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Journal of Education for Business

ISSN: 0883-2323 (Print) 1940-3356 (Online) Journal homepage: http://www.tandfonline.com/loi/vjeb20

The Public Business School in Economic
Development: Preferences of Chamber of
Commerce Leaders
Paul Bacdayan
To cite this article: Paul Bacdayan (2002) The Public Business School in Economic
Development: Preferences of Chamber of Commerce Leaders, Journal of Education for
Business, 78:1, 5-10, DOI: 10.1080/08832320209599690
To link to this article: http://dx.doi.org/10.1080/08832320209599690

Published online: 31 Mar 2010.

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Date: 12 January 2016, At: 23:40

The Public Business School in
Economic Development:
Preferences of Chamber of
Commerce Leaders
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PAUL BACDAYAN

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University of Massachusetts-Dartmouth
Dartmouth, Massachusetts


P

ublic business schools are educational institutions devoted primarily to teaching and research. However,
the mission statements at many statefunded schools also promise to assist in
the community’s economic development. These promises are potentially
risky. They invite the local business
community to expect that schools will
respond to the community’s preferences, even if those preferences have
relatively little to do with teaching and
research. If the community is disappointed by the school’s contributions to
the community’s economic development, the school’s credibility may suffer. In extreme cases, such disappointment could harm the school by eroding
financial support from legislators and
philanthropists.
In this study, I gathered data on the
business community’s preferences
regarding potential economic development activities that public business
schools could adopt. For schools contemplating a community survey as part
of the self-assessment mandated by the
American Assembly of Collegiate

Schools of Business (AACSB), my
results provide a preview of likely
response patterns. I also offer practical
suggestions for meaningful community
outreach, along with suggestions for
future research into faculty views and
best practices at successful schools.

ABSTRACT. In this article, the
author surveyed chambers of commerce in the New England region to
investigate their opinions of the role
that public business schools should
play in regional economic development. Although schools typically
emphasize the mission elements of
research and teaching, the respondents
tended to express greater interest in
the capability of schools to offer technical assistance and adultkontinuing
education. The author offers recommendations for schools wishing to
develop a meaningful involvement in
economic development.


research by professors. But how does
the community regard other activities?
Does applied research contribute as
much to economic development as, for
example, direct technical assistance?
Does education for traditional students
contribute as much as education for
adult workers? Community perceptions,
if documented, can help a school set priorities for economic development.
Thus, I explored the following research
question: “What activities do community business leaders regard as most useful for economic development?’

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Research Objectives and
Background
Public business schools are, above all,
schools. They naturally allocate most of
their resources to teaching and research.

Because resources for economic development are limited, schools may need to
set priorities to focus their economic
development efforts. One input for setting priorities is information about community preferences. Accordingly, in this
study I sought to quantify community
preferences regarding (a) which activities
schools should pursue, (b) which clienteles schools should serve, and (c) what
kinds of staff schools should provide to
carry out the work.
Choosing Activities

Choosing Clienteles

A school’s activities benefit different
parties. For example, teaching activities
often benefit traditional undergraduate
students seeking to obtain a business
degree before beginning their careers.
But who are the most important clienteles for economic development? The following three possible clienteles are
mentioned in literature on business
schools and economic development:


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The local business community probably does not put a premium on basic

1. established firms and working
adults
2. disadvantaged communities
3. emerging new industries

Helping established j r m s and workers.
Lynton (1995) has presented the case in
favor of faculty’s professional service to
September/October 2002

5

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ticular might be targeted; evidence has

been found that university research
spending benefits smaller firms more
than large ones (Acs, Audretsch, &
Feldman, 1994; Link & Rees, 1990).
If a school decides to focus its economic development efforts, it would
benefit from knowing which clienteles
the business community regards as most
important for economic development.
Thus, I formulated another research
question: “What priority do community
business leaders attach to the needs of
traditional students, adult learners,
established businesses, new industries,
and disadvantaged populations?’

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the community in the form of technical
assistance. Lynton has also stressed the
importance of continuing education

(Lynton, 1984; Lynton & Elman, 1987)
for maintaining the economic competitiveness of the workforce. Adult learners, especially those seeking enhanced
business skills, represent a potentially
vital part of the community.

