Dear class members,
welcome to the preweek to the Management of Distance Education: Cost Analysis course. We are glad to have you here in the economics class. Some of you I know already from other courses, especially the Foundations course ages ago.
This suggests that some of you have delayed the economics course, - from which I may infer that economics is not your favorite topic. Nevertheless, you have to take it since it is a mandatory course. It has been declared mandatory because of its relevance: issues of cost, efficiency and cost-effectiveness are seen to be of high priority for anyone who aims at a management position in distance education. But keep in mind we do not aim at turning you into an accountant but into somebody who can be a competent interlocuter with experts involved into costing or cost-efficiency assessment.
Being by now old hands in WebTycho there is no need for you to use the preweek to learn navigational skills to move about in WebTycho. You may, if you have budgeted some time for the preweek, do other things:
Reading ahead: The core readings are the textbooks of Rumble (1997)
and Bates (2000). Note that we have changed to a more recent book written by
Tony Bates which underlines the shift of focus expressed in the changed title
of this course (cf. Module 5 of the Syllabus).
Furthermore, there are a number of readings provided electronically which you
can access by clicking on Course Content on the Menu.
Kind regards
Thomas
Dear class members,
this course follows to a large extent the set-up of the Foundations of Distance Education course most of you have completed. Its main mode of teaching and learning is text-based. However, in one respect this course is breaking new ground. Besides the usual wordprocessing, we want also to use spreadsheets. The reasons for this are straightforward:
I add the spreadsheet as an attachment.
You may to have to move a bit lower down, in order to see the attachment icon labelled 'Excel test'.
If you click on the icon you should be asked if you want to activate macros or not. You need to opt for activate. The test is merely a self-test which indicating the minimum level of Excel needed in the course. You do not need to to upload the correct answer.
Kind regards
Thomas
Dear class members,
the second thing which you profitably can do is reading ahead. The core readings are the texbooks of Rumble and Bates (for references see Syllabus or Course Content on the class menu). I understand that there are problems of getting sufficient copies of Rumble (1997). Greville's book is not going out of print but of the last edition the copies are sold out before the new edition has reached the market. As I understood, there are about sixty copies available at Kogan Page, UK, but it is not clear how to get hold of them. I am in contact with Gene Rubin and Greville Rumble on that and I am confident that we will find a solution during this week.
Besides the textbnooks, the readings we will discuss first in the introductory weeks of the course are
To find the articles click on Course Content in the sliding menu. There you find Textbooks and Readings and Readings per Module. You may click on either of them to access the indicated readings. Read them attentively and take your notes. We will open a respective main topic as soon as the course officially starts .
Kind regards
Thomas
Dear class,
there is a further thing which would help you to prepare for the module about the global expansion of the educational systems and which allows you at the same time to practice spreadsheet skills. It is the Global Education Database, GDE 2000, produced by USAID on the basis of UNESCO data and made publicly available as a free Internet resource.
It is a very useful professional tool and may convince you of the impressive
power of spreadsheet type of dataprocessing. However, remember that we are in
the preweek. This ia a suggestion how you can profitably prepare for the course
but is not a required activity.
Have fun.
Kind regards
Thomas
Dear all,
click here to find an Excel tutorial. You may also make a websearch with Excel as keyword and you will find many alternatives, including some interactive commercial offerings.
Regards
Thomas
Dear class members,
Nice to have, this time for once, a sizable class. The course is a core course and, hence, to come here not necessarily signals that this is your favorite subject. I hope, nevertheless, that not for all of you economics and costing are such dismal topics, you would prefer to avoid. (And if, I hope, you will find something interesting or at least relevant here.) - Therefore first: a heartfelt welcome to all of you at the official beginning of the Management of Distance Education 1: Cost- Analysis course.
Name change
You may have realized the name change. Originally OMDE 606 was called 'Economics of Distance Education'. The course title was in a sense an exaggeration since economics played a limited role. Mainly we try to understand costs. Partly the flagging student numbers were interpreted by the program management that students associated with economics mathematics. If this is so, the devil's hoof is still showing under cost-analysis.
But while we do not do economics, we also don't do accountancy
either. The aim of the course is intended to make you a competent partner in
any discussion on costing issues of distance education. This emphasizes the
management aspect: While much of the course content remains the same, we have
added a module 'Managing technological change' where, based on Bates' recent
book we discuss aspects relating to management, technology and costs. You may
have noticed that we have changed the second textbook of the course:
Instead of
Bates, A. W. (1995). Technology, open learning and distance education.
London: Routledge.
we read
Bates, A. W. (2000). Managing Technological Change: Strategies for College
and University Leaders. San Francisco: Jossey Bass.
