“Involve Me and I Will Understand”

Prepared for presentation at

The 8th Annual Economics Teaching Conference Orlando, FL,

November 9th, 2012.

There is a famous Chinese adage:

Tell me and I will forget, show me and I will remember, involve me and I will understand.

• As economics instructors, we always strive to perfect the art of teaching. • At my school teaching is the number one criteria for evaluation of faculty performance although recently research is emphasized but teaching is still the main concern. • I believe teaching economics is particularly challenging for those of us who teach economics to non-econ majors.

• A relatively large number of first-time students who come to our classes with the mindset that economics is a boring, abstract subject, and who can blame them. • I understand that passive teaching is perhaps the key reason why many economics students think economics is conceivably irrelevant to real-life cases.

• I have come to the realization that the crux of the problem is teaching solely from textbooks that are rich in terms of sophisticated theories but have poor when it comes to practical applications.

• There are success skills that cannot be acquired from lecturing per se, but must be obtained through practice, trial and error, problem solving, and analytical exercises. • In light of this, instructors must provide various opportunities for students to apply their theoretical knowledge and to learn on their own by creating a suitable environment.

• A clear manifestation of the changing emphasis and priorities is the popularity of non-textbook economics books: Freakonomics, Price of Everything, That Used to Be Us, the Aftershock, and What Money Can’t Buy to name a few • In addition, variety of teaching seminars and workshops on economics education are offered every year symbolize the serious attempts to mend the unflattering representation of economics as an abstract subject.

• There are a few pedagogical methods that I believe can make teaching effective, rewarding, and a more pleasant experience. • Understandably, there is no universal method that works best, some methods have worked well for me.

Two essential elements of good teaching: content and delivery system. 

Content: Strong Poor 

Delivery: 

Strong Excellent Mediocre  

Poor lackluster Awful

Involvement as an essential component of effective teaching. • As such, instructors must provide ample opportunities for students to get involved using innovative approaches.

• For several years I have encouraged my students to participate in a series of community based projects to get them involved

• The one I am going to present today is an entrepreneurial project I call the SMALL BUSINESS PROJECT, SBP.

Importance of Small Businesses• One of the unintended, but positive, consequences of recent Great Recession was the realization of the fact that small companies play a significant role in generating jobs and keeping our economy buoyant.

• Of the 29 million U.S. business establishments, 96% have fewer than 500 employees; 4% have 500 or more.

• The large businesses employ 50.6% of the workers; the small businesses employ 49.4%.

•When it come to job growth, the situation is different, the Kansas City Fed says that small businesses accounted for 79.5 percent of new job creation from 1990 to 2003, while large businesses created only 7.3 percent of jobs, and mid-sized businesses 13.2 percents in that same time period.

• Historically, small business’s contribution to GDP has been about 50% even though this share has fallen to below 50 percent for the first time, 46% in recent years.

Challenges unique to small Businesses:

• Small business owners tend to rely on their personal resources. They think that they can do everything themselves. The percentage of small businesses with 10 or fewer employees is about 93%. In fact, 76.9% have no employees.

• They don’t think that they need professional services, even if they do, they may not be able to afford them.

• High opportunity costs. Time is very scarce, hence precious for small business owners. Attending training sessions therefore, entails a high opportunity costs, as well as monetary costs, for them.

• In addition, such services may not be available on structured basis because of lack of supporting network and trained staff especially in local communities.

• Inadequate schooling makes it difficult for the small business owners to find professional services that help them to succeed. Even if the useful information is available to them, they may not be able to make use of it.

• That is why such services must be provided for them most effectively via personal contacts by external sources. The question of delivery mechanism is also another issue that will be addressed by this proposal.

• Despite their significant contribution to the economy, scant attention has been paid, by government, to economic needs of these business institutions at least before the presidential election.

 • The business schools can play a pivotal role by developing programs devoted to building partnership with local businesses and by requiring students, especially those majoring in economics and business, to engage actively in business-oriented projects.

• And, the university professors can contribute to these programs effectively without watering down the academic rigor by encouraging and rewarding students for their participation in this programs.

• Training students to become a source of professional advice to small businesses in the community is the fist step in Small Business Project discussed by this presentation.

• The primary goal is to prepare a step by step instruction manual for service-learning method of teaching/learning, engaging students with experiential projects, and develop schemes to assess the effectiveness of business-oriented projects referred to earlier as small business projects, SBP.

 • Under the supervision of a faculty advisor, the students will be trained to teach the necessary analytical skills to the local entrepreneurs, skills that help them to succeed in today’s competitive environment or to overcome the problems they are experiencing.

Benefits to Students:

• student will actively move beyond the abstract world of classroom teaching and take advantage of the opportunities that allow them to apply their theoretical knowledge to real-life cases thus enhance their own learning experience,

• Students will help to lift the standard of living in their community and promote the public awareness of economic and social issues.

• Elevating the level of welfare for the business people who may be in dire need of support and professional consultation

•Networking with business firms that helps them to explore employment opportunities

Role of faculty advisor:

• Mentor, coordinator, and the liaison between various parties involved with this project.

