Entrepreneurs are from Mars and CEOs are from Venus.
If you hear how they talk about each other, you might buy into that view. To CEOs, entrepreneurs often mistake passion for ego. They skip steps and fudge fundamentals to finish first fast. At the same time, many entrepreneurs scoff at advice from executives, who have the luxury of funding, staff, infrastructure, and time. In pursuing scale and appeasing shareholders, entrepreneurs argue, many CEOs become distant from the source of their inspiration and sustenance: customers.
No, CEOs and entrepreneurs aren’t mortal enemies like Kennedy and Khrushchev (or Coke and Pepsi). In fact, their rivalry is more akin to tussles between brothers – rooted more in their similarities than their differences. And those similarities are strongly reflected in new data from the Graduate Management Admission Council (GMAC).
GMAC’s 2015 Alumni Perspectives Survey found that entrepreneurs and C-suite executives “were more likely to describe themselves as innovative, proactive, creative, and competitive.” In addition, the annual survey showed that advanced business education helped alumni advance their careers, increase their purchasing and earning power, and achieve higher levels of career satisfaction.
The survey, published Feb. 17, features the views of over 12,000 business school alumni who graduated from 1959-2014. Polled in October and November of 2014, the respondents were drawn from 230 graduate business programs at 71 schools in 16 countries, including emerging markets like China, India, and Latin America. This year’s sample was broken into six categories: entry level (5% of sample), mid-level (37%), senior level (36%), executive level (17%), C-suite (5%), and self-employed (12%). While this year’s study drew 9,000 fewer respondents than the 2014 report, it offers several surprises.
CEOs AND ENTREPRENEURS ARE VERY ALIKE – WITH SOME KEY DIFFERENCES
And the biggest surprise relates to the unexpected bond between C-level executives (CEOs, COOs, and CFOs) and the self-employed (entrepreneurs). Compared side-by-side, their responses are often identical. Both single out “personal effort/hard work” as the biggest factor behind their career success (33% for entrepreneurs vs. 32% for the C-suite). They also place near equal weight on networking, innate ability, and education.
There were some differences, obviously. When GMAC probed deeper, C-level execs gave business schools greater credit for their career advancement, increased earnings, and job satisfaction. This gap is particularly pronounced when the parties were asked to tie their education to job attributes like decision-making and leadership. Here, C-level execs gave education higher marks by 34% and 41% margins.
While C-suite executives valued education more, they exhibited an entrepreneurial orientation at a higher rate than alumni in other job categories. Let’s start with being proactive, where 38% of C-suite executives and 33% of entrepreneurs scored within the fourth quartile. Compare that to the executive level (28%), senior level (20%), mid-level (12%) and entry level (8%).
You’ll find this same dynamic when it comes to innovation, with C-suite (42%) and self-employed (32%) placing the most respondents in the fourth quartile. The same applies to social risk-taking, with the C-suite edging entrepreneurs by a 35%-to-34% margin in the fourth quartile. In other words, maybe CEOs aren’t as out of touch as they’re portrayed to be. In a fast-paced climate marked by continuous change, the C-suite seems to be the place most ready to initiate and adapt. Or, to put it another way, they understand that the mindset needed to launch a company is no different than the one needed to sustain it.
The data also debunks two popular myths. Think entrepreneurs work more than everyone else? Think again. They averaged 46 hours per week, only one hour more than entry-level employees (45 hours) and seven hours short of C-suite execs put in. And being your own boss doesn’t necessarily mean higher wages. At $140,332, entrepreneurs make more than senior-level employees ($114,000). However, those earnings fall short of what the executive level ($148,000) and the C-suite ($203,000) earn.
ADVANCED BUSINESS DEGREES INCREASE EARNING POWER
If money is your motivator, here’s some good news. Ninety per cent of respondents in GMAC’s survey agreed that a graduate management degree increased their earning power. In fact, over three-quarters believe their salary is fair and competitive (and another 74% were satisfied with their benefits package).
And that’s brings up a question: where is the best place to maximize your earnings potential? Well, it’s still a large American company. While the median pay for a mid-level job in a firm with 1,000 or more employees is a shade under $100,000, moving into senior and executive level roles has its perks. And the biggest one is that graduates earn a median from $100,000 to $180,00 . . . with those in the 75th percentile making over $200,000. Overseas, Asia is your best bet, with senior and executive level leaders earning medians from $100,000 to $150,000.