e s t
perform t h e r e s p o n s i b i l i t i e s o f a d m in is te r in g and c o o r d in a tin g a s t a t e ­
wide network o f small b u s in e s s a s s i s t a n c e c e n t e r s .

The second b e s t

a l t e r n a t i v e would be t o have one h ig h e r e d u c a tio n i n s t i t u t i o n s e r v e as
th e le a d agency in assuming th e a d m i n i s t r a t i v e and c o o r d in a tin g

no
re sp o n s ib ilitie s .

There was alm ost no s u p p o rt f o r th e consortium

approach.
The advantages p e rc e iv e d In a d m in is te r in g th e program through
a s t a t e agency in c lu d e d :

(1) a b i l i t y t o a c t as an o b j e c t i v e b ro k er

1n th e c o n te x t o f i n t e r ! n s t l t u t i o n a l c o n f l i c t ; (2) a b i l i t y t o en su re
th e d i f f e r e n t i a t i o n o f I n s t i t u t i o n a l r o l e s in p ro v id in g a s s i s t a n c e to
th e small b u sin e ss s e c t o r ; (3) th e s t a t e , because o f i t s r e s p o n s i b i l i t y
f o r s t a t e economic developm ent, would have a b e t t e r overview o f th e
small b u s in e s s s e c t o r ' s n eed s; and (4) th e O ffic e o f Economic Develop­
ment, because o f I t s e s t a b l i s h e d c o n t a c t w ith th e b u s in e s s community
and i t s s ta te w id e v i s i b i l i t y , could very e a s i l y s e rv e as a s ta te w id e
r e f e r r a l c e n t e r f o r th e SBDC network.
The d isa d v a n ta g e s p e rc e iv e d i n a d m in is te r in g th e program through
a s t a t e agency In clu d ed :

(1) t h i s might simply provide an o p p o r tu n ity

f o r a n o th e r s t a t e bureaucracy t o expand; (2) non-academic a d m in is tr a ­
t o r s would n o t u nd erstan d th e environm ent o f academic a d m i n i s t r a t o r s ;
and (3) p u b lic funding c o n t i n u i t y could n o t be g u a ra n te e d .
The advantages p e rc e iv e d in a d m in is te r in g th e program through
a s i n g l e le a d i n s t i t u t i o n o f h ig h e r e d u c a tio n In clu d ed :

(1) a s i n g l e

I n s t i t u t i o n could e s t a b l i s h c l e a r v i s i b i l i t y th ro u g h o u t th e s t a t e as
th e p la c e small b u s in e s s e s could tu r n to f o r a s s i s t a n c e ; (2) r e s p o n s i ­
b i l i t y f o r a d m in is te r in g th e program could be c l e a r l y e s t a b l i s h e d ;
(3) academic a d m i n is tr a t o r s would be r e l a t i n g to academic a d m i n i s t r a ­
t o r s ; and (4) assuming t h a t one o f th e l a r g e r i n s t i t u t i o n s serv ed as
th e lead agency, t h i s would commit a la r g e number o f r e s o u r c e s t o th e
program a t th e o u t s e t .

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The d isad v a n ta g es p e rc e iv e d 1n a d m in is te r in g th e program through
a s i n g l e le a d I n s t i t u t i o n o f h ig h e r e d u c a tio n In c lu d e d :

(1) th e lead

I n s t i t u t i o n would be 1n a p o s i t i o n t o dominate th e program and th e
a l l o c a t i o n o f fu n d s; (2) no s i n g l e I n s t i t u t i o n in t h e s t a t e has e s ­
t a b l i s h e d any c r e d i b i l i t y w ith t h e o t h e r i n s t i t u t i o n s as being a le a d e r
in th e a re a o f small b u s in e s s developm ent; (3) any le a d I n s t i t u t i o n
would be faced w ith th e ta s k o f e s t a b l i s h i n g working r e l a t i o n s h i p s
among I n s t i t u t i o n s which norm ally m a in ta in c o m p e titiv e r e l a t i o n s h i p s ;
and (4) th e le a d I n s t i t u t i o n must be ready and w i l l i n g t o assume a
new, major a d m i n i s t r a t i v e r e s p o n s i b i l i t y .
The advantages p e rc e iv e d 1n a d m in is te r in g th e program through
a consortium o f h ig h e r e d u c a tio n i n s t i t u t i o n s in c lu d e d :

(1) i n s t i t u ­

t i o n a l re s o u rc e s could be harn essed by common g o a ls and o b j e c t i v e s ;
and (2) th e I n s t i t u t i o n s could d eterm ine t h e i r own s p e c i a l i z e d r o le s
and e s t a b l i s h a mechanism f o r r e f e r r i n g c l i e n t s t o th e a p p r o p r ia te
in stitu tio n s.
The d isad v a n ta g es p e rc e iv e d in a d m in is te r in g th e program through
a consortium o f h ig h e r e d u c a tio n i n s t i t u t i o n s in c lu d e d :

(1) to o much

i n - f i g h t i n g would be l i k e l y t o ta k e p l a c e ; (2) i n t e g r a t i n g I n s t i t u t i o n a l
r e s o u rc e s would be d i f f i c u l t t o acco m plish ; and (3) a consortium would
be to o d i f f i c u l t t o a d m in is te r .
C onclusions and Recommendations f o r th e Design o f a
Small Business A s s is ta n c e Program
On t h e b a s is o f th e i n te r v ie w d a ta i t i s th e c o n c lu sio n o f t h i s
r e s e a r c h e r t h a t th e e s ta b lis h m e n t o f a small b u s in e s s development c e n t e r
program, in c o o p e ra tio n w ith b u s in e s s c o l le g e s and s c h o o ls a t most o f

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M ich ig an 's p u b lic f o u r - y e a r c o lle g e s and u n i v e r s i t i e s , i s f e a s i b l e
and i s co n s id e re d by most b u s in e s s deans to be d e s i r a b l e .

I t is

a n t i c i p a t e d , however, t h a t t h e r e w i l l be some v a r i a t i o n among th e
I n t e r e s t e d i n s t i t u t i o n s in terms o f t h e i r c a p a c i t i e s and p r e d i s p o s i ­
t i o n s toward i n t e g r a t i n g a small b u s in e s s a s s i s t a n c e program w ith
e x i s t i n g i n s t r u c t i o n a l , r e s e a r c h and s e r v i c e programs and a c t i v i t i e s .
T h e re f o re , th e f e a s i b i l i t y and d e s i r a b i l i t y o f any p a r t i c u l a r i n ­
s t i t u t i o n ' s p a r t i c i p a t i o n in a small b u sin e ss a s s i s t a n c e program
sh ou ld remain s u b j e c t t o f u r t h e r i n v e s t i g a t i o n and dem onstration o f
i n s t i t u t i o n a l commitment to a s s i s t i n g small b u s in e s s e s .
One o f th e purposes o f t h i s stu d y was to develop a s e t o f
norm ative s ta te m e n ts d e s c r ib in g th e d e s i r a b l e c h a r a c t e r i s t i c s o f a
small b u s in e s s development c e n t e r program in M ichigan.

The norm ative

s ta te m e n ts which fo llo w a r e based in th e w r i t e r ' s i n t e r p r e t a t i o n o f
th e f in d i n g s o f t h i s s tu d y , and th e r e s p o n s i b i l i t y f o r th e s e p r e s c r i p ­
t i v e s ta te m e n ts a r e h i s a lo n e .
Recommendation 1 - I t i s recommended t h a t th e SBDC program be
i n t e g r a t e d w ith th e i n s t r u c t i o n a l programs o f th e b u sin ess
c o l l e g e s /s c h o o l s t h a t p a r t i c i p a t e in th e program.
The most obvious p o i n t o f i n t e g r a t i o n t h a t could occur would be
t o i n c o r p o r a te o r c o o r d in a te th e SBDC program w ith
grams.

th e e x i s t i n g SBI pro

The SBDC s t a f f could augment th e SBI program by a s s i s t i n g in

s c re e n in g and r e f e r r i n g small b u s in e s s c l i e n t s to th e SBI c o o r d in a t o r .
C o n ceivably, a d d i t i o n a l funding could be made a v a i l a b l e t o expand
e x i s t i n g SBI programs and e s t a b l i s h new SBI programs where needed.

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SBDC s t a f f e f f o r t s could a l s o be d i r e c t e d toward f e r r e t i n g o u t
q u a l i t y o p p o r tu n i t i e s f o r i n t e r n s h i p s and c o o p e r a tiv e e d u c a tio n e x p e r i ­
ences f o r s tu d e n ts in small b u s in e s s e s .
F urtherm ore, th e SBDC s t a f f could e x e r c i s e i n i t i a t i v e s in
I d e n t if y i n g a p p r o p r ia t e management t o p i c s f o r which small b u sin e ss
sem inars and workshops could be developed.

S tra te g ic life -lo n g

le a r n in g programs which ad d ress c l a s s e s o f problems and system ic needs
in t h e small b u s in e s s s e c t o r could be d ev ise d t o se rv e as a p o i n t o f
In ta k e f o r small b u s in e s s managers needing fo llow -up c o n s u ltin g
a s sis ta n c e .
Recommendation 2 - I t i s recommended t h a t th e SBDC program be
i n t e g r a te d w ith th e r e s e a r c h a c t i v i t i e s o f th e b u sin e ss
c o lle g e s and sch o o ls t h a t p a r t i c i p a t e in th e program.
The SBDC program should be designed t o s e rv e as a c a t a l y s t f o r
g e n e ra tin g f a c u l t y r e s e a r c h i n t e r e s t in small b u sin e ss problems.