For your orientation
In order to get to know what you have to expect and to better plan your time for this term, just revisit the Syllabus, and especially look at the Schedule included. The syllabus also includes information about the number of assignments and their weight when it comes to grading (cf. also below). Then look at the Readings. Make sure that you get the textbooks and tell me if you have problems in this area (e.g. a document does not open, that print is too small etc.). Please, feel free to point out inconsistencies, preferably by email (to save me some embarrassment ;->). - Further helpful documents are listed in the next main topic.
In terms of conferences four conferences are open now: The Preweek, the Economics Café, Introducing the Course (i.e. where you are now), and Module 1: The Expansion of Emergence of the the Economics of Education. Besides the Economics Café all other conferences will descend on the list when new conferences are opened.
Places to socialize, places to work
The Economics Café is the place to socialize. Many of you know each other already and may in the Café have a chat. Others are new. Please, all make sure that you have posted your bio, but post a Hello in the Café nonetheless.
Course related issues may be content or process related. (A content related problem is 'Is it really true that investing in education spurs the economy?"; a process related question may be 'Why, as a participant, should not post a main topic?') It is suggested to discuss content related issues under the respective conferences (or main topics of the modules), and process related issues in this conference, i.e. Introduction.
The course basically falls into the following parts:
I hope you will enjoy the course.
Kind regards
Thomas
Dear all,
This course is special in, at least, two ways. It is much bigger than usual
(which unfortunately cannot be unambiguously interpreted as being due to its
or my growing reputation but because the course remains core course of the MDE
and is a 'must'), and that I have the privilege to co-teach with two 'visiting
experts': I am happy to introduce Prof. Dr. G. Rumble (UKOU),and Prof.
Dr. A. Bates (Canada/UBC).
 |
Greville, the author of The Costs and Economics
of Open and Distance Learning, one of the core textbook for this course,
is a recognized expert and internationally renowned consultant in the field
of economics of distance education. Greville will be available for one week
(03/17-03/23.) to answer your questions and discuss with you. You find some biographical information on Greville at 'Faculty/Staff Directory' at the MDE website. With Greville Rumble you have the exceptional opportunity to discuss not only with the author of the core text book for this course but with an acknowledged experts in the field of economics of distance education. I am happy to work with him and I am certain that you also appreciate this opportunity. |
 |
Much the same we can say about Tony Bates. He is the author of Managing
Technological Change which we use now as a core textbook. He made
a name by focussing on costing and management aspects of educational technologies.
His visit is scheduled for the 14th week of the course (04/28
- 05/04) to answer your questions arising from his book. |
For all three of us, let me welcome you to this course. I hope that we will create an interesting course with lots of questions, some insights and, may be, even a few practical guidelines.
Kind regards
Thomas
Dear all,
We asked you to look at the grading policies again. You find all the relevant information under Syllabus/ Grading information. One of the perennial questions is if conference contributions are graded and how many assignments are to be written. I put the relevant information together here.
Though it has been (and is still) policy in the Foundations course that conference participation is not contributing to the grade, we decided for the this course to modify this policy and make online participation contributing with 25 % to the final grade. We have some non-graded tasks which, however, depend on active participation. Here the 25% come in.
But there are other reasons to participate in the debate. 'Articulating oneself' (besides 'attending', 'debating' and 'practising') is a central mode of learning. It is the great advantage of asynchronous communication that all participants can 'speak at the same time' without them interfering with each other like in a face to face debate. Articulating, in text-based asynchronous communication involves thinking and writing. It forces you to express your ideas in a written format which is open to inspection and criticism. Though there is a difference between articulating yourself by posting a comment to a conference and writing an assignment, participating in conferences is a good testing ground for your ideas.
If you have further questions, please post them here.
Kind regards
Thomas
Dear all,
you are old hands in WebTycho now and I do not need to repeat to you the navigation functions of WebTycho. However, the following conventions, which I suggest here, are not familiar to all of you. Since they involve some analysis of the navigational tools, you should read this and make up your mind if you want to adopt them.
WebTycho conferences consist of three levels: Main Topics, Responses, and Asides. The Main Topics are generally created by the faculty, the Responses are responses to Main Topics and the Asides are responses to either Responses or Asides.
The three level are clearly
distinguished by type thread number and level of indentation. Main Topics
are preceded by counting numbers. Generally, a conference has little more than
ten Main Topics, seldom more than twenty. Example of a thread number of a Main
Topic: "3 Defining DE".
Since Responses are always responses to Main Topics their thread numbers
carry as first number the number of the respective Main Topic. However, after
a point (no decimal point!) they carry a further number which counts the Responses
of this main topic. Example of a thread number of a Response: "3.14 Re:
Defining DE". This identifies this response as Response No. 14 to Main
Topic 3.