 • He/she solicits the active support of the school’s administrators and colleagues,

 • Makes sure that various phases of the projects are executed on time,

• Providing feedback and making sure that the benefits of this project will continue even after it ends.

• Fundraising

Different phases of this project;

1.  Recruiting, Preparation, and training, •The first couple of weeks of project will be devoted to brainstorming, training, and reviewing the key economic and business concepts.

•The college of business with the assistance of the faculty advisor will offer training to the participating students.

• The participating students will learn the analytical tools and concepts such as:

• costs analysis, demand analysis, the characteristic of potential customers, what factors influence demand for their products, break-even analysis, basic financial statements, market niches, pricing strategies, average cost estimation, how the profit maximization can be achieved, and how investment projects can be assessed correctly, and the market structure under which they are operating.

2. Selection of a project/team leader,

• selecting a motivated student with proven leadership ability as the project leader.

• Functions: Progress reports to the faculty advisor

• Formal contacts the various parties involved,

• Schedules the meetings, and arranges the transportation to and from the business firm’s location.

• He/she keeps track of those who attend the meetings and the progress made, documents every visit, and presents a summary of project after the completion of the project to faculty advisor.

• The designated project leader may also arrange the fund raising events to generate money for the related expenses or seek additional funds from school.

 • He/she is also responsible for keeping track of the expenses related to SBP and saving the receipts for reimbursement purposes

3. Selecting a target business firm• finding a target small business firm in the community with unique product and/or in need of consultation is the goal of this step.

• The small firms are usually owned by an individual or families, rely on local market, and are financed by family funds or occasionally by bank loan.

• Mangers/owners of these businesses believed to lack adequate education and/or modern business skills.

• Students can find such firms by visiting the neighborhood, talking to their employer or to other students, inquiring from their parents and their professors, and etc.

 • After selection of the target business form, the team leader will send a letter to the owner to initiate the initial contact and explain the project and the process to the owner of the business as well as his intention to visit the business on site and arrange a brief interview with the owner/manager.

4. Consultation and advising, • In this phase of the project, students collect the needed information about the firm’s operation and start the consultation process.

• To minimize the cost to entrepreneur, the students visit the company on site

• At early visits students collect relevant information that help them to diagnose the existing and potential problems and provide relevant advice on systematic basis.

• After the initial contact(s), students meet at school to formally discuss and analyze the information they have obtained. They usually meet once a week.

• They, then, decide what method will be most helpful to the particular business they are dealing with and what type of changes the business needs to make.

• During this phase of SBP student collect data about existing and potential market for the firm’s product, the socioeconomic traits of the surrounding community, the characteristics of current and potential customers, and the laws and regulations that can have an effect on the business.

• Furthermore, students obtain data on the nature of production mode and the key inputs, costs structure, workable marketing strategies, and other information deemed relevant.

• The collected data will be analyzed by the students at the end of this stage, tallied, and summarized in a report.

• The report provides a through explanation of the status of the business, detection of any possible problems, and more importantly, recommendations for improvement.

• During the subsequent visits, students will discuss with the owner what kind of changes/strategies they think will help his business and what they plan to do to accomplish that.

• Student may also purchase some of the products produced by the firm, or ask for donation, to sell in campus for fund raising purposes.

• The plan of action designed and prepared by the students should be tailor-made to suite the specific condition of the selected business firm.

5. Documentation and written report,

• at this stage, a comprehensive written report is provided by the students and preparations are made for a presentation at the school or in a class, and/or regional competitions with teams from other schools in a Regional Competition.

• Such competitions are sponsored by the Students in Free Enterprise, SIFE, a national organization dedicated to the promotion of market economy and entrepreneurship.

• The report should include the title of the project, a profile of each and every student participated in the process, a through explanation of the firm: strengths, opportunities, weaknesses, threat, etc.

• Project also included its purpose and its impact, the method of implementation, the outcome, the sustainability of the project, and, how was it utilized by the target business firm.

 

• Everything must be documented using the latest instructional technology, images, testimonial videos, and other visual aids.

• The report then will be condensed into a number of Power Point slides for formal presentation at school or at the regional SIFE competition.

 

• The report can be supplemented by auxiliary documents such as a video-taped testimonial statement by the owner of the firm about the impact of SBP on his/her business.

 • Outcome assessment report must also contain a statement about the sustainability of the project and if it continues the next semester or next year.

6. Outcome Assessment, • The purpose of the last phase of SBP is to explore the degree by which the business firm has been impacted by the students’ efforts.

• The assessment report contains information about the impact of the SBP program and how it helped the targeted business, the number of hours spent on each phase of the project, the quantitative data showing the progress made, etc.

• To formalize the processes, students develop formal contact letters and survey instruments to facilitate their work at various stages of this project.

• Such instruments will be used by students to collect data related to the firm’s operation, collect input from current and potential consumers, test market the products, collect information about the surrounding community, etc.