Whether it is implementing performance indicators or fancy new dorms meant to appeal to students, our Universities and the PASSHE system (echoing the culture) seem enamored with business models.  Are business models appropriate for public higher education?  One would think that the recent fiascos surrounding for-profit higher education would be enough for anyone to see the how a business mentality undermines the credibility of higher education.  But, alas, it seems that few leaders in higher education are able to connect the self-evident dots.

Even setting aside the very real failures of for-profit colleges and universities, the notion of using business models in higher education does not make sense.  For example, even the most basic business model must start with the assumption that a business has customers.  Who are the customers in public higher education?  The only answer that even facially makes sense, the one that is thrust on us all, is that the students are our customers.  For numerous reasons, I believe that comparing our students to customers is simply ridiculous.  For example, our Universities do not just work for students; we have responsibilities to the Commonwealth, the Federal Government, our disciplines, and academia generally.   I have never heard any serious business model that seems to take this into account.  Instead, what we wind up with is a confusing array of performance indicators that seem to pull the Universities in different directions without any guiding principles.

Further, even if our students are customers, they may be the least rational.  A former professor of mine at Penn State used to have a sign on his office door that read, “Students are the only consumers who want less for their money.”  The idea that student wants should be the determining factor in what a University offers to students simply flies in the face of some of the basic academic goals of a University.  It presumes a knowledge base among students that just does not exist.  Do students really know what they want?

Putting these points aside for right now, however, one of the most damning arguments against business models in public higher education is that the very people who push for them do not take them seriously themselves; for If public higher education were truly a business, the most basic element of the market ought to apply.  Can there be a simpler concept than supply and demand?   Yet, as the demand for public higher education in the Commonwealth continues to rise (ever increasing enrollments) and supply remains constant or grows only slightly (seats available), does price (tuition) go up accordingly?  Yes, tuition has risen, but has it been allowed to rise by those pushing business models to its market level?  Clearly, no.  In fact, the Board of Governors has openly kept tuition low, even at the cost of impacting the Universities’ ability to provide a full education.  It just does not make sense.

Of course, tuition should not rise to its market value.  Higher Education is a public good, and the Commonwealth should be supporting it at appropriate levels.  The main point is that those who push for business models cannot possibly even truly believe in them.  The bottom line is that business models just do not fit public higher education.