Asides are either responses to Responses or responses to Asides (never
to Main Topics). Assuming the first case: here, the thread number of the Aside
includes the thread number of the Response to which is responding. Example for
the tread number of an Aside: "3.14.7
Bob's comment ". This Aside is the seventh response tom the Response 3.14.
However, here is a little source of confusion since an Aside can be not only
a response to a Response but also a response to an Aside. This means that the
thread number does not clearly identifies the target message. It tells us that
it is the seventh message arrived in thread 3.14. but it might be targeted at
(preceding) Aside like 3.14.4 and not to Response 3.14.
If you read a Response you may answer by pressing the Respond button. If you
do not include your own message header, a header will be generated automatically.
Say you respond to "3.14
Re: Defining DE". Pressing the Respond button you get "3.14.5 Re:
Defining DE". If all do this we will have
"3.14.5 Re: Defining DE"
"3.14.6 Re: Defining DE"
"3.14.7 Re: Defining DE"
"3.14.8 Re: Defining DE" etc.
This is obviously not very informative and does not incite your curiosity. I
therefore recommend to think of your own header which reflects the gist of your
message.
The same headers then could look differently:
"3.14.5 Keegan's definition of DE outdate?"
"3.14.6 Defining DE - why?"
"3.14.7 Definition of DE: my personal update"
"3.14.8 Why defining DE: my answer to Bob"
I think you all agree that the second series of message headers is more inviting than the first one. They are more informative about their content. However, message headers do serve two functions:
We could include the thread number of the target message for identification.
E.g.
"3.14.5 Keegan's definition
of DE outdate? (3.14)"
"3.14.6 Defining DE - why (3.14)?"
"3.14.7 Definition of DE: my personal update (3.14.5)"
"3.14.8 Why defining DE: my answer to Bob (3.14.6)"
This shows that while 3.14.5 and 3.14.6 were Asides to the Response 3.14, the last two messages were Asides responding to Asides. 3.14.8 is answering the question why it would be important to define DE.
The question remains if the benefits from better threading are worth the while needed for implementing these recommendations. I will not make this obligatory but I will practice what I preach. You may get the hang of it and follow suit or not. Having said this I would, however, insist on two things:
Could all of you accept and adhere to these minimal standards?
The following problems may arise: the message on which I comment is written in HTML (e.g. using dreamweaver) whereas I want to make a short comment only using Plain Text. If I do not want to take the time of deleting this part, below my Plain Text you will find a lot of gobbledigook in HTML You can prevent this from happening by putting an opening square bracket before the first < of HTML code (this looks like ' [< ' ) and a closing square bracket after the last > of HTML code (this looks like ' >]' ).
It is a matter of judgement if I really want to keep the whole message to which I respond. Later, when participants want to print out the whole conference (Click on View Thread; then print) this may be a bit cumbersome. But in a sense it allows you while responding to review what your interlocutor is saying (and even quoting from it). This may strongly improve the discussion. My recommendation: Use this function selectively. Do not include the whole message in your comment but possibly the relevant paragraphs on which you want to comment.
The last point is that I ask you for refraining from is to open main topics yourself in the (content related) conferences. The reason I ask this is because conferences may become easily cluttered this way and loose clarity and focus. You may open a new conference but you should do so only if you have convinced yourself that you cannot post what you want to say as a comment to any of the pre-prepared main topics and that you consider this main topic of sufficient general interest that it attracts further comments. Especially annoying would be questions like 'I cannot open reading XYZ' as main topics. These are process related issues and do not belong in the content conferences. If this is likely your problem only, it may be preferable to email me.
Kind regards
Thomas
Dear all,
I want to draw your attention on the readings. They are placed in the Course Content Area. Furthermore it is worth, look into Reserved Readings where you have access to one of the major Journals of our field: Open Learning: the Journal of Open and Distance Learning.
Here, we have prepared a number of helpful documents which you may want to look at. Note that I do not request you to read through all of them. They are not prerequisites to the course. Nevertheless it is worth to know about them as helpful resources.
Kind regards
Thomas
Dear all,
The general expectation is that you will invest an average a 10 hours workload in each week of the course. The total of about 150 study hours of the Economics course could be broken down into: - 50 hours of reading, - 50 hours of active, visible participation in the discussion groups, - and 50 hours for assignment writing.
We suggest a management tool to monitor your time allocation. It is essentially an Excel worksheet with two columns: one for notes of time invested in either category of reading, conferencing and assignments (your study hours) and another column for notes on content matters you dealt with, remarks on readings, discussions, study groups etc. A drafted first page of such a "journal" is attached at the bottom of this message.