The

SBDC s t a f f could I d e n t i f y c l a s s e s o f problem s, p a r t i c u l a r l y in th e
a re a s o f a p p lie d r e s e a r c h and p u b lic p o l i c y .

I d e a l l y , th e SBDC would

be a b le t o pro vide r e s e a r c h g r a n ts to i n t e r e s t e d f a c u l t y members.

The

SBDC s t a f f could a l s o work w ith f a c u l t y members and g ra d u a te s tu d e n ts
i n t e r e s t e d in ap p ly in g f o r f e d e r a l l y funded r e s e a r c h g r a n ts t h a t a r e
a v a i l a b l e f o r s tu d y in g sm all b u s in e s s problems.
Recomnendation 3 - I t i s recommended t h a t th e SBDC program be
i n t e g r a t e d w ith th e s e r v i c e a c t i v i t i e s o f th e b u sin e ss
c o lle g e s and sch o o ls t h a t p a r t i c i p a t e in th e program.
I t i s u n r e a l i s t i c t o e x p e c t f a c u l t y members t o become s y s te m a ti­
c a l l y involved in c o n s u ltin g small b u s in e s s e s through and SBDC in a way
t h a t ig n o re s th e f a c u l t y in c e n t i v e systems t h a t a r e in p l a c e , o r ig n o re s

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th e f a c u l t y I n c e n tiv e systems t h a t a r e 1n p l a c e , o r Ig n o res th e
c o m p e titiv e r e a l i t i e s o f p r i v a t e c o n s u ltin g a c t i v i t i e s .

T h e re f o re ,

i f an SBDC i s t o succeed in se c u rin g a p p r o p r ia te f a c u l t y e x p e r t i s e
when needed, th e SBDC program budget should in c lu d e funds which could
be used as an o f f - s e t f o r f a c u l t y members whose s e r v i c e s a r e needed
t o p ro vide c o n s u ltin g a s s i s ta n c e to high p r i o r i t y c l i e n t s who would
n o t oth erw ise be a b le to a f f o r d t h i s s e r v i c e .

O b viou sly , such a fu n d ,

i f i t were t o e x i s t would be r e l a t i v e l y small and would be drawn upon
in l i m i t e d , s t r a t e g i c circ u m sta n c e s .

For th e most p a r t , th e in c re a s e d

Involvement o f f a c u l t y members in p ro v id in g c o n s u ltin g a s s i s t a n c e to
small b u s in e s s e s would r e s u l t from th e s c re e n in g and r e f e r r a l a c t i v i t i e s
o f th e SBDC s t a f f .

A d d i t i o n a ll y , th e p o s s i b i l i t y t h a t th e p u b lic s e r v i c e

c a te g o ry be given g r e a t e r p r i o r i t y by th e p a r t i c i p a t i n g c o l l e g e s and
u n i v e r s i t i e s in e v a lu a tin g f a c u l t y members f o r promotion and te n u r e
should be e x p lo re d .
Recommendation 4 - The SBDC program should be u n i v e r s i t v - b a s e d .
Only a u n iv e r s ity - b a s e d program can a s s u r e a ccess t o u n i v e r s i t y
t a l e n t and r e s o u r c e s , and only a u n i v e r s i t y - b a s e d program can en su re
adequate geog rap hical coverage around th e s t a t e .

The program m ission

would be c l e a r l y d e fin e d in terms o f perform ance c o n t r a c t s to ensure
th e I n t e g r i t y o f th e program.

A lso , th e use o f SBDC a d v iso ry boards

comprised o f small b u sin e ss s e c t o r r e p r e s e n t a t i v e s and u n i v e r s i t y p e r ­
sonnel should be co n sid e red as a means o f s e c u rin g u s e fu l guidance and
le g i t i m iz in g th e u n i v e r s i t i e s as a source o f a s s i s t a n c e f o r small
b u s in e s s e s .

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Recommendation 5 - The SBDC program should p rov ide s e r v i c e s to
a l l ty pes o f small b u s in e s s e s w ith c e r t a i n ty p es o f b u s in e s s e s
re c e iv in g h ig h e r p r i o r i t y o r more in -d e p th a s s i s t a n c e
than o t h e r s .
C e r ta in ty pes and l e v e l s o f s e r v i c e should be provided f o r
v i r t u a l l y any small b u s in e s s t h a t would c o n ta c t th e SBDC.

Such

s e r v ic e s could in c lu d e in fo rm a tio n a l a s s i s t a n c e , r e f e r r a l t o o t h e r
so urces o f a s s i s t a n c e , b a s ic s c re e n in g and r e f e r r a l to p o t e n t i a l
f a c u l t y c o n s u l t a n t s , e n ro llm e n t in an a p p r o p r ia te sem inar o r workshop,
etc .
At th e same tim e , more in -d e p th a s s i s t a n c e could go to new
b u s in e s s e s t h a t (1) a re developing a new p ro d u ct t h a t has m arket
p o t e n t i a l and (2) can dem onstrate high growth p o t e n t i a l .

Higher

p r i o r i t y could a l s o go t o (1) m anufacturing firm s t h a t c o n tr ib u t e
s u b s t a n t i a l l y to th e economic base o f a community; (2) b u s in e s s e s
t h a t a r e e x p erien cin g a d e c l i n e due t o s t r u c t u r a l changes in th e
economy, e . g . , d r a s t i c s h i f t s in markets which re n d e r a given p ro d u ct
o b s o le t e ; and (3) b u s in e s s e s t h a t a r e s u f f i c i e n t l y s o p h i s t i c a t e d enough
to be a b le t o absorb and implement, on t h e i r own, any in fo rm atio n and
guidance re c e iv e d .
In any e v e n t, th e SBDC program should be design ed to pro vide
s t r a t e g i c a s s i s t a n c e t o s tr e n g th e n t h e small b u s in e s s s e c t o r .

The

SBDC program g o als should r e f l e c t an u n d erstan d in g o f th e s t a t e ' s
economic development n eed s, re g io n a l economic development n e e d s, and
th e concerns o f th e small b u s in e s s s e c t o r .

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Recommendation 6 - The SBDC program should be i n i t i a t e d w ith a
very small s t a f f a t each p a r t i c i p a t i n g i n s t i t u t i o n which
would f u n c tio n as a c le a rin g h o u s e in matching small
b u sin e ss needs w ith th e a p p r o p r i a t e r e s o u r c e s .
The b a s ic purpose o f th e SBDC would be to r e d i r e c t e x i s t i n g
t a l e n t s and re s o u rc e s toward a s s i s t i n g small b u s in e s s e s .

As s u c h ,

t h e r e 1s no need f o r a l a r g e cad re o f a d d i ti o n a l p r o f e s s io n a l s t a f f
members.

The p r o f e s s io n a l s t a f f o f th e SBDC would c o n s i s t o f a

d i r e c t o r and one o r two b u sin ess g e n e r a l i s t s who would be cap ab le o f
s c re e n in g p o t e n t i a l b u s in e s s c l i e n t s and matching th e needs o f c l i e n t s
w ith a p p r o p r i a t e f a c u l t y e x p e r t i s e o r n o n - u n iv e r s ity re s o u rc e s such as
th e S e rv ic e Corps o f R e tir e d Executives o r o t h e r s o u rc e s o f a s s i s t a n c e .
The most im p o rta n t s t a f f i n g f a c t o r t o be c o n s id e re d 1s t h a t o f
lead ersh ip .

I f th e d e l i v e r y system i s to f u n c tio n e f f e c t i v e l y 1n both

th e small b u s in e s s and academic c o n r n m itie s , i t i s Im p o rtan t t h a t th e
d i r e c t o r have s u f f i c i e n t c r e d i b i l i t y and in f lu e n c e w ith in both communi­
tie s.

The d i r e c t o r must have enough b u s in e s s e x p e rie n c e t o i n t e r a c t

w ith and un derstand th e problems o f t h e small b u s in e s s community and
enough academic s t a t u s t o command r e s p e c t w ith in th e u n i v e r s i t y
environm ent.
Recommendation 7 - The SBDC program should be funded bv th e S t a t e
o f Michigan u n t i l such tim e as th e program i s su p p o rted by
o t h e r so urces o f funding in c lu d in g an i n s t i t u t i o n a l m atch.
S t a t e funding has th e advantage o f being r e l a t i v e l y easy to
o b ta in i f th e program i s b e lie v e d to be im p o rta n t t o th e w e ll- b e in g o f
th e s t a t e .

However, i t has th e d isad v a n ta g e o f being u n s ta b le to th e

e x t e n t t h a t th e le v e l o f funding i s reviewed a n n u a lly and a p p r o p r i a t i o n s
a r e o f te n t i e d to p o l i t i c a l c o n s id e r a t i o n s .

F u r t h e r , when a s t a t e

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budget has to be c u t , programs o f t h i s n a tu re a r e o f te n th e f i r s t t o
be reduced o r e lim in a te d .

