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Graduate Business Start-ups Project Report - The Institute for ...

the Institute

for Employment

Studies

Graduate Business Start-ups

Project Report

IES

HR Response to Organisational Change 1


GRADUATE BUSINESS START-UPS

PROJECT REPORT


the Institute

for Employment

Studies

Graduate Business Start-ups:

Project Report

Nii Djan Tackey

August 1999


The report which is thesubject of this review is published by IES as:

Graduates Mean Business, Tackey N D, Perryman S. IES Report 357, 1999

ISBN 1-85184-268-1

THE INSTITUTE FOR EMPLOYMENT STUDIES

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Tel. + 44 (0) 1273 686751

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Copies may be obtained from Grantham Book Services, priced £35.00.

Tel: 01476 541080

Crown Copyright © 1999

The report Graduates Mean Business was produced under contract with the

Department for Education and Employment. The views expressed are those of the

authors and do not necessarily reflect those of the Department for Education and

Employment or any other government department.


Contents

1. Graduate Business Start-up 1

1.1 Introduction 1

1.2 Review of the background 1

2. Aims and Objectives of the Project 3

3. Organisation of the Project 5

3.1 The project team 5

3.2 Project management 5

3.3 Steering group 5

3.4 Methodology used 6

3.5 Expected outcomes 9

3.6 Dissemination strategy 9

4. The Results of the Project 10

4.1 Main findings from the research 10

4.2 Lessons worthy of dissemination 17

4.3 HEI plans to build on the project and outcomes 20

4.4 Possible follow-up of the project 21

Annex 1: Good Practice Guide 22

v


Graduate Business Start-ups

Introduction

Review of the background

This report summarises the work undertaken during the

different phases of the Graduate Business Start-up project. This

work was produced under contract with the Department for

Education and Employment. The views expressed are those of

the authors and do not necessarily reflect those of the

Department for Education and Employment or any other

government department. The Department for Education and

Employment, nevertheless, holds the copyright over all the

materials produced under the project.

Section 1 reviews the background to the project, and places this

exercise within that context.

Section 2 sets out the aims and objectives of the project, as set

out in the HEQED Prospectus.

Section 3 discusses how the project was organised and describes

the methodology employed to achieve the aims of the project.

Section 4 discusses briefly the results of the project; in particular

the extent to which the aims of the project were achieved, as well

as the difficulties encountered in the course of the project. The

section also draws on the previous sections to highlight the

lessons which are worthy of dissemination to researchers

undertaking similar work, and for policy makers in HEIs,

government departments and other funding organisations. The

section concludes by providing suggestions on how to build on

the project and its outcomes.

There is little evidence of the extent to which self-employment is,

or has become, a significant career destination for new

graduates. This, despite the growth in self-employment within

the general population since the 1980s, as well as the changes

that have taken place in the graduate labour market. In

particular, it is increasingly acknowledged that graduates can no

longer expect stability and a linear career progression in large

corporate organisations, and so need to be alert to the growing

range of graduate opportunities, often in non-traditional areas.

Graduate Business Start-ups: Project Report 1


However, the conventional view is that self-employment is a

minority interest involving only a small fraction of new

graduates. This view is based on data produced by HESA which

relate to their initial destination (HESA, First Destination

Surveys).

It is against this background that HEQED’s development

programme on Graduate Business Start-up is timely, as it paves

the way for research into the potential for developing business

start-ups as a first or early career destination for new graduates.

In particular there is a need to examine the extent to which

higher education identifies the existence of such potential, and

provides support and guidance to overcome some of the readily

identifiable obstacles to increasing take up.

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Graduate Business Start-ups: Project Report


Aims and Objectives of the Project

The main aim of the project was to assess the extent of and

potential for graduate business start ups as a significant career

destination, and whether there is a need for this to be reflected

more explicitly in the higher education curriculum. More

specifically, the main objectives of the research, as set out in the

HEED Prospectus, were to:

! Identify the main defining features of graduates who go into

self-employment, in particular their personal characteristics,

family background, degree subject, and type of higher

education institution attended.

! Explore self-employed graduates’ early post-graduation

employment experiences, the different routes into selfemployment

and the key ‘pull’ and ‘push’ factors which

influence a graduate’s decision to set up their own business.

! Investigate the characteristics of the jobs and working

environments of self-employed graduates, including:

occupational group, sector, hours of work, earnings, the

extent to which they regard their work as their main activity

or as part of a portfolio of activities, whether they are in

business on their own or employ others, their satisfaction

with their job (eg whether the job requires graduate level

ability and their skills are utilised to the full) and their future

expectations.

! Identify self-employed graduates’ views on the help higher

education institutions (HEIs) could provide to graduates who

wish to set up their own business, including equipping

students with relevant skills (eg business, enterprise and

career management skills) and providing a range of career

advice and guidance activities.

! Identify and disseminate guidance on good practice among

HEIs in the provision of careers advice, education and

guidance to students seeking self-employment.

The research aimed to provide both quantitative and qualitative

information on the whole graduate ‘self-employment

experience’. The quantitative data would help identify the

patterns of self-employment among graduates who have been in

the labour market for different periods of time. This would allow

us to explore the ‘success’ of early self-employment experiences

and give an indication of if, and to what extent, self-employment

Graduate Business Start-ups: Project Report 3


levels increase over time. At a more detailed level, the

quantitative information would explore other issues such as

graduates’ routes into self-employment, the characteristics of

their jobs, incentives and barriers to self-employment, skill needs

and gaps, satisfaction with their careers and their future

expectations.

Qualitative information was required, on the other hand, to help

focus on the total ‘self-employment experience’. To this end it

was important to seek the views not only of a cross section of

self-employed graduates, but also of key players from careers

services and enterprise support organisations involved in

helping graduates embarking on this course. The objective here

was threefold. First, to gather information which would inform

the design of the graduate survey, and thus provide useful

contextual and in-depth data to complement the quantitative

data. Secondly, to gather information (eg incentives and barriers

to self-employment, skill needs and gaps) which would be used

to develop good practice materials. The third objective was to

use the information-gathering process to identify ‘experts’ for the

Delphi exercise employed for the development of the good

practice materials.

4

Graduate Business Start-ups: Project Report


Organisation of the Project

The project team

Project management

Steering group

The project team consisted of Nii Djan Tackey (IES Research

Fellow and Project Manager), Sarah Perryman (IES Research

Officer) and Helen Connor (IES Associate Fellow). Jim Hillage

(IES Principal Research Fellow) acted as Project Director.

In addition to IES, the University of Sussex Careers Development

Unit (CDU) and the London Institute Careers Service were

involved in the project as partners, with particular responsibility

for the development of good practice materials. These were

intended to draw on the findings of the main research study and

practice elsewhere among HEIs.

The IES Project Manager had overall responsibility for the dayto-day

running of the project and liaison with the DfEE Project

Manager. The Project Director was responsible for overall

quality control, and ensured that the project ran to time and

budget, and also met its objectives. The project team members

had clear responsibilities for discrete elements of the project, and

had regular meetings to review progress and discuss issues

arising from the study. These were fed, together with interim

results from appropriate stages of the project, into Progress

Reports which were then presented at the Steering Groups

meetings. Taken together, the chain of responsibilities formed

the backbone of the IES evaluation strategy for the project, thus

ensuring it was delivered to time, specification and at the level of

quality required.

A Steering Group was formed to oversee the project. The

Steering Group comprised, in addition to the project team, the

Department’s Project Manager (Ron Allen), and the HE adviser

to the DfEE (Dr Myszka Guzkowska). A specialist in small

businesses (Marc Cowling of the Centre for Small and Medium

Sized Enterprises at Warwick Business School) provided

specialist advice. The Steering Group met four times over the

course of the project and deliberated on its various stages. In

Graduate Business Start-ups: Project Report 5


particular, the Steering Group discussed the development of the

research instruments, agreed on timing of delivery of outputs,

and commented on the drafts of reports.

Methodology used

The research methodology used contained a number of elements.

A review of literature and data

A comprehensive search and review of the relevant and

available literature and data on graduate employment and skill

needs was undertaken. The findings from the review informed

and assisted the research design.

Exploratory interviews

There were interviews with a wide ranging list of key opinion

formers and experts, including careers advisers in HEIs,

representatives of AgCAS, TEC-funded enterprise programmes,

and charities and other organisations which provide enterprise

support to young people who want to set up their own business.

The main aim was to explore the respondents’ views on their

experience of graduates going into self-employment, and about

the role of enterprise activities in higher education generally. On

the whole, all the respondents contacted were co-operative, and

provided the project team with detailed information on their

activities, their links with HEIs, as well as their views on

graduate self-employment, and on enterprise activities and

higher education in general. As might be expected, there was

some variation in the range and quality of information obtained

from the key players.