Helping the disadvantaged. This
approach is epitomized by the Metro
Schools group at recent AACSB conferences. Composed primarily of urban
schools, the members of the Metro
Schools group have each focused their
efforts on boosting their often-depressed
communities (AACSB, 2000). Activities
include technical assistance to minority
businesses, applied research on policy
and planning, and educational outreach
to disadvantaged populations. Porter
(1995) noted that urban communities
have some inherent competitive advantages for economic development, including central location. However, such
development requires support in the
form of education, research, and technical assistance.


Promoting new industries. Much attention has been given to special high-tech
regions such as Boston’s Route 128
(Dorfman, 1983; Saxenian, 1985), Silicon Valley (Hall & Markusen, 1985),
and the Research Triangle at RaleighDurham-Chapel Hill. One key finding
about these high-tech regions has been
the importance of the agglomeration
effect, or the notion that these regions
require a critical mass of universities,
high-tech companies, skilled labor, and
companies that offer support services
(Varga, 2000). Universities with industry links are a key element (Chmura,
1987), and business schools could, in
theory, play a supporting role in the
agglomeration process. Faculty members could conduct applied research that
informs policy decisions. Continuing
education programs might focus on
boosting the technical sophistication of
the area workforce. And in the realm of
technical assistance, the schools could

help firms that commercialize university-originated technology (perhaps in
conjunction with university-affiliated
business incubators). Small firms in par6

Choosing a StafJing Approach
Regardless of which activities and
clienteles a school emphasizes, implementation requires staffing. Because faculty time is limited, the school may supplement its faculty members with
specialists who focus exclusively on
adult education, applied research, or
technical assistance. The staffing issue
presents schools with yet another important choice, which led to my final
research question: “Do faculty members
need to render all services, or can schools
outsource certain development activities
by using nonfaculty individuals?’

Research instrumentation and
Method
I surveyed local business stakeholders to obtain their views on this issue.
The survey respondents were the heads

of chambers of commerce and the directors of Economic Development Organizations. By virtue of their positions,
these respondents had informed views
regarding the usefulness of various initiatives for business development. Both
groups also represented the kinds of
stakeholders that a school might turn to
when assessing its effectiveness at contributing to economic development.

identified major possible ways for
schools to become involved in local
economic development (e.g., training
the existing workforce), along with
obstacles to school involvement (e.g.,
attracting faculty involvement).
The survey items described possible
business school activities related to economic development. Respondents used
7-point Likert-type response scales to
rate the usefulness or acceptability of
each item from the standpoint of economic development. After pilot-testing
the survey for clarity by administering it
to a dozen colleagues and local business
owners, I made revisions; the final version took approximately 5 minutes to
complete. In a cover letter, I asked
recipients to draw on their understanding of the local business environment in
their rating of the usefulness of various
activities.
The survey mailing list consisted of
over 400 organizations listed in the New
England region of the 2001 Chamber of
Commerce directory (Worldwide Chamber of Commerce Directory, 2001). I
selected the New England region
because it includes the state where my
university is located. I sent an initial
mailing in October 2001 and a followup mailing around Thanksgiving.
Excluding those surveys returned as
undeliverable,
405 organizations
received a survey. Usable responses
totaled 142, yielding a response rate of
35.1%. In Table 1, I give the number of
respondents for each state in the New
England region. I found only minor differences between chamber of commerce
respondents and economic development
organization respondents, so I report
their responses together. No significant

TABLE 1. Respondents by
State

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No. of

State

CT

respondents

Response
rate (%)

19
36
33
23
12
19
142

21
32
41
33
44
36
35

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Journal of Education for Business

Survey Description and Sample

I originally developed the survey
items through discussions with five
deans, each of whom had led a public
business school’s efforts in local economic development. The discussions

MA
ME
NH

RI

VT

Total

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demographic differences were found
between respondents and nonrespondents. Fifty-eight percent of the individuals on the mailing list were men, and
42% were women; the respondent sample was 63% men and 37% women.
Through a chi-square test, I found that
these percentages were not significantly
different 0,= .14). The average size of a
nonresponding Chamber was 498 members, whereas the sample reported an
average membership of 509. I performed a t test (independent samples, 2tailed, p = .35) and found that this difference was not significant.