P r iv a t e funding ag en cies t y p i c a l l y s u p p o rt

p r o j e c t s f o r a s p e c i f i c p e rio d o f time ( u s u a ll y t h r e e to f i v e y e a r s ) ,
b u t c o n tin u a tio n funding i s d i f f i c u l t t o o b t a i n .

O btainin g funds

from small b u s in e s s u s e r f e e s w i l l be d i f f i c u l t because small b u sin e ss
managers w i l l have to be convinced t h a t th e SBDC s e r v i c e s ren d ered a r e
o f s u f f i c i e n t valu e to w a rra n t th e f e e s charged.

In any e v e n t, th e

s h o r t term goal should be t o s e c u re funding from as many so u rces as
p o s s i b l e , and th e lo n g e r term goal should be f o r each SBDC program t o
become s e l f - s u p p o r t i n g .
I n i t i a l l y , th e p a r t i c i p a t i n g i n s t i t u t i o n s should be r e q u ir e d to
p ro vide e i t h e r matching funds o r a s u b s t a n t i a l i n - k in d match t o demon­
s t r a t e th e i n s t i t u t i o n ' s commitment to th e program.
Recommendation 8 - A s t a t e - f u n d e d , u n i v e r s i t v - b a s e d , multi-campus
SBDC program should be a d m in is te re d through and c o o rd in a te d bv
th e O f f ic e o f Economic Development o f th e Michigan Department
o f Commerce.
Given th e le v e l o f i n t e r i n s t i t u t i o n a l co m p etitio n and c o n f l i c t
t h a t e x i s t s , and i s taken f o r g ra n te d in t h i s s t a t e , t h e r e i s a d e f i n i t e
need f o r an independent t h i r d p a r ty to s e rv e as an o b j e c t i v e , a d m in is tra
t i v e b ro k e r.

T h is approach would n o t n e c e s s i t a t e th e fo rm atio n o f a new

s t a t e b ureaucracy in t h a t t h i s programmatic r e s p o n s i b i l i t y could be
handled by th e e x i s t i n g Small B usiness Development D iv isio n in th e
O f fic e o f Economic Development.

F urtherm ore, th e involvem ent o f th e

O ffic e o f Economic Development would en su re t h a t th e s t a t e ' s economic
development needs would be tak en i n t o accou nt in d e sig n in g th e SBDC

118

program.

And, as p e rc e iv e d by th e b u s in e s s d e a n s , t h i s a l t e r n a t i v e

approach has fewer d isad v a n ta g es th an th e consortium approach o r th e
lead I n s t i t u t i o n approach.
I m p lic a tio n s f o r F u r th e r Research
Given th e b read th o f th e t o p i c ad d ressed 1n t h i s s tu d y and the
r e l a t i v e newness o f th e concept o f u n iv e r s it y - b a s e d small b u sin e ss
development c e n t e r s , t h e r e a r e a v a r i e t y o f r e l a t e d t o p ic s t h a t could
u s e f u l l y be ad d ressed in o th e r r e s e a r c h p r o j e c t s .
T his stu d y focused on th e a t t i t u d e s and p e r c e p tio n s o f c o lle g e
and u n i v e r s i t y a d m i n i s t r a t o r s .

I t would be o f g r e a t i n t e r e s t to de­

term ine th e a t t i t u d e s and p e r c e p tio n s o f small b u s in e s s p e rs o n s toward
th e e x i s t i n g small b u s in e s s development c e n t e r s .

I t would be i n s t r u c ­

t i v e t o compare th e a t t i t u d e s and p e r c e p tio n s o f SBDC u s e rs w ith th o se
o f n o n -u s e rs .
T his stu dy was d e lim ite d t o in c lu d e on ly f o u r - y e a r p u b lic
c o lle g e s and u n i v e r s i t i e s .

A s i m i l a r stu d y should be conducted to

determ ine what r o l e s community c o lle g e s a r e p la y in g and can p la y in
a s s i s t i n g small b u s in e s s e s .

R e la tin g t h i s t o th e above t o p i c , i t may

be t h a t t h e r e 1s a small b u s in e s s c l i e n t e l e t h a t would more r e a d i l y
r e l a t e t o a community environm ent th an to a u n i v e r s i t y environm ent.
In an e ra o f z e ro -b a s e b u d g e tin g , i t would be o f g r e a t valu e
t o d esig n a stud y o f th e im pacts o f one o r more o f th e e x i s t i n g SBDC
programs.

The im pact measures should document t h e v alu e o f th e

a s s i s t a n c e re c e iv e d by th e small b u s in e s s c l i e n t s and document th e
c o s t / b e n e f i t r a t i o s f o r th e p u b lic funds i n v e s te d in th e p ro g ram (s).

119
F i n a l l y , th e r e i s a need f o r a more s y s te m a tic u nd erstan d in g
o f why b u s in e s s e s succeed and f a i l i f SBDC programs a r e to be a b le t o
p rov ide s t r a t e g i c a s s i s t a n c e d esig ned t o maximize re so u rc e s and im p acts.

APPENDICES

APPENDIX A

LETTER AND COPY OF H.B. 5058

STATE O F MICHIGAN

WILLIAM G. MILUKEN. Q o w m o r

DEPARTMENT O F COMMERCE
WILUAM F. MCLAUGHLIN. OlfFCIor

OFFICE OF ECONOMIC DeVELOPMINT
WAVNE L WORKMAN, DircciOF

...

,
npri I J,

I SOU

P.O. Box 3022!
U nting. Michigan 48909

Dear Or. ___________________:
I am writing to you because of your position as a college administrator and
because of your knowledge of matters pertaining to business development. As
Director of the Small Business Development Division of the Michigan Office of
Economic Development. I have become most Interested 1n the roles which colleges
and universities across the country are assuming In focusing on small businesses.
I am also a candidate for the Ph.D. at Michigan State University and have decided
to conduct a research project for my dissertation which Is relevant to an area of
responsibility which may Involve my Division in working with colleges and univer­
s it ie s 1n developing a program or programs of assistance for small businesses.
1 would lik e to explain the nature of my project in the hope that you w ill be
able to help me.
During the current session of the State Legislature, a b ill (H.3. 5058) has been
Introduced which would authorize my Division to establish centers that can a s sist
small businesses. This b ill has been passed 1n the House and 1s now 1n the Senate.
A copy of H.B. 5058 1s enclosed for your Information.
The purpose of my research 1s two-fold: to determine the d esira b ility of estab lish ­
ing university-related small business development centers and to secure the views
of university administrators on sp ecific Issues and operational matters that would
be Involved 1n designing and Implementing a university-related small business
assistance program 1n Michigan.
In order to accomplish th is . I am Interviewing selected college and university
administrators. No In stitu tions or Individuals w ill be id en tified by name. To
Insure accuracy in reporting the data, the Interviews w ill be taped and notes
w ill be taken. The Interviews w ill take approximately one and one-half hours
and w ill be structured around questions deemed Important but w ill allow for
discussion of the issues and for qualifying.
I w ill be contacting you by telephone very shortly after you have received th is
le tte r to arrange an Interview with you at your convenience.
Sincerely yours.

Burton R. Jones, Director
Small Business Development 01v1s1on

120

121

HOUSE BILL No. 5058

HOUSE BILL No. 5 0 5 8
October 8, 1979, Introduced by Reps. Glngrass, Scott, Brocherton, Thaddeus
C. SCopczynski, Welborn, Dodak, Geerlings, Conroy, Vanek, Bennane, Ryan,
Vaughn, Buth, Fessler and Nick Saleh and referred to the Coumittee on
Economic Developaene and Energy.

A bill

t o c r e a t e a small b u s i n e s s development program w i t h i n t h e depa r t ment

o f commerce; and eo p r e s c r i b e t h e powers and d u t i e s o f t h e d e p a r t me n t w i t h
r e s p e c t t h e r e t o ; and t o p r o v i d e f o r a p p r o p r i a t i o n s .
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
1

Sec. 1.

2

(a)

As used in t h i s a c t :

" C e n t e r " means t h e b u s i n e s s development c e n t e r e s t a b l i s h e d

in

HOUSE BILL No.

3 sec tio n 2.
k

(b)

"Depar tment" means t h e d epa rt me nt o f commerce.

3

(c)

"Small b u s i n e s s " means an i n de p e nd e n t l y owned and

operated business

8

e n t e r p r i s e which i s n ot dominant in i t s f i e l d o f o p e r a t i o n .

7

s h a l l p r o v i d e by r u l e a d e t a i l e d d e f i n i t i o n o f what c o n s t i t u t e s a small

8

business.

9

and may c o n t a i n c r i t e r i a such as number o f employees, d o l l a r volume o f b u s i -

10

The d e f i n i t i o n s h a l l var y a c c o r d i n g t o t he p a r t i c u l a r I n d u s t r y

ness, total assets, c a p ita liz a tio n , or other related factors.

3556 '75

The deoa r t ment

122

2

1

Sec. 2.

H. 5058

A small b u s i n e s s development program i s c r e a t e d w i t h i n the

2 o f f i c e o f economic development o f t h e depa r tmen t o f commerce.

The program

3

S h a l l be implemented t hr ough a b u s i n e s s development c e n t e r .