There is an additional reason to keep a learning log for us in the economics group. We will see later on that one of the indicators important in comparing costs of media and educational technologies is the 'cost per student learning time'. How many student learning hours are supported by one online hour of the supporting tutor? Comparing our learning logs might give us an idea about the time ratio between tutorial and student time and therefore a cost-efficiency indication.
Kind regards
Thomas
Dear all,
During this first module we explore the expansion of education, look at the emergence of the economics of education, and finally discuss the contribution distance education could make within this concept.
We explore the expansion of education in two steps: A short main topic will introduce the astonishing rise of formal education, leading to a discussion of the reasons for it, especially since as they are reflected in the new sub-discipline of economics which accompanied this rise: the sub-discipline of economics of education. But to involve you more actively I will ask you to do a little group project and explore the expanding formal education and the soaring costs using an interactive database.
In a short final round of discussion we will situate distance education in this context of rising educational demand and the budget limitations most governments are faced with. This will be an advance organizer for the course: Distance education may contribute to the extent it can provide more cost-effective alternatives of educational provision. Is this the case? This is the driving question of the course.
Kind regards
Thomas
Dear class members,
The first module of this course is about the wider context in which our field of study, the 'economics of distance education' is to be placed. This context includes three elements:
We argue that there is a connection between these issues. The expansion of education during the last half century is breath-taking. Coombs refers to the post World War II development as "the greatest world-wide educational expansion in all human history - an expansion fuelled by hopes and expectations that followed the end of World War II." (Coombs, 1985:3) The expansion was at least partially due to the interpretation of education as an investment, i.e. the human capital theory as applied to education (Papadopoulos, 1994). The project of educational expansion was propelled by a number of factors. They included:
The graph below depicts the expansion of higher education in the postwar period according to Ramirez and Riddle (1991):
Human capital theory is at the same time an ideological answer to the political rivals (see Schultz' reference to the "worker as capitalist"; Schultz 1961) as it lends an economic rationale to give in to the demand to open up education to till then excluded social strata
The emergence of distance education also reflected these two aspects: a political one, distance education as open learning, as 'second chance education', as flexible education, designed to increase access, and the economic aspect: distance education may break the lockstep manner which ties expansion of education to rising costs.
One way of suggesting a link between economics of education and distance education would be as follows: Economics of education analyzes education using the theoretical tools of the economist; distance education (in its Fordist guise) proposes to translate the practical management tools applied in real economic processes (e.g. manufacturing) to education.
In this conference we have opened up three main topics: the expansion of education; the emergence of economics of education and the emergence of distance education. Each of the three required readings for this week refers to one of these topics; Perraton's chapter we need especially for the statistical data on educational expansion; Schulz' article is the seminal exposition of the theory of human capital, which is still at the core of much of what is economics of education today; the Peters' article (which you have read already in the Foundations course) suggests some reasons why distance education seems to respond to the questions of the day.
Kind regards
Thomas
----------------------------
References:
-- Coombs, P. H. (1985). The world crisis in education: the view from the
eighties. New York Oxford: Oxford University Press.Papadopoulos, G. S. (1994).
Education 1960 - 1990: The OECD perspective. Paris: OECD.
-- Schultz, T. W. (1977). Investment in human capital. In J. Karabel , Hasley,
H. (Ed.), Power and ideology in education. New York: Oxford University
Press.
-- Peters, O. (1994). Distance education and industrial production: a comparative
outline (1967). In D. Keegan (Ed.), Otto Peters on distance education. The
industrialisation of teaching and learning. London and New York: Routledge.
-- Ramirez, F. O., Riddle, P. (1991). Expansion of Higher Education. In P. G.
Altbach (Ed.), International Higher Education: An Encyclopedia. Chicago:
St James.
Dear class members,
You have studied the evidence and, possibly, convinced yourselves of the enormous expansion of the educational system worldwide. Obviously such trends in society do not follow a simple cause and effect pattern like 'the melting of the polar ice caps will result in a rising level of water'. Social trends are mediated by the understanding and attributed interpretations of the actors, including their believes and their theories: for instance, the believes of parents that investing into the education of their children would lead to them moving up in society and living a better life; or theories of governments or agencies that investment in education would lead to increased economic growth.
