Academic administration

Essay on what nonprofit higher ed can learn from for-profit sector

Once little more than a blip on the radar of American higher education, for-profit colleges now enroll about 1 in 10 of the nation’s postsecondary students. And this fast growth has not gone unremarked. The past year has brought unprecedented scrutiny and often harsh criticism of proprietary education from policy makers, regulators, and the news media. Unfortunately, too little attention has been paid to the innovative practices the best for-profits have to offer -- and how such reforms could help the rest of the higher ed world.

For-profit detractors are, of course, not entirely wrong when they complain of dubious recruiting tactics, overblown employment promises, and sky-high student-loan default rates. The sector is under heavy pressure from investors for fast growth and profits, and its expansion has been fueled by the easy availability of a large pool of federal aid. However, at a time of soul-searching about the ability of conventional colleges and universities to serve increasing numbers of students more effectively, for-profits should not be written off.

For a new white paper on private enterprise in American education, I interviewed a small collection of professors, deans, and presidents who have worked in both sectors to gather their firsthand reflections on what distinguishes the two educational universes. They were almost all quick to acknowledge the flaws of some for-profit colleges. But they drew from personal experience – at institutions including the University of Texas, Princeton University, the California State University, the University of Phoenix, and Kaplan University – to argue that the sector has many virtues as well.

These academics observe, first, that these relatively new colleges distinguish themselves, beyond their obvious goal of making money, by their targeted efforts to serve nontraditional students. Many who enroll are working adults with children, members of racial and ethnic minorities, first-generation college students, or all three.

Given the practical orientation of such students, for-profit leaders focus on building convenient campus locations, creating many online courses, and establishing market-driven, career-oriented degree programs. They emphasize data collection and systematically measure learning outcomes. And they are willing to standardize curriculum and minimize faculty autonomy to a degree that is much rarer in conventional colleges and universities.

The focus on meeting the needs of the labor market is a key philosophical dividing line between for-profits and their peers, particularly traditional research universities, according to Harold Shapiro, former president of Princeton and the University of Michigan. Shapiro is now board chairman of DeVry, Inc., which owns DeVry University, Keller Graduate School of Management, and other for-profits. "In elite higher education," he says, "you think you know what people need, so you produce that. You’re not out there asking firms and customers, 'What do you want?'… Whereas at a place like DeVry, which is much more focused on career education, management is out there all the time talking to businesses, asking 'What do you want?' "

For-profits also do something unusual in many traditional colleges and universities: they evaluate new hires on their teaching skills and give new instructors pedagogical training. Once on the payroll, instructors are evaluated much more systematically than their peers in traditional academia, even those who work at teaching-oriented colleges.

That’s in part because the culture of faculty independence in mainstream academe can make even casual evaluation difficult, says Thomas Boyd, former associate dean of the business school at California State University at Fullerton, and now dean of Kaplan's business school. "It was sort of a protocol that you had to walk on eggshells when you talked about what they were doing in their classroom. Of course you couldn’t go into the classroom and observe a professor. You could ask their permission, but you couldn’t drop in on classes. That was considered very inappropriate, to watch how they were teaching."

Perhaps the biggest appeal of for-profits for those who have joined the sector is that they are so new – works in progress in which trial-and-error is encouraged and inevitable. Entrepreneurial for-profits can move much faster to create new programs, adjust staffing levels, and change curriculums.

Michael Offerman, a onetime dean of continuing education at the University of Wisconsin-Extension who later became president of Capella University, says he was struck when he joined the online university by its ability to create new programs, such as the company’s development of "curriculum maps" tailored to skills valued by employers, accompanied by comprehensive measurement of whether students are in fact learning those skills. "The issue isn’t that for-profits are so much better at this," says Offerman. But their newness and distinctive mission "allows us to innovate and experiment in ways that I didn’t see happening as much when I was in public institutions."

Taken individually, these approaches aren’t unique to for-profits. But there is good reason to believe that such practices, when used together on a consistent basis, have particular value -- value that extends well beyond the for-profit context. For-profits will certainly need to work hard to prove their worth as they remain in the regulatory and media spotlight for the foreseeable future. But for all their flaws, for all the dismaying practices and bad actors that continue to be associated with the sector, their innovative characteristics are well worth studying. Traditional colleges and universities will be badly mistaken if they assume that the travails of for-profits today mean that profitable lessons cannot be drawn from their successes to date – and those likely to occur in the future.