4

c e n t e r i s t h e d i r e c t o r who s h a l l be a p p o i n t ed by t h e d i r e c t o r o f t h e o f f i c e

5

o f economic development.

6

Sec. 3-

The head o f t h e

The d i r e c t o r o f t h e b u s i n e s s development c e n t e r s h a l l

implement

7

a small b u s i n e s s development program which s h a l l p r o v i d e f o r a l l of t h e

8

fo I lowing:

9

(a)

E s t a b I i s h o e n c o f a network o f small b u s i n e s s development c e n t e r s

10 which w i l l p r o v i d e I n f o r m a t i o n a l , m a n a g e r i a l , t e c h n i c a l , and o t h e r a p p r o o r i *
11

a t e programs and s e r v i c e s to small b u s i n e s s e s and w i l l e n s u r e a de q u a t e a c ce ss

12

to t ho s e s e r v i c e s .

13

(b)

Employment o f a c e n t r a l s t a f f c o r e o f b u s i n e s s f orma t i on and

14

development p r o f e s s i o n a l s who can c o o r d i n a t e t h e a c t i v i t i e s o f and p r ov i d e

15

s p e c i a l i z e d a s s i s t a n c e to t h e small b u s i n e s s development c e n t e r s .

16

Ce)

Development, c o l l e c t i o n , and d i s s e m i n a t i o n o f i n f o r ma t i on cha t w i l l

17

be u s e f u l t o p e r so ns and o r g a n i z a t i o n s t h r ou gh o u t Che s t a t e in u n d e r t a k i n g

18

o r pr omoting t h e e s t a b l i s h m e n t and s u c c e s s f u l o p e r a t i o n o f a small b u s i n e s s

19

enterprise.

20

(d)

Cont inuous e x a mi na t i o n o f t h e needs o f smalt b u s i n e s s e s in t h i s

21

s t a t e and development o f d a t a and a n a l y s e s on t h e c o m p o s i t i o n , d i s t r i b u t i o n ,

22

r a t e s o f growth and d e c l i n e , s p e c i a l pr ob l ems, and o t h e r u s e f u l i n f or ma t i on

23

which w i l l p r o v i d e an u n d e r s t a n d i n g o f t h e dynamics o f Che small b u s i n e s s

24

sector.

25

(e)

The development and impl ementation o f small b u s i n e s s t r a i n i n g

26

programs which w i l l p r o v i d e a b e t t e r u n d e r s t a n d i n g o f s t a t e government pr o­

27

grams a f f e c t i n g small b u s i n e s s e s and improve small b u s i n e s s e n t r e p r e n e u r i a l
3556 ' 79

123

3
1
2

H. 5058

and management s k i l l s .
( f)

Promotion

o f a c t i v i t i e s and r e s o u r c e s o f s t a t e a g e n c i e s , l oc al

2

gover n me nt s, b u s i n e s s and t r a d e a s s o c i a t i o n s , e d u c a t i o n a l

institutions,

4

f o u n d a t i o n s , p r o f e s s i o n a l o r g a n i z a t i o n s , and v o l u n t e e r and o t h e r gr oups

5

toward t h e growth o f small b u s i n e s s e n t e r p r i s e s , and c o o r d i n a t i o n o f the

g e f f o r t s o f t h e s e groups w i t h t h o s e o f o t h e r s e a t s d epa r tmen t s and a g e n c i e s .
7

(g) E n t e ri n g

g of higher education

i n t o c o n t r a c t u a l a rr an ge me n t s w i t h q u a l i f i e d i n s t i t u t i o n s
t o p r o v i d e s e r v i c e s d e s i g n e d to enc o ur age a more e f f e c -

g t i v e a p p l i c a t i o n o f s c i e n c e and t e ch no l og y f o r both new and e s t a b l i s h e d
10
11
12
13
14
15

b u s i n e s s , commerci al, and i n d u s t r i a l e s t a b l i s h m e n t s ,
(i)

Preparing

and d i s s e m i n a t i n g t e c h n i c a l r e p o r t s , a b s t r a c t s , computer

t a o e s , m i c r o f i l m , r ev ie ws , and s i m i l a r s c i e n t i f i c o r e n g i n e e r i n g i n f o rm a t i o n .
(ii)

P ro v i d i n g a r e f e r e n c e s e r v i c e t o i d e n t i f y

sources of engineering

and o t h e r s c i e n t i f i c e x p e r t i s e .
(iii)

Sponsori ng -workshops, s e m i n a r s , t r a i n i n g

1g

and f i e l d v i s i t s d e s i g n e d t o e n c ou r age t he e f f e c t i v e

17

and e n g i n e e r i n g i n f o r m a t i o n .

1g

including the following:

(h)

pr ograms, d e m o n s t r a t i o n s ,
application of s c ie n tific

S ec u r i n g and a d m i n i s t e r i n g f e d e r a l f unding g r a n t s f o r t h e p ur pose o f

10

engaging in e x p er i me n t a l and d e m o n s t r a t i o n programs des i g ned t o overcome t h e

20

problems o f small b u s i n e s s e n t e r p r i s e s .

21
22
23

Sec.

1*.

C l)

The b u s i n e s s development c e n t e r s h a l l p er fo r m t he f o l l o w i n g

small b u s i n e s s advocacy and p o l i c y development s e r v i c e s on a c o n t i n u i n g b a s i s :

(a) S er vi ng as a f oca l p o i n t f o r t h e r e c e i p t o f c o m p l a i n t s , c r i t i c i s m s .

24

and s u g g e s t i o n s c o n c e r n in g t h e p o l i c i e s and a c t i v i t i e s o f s t a t e a g e n c i e s which

25

a f f e c t small b u s i n e s s e s .

20
27

(b)

Counseling small b u s i n e s s e s on how t o r e s o l v e q u e s t i o n s and problems

c o n c e r n i ng t h e r e l a t i o n s h i p o f small b u s i n e s s t o s t a t s government.
3556 ' 73

124

H. 5058

k

1

(c) Developing l e g i s l a t i v e recommendations and changes in s t a t e g o ve r n-

2

ment p o l i c i e s and p r o c e du r es t h a t w i l l a s s i s t

3

t he ni n g o f small b u s i n e s s e s in t h i s s t a t e .

4

in the development and s t r a n g *

(d) R e p r es e n t i n g the views and i n t e r e s t s o f small b u s i n e s s e s b e f o r e

3 s t a t e a g e n c i e s whose p o l i c i e s and a c t i v i t i e s may a f f e c t small b u s i n e s s .
5

(2) The d i r e c t o r o f commerce s h a l l o r g a n i z e a r e o r e s e n t a t i v e s t a t e w i d e

7 small b u s i n e s s advocacy c o u n c i l t o a d v i s e and a s s i s t t h e o f f i c e o f economic
3 development in c a r r y i n g o u t t h e p ur pos e s o f t h i s s e c t i o n .
3 s h a l l c o n s i s t o f 15 members.

The c ou n c i l

The g over nor s n a i l a p p o i n t members t o t h e

1 0 c ounc il w i t h t h e a d v i c e and c on s e n t o f t h e s e n a t e .

5xee p t as o t h e r w i s e

pr ov id e d by law, members o f t h e c ou nc i l s h a l l s e r v e w i t h o u t compensation but
12

s h a l l be e n t i t l e d t o r e a s o n a b l e and n e c e s s a r y expenses i n c u rr e d in t h e d i s -

13

c h a rg e o f t h e i r d u t i e s .

14

t e r ms , e x c e p t t h a t 7 o f

The c ou nc il members s h a l l be a p p o i n t e d

for 3-year

t h e i n i t i a l ap p oi n t me nt s s h a l l be f o r a term o f 18

13 months.
13

( 3 ) in implementing t h i s s e c t i o n ,

t he d i r e c t o r o f t h e b u s i n e s s develop*

17 ment c e n t e r may do any o r a l l o f t h e f o l l o w in g:
18

(a) Cons ul t w i t h e x p e r t s and a u t h o r i t i e s in the f i e l d s of small b us i *

19 n e s s i n v e s t me n t , v e n t u r e c a p i t a l ,

investment and commercial b a n k i n g , and

20

o t h e r comparable f i n a n c i a l

i n s t i t u t i o n s involved in t h e f i n a n c i n g o f b u s i n e s s ;

21

w i t h i n d i v i d u a l s w i t h r e g u l a t o r / , l e g a l , economic, o r f i n a n c i a l e x p e r t i s e ,

22

I n c l u d i n g members o f t h e academic community; and wi t h i n d i v i d u a l s who gener *

23 a l l y represent the public i n te r e s t.
24

(b) U t i l i z e t h e s e r v i c e s o f t h e small b u s i n e s s advocacy c oun c il

25

es tab lish ed pursuant to

section

26

commlttaes a s n e c e s s a r y

t o implement

27

W

3556 '79

k{2)

and a p p o i n t o t h e r a d v i s o r y boar ds o r
this section.

