5 Trends Transforming the Higher Education Business Model
Dec. 11, 2012 at 09:39 AM | By Todd Bloom, Ph.D. | Comment Count
One of the most talked about issues during the 2012 Presidential Election was education, each candidate with his own policies for how to overhaul our current education system. While election season has come and gone, the debate over how to vastly improve both the productivity and efficiency of the U.S. education systems rages on as a key to improving the future success of the nation.
With commonly cited performance benchmarks such as the U.S. lagging behind others in higher education attainment, the higher education community has come under both increased scrutiny and pressure to change their model of delivery, performance measurement, assessment, etc.
With the proliferation of innovative ideas and technologies like Massive Open Online Classes and big data, there is no question, 2012 was a big year for the higher education industry. But what of 2013, what can we as students, parents, educators, and policy makers expect in the year ahead? 
5 Trends Transforming the Higher Education Business Model
College affordability/unaffordability
From 1982 – 2007 the average price of college has increased over 430%, whereas median family income has increased only 150% (National Center for Public Policy in Higher Education). What this means for students and their families is they will continue to bear greater economic burden as state funding for higher education fails to keep pace with rising costs and enrollment. What this means on an institutional level: heightened dropout rates, increased reliance on student grants, pressure to cut nonessential programs and services.
Students as consumers
Students are increasingly educated shoppers, interested in the student return on their investment (SROI) – how will this degree serve me (e.g. income, job, future relevance)? Instead of applying to their top one or two choices, the average incoming freshmen class now applies to three or more schools. In fact, 25% of freshmen who enrolled in college in fall 2010 applied to seven or more schools. An informed shopper is one who asks tougher questions and compares products more rigorously.
Time in college does not result in college success or graduation.
According to Complete College America research (Time is the Enemy report), part-timers are, at best, half as successful (e.g. earn a credential) than their full-time counter-parts regardless of credential type. Institutions must change their paradigm of enrollment and retention to success/graduation. More credit hours per semester is a good thing and fewer unnecessary credits is a good thing – encourage these practices and demonstrate the savings to students.
A competitive landscape – intra-state, inter-state, internationally, and virtual (rise of MOOCs).
- MOOCs have proliferated. For example, this fall semester Harvard and MIT’s edX boasted 100,000 registrants for two courses alone. Registration does not easily translate to completion. The question is: where does this emerging trend fit into the higher education landscape? We’re beginning to see an answer in new institutions recognizing MOOCs by awarding credit. And we’re even seeing employers assign value to MOOC completion in the hiring process – if you can pass a computer science MOOC from MIT, we’ll give you a try at our company. . .
- International student enrollment in the U.S. increased by 5% in the 2010 to 2011 academic year (Open Doors report by the Institute of International Education). At the same time, the Obama administration has pushed to simplify student visa programs and provide incentives to international students graduating with STEM degrees when they choose to work in the U.S. after graduation.
Non-traditional Takeover
The “non-traditional” student has quickly become the norm but recruiting and supporting them is far different than doing the same for traditional students. Recent reports estimate (USDOE) only 25% of college students attend full-time; attend residential colleges; and have most of their bills provided for by their parents. The reality is that 75% of today’s students are juggling some combination of family, job, and school while commuting to class. What does this customer value? If you see the non-traditional student as a growing population in your school, take heed and review your course schedules, housing, student support services, and extracurricular programs with an eye for what is conducive to this type of student.
Todd Bloom, Ph.D. is chief academic officer at Hobsons. Connect with Todd on Linkedin.
blog comments powered by Disqus