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The Nonprofit Online Helpers

March 30, 2012

The current technology-driven upheaval in higher education has created new markets of students who cannot or will not commute to and from a physical campus.

It has also created a new market of colleges -- particularly small, traditional ones -- that sense they must adapt to the rise of online learning and corporate management practices or get trampled underfoot.

Excelsior College, which has focused on distance learning since its founding in 1971, was one of the first colleges to tap the market of far-flung students who want to learn online. Now Excelsior, through a nonprofit spinoff called ESE, is trying to be the first nonprofit institution to tap the new market of traditional colleges that are late to offering online programs and need help.

In the last two decades many companies have emerged to meet the demand for expertise in transposing face-to-face curriculums into the online world. A steadily growing number of firms, such as Bisk Education, Embanet-Compass, 2tor, Deltak, Academic Partnerships, Colloquy and LearningHouse, have successfully tapped into a market of traditional institutions feeling the pressure to take their academic programs -- and their brands -- global in a higher education economy where scale has become a watchword.

But some institutions, particularly those that have hesitated until now to pull the trigger, are nervous about tapping a large, for-profit firm to hold their hands as they leap into the unknown of online education, says John F. Ebersole, the president of Excelsior.

“There’s a reason they’re late to the online arena,” says Ebersole, “and a lot of that has to do with their faculty and skepticism they have about the for-profit community.”

Hence the New York nonprofit’s new venture, ESE, which is short for “educators serving educators.” (It is also a pun on the word “easy.”) The idea is to signal to potential clients that ESE is just like them -- and that it has no intention of pushing them to do anything that compromises their mission and will not steer them toward strategic decisions based on what will generate the highest returns.

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So far ESE has landed at least seven clients: American International College, Castleton State College, the University of New Haven, Philadelphia University, The Sage Colleges, Western New England University, and Wheelock College.

The arrival of ESE as a service aimed at a specific segment of the aspiring online market -- i.e., small colleges for which interfacing with a fellow nonprofit might palliate some of the typical anxieties about going online -- is part of a new trend that has seen these online helpers home in on niche clients, says Richard Garrett, managing director of Eduventures, a consulting firm. He points to HBCUs Online, which works with historically black colleges, and 2tor, which has increasingly sought “elite” partners. LearningHouse has largely focused on the small-college demographic that ESE hopes to make its bailiwick. But ESE “certainly [is] distinct,” Garrett says. “As far as I know it’s the only nonprofit school offering this kind of service.”

Working with Excelsior’s nonprofit spinoff does not mean steering clear of for-profit online service providers. ESE acts as a general contractor, subcontracting the accouterments of an online program -- market research, lead generation and recruiting, instructional design and an online learning platform -- to various companies in its Rolodex.

Where ESE differs from the for-profit contractors are the terms and duration of its contracts. Companies such as Bisk and Embanet-Compass often lock college clients in to contracts of 10 years or more, to increase the likelihood of a high return on investment.  While some clients, notably Regis University and Saint Leo University, have successfully cut the cord without re-upping for another decade, some institutions might fret that such long-term partnerships might cause colleges to become too dependent on the companies that co-run their online arms.

ESE’s contracts will typically last five years, Ebersole says, with the explicit goal of preparing the client to stand on its own feet by the end of that contract. The client bears no risk; if ESE and its subcontractors fail to build a stable, successful online program, Excelsior swallows the bill and the client college keeps its intellectual property.

This figured prominently in ESE’s success in landing Wheelock as one of its first clients. Wheelock, a Boston-based college with under 1,000 undergraduates, considered several suitors but was impressed by ESE’s nonprofit pedigree and its enthusiasm about handing over the reins as soon as possible, says Julie Wollman, the vice president for academic affairs there.

“Nobody else said that,” Wollman told Inside Higher Ed. “[ESE] wanted us to be independent, and other companies wanted us to be dependent on them for longer.”

Ebersole, who worked amiably with Embanet (prior to its merger with Compass) to help take Boston University’s program online when he was an associate provost there, says he does not think working with for-profit providers necessarily forces colleges to compromise their missions.

But intangibles such as trust and comfort do count for something. Several of ESE’s initial partners cited the venture’s nonprofit status as a factor in their decisions to opt for the Excelsior subsidiary rather than one of the more experienced for-profit alternatives. “I think some of it does come down to a matter of trust,” says Susan Scrimshaw, the president of Sage Colleges. “And I think that’s true in any partnership.”

The trust factor can be especially salient at institutions for which a successful transition to online education can come only with significant buy-in from the faculty’s old guard.

“In every single case where an online effort has failed, it has been because of the failure to bring the faculty along with it,” says Ebersole, pointing in particular to the collapse of the University of Illinois Global Campus.

Although ESE is strategically positioning itself as a preferable alternative to for-profit companies offering similar guidance, Ebersole and some of ESE’s early clients emphasized that those companies are generally good at what they do. And there is no hard evidence suggesting that partnering with for-profit providers have adverse effects on a college -- or that a nonprofit partnership would result in higher quality programs and practices.  “There’s no objective view on this as yet, no performance data we can compare side by side,” says Garrett, the Eduventures director.

In the absence of such data, Excelsior’s “educators serving educators” tack might indeed prove effective.

“We’re dealing with perception versus counter-perception here,” he says.

“The reality will come down to: Do the people gel, and are people respecting each other’s goals and strengths?” says Garrett. “And that can go badly no matter what a firm’s commercial or noncommercial status.”

For the latest technology news and opinion from Inside Higher Ed, follow @IHEtech on Twitter.

 

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