Monday, June 16, 2014

Rear Vision - The Market for Higher Education

ABC Radio National’s Rear Vision series has just run a useful documentary on the market for education  especially in the US. You can listen to the program here. I do not know if is available to people outside Australia.

I mention it because of the recent discussion threads here linked to Minister Pyne’s proposals, the economics of education, the structuring of Government funding (if any) that should be provided to support education and especially higher education and, if so, how.

If you can access it, I think that it’s worth a listen. 


Another story from this morning that I wanted simply to record at this  time: Working age Australians have become far less reliant on welfare payments, new figures show.

Postscript 2

kvd found this piece by Jill Lepore in the New Yorker: THE DISRUPTION MACHINE. It makes for depressing reading, at least for me. Over thirty years in senior management or as an adviser to management, I have seen so many management fashions. Some I have supported, others made me cautious because they seemed just too simplistic, too partial. I find it ironic now that a fair bit of my professional or semi-professional writing attempts to address the continuing dead hand of things I once supported!

Postscript 3

Evan pointed me to this response by Professor Clayton Christensen to the Lepore piece: Clayton Christensen Responds to New Yorker Takedown of 'Disruptive Innovation'’



Evan said...

So many issues not investigated or examined.

People dropping out? If you finished first year philosophy at Sydney Uni you were sure of passing because so many dropped.

Of those 'unsuitable' people who were recruited how many passed?

Do we need a discussion about this!

Jim Belshaw said...

I agree a discussion is warranted, but my concern is partly to educate myself!

Anonymous said...

A long New Yorker article, which I believe is worth considering in any discussion of innovation in education - or any innovation, really:


Jim Belshaw said...

Thanks, kvd. Will read tonight.

Jim Belshaw said...

I have now read that article, kvd. It's actually depressing along multiple levels, including the way yet another management fashion interferes with common sense.

Anonymous said...

Sorry to read that you seem to have just scanned the writing, Jim. I thought it quite supportive of your own position re education:

Innovation and disruption are ideas that originated in the arena of business but which have since been applied to arenas whose values and goals are remote from the values and goals of business. People aren’t disk drives. Public schools, colleges and universities, churches, museums, and many hospitals, all of which have been subjected to disruptive innovation, have revenues and expenses and infrastructures, but they aren’t industries in the same way that manufacturers of hard-disk drives or truck engines or drygoods are industries. Journalism isn’t an industry in that sense, either.

Doctors have obligations to their patients, teachers to their students, pastors to their congregations, curators to the public, and journalists to their readers—obligations that lie outside the realm of earnings, and are fundamentally different from the obligations that a business executive has to employees, partners, and investors. Historically, institutions like museums, hospitals, schools, and universities have been supported by patronage, donations made by individuals or funding from church or state. The press has generally supported itself by charging subscribers and selling advertising. (Underwriting by corporations and foundations is a funding source of more recent vintage.) Charging for admission, membership, subscriptions and, for some, earning profits are similarities these institutions have with businesses. Still, that doesn’t make them industries, which turn things into commodities and sell them for gain.

Still, you say you've read and absorbed the content, so I stand corrected as to your position:

you disagree with a writer who disagrees with those disagreeing with you.


Jim Belshaw said...

Don't misunderstand me, kvd. My comment and addition to the post were quick responses.

I read the article in detail and several times. It does indeed support my position. That was, in fact, the cause of my depression! Its another example of some of the things that I have been complaining about.

I will probably bring up a more detailed response later. For the moment, I just wanted to get it into my own part of the public space.

Anonymous said...


There are several concepts in that essay that I found interesting, provocative. (And also my own reaction - and how it changed from objection to cautious agreement with the writer - that was also interesting; the writer writes well!)

Maybe I post too many links? In my defence I (hope I) only post links to stuff I think is worthy of thoughtful consideration.


Jim Belshaw said...

It was a good piece. I had reservations about balance, but she does write well. And, no, you can never post too many links from perspective!

Winton Bates said...

Jill Lepore seems to be making the point that we should not worship disruption. So what? I suppose there are still some revolutionaries around who think disruption is an end in itself and some people might still need to be persuaded not to put their faith in revolutionaries. But when I ask myself what are the implications for public policy, I come up with a blank.
Surely we want an open society in which people are free to innovate rather than one in which innovation is prevented because it can be disruptive.

Jim Belshaw said...

While kvd can respond on his own behalf, Winton, I don't think that your last sentence has any connection with Lepore's argument. Lepore is talking about the blind application of a management fad or silver bullet, the latest in a line.

The implications for public policy? Well, leaving aside the higher education example for the moment, the disruption paradigm is affecting management and consequently economic performance at all sorts of levels. UNE is an example at a micro level, but it flows across into public policy and administration in all sorts of ways.

Lepore suggests that the disruptionists distinguish between continuous improvement (doing what we do now better) and disruptive change. Innovation in the first is not enough, the big gains come with the second. This is sort of a distorted Schumpeterian model. The problem is how do you get the first if you not only deny its validity but create conditions that preclude it?

Jim Belshaw said...

Winton, just a brief follow up comment. I was writing today's post when you comment came through. I may bring it up today or tomorrow at today's date.

I get so frustrated. I was at a meeting this week where the Chief Executive kept referring to her small agency as "the business". Its not, in fact, a business at all, although it needs to be run in a businesslike way.