Schultz' inaugural address to the American Economic Association in December 1960 marked the birth of such a theory, the Human capital theory (HTC). It has been and, to some extend, still is an enormously influential theory. Many governments and leading international agencies have acted upon it (e.g. the World Bank, the OECD). It fueled the hopes and expectations of many parents and motivates increasingly adult learners. Indeed, from today's point of view, the central tenet of Schultz' article that better education and skills increase efficiencies both on an individual and a social level, seems obvious. But at the time it meant a veritable paradigm shift to put the budget for education more in the same basket with the budget of industry and technology rather than that of public welfare or health; i.e. to regard education as a factor of production rather than see it consumption of a country's resources. "Education is too important to leave it to the educators" said a leading OECD figure.
Viewing education as possibly productive investment put educators in a better position and made the early postwar years the 'golden age of education'. At the same time, it invited economists to apply their analytical tools to education. A complete set of new questions needed to be asked: What then are the outcomes of educational production? How can we measure them in quantifiable terms? What are their returns? How do therates of returns to educational investment compare to the rates of return elsewhere (say in health or public transport)? How could we determine an appropriate level of investment in education for a country? To which extent benefits from educational investments are private to which extent public? Who, in fact, should pay for it?
These are complex questions which cannot be answered here and go beyond the immediate scope of the syllabus. If you are interested to follow them up in more detail, read the article of Psacharopoulos (1995) (see under Course Content in the class menu). Psacharopoulos was a leading researcher of the World Bank. You may have difficulties with some details, but you will soon get the gist of his argument. It suggests a method to determine the level of returns to education, how to distinguish between private and social returns to educational investment. His analysis has implications for ranking the importance of public investment into the different levels of education.
However, whatever the truth of human capital theory might be and to which extent economic growth might be attributed to investment into education, what became hurtfully clear, especially in those years of recession, was that, together with the expansion of education, costs did rise and that whatever returns to education may have been reaped, they did not find their way into the coffers of the ministry of education to such an extent that they would sustain the rate of educational expansion. To some extent the general acceptance of HCT has lead to shifting vast chunks of public budgets towards education. However, especially where educated unemployed swamped the labor market, reluctance grew to condone unrestrained preference to educational budgets.
The analysts of education use tools borrowed from economics. They soon observed that the expansion of education was strongly linked with rising costs. Indeed, even unit costs, it was pointed out, had the tendency to rise. They observed that in education there seemed to be a lockstep manner in which educational costs are linked to volume of activity, especially the number of learners. Elsewhere, e.g. in the health sector, division of labor, application of technology, standardized, and rational methods of production etc., were adopted and did increase efficiency. Would it not be possible to do the same in education?
To those who looked at education with the eyes of an economist, distance education must have looked especially attractive if at all Peters (1967, see the reprint in the Course Content) had correctly identified the specific traits of distance education (its rational methods of production, division of labor application of machinery) which made it the "most industrialized form of teaching and learning".
This leads us to the next main topic. Here you are invited to comment on T. Schultz's seminal paper and shape your own position to which extent education may profitably interpreted as an investment and be analyzed with the tools of the economist.
Kind regards
Thomas
--------------------------
References:
-- Psacharopoulos, G. (1995, January 20). The
profitability of investment in education: concepts and methods.
Retrieved 09.22, 2001, from the World Wide Web: http://www.worldbank.org/html/extdr/educ/edu_econ/inv_ed.htm
Dear class members,
The last main topic resumed the discussion of distance education as "the most industrialized form of teaching and learning". You have read the article already in the Foundations course. In Keegan (1994) you find a description how Peters arrived at his theory. As a young scholar in 1964 he was commissioned to do an international survey on distance education. What he observed made him believe that DE was indeed a form of educationsui generis and that it was so special because it was "the most industrialized form of teaching and learning".
What happened then is a good example of the relevance of theories. As it was said already with respect to human capital theory, social trends are mediated by social actors holding believes and theories about what is the case. This applies also to this influential theory of Otto Peters. It can be seen as 'contingency formula' which guides educational planners in dealing with uncertainties/contingencies since it had identified specific strengths of distance education. At the same time the theory also identified the negative aspects (tradeoffs) of this most industrialized form of teaching and learning: e.g. the possibility of alienation and isolation.
Note that Peters proposed his theory of distance education already in the late sixties when personal computers had not yet entered the market. Even educational radio and television were rather in the beginning. The predominating technology in distance education was that of the development, production and distribution of printed material (correspondence education). This is why in his theory division of labor and organization are stronger highlighted than application of technology. (Only a few years later the British Open University was planned under the name 'University of the Air'. The name should distinguish it from mere correspondence schools and should highlight the role educational broadcasting was intended play.)
Why is Peters theory so important in the context of economics of distance education? The key factor for success of manufacturing industries, as identified in economical analysis, is how to bring down unit costs. Manufacturing industry has done that by using those very features Peters had identified as reflected in distance education: division of labor, rational methods of production, standardization, application of technologies.