Interviews with self-employed graduates

The main aim of the interviews with the self-employed

graduates was to find out about their self-employment

experience. The information gathered was used as an input to

the design of the research instruments. The IES outline bid for

the study proposed that the respondent self-employed graduates

to be interviewed for this stage of the research, would be

selected from among participants in earlier surveys carried out

by IES for Sussex University and the London Institute. In

practice, it was difficult to contact as many graduates from those

two institutions, as over the elapsed time some had changed

addresses. Consequently, the list of those with whom contact

was possible was supplemented with other self-employed

graduates identified during the exploratory interviews with key

players.

6

Graduate Business Start-ups: Project Report


Postal survey of HE careers services

A list of addresses, including named heads of the services was

obtained from the Directory of Careers Service and used for the

postal survey. The primary objective was to identify and select

HEIs to be included in the survey of graduates. At the same time,

though, the exercise was used to gather some basic information

on the proportion of graduates from different cohort years who

were in self-employment. A total of 152 questionnaires were

administered; and 65 valid and 17 invalid responses were

received, translating into a response rate of 48 per cent. Among

the explanation for non-response and invalid response was the

fact that some of the HEIs were specialist colleges who did not

provide a separate careers guidance service. In other cases too,

colleges had merged with universities, or were part of

universities, and now had a common or shared careers advisory

service.

Notwithstanding these difficulties, the response rate of almost

half of all HEI career services was high for this type of survey. It

was also satisfying, as it included HEIs with higher proportions

of graduates entering self-employment. More importantly, this

census survey enabled the researchers to identify those HEIs

willing to participate in the main survey of graduates.

Postal survey of graduates

This constituted the main data collection element of the research.

It was envisaged that the survey would cover 4,000 graduates

drawn from eight to ten HEIs that would agree to co-operate with

the survey, and could provide a list of graduates according to IES

specification. The intention was that the participating HEIs would

represent a broad, but not necessarily representative, cross-section

of institutions with a higher than average proportion of graduates

entering self-employment.

The HEIs included in the initial samples were self-selecting,

therefore, having indicated their willingness to participate in this

stage of the research from the earlier survey of careers services.

In practice, the HEIs from which the sample was drawn either

had higher than average proportions of graduates entering selfemployment

overall (as was the case of the London New

University and Midlands New University), or had specific courses

from which a relatively high proportion of graduates entered

self-employment (as was the case of the Northern Red Brick

University, Southern HEI and Northern Technical University). It

became apparent early on at this stage that a sample drawn

strictly on the self-selected basis would not generate sufficient

cases for most of the relevant variables required, or allow for

more rigorous analysis of the data generated. Consequently, it

was decided to include only HEIs that indicated their institutions

as a whole, or individual departments or courses, had a higher

than average proportions of graduates entering self-employment.

Graduate Business Start-ups: Project Report 7


As there was still a risk of shortfall in the achieved sample of

self-employed graduates from these HEIs, it was decided to

approach known organisations which provide support for young

people who want to start their own business, and see if they

would be willing to help with the research. A sample of

graduates was drawn from the database of young people, held

by two such organisations, to complement that provided by the

HEIs. A sample of 3,479 graduates was generated to be included

in the survey, as shown in Table 1. Questionnaires were sent out

to all the graduates in the sample initially, and blanket

reminders sent four weeks later. The questionnaire remained in

the field for approximately eight weeks. The survey yielded 656

useable responses, a response rate of 21 per cent.

Development of Good Practice Guide

This aspect of the project was undertaken by the project partners

at Sussex University CDU and London Institute. The Good

Practice Guide (GPG or the Guide) sought to make existing

expertise in provision of support for aspiring entrepreneurs,

more widely available to careers services throughout higher

education. It was intended that some of the information gathered

from the interviews and surveys would be used to develop good

practice materials. Using the Delphi approach, a panel of

‘experts’ (from within and outside HEIs) selected from the initial

interviews would be used to develop further and refine the good

practice materials. It was proposed to use either discussion

groups or postal questionnaires for this stage of the research,

depending on the location and availability of the participants.

Table 1: The composition of the participating HEIs

Institutions/organisations

N

Higher Education Institution

London New University 778

Midlands New University 677

Northern Technical University 330

Northern ‘Red Brick’ University 600

Southern HEI 644

Total 3,029

Enterprise Organisation

Organisation A 200

Organisation B 250

Total 450

Source: IES Survey, 1998

8

Graduate Business Start-ups: Project Report


Expected outcomes

Dissemination strategy

A number of outcomes were envisaged from the project.

! A research report which would provide for the first time,

comprehensive information on the level and patterns of selfemployment

among graduates, variations between different

groups, the circumstances which are more likely to lead to

self-employment, skill and career support needs among selfemployed

graduates, and if and to what extent selfemployment

might become a more important career

destination for future HE leavers.

! Good practice on the provision of careers education and

guidance to graduates potentially seeking self-employment

would be identified and disseminated in the form of a guide

or other materials. These would highlight the lessons and

actions for careers and teaching staff in HEIs. In particular, it

would point to the range of ways that careers services and

academic staff could bring the idea of self-employment to

their students.

! A series of events to raise awareness in HE about the level

and nature of self-employment among recent graduates and

the type of support this group would benefit from.

! Staff from the partner institutions involved in the project

would learn more about self-employment options for

graduates which would positively inform their future

activities (eg research programmes and client advice).

It was proposed that a research report and good practice

materials would be published by IES under its higher education

series. Press releases and the wide circulation of free research

summaries would help maximise the impact of these

publications. In addition it was proposed that:

! copies of the report and good practice materials would be

provided to all HEIs in the UK;

! a forum for HE careers advisors and teaching staff would be

held to launch the research report;

! a series of short and longer articles would be written by

members of the project team for careers, higher education

and TECs publications;

! presentation of papers at national conferences (eg AgCAS

and SRHE conferences) and DfEE and SRHE networks.

Graduate Business Start-ups: Project Report 9


The Results of the Project

Main findings from the research

Overall, the project aims were fulfilled, culminating in a written

research report. Prior to its publication, the final draft of the

report was presented to members of the Steering Group to

comment upon; and their comments were subsequently

incorporated. The final draft was then submitted for peer review

at IES. With the agreement of the Department the research report

was published as an IES report in July 1999, titled Graduates

Mean Business: a study of graduate self-employment and business

start-ups (IES Report 357, ISBN 1-85184-268-1).

The main findings of the project were contained in seven

chapters of the research report.

Chapter 1 provided the general background to the study, and

included the methodology employed to gather the research

evidence. In the main, this included:

! Review of the relevant literature and data.

! In-depth interviews with representatives of careers services,

enterprise organisations and agencies, and self-employed

graduates.

! A postal survey of all careers services in HEIs in England.

! A postal survey of graduates drawn from five HEIs and two

enterprise support organisations.

Chapter 2 looked at issues of definition and methodology when

researching graduate self-employment. One of the principal

issues here was how to define self-employment, and whether

there is a need to distinguish this from business start-up. While it

was relatively easy to identify what self-employment entailed

from the vast amount of literature, there was very little literature

which used the term ‘business start-up’. A useful starting point,

however, was to look at what it was that people did as

entrepreneurs, and the arena in which they operated. From the

literature, self-employment was defined often within the context

of the an individual’s tax arrangement. A number of problems

were seen to arise from this, such as when low paid or low hours

jobs were involved, and people failed to reach the relevant tax

threshold. Business start-up was difficult to define straight-

10

Graduate Business Start-ups: Project Report


forwardly because it could be used to describe two types of

situations, viz:

! the legal form of a business arrangement, such as sole trader,

partnership or company, or

! a process which describes the development process of the life

cycle of a business.

In the specific context of graduate self-employment, one of the

difficulties for research was to find appropriate comparators

against whom to measure the level of activity. An appropriate

comparator could enable conclusions to be drawn about the true

level of graduate self-employment.

Other difficulties encountered in researching graduate selfemployment

were associated with methodology. First, selfemployment

was not considered a static condition or status;

increasingly, for some graduates, it had become part of a

portfolio of career activities. Second, there was constant entry

and exit which made it difficult to measure the true level using a

particular point in time as a point of reference.

Against this background, however, it was possible to arrive at a

working definition of what constituted graduate self-employment

and business start-up. The former referred to graduates who

considered themselves to be self-employed, in the sense that they

had more than one customer or client. The latter referred to

entrepreneurs who complied with the legal forms of a business

arrangement, trading solely, or in partnership, or as a company.

This included people who had started a business, even if they

were now technically employees of that business. But the

definitions excluded people who described themselves as selfemployed

because it suited their sole employers’ tax

arrangements.

Chapter 3 described the characteristics of the graduates in the

sample surveyed. To help assess the likely career patterns of

different types of graduates, the sample was divided into three

distinct groups:

! those who had any experience of self-employment since

graduating;

! those who had considered self-employment as a career option

either on entering higher education, or at the time of

graduation; and

! those who had no interest in self-employment.

