The Business of Education

August31

The retail business model does not apply to schools

It would seem to be pretty clear, even to someone who didn’t spend their first career at a Fortune 500 company as I did, that a lot of the reforms in education seem to be based around bringing “business” principals to teaching and learning. These ideas center on things like customer service and market reforms, use of data information, and organizational structure. While I think there are some things that can be learned from best practices in other fields, trying to adopt reform models from business on a “wholesale” basis ignores some basic differences between the function and ecology of public education, and a for-profit business.

Customer service and market reforms

Education is a service, but it’s not a service business. This is a critical distinction for a couple of reasons. Many people have pointed out that public schools must serve all customers that show up at their doors, but unless you have worked in a service business, you really can’t appreciate the myriad ways that “undesirable” customers are not just discouraged, but turned away. When businesses seek to be more customer friendly, they don’t mean all consumers, they are usually attempting to woo, and please a specific type of consumer/potential customer, not just any Joe on the street. You may say, “What business would turn away a potential paying customer?” If they don’t think that customer will be profitable, they don’t want them because they will not survive as a business if they aren’t making money. Businesses do not need to post a “right to refuse service” sign, to discourage custom from certain quarters.
In my prior career as a banking analyst, I was having a hard time fitting in (which is how I ended up in teaching, thank the lord). In an attempt to find a “home” I did an informational interview with the department that was in charge of CRA (Community Reinvestment Act) compliance. This was in the early 1990s. I was living in Oakland at the time, and the lack of bank branches in certain neighborhoods was a hot issue. I brought this up at the interview and asked for a company position. The person I was talking to said that they were welcome to come to branches in other neighborhoods (hmm, what if they don’t have a car), and that in Illinois, people didn’t use branches, but did much of their banking by mail which could be a solution. I suggested that setting up mini-branches or ATMs at the local BART (subway) station might get folks some access, but stated that whatever our opinion, I didn’t think these neighborhoods would see these as viable solutions because they wanted a branch with tellers and loan officers in their neighborhood, not two miles away. When I arrived back at my office, my manager informed me that the person I interviewed with considered my “opinions” radical. I was radical because I spoke the heresy that however we at the bank may have perceived things, our audience in those neighborhoods would have their own opinions and our wishing it otherwise would not make it so.
That error in thinking on that manager’s part had no negative consequences for her, and likely not for the bank. She would be seen as “protecting” the banks assets by not advocating for placing a branch in what was seen as a low-income (therefore low-profit) high-crime (therefore high overhead) area.
That approach of relying on “customers” from less desirable areas come to you, rather than going to them, also plays out in education. This is how schools of choice (magnets, charters, etc.) work. They ignore a fundamental desire of parents in low-income and under-served areas. Just like folks in West Oakland want a bank branch IN their neighborhood, most parents want functioning schools nearby, not a bus or car ride away. When their alternatives are not in their neighborhood, most will not take that alternative. In banking, when faced with no bank branches in their neighborhood, most residents turn to check cashing stores. With grocery shopping, when faced with no super markets, they use local corner stores and liquor markets. This is not great for the neighborhood, but grocery chains, and banks don’t seem to be feeling much pain from this. In education, the effects are not as benign for public school districts. As Diane Ravitch has pointed out, most families in New York City, when “forced” to choose because their neighborhood high school was being converted to a “small learning community” ended up not choosing and were placed in the “next” default comprehensive high school that took over their attendance area, concentrating students with the most needs, and fewest resources further with each successive school closure/conversion.

Next up, customer service and doing the numbers.

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“The Business of Education”

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