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EFFECTIVE MODEL OF ENTERPRENEURSHIP LEARNING IN HIGHER

EDUCATION: PERSPECTIVE IN INDONESIA

Conference Paper · October 2015

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 EFFECTIVE MODEL OF ENTERPRENEURSHIP
LEARNING IN HIGHER EDUCATION:
PERSPECTIVE IN INDONESIA

Bambang Suroto, Hadiyati, Afred Suci

Lancang Kuning University, Pekanbaru, Indonesia

Abstract

Entrepreneurship education at colleges in Indonesia is relatively fail to grow the

entrepreneurial culture and less able to create new young businessmen. As a result, the
ratio enterpreneuers and competitiveness rank are still far behind globally. The approach
of education model is still widely practiced partially without integrating various internal
and external dimensions of the colleges. Therefore, this study aimed to develop a
conceptual framework of effective model of entrepreneurial learning at the higher
education, observing either internal dimension, including curriculum and teaching
methods and educational facilities, or external dimension, includes the role of
government and private sector.

Keywords: Entrepreneurship Education Model, Higher Education

1. Introduction

Although Indonesia is currently listed as the top 20 countries with the largest
economies in the world (G-20), but the unemployment rate remains a major issue.

Table 1. Total Labor Force and Unemployment in Indonesia

Total Workforce Employeed Unemployeed
Year % %
(million) (million) (million)
2010 116.5 108.2 92.9 8.3 7.1
2011 119.4 111.3 93.2 8.1 6.8
2012 120.3 113.0 93.9 7.3 6.1
2013 120.2 112.8 93.8 7.4 6.2
2014 121.9 114.6 94.0 7.3 6.0
Source: Data processed from the Central Bureau of Statistics

Solution taken by the Indonesian government is encouraging the growth of new

entrepreneurs. Quantitatively, the ratio of entrepreneurs is still very low at 0.18% of
the population, much less than the United States (12%), Singapore (7.2%) and
Malaysia (3%). Ideally, McClelland states that it takes at least 2% of the total
population in a country to have a productive economy (Komara, 2014). Qualitatively,
Indonesian rank is left behind from other countries. Data released by Global
Entrepreneurship Index (GEI) 2015, placed Indonesia in the rank of 120 out of 127
countries. The score is only 21, while the first rank is US (85). In ASEAN alone,
Indonesian entrepreneurs are left behind from Singapore (rank 10), Malaysia (rank
53), Thailand (rank 68) and even with Myanmar (rank 109) (Zoltan, et., al., 2015).
This indicates that the quality of Indonesian entrepreneurs in a global context are still
very low.
In line with those conditions, Indonesian Ministry of Education sees the need to
encourage the youth having entrepreneurship interest and enhance their quality as
well, especially at the higher education level. Colleges chosen because it has a real
and significant role in building the economic of a country. Katz stated that the college
is the main source for knowledge and human capital in building innovation,
entrepreneurship and productivity (Naderi, et., al., 2013). Colleges responsible for

1
educating and giving the student the ability to see and manage business opportunities
and provide motivation to dare to face business risk (Komara, 2014).
A concrete manifestation taken by the government is to require entrepreneurship
courses at the college level (Ferbiyanto, 2013). College is not obliged to always
produces new entrepreneurs, but at least to early introduce students about ideal
characters of an entrepreneur (Marques and Albuquerque, 2012), such as
independent, daring to face the risk, desire to move forward, creative,
communicative, spirited leadership, business insight in taking advantage of
opportunities (Supriyantingsih, 2012; Sudarwati and Retnowati, 2015), committed,
optimistic (Chain, 2011) and has a business vision (Siswadi, 2013).
However, the problem of entrepreneurship education in many universities in
Indonesia is that the education culture is less support the development of the
entrepreneurial spirit, so that is hindering young people to develop their creativity
(Ferbiyanto, 2013). This is in line with Lim and David statement, that the biggest
challenge is the feasibility of entrepreneurship education curriculum and training
programs (Ward, 2012). The Ministry of National Education has stated that many
educators are paying less attention to grow students’ entrepreneurial character and
behavior (Wibowo, 2011).
So, it is necessary to formulate a model of effective entrepreneurship education,
so that the expected results, such as courage to start a business with its risk
calculation, can emerge and be implemented. Minimum target is to imprint the
entrepreneurial characteristics to university graduates.

