Changing the Equation

Even before the current economic downturn, cost had become the dominant public concern about American higher education. As the president of a private college, it had also become my dominant concern. And with good reason: over the past decade, following the national trend, tuition at my institution increased at a faster rate than inflation, than the growth in family incomes, even faster than the increase in health care spending. Many of our students were graduating with considerable debt. It was obvious, as well, that cost was discouraging too many students from modest backgrounds from viewing my institution as a realistic option.

So each year we struggled with two decisions -- where to set tuition for the following year and how much institutional financial aid we should offer. We wanted to keep the college affordable but, at the same time, wanted additional resources to invest in our ongoing efforts to strengthen programs. But each year, after some gnashing of teeth, we opted to set tuition and institutional aid at levels that would maximize our net tuition revenue. Why? We were following conventional wisdom that said that investing more resources translates into higher quality and higher quality attracts more resources.

Among the colleges and universities I know best, quality is the main driver. And most people inside and outside the academy – including those who control influential rating systems of the sort published by U.S. News & World Report -- define academic quality as small classes taught by distinguished faculty, grand campuses with impressive libraries and laboratories, and bright students heavily recruited. Since all of these indicators of quality are costly, my college’s pursuit of quality, like that of so many others, led us to seek more revenue to spend on quality improvements. And the strategy worked.

Over the last decade, every available dollar we had from tuition revenue, as well as from enrollment growth and fund raising, was invested in traditional indicators of quality. We built new state-of-the-art facilities, hired great professors, gave generous scholarships to high-achieving students, maintained small classes, expanded our co-curricular activities and invested in a host of high-impact educational practices such as learning communities, service learning, and diversity initiatives. And our reputation for quality grew exponentially. Our applications have doubled over the last decade and now, for the first time in our 134-year history, we receive the majority of our applications from out-of-state students.

But our nagging concern about affordability wouldn’t go away. We didn’t need fancy economic models to realize that our college, along with so many others, was quickly approaching a very steep cliff. If we continued to raise tuition as we had in the past, more and more prospective students, even those who had their hearts set on attending our institution, would find that they simply could not afford to do so. It became clear that, unless we found ways to reduce our costs, and moderate our annual tuition increases as well, there was no way to avoid the cliff, no matter how quickly the economy recovered. We were caught in a classic “damned if you do, damned if you don’t” dilemma. No one wants to cut costs if their reputation for quality will suffer, yet no one wants to fall off the cliff.

I believe that, for the vast majority of colleges and universities, public as well as private, the elephant in the room is the cost structure of our academic programs. We don’t talk about it because of the perception that cost is inextricably related to quality, and no one is ready to sacrifice that. When quality is defined by those things that require substantial resources, efforts to reduce costs are doomed to failure.

But we know there is another way to think about quality. Beginning with Sandy Astin in the 1980’s and extending to Jamie Merisotis today, some of the best thinkers in higher education have urged us to define the quality in terms of student outcomes.

The notion of defining quality in terms of outputs rather than inputs, by the achievements of our graduates rather than the achievements of our entering class, had been a key element in the strategic plan my institution began developing in 2002. During the planning process, dissatisfaction with traditional models of education came to the surface. Faculty said they wanted to move away from giving lectures and then having students parrot the information back to them on tests. They said they were tired of complaining that students couldn’t write well or think critically, but not having the time to address those problems because there was so much material to cover. And they were concerned when they read that employers had reported in national surveys that, while graduates knew a lot about the subjects they studied, they didn’t know how to apply what they had learned to practical problems or work in teams or with people from different racial and ethnic backgrounds.

Based on those concerns, and informed by the literature on the “teaching to learning” paradigm shift, we began to change our focus from what we were teaching to what and how our students were learning. In the process, we broadened our conception of what students should learn by including more than subject-specific information. We established what we call college-wide learning goals that focus on "essential" skills and attributes that are critical for success in our increasingly complex world. These include critical and analytical thinking, creativity, writing and other communication skills, leadership, collaboration and teamwork, and global consciousness, social responsibility and ethical awareness.

Shifting our paradigm from teaching to learning enabled us to approach the question of cost in an entirely new way. Instead of assuming we needed all of the expensive accouterments of quality, we could focus our attention on those things known to have the most impact on student learning. And it doesn’t take long to discover that, despite claims to the contrary, many of the factors that drive up costs add little value. Research conducted by Dennis Jones and Jane Wellman found that “there is no consistent relationship between spending and performance, whether that is measured by spending against degree production, measures of student engagement, evidence of high impact practices, students’ satisfaction with their education, or future earnings.” Indeed, they concluded that “the absolute level of resources is less important than the way those resources are used.”