You have studied the article in some detail in the Foundations course. Does it lends some rationale to expecting distance education to be more cost-effective than conventional education?
Kind regards
Thomas
Dear class members,
Philip Coombs refers to the recent expansion of education as "the greatest worldwide educational expansion in all human history - an expansion fueled by hopes and expectations that followed the end of World War II." (P.H.Coombs, 1985 The World Crisis in Education, New York, Oxford: Oxford University Press, p.3) It is within this general expansion of education that distance education has grown.
This main topic should facilitate two things:
Step 1: Graphing and analyzing the Perraton data
One way of doing the first thing is to look at the attached Excel file below. It contains Table 1.1 in Perraton (2000, p.3). Test your skills to generate a graph in Excel and interpret it. Obviously, we are especially interested in the cost implications of such expansions, hence you find also Table 1.2 (also from Perraton, 2000) attached.
Based on your graph(s) you formulate a number of observations. They may relate costs and enrollment in one category of countries (e.g. industrialized countries), or compare the graphs for different countries in some periods. You select one of these observations in order to "check them" with an appropriate sample from the Global Education Database.
Step 2: Using GED 2000 for triangulation
The Global Education DatabaseGED 2000 was created by USAID on the basis of UNESCO resources. It is a useful resource for the professional in the field of educational planning and research. It allows us to 'triangulate' the summaries presented by Perraton by taking our own look at the UNESCO databases.
The installation of GED is easy and having installed it, you will find it equally simple to handle: There are two menus, one on Countries, and one on Indicators. According to the observations you have decided to triangulate you select a country (or several countries) and then a number of relevant indicators. There are many indicators available (e.g. the gross enrollment rate, GER). They can be displayed for several years. The software already allows you to present the data as a graph. However, you may also export the data to Excel and generate your graphs there.
Optional visits
In addition you may visit some quite informative websites of the major organizations involved in global education (in terms of funding, policy making and research). I suggest to visit the websites of the following organizations,
The exact task is described in the Study Groups area. Click there and find your group. Have some fun.
Kind regards
Thomas
______________________________________
References:
-- Coombs, P. H. (1985). The world crisis in education: the view from the
eighties. New York Oxford: Oxford University Press.
Dear all,
the first Module: Expansion of education and the emergence of Distance Education comes now to an end. It was quite a lively discussion in the main conferences space until the focus shifted to the study group work where the task was different but, in most of the study groups, participation remained intense. Therefore first of all I want to express my appreciation that you showed so much interest in the issue which is always motivating to the faculty teaching the course.
At times the the message volume was so high that it became difficult to follow the different threads. Unfortunately there was little adaptation of my suggestions regarding message headers. Many of you just pushed Respond and not changed the headers often also not said whom you addressed. If one wanted to put the message in context it was cumbersome. (In fact my way of putting 'tracer numbers' behind the message headers contributes to the confusion when you push Respond only since the 'tracer number' is repeated in your response which is wrong.)
The stated objectives included
There were three main topics relating to the content of this module which is intended to set the context for the course: (i) The expansion of education (which in fact received no direct responses but was treated in the group task), (ii) the emergence of the economics of education which received with 119 messages the highest number of responses; (iii) and the emergence of distance education.
This main topic emphasizes the new situation that education is expanding in a historically unprecedented way. The main topic introduces the issue which is to be explored as a group task (collaborative task in triangulation).
This is a complex issue. What we wanted to do here is first of all make you aware of the economic aspect of education. This is maybe for you (paying considerable tuition fees) a trivial aspect of which you are well aware. We introduced a seminal text, Schultz paper in which he developed human capital theory. This paper is widely seen as seminal since it is the beginning of a 'research program' the core idea of which is that people invest in themselves, i.e. forgo immediate consumption for future benefits. This research asked a number of questions: (i) how to measure the return to investment on education? (ii) who is the main beneficiary of such an investment, the private individual or society as a whole? (iii) are the returns on educational investment different for the different levels of education? (iv) who should pay? (iv) how can theoretical insights be translated into effective policies?
You learned about the distinction between private and social RORE and how it is measured (cf. my comments 3.1.2 and 3.1.4). The findings here are that the higher the level of education the more private and pubic returns diverge making a case for cost recovery of especially tertiary education; that especially the social RORE are high for primary and (slightly less) for secondary education which makes a compelling case for publicly ensuring this level of education.
However, besides reporting these findings you became aware of the fact that this is a complex matter and there is little consensus in many aspects. While there is mainstream acceptance that primary/ basic education should be guaranteed, the methodology of the RORE approach has come under attack. Especially, the fact that developing countries have invested much in education without getting the economic impact in terms of growth demonstrates that the issue is more complex than the RORE methodology would have it. - I hope it is acceptable to you that you end this module with more questions than definitive answers.