2. Literature Review

Pinchot defines entrepreneurship as the ability to internalize the talent, engineering

and opportunities. While, entrepreneurs are people who dare to take risks, innovative,
creative, driven and able to deal with the opportunities appropriately (Wibowo,
2011). Enterpreneurship education is an attempt to internalize entrepreneurial spirit
and mental, both through educational institutions and other institutions such as
training institutes and so on (Wibowo, 2011). While the integrated entrepreneurial
education is a form of entrepreneurial spirit in building the following characteristics
required in implementing aspects of entrepreneurial management (Sudarwati &
Retnowati, 2015).
Curriculum, as defined by Nurhadi, is a set of plans and arrangements regarding
the objectives, content and teaching materials and methods used to guide the
implementation of learning activities to achieve educational goals. While teaching
methods are techniques are used to deliver the curriculum to learners (Sudarmiatin,
2009).
Facility is basically all the resources used to facilitate the implementation of a
business. Referring to the definition of entrepreneurship education, the facilities are
all resources that can be used to carry out entrepreneurship education effectively.
The role of government in entrepreneurship education is a set of behaviors and
actions taken by the government in order to support the success of entrepreneurship
education. While, role of private sector in this context is the behavior and action
taken by the business entities in order to support the success of entrepreneurship
education in higher education.

3. Methodology

Study is based on literature studies, covering a wide range of theoretical and

empirical research results that are relevant to entrepreneurship education. Expected
output is an effective model of entrepreneurship education in universities based on
the following determinant factors and their indicators.

2
4. Finding

The Effectiveness of Enterpreneurship Education

Study conducted by the European Commission in 2006 reported that

entrepreneurship education could encourage students to have interest in starting a
business (Hussain & Norashidah, 2015). Therefore, entrepreneurship education
should be designed appropriately so that it may encourage student to become
entrepreneur (Siswadi, 2013). Marques and Albuquerque (2012) states that
entrepreneurship education is not necessarily meant to produce new entrepreneurs,
but at least to produce college graduates who have the courage to start a new business
attitude when there is the opportunity and have a tendency to work independently.
Successful entrepreneurship education occurs when is able to achieve
educational goals, include the establishment of self confidence, business sensitivity,
tendency to start a business and have the courage to face the risks and threats (Naderi,
et., al., 2013 ).
However, Antonius Tanan said that it does not mean that entrepreneurship
education should be independent or have its own separated curriculum (Wibowo,
2011), but the entrepreneurial spirit itself must be internalized in all other courses.
Wibowo (2011) gives two indicators of successfull entrepreneurial studies. First,
by measuring the amount of time and effort of the students involved in the learning
process. Second, the ability of colleges providing resources, curriculum, facilities and
programs that attract the participation of students to improve actualization, fulfillment
and entrepreneurial skills.
Referring to a number of those previous empirical results, measurement of
successfull entrepreneurial learning can be grouped into the dimensions of the process
and outcome dimensions as follows:

Table 2. Dimension of Entrepreneurship Education Effectiveness in Higher

Education
Dimension Indicators
Process 1. The success of internalizing the entrepreneurial spirit in all
courses
2. The amount of time and effort of the students involved in the
learning process
3. The ability of colleges providing resources, curriculum, facilities
and entrepreneurship programs
Output 4. The emergence of students’ business units students
5. The emergence of students’ interest to start business
6. The emergence of the courage to start a business
7. The tendency of students to work independently
8. The emergence of strong confidence to start a business
9. Be sensitive to existing opportunities
10. Dare to face risks and threats in managing business

Curriculum and Teaching Methods

Classroom method is not enough to produce new entrepreneurs (Siswadi, 2013).

