Entrepreneurship and the labor market

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Chernihiv National University of Technology) and four Russian universities. (Polzunov Altai State Technical University Barnaul, Moscow State University.
Fortmüller, R., Cechovsky, N. Richard Fortmüller, Professor, Vienna University of Economics and Business (Vienna); Nora Cechovsky, Senior Lecturer, Vienna University of Economics and Business (Vienna). © Fortmüller, R., Cechovsky, N., 2015

Entrepreneurship and the labor market. The contribution of the EUTempus-Project BUSEEG to promote employment in the Ukraine

This article presents an overview on EU-Tempus-Project BUSEEG. It deals with the issues of competence approach in training future entrepreneurs. It also determines the list of competencies required for the creation and responsible management of a company, and which should be taught in entrepreneurship education courses. The article examines to what extend supporting start-ups through appropriate educational programs and consulting services can contribute to creating new jobs. Keywords: competence, competence approach, educational programs, vocational training, start-ups. Р. Фортмюллер, Н. Чеховськи Ріхард Фортмюллер, професор Віденського університету економіки та бізнесу (Відень); Нора Чеховськи, старший викладач Віденського університету економіки та бізнесу (Відень). © Фортмюллер Р., Чеховськи Н., 2015 Підприємництво і ринок праці. Внесок проекту ЄС BUSEEG в розвиток покращення працевлаштування в Україні 1

У статті представлений проект ЄС Tempus BEEG. Розглядаються питання компетентністного підходу в підготовці майбутніх підприємців. Визначається перелік компетентностей, що необхідні для створення та відповідального ведення бізнесу, про включення їх до освітніх програм із підприємництва. Обґрунтовується, яким чином підтримка підприємцівпочатківців за допомогою відповідних освітніх програм і консультаційних послуг може сприяти створенню нових робочих місць. Ключові слова: компетентність, компетентністний підхід, освітні програми, професійна освіта, підприємці-початківці. Introduction. The European neighbors in the east still have a long way to go in order to develop a fully functioning market economy including high social standards. Especially a productive and successful medium-sized business sector that strengthens the regional economic structure is needed. Therefore a suitable legal and bureaucratic framework and, at best, financial assistance for start-ups would be essential. Furthermore in order to successfully establish and run a business, entrepreneurs require a sound business idea, economic and businessrelated competences, social competences and personal competences. The objective of this EU-Tempus-Project BUSEEG is to teach the competences mentioned above at universities and vocational schools in the Ukraine and Russia and to offer start-up consultancy for entrepreneurs. First, the following article provides an overview on the EU-TempusProject BUSEEG. Second, the competences needed for the successful foundation and responsible management of a company, which should be taught in Entrepreneurship Education courses, are going to be discussed. Third, it is going to be examined to what extend supporting start-ups and Entrepreneurship Education can contribute to the creation of jobs.

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The EU-Tempus-Project BUSEEG. The primary objective of the EUTempus-Project “Berufliche und unternehmerische Selbständigkeit durch Entrepreneurship-Erziehung und Gründungsberatung (BUSEEG – RU-UA)” (Developing Intra- and Entrepreneurial Competences through Entrepreneurship Education and Start-up Consultancy) is to sustainably support entrepreneurial self-employment through Entrepreneurship Education and start-up advice at vocational schools and universities in the Ukraine and Russia. In particular the following objectives should be accomplished within the project period of three years (December 2013 to November 2016): 1) The implementation and improvement of Entrepreneurship Education for students from various fields of studies at Russian and Ukrainian universities (business administration, engineering, tourism etc.). 2) The implementation of Entrepreneurship Education for students from various fields of studies (with a focus on business administration, engineering, tourism etc.) at vocational schools in two regions in the Ukraine (Kiev, Kharkiv) and in Russia (Barnaul, Nizhniy Novgorod). 3) The development and reorganization of start-up advice centers in order to support university graduates who intend to start their own business. 4) The development and reorganization of start-up advice centers in order to support vocational school graduates who intend to start their own businesses. 5) The training of vocational school teachers in order to improve their expertise and teaching skills concerning Entrepreneurship Education. 6) The training of university teachers and lecturers at teacher training centers in the field of business didactics. The Tempus-Project BUSEEG is coordinated by the Vienna University of Economics and Business (VU). The VU is partnering with two European universities (Széchenyi István University Györ, Hungary and University of Konstanz, Germany), four Ukrainian universities (Getman Kyiv National Economic University, National Technical University “Kharkiv Politechnic 3

