We have all heard the growing chorus of faculty debating the proper role, if any, for teaching business plans. A valid criticism coming out of this debate is that the way business plans have been traditionally taught results in well-written “works of fiction.” Students are told to come up with an idea, do extensive research, and write a comprehensive business plan.

A way that can improve the validity of the business plans is to recognize that the traditional approach misses a critical step in the business planning process. We are learning from our study of successful entrepreneurs that most engage in a step between assessing the opportunity and writing the business plan where they test and develop the business model.

A business model adds more detail to the evaluation and begins to make sure all of the moving parts of the business work together. It tests the internal logic of the business. But it does all of this without moving directly into the rigor and detail of the formal business plan.

The challenge in teaching about business modeling is that it has tended to be understood as a rather vague and intuitive process.

However, there is now a business modeling tool that works for both practitioners and for those of us who teach entrepreneurship. It was developed by lead authors Alexander Osterwalder and Yves Pigneur. They integrated the best practices of 470 practitioners from 45 countries to develop a tool to improve the process of developing business models. More information can be found at their website: www.businessmodelgeneration.com. This Web site contains a large amount of free information on business modeling.

We will be offering classroom exercises and assignments that build off of this approach to business modeling in coming issues of this newsletter.

I was in a meeting the other day with Germain Boer, Director of the Owen Entrepreneurship Center at Vanderbilt University, and a group of Nashville entrepreneurs. Several of the entrepreneurs in the meeting said that before they started their ventures, they had taken their ideas into Boer’s MBA entrepreneurship class and pitched it to his students as a living case study. There was agreement among the entrepreneurs that the students had asked some of the toughest questions and offered the best feedback they had gotten from anyone during the early stages of bringing their ventures toward actual launch.

Boer’s students act as investors hearing the entrepreneur’s idea being presented. They are told to ask probing questions, looking for possible flaws in the business model.

Then when it comes time for students to make their own “pitch” in class, they have had the opportunity to learn from observing and evaluating actual entrepreneurs making their pitches.

It is common to have living case studies of operating entrepreneurial ventures in our classes. Using aspiring entrepreneurs offers a twist that puts the students on the other side of the table for the initial pitch of a new business idea.

James Levin, Director of the Center for Entrepreneurship at College of Wooster, uses a speed dating kind of exercise to help teach students about how to gather information while networking.

Levin believes that one component of successful entrepreneurship is simply using resources garnered through networking. The key is to avoid the common tendency to want to control conversations with others. Instead, his exercise helps to force the students to be open and really listen to what the other is communicating in terms of interests, connections, passions, ideas, etc.

The exercise itself is very simple. Place pairs of chairs facing each other, positioned 4 feet apart in a line (one half the chairs facing one way, the other half facing them, front against front). One half of the students, the “stayers,” sit in one row of chairs, facing the now empty chairs. The other half of the students, who are the “movers” in this exercise, then seat in the empty chairs.

Each pair of students has one minute to talk. They must share information about their passions, hopes, dreams, favorite places, hometowns, and so forth. But since they only have one minute and each student must share information with the other, they should be very aware not to hog the speaking time. After the one minute each of the “movers” moves on to the next chair. The “stayers” stay put. Continue the process until each “mover” has spoken with every “stayer.”

Then move the chairs back for general class discussion of the exercise. Lead the discussion by using creative categories to place classmates within, such as:

Once students are identified for each category by their classmates, drill down further and ask, “Why? What did you learn about the student to make this judgment, to give you this opinion?”

Levin finds this to be a good exercise for early in the semester. In addition to sharpening the students’ networking skills, the exercise also sets a tone in the class for keener observation, better listening, and most importantly, improved self-awareness.

Speaker series can help build visibility and better connect entrepreneurship programs with the community.

At Minnesota State Community and Technical College, in Detroit Lakes, MI, Business and Entrepreneurial Services Director Beth Pridday has used a $7,500 Elevator Grant received from the Coleman Foundation at the 7^thAnnual NACCE Conference to support a Three-Part Speaker & Educational Series for local and regional business people and entrepreneurs.

Previously, speaking events offered by the Business & Entrepreneurial Services Center were offered free to attendees. Feedback from last year’s attendees, however, indicated that people wanted more – smaller group discussions, the opportunity to have their personal questions answered, and more education versus lecture. So Pridday decided the speaker series for the 2009/2010 school year would feature three free events and six for which a small fee would be charged. Also, fee-based workshops immediately following some events were added for those who wanted to go deeper on a topic.

“Our Coleman funds will be used to pay speakers and also to assist with advertising costs,” says Pridday. “Up until this point, we have had 'free' community based speakers and have used a combination of 'free' media and other grant and internal sources to fund our limited paid advertising. With the Coleman grant, I was able to pay stipends to regional and nationally known speakers and spend some needed dollars on marketing as well to continue to grow our attendance. Our Speaker Series continues to be the 'connection' to the community and has acted as a feeder for our PEV course, our non credit workshops, our incubator tenants (two currently reside because they came to Speaker Series) and also elevates us to a regional resource for entrepreneurs and small business owners.”

An affordable fee structure was set for the speaking series. People could attend all six paid events for $50, four events for $40, or could pay $15 at the door for any one event. While attendance at some of the fee-based events was lower than at the free events, the feedback from attendees was extremely positive, with people saying they like the smaller groups better because it supported more discussion. The post-presentation workshops were well attended and garnered very positive feedback as well.

In the end, a total of more than 1,000 people attended the nine speaker and workshop events. The flyer for the entire series can be viewed here.

Click here to see all new and recently posted positions. Send your Entrepreneurship faculty listings to Jeff Cornwall for a free listing at our site.

It is time to get your submissions ready for USASBE 2011, which will be in Hilton Head, South Carolina.The website for paper submissions is now open. To see a full list of conferences, grants, calls for papers and competitions click here. For a free listing of your event or grant, or to announce a “Call for Papers”send your listing to Jeff Cornwall.

Please forward this newsletter to your friends or colleagues who teach entrepreneurship or are interested in teaching this rapidly growing discipline. And encourage them to register for their own subscription here.We don't want anyone to miss out.