Although information on entrepreneurship can be learned through education, but a lot
of the knowledge is obtained from digging opportunities that can only be gained from
learning by doing. Many entrepreneurial knowledge and skills gained from the
business environment through the induction process, practical and social experience
rather than obtained from education (Moustaghfir & Sirca, 2010). Moreover,
according to Blenker, et., al., the current higher education system is not able to

3
increase motivation or entrepreneurial interests, capabilities and expertise.
Professional skills in aspects of learning methods and processes of entrepreneurship
are still rare (Naderi, et., Al., 2013). Then to obtain a good entrepreneurial skills,
should use appropriate learning methods that allow students engage in practical skills
(Esene, 2015). Improvement of curriculum and teaching methods of entrepreneurship
at universities in Indonesia need to be addressed (Siswadi, 2013).
Traditional approaches (theoretical) approach must be replaced to practical
applications (Nikoloski, 2014) which emphasizes practical application rather than
theory because the entrepreneurial characteristics and skills are obtained by sustained
efforts (Sudarwati & Retnowati, 2015). As also stated by Marques and Albuquerque
(2012), the best method is to teach entrepreneurial skills through real experience and
in accordance with the interests and talents of students (student centered). The World
Economic Forum (2009) gives an example of entrepreneurial learning methods by
providing a real experience and learning outside the classroom. Principally,
entrepreneurship reflects action, not just a mere book-based learning.
To be able to instill the values of entrepreneurship to students, they need to be
deployed directly to the industry or business inorder to understand the technical and
non-technical aspects of business. But it does not mean to simply ignore the theories,
because the entrepreneurial theoretical knowledge and knowledge of how to develop
a social network are still needed as its foundation (Hussain & Norashidah, 2015).
Theoritical and practical approach should be balanced. United State has been
practiced a contextual teaching and learning long time ago, that essentially help
teachers relate the teaching material to real life, so that students can actually practice
all theories they have learned (Sudarmiatin, 2009). In fact, in order to increase student
interest in entrepreneurship, universities need to multiply the frequency of
entrepreneurial practices and apply contextual learning (Mopangga, 2014).
So far the problem existing in formulating the curriculum is less - or even not at
all - involving business practitioners into the team. As a result, the curriculum
becomes less qualified. Drafting entrepreneurship curriculum must be done by a team
that really skilled and experienced (Komara, 2014). It is a phenomenon in many
developing countries. Adebayo & Otemuyiwa (2015) found that many
entrepreneurship curriculum at colleges in Nigeria formulated merely by lecturers. In
fact, as is known, many lecturers are not practitioners who have no background or
experience and technical skills of managing business. Knowledge and technical skills
completion to lectures as well as practical experience of entrepreneurship, then, need
to be done in order to adjust to business challenges (Esene, 2015).
Noteworthy is how to design and run a flexible curriculum that develop students’
creativity and entrepreneurial skills (Nikoloski, 2014) as well as the use of fun and
active learning methods to create value of entrepreneurship and excitement to start
business (Sudarwati & Retnowati, 2015).
Curriculum development can not be generalized for any condition and
geographical area, considering that each region has its own characteristics that require
specific approaches. Nikoloski (2014) states that the curriculum should be adjusted
based on the cultural and economic resources of each country. Similarly, Sudarwati &
Retnowati (2015) concluded that the curriculum should be adapted to the local
potential. So, the establishment of an entrepreneurship education curriculum should
be thematic in accordance with the potential and the availability of resources and
support as well as cultural competence in areas where entrepreneurship education was
held.
Curriculum should also be in line with the needs of the industry (Suyitno, et., al.,
2014). In this case, university should have the ability to integrate research-based
learning, market sensitive and market adaptable (tailor-made learning) (Moustaghfir
& Sirca, 2010). Do not let the products or services can not be absorbed by the
industry, especially the local industry as the main target market of beginners like
students’ business units.