What emerged from the analysis of the characteristics of the

graduates was that the level of self-employment among the

purposive sample was high. A relatively high proportion of

graduates had also considered self-employment as a career

option, although they were not yet so at the time of the survey.

Graduate Business Start-ups: Project Report 11


This means, as well, that when these graduates decide to enter

self-employment, they would do so as people who have given

the idea thoughtful consideration. More specifically the survey

showed that:

! Women were more likely than men to have some experience

of self-employment. They were also more willing to consider

a career in self-employment.

! Self-employment was influenced by the degree course. The

majority of those in self-employment graduated in the

creative arts and design.

! There was some association, albeit slight, between degree

class and self-employment. Graduates with better class

degrees were more likely to have experience of selfemployment.

! A family background in self-employment was a significant

factor influencing a labour market status in self-employment.

Chapter 4 focused on the career patterns of the graduates, in

particular their early career experiences. The initial destination

of the graduates, when assessed one year after graduation,

showed that:

! The majority of graduates were in employment as employees;

but one out of every eight was self-employed.

! Self-employed levels varied according to the subject of study;

self-employment was highest among media and film

graduates; self-employment among art and design graduates

was about the average for the sample.

! Self-employment was significantly high among science

graduates, although the numbers involved here were small.

The significant finding here was that although the subject

studied has some influence on self-employment levels, there was

greater willingness by graduates (of all disciplines) to include

self-employment in their portfolio of labour market activities.

Two years on:

! The level of self-employment had increased from one in eight

graduates to less than one in seven.

! There was greater movement from further study into selfemployment,

more graduates with first class degrees made

this transition.

! There was less movement from unemployment into selfemployment.

Three years on:

! The level of self-employment had increased for graduates

who had been out in the labour market that long.

12

Graduate Business Start-ups: Project Report


! The labour market status of all groups of graduates had

stabilised, and there was little variation according to gender,

age or subject of study.

At the time of the survey:

! the majority of graduates were in employment, about threequarters

as employees; and

! two out of every five graduates were self-employed.

The evidence from the analysis of career patterns showed rising

levels of self-employment over time. The level of self-employment

for the sample increased at each successive sampling point, and

was considerably higher in comparison with the graduate

population as a whole. This suggests that self-employment was

increasingly becoming an important career destination for those

graduates. Our findings also showed that the decision to enter

self-employment was taken at an earlier stage in the careers of

graduates. The aspiration for self-employment and business

start-up was also high, and was underlined by the fact that a

significantly high proportion of graduates had a business idea

they would have liked to pursue. But the evidence also pointed

to the fact that aspiration did not necessarily translate into deed.

The issue for policy is to harness, stimulate and nurture the ideas

and translate them into businesses.

Chapter 5 looked at the graduates’ experience in the labour

market, in terms of their jobs and utilisation of their higher

education qualifications in those jobs.

! Job changes were, on the whole, less frequent.

! The majority of graduates worked full time, but the incidence

was highest among graduates with no interest in selfemployment;

by contrast, graduates with experience of selfemployment

were more likely to work part time in their first

job.

! The self-employed graduates were the most transient

employees, and spent the least time working in that capacity.

! Utilisation of degrees varied, although on the whole, the

majority of graduates thought a degree was helpful in getting

their first job.

! The majority of graduates worked in the ‘other services’

sector.

What emerged from the analysis of their employment experiences

was that graduates with no interest in self-employment were

more likely to follow a traditional employment route, with a fulltime

job in a large organisation. By contrast, those with selfemployment

experience opted for smaller organisations.

Importantly, the findings here lend support to our earlier finding

about how graduates make decisions about their careers very

early on and stick to those decisions.

Graduate Business Start-ups: Project Report 13


Chapter 6 presented the data on the sub-sample of graduates

who were self-employed either at the time of the survey, or had

been at any time after graduating with their first degrees.

Analysis of the combination of career profiles of the whole

sample showed the most common career routes of graduates.

! One-fifth of graduates entered self-employment, and this was

their main activity.

! Between four and five per cent of each of the cohorts were in

continuous self-employment.

! More graduates entered self-employment after a spell as

employees than from unemployment.

! There was only little movement out of self-employment.

The graduates in the sub-sample chose self-employment for a

number of factors:

! Independence/autonomy and flexibility were the principal

motivation.

! Financial rewards were not very high on their list of

motivating factors, nor was security of employment.

Extrinsic factors which influenced the choice of self-employment

included:

! Family background, in particular parental influence.

! Work experience, in particular placement in small

organisations.

The graduates were engaged in a combination of activities rather

than only one type of self-employment:

! The most popular form of self-employment was providing

services to customers.

! Production activity was the next most popular, with

graduates producing things to sell.

! Very few worked within a family business.

! There were more women freelancers than men.

! Three in five self-employed graduates worked on their own (ie

with no employees).

! The graduates were significant employers, and had altogether

just under 2,000 employees.

! The majority worked an average of 40 hours a week, but a

small proportion worked in excess of 60 hours.

! Earning levels were skewed; the median annual salary was

£8,000, and three-quarters earned £18,000.

! Variations in earning levels reflected the length of time in the

labour market.

14

Graduate Business Start-ups: Project Report


From their characteristics, two types of graduate self-employment

emerged. One was the self-employed business which was likely

to only support the owner-manager. The second was the new

business start-up with employment growth potential. These

latter were more likely to be started by graduates whose

motivation stretched beyond the immediate, and to the longterm.

The survival rates for these businesses also appeared to be

high, given that their owner managers had been so engaged for

three years or more.

Skills issues were important to the self-employed graduates.

They relied extensively on their innovative and creative skills,

which also they believed they had developed to a considerable

extent at university. Other than this, there were significant gaps

in acquiring and developing generic business skills such as

accounting, book-keeping, product pricing, selling and,

importantly, business planning. The skill deficiencies were

significant constraints on business start-up.

Self-employed graduates relied on a variety of information

sources for business advice and support:

! The initial information sources were in higher education, from

the course and tutors.

! A high proportion of self-employed graduates did not use the

careers service for information or advice.

! The most frequently used formal sources of advice were

banks, solicitors, TECs and Business Link.

! The graduates also relied on more informal sources, such as

family and friends and other personal networks. The latter

remained important to them, and was shown by their

continuing, on-going relationship with these.

! Graduates rated the informal sources as the most useful for

information, and for business advice and support.

! The graduates considered higher education sources, in

particular careers service staff, the least useful for information

on business advice and support.

Taken together, the results from the analyses of skills and

business advice and support pointed to significant gaps between

what self-employed graduates expected from higher education

institutions, and what was actually provided.

The self-employed graduates had mixed views on different

aspects of their careers. Overall, however, they were satisfied

with the way their careers had developed to date. Specifically:

! they were satisfied with the level of responsibility they had in

their self-employment, and the autonomy enjoined with it;

and

Graduate Business Start-ups: Project Report 15


! they were looking to the future with considerable optimism,

and saw their careers continuing in self-employment.

The issue of whether self-employment should be reflected in the

curriculum in higher education was one of the objectives of the

study. Continuing on the theme of self-employment as an

important career destination, Chapter 7 focused on the

contribution that higher education makes towards such a career.

The need for self-employment to be reflected in careers advice

and guidance was considered to be important, particularly as it

is acknowledged to have an impact on determining career choice

and destination. Drawing on a blueprint by Hailey, the study

identified four principal areas where careers advisers in higher

education could play an important role:

! promoting business awareness

! fostering entrepreneurial attributes among graduates

! contributing towards skills training

! helping in business planning.

The specific contribution careers services could make in each

area was considered to depend on three factors:

! Prevailing cultural attitudes and ethos — careers services

were widely perceived by some enterprise agencies as well as

self-employed graduates, to look less favourably on selfemployment

as an important career destination; and this, in

spite of the fact that a majority of the careers services

surveyed indicated it was important.

! Available access to expertise, internal or external — careers

services were perceived to lack expertise in-house to enable

them to provide relevant advice and support for graduates

contemplating self-employment.

! The resources devoted to self-employment — very little of the

resources of careers services was devoted to activities

connected with self-employment.

The conclusion that emerged from the review of careers services

activity was the need to develop expertise among staff to review

and provide access to support, both internally and externally,

that graduates contemplating self-employment would need or

find useful. Although there are examples of good practice, in this

respect, they are too few and far between. The need for good

practice to be more widely disseminated is one of the principal

objectives of this study. To that extent, this research report forms

one part of the study’s dissemination. Good practice materials

have also been developed, drawing on the findings of this study

and practice elsewhere among HEIs, and will be widely

available to practitioners.