Each y e a r t h e small b u s i n e s s advocacy c ou nc i l s h a l l submi t t o t h e

125

5

H. 5038

1 gover nor end t h e l e g i s l a t u r e a d e s c r i p t i o n o f I t s a c t i v i t i e s and a summary
2 o f I t s f i n d i n g s and recommendations.
3

Sec. 5-

The d i r e c t o r o f t h e o f f i c e o f economic development s h a l l

report

4

t o t h e l e g i s l a t u r e w i t h i n 12 months a f t e r a p p r o p r i a t i o n o f o p e r a t i n g f u n ds ,

5

and t h e r e a f t e r on an annual b a s i s , on t h e p r o g r e s s made in implementing t he

3 a c t i v i t i e s and programs p r ovi de d f o r in t h i s a c t .

The r e p o r t t o t h e l e g i s -

7

l a t u r e s h a l l s t a t e t he g o al s and o b j e c t i v e s o f t h e c e n t e r ' s programs and

3

c r i t e r i a by which t h e p er f ormance o f t h e programs may be e v a l u a t e d .

3

y e a r s a f t e r t h e a p p r o p r i a t i o n o f o p e r a t i n g funds t h e l e g i s l a t u r e s h a l l make

Three

10

a r e d e t e r m i n a t i o n c o n c er ni ng t h e c o n t i n u a n c e o r d i s c o n t i n u a n c e o f funding

11

f o r a l l o r p a r t o f t h e c e n t e r ' s programs.

12
13

Sec. 6 .

The l e g i s l a t u r e s h a l l a n n u a l ly a p p r o p r i a t e o p e r a t i n g funds f or

t h e smalt b u s i n e s s development program p r e s c r i b e d in t h i s a c t , which s h a l l

1 4 be i nc l uded in t h e budget f o r t h e de p a r t me n t .
3556 '79

APPENDIX B
STRUCTURED INTERVIEW FORMAT

APPENDIX B

STRUCTURED INTERVIEW FORMAT

Concern 1 - The p o t e n t i a l f o r i n t e g r a t i n g th e small b u sin ess a s s i s t a n c e
program w ith th e i n s t r u c t i o n a l program o f th e b u sin e ss
co lleg e/sc h o o l.
A.

Do you c u r r e n t l y o f f e r academic c o u rse s w ith in your degree programs
in e n t r e p r e n e u r s h ip a n d /o r small b u s in e s s management?

B.

How many e n tr e p r e n e u r s h ip /s m a ll b u s in e s s management co u rses do you
offer?

C.

Are th e s e co u rses designed f o r g ra d u a te s o r u n dergradu ates?

D.

Have you co n s id e re d developing c u r r i c u l a which would g iv e s tu d e n ts
th e o p tio n o f fo rm a lly s p e c i a l i z i n g in e n t r e p r e n e u r s h ip and small
b u s in e s s management?

E.

Does y o u r c o lle g e /s c h o o l o f f e r l i f e - l o n g l e a r n in g programs t h a t
a r e designed f o r and marketed t o small b u s in e s s e s?

F.

Who p ro v id e s th e i n s t r u c t i o n in th e s e l i f e - l o n g le a r n i n g programs?

G.

At what l o c a ti o n s a r e th e s e l i f e - l o n g l e a r n in g programs o f fe r e d ?

H.

Through what o r g a n iz a tio n a l u n i t a r e th e s e l i f e - l o n g le a r n in g p ro ­
grams a d m in iste re d ?

I.

Does y o u r c o lle g e /s c h o o l sponsor any s e r v i c e - l e a r n i n g programs t h a t
g iv e s tu d e n ts d i r e c t c o n t a c t e x p e rie n c e s w ith small b u s in e s s firm s?

J.

What kind o f s e r v i c e - l e a r n i n g programs do you sponsor?

K.

Have you found th e SBI program to be b e n e f i c i a l f o r you r s tu d e n ts ?

L.

Would you f a v o r expanding yo ur SBI program i f t h i s were p o s s ib le ?

M.

Would i t be f e a s i b l e to expand your SBI program?

N.

Do you p lan t o c o n tin u e th e SBI program i n d e f i n i t e l y ?

126

127
0.

What d i f f i c u l t i e s , i f any, do you ex p e rie n c e in a d m in is te r in g th e
SBI program?

P.

(For th o se i n s t i t u t i o n s n o t sp o n so rin g an SBI)
e s t a b l i s h i n g a Small Business I n s t i t u t e here?

Have you c o n sid e red

Concern 2 - The p o t e n t i a l f o r i n t e g r a t i n g th e small b u s in e s s a s s i s t a n c e
program w ith th e r e s e a r c h a c t i v i t i e s o f th e b u sin ess
c o l l e g e / s c h o o l.
A.

Do you have f a c u l t y members who s p e c i a l i z e in re s e a r c h in g small
b u s in e s s problem t o p i c s ? I f s o , how many?

B.

Does th e f a c t t h a t small b u s in e s s management 1s n o t a d i s c i p l i n e
p e r se i n h i b i t f a c u l t y r e s e a r c h in t h i s are a ? What o t h e r f a c t o r s
might account f o r th e g en eral la c k o f f a c u l t y i n t e r e s t in con ducting
r e s e a r c h on small b u s in e s s t o p i c s ?

C.

I f a small b u s in e s s development c e n t e r were based in t h i s c o l l e g e /
s c h o o l, do you th in k t h i s would p rov ide a mechanism f o r s ti m u l a t i n g
more r e s e a r c h r e l a t e d t o small b u s in e s s problems?

D.

Has y o u r SBI program g e n e ra te d r e s e a r c h o p p o r t u n i t i e s f o r your
s tu d e n ts ? For y o u r f a c u l t y ?

Concern 3 - The p o t e n t i a l f o r i n t e g r a t i n g th e small b u s in e s s a s s i s t a n c e
program w ith th e s e r v i c e a c t i v i t i e s o f th e b u s in e s s c o l l e g e /
s c h o o l.
A. In yo u r o p in io n , what 1s th e most p ro b ab le way in which more r e s e a r c h
which fo cu ses on small b u s in e s s t o p i c s could be g e n e ra te d 1n a s y s ­
te m a tic way?
B. Does y o u r i n s t i t u t i o n have a p o lic y governing th e amount o f tim e
f a c u l t y members may devote t o p r i v a t e c o n s u ltin g a c t i v i t i e s ?
C. Are y o u r f a c u l t y members r e q u ire d t o r e p o r t on a l l o f t h e i r p r i v a t e
c o n s u ltin g a c t i v i t i e s ?
D. What p e r c e n t o f y o u r f a c u l t y members would you e s tim a t e a r e p ro v id in g
some c o n s u ltin g s e r v i c e s t o small b u s in e s s e s ?
E.

In y o u r o p in io n , a r e f a c u l t y c o n s u ltin g f e e s g e n e r a ll y to o high f o r
th e av erag e small b u s in e ssp e rso n t o a f f o r d ?

F.

What forms o f I n c e n tiv e s could be in tro d u c e d t o encourage f a c u l t y
members t o p ro vid e c o n s u ltin g a s s i s t a n c e t o small b u s in e s s e s t h a t
o th e rw ise could n o t a f f o r d t h e i r s e r v ic e s ?

128

Concern 4 - The typ e o f small b u s in e s s a s s i s t a n c e program model t h a t
would be most e f f e c t i v e .
E x p lan a tio n :

The Michigan Department o f Commerce i s
c u r r e n t l y e v a lu a tin g two b a s ic program
models f o r p ro v id in g m anagerial and t e c h n i ­
c a l a s s i s t a n c e t o small b u s in e s s e s . Both
program models would a tte m p t t o u t i l i z e
u n i v e r s i t y t a l e n t s and r e s o u r c e s . One model
would be o rg an ized and based in th e p r i v a t e
s e c t o r as a n o n p r o f i t SBDC. The o t h e r would
be a u n iv e r s i ty - b a s e d SBDC.

A.

Do you th in k t h a t one o f th e s e approaches would be more e f f e c t i v e
th an th e o t h e r in s e c u rin g th e p a r t i c i p a t i o n o f and a c c e s s t o th e
r e s o u r c e s o f th e c o lle g e s and u n i v e r s i t i e s ? Which one? Why?

B.

I f th e c o l l e g e / u n i v e r s i t y - b a s e d model were s e l e c t e d and implemented
a t t h i s i n s t i t u t i o n , what o r g a n iz a tio n a l u n i t o r u n i t s w ith in t h i s
c o l i e g e / u n i v e r s i t y should a d m in is te r th e program?

Concern 5 - The ty pes o f b u s in e s s e s t h a t should r e c e iv e a s s i s t a n c e .
A.

In view o f th e li m i t e d r e s o u r c e s a v a i l a b l e t o a s s i s t small b u s in e s s e s ,
do you th in k t h a t i t would be n e c e s sa ry t o p r i o r i t i z e th e t a r g e t
groups w ith in th e small b u s in e s s s e c t o r t h a t would be r e c e iv in g
a s s i s t a n c e o r should th e program remain open-ended?

B.

How would you c h a r a c t e r i z e th e kinds o f b u s in e s s e s t h a t should
r e c e iv e high p r i o r i t y ?

C.

How would you c h a r a c t e r i z e th e kinds o f b u s in e s s e s t h a t should
r e c e iv e low p r i o r i t y ?

Concern 6 - The re so u rc e req u irem en ts and funding arrangem ents f o r
i n i t i a t i n g a small b u s in e s s a s s i s t a n c e program.
A.

In y o u r o p in io n , what would be th e s t a f f i n g req u irem en ts f o r o p er­
a t i n g a small b u s in e s s a s s i s t a n c e program?