4
 Effective curriculum must be concrete and applicable. Problem-based learning
approach must be encouraged where students learn how to develop the ability to
realize the business plans in actual terms, making and marketing products and
services (Siswadi, 2013). This approach is student centered according to the potential
they have, while lecturers act more as facilitators (Moustaghfir & Sirca, 2010).
Adebayo & Otemuyiwa (2015) found that the preparation of the curriculum is
not tailored to the needs of students in Nigeria, so that it gives difficulty to create
businesses after their graduation. Such phenomenon also occurs in many universities
in Indonesia, where entrepreneurship courses are simply to fulfill the instruction of
the Ministry of National Education and studied by students just to get grades.
Therefore, according to Sudarwati & Retnowati (2015), entrepreneurship education
curriculum should be tailored to the interests and talents of students.
In compiling the curriculum, entrepreneurship does not necessarily to be an
independent curriculum, but the entrepreneurial contents can be imprinted to part or
even all existing courses (Komara, 2014). The principle is how to internalize the
values of entrepreneurship into the curriculum / syllabus for all subjects
(Supriyantiningsih, 2012).
Compiling the description above, we may conclude that the components of the
curriculum and teaching methods is one way to enhance the effectiveness of
entrepreneurship education in Indonesia. Translation of these dimensions can be seen
as the following table:

Table 3. Indicators of Effective Curriculum and Teaching Entrepreneurship

Education in Higher Education
Dimension Indicators
Curriculum 1. Contains theoretical knowledge of entrepreneurship and the
development of social networks
2. Involving practitioners of entrepreneurship in the curriculum
drafting team
3. Flexible according to the changing business environment
4. Able to develop creativity and entrepreneurial skills
5. Thematic curriculum in accordance with local potential
6. In line with the needs of industry
7. Able to accommodate the interests and talents of students
8. Internalizing values of entrepreneurship to entire courses
Teaching 9. Emphasizes practice rather than theory in the classroom
Method 10. Implementing contextual learning
11. Using fun methods of learning that may raises excitement of
starting business
12. Using a problem-based learning approach

Entrepreneurship Education Facilities

In order to conduct entrepreneurship education effectively, the theoretical

teaching methods in the classroom should be minimized. In reverse, optimize the
resources available so that students can walk through the real experience related to
the problems and the dynamics of the business. To increase students’ interest in
entrepreneurship, universities must provide and equip campus facilities such as
laboratories, galleries, workshops and so on, according to their business
characteristics (Mopangga, 2014).
Physically, university, at least, should have an entrepreneurship centers, either in
the form of campus institution-shaped or student organizations (Komara, 2014).
Entrepreneurship center can also become a mediator between the financial institutions
with students’ and lecturers’ business units (Adejimola and Olufunmilayo, 2009).

5
 The existence of a business incubator will be able to encourage entrepreneurship
and innovation potential and the student can develop ideas into business start-up
(Nikoloski, 2014). According Hewick of Canadian Business Incubator (in Hasbullah,
et., al., 2014), incubation is the concept of entrepreneurship fertilization qualified in
workspace managed by an agency. While incubator is the physical building intended
to support the business through mentoring, training and fundraising assistance until
those business units can be considerely survive in a competitive environment. It
means, students’ business units will be nurtured in the incubator temporarily, about 2
or 3 years from start-up to be ready to compete in an industry where the business is
running.
University requires incubators in order to synchronize the entrepreneurial
learning material to the needs of industry. Incubators can provide business place,
capital access, counseling, training, research and development, product and marketing
assistance as well as providing expertise presentation to attract customers and
investors (Mahmood, et., al., 2015).
The college should motivate and encourage the emergence of students’ business
units (Komara, 2014). As a stimulant, then the university can allocate a sufficient
budget on a selected group of students to start a business based on the approved
business plan (Mopangga, 2014).
Non-physically, then as a facilitator, the task of university is also to open and
establish the networking with local stakeholders such as the Department of Industry,
Department of Cooperatives and SMEs, the Agency Creative Economy and private
sectors both financial institutions and industries (Mopangga, 2014). Thus, the
students’ business units may have partners for certainty of supply and market.
Another stimulant can be done by universities is conduct Entrepreneurship
Award competition or similar to ignite the spirit of entrepreneurship among students.
Competition form can be business plans or students’ products or services expo
(Komara, 2014). Business plan competition can be contested among faculties or inter-
universities with the guidance and support of business communities and government
(Adejimola and Olufunmilayo, 2009). Such events will pull out creative ideas, train
students to calculate business risks and could be one alternative funding source by
winning the competition.
From all various opinions, it is quite clear that the educational facility, both
physical and non-physical, is another way to boost the effectiveness of
entrepreneurship education in Indonesia. Translation of both dimensions can be seen
as the following table :