hypothesis to determine which activities
stood out from the rest. In Table 2, a t
statistic larger than k1.96 indicates that
the activity was different from the grand
mean at p I.05.

was “fellow scholars,” who benefit
from basic research conducted by a
school’s faculty members. The remaining groups’ ratings were not significantly different from the overall mean
of 5.15. In Table 3, I compare measures
of usefulness for seven possible client
groups. The measures in Table 3 were
based on the items previously presented in Table 2. For example, I calculated the measure for “working adults” by
averaging the ratings for degree pro-

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Findings

Preferred Activities
Respondents were presented with 11
potential school activities and were
asked to rate how much each activity
would help their local economy. In
Table 2, I show the individual activities
grouped into the categories of technical
assistance, teaching, and research. It
should be noted that the respondents
gave generally favorable ratings (5 or
above on a 7-point scale) to most of the
activities. Given that almost all activities were viewed as more than “somewhat useful,” the challenge was to identify which of the 11 items stood out
significantly in terms of desirability.
The technical assistance items
received the highest average rating
(5.62, with 7 representing very helpful).
The teaching items received the next
highest rating, with an average rating of
5.42. The research items received the
lowest ratings, with an average of 4.82.
Statistically, five activities stood out as
top priorities. These included all three
items for technical assistance and the
two adult education items. The two
activities that stood out as having the
lowest priority were applied research on
the needs of disadvantaged populations
and basic research for an audience of
fellow scholars.
I determined the statistical significance of differences among the ratings
through hypothesis testing. For each of
the 11 activities, the null hypothesis
(H,) was that the average rating equals
the grand mean for all of the items
(5.26). I used the grand mean as the null

Preferred Clienteles

The respondents assigned top priority to three groups of clients: working
adults, new industries, and existing
businesses. The lowest priority group

TABLE 2. Respondent Ratings of Activities ( N = 142)

Activity

M

Technical assistance items
Technical aid to new businesses, including start-ups
Technical aid to existing businesses
Technical aid to underserved businessesb
Average for all “service” items
Teaching-related items
Degree programs (BNMBA) to existing adult workforce
Nondegree training (professional skills) to existing workers
Degree programs to underserved andor disadvantaged
populationsb
Degree programs to new graduates (entry level)
Average for all “teaching” items
Research-relateditems
Applied research benefiting new firmshndustries
Applied research on problems of well-established local firms
Applied research on needs of disadvantaged populationsb
Basic research for an audience of fellow scholars
Average for all “research” items
Grand mean (average of items 1 through 11)

ta

5.73
5.62
5.51

4.67*
3.59*
2.54*

5.70
5.57

4.95*
3.04*

5.26
5.16
5.42

0.05
-0.94

5.46
5.34
4.69
3.80
4.82
5.26

1.80
0.78
4.92”
-13.01*

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a2-tailed test, H,: mean for item equals grand mean of 5.26. Items were rated on a 7-point scale, with
7 = most useful. bllnderserved businesses are defined as firms not adequately served by private sector consultants, including small businesses. Disadvantaged populations are defined as those not adequately served by private colleges, including low-income, minority, or first-generation college students.
*Significantly different from the grand mean at p I .05.

TABLE 3. Respondent Ratings of Clienteles

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Clientele

Itemsa

M

fb

Working adults in current workforce

4,5
1, 8
2,9
6
7
3, 10
11

5.64
5.59
5.48
5.26
5.16
5.10
3.80
5.15

6.12*
4.94*
3.89*
1.13
0.10
-.49
-12.02*

New industrylbusinesses

Existing businesses

Underserveddisadvantaged students

Traditional students

Underserveddisadvantaged businesses

Other scholars
Grand mean, all clienteles

aThese item(s) from Table 2 were used to calculate the clientele’s rating. b2-tailed test, H,: mean
for item equals grand mean of 5.15.
*Significantly different from the grand mean at p I.05.

September/October 2002

7

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grams and nondegree programs that
serve working adults.

