Sbi Clients' Perceptions of Student Consulting Projects: An Empirical Model (1998)

ABSTRACT Results are reported from a nationwide survey distributed to businesses that participated in the SBI consulting program in the 1992-1993 academic year. A multiple regression model is reported which indicates that clients' evaluation of the overall usefulness of SBI student consulting is affected by risk, perceived economic impact, and clients 'perceptions about characteristics of the teams. Also reported is a logistical regression model, which indicates that highly satisfied and less satisfied SBI clients differed in their perceptions of the risk and perceived economic impact of the teams' recommendations as well as in their evaluations of the teams' characteristics. INTRODUCTION Students in science can learn in a laboratory, psychology students can learn through laboratory or field experiments, archeology students can learn through participation at excavation sites, but opportunities for business students to apply their knowledge outside of the classroom are rare. High risk is involved when students are experimenting with business strategies for a preexisting business because mistakes could be ruinous. As a result, Small Business Institute (SBI) counseling, its impact on small businesses, and the clients' perceptions of the SBI program, have all been of continuing interest to academic researchers. This research reinforces the value of student consulting to both businesses and students. Aldiough federal funding for the SBI program has become a casualty of the current political climate, an inspection of the program and its results should yield useful information. This information is useful in those instances where the program continues through alternate funding. Small Business Institute Directors' Association (SBIDA) member schools still provide student consulting for small businesses funded by user fees, local community and state donations, or university funding (SBIDA, 1997). This research is also useful in that the experiences of client businesses that participated in the program offer insights into educating students about the business world. Finally, as more tiian one half of respondents to our survey would support some level of user fees for student consulting, insights about past federally funded SBI consulting would obviously be of interest to user-fee-funded groups. For these reasons, we posit that research concerning student consulting and small business clients is still viable. This paper reports on a nationwide survey conducted among businesses that participated in the SBI program in the 1992-93 academic year. First, we discusses research results, reported by others, concerning the impact of Small Business Development Corporation (SBDC) and SBI consulting on small businesses. Second, we discuss our survey methodology and sample selection. Third, we discuss the development of our OLS and logistical regression models. Finally, we report our conclusions and study limitations. LITERATURE REVIEW The SBI student consulting program and the impact of the SBDC have been studied by academic researchers. Motivations for prior studies have differed, but can be described by several common themes. Nahavandi and Chesteen (1988) focused on the kind of consulting provided to small businesses and identified reasons small businesses failed to implement SBDC recommendations. Chrisman, Nelson, Hoy, and Robinson (1985) attempted to measure increased tax revenues generated in Georgia and South Carolina by increased performance of businesses tiiat had been recipients of SBDC consulting. Ellstrott (1987) reported the results of a qualitative study of Louisiana businesses' satisfaction with the Louisiana SBDC program and suggested procedures for assessing the economic impact of SBDC counseling. Lang and Golden (1989) used stepwise regression to identify variables for a Data Envelopment Analysis of SBDC efficiency. Hoffman, Viswanadian, and Brennan (1997) developed a regression model to explain why schools continued or discontinued tiieir SBI programs. …