I (Shaun) have never been a fan of the word business and especially the term business major. It sounds so ordinary and boring. Yet there are businesses today that are curing diseases, delivering supplies to the International Space Station, and helping wounded veterans walk again. Even if your work is in marketing, finance, public relations, or sales, it's no less exciting to be involved in something like that and do your special part to help it succeed. On the flip side, the terms entrepreneur and start-up sound sexy. They convey a vision of hustle, big dreams, and money. But I've been an entrepreneur and met hundreds more of them over the years, and the reality can be more like grueling work that cuts deeply into your personal life, dark days when you're not sure how you will pay your employees, and no guarantee of success even if you're lucky enough to raise money from investors. Today more than any other time in our history, the idea of entrepreneurship has become a prestigious pursuit, so much so that magazines love to write sensationalized articles about entrepreneurs who dropped out of Harvard or Stanford to pursue their dreams.
In this chapter we explore business, entrepreneurship, and the kinds of experiences and educational programs that can prepare someone for these pathways. We also discuss some of the misconceptions about entrepreneurship and how to help your child explore entrepreneurship as a potential pathway.
Between the two of us, we have spent a combined total of about fifty years in business. We have worked for Fortune 500 companies and multinational conglomerates and have started businesses from scratch with our credit cards. We have hands-on experience with corporate strategy, product management, marketing, sales, customer service, consulting, contract negotiation, patent law, public relations, financial modeling, accounting, software development, quality assurance, management, leadership, human resources, public speaking, outsourcing, mergers and acquisitions, partnership development, and still more. We have personally participated in all of these and have also hired people to do them, fired people who didn't do them well, and made judgment calls about how to do them better.
We have at times been wildly successful and at other times fallen flat on our faces. None of our success would have happened without the help of many others working for us, alongside us, and above us. If there is a pattern we can identify about what made the greatest impact, it has little to do with what we studied in college. Of course, good marketers are good in part because they've learned their craft, and good data scientists must obviously have studied hard to learn the intricacies of data science. But their success had more to do with how they applied this knowledge in the real world of business, which is messy and full of people with competing strengths, motives, and needs. Book knowledge is necessary in certain roles, but it only gets one so far. Long-term successful careers in business are built more on how one handles early experiences in the workplace and whether one takes advantage of those early opportunities to learn, push beyond the comfort zone, and connect with mentors who can share hard-earned wisdom. So how can your child get started?
One of the great things about business as a career pathway is that there are many different ways to get started. Your child might assume that if she wants to be in business, she must get an undergraduate degree in business, accounting, or marketing. However, as we discuss in other chapters, anyone can just as easily enter the world of business with a degree in physics or history. As your child contemplates a business career, encourage her to think about her true interests and whether those align with specific business skills or more general areas. Accounting can be surprisingly complex and intellectually challenging for someone who is analytical and enjoys working with numbers. But it's a mistake to assume that because every business needs accounting services this is a practical degree. If your child feels no underlying interest in the topic or shows no signs of enjoying math or numerical analysis, she will likely find herself wishing she had studied something else. If she is hard-working and intelligent, she could study something more interesting to her without limiting her long-term career prospects in business.
There are opportunities for teenagers to experience some aspects of business, and we would strongly encourage any who are interested in business to get some experience to validate that interest. My twelve-year-old daughter, for example, decided to create a charity fundraising baking club in her middle school. She has never expressed an explicit interest in being in business, but the baking club has provided a remarkable range of experiences that have given her a taste of a career in business. She has had to recruit other members, estimate demand depending on location and weather, verify food vending regulations, assign responsibilities, sell products, keep track of costs and earnings, estimate cash needed from the bank, and deal with other club members who frequently fail to deliver what they promise and argue over her leadership decisions.
There are all kinds of clubs, activities, and experiences that can give kids an early sense of where their interests and talents in business may lie. As you help your child explore potential opportunities to experience activities or develop skills relevant to her interest in business, here are specific things you might seek:
There was a time when automation with computer software and robotics was mainly a threat to blue-collar occupations such as manufacturing. That time has long since passed. JPMorgan recently announced the rollout of new artificial intelligence software to interpret and review commercial loan agreements. This software can now do what loan officers and lawyers spent over 360,000 hours a year doing for JPMorgan previously.
Many of the occupations that fall squarely within the business field of study are facing significant changes through automation from software or the combination of software and cheap labor overseas. Some economists argue that this increase in productivity will allow companies to invest more, grow faster, and hire more employees or possibly create new kinds of jobs. Others have raised the alarm bells with claims that vast numbers of white-collar jobs will be automated out of existence within twenty to fifty years. Having worked as corporate executives ourselves, living the daily pressure to increase our revenues, control costs, and be innovative, if we were in a position to accomplish any of those with automation, it was our responsibility to seriously consider doing so. If your competition can move faster, provide better service, and charge less, then you will not be in business much longer. According to JPMorgan, its move to automate contract renewal was driven primarily by a need to stay ahead of aggressive competitors and innovate, not reduce costs.