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Preferred Stafing Approaches

Outsourcing is generally acceptable
for the provision of both (a) technical
assistance and (b) nondegree adult education. The use of nonfaculty staff can
allow a school to provide outreach
while still buffering its regular faculty.
The respondents, on average, stated
that they would object if public business
schools were not involved at all in technical assistance (rating = 3.08; see Table
4). In cases in which schools provide
technical assistance, the respondents
indicated that they would not distinguish
between faculty and nonfaculty providers. These results suggest that schools
have the option of outsourcing technical
assistance to nonfaculty experts. Students, however, provide only a weak substitute for faculty assistance. It should be
noted that technical assistance provided
by students under faculty supervision
was rated only 3.93. Hypothesis testing
showed that three of the four items were
significantly different from neutral (i.e.,
4,the scale’s midpoint).
The respondents viewed nondegree
training-for example, evening skill
development seminars for adults in the
workforce-as
an important school
activity. The idea that schools might nut
be involved in such workforce development was rejected, with a very low
acceptability rating of 2.89 (see Table
5). Hypothesis testing showed that the
ratings for all three items were significantly different from neutral (i.e., 4).

tion and research-what they really
wanted from schools was technical
assistance, adult education, and help
with building new industries. In a sense,
they appeared to prefer activities that
boost business profits and growth most
directly. These findings may not overturn prevailing assumptions about what
the business community wants. The
findings do, however, document a serious gap between typical school priorities and those of the business community. This gap challenges schools and their
faculty members to take positive action.
Thus, I sought to identify (a) practical
suggestions for addressing community
preferences and (b) future research
needs.

between what schools offer and what
the community wants. Schools tend to
emphasize research and teaching, yet
the respondents want more than that.
For example, respondents found it
frankly unacceptable for schools not to
offer technical assistance. Similarly,
respondents flatly rejected the possibility of schools’ not contributing to continuing/adult education (professional skill
development for the existing workforce). For schools attempting to work
seriously to reduce an expectations gap,
I formulated five practical approaches
that might be useful. Because schools
tend to evolve incrementally, I present
those approaches in ascending order by
lead time (i.e., the first ones can be initiated more quickly):

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Practical Suggestions fur Handling a
Genuine Risk

The results of my study indicate that
a substantial “expectations gap” exists
____

~~

TABLE 4. Acceptability of Staffing Scenarios for Technical Assistance
Survey item

Technical assistance is offered by the school and is delivered
mainly by outside consultants (nonfaculty) affiliated with a
school-sponsored “business assistance center.”
Technical assistance is offered by the school and is delivered
mainly by the school’s faculty.
Technical assistance is offered by the school and is delivered
mainly by students (working on class projects) under the
supervision of faculty members.
Technical assistance is not offered by the school at all. Instead,
it is left to other organizations (e.g., Small Business
Administration).

Average

t“

4.69

5.85”

4.65

5.71*

3.93

-0.69

3.08

-6.90*

a2-tailed test, H,: mean for item equals 4 (neutral). Items were rated on a 7-point scale, with 7 =
most acceptable.
*Significantly different from the grand mean at p I .05.

Discussion and
Recommendations

TABLE 5. Acceptability of Stafflng Scenarios for Training

It might seem harmless to include
economic development in the mission
of a public business school. However,
the challenge lies in delivering aid that
is meaningful to the community itself,
particularly when the community reads
its own wishes into the school’s promises. Through our survey, we attempted to
quantify the preferences of local business leaders regarding the role of public
business schools in economic development. The respondents appear to have
had no quarrel with traditional educa8

1. Communicate proactively with
business. A school’s leaders can seek to
manage expectations in the business
community. This approach would

Survey item
Training (nondegree) is offered by the school and is delivered
mainly by outside instructors (nonfaculty).
Training (nondegree) is offered by the school and is delivered
mainly by the school’s faculty.
Training (nondegree) is not offered by the school at all.
Instead, training is left to other organizations (public or
private).

Average

tn

4.88

8.67

4.69

6.43

2.89

-8.29

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Journal of Education for Business

I

”-tailed test, H,: mean for item equals 4 (neutral). Items were rated on a 7-point scale, with 7 =

most acceptable.

