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A firm famed for its accountancy skills may not seem like a natural sponsor for a research centre in innovation and entrepreneurship, but Deloitte has agreed to partner with London Business School to set up just such a body.
Though both institutions are keeping quiet about the size of the Deloitte gift, it is thought to be at least £10m over 10 years.
Though trifling by US business school standards, this is the largest single gift received by LBS in its 47-year history – its previous largest gift was £5m in 1997.
The announcement is particularly timely for tax expert David Sproul, who will become chief executive and senior partner at the UK arm of Deloitte in June.
His rationale behind the investment is that the firm is now involved in all areas of business life, with audit accounting for less than 25 per cent of the business.
“We’ve had innovation and entrepreneurship on our agenda for some time. It’s about how do you create the next generation of businesses?”
Deloitte and LBS have had discussions over the past year, says Mr Sproul, who sees Deloitte’s people and their clients being closely involved with LBS faculty, both on the LBS campus and at Deloitte’s own innovation centre.
“The most important elements for us are that it is LBS, for which we have great respect, that it’s a 10-year commitment and that it [innovation and entrepreneurship] is embedded in what we do.”
For Sir Andrew Likierman, dean of LBS, the Deloitte Institute of Innovation and Entrepreneurship, as the centre is called, will be dual purpose. Apart from the obvious research agenda, it will also act as a catalyst, drawing together faculty from different departments to work together, something that business schools globally have been trying to do for the past 20 years. For example, some deans have tried bribery, paying finance faculty more for working with colleagues from other disciplines, like marketing. But for Prof Likierman, the answer is not money.
Instead “you do something because you want to. You can talk about money but at the end of the day they [academics] do it if they want to.”
Nonetheless, he concedes that the largest chunk of Deloitte’s money will go towards research funding, with the money used to “buy out” the academics’ teaching hours to enable them to do more research.
A chaired professorship and a series of funded outreach events are also planned.
“We’ve been building something organically, but now we have the funding to do it well. We’re very clear what we need to do.”
The LBS dean believes this collaborative model is ideal for research and teaching in a subject that crosses all the formal business school disciples. “We had entrepreneurship as a separate area but that didn’t work, and then it was in strategy, but that missed out lots of things. We think this is the model that will work.”
The centre will bring together four core faculty members – two from strategic and international management, one from management science and operations and one from marketing. Faculty from accounting, finance and other disciplines will be able to put forward proposals for funding.
Though the centre has been several years in gestation, it taps into an increased interest among LBS MBA students in studying entrepreneurship. As well as a core course in entrepreneurship, compulsory for all MBAs, there are seven elective, or optional courses and the entrepreneurship club is the largest of the 79 clubs at the business school.
It is not just LBS that is noticing a surge in interest in entrepreneurship. Schools such as Harvard Business School and MIT Sloan in the US both reported in 2010 that there was a real interest among graduating students in joining fledgling or start-up companies.
What is not yet clear is whether this was fuelled by a dearth of jobs in traditional sectors such as investment banking and consultancy, or whether it was a real interest in students wanting to be their own boss.