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A Controversial Investment
$10 million investment by U. of Texas in technology company with ties to a former chancellor and scant evidence of impact on graduation rates has raised eyebrows.
The University of Texas Board of Regents is facing mounting criticism over its decision to take a $10 million stake in a technology that it believes will help improve the system’s graduation rate, then mandate that various campuses integrate it into their academic advising plans — all without consulting the individual campuses or their faculties.
The board voted in August to form a partnership with MyEdu, a private company based in Austin that acquires information about courses and professors at public institutions through website “scraping” and public-records requests, then provides that information to students on its own website. One of MyEdu’s more controversial features is a tool that displays the average grades, and grade distributions, for different professors and courses at an institution. It also allows students to post comments about professors and courses and offers tools that help students map out a path to graduation.
“It really is all about graduation rates,” said Frank Lyman, a senior vice president at MyEdu, in an interview on Tuesday. The six-year graduation rate at the University of Texas varies campus-to-campus, but overall it hovers slightly above 50 percent, Lyman said. “The regents have taken this as a key initiative, as a system, to address this.”
To start, the board has instructed three University of Texas campuses — Austin, Arlington, and Permian Basin — to work MyEdu into their plan for ushering students across the finish line. The idea is that academic advisers at those institutions will encourage students to use various scheduling, financial planning, and degree road-mapping tools on the MyEdu website, according to Pedro Reyes, the associate vice chancellor for academic planning and assessment for the system, who has been charged with coordinating customized implementations at each of the campuses.
But the board did not simply decide to instruct its campuses to use the company’s tools, which are free (the company makes money through advertising on the site). It also decided to stake a 22.5 percent ownership stake in the company, investing $10 million from its endowment. And that is what has rubbed some officials on the individual campuses the wrong way.
At a meeting of the Austin Faculty Council on Monday, a number of professors were dubious about the system’s decision to invest in MyEdu. Several said they had found some information on the website to be inaccurate or out-of-date, and some worried that the site’s emphasis on the historic grade distributions for different courses and professors might encourage students to chart a path of least resistance.
Alan Friedman, an English professor and chair of the council, told Inside Higher Ed on Tuesday that he knows students already sometimes hunt for the “easiest” available courses and professors. “But why spend $10 million to encourage it?” he said.
“There’s great deal of annoyance, to put it mildly, to spend all this money on something that seems worthless to us when the system’s been crying financial poverty over the last couple years,” Friedman added.
The Austin campus already has tools to help students browse courses and plan their degree paths, he said. “If they spend enough money, enough input, and enough time, they might eventually get to the point where they do it nearly as well as what we’ve already got,” Friedman said. At the very least, he said, the board should have left the decision on adoption -- a matter of academic strategy -- up to individual campuses.
The system office responded by emphasizing its intent to allow individual campuses to mold MyEdu to its needs. "One of the key decision points on purchasing MyEdu was the contractual commitment from MyEdu to customize the product for the students at each of the fifteen campuses and to customize the product for the administrators, faculty and advisors at each of the fifteen institutions," said Anthony de Bruyn, the assistant vice chancellor for public affairs.
At the same Faculty Council meeting on Monday, William Powers Jr., the president of the Austin campus, distanced himself from the board's decision to invest in MyEdu.
“Would I have had different priorities for that money? Yes,” Powers told the faculty, according to the Austin American-Statesman. “We didn’t choose to bring this to the campus.”
Adding fuel to the fire has been suggestions that the board had a conflict of interest because it was co-founded by John Cunningham, the son of William Cunningham, a former chancellor of the system. The younger Cunningham serves as the company’s vice president for information architecture. The elder Cunningham has made a personal investment of $175,000 in MyEdu, according to a report in the Statesman. The article also highlighted ties between MyEdu and Texas Governor Rick Perry. For instance, the article alleges that Michael Crosno, the CEO, served on Perry's re-election finance committee. (MyEdu denies Crosno's involvement in Perry's campaign. "Michael Crosno is not a supporter of Governor Perry and has never actively served on a Perry finance committee, participated in any fundraising related to Perry, or had any contact with the Governor or his campaign," wrote Lyman, the MyEdu vice president. "There is also a document on the Web that lists a Michael K. Crosno as a member of a Perry committee in 2009," he added, "but we are unaware of how Michael’s name came to appear on that document.")
Francisco Cigarroa, the current chancellor of the system, and Gene Powell, the chair of the Board of Regents, told the Statesman that they did not know about the former chancellor’s personal investment in the company, but said it would not have mattered if they did. "There are no conflicts-of-interest," du Bruyn, the system spokesman, wrote in an e-mail. "The vice chancellor and general counsel to the system and the general counsel to the board are responsible for vetting possible conflicts for members of the Board of Regents. In this case, there were no conflicts of interest. Texas law was precisely followed."
MyEdu, meanwhile, issued an outraged statement on Tuesday in response to the Statesman article, alleging that it contained “misleading information” and “gross exaggerations.” Asked to elaborate, Lyman told Inside Higher Ed that the company’s main objections stemmed from the report’s intimation that the partnership had been unduly influenced by the board members' connections to the Cunninghams, and charged that the Perry ties were overstated.
“While MyEdu has a passive investment from former UT chancellor William Cunningham, the implication that the deal was somehow influenced by a relationship with a chancellor whose term ended eleven years ago was clearly refuted by Dr. Cunningham on the record and in the article,” Lyman said. “Despite that evidence, the headline and content of the article implies an improper connection.
“We won’t accept the implication that our partnership with UT was somehow influenced by relationships with former chancellor Cunningham or Governor Perry. That is simply not true. This partnership was sparked by students, and should be judged on how well we serve their interest and support their goals of completing college."
But the deal does not pass muster on that criterion either, said Friedman, the Austin Faculty Council chair. If the board made its decision based on research showing a significant correlation between MyEdu and graduation rates, that would be one thing, he said. But the board has not presented the faculty with any data indicating that the platform will achieve what it says it will.
“It’s awfully speculative,” said Friedman. “You’re putting a lot of money into something that seems, on the face of it, to be worthless… Usually, for an investment, you want some evidence of likely success. That requires comparison, it requires laying out of what you hope to achieve, and evidence that it’s achievable. We haven’t seen any of this.”
That might be because MyEdu has not generated scientific evidence of a causal connection between its platform and higher graduation rates. “We have not done a research study that would be statistically significant,” Lyman told Inside Higher Ed. The idea that using MyEdu boosts completion “is more of a hypothesis” based on anecdotal feedback and “organic” popularity among students. (More than 75 percent of undergraduates at Austin are already registered with the service, he said.) When asked to cite what convinced the board that MyEdu would succeed in boosting graduation rates, de Bruyn did not refer to any data, but instead referred to the system's dearth of academic advisers. (He also underlined the fact that the $10 million investment was the smallest allocation the board made during its August meeting, amounting to $47.39 per student.)
The causal effect is indeed speculative, Lyman said, but it’s “common sense” to think better planning tools will help students be better planners, and that better planners are more likely to follow an efficient path to a degree.
Lyman did add that MyEdu is looking into charting its own path of study at the University of Texas, with the hope of doing research that will probe the correlation between the platform and student success. Asked whether the company might, for the sake of credibility, delegate that research to the faculty on the University of Texas campuses, Lyman said it was an option.
However, he noted, because of the university’s investment in MyEdu, the company might tap a private firm to avoid a potential conflict of interest.
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