Business schools offer a wide range of degree programs to students interested in a career in the field. Some of these programs focus on business theory; others provide practical knowledge and skills. Comparing the characteristics of these two paths will help you choose which program is right for you.
What or How?
In the realm of business, theoretical knowledge involves learning and understanding the basics of how business works, what different processes are involved in running a successful business and how to stay on top of changes in those processes. Practical knowledge provides the tools and techniques necessary to put theory into practice. In a real-world business setting, the theoretical lays the framework for the practical to build on. This can be thought of simply as what needs to be done versus how to do it. Businesses need to establish a balance between the two in order to achieve success.
When starting a business, the theoretical always comes before the practical. You can’t launch a new company without knowing what the market is like and how your target audience is behaving. This knowledge is essential for creating projections for profits, losses and growth. Studying business theory gives you this knowledge and prepares you to follow trends as they develop. Business practice, on the other hand, guides you through the steps involved in achieving the goals set forth in projections and riding out any unexpected shifts in the market.
Business theory is much more about assessment than it is about practice. In a theoretical program, you may study economics, statistics, finance and market trends. By focusing on how these processes apply to and affect businesses, you gain a solid understanding of how companies operate and the ways they must adapt over time. Practical business programs involve skills that make you a desirable employee, team leader or manager. These may include communications, organization, management practices, technology or critical thinking. Some skills, such as leadership, overlap both types of programs, showing how closely these two branches of business study are related.
Since theory teaches the “what” and practice teaches the “how,” what you learn in each type of program is applied in different ways. Theoretical knowledge is the most beneficial in advisory positions that require a broad scope of understanding. Many business owners either lack this knowledge or have only grasped the basics and need help re-establishing the foundations of their companies. It’s the managers, supervisors and employees within these companies that make the most of the practical side of business. This kind of knowledge applies to the daily details of running a business, including marketing, customer relationship management, project management and order fulfillment.
If you’re interested in the financial and economic side of business and enjoy creating structured environments, a theoretical business program will put you on track for that type of career. You can help entrepreneurs build their startup companies or advise seasoned business owners on how to update their practices to take advantage of changing markets and consumer behaviors. If you’d rather spend your days in an office setting or a retail environment, interacting with clients and customers or working on projects, put your focus on practical business studies. Both programs can set you up for careers with great potential for growth.
Although most business positions involve at least some mix of the theoretical and the practical, it can be beneficial to focus on one or the other. Look for the program that provides solid knowledge and strong skills to support you in the career that you want.