Table 4. Indicators of Entrepreneurship Educational Facility in Higher

Education
Dimension Indicators
Physical 1. Having an Entrepreneurship Center which serves as a coordinator
and facilitator of entrepreneurship activities
2. Having business incubator that serves as a center for training and
mentoring
3. The availability of students’ business units, include laboratories,
workshops, galleries, stores and the like.
4. Budget allocation for students’ business start-up
Non 5. Networking with local stakeholders both public and private sectors
Physical 6. Conducting business competitions periodically

Role of Government

Contributions of governments in developing countries often fail to enhance the

role of youth in the labor market as planned. So the chance for determining policies

6
relating to the role of young generation is still wide open (Nikoloski, 2014).
Contribution of educational institution needs to be involved in order to be able in
alleviating the Indonesia poverty problem and unemployment by opening up the
opportunity for educated generation of starting up business. Chain (2011) states that
the role of government significantly influence the building of entrepreneurial
behavior. Therefore, the government have tried to stimulate the real sector by
encouraging an increasing number of businesses entities to at least 2% of the
population. Concretely, government requires entrepreneurship education as a
mandatory course at the college level.
One positive steps that have been massively taken by government through
Presidential Decree No. 27 in 2013, which contains the policy to develope
entrepreneurial incubators that aims to encourage the creation and development of
new valuable and highly competitive businesses, as well as to optimize the utilization
of educated human resources by harnessing science and technology (Nugroho, 2015).
This is in line with government official program namely National Entrepreneurship
Movement (Gerakan Kewirausahaan Nasional / GKN) that has been socialized to the
level of secondary and higher education.
In the context of higher education, the role of government is done through the
Directorate of Higher Education since 2009 and has launched the Student
Entrepreneurial Program (Program Mahasiswa Wirausaha / PMW) to be implemented
and developed by universities. The program is implemented throughout the state
universities and colleges selected by the Coordinator of Private Universities
(Kopertis) with the different budget allocated. The success of this program at least
seen of the three indicators, namely the number of students who successfully run a
business, the formation of a model of entrepreneurship education in higher education,
and the establishment of strong and independent entrepreneurship education
development institutions that coordinate various activities related to entrepreneurship
at the college.
Besides directly provide financing for entrepreneurship education in college
(Sudarwati & Retnowati, 2015), government can extend opportunity of financing
through its role as a facilitator between college and private sector, especially with the
donors (Nikoloski, 2014). In this case, the government playas role as fund link access
to other institutes (Hasbullah, 2014). Government through related institution could
possibly become guarantor for private parties who will to invest or lend venture
capital to students’ business units.
The Government has also has duty to provide entrepreneurship training to
students through related institutions, in order to grow the business idea and provide
the skills to manage the business effectively (Sudarwati & Retnowati, 2015). Because
of the students’ business scale is averagely still small, then government in under an
obligation to protect those SME’s from high intense competition (Chain, 2011), one
of which is to ease businesses lisences for students (Sudarwati & Retnowati, 2015 ).
But most of all is the political will for creating a positive climate for developing
small business (Chain, 2011), including students’ business units, by acting as a
facilitator and regulator (Hasbullah, 2014 ). In this case the government may issue
policies that facilitate business units for students so they can easily get venture
capital, opening market access, raw material incentives, tax relief or issue a policy for
certain agencies to use products and services produced by students’ business units
that met the quality standards.
From the various results of empirical studies, the role of government can be
grouped into a direct role and indirect role in which government becomes a mediator,
facilitator and regulator for other parties in supporting the success of entrepreneurship
education in higher education. Translation of both dimensions can be seen as the
following table:

