The Future of For Profit Education

  I've spent a lot of time recently studying the for profit higher education field.  For those of you that aren't aware, for profit schools have been under tremendous scrutiny by the government over the last couple of years.  Let me catch you up by linking to THIS article.  Have you read it?  Good.  As a generalization, the problem the for profit education sector has run into is the same problem any business has when they get away from focusing on their customers(students) and their product.  When profit is your number one goal you are doomed to fail because there is no substance to your business to fall back on.

The Late Steve Jobs talked about always putting products over profits.  Not that being profitable isn't important, but that being profitable gave you the ability to make more great products. How many of you are reading this on an Apple product?  I promise that Apple made a nice profit on your purchase.   In the Higher Education field, being profitable gives you the ability to train and graduate lots more students and make their lives better and the country richer.  Our industry needs to focus on our mission, our courses of study and our students success.  That's what will lead to long term profitability, as opposed to shady selling tactics.  To be clear, an admissions advisor focused on "sales" is important.  A great admissions advisor will properly qualify a potential student, and then it is his/her job to "enroll" them in the possiblility of what this educational opportunity will provide.  Any sort of higher education program is a big commitment and students do need help seeing the big picture.  It's not only a schools job to help students with this, it is their obligation to have a great academic program that will then back up what the admissions advisor has promised.  

The advantage of a for profit organization is that nothing gets in the way of innovation and improvement.  Theoretically, the more you improve, the more success your business will have.  Recently, one of my children needed academic intervention which my wife and I felt wasn't as robust as necessary to solve the problem.  We were told by the school system that they are doing what is mandated.  A for profit business doesn't think that way.  It thinks, what do I have to do to get the job done as that is the only way to be profitable and stay in business.

Lastly, the schools that will survive are the schools that are commited to offering programs that are better than their competitors.  These competitors are both for profit and not for profit.  Price isn't as much of an issue when you offer a better product.  That being said, schools need to charge tuition that makes sense for the economic times that we are in.  I'm not talking about a race to the bottom, but tuition that makes financial sense for both the business and the consumer.  I personally believe all the scrutiny of our industry is ultimately good.  The education companies most committed to their student focused missions will not only survive, but ultimately thrive, while the rest of the companies will slowly fade away.  Capitalism at its best.

Rich Goldberg