Faculty Members Must Play Their Part in Keeping Teaching Costs Under Control

May 01, 2016

Adam Niklewicz for The Chronicle
Coping with the rising cost of college is getting harder as tuition increases, debt loads accumulate, and state and federal budgets become more stringent. Proposals for containing costs, by President Obama and others, founder in a haze of complexity and conflicting interests. So each year, institutions and students simply hunker down and cover the bills as best they can.

Most cost-containment proposals focus on factors external to the university, but the real problem lies inside: with higher education’s own narrative about the drivers of teaching costs and what can be done to mitigate them. Face-to-face teaching is the defining feature of most campuses, and most colleges spend more on it than anything else. Hence the cost of teaching cannot be ignored.

The traditional narrative about classroom-teaching cost consists of three interconnected elements, all of which have become seriously outdated.

1. Teaching costs can’t be controlled — at least if one wants to avoid degradation of quality. Good teaching is labor-intensive. Teaching more students or producing better learning requires proportional increases in funding.

2. Teaching costs can’t be known with any real precision — unless, as will never happen, professors are forced to punch time clocks. The overall cost of teaching can be estimated, as by the Delta Project, but getting useful data about individual courses, degrees, and teaching modes is viewed as impossible. This reinforces the first problem because, as the saying goes, "If you can’t measure something, you can’t improve it."

3. Teaching cost is an administrative matter, not an academic one; money is the province of business officers, not professors. Faculty members are concerned about what to teach and how to teach well, but they are not expected to find cost-saving innovations, if such innovations are even possible.

Assertions like those, which condition how one thinks about an issue and describes it to others, are powerful because they reflect an organization’s culture and represent it to stakeholders.

The traditional teaching-cost narrative was not seriously challenged before the growth of student debt and the emergence of disruptive innovators like online and for-profit providers. Now that narrative is insufficient, if not dangerous.

The problem starts with measurement — which has been the focus of my research for the past decade.

Improvements in information technology have enabled the use of student-registration data and campuswide course scheduling to create models that estimate the costs, revenues, and margins directly associated with teaching, and then add allocations for overhead to produce figures that can inform tuition setting and state budgeting.

The results can be extended up to the level of degree programs or down to student segments based on demographics, preparation, and the like. They satisfy, for the first time, the growing internal and external demand for transparency on teaching cost.

But there’s more. New models describe teaching in structural terms. They provide detailed historical data on each important teaching mode for every course in the curriculum.

The new models report the numbers and types of students enrolled, the resources used to teach them, and the cost of each resource — and, as a bonus, the revenues earned and the margins generated. They describe how the course is organized: for example, as a lecture with breakouts, a lecture/discussion, laboratory, seminar, or case analysis, and what if any online elements it includes. They can connect the costs to quality-related variables like class size, instructor type, the percentage of students who pass the course, and learning metrics.

Structural modeling allows academic departments to examine the characteristics and costs of different teaching methods, to shape their portfolios of course offerings and instructor types, and to identify courses for redesign. Over time, the models will spur faculty members and administrators to develop better learning measures and then hone their own intuition about the cost-effectiveness of alternative approaches. In other words, universities will come to learn that, contrary to the traditional narrative, teaching costs can be managed without gutting quality.

Consider what happens when course-related decisions are made on the basis of financial factors alone, without reference to information about teaching activities. Looking at cost, revenue, and margin in isolation risks triggering a "race to the bottom" driven by cost per credit hour and other metrics that don’t take class size, adjunct usage, and other quality-related variables into account. Professors are right to fear bad outcomes when administrators set budgets without regard to such variables. Perhaps worse, no one can identify opportunities for cost savings when they do become available — savings that could be reinvested elsewhere or passed along to students. Those shortfalls do not stem from indifference; decision makers simply don’t have the facts.

The traditional narrative’s view of the faculty’s role raises another barrier to cost containment. It separates responsibility for learning effectiveness from the responsibility for cost, the former residing with the faculty and the latter with the administration. Professors are content experts. They push for smaller and more specialized classes, more and better technology, and lower teaching loads that increase the time available for preparation and working with students — and for the research and scholarship they believe are necessary for achieving excellence.

Cost is seen as someone else’s problem, but the "someone else" is an administration that’s too removed from classroom activity to understand the needed trade-offs. Administrators are neither capable nor empowered to make judgments about the fine structure of teaching processes, yet the professoriate has neither the incentive nor the knowledge and training to consider cost in their decision-making.

No other major enterprise faces similar problems. Even medicine has succeeded in making doctors more sensitive to the cost of what they do. Some people seem to believe that the demand side of the educational marketplace creates an invisible hand that forces colleges to make good trade-offs between cost and quality. However, the dearth of educational-performance metrics, the lack of comparable data on net tuition rates, and the existence of public subsidies have prevented the market from functioning effectively. Hence, solutions to the cost problem must be driven from the supply side, from inside colleges, rather than by competitive forces.

This hasn’t been happening, and so stasis on the cost question has continued, along with rear-guard actions to protect colleges and faculty members from criticism and funding cuts. Now, however, institutions are exploiting advances in IT and analytical modeling to engage the professoriate in serious discussions of teaching cost in relation to quality. This will benefit students and give early adopters an advantage. In time, it will allow the traditional narrative about teaching cost to be brought up to date.


William F. Massy, a professor emeritus and former vice president for business and finance at Stanford University, is the author of Reengineering the University (Johns Hopkins University Press, 2016).

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