Running Schools as Businesses?

We often hear “if only we ran our schools like businesses …”  Over at USA Today this morning, they ran a snapshot of data collected as part of Deloitte’s 2008 Education in Business survey of 300 business executives and 300 educators.  The results should be surprising.  Among business executives, 82 percent say the U.S. education system would become more efficient and effective if it ran like a business. Among educators, that number drops to 56 percent (though still a solid majority).

Eduflack has done more than his fair share of focus groups and polling of American industry and knows all too well that corporate executives do not believe that today’s high school graduates are adequately prepared for the jobs that are to become available.  There has long been a disconnect between K-12 and our economic engines, and that shows in surveys like this.
But what exactly does it mean to run our schools like businesses?  Will our school districts be more effective if they are run like the banking, mortgage, or auto manufacturing industries?  Are we looking for a business model like Nordstrom’s, Macy’s, or Target?  Are we offering lessons from Ruth’s Chris or McDonald’s?  Are we learning from all the businesses chronicled in “Good to Great” or just those that haven’t enacted massive layoffs or declared bankruptcy?
The simply answer is that we simply cannot run our public schools like businesses.  Our public schools cannot refuse service to customers (students) they don’t wish to serve.  Our schools don’t invest in the research and development that most industries require.  We can’t choose not to locate our schools in certain communities because of low incomes or low return on investment.  We can’t hire and fire employees at will, nor can we reward those for a job well done or penalize those for one poorly done.  We can’t tap financial reserves or lines of credit when our budgets dry up (unless we are talking about bonds for construction or capital projects).  We can’t compete for customers, with local schools doing whatever it takes to win over parents and students for their business.  We can’t match supply with demand, requiring us to bus some kids great distances to their schools.  And we can’t even ensure return on investment, as schools are focused on inputs and processes, over outcomes and results.
Running schools as businesses is one of those great “straw men” issues that we often through out there as a substitute for talking about reforms or targeted improvement.  There are well run businesses and poorly run businesses.  Same goes for schools.  There are good CEOs and good superintendents.  There are union and non-union workforces in both.  There are competitors (for the schools, they would include charters and private education alternatives).  
At the same time, though, there are few businesses that are committed, let alone required, to serve each and every customer in the region (even those who may be difficult to serve).  There are few businesses that have their products and services closely regulated by the local, state, and federal levels.  There are few businesses that put their resources where they are least needed (like high-performing schools), while keeping their best employees away from the areas that need good help most (like our urban centers).
Can our schools learn from business best practices?  Absolutely.  We can invest more meaningful R&D.  We can provide teachers the ongoing training and professional development needed to adjust to the changes in the profession.  We can adjust our product (instruction) to meet the changes in our community and in our marketplace.  We can focus on ROI, measuring that all students are getting the education products they are promises.  And we can even offer satisfaction guarantees, where students or future employers can seek additional education or training if we find our graduates lack the skills one associates with the degree earned.
At the end of the day, there is no magic bullet for running American businesses and there certainly is no such solution for running our public schools.  Education can learn a lot from business, both good and bad.  But more efficient and effective?  We still don’t have universal agreement on what efficient and effective means in public education.  We can’t agree on how we measure student achievement or whether such performance is the measure of a school or a teacher.  And if our economy is any indication, our confidence in the efficiency and effectiveness of American business seems to be at an all-time low.
School improvement shouldn’t be about adopting a new “business” model or acting more business-like.  Like good businesses, our schools need to solve the problem.  Successful schools understand their customers, have a handle on their resources, know what their problems are, and identify and implement targeted, proven reforms to solve the problem.  Instead of stockholders, they answer to families and the local community.  Instead of stock prices, they measure themselves based on student learning and achievement.  And like any forward-looking profitable business, they are never satisfied with the status quo.

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