So how do kids know what skills or careers may fall victim to automation, and how can they future-proof themselves? One of the biggest indicators of whether an occupation is vulnerable to automation is the presence of rules or patterns. Computers are very good at following rules—for example, accounting rules, construction regulations, or commercial contract law. If a job primarily involves being trained to understand a set of rules and then repeatedly use those rules to review, edit, or flag some issue, computers can likely take over that task. This is happening a lot with rote financial and legal tasks, but any field that incorporates rules is vulnerable to the extent that a job in that field involves a lot of rule checking and not a lot of experiential judgment—although even judgment can theoretically be automated if it involves reliable patterns. Computers are very good at finding patterns, even when human beings are not yet aware that such patterns exist. For example, computer software can now “train” itself by reading or viewing millions of images; once it learns patterns, it can apply those patterns to make highly reliable guesses. The software could look at thousands of images of breast cancer biopsies and the history of whether each was malignant or not. Once it has trained on these case histories, it may be better than a human being at reading biopsies and providing a diagnosis to a patient. It may even be better than a human doctor at guessing the type of treatment most likely to cure the cancer.
How do those who are starting out in business education and career inoculate themselves from the threat of automation? Here are several strategies:
You can also encourage your child to read online about the fields that interest her and to search for articles about automation and artificial intelligence in business journals and magazines. This will give her a better sense for how certain career fields are evolving and what the cutting edge of that field looks like. It may also help her learn about other career fields she might want to explore in college. This is one of the reasons I chose to attend the university that I did. There were many other excellent STEM programs I could have studied if I decided not to pursue my original intended field. Students should apply the same thought process to a business education and look for educational opportunities that will allow them to build a more diversified skill set or explore a wider range of career options.
We have already mentioned entrepreneurship a few times. There is a never-ending debate about whether entrepreneurship skills are something you are born with or something you can learn. We have seen so many different types of entrepreneurs that we don't think there is a single type of person who is successful at it. There are inborn traits that can help, like self-confidence, charisma, or self-discipline, but these same traits can just as easily be your undoing if you are not careful. What we have learned is that the best ingredient for success is experience. There is no better teacher and no better way to know if you really have what it takes or enjoy doing it.
At some point, your child may express a very tangible entrepreneurial goal. Maybe he wants to open a restaurant or bakery. Maybe she wants to build custom homes or open a massage therapy studio. Or maybe he wants to build the next Facebook or Uber. Is there anything you can talk about now, as your child is poised to move into early adulthood, that can help him increase the odds of success in the long run? We believe so.
As we discuss later in this book, it can be incredibly valuable and save a lot of angst and money in the long run if kids can find ways to “try on” a career before investing in a lot of preparation or taking a job in that field. This is particularly true with entrepreneurship, which can involve highly stressful financial risks and long work hours. Some degree programs do a great job of providing the kind of exposure that could be helpful to a future entrepreneur. Hospitality, hotel, and restaurant management programs, for example, often include direct experience in restaurants and hotels and provide networks of alumni to help students obtain practical internships that will be valuable in sampling certain aspects of business ownership.
A key concern with business ownership is that owners inevitably need to wear many hats. Often a passion in creating something (e.g., software products, ad designs, wedding cakes) will draw someone into business ownership, but it will be the challenges of sales, marketing, and cash management that can spit neophytes back out with bitter disappointment. For those going the entrepreneurial route, it's important to get some exposure to how these parts of a business or industry work.
Let's say your child gets a job as a prep chef in a local restaurant and has expressed a desire to be a chef someday with her own restaurant. Encourage her to ask the restaurant owner or manager questions about how they run the business. How do they market and find new customers? How long did it take for the restaurant to become profitable? How often are they having to hire new cooks and wait staff? What are their biggest challenges as a restaurant owner? Did they have to raise money from an investor to start out? Not every business owner will welcome these questions, but many will be happy to share and may even take the rare opportunity to vent their frustrations, which will be enlightening, to say the least. And even asking these questions of a manager at a big retail chain like The Gap, Home Depot, or McDonald's will teach kids something useful for understanding how a business runs.
What if your teen feels strongly that he wants to do a Silicon Valley–style technology start-up, either in college or immediately after? Maybe he is a technical whiz with some actual experience or already has an idea. As long as there are business magazines to be sold, there will be tales told of students who started a technology company in high school or college and went on to take over the world. It does happen, and if your child is lucky enough to have figured out how to do something that a lot of people want and will pay good money for, then by all means, he should go for it. Great business ideas don't come along every day.
More than likely, though, the real situation is that your child has some technology skills or related interests and wants to “do a start-up,” “have a start-up,” or “create a company.” This is not how successful companies are usually born. Great companies are usually born when someone figures out that there is a problem in the world that nobody else is solving well or that could be solved in a much better way and just happens to be in a good position to fix that. Typically that means knowing a lot about this problem, the kinds of people who have this problem, or the technologies that would solve this problem. Successful entrepreneurs want to make things that people want. They like solving problems for people, not just being an entrepreneur. For this reason, we recommend that you encourage your child to work for someone else for at least a few years before starting a business. Here are the potential benefits of this route:
In this chapter, we have shown how diverse business careers can be and how many educational and job pathways can lead to success in business as an employee or an entrepreneur. Our own careers have taught us that while education can open doors to many business careers, what your child learns on the job, how well your child works with others, and how hard your child works will be far more important in the long run.
Following is a sample of 2015 median annual earnings for various jobs in the business field according to the Bureau of Labor Statistics:
For wage information on other careers in the field not listed here and for more detailed local wage information or job prospects, we recommend using the online Occupational Outlook Handbook provided free by the Bureau of Labor Statistics at https://www.bls.gov/ooh/home.htm.
Keep in mind that we are showing median pay, so some people in these roles may earn substantially less and others may earn substantially more. Generally pay is higher in locations where the cost of living is higher and in fields that are growing more rapidly or require more specialization and experience. In addition to using the Occupational Outlook Handbook website, we recommend that your child conduct an Internet search using terms like “future job prospects for [career name]” to get the most current outlook on industry growth potential.