16

Graduate Business Start-ups: Project Report


Lessons worthy of dissemination

As might be expected from a large-scale study of this kind, some

difficulties were encountered in the course of the project. Some

of these have been alluded to in Section 3. In the main, they

related to processes, products and outcomes. These are discussed

in detail below.

Qualitative interviews

A great deal of resources (in terms of man-hours) was used in

identifying the key players to be included in the exploratory

interviews. Because there was a concurrent HEQED project on

Graduate Business Start-ups, it was necessary to encourage

participation, whilst at the same time avoiding interview fatigue,

by the two research teams visiting the same respondents. In the

case of this project, it meant excluding representatives of TECs,

Business Links and Enterprise Agencies, where they existed

separately, from these exploratory interviews. This in turn meant

the project team had to contact a much larger sample of

organisations than was anticipated in order to achieve the aims

of that stage of the project.

Although the representatives of the organisations were cooperative

when the initial contact was made, it was not always

possible to determine before the scheduled interviews that the

organisations themselves or the individuals to be interrogated

were actually involved in the provision of support or other

activities relevant for the client group under study, or could talk

confidently about the subject matter under consideration.

Consequently, and as might be expected, there was variation in

the range and quality of information obtained from the key

players. In some cases it was clear that the key players had only

superficial contact with HEIs, as their services were targeted at

different client groups than graduates.

Although much valuable information emerged from the

interviews with representatives of the key organisations, this

was not counterbalanced to the same extent by information from

the perspective of HEIs. The information for the HE sector was

provided by representatives of selected careers services only. It

was not possible to solicit the views of a much broader range of

stakeholders within the sector. Consequently, it was not always

possible to gain a clearer view of what constituted existing good

practice, particularly from HEIs which made special provision or

support for graduates contemplating careers in self-employment.

In some HEIs, too, it was evident that the provision and support

was provided not by the careers services, but individual

departments/faculties. It would have been more helpful, in such

circumstances, to obtain the views from representatives of such

departments about their current practice.

Graduate Business Start-ups: Project Report 17


One way of dealing in future with some of the difficulties

highlighted from this stage of the project would be to undertake

a pre-interview vetting exercise, using a short structured

questionnaire to establish both the organisations’ and the

respondents’ capabilities to provide the required (ie relevant)

information.

Quantitative surveys

We have already alluded to the problems encountered in the

sampling strategy adopted for the survey of graduates from the

HEIs included in the sample. The response from the survey

highlighted some of the difficulties involved in undertaking a

‘longitudinal’ study of this kind. A large number of

questionnaires were returned by the Post Office, where the

intended respondent was no longer at the address to which they

were sent. The highest returns (and hence the lowest response)

were among the oldest graduate cohort. This suggests clearly

that HEIs may have difficulty in maintaining up-to-date

addresses of their past graduates. A study of this kind could be

useful in helping HEIs update their database of alumni if

provision could be made to inform the HEIs of graduates who

cannot be traced at their last known address. To this end, IES

will endeavour to collate the Post Office returns and pass on the

information to the respective HEIs to enable them update their

database accordingly.

In terms of the response rate, it is possible that this could have

been boosted by sending out a second reminder targeted

specifically at the non-respondents. Indeed, a considerable

number of completed questionnaires were returned well after the

survey was closed, but could not be used in the data analysis. In

practice, though, it was difficult to target non-respondents, as

the project team did not have direct access to the addresses of

the graduates. Consequently, it was considered inappropriate to

send out a blanket second reminder.

In future, it would be important for researchers undertaking

such a study to work closely with HEIs, to enable addresses to be

matched to numbered questionnaires which can, subsequently,

be checked off when questionnaires (both completed and

undelivered) are returned. This, in turn, will ensure reminders

are targeted more specifically at non-respondents.

Development of Good Practice Guide

The final product from the development process was intended to

be a document which, among other things, would help raise

awareness among HE practitioners of self-employment, and give

practical advice on better linking with sources of support and

assistance for business start-ups. The methodology adopted for

this stage, the Delphi approach, was intended to ensure that the

final output also reflected the views of a wide range of experts

18

Graduate Business Start-ups: Project Report


and opinion formers. The Guide utilised information gathered

from the interviews and surveys, on the skills identified as

needed by graduates who wanted to start their own business or

go into self-employment, matching these against the provision of

business and enterprise support throughout higher education.

In practice, there were difficulties during this stage of the

project, throwing into relief some of the problems which arise

from working in a research partnership. More particularly, there

were difficulties relating to the timing of delivery and the quality

of output. A number of possible reasons could explain some of

these difficulties, although two stood out clearly. First, it was

undoubtedly the case that the Steering Group focused more of its

attention on the main research and the production of the

research report. As a result, less attention was given to the

development of the Guide, particularly within the (short)

timescale available. Secondly, compared with the main research,

the specification for the Guide did not spell out in detail what

was expected, in terms of phasing of the work and quality of

output. Thirdly, and arising mainly from the two preceding

factors, there appeared to be a misunderstanding on the part of

the partners, of what was required and the amount of work

(man-hours) that this phase of the project demanded.

Consequently, it was not possible for the partners to carry out

the Delphi exercise to the extent that would have elicited a wider

range of views and current practice. This, in turn, meant that the

Guide reflected mostly the partners’ views of limited practice

only.

A draft of Good Practice has now been completed. The results

will form a Working Paper which will be made available to all

HE career services, AgCAS and other stakeholders for more

exhaustive comment. The Good Practice Guide is appended to

this report as Annex 1.

Among the lessons to be learned from this experience is that

successful partnership arrangements require clearly stated

objectives and outputs, and how these are to be achieved. It is

important that project teams, and for that matter steering groups

as well, anticipate the difficulties that are likely to arise from all

aspects of a project, including the ‘minor’ outputs. This is

particularly so where project partners have limited research

experience.

Collaboration and networking

At an early stage of the project, the project team established

contact with other researchers studying the role of TECs and

their partners in supporting graduate enterprise. This

collaboration was helpful, and enabled the project team to

identify, for inclusion in the exploratory interviews,

representatives of TEC-sponsored initiatives aimed at graduates.

This was one aspect of a more formal network (set up by the

Graduate Business Start-ups: Project Report 19


HEQED) of researchers working on a number of DfEE projects

on Graduate Business Start-ups and Creativity & Innovation. As

a concept, the idea of a networking arrangement of this kind was

useful in so far as it raised expectation of exploration of possible

synergies between projects. In practice, the timing of the

different projects was such that it was not always possible to

share the results of research as they emerged, nor to discuss their

implications for other on-going studies. Nevertheless, the

network meetings enabled discussion and drawing up of

evaluation and dissemination strategies for the different projects.

It is likely that as the different projects are completed, common

issues and themes may emerge which will enable the problems

faced by new graduate entrants to business to be addressed

through more appropriate action.

Dissemination

As was mentioned at the beginning of this section, the main

research report was published as an IES report in July 1999,

titled Graduates Mean Business: a study of graduate self-employment

and business start-ups (IES Report 357, ISBN 1-85184-268-1).

Practical difficulties made it impossible to launch the report at a

forum for HE careers advisors and teaching staff, as was

originally intended. Instead, the report was launched with a

press release and circulation of free research summaries to all

national newspapers, specialist business press, and to business

editors of radio and television media. Following its launch, the

report has been given further publicity through interviews on

national radio (BBC’s PM programme) and local television

(Meridian TV).

Copies of the report and good practice guidelines will be given

to all HEI career services. The timing of this wider

dissemination, however, will depend on how quickly the Guide

is developed.

The possibility of presentation of the findings of the research

report at the biennial conference of AgCAS (in September 1999)

was explored, but was found to be impractical, as the theme for

that conference was concerned principally with other issues

concerning higher education. It is still intended that project team

members will write articles for careers, higher education and

other relevant publications.

HEI plans to build on the project and outcomes

It is expected that the outcomes, in terms of the research report

and Good Practice Guide, would be disseminated throughout

the wider HE community. In particular, HE careers services

which have little or no experience of issues of self-employment

among its graduate population would be encouraged to draw on

the findings from the project as a means of addressing some of

20

Graduate Business Start-ups: Project Report


Possible follow-up of the project

the problems they are likely to encounter when providing

careers guidance and advice.

The project has broken new ground by drawing attention to the

fact that self-employment is becoming an important career

destination for new graduates. As a development programme, it

was inevitable that the study was on a comparatively small

scale. There is scope for a more extensive study to be undertaken

to explore in greater detail evidence of self-employment levels

among a more representative sample of new graduates in higher

education throughout the UK. This would provide policy makers

an opportunity to determine the impact of specific regional

factors on self-employment opportunities for graduates. It would

also enable an assessment of whether and how self-employed

graduates differ from the rest. For example, whether there are

likely to be inherent advantages which lead to more successful

business start-ups.

