Rich DeMillo has a lengthy background in academia serving as a professor at four different universities, Dean of Computing at Georgia Tech College of Computing, Director of the Computer and Computation Research Division of the National Science Foundation, and was Hewlett Packard’s first Chief Technology Officer.  His latest book, Abelard to Apple: The Fate of American Colleges and Universities, developed from a five page memo that he planned to send to his colleagues about what was wrong at his university then evolved to a whitepaper in which he solicited the advice of friends and colleagues, and eventually to a book. 

Unlike Clayton Christensen who writes about innovative companies as a Professor of Business Administration at Harvard Business School (thus making his transition to writing about innovative universities less surprising), DeMillo’s background is in engineering and computer science.  His observations, however, stem from his background as a professor at a traditional “brick and mortar” school.  From his position inside the hallowed halls of academia, he notes that the institutions in the middle, those between the elite institutions (top 75) and institutions that admit everyone, are the ones that are in trouble with a value proposition squeeze coming from above (elite) as well as below (business model to serve anyone or everyone at a lower price point).  DeMillo stresses that modern universities are businesses (contrary to some of the myopic ideologues who insist that non-profit institutions don’t have a business model) and are competitive organizations run by smart people.  Similar to Christensen, DeMillo argues that the class-oriented society and culture of higher education creates a faculty-centered model that is difficult to break out of for institutions undergoing competition for enrolled students.  (For a review of Christensen’s book, Disrupting Class: How Disruptive Innovation Will Change the Way to World Learns, see my August 2008 blog article.  To see my review of Christensen’s book, The Innovative University: Changing the DNA of Higher Education from the Inside Out, see my August 2011 blog article.)

DeMillo states that in any market, the winners are those with competitive brands, price, or value.  Brand is difficult to build for all but the elite colleges and universities, price continues to increase for almost all institutions and in most cases is becoming uncompetitive, and value is a concept seldom understood by the faculty at most institutions.  Because most college presidents are promoted from the ranks of academics, they are ill-equipped to understand the importance of strategic planning and understanding competitive threats from business disruptors like creative proprietary institutions.

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I read an article in the October 15, 2011 issue of The Economist entitled “Trouble in the Middle.”  The article begins by stating that interest in MBA programs at American business schools peaked in 2009 and applications have fallen since then.  The author states that some business schools are worried that the trend is related to more than just a slow recovering economy, but in fact a greater change.

The Economist presents data that may back the case that it’s not just the economy.  In examining data accumulated in their annual ranking of the top 100 MBA programs, they note that in 2010, the average cost of an MBA for the 85 schools outside of the top 15 was $81,911 while the average starting salary for the graduates of those schools was $81,178.  Five years earlier, the two year cost for the same 85 schools was $60,247 while the starting salary average was $78,442.  The attached graph shows that the disparity was greater ten years ago when the average starting salary was over $80,000 and the average cost was slightly less than $50,000.  The comparison could hardly be more dramatic; increasing costs of tuition have cut the noticeable advantage of attending a residential MBA program outside of the top 15. 

Elite schools like Harvard still have an advantage according to The Economist’s survey data.  Additionally, the article mentions a recent event at Harvard hosted by a large consulting firm where a member of that firm’s senior management noted while speaking to the faculty that the most valuable player on the Harvard Business School team was the Director of Admissions, a not so subtle reference to the elite students recruited to the school and subsequently recruited by that consulting firm.

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Articles about transformations in higher education are being published daily, it seems.    Many of them focus on affordability and the fact that the increasing costs in higher education in the United States cannot continue to exceed inflation or the increase in earning power of Americans.  Very few of these articles, however, offer solutions or examples of solutions to the high cost conundrum.

In the September issue of Fast Company Magazine, Anya Kamenetz writes an interesting article entitled “How Web-Savvy Edupunks are Transforming American Higher Education.”  She begins the article by discussing how the internet and various applications or sites such as Google, YouTube Edu, iTunesU, Wikipedia, and Facebook have changed the way all of us share information.

Yet while colleges like MIT have placed all of their coursework online for free, an MIT degree costs about $189,000.  She cites Jim Groom, an “instructional technologist” at the University of Mary Washington as stating, “Colleges have become outrageously expensive, yet there remains a general refusal to acknowledge the implications of new technologies.”  According to Kamenetz, Groom coined the term “edupunk” to describe the high-tech do-it-yourself education.

