Education @ the Crossroads

Will the Disintermediating Influence of Online Learning and Alternatives to Traditional Classroom Instruction Deflate the Value of Classroom Environments? Will this New Era of Rising Educational Costs Polarize Student-Customers in a New Economy of Unlimited Choice?

When I was a kid, I hated taking tests and quizzes. Not because I disliked competition -I've always loved a fight - but it always seemed like contrived competition. I wanted to be pitched against the right opponent. Much like any other, red-blooded, American slacker-youth who had more important things to think about, testing my ability to memorize a textbook older than I was seemed silly. As I tried to "beat the bell-curve" of statistical mediocrity, by doing better than my fellow classmates, I often thought it'd make more sense for us to compete, as a team, with the classroom next door.

As our kids head back to campus, and summertime wanes, I think it's time to ask ourselves a tough question. Is education, as we know it today, obsolete? Some feisty competitors like to think so; so do their financiers. American education, from the college level down through our public schools, faces significant competitive challenges as we burst forth into a new Age of Enlightenment in a New Economy. At both the K-12 and college levels, educators and their institutions are struggling to adapt to these new challenges, as costs skyrocket and perceived value moves in the opposite direction.

At a national level, both of the major Presidential candidates are espousing the value of education and the need to be responsive to students and parents alike in terms of making sure kids learn effectively. But, like companies who choose the wrong business to be in, I think national education policy will be forced to align itself with the marketplace in ways administrators, teachers, students and communities have little experience with or affinity for.

For the past several decades, K-12 education in the form of our public schools has been a de facto protected monopoly - teachers unions and the power of collective bargaining has tried, very democratically, to level the playing field of teacher pay to ensure that each is treated equally based on experience. However, the fundamental mistake in planning with this approach is that the "Invisible Hand" of the market is ignored - even as it exerts its influence apart from teachers and schools.

Growing demand for world-class education by parents, as they've come to understand that "knowledge is power" and that learning means empowerment for their children, has led to a disconnect between perceived demand for education and the actual supply dynamics offered by public schools. Parents aren't sure their kids are getting the education they deserve - heck, they're not even sure their kids are safe. Certainly, today's generation will receive more and better instruction than any before it; yet teacher pay is one of the slowest rising of all professions. What's the big, mystery of our teacher "shortage"?

The fact is, this shortage is an illusion - there are more education majors in today's colleges and universities than ever before - which has led to a substantial overabundance of teachers and a glut that brings down the price they can command in the job market. Indeed, it's difficult for most teachers to find a permanent, career-oriented job in a stable environment with competitive compensation. The reason school districts, and the communities that fund them, have not been willing to raise teacher pay is simple: they haven't had to - in effect, like it or not, teachers have become dime-a-dozen commodities. The exception, and the reason why we talk about a teacher shortage, is that the real demand for teachers lies in the areas of math and science, not in social studies and English. Yet, an obsolete model of teachers' unions has forced compensation rates to remain "equal" and ignored the competition for such skilled workers in other, more lucrative fields. Demand from the private sector for professionals skilled in math and science means that schools, who won't stray from a decidedly "socialist" approach to fair and equal pay, will cause wages stagnation to continue at all levels, when the market could apply its influence and force teacher salaries upward by decreasing the supply in certain fields thereby creating demand. Seems like simple economics, right?

Wrong. Schools, and more specifically, teachers who've been misled by their unions, will fight tooth-and-nail to keep wages keyed to the fantasy of seniority, ignoring notions of obsolescence for certain, more senior fields, instead of accepting, even embracing, the realities of the marketplace. And this will perpetuate our teacher shortage for math and science, as well as the glut in liberal arts, educators. I find it tragically ironic that this reality is so terribly misunderstood - and customers, meanwhile, are finding alternatives.

The disintermediating forces of the Internet are being felt in the form of opportunistic, market-oriented firms that will fill the gap in educational alternatives. State voucher programs have already struck education at the K-12 level -- a revolution in my own home state of Wisconsin -- where parents can get vouchers from the state to pay tuition costs for private school. Privately administered, yet publicly attended, schools are becoming more and more successful. Charter schools are offering alternatives for students with special needs (and ambitions!). More parents that ever are yanking their kids altogether and "home schooling" their children, at least for the first few years of their K-12 careers, so they have better control over the content being taught and the level of educational performance demanded from their children. And, finally, students have embraced the Internet as a way of, not only socializing to expand their own personal networks of educational interface with other students, but for serious study and research apart from the resources offered by an poorly-funded public school system.

Companies are being organized and grown today that will cater to this pent-up demand by consumers for choice and schools are struggling to compete. Colleges and universities, likewise, are feeling the competitive forces of networked educational opportunities - only recently attempting, although fairly successfully, to integrate new learning technologies into their curricula. But, many educators at the post-secondary level lament the shift - one professor I recently spoke with complained he could no longer conduct research in his field during the regular school year, having instead been forced into the routine of weekend Web development and repackaging of content for Internet distribution. This too, in Napster-like fashion, has led to copyright infringement that will only continue to grow, as instruction is disseminated to ever-widening circles of students who can then "share" what they've paid for with their tuition dollars. The revolution has begun. Yet, similar to the music industry's experience with Napster and its kin, colleges continue to raise tuition costs to astronomical levels - college costs continue to spiral upwards at rates faster than we've ever seen before.