Ben Wildavsky, a senior scholar in research and policy at the Kauffman Foundation, is co-editor of Reinventing Higher Education: The Promise of Innovation (Harvard Education Press, 2011) and author of The Great Brain Race: How Global Universities Are Reshaping the World (Princeton University Press, 2010). This essay is adapted from "Crossing to the Dark Side?," a new paper he wrote for the American Enterprise Institute’s series on private enterprise in American education.

Institutional Performance in Higher Education

Tue, 05/15/2012 to Wed, 05/16/2012


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Essay on how to enjoy a sabbatical

Sybil L. Holloway considers the roles of planning, preparation and setting reasonable expectations.

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Essay on how everyone can help erase student debt

Faculty members and administrators know on some level that their students are being saddled with lifelong student debt, but little is being done collectively across academe to deal with that embarrassing fact.

This fall ABC News anchor Diane Sawyer aired a report stating that 6 million Americans owe $950 billion in student loans, a sum greater than the entire credit card debt in this country. The report included interviews with graduates forced to live with their parents because of student loan debt.

To understand why, research your discipline’s starting salary vs. the average student debt at your institution. Then imagine yourself as one of your graduates paying monthly bills that vary according to state/city averages for student loans, apartment rent, car payment, fuel/transportation, utilities, and food and health-related expenses. You can use search engines for average data for your region as well as calculators for adjusted gross salary and student loan repayment.

After viewing the ABC News report, I did this exercise and found that journalism students from Iowa State on average will pay between $2,500-$3,000 per month for living expenses (assuming their employers cover medical insurance). That requires an income after taxes and Social Security of $26,000-$36,000 per year. Unfortunately, the average salary for a journalist in Iowa is $26,466, with a starting salary of $21,796. This explains in part why many graduates lessen expenses by living with parents (or move out of state for higher-paying jobs) and why those parents are irate about high tuition rates.

This is a national crisis. Fully two-thirds of college seniors who graduated in 2010 had student loan debt, an increase of 5 percent from the previous year, according to the latest report just released by the Project on Student Debt.

That report shows that my state of Iowa ranks third in the nation with an average student debt of $29,598. Some 72 percent of Iowa graduates have debt, ranking us fourth in the nation in this category. Worse, my land-grant institution — Iowa State University — is listed as one of the top high-debt public universities, with an average debt of $30,062 for the 69 percent of students graduating with debt.

This article is not about my institution. It is about yours. It doesn't matter if you work in a high- or low-debt state or university. You can do something now to ease the burden on students and make education more affordable rather than rely increasingly on higher tuition or annual appeals for more allocations from regents, trustees and legislatures.

Here are recommendations sorted top-down by rank:

Regents and Trustees: Understand the inner workings of your universities (including the status-quo disclosures below) but above all keep watch for "mission creep," especially by administrators of regional or lower-reputation institutions. They may have been founded originally for specialized purposes — such as teaching, nursing, agriculture, engineering, liberal arts, etc. — but aspire to be more comprehensive, competing with existing colleges. Mission creep also concerns how many employees are doing something other than teaching. A New York Times piece analyzed higher-education advertisements and found postings for "vice president for student success, residential communications coordinator, credential specialist, dietetic internship director, director of active and collaborative engagement, and coordinator of learning immersion experiences." Do an inventory of such positions at your institutions and evaluate whether these positions are more important than faculty members in classrooms.

Presidents: Leaders of institutions earn ever higher salaries in part by concentrating on fund-raising while allowing provosts to run the institution based on the added administrative title of "provost and executive vice president." When raising funds, presidents should focus more on student scholarships than on new buildings or programs that often fall outside the traditional mission of their institutions. They also should revisit organizational structures to see if their current configuration is financially viable. In the past, vice presidents for finance exercised budgetary oversight with authority over provosts who were the titular heads of the professoriate and often argued on their behalf, a task now largely left to unions and faculty senates. At the least presidents should take a more active role in overseeing how provosts allocate funds to academic units to ensure that priorities help ease student debt.