B.

What kind o r kind s o f e x p e r t i s e should be r e p r e s e n te d on th e s t a f f ?

C.

Some Small Business Development C en ters have attem p ted to augment
t h e i r c a p a c ity f o r p ro v id in g c o n s u ltin g a s s i s t a n c e by d eveloping
an a f f i l i a t i o n w ith th e SBA's S e rv ic e Corps o f R e tir e d Executives
and th e A ctive Corps o f E x e c u tiv e s. Do you th in k t h i s i s a course
o f a c t io n you would want t o pursue?

129
D.

Should th e program be desig ned t o become s e l f - s u p p o r t i n g w ith in a
given amount o f time?

E.

Should i n s t i t u t i o n a l funds be r e q u i r e d to match th e s t a t e ' s funds?

Concern 7 - The a p p r o p r i a t e s t r u c t u r e f o r a d m in is te r in g and c o o r d in a tin g
a s ta te w id e program.
A.

Assuming t h a t f e d e r a l a n d /o r s t a t e funds were a v a i l a b l e to e s t a b l i s h
s e v e ra l c o l l e g e / u n i v e r s i t y - b a s e d small b u s in e s s a s s i s ta n c e programs
1n M ichigan, th e a d m i n is t r a t i o n and c o o r d in a tio n o f th e s e programs
could be achieved in v a rio u s ways. Three p o s s i b l e approaches t h a t
have been co n s id e re d a r e : (1) t o c o o r d in a te th e program through a
s i n g l e , lead i n s t i t u t i o n o f h ig h e r e d u c a tio n ; (2) t o c o o rd in a te th e
program through a consortium e s t a b l i s h e d by th e p a r t i c i p a t i n g i n s t i ­
t u t i o n s ; o r (3) t o c o o r d in a te th e program through a s t a t e agency
such as th e Michigan Department o f Commerce's O f fic e o f Economic
Development. Given th e s e a l t e r n a t i v e s what would be y o u r f i r s t ,
second and t h i r d ch o ices in o r d e r o f p r i o r i t y ?

B.

What a r e th e advantages and d isa d v a n ta g e s you see r e l a t e d t o :
(1) C o o rd in atin g th e program through a s i n g l e , le a d i n s t i t u t i o n ?
(2) C o o rd in atin g th e program through a consortium ?
(3) C o o rd in atin g th e program through a s t a t e agency?

APPENDIX C
COMPILATION OF DEANS' RESPONSES
TO STRUCTURED INTERVIEW

APPENDIX C
COMPILATION OF DEANS' RESPONSES
TO STRUCTURED INTERVIEW
CONCERN:

1.

THE POTENTIAL FOR INTEGRATING THE SMALL BUSINESS ASSISTANCE
PROGRAM WITH THE INSTRUCTIONAL PROGRAM OF THE BUSINESS
COLLEGE/SCHOOL

Q uestion:

Do y o u r c u r r e n t l y o f f e r academic co u rses w ith in you
degree programs in e n tr e p r e n e u r s h ip a n d /o r small b u s i­
ness management?

Answer
a.
b.
2.

Yes
No

Q uestion:

3.

78.0
14.0

Number

P e rc e n t

6
2
3

54.4
18.1
27.2

Are th e s e co u rses designed f o r g ra d u a te s o r under­
g ra d u a te s?

Answer
a.
b.
c.

11

How many e n tr e p r e n e u r s h ip /s m a ll b u sin e ss management
co u rses do you o f f e r ?

One
Two
Three

Q uestion:

P ercen t

2

Answer
a.
b.
c.

Number

Undergraduates
G raduates
Both

130

Number

P e rc e n t

9
8
2

47.3
42.1
10.5

*131
4.

Q uestion:

Have you co n sid e red developing c u r r i c u l a which would
g iv e s tu d e n ts th e o p tio n o f fo rm a lly s p e c i a l i z i n g in
e n tr e p r e n e u r s h ip and small b u s in e s s management?

Answer
a.
b.
c.
d.
5.

Number

Yes; One i s c u r r e n t l y o f fe r e d
Yes; An o p tio n i s c u r r e n t l y
being developed
Yes; No a c t i o n has been taken
No; I t has n o t been c o n sid e re d

Q uestion:

Yes
No

Q uestion:

c.

P r im a r ily f u l l - t i m e f a c u l t y
A mix o f f u l l - t i m e f a c u l t y
and a d ju n c t f a c u l t y
P r im a r ily a d ju n c t f a c u l t y

Q u estio n:

On campus
Of campus, l o c a l l y
Off campus, r e g i o n a lly

Q uestion:

15.3
30.7
38.4

Number

P e rc e n t

8
5

61.5
3 8.4

Number

P e rc e n t

4

30.7

2
2

15.3
15.3

Number

P e rc e n t

6
6
3

46.1
46.1
23.0

Through what o r g a n i z a ti o n a l u n i t a r e th e s e l i f e - l o n g
l e a r n in g programs a d m in iste re d ?

Answer
a.
b.

2
4
5

At what lo c a t i o n s a r e th e s e l i f e - l o n g l e a r n in g programs
o f fe r e d ?

Answer
a.
b.
c.

15.3

Who p ro v id e s th e i n s t r u c t i o n in th e s e l i f e - l o n g le a r n in g
programs?

Answer
a.
b.

2

Does y o u r c o lle g e /s c h o o l o f f e r l i f e - l o n g l e a r n in g p ro ­
grams t h a t a re designed f o r and marketed t o small
b u s in e s s e s?

Answer
a.
b.

P e rc e n t

Business c o lle g e /s c h o o l
C ontinuing e d u c a tio n d i v i s i o n

Number

P e rc e n t

5
3

38.4
2 3.0

132
9.

Q uestion:

Does y o u r c o lle g e /s c h o o l sponsor any s e r v i c e - l e a r n i n g
programs t h a t g iv e s tu d e n ts d i r e c t c o n t a c t e x p e rie n c e s
w ith small b u s in e s s firm s?

Answer
a.
b.
10.

Yes
No

Q uestion:

11.

12.

13.

8

14.

Answer
a.
b.

Yes
No

P e rc e n t

( 100. 0 )*
-

0-

Number

P e rc e n t

4
2

(5 7 .1 )
(2 8 .5 )
(1 4 .2 )

1

Number

Yes
No
U n certain

Q uestion:

5 3.8
6 1 .5
61.5

Would i t be f e a s i b l e t o expand yo u r SBI program?

Answer
a.
b.
c.

P e rc e n t

Would you f a v o r expanding y o u r SBI program i f t h i s
were p o s s ib le ?

Yes
No
U ncertain

Q uestion:

8

0

Answer
a.
b.
c.

7

8

Number

Yes
No

Q uestion:

84.6
15.3

Have you found th e SBI program t o be b e n e f i c i a l f o r
your s tu d e n ts ?

Answer
a.
b.

11
2

Number

Small B usiness I n s t i t u t e
C o op erativ e e d u c a tio n
I n te r n s h ip s

Q uestion :

P e rc e n t

What kind o f s e r v i c e - l e a r n i n g programs do you sponsor?

Answer
a.
b.
c.

Number

0
6
1

P e rc e n t
-

0-

8 5 .7 )
14.2)

Do you plan t o c o n tin u e th e SBI program i n d e f i n i t e l y ?
Number

6
1

P e rc e n t
(8 5 .7)
(14.2)

* P ercen tag es in p a re n th e se s r e f e r on ly to th o s e i n s t i t u t i o n s w ith
SBI programs, (n=7)

133

15.

Q uestion:

What d i f f i c u l t i e s , i f any , do you e x p e rie n c e in ad­
m in is te r in g th e SBI program?

Answer
a.
b.
c.
d.

e.
f.
16.

Number

S u f f i c i e n t volume o f c l i e n t s no
r e f e r r e d by Small B usiness Ad­
m in istra tio n
S tu d en ts n o t a v a i l a b l e in s u f f i ­
c i e n t numbers due t o p a r t - t i m e
employment
F a c u lty involvem ent i s n o t s u f f i ­
c i e n t l y r e w a rd in t t o m ain tain t h e i r
s u p p o rt
D i f f i c u l t to c o o r d in a te s tu d e n t
r e g i s t r a t i o n in SBI, f a c u l t y work
lo ad c o n t r a c t s , and l i n i n g up b u s i ­
ness case loads
SBA g r a n t i s n o t s u f f i c i e n t l y
rem u n erativ e
Meeting w ith c l i e n t s o f te n in v o lv e s
long t r a v e l d i s ta n c e s

Q uestion :

3

(42 .8)

1

(14.2)

2

(28.5)

1

0 4 .2 )

1

(14.2)

1

(14.2)

(For th o se i n s t a n c e s n o t s p o n so rin g an SBI) Have you
c o n sid e red e s t a b l i s h i n g a Small B usiness I n s t i t u t e
here?

Answer
a.
b.

Yes
No

Number

P e rc e n t

3
3

DNA
DNA

Reasons I n s t i t u t i o n s do n o t have SBI program s:
a.
b.
c.
d.

P ercen t

Low p r i o r i t y c o n s id e r a t i o n
Would n o t be a b e n e f i c i a l use o f
f a c u l t y tim e
Lack o f f a c u l t y re s o u rc e s
Lack o f g ra d u a te program

2
1
1
1

134

CONCERN:

17.

