The headline of a Jan. 8, 2021 Hechinger Report article caught my eye: “More colleges and universities outsource services to for-profit companies.” The story notes that U.S. universities and colleges (which have for many years outsourced auxiliary services such as bookstores, dining and custodial services) are now paying $4 billion a year to some 200 private companies offering online program management (OPM) services.
That outlay is expected to increase to $10 billion by 2025, according to the education market-research firm HolonIQ. And the firm estimates that 300 new partnerships will emerge in 2021 alone.
Well, of course. The past few years have brought a cautious shift toward online learning in a sector that has thrived with an effective business model for many years. That model is now feeling the pressures of economic, social, and cultural change, capped by the sudden disruption of a worldwide health crisis. As one observer noted in the Hechinger Report, institutions seem to be trapped by inertia, and are now being forced into playing catch-up. Why not outsource?
At my institution, the Gies College of Business at the University of Illinois at Urbana-Champaign, we made the deliberate decision not to outsource production, development, and synchronous delivery of our courses. Today, as Gies celebrates the fifth anniversary of the launch of its online iMBA program, there are ample indicators of the benefits of in-house investment and development of online learning.
A PIONEERING JOURNEY
In 2014, as we began two years of planning to develop and take to market a new model for graduate business education, we wanted first and foremost to ensure the high degree of educational quality that characterizes our traditional in-class residential programs. We were (and are) convinced that leveraging the intellectual capital and ambition of our faculty, in partnership with a creative and motivated instructional design staff, would be the best way to align with–and strengthen–our mission and our brand.
Another consideration was the cost of outsourcing; many of the private OPM services are typically costly, and structured on multi-year fee- or subscription-based pricing. We determined that scenario would keep us from investing in our own faculty and staff, and constrain our ability to pivot in what has proven to be a dynamic and fast-moving venture. Our investment was substantial, but it also was internal and transparent, creating the discussion and the buy-in needed to arrive at solutions as a team.
Perhaps most importantly, we wanted transparency for our students, assurance that they would be receiving a carefully curated educational experience developed and delivered by full-time, tenured University of Illinois faculty and professional staff. Related, it was important to understand our students’ distinctive needs for convenience, and to strike a deliberate balance of synchronous and asynchronous learning. Our partnership with Coursera, for instance, expanded our capacity to deliver foundational asynchronous content to a global student body from 100 different countries. Complementary synchronous courses expand the learning through live sessions across different time zones, with sophisticated proprietary technology that allows us to bring a level of personalization to classes that can number in the hundreds.
And finally, we were to provide all of our stakeholders the assurance that our foundational mission as a leading land grant university intent on creating access and equity for all was being achieved with this new model.
A NEW MODEL, BUILT TO SCALE
Well before launching the program in 2016, we made a significant investment in instructional design, essentially transforming the classroom experience to optimize the online experience, and adjusting the pedagogical methods of the faculty. We converted physical space to create video studios and gathered a team of specialists in media communications, graphic design, video, and instructional design to help our faculty re-imagine their roles in blended synchronous and asynchronous environments. Faculty and staff thus became integrated partners in the enterprise.
Perhaps most significantly, we offered the entire MBA for just $22,000, confident that our model would prove sustainable as we scaled enrollment. As our Dean, Jeffrey Brown has said: “The whole program is about breaking down barriers.”
That risk – and a strong marketing effort through stackable credits on the Coursera platform was rewarded by strong growth in applications and enrollments.
Last fall, we realized a 77% year-over-year increase in applications to our iMBA program with nearly 3,300 applications (along with a 53% increase in applicants to our online Master’s in Accountancy program). That momentum continued when we launched a new online Master’s in Management (iMSM) this fall and received more than 550 applications for the first cohort. Perhaps more encouraging, the quality of these applicants, as measured by years of work experience, number of students working with Fortune 500 companies, and the variety of valuable real-world experiences they bring to the classroom, is on an upward trajectory.
There are now more than 1,500 graduates of our iMBA, more than half of whom have reported receiving a promotion during their time in the program. Gratifying to the faculty and staff is that 98.6% of the most recent class reported being “highly” or “very satisfied” with their experience.
THE CHALLENGES OF THE NEXT ERA
The late Clayton Christensen’s theories on disruption predict that we will face increasing competition in the online learning space, new disruptors that will require us to sustain our culture of innovation if we want to maintain our leadership role. We are committed to sharing what we have learned with other institutions, an “all boats rise with the tide” approach that we think is appropriate to our mission.
Nonetheless, we will need to continue to innovate in this space. We have the advantages of being among the first public universities to develop scalable, successful and sustainable online graduate programs. Our success has created a palpable internal climate characterized by a pervasive spirit of pride, enthusiasm, creativity, and optimism that is a natural byproduct of being part of something new, important, and pathbreaking. We will need to ensure that spirit grows as we move forward.
On a more immediate level, we also will need to continuing grappling with the knotty issues of grading at scale. Artificial intelligence applications have proven useful for grading quantitative work in classes with hundreds of people, and we have begun to explore AI systems for qualitative assessment. For now, we are hiring degreed academics to serve as part-time graders, and establishing standards to strengthen consistency.
We look to these challenges with confidence born of our success, and with determination to shun complacency. That’s part of our DNA now. We do this because we believe America’s diverse higher education sector remains an engine for innovation and discovery, a force for economic and social progress, and a beacon to the world. It has proven resilient in the past; it will evolve again in response to the needs of the times. Our first five years have been an exhilarating journey, and we hope our example as pathfinders will inspire others.
W. Brooke Elliott is is an associate dean and EY Professor in the Gies College of Business at the University of Illinois. She most recently served as head of accountancy, and prior to that, as the academic director of undergraduate programs for Gies. Brooke holds a BS in accounting and an MBA with an accounting focus from the Indiana University Kelley School of Business. She earned her Ph.D. in accounting from the University of Washington and joined the University of Illinois at Urbana-Champaign as a faculty member in 2003.
DON’T MISS INSIDE ILLINOIS GIES’ LATEST DISRUPTION