Gary Keisling, chairman of Professional Career Development Institute and Ashworth University, is a veteran of the for-profit postsecondary education provider sector. At a recent investment conference, he spoke about new business models in the for-profit education industry. His remarks are reported in some depth in Signal Hill's Education Signals. What I found interesting about Signal Hill's analysis of Keisling's remarks is its relevance to nonprofit higher education in the emerging Web 2.0 era in which competition between nonprofit and for-profit education is likely to intensify. Consider, for example, this interpretation from Signal Hill of Keisling's projections for for-profit postsecondary education:
"The current system in which the cost of postsecondary education rises rapidly ahead of the pace of inflation, leaving new graduates tens of thousands of dollars in debt will finally collapse on itself and turn the current concept of brand embodied by a paper (?!) diploma, on its head. The generation that grew up with Web 2.0 and MySpace as the norm, will reward models that focus on results-based learning and job attainment over a brand on a diploma. The new model will allow flexibility in curriculum design, and even a menu-based curriculum that will offer more choice in course selection. Costs will be radically lower with revenue and profit generated far more through add-on services and third-party relationships. ... Low cost programs will free schools from outmoded regulatory burdens and new arbiters of quality and value will emerge to replace the old systems. One example could be instruction in multiple languages, multiple states, and even multiple countries all currently tightly controlled. Finally Internet socialization will be facilitated and encouraged by the school and online and on-ground content will be completely equal and completely blended at the students’ discretion. These ideas form the basis for Mr. Keisling’s “Sizzling University.”
That projection reiterates what I've been preaching in this blog: per-student operating costs matter and will have to be managed throughout higher education in order to increase productivity while also measurably improving quality -- and accounting for both to the satisfaction of the student and the tax payer.