Institute”, Stefanyk Carpathian National University Ivano-Frankivsk and Chernihiv National University of Technology) and four Russian universities (Polzunov Altai State Technical University Barnaul, Moscow State University of Geodesy and Cartography, Lobachevsky State University, Petrozavodsk State University), two Russian teacher training centers (Altai Region Institute of Teachers Professional Development Barnaul, Nizhniy Novgorod Institute of Education Development), Ministry of Education and Science of Ukraine, Ministry of Education and Science of the Russian Federation, Ukrainian Chamber of Commerce and Industry and regional Russian Ministries of Education and Chambers of Commerce in order to successfully accomplish this project. For the fulfillment of the project objectives a competence model as well as a core curriculum for Entrepreneurship Education has been developed. In detail Entrepreneurship Education has been integrated with a total of 20 ECTS in existing curricula at Ukrainian and Russian Universities and in the curricula of vocational schools with a total of 4 hours per week. Based on this competence model and this core curriculum teacher training programs for university and vocational school teachers, teaching and learning material for Entrepreneurship Education and a concept for start-up advice have been created. The teaching activities and the start-up advice have already started during the project period and will be carried on afterwards as well. Table offers an overview of the subject areas and the basic structure of the core curriculum. This common core with a total of 8 ECTS covers the teaching and learning content that is offered by the partner universities. On the details concerning the deepening teaching and learning content with a total of 12 ECTS is agreed upon individually at university level. The curricula of the vocational schools are based on this common core curriculum.

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Entrepreneurship – establishing and managing a business Content (mandatory and/or elective courses) Common core In-depth 8 ECTS module 12 ECTS Basics in Business Administration Legal Framework 0,25 0,5 Investment/Acquisition/Production 0,25 0,5 Calculation and Finance 2,0 3,0 Marketing 2,0 3,0 Organization/Human 0,25 0,5 Resources/Management Business Idea and Business Plan Development Workshop on Business Ideas and 2,0 2,0 Business Plan Economic, Social and Ecological Framework Market Economy 0,5 1,0 Social-, Self-, Methodological Competence 0,5 1,0 Social and Ecological Sustainability 0,25 0,5 Content of the Core Curriculum.

Figure illustrates the three dimensions of the competence model. The first dimension depicts the teaching and learning content of the core curriculum. The second dimension resembles the levels of complexity of the assignments within the different content areas. The third dimension characterizes the intended learning outcomes of Entrepreneurship Education, which is divided in accordance

with

the

European

Qualification

Framework

(EQF)

into

“Knowledge”, “Skills” and “Competence”.

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Figure Structure of the competence model Competences needed for founding and managing a business. The competence model for Entrepreneurship Education distinguishes between three different categories of learning outcomes (see Figure): Knowledge, Skills and Competences. This distinction refers to the European Qualification Framework (EQF) and is backed by the learning theory. Consequently, processes of cognitive learning can result in three different types of learning outcomes: 1) Explicit knowledge about circumstances (facts, events, methods, formulas, theories, research findings etc.) that can be presented verbally and/or graphically. This type of knowledge can only be used to complete specific tasks very slowly and result in a lot of errors. Those learning outcomes are known in everyday language as “knowledge” whereas literature concerning learning theory uses the term “declarative knowledge”. This type of knowledge can be 6

acquired by different methods, e.g., by listening to lectures or reading a textbook (Anderson 1983, 2013; Fortmüller 1997, 2009; Konczer 2012). 2) Implicit knowledge about how activities have to be carried in different situations in order to fulfill a specific task. This learning outcome is known in everyday language as “skills” or “abilities”. Learning theory literature, however, refers to it as “procedural knowledge”, which can only be obtained by working on specific tasks independently (Anderson 1983; Fortmüller 1997, 2009; Konczer 2012). 3) Cognitive dispositions, which not only enable students to fulfill a specific task but also, enable to handle a whole category of tasks. Those dispositions are known in everyday language as well as in literature of learning theory as “competences”. Those competences are based on a combination of knowledge and skills (abilities) and enable somebody to solve problems flexibly (Weinert 2001, Klieme 2004, Fortmüller/Langmann 2008). Therefore Klieme (2004, p. 13) states: “Competence establishes a connection between knowledge and skill and can be seen as an ability to manage different situations”. The differentiation between knowledge, skill and competence can be explained by using the example of learning a foreign language. Studying the vocabulary and the rules of grammar results in the acquisition of (declarative) knowledge. This knowledge can only be used slowly and error-prone in order to fulfill a specific task, e.g., the production of a phrase. However, it takes sometraining to produce similar phrases correctly and within a minimum of time (skill, ability or procedural knowledge). A fluent communication calls for the connection between the skill to produce phrases, the knowledge of the words used and the knowledge of the appropriate usage of the words (competence). Similarly this can be transferred to Entrepreneurship Education. For example, it is not sufficient that students can explain the terms “fix costs” or “variable costs” (“knowledge” or “declarative knowledge”). They should, additionally, be able to distinguish between fix and variable costs based on 7

