Reading Academic Research Papers Is the Best Success Hack You've Never Heard About Graduate-level research is a lot likelier to help you figure out real life business problems than that book of motivational quotes beside your bed.
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Despite the bad rap it tends to get in the self-made businessperson community, college is still an entrepreneurial hub. Billion-dollar founders like Mark Zuckerberg, Michael Dell, Bill Gates, Larry Page, Steve Wozniak and many others started while still in college. They went to build some of the most valuable companies in the world. Incubators, mentoring, equipment, education and access are a few of the benefits gained by starting a business in college.
True, iconic entrepreneurs like Apple's Steve Jobs have been proudly vocal about dropping out of college (Jobs dropped out only six months into his freshman year; Gates and Zuckerberg didn't finish either), and while the growth of some of the companies sometimes outpaces the graduation of their founders -- leaving entrepreneurs with a career decision -- education certainly never stops in classrooms.
Gates describes reading as one of the "chief ways" that he learns. On average, he reads about a book a week. Warren Buffett reads more than 500 pages a day. When Elon Musk was asked how he could build rockets, he said, "I read books."
As a doctoral candidate and founder of two businesses, education played a very important role in my entrepreneurial career. Although a common question I am usually asked is how I could manage the responsibilities of pursuing a PhD while running two ventures, I strongly believe that, in the contrary, my education contributed directly to my business success.
There's an underused and yet massive online library of knowledge that I want to introduce you to or remind you of today: Google Scholar. It's estimated that Google Scholar indexes more than 160 million research-backed articles. Entrepreneurs can benefit massively from rigorously researched questions in psychology, finance, marketing, management and more.
Here are five articles I recommend in five different business areas.
1. Business performance.
"Improving New Venture Performance: The Role of Strategy, Industry Structure, and the Entrepreneur," by William Sandberg and Charles Hofer
Sandberg and Hofer study the effect of the characteristics of entrepreneurs, industry structure and business strategies on new venture performance. They find evidence that the success of the business venture can be enhanced by specialization on any of theses three factors: entrepreneur, industry structure and strategy. Essentially, becoming exceptionally well at one instead of doing OK in all will give you the edge. They further show that a differentiated strategy, one that represents a competitive advantage, is not always the best strategy.
"Cognitive Mechanisms in Entrepreneurship: Why and When Entrepreneurs Think Differently Than Other People," by Robert Barona
Barona shows how entrepreneurs' thinking may be more susceptible to various kinds of cognitive errors and biases than other people. In the article, he discusses the escalation of commitment and self-justification biases, the planning fallacy, affect infusion, counterfactual thinking and more. Awareness of these biases and cognitive errors can significantly affect the outcome of your decision as an entrepreneur.
"The Capital Structure Puzzle," by Stewart Myers
If you're seeking venture funding for your startup, Myers argues that equity should be the last funding resort. In other words, financing operations using retained earnings or your own savings is much cheaper than seeking debt with equity being the most expensive funding medium since you are giving away a portion of your company. Scroll down to the Pecking Order Theory in his paper to read the different funding scenarios. Although his assessment and analyses address publicly traded firms, the arguments and findings can also be applicable to private companies or newly launched ventures.
"Undervalued or Overvalued Customers: Capturing Total Customer Engagement Value," by Vivek Kumar, Lerzan Aksoy, Bas Donkers, Rajkumar Venkatesan, Thorsten Wiesel and Sebastian Tillmanns
The lifetime value of the customer (CLV) is the amount earned from customers over their entire relationship with the business. The authors of this paper propose a comprehensive measure of customer value beyond its monetary aspect. They assess the value of the customer based on their purchase behavior, referrals, influence and knowledge. Altogether, the customer engagement value (CEV) and its measurement metrics can provide a clearer picture about the value of the customer to the firm.
"Business Models, Business Strategy and Innovation" by David Teece
In this article, Teece explores and advances understanding the connection of business models to strategy and innovation management. He notes that many great technological achievements failed to build a viable business because little attention has been given to designing a business model that's more than a "logical" way of doing business. Although the right business model may not be apparent early on, the hypothesized model must consider the business ecosystem and how it might evolve.
In his 2005 Stanford Commencement address, even Jobs praised certain academic experiences for his future forward motion -- in this case, a calligraphy class: "None of this had even a hope of any practical application in my life. But 10 years later, when we were designing the first Macintosh computer, it all came back to me. And we designed it all into the Mac. It was the first computer with beautiful typography. If I had never dropped in on that single course in college, the Mac would have never had multiple typefaces or proportionally spaced fonts."
No matter what field you might be in and whether you are starting a new endeavor or growing an existing one, we're living in the age of ubiquitous information. Nonetheless, we'll always have questions. While books present an opportunity to dive into the author's journey, research papers are a great way to discover and explore studies, findings and insights.