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explain how the school views its contributions to economic development,
rather than leaving that interpretation up
to the community. For example, schools
can argue that students represent the
school’s best long-term contribution to
the economy (Hoy, 1994). This argument emphasizes the school’s teaching
mission and links it with the goal of
economic development.
2. Cooperate with specialized agencies and schools. Technical assistance
and adult education may already be
available in a community. Rather than
duplicating the efforts of other institutions, a business school might rely in
some cases on referrals or joint projects.
For example, local community colleges
may already be active in providing special programs geared to the needs of
working adults, and many state governments have set up specialized agencies
for workforce development, small business assistance, and economic development (e.g., the Massachusetts Office of
Economic Development). Similarly, the
federal government’s Small Business
Administration supports a network of
Small Business Development Centers
(SBDCs).
3. Explore outside staffing for noncore activities. As noted above, respondents flatly rejected the idea that a
school should have no involvement
whatsoever in adult education or technical assistance. Happily, my findings
also indicate that schools have flexibility in how they staff the delivery of these
services. The respondents are quite
accepting of outsourcing, which buffers
the school’s faculty. Outsourcing could
be accomplished with the help of user
fees (tuition for adult education), special grants, or state funding earmarked
for workforce development.
4. Link the classroom to the community. Activities can include student field
projects in which students serve as consultants under the instructor’s supervision (Roebuck & Brawley, 1996). It
should be noted, however, that respondents rated student-delivered aid as less
desirable than faculty-delivered aid. Further activities might include case studies
on area firms, industry notes related to
the local economy, and cooperative/
internship placements. These activities
may ultimately enrich the local work-

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force by encouraging students to stay in
the area after graduation.
5 . Encourage mission-related intellectual contributions. Planning and policy studies seem like a natural application of a school’s intellectual resources.
Accordingly, individual faculty members might conduct research on regionally relevant policy issues or industries
(Georgianna, 2000; Howard & Herremans, 1988). This approach must, of
course, work within the school’s reward
system. The challenge of measuring
intellectual contributions in terms of
support for the school’s mission has
been discussed in Graeff (1999) and in
Einstein and Bacdayan (2001).
Future Research Needs

To help schools implement development-oriented
missions,
future
researchers should explore how faculty
members and schools view economic
development. For example, research
about individual faculty preferences
would be useful. Since publication of
the Foundation Reports of the late
1950s (Gordon & Howell, 1959; Pierson, 1959), advancement for business
professors has been closely linked to
research productivity. The AACSB’s
new flexibility in allowing schools to
define unique missions (AACSB, 1994)
has created an opportunity for individual schools to once again emphasize
certain areas such as community outreach. However, the academic reward
system may present a serious obstacle to
faculty involvement (Boyer, 1990).
Maskooki and Raghunandan (1998)
found that finance departments offered
virtually no rewards for industry
involvement, despite calls within the
academic finance community for more
faculty involvement with practitioners.
Research is needed to help identify the
faculty’s level of interest in various
development activities and the potential
impact of various inducements.
At the school level, future researchers
could explore best practices at schools
that have successfully balanced their
mission activities. Researchers could
investigate how schools set priorities,
involve faculty, and provide nonfaculty
staff how schools assess their effectiveness in fulfilling their economic devel-

opment mission; and whether some
schools create synergies by integrating
development with teaching or research.

Conclusion

The results of this study show that
local business stakeholders would prefer
that schools allocate resources to technical assistance and adult education. Given
that most AACSB-accredited schools
have limited resources for community
outreach, school leaders must be selective about their investments in economic
development. A public business school
cannot be all things to all people. At a
minimum, school leaders may need to
communicate proactively with the community to manage expectations and raise
awareness of the school’s actual contributions to economic development.
Should the school launch additional initiatives, those in charge should document
the community’s top priorities to focus
and match the school’s resources with
the community’s aims.
We may never be able to prevent
schools from being caught between the
demands of traditional academic concerns and the desires of local business.
But given the potentially serious discrepancy between schools’ efforts and the
preferences of the business community, it
is important for public schools to take
stock of their relations with the community and take positive action to maintain
the schoolxommunity connection.

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REFERENCES
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Journal of Education for Business

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The Journal of Education
for Business readership
includes instructors, supervisors, and administrators at
the secondary, postsecondary, and collegiate
levels. The Journal features
basic and applied researchbased articles in accounting,
communications, economics,
finance, information systems, management, marketing, and other business disciplines. Articles report or
share successful innovations,
propose theoretical formulations, or advocate positions
on important controversial
issues and are selected on a
blind, peer-reviewed basis.