specific cases (“procedural knowledge”). Furthermore they should be able to use their knowledge and skills in different cases and situations in order to calculate the full costs and the partial costs involved (“competence”). Entrepreneurship Education intends to develop competences in the field of founding and managing a business. On the one hand those comprise of businessrelated competences as for example the ability to calculate full and partial costs for the production of goods and for the provision of services of the enterprise founded to realize the business idea and based on this the competence to develop a sustainable business plan. On the other hand, managing a business requires social and personal competences as for example the ability to negotiate or facilitate meetings. In order to develop those competences mentioned above, one has to work on practical problems, e.g., case studies, which represent those challenges that have to be met when starting a business. Working on practical problems requires fundamental knowledge as well as the ability to deal with simple exercises. Therefore Entrepreneurship Education essentially needs to focus on the development of all three categories of learning outcomes – knowledge, skills and competences – within the teaching and learning content of the core curriculum (Aff/Fortmüller 2010; Fortmüller/Konczer 2013). Founding a business as a contribution to the provision of workplaces. The foundation of businesses can contribute to the provision of workplaces in three different ways: 1) An employee founding his or her own business results in a vacant position; 2) the newly found business is going to recruit further employees; 3) people out of work founding a business and therefore creating their own jobs. As a result Entrepreneurship Education is a significant instrument for the regional economic policy, but also an instrument of the labor market policy. 8

This, however, requires potential company founders to offer products and services with a high customer benefit since this is the only way to generate additional demand. This demand supports economic growth and the creation of employment opportunities. Following this approach Entrepreneurship Education cannot be seen as a substitute but as a supplement to sound technical skills gained at a university or vocational skills received at a vocational school. Therefore the Tempus-Project BUSEEG implements Entrepreneurship Education and start-up consultancy at vocational schools and universities. The concepts and materials developed can also be used for training those people who are without a job but intend to found a business in order to create their own workplace.

References: 1. Aff J., & Fortmüller, R. (2010). Wettbewerbsfaktor Entrepreneurship. Eine Studie aus pädagogischer und psychologischer Perspektive. In : J. Aff & R. Fortmüller (Hg.) Entrepreneurship Erziehung in der Russischen Föderation. Wien : Manz-Verlag. S. 15–32. 2. Anderson, J. (1983). The Architecture of Cognition. Cambridge : Harvard University Press. 3. Anderson, J. (2013). Kognitive Psychologie. Deutsche Ausgabe herausgegeben von Joachim Funke. Berlin, Heidelberg : Springer-Verlag. 4. Fortmüller, R. (1997). Wissen und Problemlösen. Wien : ManzVerlag. 5. Fortmüller, R. (2009). Learning through Business Games : Acquiring Competences within Virtual Realities. Simulation & Gaming, Volume 40, Number 1. S. 68–83. 6. Fortmüller, R., & Langmann, I. (2008). Learning Outcomes of ELearning

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Development of Management Training Courses for Transport and Logistics Sector. S. 13–18. 7. Fortmüller, R. & Konczer, K. (2013) : Transferförderung im Unterricht. In : J. Aff & R. Fortmüller (Hg.). Entrepreneurship-Erziehung im wissenschaftlichen Diskurs. Wien : Manz-Verlag. S. 123–130. 8. Klieme, E. (2004). Was sind Kompetenzen und wie lassen sie sich messen? Pädagogik 6/04, S. 10–13. 9. Konczer, K. (2012). Buchhaltungsunterricht als Studienvorbereitung? Lerntransfer im Rechnungswesen. Wien : Manz-Verlag. 10. Weinert, F.E. (2001). Vergleichende Leistungsmessung in Schulen – eine

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This article was submitted 11 September, 2015

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