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Enterprise and MBAs
An MBA is the foundation on which Robert Wright has twice built and sold a regional airline. 'It was a changemaker,' he says, reflecting on his experience at Cranfield School of Management 21 years ago. 'I still draw on its lessons every day.'
When he arrived at Cranfield in 1982, he was a disillusioned commercial pilot in his early thirties, seeking an escape from an airline industry in crisis. At first, he found the academic discipline hardgoing, until he realised that an MBA was like flight school. 'You are finding out what you are supposed to do, before throwing yourself on the general public. You quickly discover your limitations.'
As part of his course, he wrote a business plan for a regional airline, which won a prize with the Institute of Directors. Encouraged to turn his idea into reality, he spent 18 months raising £200,000 and then picked up a discontinued route from British Caledonian between Gatwick and Antwerp, which was scheduled to carry 9000 passengers a year. Launching his airline, Air Europe, with one 18-seater, he took numbers up to 30,000. He also picked up a freight contract between Brussels and Luton, which meant taking the seats out of his plane and driving them back to Gatwick around the M25 every night. 'My MBA gave me the confidence to do it,' he says.
By 1988, he had built up the business to a point where ILG Europe bought him out for £6.5m. Three years later, following the first Gulf War, Wright bought the business back for £1. During the 90s, he built up the business again under the brand of City Flier Express. By 1998, it was turning over £120m with 20 airplanes and 900 staff. BA then bought it for £75m and integrated it fully into its own operations.
Having twice been through the complete cycle of creating and selling an enterprise, Wright joined 3i's panel of independent directors and sits on the boards of three companies involved in buses, hospitals and fitness. Now at the age of 56, he has accepted Cranfield's invitation to return as entrepreneur in residence. His advice to students hoping to become entrepreneurs is that they will require four T's: tenacity, timing, teamwork and technique.
According to an exit survey of the 36,000 people who attended the World MBA Tour at the end of last year, 27.3% of all business school applicants would like to emulate Robert Wright and start their own business. The MBA might have originally been designed to produce excellent managers, but it is now also the starting point for entrepreneurial careers as well.
Christina Hartshorn at the Foundation for SME Development at Durham Business School says that the main benefit entrepreneurs will draw from an MBA is confidence. 'After spotting ideas, they have to win the backing of stakeholders, persuading not just investors, but customers and suppliers as well. And then, in a fast-growing business, they will need a holistic view of management disciplines and to be able to pull them all together. That is what an MBA is designed to do.'
At Durham, MBAs can elect to take a course in new value creation. 'It allows a team to generate an idea and test it against the market, before presenting a final report to a panel of internal and external experts. By the end of eight weeks, students certainly know whether entrepreneurial activity is for them or not. They will also have learnt about gaps in their knowledge when they are working on projects for real.'
After working for 30 years with local SMEs, Durham also has a strong foundation in analysing entrepreneurial behaviour not just in start-ups, but also in how entrepreneurs build organisations around themselves.
Nor is the study of entrepreneurial techniques confined to smaller ventures. 'It is possible to be an entrepreneur in a larger organisation,' says Hartshorn. 'Progressive companies know that they cannot stand still, so they are actively pursuing strategic renewal. Our students should be a step ahead, because they realise how difficult it is to capture opportunities without disrupting the core business.'