That agency is part of a bigger agency. There, too, the same phrase is used. To get consistency in vision, mission etc, the bigger agency has developed a definition of its role that absolutely twists the role of the smaller agency.

The bigger agency works in a world where the structures and philosophy are twisted by jargon, by popular concepts, some of which have a loose connection to economics, a bigger connection to conceptions of the role of the state and the way that should operate.

The whole thing is set within a corporatist model that somehow combines the worst elements of management and economic fashions.

Yes, I know that sounds jaundiced, but I believe it to be true. The whole system is bound up in rules and controls including IT systems designed to assert central control and maintain probity. They also shift costs so that central functions that can be measured appear less costly, those that cannot be measured bear the cost.

Part of the argument for those systems is that they allow more delegation; people are freer within the rules to do their own thing, but only within the rules. The practical effect is constipated decision making and higher costs.

Continuous improvement becomes impossible. There is lots of disruption and instability because of external forces, but no-one can respond in a sensible fashion.

I could both cut the costs of administration and improve effectiveness, but it would require fundamental systemic change. Just to put a number on it, I reckon I could cut the costs of public administration and program delivery by between 10 and 15%. It's not going to happen. It requires people to give up control, to accept risks including abuse of the system. It's not going to happen. All one can do is peck away at the margin.

Anonymous said...

Winton, Jim

I can only repeat that I thought there were several reasonable observations in that essay, and I did not seek to either support or oppose the writer's point of view. Perhaps it is wrong of me, but I have no trouble reading and assessing ideas I am potentially opposed to, without an immediate "it'll never fly" reaction.

But a couple of points I think worthy of mention:

1) the uncertain analysis between cause and effect: it seems to me in business (I have no 'public policy' expertise) that turning points, massive shifts, are only recognised in hindsight. I think it a fool's errand to massively disrupt hoping to cause a revolutionary change; more, in clear hindsight, we can see how certain events, innovations, have resulted in massive change. The example of mobile phones disrupting settled industry business models is an example.

2) I liked the writer's historic perspective on how our different "ages of advancement" might be summarised in simple words - disagree if you will, but I thought that rather well put.

3) Winton, I wouldn't disagree with your last sentence. But I'm wondering what in the essay, or in my earlier comment, provoked that reaction?

Anyway, I thought it useful to provide the link - particularly as one part of it dealt with the bothersome subject of higher education, which has been one of Jim's present themes. And a gentle dig, Winton: you seem to dismiss someone who on the face of it is agreeing with your view as to relevance? I really must get used to this new "enemy of my enemy is also my enemy" paradigm :)


Winton Bates said...

The relevance of my last sentence: It seems to me that it is futile to attempt to argue that any particular business model is best under all circumstances. In some circumstances disruptive innovation is desirable. In other circumstances continuous improvement is desirable. In some circumstances there may even be virtue in going back to the old ways of doing things.

An open society resolves the conflicts between organisations with different strategies by testing voluntary public support for different forms of organisation. Please note, this is not just a market test. For example, if traditional universities can manage to attract donations from private endowments to enable them to continue doing what they do in the way they done it in the past, good luck to them.

My general point is that it is reasonable to presume that organisations which manage to attract public support will survive in an open society. I am of course assuming the existence of normal legal protection against fraud.

As I see it, the main danger is not that shonky innovators might try to defraud consumers, it is that the advocates of the status quo will manage to enlist government support to discourage innovation.

Evan said...

Of interest?

Christensen's response.

Jim Belshaw said...

Thanks, Evan. Much appreciated. I will bring it up in the main post.

Anonymous said...

Following Evan's lead, kvd turned up several lengthy and quite thoughtful commentaries on the initial New Yorker essay.

And on Evan's link to Christensen's response, kvd thought he came over as a little petulant, and particularly felt it most strange when he began talking about himself in the third person. But on the other hand, it was a quick-grab news article more than a thoughtful response.

Anyway, I have very much enjoyed the many follow on articles from now a variety of writers. And this is how it should be with a theory apparently so widely utilised by corporations to justify such large scale destruction of "the way business is done".

Uncertain of application to higher ed tho' - but most I've read seem to support Jim's own short replies above as to its (the theory's) place in the cosmos...

ps ran short of apostraphes :)

Evan said...

Thanks kvd. I've read both the Innovator's Dilemma and the Innovators Solution.

The Solution is by far the better book.

Disruption, in Christensen's sense isn't quite the same as innovation. In the Innovator books the disruption is of the market and doesn't have so much to do with style of management. The Disruptor picks off the low hanging fruit for a much lower price with their particular innovation. How the company is run is secondary (if important at all.)

A disruptive innovation in education would be something like Phoenix - delivering the same product (a qual) at a much smaller price.

I wholeheartedly agree that managers got control of higher ed. The results of which look appalling to me.

I don't know if Christensen champions management lead stuff. If so I think he is at a good distance from reality.

It seems that (from our government's point of view) that the value people are meant to look for from higher ed is employment quals. Those who can deliver them cheaper would prevail - the government doesn't speak of any of the wider values mentioned in the final para's. It seems to me that the government is pushing the uni's toward the MOOC model, though those closer would know better (I'm working from conversations with a few friends).

Jim Belshaw said...

Thanks, all. I will pursue all this briefly in today's Forum post.