Let me pick some issues I found particularly interesting in the course of the discussion. (Please, accept that it is not a summary but a rather personal selection.) - In the discussion you spontaneously endorsed the concept of education as investment from a private rate of return view. (E.g. Kathleen 3.1, Sally 3.1.1. In fact, the issue was taken up again later: one hopes for private returns on investment in education but it is not guaranteed e.g. Anna Christina in 3.2.34) I tried to emphasize the social rates of return side. There is a difference between 'investing in people' (e.g. by governments, or businesses) and 'people investing in themselves'. These are different perspectives within the Human Capital Theory: the macro-perspectives looks at governments, the relation between investment in education and return on the investment in terms of more or sustained economic growth; the micro-perspective which looks more from the individual point of view, i.e. 'people investing in themselves'. (Grady Sutton).
There was a discussion on externalities (Sharon, 3.1.13). RORE analysis is a sort of cost benefit analysis (CBA) which tries to compare alternative forms of investment. CBA tries to quantify costs and benefits in monetary terms and eventually identify cost/benefit ratios for each investment which then can be compared. The aspect of beneficial external effect on educational investment is an interesting issue. It shows that you need to keep your cost/benefit type of analysis in perspective. CBA should inform educational planning but not be taken as a substitute for it. Educational planning has to keep in view wider perspectives and accept that it is impossible to measure all aspects. This is also reflected in Sharon's comment on 'intangible ROI' (Sharon, 3.2.4).
Very helpful to get the discussion going I found 'Schultz for Dummies' (3.2) where Bob Welton wrote down his reading of the Schultz article down. This posting triggered a lot of comments and responses.
Anna Christina (3.2.22) was bringing up the issue of continuing education. This is interesting and brings into view again how much education has been structuring our lives. It has been an accepted cycle to pass through primary, secondary and for some tertiary education and then apply what you have learned in your job. The world of production has become more complex such that managing a Hamburger outlet require substantial training (operating globally you need to be aware of legal regulations in various jurisdiction, of food processing chemistry, health standards, cultural aspects of marketing your product to different customers etc.). At the same time job security is eroding people need to change jobs and consequently retrain. This leads to a vocationalization of education (people get itchy when it comes to open question with no clear answers theoretical deliberations which are seen as wordy and practically irrelevant) which is a problem when it comes to higher education.
In 2.2.28 Charlotte responded on my comment that historically education was not seen primarily in terms of skills but in terms of morals. In the short exchange it became clear that I gave the word 'moral' a historical twist. It referred to a literature who saw schooling as instilling discipline and obedience, punctuality, cleanliness, sobriety rather than skills.
In 3.2.44 John brought up the tissue of per student costs. I want again to underline this issue since it is central to distance education. Industrialized education (you all probably hate the expression?) will bring down cost per student because of scale economies. Scale economies can be harvested because the high investment in excellent pre-prepared course packages comes together with reduced cost of tutoring/communication and can be spread over many students. But you probably will correctly argue that this is not the distance education you experience here which leaves considerable room for communication. This suggests that within distance education you will find different cost structures. This issue will be taken up extensively throughout the course.
This main topic sets the scene for the main question of this course: the demand is high, costs are soaring; we need to find more cost-effective way to offer educational opportunities. Is distance education a solution? Why, under what circumstances? These questions will be treated in the following modules and we choose a paper by Peters to get the ball rolling. Peters has found that distance education uses to a greater extent methods of division of labor, standardization, rationalization, all characteristics of mass manufacturing which brought prices also for quality products down. Distance education 'as most industrialized form of education' has a potential here to respond to increased demand in a cost-effective way keeping quality high while at the same time expanding access. Coombs (1985) already in the eighties asked why professions like medicine had organized itself in a more efficient manner (adopting principles of division of labor, use of machinery etc.) and why education is still unable to do the same.
Again let me rather subjectively pick some points I think particularly worth considering. First, there was a general agreement that from participants point of view it is flexibility which counts most (e.g. Kristie 4.13, Beulah 4.14). Flexibility implies substantial savings in costs, not having to commute, not having to plan for large blocks of free time etc. This can be seen as savings in opportunity costs. Time was immediately seen as an issue. I picked up the issue of time and pointed to the changes in distance education through reintroducing the classroom. Even in asynchronous communication this reintroduces pacing and in addition time might be lost because of the white noise generated by the high volume of online communication. I referred to an article by Ainsworth (mainly because the title so nicely encapsulates the provocation). This produced quite an emotional exchange (Charlotte 4.1.15, Steve (more amused (4.1.17)). But the idea of 'white noise' was discussed (41.25 Sue).