THE POTENTIAL FOR INTEGRATING THE SMALL BUSINESS ASSISTANCE
PROGRAM WITH THE RESEARCH ACTIVITIES OF THE BUSINESS COLLEGE/
SCHOOL

Question:

Do you have f a c u l t y members who s p e c i a l i s e in r e s e a r c h ­
ing small b u s in e s s problem to p ic s ? I f s o , how many?

Answer
Yes:
One
Two
Three
No
18.

Q uestion:

c.
d.
19.

Small b u s in e s s n o t a d i s c i p l i n e
G raduate t r a i n i n g o f f a c u l t y o r i ­
e n ted toward la r g e o r g a n iz a tio n s
Data on l a r g e o r g a n iz a tio n s i s
e a s i e r t o o b ta in
Small b u s in e s s i s a broad o r ie n ­
ta tio n ; not a s p e c ia liz a tio n

Q uestion:

Yes
No
Not s u re

Q uestion :

b.

38.4
7 .6
7 .6
46.1

Number

P e rc e n t

6

46.1

4

30.7

2

15.3

1

7.0

Number

P e rc e n t

9
1
3

69.2
7.0
23.0

Has your SBI program g e n e ra te d r e s e a r c h o p p o r tu n i t i e s
f o r yo ur s tu d e n ts ? For y o u r f a c u l t y ?

Answer
a.

5
1
1
6

I f a small b u s in e s s development c e n t e r were based in t h i s
c o l l e g e / s c h o o l , do you th in k t h i s would p ro v id e a mech­
anism f o r s t i m u l a t i n g more r e s e a r c h r e l a t e d t o small busi
ness problems?

Answer
a.
b.
c.

P e rc e n t

Does th e f a c t t h a t small b u s in e s s management i s n o t a
d i s c i p l i n e p e r se i n h i b i t f a c u l t y r e s e a r c h in t h i s are a ?
What o t h e r f a c t o r s m ight accou nt f o r th e general la c k o f
f a c u l t y i n t e r e s t in conducting r e s e a r c h on small b u s in e s s
to p ics?

Answer
a.
b.

Number

For s tu d e n ts
Yes
No
For f a c u l t y
Yes
No

Number

P e rc e n t

2
5

(2 8 .5 )
(7 1.4)

1
6

(1 4.2)
(8 5.7)

135
CONCERN:

21.

THE POTENTIAL FOR INTEGRATING THE SMALL BUSINESS ASSISTANCE
PROGRAM WITH THE SERVICE ACTIVITIES OF THE BUSINESS
COLLEGE/SCHOOL

Q uestion:

In y our o p in io n , what 1s th e most prob ab le way In which
more r e s e a r c h which fo cu ses on small b u s in e s s to p i c s
should be g en erated 1n a s y s te m a tic way?

Answer
a.
b.
c.
d.
e.
f.
22.

E s t a b l is h and fund a small b u s i­
ness r e s e a r c h c e n te r
F a c i l i t a t e p u b lish in g o f r e s e a r c h
fin d in g s
Give f a c u l t y r e l e a s e tim e o r make
such r e s e a r c h a p a r t o f t h e i r
co n tracts
Define small b u s in e s s r e s e a r c h
agenda
The c o ll e g e could ta k e on th e
p r o j e c t s and charge th e f e e s and
p arcel o u t th e r e s e a r c h assignm ents
D on 't know

Q uestion:

Answer
a.
b.
23.

Yes
No

Q uestion:
Answer
a.
b.

Number

Yes
No

P e rc e n t

7

53.8

1

7 .0

1

7 .0

1

7 .0

1
1

7 .0
7 .0

Does your i n s t i t u t i o n have a p o lic y governing th e
amount o f time f a c u l t y members may d evote t o p r i v a t e
c o n s u ltin g a c t i v i t i e s ?
Number

P e rc e n t

9
4

69.2
30.7

Are y o u r f a c u l t y members r e q u ir e d t o r e p o r t on a l l
o f t h e i r p r i v a t e c o n s u ltin g a c t i v i t i e s ?
Number

P e rc e n t

11
3

84.6
23.0

136

24.

Q uestion:

What p e r c e n t o f y o u r f a c u l t y members would you e s t i ­
mate a r e p ro v id in g some c o n s u ltin g s e r v i c e s to small
b u s in e s s e s?

Answer
a.
b.
c.
d.
e.
f.
9h.
i.
j.
25.

0
10
20
30
40
50
60
70
80
90

- 10
- 20
- 30
- 40
- 50
- 60
- 70
- 80
- 90
- 100

Q uestion:

26.

Yes
No

Q uestion:

c.
d.

1
1
2
3
3
2
0
0
0
1

7 .0
7 .0
15.3
23.0
23.0
15.3
-0 -0 -0 7.0

Number

P e rc e n t

8
5

61.5
46.1

What forms o f i n c e n t i v e s could be in tro d u c e d t o en­
courage f a c u l t y members to p rov id e c o n s u ltin g a s s i s t a n c e
t o small b u s in e s s e s t h a t o th e rw ise could n o t a f f o r d
t h e i r serv ices?

Answer
a.
b.

P e rc e n t

In y o u r o p in io n , a r e f a c u l t y c o n s u ltin g f e e s g e n e r a lly
to o high f o r th e average small b u s in e ssp e rso n t o a f f o r d ?

Answer
a.
b.

Number

Provide monetary compensation
Community ( p u b lic ) s e r v i c e could
be given g r e a t e r c o n s id e r a t i o n in
e v a lu a tin g f a c u l t y
P rovide f a c u l t y w ith r e l e a s e time
S e t up c o n s u ltin g o p p o r tu n i t ie s
t h a t y i e l d d a ta f o r p u b lis h a b le
research

Number

P e rc e n t
46.1

5
1

38.4
7 .0
7 .0

137
CONCERN:

THE TYPE OF SMALL BUSINESS PROGRAM MODEL THAT WOULD BE
MOST EFFECTIVE
E x p lan a tio n :

27.

Q uestion:

Answer

The Michigan Department o f Commerce i s c u r r e n t l y
e v a lu a tin g two b a s ic program models f o r p ro ­
v id in g m anagerial and te c h n i c a l a s s i s t a n c e to
small b u s in e s s e s . Both program models would
a tte m p t t o u t i l i z e u n i v e r s i t y t a l e n t s and
r e s o u r c e s . One model would be o rg an ized and
based in th e p r i v a t e s e c t o r as a n o n p r o f i t SBDC.
The o t h e r would be a u n i v e r s i t y - b a s e d SBDC.

Do you th in k t h a t one o f th e s e approaches would be more
e f f e c t i v e than th e o t h e r in se c u rin g th e p a r t i c i p a t i o n
o f and ac c e s s to th e re s o u rc e s o f th e c o lle g e s and
u n i v e r s i t i e s ? Which one? Why?
Number

P e rc e n t

a.

U n iv e r s ity - b a s e d
5
Reasons:
1. I f i t were in th e p r iv a t e
s e c t o r , i t would be l im ite d
i n i t s a b i l i t y t o a ccess
u n iv e rsity resources.
2. P ro p e rly c h an n eled , c o lle g e s
and u n i v e r s i t i e s have a l o t o f
t a l e n t t h a t could be u t i l i z e d .
3. We should use e x i s t i n g r e ­
s o u rces r a t h e r th an s e t up
something new.
4. A p r i v a t e s e c t o r - b a s e d program
would be skewed toward th e cen­
t e r o f p o p u la tio n in t h e s t a t e .

38.4

b.

P r i v a t e s e c to r - b a s e d
6
Reasons:
1. I n s t i t u t i o n s o f h ig h e r educa­
t i o n ten d t o g e t to o wrapped up
in w h a t's good f o r them selv es.
2. Small b u s in e s s e s a r e l e a r y o f
u n iv e rsitie s.
3. Freedom from p o l i t i c a l funding
problems.
4. U n i v e r s i t i e s a r e to o p o l i t i c a l .
5. U n i v e r s i t i e s w i l l look a t t h i s
as a budgetary supplem ent.
6. U n i v e r s i t i e s a r e n o t designed to
s o lv e in d iv id u a l problem s; th ey
a r e designed t o s o lv e c l a s s e s o f
problems.

46.1

138

28.

Q uestion:

I f th e c o l l e g e / u n i v e r s i t y - b a s e d model were s e l e c t e d
and implemented a t t h i s I n s t i t u t i o n , what o r g a n iz a tio n a l
u n i t o r u n i t s w ith in t h i s c o l l e g e / u n i v e r s i t y should
a d m in is te r th e program?

Answer
a.
b.
c.

E x is tin g o r porposed u n i t in
c o lle g e /s c h o o l
C ontinuing e d u c a tio n d i v i s i o n
O ther u n i t

Number

P e rc e n t

7
4
2

53.8
30.7
15.3

139

CONCERN:
29.

THE TYPES OF BUSINESSES THAT SHOULD RECEIVE ASSISTANCE

Q uestion :

In view o f th e l i m i t e d re s o u rc e s a v a i l a b l e to a s s i s t
small b u s in e s s e s , do you th in k t h a t 1 t would be neces
s a ry t o p r i o r i t i z e th e t a r g e t groups w ith in th e small
b u sin e ss s e c t o r t h a t would be r e c e iv in g a s s i s t a n c e o r
should th e program remain open-ended?