Graduate Business Start-ups: Project Report 21


Annexe 1:

A Good Practice Guide for Higher Education Careers Services

1. Introduction

Background and Purpose of the Guide

2. Existing Provision within Higher Education Careers Services

Current provision, described by Careers Services who

responded to the Graduates Mean Business questionnaire

Provision to raise awareness, and provision to meet the

needs of those already considering self employment

Background to Good Practice

3. Graduates’ Views:

In retrospect what graduates in the study would have liked:

Information, Training, Changes in Cultures

4. Developments Under Way

Points to factors affecting the design of provision and

illustrates the breadth of provision across a range of

disciplines and institutions:

Projects designed to develop Entrepreneurial Skills

Entrepreneurial Skills within Career Management

Programmes

Other Entrepreneurial Activities on Campus

5. Examples of Good Practice: Undergraduate Focus

Institutional and Resource Issues, and Student Attitudes

Career Management & Enterprise Skills and Course Provision

Examples of Good Practice & Possible Models

Use of Information Technology

6. Postgraduate Provision:

Research, Masters and Business ‘Toolkit’.

Organisations offering Training in Business Start-Up

7 Resources Available:

A Review of the Resources available to those hoping to start

their own business

8. Recommendations

Operational & Policy Recommendations for Careers services

in Higher Education, and others.

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Graduate Business Start-ups: Project Report


1. Introduction

This Guide has been produced with funding from the

Department for Education and Employment (DfEE), under the

Graduate Business Start-Up theme of the 1997 Higher Education

and Employment prospectus. It aims to set out for Careers

Services in higher education:

! examples of the provision for business and enterprise skills,

within and without the higher education curriculum, which

have been developed over recent years

! sources of information for students and careers services

! the range of postgraduate provision

It refers to findings from the companion survey undertaken by

the Institute for Employment Studies (IES) for DfEE and

published recently in the report, ‘Graduates mean Business

(Tackey and Perryman 1999). Inter alia, this examined the

provision available to graduates interested in starting their own

business, through both higher education careers services and

other agencies, asked them to reflect on their own experiences

and produced evidence for the characteristics of those who were

successful in establishing their own enterprise.

Self employment, as an immediate or subsequent destination for

graduates, has enjoyed a higher profile over the last few years.

This is the result of various factors including:

! introduction of policies by government to encourage the

establishment of small businesses

! swings in the volume of unemployment experienced by new

and recent graduates

! increase in freelance working and ‘portfolio’ careers

especially in buoyant sectors of the economy eg creative arts,

media, Information Technology.

This has brought fresh challenges to some higher education

Careers Services, notably those with a significant proportion of

students on art, design and computing courses. In some

institutions between 10% and 15% of their graduates may work

freelance or for their own business within a couple of years after

completing their studies. As a result some students are seeking

to explore the implications of working in this way before

Graduate Business Start-ups: Project Report 23


graduation, while others return to higher education Careers

Services in the hope of accessing information about this option.

However, interest in self employment remains patchy across

higher education and only 1% of graduates are recorded as

working this way in the First Destination Survey produced by

the Higher Education Statistics Agency (HESA) and reflecting

the position on 31 December of the year of graduation. This is

reflected in the findings of the survey undertaken by IES into

existing practice by higher education Careers Services. Because

their students express comparatively little interest in self

employment, many services target hard pressed resources at

areas of greater demand. In only a few institutions has there

been extensive provision of information and advice about this

option.

The Good Practice Guide seeks to make careers services

throughout higher education aware of some of these

developments and to offer advice to those services who wish to

expand provision with limited resources. It is clear both from the

results of the research undertaken by IES and from other surveys

that many graduates, interested in self employment, find

difficulty in accessing appropriate support, information and

advice. We hope that our colleagues will find the contents of the

Good Practice Guide helpful in enabling them to cater more

satisfactorily for these graduates within finite resources.

We work in very different institutions — one a university

founded in the Sixties, the other, a federation of five colleges,

specialising in art, communication and design. Although we

have approached this task from different perspectives, we have a

common aim. We are keen to ensure that those of our graduates

who wish to set up their own business — whether on leaving

college or subsequently — can do so successfully. We have both

striven to improve provision for students interested in this

option and see the Good Practice Guide as a way of exploring

ideas and extending knowledge amongst colleagues.

We would like to thank our colleagues from the Association of

Graduate Careers Advisory Services (AGCAS) for their

assistance in compiling this Guide. Their contributions of time,

both to this exercise and the completion of the IES Survey,

expertise in commenting on the draft contents, and

encouragement, have been much appreciated.

Carolyn Morris

Selina Springbett

July 1999

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Graduate Business Start-ups: Project Report


2. Existing Provision within Higher Education Careers

Services

Current provision

In responding to the Graduates Mean Business questionnaire,

Careers Services describe provision

! to raise awareness.

The most common are:

! talks by specialists, such as Business Initiative

! Business Link briefings

! including self employment in Careers Fairs

! workshops run by Careers Advisers

These are mentioned with equal frequency. Others include

careers education options for current students and one day

workshops for past students.

Careers Services often include graduates who have set up their

own businesses in career events. These may be targeted at

specific groups such as a Careers Day for 2nd year

undergraduates in Sussex’s School of Cognitive and Computing

Sciences, where recent graduates who have set up multi-media

and systems companies have been among recent presenters.

These may be part of a mainstream programme of career events:

with speakers from the Prince’s Youth Business Trust, recent

graduates talking through their own thinking and their own

experiences — there are a number of ways in which Careers

Services tackle the questions of raising awareness, and of

providing stimulus and introductory information, people and

resources.

Another approach is to include features on ‘Working for

Yourself’ in vacancy publications, to make sure job seekers are

thinking about the possibility of self-employment as well as

being employed. For example, Sussex University’s graduate

vacancy list ran a feature ‘42 of last year’s Sussex graduates are

working for themselves...’. The article pointed to both expected,

(computer consultant, journalist) and unexpected, (Alpaca stud

Graduate Business Start-ups: Project Report 25


Background to Good Practice

farmer) examples, and ran through: Why Work for Yourself Is

Self-employment for Me Where do 1 start and Finance and

Useful Contacts.

! To meet the needs of those students already considering selfemployment

Careers Services are providing

! information on where to get help

! workshops and presentations

! links with Enterprise Agencies/Business Link

! speakers at Fairs

! individual discussion of plans

! involvement with Young Enterprise

! Alumni databases

! Start your Own Business courses and

! introductions to other staff members in the Institution

with particular links with enterprise.

Traditionally Careers Services have acted as enablers and

facilitators , providing signposting expertise: the knowledge of

where and how it is appropriate to refer students to specialist

agencies. This is particularly salient to the needs of this group,

not least because of the other attributes which would-be

entrepreneurs require.

Perhaps this is not surprising. It’s not thought to be a

disadvantage that Careers Services operate without staff

experienced in the several hundred other career options

available to their student clients. Their professionalism is seen to

lie elsewhere.

Can we learn anything about good practice from our analysis of

the constraints Careers Services reported

Given finite resources, Careers Services have to make decisions

about provision which relate to demand. The concern for Careers

Services is how to balance provision on opportunities most

recognise as important, against the demand from students for

information on other areas. In this context, to most Services it

makes sense to advertise and make links with other agencies in

the community with specialist expertise and resources.

Implications for Careers Services’ Work with Past Students

Graduates Mean Business found many becoming self-employed

after periods of employment/further study. Careers Service

provision for graduates a year or two out is patchy and

26

Graduate Business Start-ups: Project Report


unpredictable. But our evidence suggests there is a substantial

group of graduates who move into self employment some years

after graduation.

For some graduates the idea of becoming self employed comes

only after experience of the work place; for some, the notion has

been around for longer, perhaps since University, developing

with experience of the business world, perhaps in employment

in an SME. It may, as we know from Graduates Mean Business,

be fostered both by good experiences in the work place, and by

bad, frustrating ones.

Some graduates have consciously been garnering skills, as it

might be hard edged skills in knowledge of markets and pricing

strategies; or skills in executing their particular specialism or

discipline, eg web design, in editing text, in manufacturing or in

graphic design. Working in both large and small companies can

provide helpful experience and skills.

When graduates are ready to look for information and support,

then Careers Services may no longer be able to help them,

because they are no longer eligible for their services.

Current proposals by AgCAS and CSU to extend the network of

provision and strengthen Careers Services for graduates in the

early years after graduation are particularly welcome for

potential entrepreneurs, as it seems that this group may be

particularly prone to failing between gaps in provision.

Graduate Business Start-ups: Project Report 27


3. Graduates’ Views: in Retrospect, what they would

have liked

From the survey it is clear there are a number of things

graduates would have liked, though not all of our entrepreneurs

are convinced their skills can be taught.