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Whenever I can find a good book or research paper on the topic of distance education, I will usually obtain a copy in order to see if there’s a trend or idea that is worth noting or pursuing.  For a few weeks, I had noted the ad in The Chronicle of Higher Education touting their new report, “The College of 2020:  Students.”  I had to pay for the report, so I’m sure that the Chronicle wouldn’t like it if I provided a blow-by-blow description of its contents.  However, I think that they would not mind someone touting the report on their blog, so my thoughts are summarized below.  (Those interested in purchasing the report can do so at the following site:  http://research.chronicle.com/asset/TheCollegeof2020ExecutiveSummary.pdf.)  

Chronicle Research Services released the first of a three part report last month that describes the characteristics they predict that we will see in college graduates of the class of 2020.  The fundamental themes of the report are that as the class of 2020 (today’s first graders) enter their college years, their demands on colleges and universities will be drastically different from what students have previously expected, forcing higher educational institutions to reconsider their curriculums, formats, and basic characteristics.

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It is really hard to identify when ethics –or the lack thereof –became a social issue of the magnitude that it seems to be now.  When I received my MBA from Tulane in 1978, a course in ethics was required for everyone in the last semester of the two year program.  It was considered the capstone course of the MBA program and our professor utilized the case study format.  Later, when I passed the CPA exam, I had to take an ethics exam in order to obtain my license in the state of Maryland.  In the early years of my career, I remember the Ivan Boesky scandal on Wall Street in the 1980’s.  Boesky took down Mike Milken of Drexel Burnham and a few others.  Of course, most recently, we have seen the fallout from Enron, Bernard Madoff, and others.  But ethical lapses are not limited to businessmen.  Almost all of us can name a few politicians who strayed from the norm like Congressman Dan Rostenkowski, Governor Rod Blagojevich, President Richard Nixon, etc.  We can also name a few government employees who earned notoriety by selling their country’s secrets including Aldrich Ames and Jonathan Pollard.   Baseball fans might think about gamblers like Shoeless Joe Jackson and Pete Rose or steroid users like Jose Canseco, Rafael Palmeiro, and Manny Ramirez.

I don’t know if the omnipresent nature of the media has drawn more attention to ethical lapses of our political, corporate, governmental, and sports figures or if the frequency has, as I suspect, increased.  However, a recent article in the New York Times spurred me to write this piece.  Written by Leslie Wayne, the article mentions that nearly 20 percent of this year’s graduating MBA class at the Harvard Business School have signed a voluntary student oath that pledges to “serve the greater good” and to “act responsibly and ethically.”  MBA programs have not stopped teaching ethics.  In fact, Harvard, Wharton, and Columbia have several ethics classes and Wharton and Columbia have ethics centers.  I think it is good that these students created this pledge.   However, ethics is not just business ethics.  Ethics is ethics.   Good ethics is good for business.  Good ethics should be good for all of our leaders and followers, no matter what their chosen field.

Ed Strong was one of my grad school professors at Tulane.  On one of my early postings on this blog, I mentioned his name with a list of professors who I found notable for their teaching abilities when I was in college.  Ed found that posting and sent me a note.  We have remained in touch off and on through email and Facebook.  A few months ago, Ed sent me a link to one of the postings on his blog, Cabbages and Kings, and stated that I was one of his few Facebook friends who might be interested in the post.

I clicked on the link and found an interesting post where Dr. Strong shares his teaching philosophy.  He originally wrote the piece for his application for a tenure-track position at the university where he works as a full-time visiting professor.  You can read his post yourself or my synopsis below.  Either way, I think it is worth sharing.

Dr. Strong has a unique and varied teaching background.  His first teaching opportunities were with the Army where the teaching philosophy focused on the notion that only three teaching points could be absorbed and retained by students in an hour-long class.  From the Army, Dr. Strong went to INSEAD in Fontainebleau, France which uses a teaching style similar to that found at the Harvard Business School:  individual instructors are required to undertake extensive preparation, often in conjunction with other professors teaching the same or similar classes.  His time at Tulane, as he explains, brought a very different teaching experience.  Dr. Strong writes, “…I spent 34 years at Tulane, a school whose culture held that the instructor was – once the classroom doors were closed – answerable to no one for what went on in the classroom.”  From these experiences, Dr. Strong’s teaching philosophy has settled into a somewhat eclectic and, by his own admission, ever-evolving one.

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