So, what lies ahead for schools, educators, students (as customers), their parents (as those who pay the tab) as well as the future of a knowledge-based economy?

As you can probably guess, the knowledge economy won't have too much trouble increasing the supply of skilled workers to fill its cadre of professionals - look at the growth of corporate training programs in all areas of subject-matter to fill the void online and off, becoming a full-blown industry of its own. Organizations in private and public sectors alike have long traditions of training their own people in areas where they need help through HR programs; today we see the fast-growth area in Internet-based education as instructional providers move their products to the Web and beyond.

Similarly, parents will be empowered by the momentum of these shifts as they now have more choices for their children's education. My belief that, the very essence of excellence in most fields is competition - and the very essence of competition is choice. You can't have choice without alternatives and, even if the entrenched teachers unions continue to exert their influence over the route our tax dollars take, the financiers of our children's education will demand access to alternatives and force schools to re-engineer their business models.

You heard me right - schools are in business - the business of education. And, all successful businesses (those that survive and thrive) must continually learn to move with market trends and chase demand - or leave the business. This new era of educational choice means competition for students will become more and more fierce and a shakeout in providers will eventually occur, while probably very slowly. However, like the frog who boils in gradually heated water, when he might jump from the pan already boiling, if schools are to avoid disastrous levels of obsolescence they must respond to these new competitive threats today and with more creativity than we've seen thus far. Attempts to exert their traditional political influence to justify their continued survival will, eventually, fall on deaf ears.

Educators take heart. While parasitic unions will likely fail from true obsolescence, teachers will not. Should teachers choose to discontinue their support, we may yet see the best possible outcome for teachers unions based on new realities in market dynamics. Demand for education has never been higher - and continues to outpace demand growth for most other goods and services. Teachers will always be in demand. But, teachers have to listen to the market to understand which fields of study are "growth-oriented" and which are in a short-term state of decline. Supply-glut fields are crying out for a sifting, assuming that wage rates will break free from unionized, seniority-based pay scales - as old ideas for an old economy. Skill yourself in high-demand areas - math, science, computers - arguably, there will always be a growing market for these, simply because they're difficult to master. Such fields of study might not be as much fun as English, art, music, history and the like, this is where the market is headed - and is most likely to lie in the future. But, don't fear our children will lack instruction in liberal arts areas - in fact, as more teachers choose the high-tech track, the supply glut of these teachers will ease and an Evolutionary marketplace will pick its winners. But, be ready -- those that survive will probably have to work during the summertime, as many of you do already.

School -- re-engineer thyself! Schools must figure out their role in a future where "Anytime, Anyplace Learning" is the norm, rather than the exception. Many schools are already shifting resources toward this new reality in the form of community education initiatives - often in "coopetition" partnerships with other educational alternatives. Schools must not, however, depend on the property tax base for their survival. This is probably a scary, perhaps non-sensical, argument for many gentle readers - perhaps because so many of us know (or are) teachers ourselves and love our schools for what they've always been. But the fact that we all know a few teachers and love public education ourselves might be evidence enough of the overabundance of instructional alternatives. When former, science-fiction concepts of virtual reality and artificial intelligence become commonplace in our coming century, the alternatives available today will seem tame by comparison to a virtual teacher that can give one-on-one instruction to every student rather than captaining a classroom packed with too many kids where teachers are just trying to stay in control of constant mayhem.

And what of students? Learners, even today, have so many educational opportunities that it will become increasingly difficult to choose the best, most appropriate "brand" of learning available. The idea of brand awareness will become important - those brands that offer a high price-to-quality ratio (e.g., a good value) will rise to a heightened level of awareness in the minds of students - perhaps even to that of Levis, Nikes and Tommy Hilfiger. And, perhaps most important, is an idea that has changed very little in the centuries since students have sought out teachers in search of knowledge -- students will need to take greater interest in their own educational outcome. They'll need to figure out what they're interested in - often on their own, in the absence of an educational bureaucracy that has always told us what we needed to know and mandated subject-matter to the least-common-denominator.

My critique may be a harsh one, and the chief risk of this new educational marketplace lies in the potentially polarizing effect between students who can afford face-time with a teacher and those forced to settle for online options, which is why choice must be our focal point. The value of personal attention to student needs must not be underestimated. Teachers are both role models and life-mentors to kids - many of today's teachers chose their career because of an influential teacher in their own lives, and I remember fondly the character building I underwent throughout my school years. The principle fear I have about our brave, new world is that kids with financial resources will be the only beneficiaries of this live, face-to-face influence - and those without the same monetary clout will miss out on such opportunities. We mustn't let "choice" between educational opportunities diminish the social opportunities available.

So, while the culturally homogenizing effects of public education will diminish - we'll become a more diverse society - even today, one could argue we are no longer a single society, but many. Students at all levels -- I think, when given the power to take control of their own academic destinies, make choices based on their interests and offered unlimited educational opportunities -- will respond much like any other individualistic organism. They will learn they must seize those opportunities in the ongoing search for knowledge itself.

Arik Johnson is Managing Director of Aurora WDC, a competitive and strategic intelligence consulting and research bureau - contact him through his Web site at www.AuroraWDC.com.