Information on

how to:

! become self-employed, freelance/contract worker

! apply for funding

! get support, advice once you have left university

! work freelance and ‘how to set up business’

where to learn

! some of the know-how skills, eg how to keep basic books, (as

distinct from those who wanted to be taught those book

keeping skills as part of their curriculum)

Training in specific skills

generic personal and business skills: ‘how to present oneself,

how important it is to get on well with people on a personal

level. This ability got me more work than any skill … skills can

always be learnt but not communication skills in dealing with

people’

! business skills, such as pricing

! IT skills

! selling and marketing

! accountancy

! stress management

! Tax — ‘basic understanding of self employment jargon, ie Tax

codes, NI contributions etc.’

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Graduate Business Start-ups: Project Report


Some want more information on how to apply existing skills

! ‘How to employ the skills we learnt in the business world’

Others would have liked

! individual contacts with ‘‘people doing it now’

! a self-employed version of work experience

! other information inputs on future business activity, pointing

to new markets and changes in the economy affecting

business opportunities.

Another group want changes in institutional cultures:

! ‘The whole ethos of the college was anti-commercialism’. The

notion here is that Universities should be seeking to create

entrepreneurs, rather than being geared to graduate jobs:

! ‘Training people to work for a company, rather than

ourselves’, sums up the critique here.

But it must also be pointed out that there is another view. ‘I

wasn’t actually taught business skills in my degree — and I’m

very glad that was the case. Whilst at university I was active in

creating societies, activities that required ‘business’ skills … for

me this is far more important than ‘teaching’!’

Other unpublished research reinforces much which is reflected

in this survey. However, many graduates recognise that, while

studying, they did not always take advantage of or value the

provision which was available, and that their aspirations,

attitudes and requirements change after leaving education. In

some cases, experience of freelance work or setting up in

business is the trigger for seeking support. One of the issues

familiar to Careers Services is the difficulty of ensuring

appropriate advice, guidance and information is available when

the student or graduate wishes to have access and could derive

maximum benefit.

Graduate Business Start-ups: Project Report 29


4. Developments Under Way: Some Initiatives

Over recent years, a number of institutions have piloted

initiatives which aim to encourage students to identify and/ or

develop entrepreneurial skills through a range of activities. We

have included some examples below which have been selected to

illustrate the breadth of provision available across a range of

disciplines and institutions with contrasting missions and

student populations.

One of the messages from careers and academic staff involved in

developing these initiatives is the importance of ensuring that

provision reflects the aspirations and interests of the students

involved. In practice, this means that provision, whether

embedded in the curriculum or offered as a ‘bolt on’, should be

designed with the following in mind:

! the profile of the student body at the institution

! the discipline base of the students involved

! their learning styles

! their aims and aspirations post graduation

! the structure of the market place which they are likely to

enter.

Some of these themes are explored in subsequent chapters of the

Guide

There are a number of initiatives in existence: here are some

examples of the range of initiatives which are available in Art,

Science and cross-curricular, from a range of institutions.

Projects designed to develop Entrepreneurial Skills:

The Gallery Initiative

This is a University of Portsmouth initiative designed as an

opportunity for students to develop business skills through

managing an exhibition in a gallery Art Design and Media

Illustration students are split into three teams, each supported by

a Business Adviser: a Management Team, Promotions and

Marketing team and an Operations /Technical/Hanging team.

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Graduate Business Start-ups: Project Report


Support includes business seminars and seminars by gallery

managers, team building and business exercises. Advice on

writing a business plan and presentation of team plans are also

involved.

Students are also responsible for generating finance for the

project — through sponsorship or whatever means they identify.

The Biotechnology Young Entrepreneurs Scheme (Biotech YES)

This is a competition developed to introduce students and

researchers in the Biosciences to the commercial potential of

scientific and technological

discoveries and, to the requirements for the development of a

biotechnology company.

It is jointly organised by the BBSRC (Biotechnology and

Biological Sciences Research Council) and the University of

Nottingham. This scheme introduces Bioscience students to the

key business skills important in setting up a Biotech company.

YES begins with intensive regional weekend induction

workshops where teams of undergraduate and postgraduate/

postdoctoral scientists are introduced to the key aspects of

preparing a business plan and setting up a Bioscience company

Postgraduate teams spend a further 2 days developing their

plans, with advice from a team of mentors, and then make oral

presentations of their plans for the start up company to a judging

panel of Venture Capitalists. Undergraduates return to their

universities to prepare written business plans, submitted for

judging after 6 weeks.

Undergraduate and postgraduate teams are then selected from

each of the regions to present their plans. In 1998 teams from the

Universities of Aberdeen, Cambridge, Leeds, Surrey, UCL and

the John Innes Centre, Norwich were invited to present their

business plans at the Postgraduate/postdoctoral final.

Entrepreneurial Skills within Career Management

Programmes

A curriculum based programme developing generic career

management skills with explicit focus on the self-employed

sector is Personal and Professional Development at the

University College of Ripon and York St. John. The modules are

a compulsory part of the College’s combined Honours schemes.

They aim to give students ‘knowledge, skills and experiences

relevant to a variety of careers in the private, public, voluntary

and self-employed sectors ….’

Graduate Business Start-ups: Project Report 31


Studying a business plan is part of what is on offer. There is an

emphasis on experiential learning and skill development, and

students taking responsibility for their learning.

A Revitalised Enterprise Culture

The Chancellor has announced a series of measure designed to

build stronger links between Higher Education and Industry,

through eight 8 new Institutes of Enterprise in Universities. The

government proposes to put £25 million into these.

Incubator Units already exist on a number of campuses: Campus

Ventures is one example. Manchester University’s high

technology business incubator, offering a range of business

support services to start-up businesses. Its mission is ‘to enable

HEIs to play an increasing role in the creation of wealth and

employment through the provision of a place of support, in

which technologists and scientists can develop skills, through

participation in the origination and development of businesses’.

The Sussex Innovation Centre, based on the University of Sussex

campus, was established to encourage and support the creation

and growth of technology-based businesses in the Sussex region.

One aspect of this support is to provide incubator space for new

technology and knowledge-based companies. The aims and

services are typical of many, with customised service, laboratory

space, personnel who can provide technical, management,

marketing and other specialist support, and networking. The

Centre works closely with the Universities of Sussex and

Brighton, Brighton College of Technology, local companies and

individual inventors.

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Graduate Business Start-ups: Project Report


5. Examples of Good Practice: Undergraduate Focus

Institutional Issues

Resource Issues

From the survey of higher education careers services, it is clear

that there is a wide range of activity available across the sector to

those students interested in becoming self employed or setting

up in business after graduation. However this provision is

patchy, delivered by a range of agencies both within and without

higher education, and frequently perceived as of interest to only

a small proportion of the student body.

There are a number of factors influencing the level of provision

at individual higher education institutions, some of which were

identified in ’Graduates Mean Business’.

! mission and purpose of the institution. HEIs cater for different

markets both in terms of students and employers. Some have

a research focus, others a commitment to widening

participation, for example.

! organisation of the curriculum. In the experience of many

careers advisers, it is more feasible to offer explicit enterprise

and career management skills provision as part of a modular

degree scheme.

! attitudes of staff. Some staff see their role in the context of

academic teaching and research based in their own

discipline, with provision for issues germane to

‘employability’ the responsibility of other parts of the

institution.

! Level of Careers Service and other funding. Levels of funding

vary considerably with predictable consequences for the

breadth of provision available.

! Success in attracting appropriate external funding. In a number

of HEIs funding from the Enterprise in Higher Education

Initiative, and recent programmes supported by DfEE, for

example, have facilitated the piloting of career management

and enterprise activities within the curriculum.

Graduate Business Start-ups: Project Report 33


Attitudes of Students

! Some students come to university primarily for an

educational experience or to enhance their creative

development, for instance. Others have more specific aims,

having chosen a course which offers exemptions from

professional examinations or provides a vocational training.

The number of such courses within an institution can

radically affect the culture and therefore the receptiveness to

enterprise provision within the curriculum.

! lack of awareness amongst students about the facilities

available.

! lack of interest amongst undergraduates in these options.

While many consider self employment as a possibility, few

actively explore the implications. In this, self employment is

no different from the number of options which most students

consider and discard or defer until a more appropriate time.

From a number of the responses to the survey of graduates, it

is clear that students are ambivalent about the inclusion of

business options in undergraduate programmes. Some

considered that business options, variously defined, should

be taught as part of their degree, others regarded their time

in higher education as an opportunity to explore exclusively

academic and creative options.

Against this background, a number of HEIs are making useful

provision in support of students’ aspirations to work as

‘entrepreneurs’. In some cases, this has been developed in

partnership with external agencies such as the Prince’s Youth

Business Trust (PYBT) or Shell LiveWire. The ‘Seven Skills of

Enterprise’ identified by the latter have formed the basis of a

pilot project, funded by DfEE, at Camberwell College of Arts.