Provosts: In many states and institutions, provosts control how the increase in higher tuition is allocated. For instance, if tuition is raised by 3 percent, that extra money (often in the millions) might be dedicated to scholarships, student services, and special initiatives. The era of special digital initiatives, in particular, has ended after a decade of proliferation. See my 2008 IHE article about that. Rather, provosts should focus new money on scholarships to ease debt and maintain faculty salaries in as much as new searches drain the institution of funds and expertise. Also, if appropriate, they should modify budget models to reward units for graduation rates of 4-4.5 years. They can use timely rates to generate higher enrollment, especially in difficult economic times.

Chief Information Officers: Require technological assessment, reining in expenditures by academic units and teaching centers that waste student fees on gimmicky digital and virtual initiatives. What departments need now more than ever are IT specialists dedicated to maintaining systems, creating programming and repairing equipment. Find out which academic units or centers are spending student technology fees for gaming and role-playing applications, questionable clickers, pricey statistical analysis applications and other non-priority software. End funding for any non-educational item, and demand assessments with empirical data to support existing educational items to prove that indeed they are enhancing learning and/or research. See my 2008 Chronicle of Higher Education article for assessment specifics.

Deans: Reorganize academic units. Too many service departments with few actual majors may generate high student credit hours. But that is no reason why those programs also should be offering degrees requiring phalanx of adjuncts and graduate assistants teaching service courses while continuing professors handle small-section courses for minuscule cohorts. By reducing the number of small-major degrees, your colleges can dedicate tuition funds to high-priority programs with strong enrollment. See my 2011 IHE article on specific actions you can take to cut college expenditures.

Faculty Senate Officers: Some faculty senates realize that curricular glut increases workload. Other senates are oblivious to that basic fact, approving new courses each year without removing others that are antiquated, too narrow, or otherwise duplicative. Every faculty senate should have a curriculum council that oversees duplication and requires departments to justify not only the pedagogical arguments for the new course but also whether other units with similar courses have signed off on the proposal. Curriculum councils should ask how the unit will underwrite new courses without increasing workload for colleagues. See my 2008 Chronicle of Higher Education article for details.

Department Chairs: Raise external money. Do not use supplemental teaching funds for professor travel or development, because that reduces the number of courses you can staff, delaying degree progress for your students. Instead, get a donor to finance travel and development. Do not spend departmental funds for guest speakers but invite alumni or create an endowment for that. Make scholarships a priority to reduce debt. See my 2008 IHE article for fund-raising recommendations.

Faculty: Do not request course releases for vita-building activities such as journal editing or academic association appointments. Get a grant and buy yourself out or do the extra work without expectation of teaching less. Do not create courses associated with your research that few majors want. Do not insist on teaching small-section classes. If you publish textbooks, dedicate royalties for one book to be deposited directly to a scholarship fund in your name. (One of my textbooks has raised thousands of dollars for scholarships.) If you blog in your spare time, as I do, and have hundreds of followers, do not accept advertisements. Instead, ask your viewers as I will in 2012 to donate funds to your institution for scholarships.

Staff: Support personnel (budget and purchasing officers, IT specialists and secretaries) know perhaps more than anyone how to eliminate waste of public and private funds. Unfortunately, these employees are usually not empowered to make complaints to their immediate supervisors or have their budget-saving ideas considered regularly by upper administration. Advocate to your administration, employee councils and/or unions for the creation of a hotline to report abuses and of a digital suggestion box that rewards budget-saving ideas, especially those that can lessen student debt.

Everyone: Stop justifying the status quo concerning student debt by identifying weaknesses in the statistics of the Project on Student Debt. This is not U.S. News & World Report Best Colleges rankings, but documentation of actual problems verified by news organizations and government loan default data. Stop thinking this is not your job, especially if you are faculty or staff. Leadership is not a top-down phenomenon. Be courageous and prepared for pushback or worse by the very nature of addressing this issue. There are federal and state whistleblower statutes associated with reprisals for disclosures of mismanagement and waste of public funds.

At the start of the new year, let’s resolve to do what we can to lower tuition and ease student debt. Collectively, we can address these issues by making a commitment without excuses, justifications or finger-pointing. Many institutions have made such a commitment to sustainability initiatives, which also indirectly reduce debt through cost-savings. However, the biggest sustainability concern in our time just might be access to education and the value thereof after graduation.


Michael Bugeja is director of the Greenlee School of Journalism and Communication at Iowa State University. Bugeja chairs the Contemporary Leadership Committee of the Association of Schools of Journalism and Mass Communication.


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