Tuesday, April 10, 2012

Higher Education and Consumer Demand

Higher Education is facing a challenge that will require it to re-think its essential value proposition.  For generations, we have provided the degrees—think tickets—that were required for entry into the white collar, professional world.    Additional steps (degrees) were often required as well.  No one asked us how we decided what the content of those degrees should be.  We were a third party provider of credentials, and we were trusted to know how to produce effective workers.

So what has changed?  The first development was the shift from college being necessary for some of our workforce to it being the avowed goal for most of our workforce.  I won’t argue about whether this is a reasonable goal, just that it is the de facto goal for most high schools.  That shift meant we are no longer educating students who are already equipped with both learning skills and motivation.  Now we were/are being asked to educate students who may be underprepared for college and not motivated for its rigors. 

The second development followed that increase in scope.  Educating a dramatically wider population is shifting our focus from how higher education traditionally measured itself—faculty credentials, books in the library, research grants, etc.—to how prepared our graduates are for the 21st century workforce.  To understand how profound this shift is I must turn to an example. 

Those of you who are my age (baby boomers) remember what it was like to shop for something before the Internet.  We had to trust sales people.  There was very little comparative information (except for Consumer Reports).  Pricing was a mystery.  Compare that experience to now.  You can enter your desired product into a search field and immediately find websites that offer the product, compare it to its peers, and offer prices for both new and used versions.  The buyer now has all the power.  When I was young, it was the seller who had the power, although those sellers had huge problems introducing their products to the public.

Another huge change is the ability for consumers to drive product demand and offerings.  Via the Internet, consumers now freely post reviews, like/dislikes, suggestions and requests for new products and services.

When I went to school, institutional reputation was determined by how exclusive a college was.  The fewer students it accepted from its applicant pool, the better it was.  Now, Internet resources permit consumers to ask much deeper questions about institutions, to compare them across more dimensions, to see what students think about their faculty, and finally, to compare prices.  These emerging capabilities, when viewed through the larger educational mission of higher education, spell change.  Our customers are now able to ask deep questions about our results.  How many students do we graduate?  What sorts of jobs do they get?  How much do they earn?  Can they repay their student loans? Will you offer an online master's degree?  Can I earn a credential in logistics, energy or education?

These questions signal a shift in power from the sellers—higher education institutions—to the buyers—students.  We saw this happen in every major industry as technology forced established companies to re-invent themselves (e.g. IBM, American Express, McDonald's) or be replaced (Kodak). 

In my next posting I will talk about some of the concrete actions higher education and Charter Oak are taking to adapt to this shift.  To help me address those actions, please share with me the most important factors to you when decided what college to attend. What questions did you ask?


  1. The three most important factors for me were (1) the school being credible, (2) to minimize time to completion, and (3) to minimize expense. Charter Oak obviously met the first requirement easily, and by letting me make full use of transfer credit and CLEP tests satisfied the other two as well.

  2. More than anything, I needed flexibility. With a demanding job and a family, I had to be able to work at my own pace and on my own schedule. Affordability and quality were also important. Charter Oak had all that, and allowed me to earn a degree that I'm proud of.

  3. Thanks Steven and Jeanne. Keep these comments coming as we are collecting them to share with the staff.

    We are committed to remaining Adult friendly, low cost, and high quality. Your stories help us understand how well we are doing meeting those goals.


  4. I feel there is a disconnect at your institution between what is being marketed to students and what is actually being taught. Why did I sign up to attend a class where I read a few chapters from an $80 text book and have some person review my thoughts on a chapter with no real additional insight? I expected some sort of guidance, insight and ideas to be provided. I craved a platform to truly share ideas and collaborate. All I got was a schedule of when to review chapters and how many questions I should answer at the end of it.

    Higher education has become less essential because for some degrees or jobs it makes no difference. If your business department doesn't have any great insights into business how am I not better served reading expert opinions and guides for free online, engaging in discussions on forums and taking the cost of attending your university and investing into my own business?

    I'm young and highly motivated to learn but Charter Oak was a massive let down in my eyes. I went as far as trying to get my money back because I just did not see myself using what I was 'learning'. Before I started attending the online classes I wanted a degree and two weeks into the program I knew it was worthless.

    1. Thanks for sharing your experience. Your argument is actually more common that you might suspect. For adult students, relevance is at least as important as the credential. In other words, since our adult students are already in the job market, they demand that each course be relevant to improving their personal work efficacy. We believe that taken as a whole, our program does improve workplace skills, but you have made a case that the one experience you had did not.

      Thanks for keeping us focused on improving each of our courses until all of them pass the test you have articulated.