How to Judge For-Profits

Growth in the for-profit sector is a hot issue on the higher education conference circuit. Fall enrollment in degree-granting for-profit institutions has risen nearly threefold – from 304,000 in 1996 to 880,000 in 2004 — according to figures from the National Center for Education Statistics.

Accreditors and some of the for-profit institutions they accredit discussed the implications of this growth Friday at the summer workshop of the Council for Higher Education Accreditation. Speakers said that as for-profits gain in popularity and as the sector continues to mature, it’s important for institutions to more vigorously report data on job placement, and graduation and retention rates. The information will allow colleges to see how they measure up with each other, and help remove some of the secrecy that still surrounds the sector, panelists agreed.

Richard Garrett, a senior research analyst for Eduventures, a consulting firm that works with both nonprofit and for-profit institutions, opened the session with a plea: When analyzing the for-profit sector, keep diversity of institution and program mission in mind. “It’s a mistake to regard the for-profits in a monolithic, simplistic way,” he said. “That won’t set a good dialogue.”

Garrett, speaking to an audience with varied experience working with or for for-profits, explained some of the variety — colleges with a focus on online, international and adult learning, and even those that team up with nonprofits to offer programs. He said there has been a movement in the industry toward consolidation of ownership and a shift toward companies becoming publicly traded.

Gregory O’Brien, president of the for-profit Argosy University, said that because for-profits remain bottom-line oriented and are tied to stock prices, they can’t tolerate “bad outcomes.”

Steven D. Crow, executive director of executive director of the Higher Learning Commission of the North Central Association of Colleges and Schools, said these colleges’ ability to act quickly and make structural changes is a trademark, and can sometimes lead to suspicion within academe, which, as a whole, is used to slow change, he said.

Garrett pointed out that while New York state is clamping down on for-profits, and even thought three other states — Delaware, Montana and Rhode Island — are still devoid of for-profit institutions of higher education, these institutions are largely accepted as being part of the mainstream.

Paula Peinovich, president of Walden University, a for-profit institution that focuses on offering professional graduate programs to mid-career adults, said that as state funding for higher education decreases, public institutions are often thinking more like for-profits by making decisions based on the bottom line. “The sectors are more alike than different,” she said. “The source of funding is less important than the mission.”

Accreditation is an area in which some similarities and differences are evident. The largest for-profit providers have sought and gained regional accreditation, and are assessed in roughly the same way as their nonprofit counterparts are, Garrett said. The individual programs are a different story: Many are still grappling with the question of how, and sometimes if, they want to be measured by specialized accreditors.

Garrett said that many for-profits are pushing for standardization of curriculum across institutions so that it becomes easier to size up comparable programs — say, veterinary technology distance learning programs offered by two separate colleges. O’Brien said it is important to have continuity within a college, as well. “At Argosy, we have to make sure that the learning outcomes in Seattle and Atlanta are equal,” he said, adding that there is a fine line between “healthy” standardization and a system that stifles faculty innovation and classroom creativity.

Panelists agreed that more information about pedagogy and student outcomes is beneficial to all. Garrett said the Integrated Postsecondary Education Data System, the current national reporting mechanism, provides colleges with “limited data,” and that institutions “disclose what they want to disclose.”

“There’s no evidence of widespread satisfaction or dissatisfaction at the University of Phoenix,” he said. “No one has good information on how [for-profits] are serving their students. No one knows what the benchmarks are.”

Garrett and O’Brien both said that it’s a matter of one institution taking the lead by releasing pertinent data, and then others will follow. “Now that we are in a much more competitive environment, it’s time to take a serious look at ourselves,” O’Brien said.

— Elia Powers

Comments

States Are Not Immune

Greetings,With this article, Elia Powers is working to keep a very important challenge to higher education on our radars.

Even though a state might not have an in-house for-profit academic institution, they are not immune. The for-profit giants are everywhere. The newest on the block is Whitney International University System, a large, well-financed and organized institution with the world as its campus.

This competition can be good, spurring traditional institutions to take a harder look at reaccreditation and assessment. However, it will certainly drive them to operate more like corporations, an issue that is already receiving a great deal of attention.

Sincerely,Art Huseonica

Art Huseonica, Associate Professor at UMUC, at 6:40 am EDT on July 10, 2006

For Profit Education vs. Non For Profit

First, I am a Graduate of two For Profit Colleges...one accredited and one not, American Intercontinental University Online and Canyon College. Also my wife has a Masters Degree in Education plus a teaching certification from the University of Phoenix Online

I grew up as a fan of alternative education being a minority based in the inner city...my high school diploma was from an alternative school. Most non for-profit main stream schools on all levels are very slow to change, don’t have the students best interest as a priority and are very much out of touch with the more modern concepts of non-linear learning based on internet concepts(distance learning). Change...it seems... is forever and we must except it; For Profit Institutions don’t come free of issues however and are run like businesses but they do change better than traditional brick and mortar schools and offer an even better real world education....they are very competitive due to money being the bottom line.....they boot you out quicker when policy is violated and offer no special help....next inline please if you will. Moreover, non for profit are becoming more like for profit and accreditation for both is becoming very controversial...Meaning traditional schools can maintain theirs and newer schools can’t get them or the accrediting bodies quicker to take away theirs. The more traditional schools have become too traditional and in my opinion intimidated by the non traditional approach. However most of main stream America is run by the traditional graduate and even teaching at these alternative schools and change is resisted by the general status quo…….your better minds are coming from the neediest and necessity is the mother of invention. America must change and education via for profits is a good thing and even those controversial non accredited universities offer excellent educations and the blue bloods of America better watch because you can not continue to keep people down without holding oneself back.

Greg Harris, at 10:05 am EDT on July 10, 2006

While for-profits have exploded in growth tapping adult students, they have not been able to win over the traditional 18-22 year old crowd. If and when they are able to do that traditional universities should be worried. I do not forsee that happening in the near future because of the infastructure needed to support traditional students (ie dorms, athletic facilities, and student unions). Also offering curriculum that does not require expensive labs is another part of the for-profits success.

While it is good to see traditional universities being more fiscally minded, I hope the day never comes when they have the mindset of many for-profit institutions that offers bare bones services and facilities.

Jeff, at 10:35 am EDT on July 10, 2006

Curriculum Standards?

From my newsletter, OLDaily, at http://www.downes.ca/cgi-bin/page.cgi?post=34951

Interesting. “Many for-profits are pushing for standardization of curriculum across institutions so that it becomes easier to size up comparable programs.” One wonders how a Harvard or a Cambridge will adjust its curriculum so it can be compared with, say, Argosy University. Sounds impossible? It is not beyond the pale to imagine the day when the private sector institutions have the clout to push educational standards in the same way they have already pushed things like educational metadata standards.

Stephen Downes, at 10:35 am EDT on July 10, 2006

Bad Outcomes

Since they are apparently considered threats to profit margins, to what “bad outcomes” is Gregory O’Brien referring?

Advisor Ian, at 10:50 am EDT on July 10, 2006