7
Table 5. Indicators of Government Role in Entrepreneurship Education For
Higher Education
Dimension Indicators
Direct 1. Funds allocating to support the growth of entrepreneurs in
Role universities
2. Provide entrepreneurship training through related agencies
3. Protecting the students’ business units in the competitive
environment
4. Providing ease business licensing
5. Provide tax incentives
Indirect 6. Creating a positive climate for developing SMe’s at the college
Role level
7. Being a mediator between universities and donors
8. Issuing policies that basically give students the ease of obtaining
venture capital for raising new business, market access and raw
materials
9. Encourage relevant parties to consume the products / services
produced by students’ business units

Role of Private Sector

Universities need to invite successful entrepreneurs in the process of

entrepreneurship education (Nikoloski, 2014). As declared in the World Economic
Forum in 2009 that, "No entrepreneurship program can succeed without close
interaction with interpreneurs" (Marques and Albuquerque, 2012). That phrase
means that any successful program of entrepreneurship, including those conducted at
the college level in desperately need the presence and role of the private sector.
Private sector can play either the role of supply where students’ business units can get
supply or role of demand that can absorb products and services produced by students’
business units.
The shape the private sector role could be the corporation who provide training
to improve the skills of human resources for both lecturers and students; business
internship opportunities; and opportunities of business cooperation (Komara, 2014).
Companies can give students the opportunity to use the business facilities owned by
the company, where students can learn to run a profitable business, so that students
not only have opportunities to learn and run a business, but it also can become a
source of revenue for the institution (Suyitno, et., al ., 2014).
Other private sector role comes from financial institutions in which government
and campus become a facilitator and mediator between the students’ business units
and investors. The contribution can be formed as loan facilities and business
assistance as well as the development of how to manage venture capital effectively
and efficiently (Komara, 2014). It needs to be done so that the venture capital
managed by students can be right on target, and the loan can be returned on time and
reduce the non performing loans. If this can be realized, then successful
entrepreneurial education can be claimed, because students have not only the courage
of setting up new businesses, but also can manage it properly so that the potential risk
can be maximumly avoided.
From those various results of empirical studies, then the role of the private sector
can be grouped into corporate / industrial and financial institutions. Translation of
both dimensions can be seen as the following table:

8
Table 6. Indicators of Private Sector Role in Entrepreneurship Education for
Higher Education
Dimension Indicators
Industry 1. Provide training to improve the skills of human resources
2. Open opportunity for students to intern with the company
3. Provide the opportunity for students to learn to use business
support facilities
4. Open opportunity to relate business cooperation with students’
business units, either in the form of supply of raw materials or as a
market that absorb products / services produced by student
Financial 5. Providing ease of business loan
Institution 6. Assistance to students’ business units start up
7. Fostering effective and efficient financial management

5. Conclusion and Recommendation

The success of entrepreneurship education in universities can be seen from its

process itself and outcomes. It can only be effective if supported by whether internal
or external aspects. Internally, it is recommended to formulate an effective learning
curriculum design and delivered with appropriate teaching methods. Universities are
also required to complete the facilities, both physical and non-physical, to support the
educational process. Externally, the direct and indirect roles of government and the
role of industry and financial institutions must be enhanced as it will determine the
success of entrepreneurship education in college.
Thus, the conceptual model of an effective entrepreneurial education in higher
education can be described as shown below:

Figure 1. Model of Entrepreneurship Learning in Higher Education

curriculum and
teaching method
Private Sector
Government

Enterpreneurship
Education

Education Facilities

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