So we started searching the literature for instructional designs that require fewer resources and result in high levels of student learning. The ones we found shared certain characteristics. They were driven by clear learning goals and involved extensive assessment and feedback to students. They stressed active learning and took maximum advantage of technology. In each design, faculty spent less time lecturing and more time coaching, proactively asking and answering questions with groups of students. And faculty were assisted in their coaching role by teaching assistants or peer mentors. Finally, economies of scale helped to produce significant cost savings.

With these principles in mind, and with support and encouragement from my board, I decided to commission a demonstration project. I pulled together a team from our school of business and told them that the goal was to develop an undergraduate degree completion program in business that produced more and better learning at half the cost of our traditional program. After more than a year, the group had developed what we now describe as a low-residency, project- and competency-based program. Here students don’t take courses or earn grades. The requirements for the degree are for students to complete a series of projects, captured in an electronic portfolio, that mirror core activities in the business world. To complete each project, students must acquire and apply specific competencies – competencies identified as necessary to function effectively in a modern business. The list of competencies also includes all of our college-wide learning goals. Students acquire the competencies by accessing a rich repository of learning resources and activities that our faculty have compiled and made available online. These are enriched with multimedia features, communication and social networking capacities and contextually rich simulations and animations. Faculty spend their time coaching students, providing them with feedback on their projects and running two-day residencies that bring students to campus periodically to learn through intensive face-to-face interaction.

After a year and a half, the evidence suggests that students are learning as much as, if not more than, those enrolled in our traditional business program. Although it will take some time to fully evaluate this model, and to assess the true costs of delivery, the approach shows real promise.

One thing we are learning is that providing students with sophisticated online learning materials and supporting their learning with face-to-face interaction with faculty who are attuned to their different interests, orientations and learning styles can be a powerful combination. That’s consistent with a meta-analysis recently published by the U.S. Department of Education, which showed that students learn more in courses that combined online and face-to-face elements (called hybrid or blended learning) than they do in programs that are exclusively online or exclusively classroom-based. In short, the report documented that high-tech plus high-touch works best.

As the campus learns more about the demonstration project, other faculty are expressing interest in applying its design principles to courses and degree programs in their fields. They created a Learning Coalition as a forum to explore different ways to capitalize on the potential of the learning paradigm. They designed a problem-based general education curriculum for high-achieving students. They are using students as peer teachers in a number of settings. Every academic program has articulated a set of program-specific learning goals and is developing ways of assessing student progress toward these goals. And our business faculty members are designing a new M.B.A. program using a model similar to the one they used in the demonstration project.

There are hundreds of private institutions like mine that have longstanding and well-deserved reputations for maintaining high standards for student achievement and providing personal encouragement and support for students to meet those standards. High-touch is at the core of their educational philosophy. That is a costly model that I fear is unsustainable. I don’t know if hybrid or blended instruction will be the magic bullet that allows us to cut our costs and thus moderate the rate of our annual increases in tuition. It’s more likely that different programs will find different ways to integrate efficiencies, high-tech or not, into their largely high-touch designs. Some, like theater and studio art, may not be able to do so at all.

My institution will continue to experiment with different instructional designs until we find approaches that work for us. But I suspect we won’t have the luxury of time. There are enough for-profit and not-for-profit institutions that are quickly putting the pieces together to be in a position to mass-market multiple high-quality, low-cost degree programs that students of all types will find enormously attractive.

I don’t know how close we are to the edge of the cliff where we find we have priced ourselves out of the market. Perhaps the cliff is really a slippery slope that we have been on for some time. Or perhaps we’ll tap into a new and lucrative market, like many of us did twenty years ago when we developed programs for adults, which will enable us to subsidize our high-touch programs.

Trying to predict the future is fraught with risks. But I believe that private colleges, including largely residential colleges with modest resources, can survive the challenges ahead. There are many families who see great value in having their children leave home to have the holistic and often transformative learning experiences these schools provide. At the same time, I see danger ahead unless we can cut the Gordian knot between cost and quality. At the very least, finding innovative ways to lower costs without compromising student learning is wise competitive positioning for an uncertain future. The search at my college continues.