Creative Futures 2 introduced students to many of the skills

required to work as a freelance practitioner in the creative

industries and included the production of a business plan.

However, even agencies such as PYBT and LiveWire, who were

highly rated in the graduate survey, were used by only between

15% and 40% of respondents. This raises issues about the need

for more effective signposting of the resources available and

possibly a re-examination of the remit and modus operandi of all

the agencies involved and their assumptions about the attitudes

and awareness of potential entrepreneurs.

Career Management and Enterprise Skills

Students have various opinions about the skills, opportunities

and difficulties faced by those seeking to run their own business.

In part this can be seen in the responses to the graduate survey.

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Graduate Business Start-ups: Project Report


This identified two clusters of skills: those which can be defined

as ‘career management skills’ and, as such, are of value to all

students and ‘enterprise skills’, which are of particular interest to

those hoping to establish their own businesses or work as

freelancers. There are various definitions of both career

management and enterprise skills available, including that by

LiveWire referred to above. For the purpose of this Guide, we

have distinguished between the ‘personal’ skills, many of which

would appear on any list of Career Management skills and are

generic, and ‘business’ skills, many of which are technical and

knowledge based.

Course Provision

Provision to enable students to identify and develop career

management skills is becoming widespread. It takes various

forms:

! ‘careers’ modules as a compulsory/ optional part of a degree

programme

! ‘bolt-on’ programmes offered by Careers Services or

departments, often in collaboration

! free standing ‘career exploration’ workshops run by Careers

Services, often in concert with the opportunity to use

Prospect(HE) or similar computer based careers exploration

programmes.

The opportunity to acquire enterprise skills is available to

students in some of the following formats:

! as an accredited module/option in a degree programme

! through workshops offered by Careers Services, sometimes

in collaboration with external agencies

! through programmes run by student societies, eg Student

Industrial Society or external agencies.

The focus of these options can vary from the acquisition of skills

eg book keeping to information about potential sources of

practical support. In some HEIs, students are enabled to identify

and develop the personal skills necessary for success in this

sector eg networking, negotiation, self promotion.

Networking is a good example of a skill critical to success as a

entrepreneur. Learning to use your networks and developing

skill and confidence in so doing can be encouraged and taught.

It’s importance is reinforced by the findings of the graduate

survey where various personal networks and forms of support

were identified as important by respondents.

Graduate Business Start-ups: Project Report 35


Examples of Good Practice

Possible Models

There is some excellent provision in higher, education, which has

certain characteristics:

! relevance to the aspiration of students

! designed and delivered in a manner sympathetic to their

learning styles and the context of their studies

! delivered by staff who are credible in this context, whether

salaried or visiting tutors

! capacity to enable students to identify and develop the skills

required with confidence.

The most appropriate model will vary from institution to

institution. From the survey of Careers Services, the following

merit consideration:

! Enterprise/Entrepreneur Module: usually available to

students in the penultimate/ final year of their programme

with a focus on the identification and development of

various enterprise skills including networking, decision

making; the acquisition of business skills and procedures eg

book keeping, taxation and the production of a business plan

including market research, cash flow forecasts. Such modules

may include scope for appropriate work experience or

mentoring (see below).

! Mentor Schemes: These can link students with self

employed/ small business people with a view to providing

information, guidance and advice. For success, thorough

preparation of both students and mentors is important. The

relationship can be time consuming for both parties unless

clear parameters are established. At the London College of

Printing, students on HND Sound Music Design

Technologies have been linked with mentors from various

sectors of the music industry in London. This has enabled

them to identify and develop some of the skills required to

make a career in the industry with the support and guidance

of established figures.

! Briefing Sessions/Forums: Often by representatives from

Business link, other support agencies and newly fledged

entrepreneurs in attendance. The experiences of the latter are

of particular interest and immediacy to students.

! Fairs: These can bring together the agencies offering support,

alumni running their own businesses, banks and other

experts in an informal setting. They offer a forum both for

those committed to this option and the student undertaking

tentative exploration. The universities of Westminster and

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Graduate Business Start-ups: Project Report


Use of Information Technology

York have run successful fairs for past and present students

interested in different ways of working.

! Alumni Networks: Many universities have established

alumni associations which offer past and present students the

opportunity to make contact with those in particular

occupations. The University of Sussex Graduate Network

brings together those who have established their own

business and offers networking opportunities to recent

graduates.

! Specialist Provision: Organisations such as Workable, Royal

National Institute for the Blind (RNIB), the National

Mentoring Consortium, offer opportunities to students from

particular backgrounds or with a variety of needs. There is

scope for increasing this provision in response to local

conditions through collaboration between the agencies

involved.

Each of these options has different implications for the level of

resources required. One of the dilemmas for many higher

education Careers Services is whether to devote significant

resources to the promotion of those opportunities which are of

immediate interest to a limited number of undergraduates. With

the considerable variation in the provision which individual

HEIs make for past students, there can be difficulties for

graduates in accessing information and guidance.

With the advent of sophisticated information technology (IT)

provision both within higher education and the wider

community, there exists another avenue through which

information — and in some cases advice — can be disseminated

— the Internet.

Increasingly organisations are making available details of the

support, guidance and facilities which they offer through the

world wide web and e-mail query services. With funding from

the Business Start -up theme of the same DfEE initiative, the

London Institute Careers Service has created an ‘Enterprise’

database with details of organisations, predominantly regional

but also national, who provide support of all kinds to students

and graduates interested in business start up. The London

Institute’s specialisation in the fields of arts, communication and

design is reflected in the focus of the database. However, once it

is available through the Careers Service’s web site, its contents

will be widely accessible.

In designing and producing the database, the Careers Service has

encountered one of the difficulties mentioned by respondents to

the graduate survey — the problem of accessing current

information about the organisations active in this field. Since the

Institute started this project, there have been changes in the way

Graduate Business Start-ups: Project Report 37


in which local Business Links operate for example. It proved

challenging for staff, skilled in eliciting information and with a

knowledge of the context, to discover details of the provision

available. In this situation, it is hardly surprising that recent

graduates experience difficulties. One of the unpredicted

recommendations of the report on the Institute’s project will be

that there should be stability in the provision for both graduates

and others seeking to set up in business, both to improve access

and facilitate ongoing qualitative and quantitative evaluation.

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Graduate Business Start-ups: Project Report


6. Postgraduate Provision

Over recent years, there has been a significant increase in the

opportunities to study enterprise and acquire business skills

through higher, further and adult education. The courses

available vary considerably in their aims, focus and content.

There are two broad categories:

! those offering the opportunity to undertake primarily

academic research and exploration ie PhD and Masters

courses

! practical diploma and certificate courses which provide an

introduction to business techniques and procedures.

However, with the introduction of credit rating and transfer, it is

becoming easier for students to move from one kind of provision

to another. Some of the latter now offer a route for students to

move from a practical to a research qualification. With the

current stress on the importance of lifelong learning, it is

increasingly likely that provision of this kind will become more

widely available — not only on a full time and part time basis

but also through distance learning, delivered through a variety

of media.

The current provision can be distinguished as follows,

! Research: the opportunity to undertake research into issues

relevant to small businesses, entrepreneurship, IT and small

firms, self employment etc. This usually leads to PhD/ M

Phil and is available at about 20 universities

! Masters Courses: these vary in content. Many include the

opportunity to study for a postgraduate certificate or diploma,

should students wish to concentrate on the acquisition of

business skills rather than produce a dissertation. About 10

HEIs offer this provision, some of which is targeted at

particular sectors of the economy eg London Institute

MA/PGDip/PGCert. Creative Arts Management. Many of

these courses are available on both a full and part time basis.

! Business ‘Toolkit’: There are a large number of organisations

who offer training to graduates seeking to acquire business

skills. The content of these course — and eligibility — varies

considerably. Nevertheless all are intended to provide

support and business skills eg book keeping, marketing for

those hoping to establish their own enterprise.

Graduate Business Start-ups: Project Report 39


Organisations Offering Training in Business Start-up,

There are a large number of organisations who provide support

and training to enable graduates to acquire a business ‘toolkit’.

The courses can vary in length from a day to several months —

usually on a part time basis in the case of the latter. Many also

provide IT support, office facilities and access to financial and

other practical advice. Some of the most important sources of

help, available nationwide are listed below.

Training and Enterprise Councils (TECs) most TECs provide a

range of services including support for business start-up,

‘Setting Up in Business’ seminars, access to appropriate

expert advice eg finance, law, tax. TECs are likely to

disappear over the next couple of years if the proposals in a

recent White pare are implemented.

Business Link: Government backed, Business links aim to help

businesses of all sizes on a range of issues eg raising money,

arranging training.

