This post is for my independent school readers. “We don’t want to make tough choices” is not a strategy for long-term success.
I am way behind on some of my reading, so apologize that I am just now getting to the NAIS February article by Kevin Weatherill, Will Hester, and William Daughtrey in which the authors report on their survey of cost-cutting and revenue-boosting options for tuition-charging schools. The authors surveyed over 900 school heads and CFO’s, and the big takeaways were these: schools don’t have any magic beans to grow new revenue sources and the vast majority of these leaders don’t want to cut costs.
That is a slight overstatement, but not much. And, to be brutally honest, the article is merely a strong re-affirmation of what we have known for at least the last two decades.
The vast majority of schools do not have a significant source of non-tuition revenue. In the mid-2000’s I did a study of over 50 of the largest, most financially strong independent schools in the country, and found only one or two had found this magic bean; both were able to rent out a unique facility for some extra income. Since then, the radical differentiation of the education market has, if anything, made it harder for schools to charge for ancillary programs that may be offered somewhere else in the community for less, or for free.
The real disappointment brought to the fore in this study is on the cost side of the equation. We have known for decades that significant re-balancing of the cost/value proposition of tuition-charging schools is wrapped around our biggest expense: people. We have to pay for salaries and benefits that attract and retain good teachers. So that leaves two ways to reduce costs: reduce the head count of administrators and/or increase the effective student-teacher ratio. It is amazing that this study found that
The vast majority of school leaders reject increases in class sizes or teaching loads. When asked to consider how important a series of measures would be in decreasing costs over the next five years, 80 percent of CFOs noted that “increasing teaching loads” would be “not at all important” or “slightly important.” That number dipped slightly to 74 percent of CFOs when asked how important it would be to “increase[e] class sizes.”
How can CFO’s at independent schools NOT see the critical need to re-think teaching loads and class sizes? What don’t they understand? I can see how the teachers might reject the potential impact, but CFO’s? Unless their school has a very long admissions waiting list, indicating a soft education market, this does not make much sense.
Here is the kicker: there are an increasing number of schools, in an increasing number of communities across the country and around the world, who are finding ways to offer differentiated, individualized, high-quality, relation-rich learning to their students at larger overall student-teacher ratios. They are generating student learning outcomes at least equal to, and in some cases better than, expensive independent schools by re-thinking how learning actually takes place. Their students are going to the same colleges and getting the same jobs…for free. And this trend is accelerating rapidly, so those independent schools that are not threatened by this value competition today may well be pressured tomorrow.
Re-imagining the relationship between student and teacher is the one magic bean that indy schools have. It is NOT shifting the deck chairs on the Titanic; it is re-building the Titanic with a new set of water-tight bulkheads and a better obstacle-avoidance system. It is not simple, but it is one heck of a lot better solution than wishing that icebergs were a myth.
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