Answer
a.
b.
30.

Number

Program should be t a r g e t e d
Program should be open-ended

Q uestion :

b.

c.
31.

Number

New b u s in e s s e s
- new b u s in e s s e s w ith high
growth p o t e n t i a l
E x is tin g b u s in e s s e s
- l a r g e r small b u s in e s s e s w ith
f o u r o r f i v e s t a f f f u n c tio n s
- c a t e g o r i e s o f b u s in e s s e s t h a t
a r e d e c lin in g due t o a s h i f t
in m arket p o t e n t i a l
- m anufacturing firm s t h a t
"ex p o rt" p ro d u cts
D o n 't know

Q uestion:

6 1.5
38.4

P e rc e n t

3

23.0

5

38.4

3 8.4

How would you c h a r a c t e r i z e th e kinds o f b u s in e s s e s t h a t
should r e c e iv e low p r i o r i t y ?

Answer
a.
b.
c.
d.

5

How would you c h a r a c t e r i z e th e kinds o f b u s in e s s e s t h a t
sh ou ld r e c e i v e high p r o p r i ty ?

Answer
a.

8

P e rc e n t

B u sinesses t h a t a r e f a i l i n g
Ma and pa b u s in e s s e s
Non-manufacturing
D o n 't know

Number

P e rc e n t

4
2
1
5

30.7
15.3
7 .3
38.4

140

CONCERN:
32.

THE RESOURCE REQUIREMENTS AND FUNDING ARRANGEMENTS FOR
INITIATING A SMALL BUSINESS ASSISTANCE PROGRAM

Q u estio n:

In yo u r o p in io n , what would be th e s t a f f i n g req u irem en ts
f o r o p e r a tin g a small b u s in e s s a s s i s t a n c e program?

Answer
a.
b.
c.
d.
e.
f.
33.

Number

Program d i r e c t o r
S e c r e ta r y
One t o two p r o f e s s i o n a l s
Three to f o u r p r o f e s s i o n a l s
P a r t- tim e f a c u l t y
Advisory committees

Q uestion:

34.

Number

Business g e n e r a l i s t s
T r a in in g s p e c i a l i s t
M arketing s p e c i a l i s t
Accounting s p e c i a l i s t
P rod uctio n s p e c i a l i s t
Community development s p e c i a l i s t
D o n 't know

Q uestion:

35.

Yes
No
Not s u re

Question:
Answer
Yes
No

8
1
1
1
1
1
2

Some Small B usiness Development C e n te rs
to augment t h e i r c a p a c i t y f o r p ro v id in g
a s s i s t a n c e by dev eloping an a f f i l i a t i o n
S e rv ic e Corps o f R e tir e d E x ecu tives and
Corps o f E x e c u tiv e s. Do you th in k t h i s
a c t i o n you would want t o pursue?

Answer
a.
b.
c.

5 3 .8
46.1
76.9
7.0
15.3
7 .0

What kind o r kinds o f e x p e r t i s e sh o u ld be r e p re s e n te d
on th e s t a f f ?

Answer
a.
b.
c.
d.
e.
f.
g.

7
6
10
1
2
1

P e rc e n t

P e rc e n t
61.5
7 .0
7 .0
7 .0
7 .0
7 .0
15.3
have attem p ted
c o n s u ltin g
w ith th e SBA's
th e A ctiv e
i s a co u rse o f

Number

P e rc e n t

10

76.9
7 .6
15.3

1
2

Should th e program be d esig ned to become s e l f s u p p o rtin g w ith in a given amount o f tim e?
Number

P e rc e n t

8

61.5
38.4

5

141

36.

Q uestion:
Answer
a.
b.

Yes
No

Should i n s t i t u t i o n a l funds be r e q u ire d t
s t a t e ' s funds?

match th e

Number

P e rc e n t

8
5

61.5
38.4

142

CONCERN:
37.

THE APPROPRIATE STRUCTURE FOR ADMINISTERING AND COORDINATING
A STATEWIDE PROGRAM

Q uestion:

Assuming t h a t f e d e r a l a n d /o r s t a t e funds were a v a i l a b l e
t o e s t a b l i s h s e v e ra l c o l l e g e / u n i v e r s i t y - b a s e d small
b u s in e s s a s s i s t a n c e programs in M ichigan, th e adm inis­
t r a t i o n and c o o r d in a tio n o f th e s e programs could be
achieved in v a rio u s ways. Three p o s s i b l e approaches
t h a t have been c o n s id e re d a r e : (1) t o c o o rd in a te
th e program through a s i n g l e , le a d i n s t i t u t i o n o f
h ig h e r e d u c a tio n ; (2) t o c o o rd in a te th e program through
a consortium e s t a b l i s h e d by th e p a r t i c i p a t i n g I n s t i ­
t u t i o n s ; o r (3) t o c o o rd in a te th e program through a
s t a t e agency such as th e Michigan Department o f
Commerce's O ffic e o f Economic Development. Given
th e s e a l t e r n a t i v e s what would be yo ur f i r s t , second
and t h i r d ch o ices in o r d e r o f p r i o r i t y ?
Number

P e rc e n t

S in g le le a d i n s t i t u t i o n
F i r s t ch o ice
Second ch o ice
T h ird ch o ice

3
2
5

2 3.0
15.3
38.4

Consortium
F i r s t ch o ice
Second ch o ice
T h ird ch o ice

2
3
3

15.3
23.3
23.3

S t a t e agency
F i r s t ch o ice
Second ch o ice
T h ird ch o ice

7
2
1

5 3 .8
15.3
7 .6

U ncertain
No f i r s t ch o ice given
No second c h o ice given
No t h i r d ch o ice given

1
6
4

7 .0
46.1
30.0

Answer
a.

b.

c.

d.

143

38.

Q uestion:

What a r e th e advantages and d isa d v a n ta g e s you see r e ­
l a t e d t o : (1) c o o r d in a tin g th e program through a
s i n g l e , le a d i n s t i t u t i o n ? (2) c o o r d in a tin g th e program
through a consortium ? (3) c o o r d in a tin g th e program
through a s t a t e agency?

Answer
a.

Number

S i n g l e , le a d I n s t i t u t i o n
Advantages
- more economical
- a l a r g e , le a d i n s t i t u t i o n
would have more re so u rc e s
- academic a d m i n is tr a t o r s
would be r e l a t i n g to aca­
demic a d m in i s t r a to r s
- t h i s would p erm it f i x i n g
of re sp o n sib ility
- v i s i b i l i t y w ith b u sin ess
community could be c l e a r l y
esta b lish e d
Disadvantages
- would g iv e to o much c o n tro l
to one i n s t i t u t i o n
- no s i n g l e I n s t i t u t i o n has
e s t a b l i s h e d I t s e l f as a
le a d e r in a re a o f small
b u s in e s s
- would c r e a t e unnecessary
c o n flic ts
- th e le a d i n s t i t u t i o n would
have to c r e a t e working r e ­
la tio n sh ip s
- would p la c e a m ajo r, new
r e s p o n s i b i l i t y on one i n ­
s titu tio n

b.

Consortium
Advantages
- re s o u rc e s could be h arn essed
by common g o als and o b je c ­
tiv e s
- academic a d m i n i s t r a t o r s would
be r e l a t i n g t o academic ad­
m in istra to rs
- could determ ine s p e c i a l i z e d
i n s t i t u t i o n a l r o le s and e s ­
t a b l i s h a r e f e r r a l mechanism

P e rc e n t

1

7 .0

1

7 .0

1

7 .0

1

7 .0

1

7 .0

2

15.3

1

7.0

1

7.0

1

7 .0

1

7.0

1

7.0

1

7 .0

1

7 .0

144

Answer
Pi sadvantages
- I n s t i t u t i o n s a r e too com­
p e t i t i v e ; to o much In ­
f i g h t i n g would ta k e p la c e
- I n t e g r a t i n g re s o u rc e s would
be d i f f i c u l t
- would be more expen siv e:
s t a f f p lu s overhead c o s ts
- would be too d i f f i c u l t t o
a d m in is te r
- would s t i l l r e q u i r e one la r g e
i n s t i t u t i o n t o ta k e th e I n i t ­
i a t i v e - which probably
w o u ld n 't happen
c . S t a t e agency
Advantages
- could fu n c tio n as an o b je c t i ve b ro k er
- has an overview o f th e s t a t e ' s
needs
- could e n su re d i f f e r e n t i a t i o n
of in s titu tio n a l ro le s
- OED a lr e a d y has c o n t a c t w ith
th e b u s in e s s community
- could o p e r a te as a s ta te w id e
r e f e r r a l c en ter
Disadvantages
- would expand s t a t e bureaucracy
- funding c o n t i n u i t y c a n ' t be
g u aran teed
- non-academic ag en cies d o n 't
u n d erstan d environment o f
academic a d m i n i s t r a t o r s

Number

P e rc e n t

3

23.0

2

15.3

2

15.3

1

7 .0

1

7 .0

2

15.3

2

15.3

2

15.3
7.0
7 .0
7 .0
7 .0
7 .0

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