Small Business Centres: often connected to Business Links and

TECs, these offer professional advice and help from

counsellors with business experience. They frequently

support business start-up in particular geographical areas

and may have knowledge of local grants and facilities.

Trade Associations/Professional Bodies: many trade associations

and professional bodies offer support and training with a

focus on assistance for new entrants to the market. They will

concentrate on entry to the industry in which they are active.

Areas with a high number of small businesses and freelance

staff eg design, media are well represented.

Prince’s Youth Business Trust (PYBT): one of the largest

organisations in this field, PYBT offers a range of support to

potential young entrepreneurs.

Shell LiveWire: LiveWire provides support and advice to

potential young entrepreneurs and hosts regional and

national events to promote their businesses.

Further and Adult Education Colleges: many colleges offer full,

part time and short courses for local residents interested in

starting their own business. Courses are usually practical and

include details of the support available from local

organisations.

Specialist Business Organisations: there are a number of

business associations who aim to support entrepreneurs from

particular parts of the community eg Elephant Enterprise

(start-up courses specifically for women), Black Business

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Graduate Business Start-ups: Project Report


Association (Waltham Forest) and Asian Business Association

(Waltham Forest).

Local Authorities: a number of local councils support Business

Ventures/Enterprise Centres which aim to encourage the

growth of new businesses through the provision of support,

advice and training.

While this plethora of support illustrates the considerable

commitment by government and other agencies to the provision

of appropriate support for new entrepreneurs, it also highlights

one of the issues identified by respondents to the graduate

survey — difficulty in identifying sources of advice and

guidance. We referred earlier to the experience of staff from the

London Institute Careers Service in undertaking research into

these organisations. There are arguments in favour of

rationalising the provision available in order to improve

accessibility to an important client group who are more likely to

be at ease using these networks because of their educational

experience than other potential entrepreneurs.

Further details of additional resources available for business

start up appear in Chapter 7.

Graduate Business Start-ups: Project Report 41


7. Resources

There is a wide range of resources available to those interested in

setting up their own business or working freelance. The

organisations responsible for assisting those interested in

business start up offer various facilities:

! financial support including loans, grants

! business advice, eg assistance in drawing up a business plan

! premises, eg studio or workshop space

! training courses

! legal advice

! marketing support

! networking and peer support or mentoring.

Some of the organisations active in this field have a national

network, others reflect the particular composition of the working

population in their own area and may offer targeted support to

groups within the community.

Set out below are details of some of the organisations active in

the support of those hoping to work as freelancers or to establish

their own business. This list is illustrative rather than exhaustive,

being based on research which the London Institute Careers

Service has undertaken as part of a DfEE funded project

Business and Enterprise Skills for Art, Communication & Design

Students’.

! Prince’s Youth Business Trust (PYBT) — 18 Park Square East,

London NW1 4LH

PYBT offers advice and loans to young entrepreneurs

through a national network of centres

! Shell LiveWire — Hawthorn House, Forth Banks, Newcastle

on Tyne NE1 3SG

LiveWire helps young people take a more enterprising

approach to their future careers and enables those who want

to set up in business turn their ideas into reality —

http://www.shell-livewire.org

! Clearing Banks

The major banks have Small Business Advisers who can

assist in drawing up business plans, help identify sources of

finance etc.

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Graduate Business Start-ups: Project Report


! Business Link

Government-backed and run by partnerships of commerce

and other agencies, Business Link aims to help businesses of

all sizes with a range of issues

! Training and Enterprise Councils (TECs)

TECs offer a range of services which can include advice,

counselling and training. TECs often work closely with

Business Link and also fund a number of agencies offering

support to small businesses in their community.

! London Enterprise Agency (LENTA) — 4 Snow Hill, London

EC1A 2BS

LENTA offers a range of support which is targeted at those

entering self-employment or operating a micro business,

including start up training and financial support

! Portobello Business Centre

This is an excellent example of a business centre which offers

a comprehensive support and training programme for new

businesses.

! National Association of Minority Contractors and Businesses

Its objectives include ‘encouraging and assisting local people

in starting their own business and ongoing business to

become successful’. Support includes — skills training, debt

collection, management and technical support.

! Association for Business Sponsorship for the Arts (ABSA)

Works with regional Arts Boards to offer advice, seminars

and workshops. Also runs the Business Sponsorship Incentive

Scheme which can match sponsorship with grant aid.

! Clerkenwell Green Association (CGA)

Through the Clerkenwell Award, newly trained crafts people

and designers can receive up to 50% of the cost of a studio for

18 months plus a complete business package including

ongoing consultancy advice

! Fashionworks Enterprise Partnership — Islington Enterprise

Centre, 64 Essex Road, London N1 8LR

This programme supports and assists unemployed fashion/

textile designers interested in starting their own business or

freelancing inter alia

! Crafts Council — 44a Pentonville Road, Islington, London N 1

9BY

The Crafts Council run a Setting Up Scheme which comprises

a maintenance grant and an equipment grant —

http://www.craftscouncil.org.uk

! British Franchise Association

offer advice and information on running a successful

franchise

! Industrial Common Ownership Movement (ICOM)

Information and advice on setting up a business as a cooperative

Graduate Business Start-ups: Project Report 43


Many of the organisations offering support to potential

entrepreneurs also have their own websites, including:

! Department of Trade and Industry (DTI) have put details of

the provision which they fund on their site, Enterprise Zone.

This includes information about Business Link.

http://www.enterprisezone.org.uk/

! National Federation of Enterprise Agencies

http://www.pne.org/cobweb/NFEA/default.htm

In addition there are sites which bring together much of this

information, including

! Liverpool John Moores University Careers Advisory Service

http://cwis.livjm.ac.uklcareers/sae/hpage.htm

! Sussex University Career Development Unit

http://www.susx.ac.uk/Units/CDU

There is also a wealth of publications available for those

interested in establishing their own business. Examples of some

helpful titles are set out below. Depending on the needs of the

individual there are many others which could be useful

Alternative Work Styles including self-employment — AGCAS

A Guide to help for Small Firms — DTI

Working for Yourself — Godfrey Golzen, Daily Telegraph

Lloyds TSB Small Business Guide — Sara Williams, Penguin

Running a Workshop — ed. Barclay Price, Crafts Council

Many of the agencies mentioned above provide guides and

pamphlets about business start-ups in general and issues such as

tax, copyright, health and safety, in particular

Rethinking Business Start Up — a new model for success in art

and design, by Linda Ball and Elisabeth Price, report on the DfEE

funded Graduate into Business Project. A resource for Careers

Practitioners and Academic Colleagues.

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Graduate Business Start-ups: Project Report


8. Recommendations

Stemming from our research for the Good Practice Guide, we

have identified a number of issues for HE Careers Services, and

also for Government and other national agencies. The following

is a set of operational and policy recommendations

! When Institutions are looking at the provision of career

management skills, that they recognise those competencies

which are particularly important in the context of selfemployment

and make appropriate provision. We would

hope to see students being enabled to manage the

boundaryless career, as well as managing careers within

organisations.

! that system designers be asked to investigate how

PROSPECT HE (Higher Education’s computer aided career

choice program in wide use in HE Careers Services), could be

developed, so that those motivations, skills and values,

particularly associated with self-employment, could be

highlighted.

! that in the writing of Association of Graduate Careers

Advisory Services (AGCAS) Graduate Careers Booklets, chief

writers are asked to assess whether there is scope within each

occupational area for a higher profile for selfemployment/freelancing

options.

! that those Careers Advisory Services which do not run events

around self-employment/starting your own business as a

part of their programme, consider doing so, possibly on a

regional basis, in order to test levels of interest and to

promote the idea.

! Many Services have made a point of developing links with

Innovation Centres and incubatory units associated with

their own Institutions to help boost contacts and to provide

placement or project assistance helpful to those who want to

explore their own business ideas, or who are at the stage of

wishing to survey self-employment as an option. As

additional Centres, such as the new Enterprise Institutes

come on-stream, Careers Services should build on their

existing good practice by continuing to foster

communications.

! that Careers Services might usefully consider linking their

websites to their Institutions’ Alumni website, where

appropriate, to enable students and recent graduates to

Graduate Business Start-ups: Project Report 45


access entrepreneurs from their own Institution who might

act as contacts or mentors.

! that an e-mail list is set up within AGCAS for HE Careers

Advisers and Career Information Officers to enable the

exchange of information on self-employment.

! Given the difficulty many graduates and Careers Services

reported in accessing information and support, that there

should be rationalisation of the agencies involved in this

area, to enhance promotion of their facilities, and greater

stability in their provision.

! Finally, it is our view that there is a role for Government, in

reviewing the existing provision for those seeking to start

their own business in the light of the findings of the research,

and in enhancing the resources available through Higher

Education Careers Services, to meet the needs identified by

graduates and students interested in business start up.

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Graduate Business Start-ups: Project Report

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