Quite important the substantial posting by Laura who made it clear that the process of industrialization did not bypass traditional education. Traditional universities were (my informational base is the UK) forced to demonstrate increased 'internal efficiencies'. You should take up the issue with Greville who shares this point of view and argues that if we would start the comparative research between traditional on-campus and distance education the result would be less clear now as it has been in the seminal studies by Wagner (1972, 1977) and Layard & Laidlaw (1974). Bob (4.2.2) contributed an example where the distance approach had failed. (An ironic example was the 2002 LearnTec when Sir John Daniels exalted the virtues of the Open University model and in the afternoon of the same day it became public that US Open university project had failed. Dohmen in his report on costs of elearning also argues that elearning seems to be deflated and not anymore seen as the solution to all problems.
Comes the usual discussion on 'students as customers'. I am quite ambivalent on the issue. In fact, previous more paternalistic approaches (typical for German universities where you call your PhD supervisor 'Doktor Vater' (doctoral father)) I also dislike. But the customer lingo seems to imply that education is something external to you. But good education my affect and influence your very farmeset of evaluation. I often try to make this difference visible by reference to the 'notion of the naive customer'. But essentially I see that when moving from traditional education settings to adult education where adults have to pay, that there needs to be a substantial change in attitude of the respective staff.
John (in 4.2.9) brought in the aspect of accreditation and branding. Also an interesting issue which may come up in the discussion with Greville again. Dual mode universities, especially established one may attract more students even with less quality distance teaching offerings as long as off campus students would receive the same degree as on-campus students. In countries where distance education is still seen with some suspicion as second best alternative, distance education students like to camouflage their mode of studying.
In 4.6 Steve argued that there need a different model of distance education other than Peters industrialized model. I think this is true and we will try to describe it in greater detail. The point we need to analyze during this course is if this alternative model also allows us to expect that it is more cost-effective, especially that cost per students decrease because of the particular cost structure of DE. Bridget (4.8) may refer to such an alternative model (note the new trendy term 'blended education'!) Maybe this is where the different uses of using educational technologies will converge? - I just leave it here for now.
Part of professional education of distance educators is to make use of resources available on the Internet. Here, in addition I wanted you to get some hands on experience with Excel (saving the GED data as Excel files and presenting the data as graphs). The idea was to identify important parameters reflecting educational expansion and soaring costs and construct a profile for a sample of countries.- I do not include as yet comments on the group task but the limited discussion in the main conference led already to some clarification especially with regards to the important gross enrollment rate indicator and the question why it can be more than 100%.
I think it has been a multifaceted discussion with interesting points. Only skimming the contributions in terms of size (average number of words per message which is 266) we see that it is not a superficial exchange. It might have been too much with 338093 words overall. Thanks again for the engagement which, I hope, will continue when we come to the second slightly more technical module.
Kind regards
Thomas
________________________________
References:
-- Wagner, L. (1972). The Economics of the Open University. Higher Education,
1, 159-183.
-- Wagner, L. (1977). The Economics of the Open University Revisited. Higher
Education, 6, 358-381.
-- Laidlaw, B., and Layard, R. (1974). Traditional versus Open University teaching
method: a cost comparison. Higher Education, 3, 439-468.
-- Dohmen, D. (2002). Costs and financing of elearning (3rd interim report):
Stifterverband der Deutschen Wissenschaft e.V.
-- Coombs, P. H. (1985). The World Crisis in Education; The View from the Eighties.
Oxford, New York: Oxford University Press.
Dear all,
a bit delayed my comments. I appreaciate that you have made an effort to do non-graded work. However, let me make some (mainly critical) remarks.
Study Group 1
The Excel document was not informative at all. The word document referred several
times to the Excel document but the references could not easily be substantiated
since the data display did not include headers. The presentation of the main
document was better. The central idea was also not bad. You said Perraton wanted
to make a case that DE was a way of coping with numbers giving the limited budgets.
You wanted to show that population rate grew more than educational expenditure
therefore putting pressure on increasing internal efficiencies. Therefore governments
would turn to DE. This argument could have been presented a little clearer but
provides a valid starting point but given the somewhat elliptic data display,
the group work is not altogether satisfactory.
Study Group 2
Excel documentation is informative. A good idea is to look at 'measures of
effort' rather than absolute numbers. Such a measure is to which extent a country
sacrifices additional resources to education. "Total Public Expenditure
on Education as % of Total Gov't Expenditure" is such a measure of effort.
However, at times interpretation is unclear. You say for instance "The
data reflected that the economic downturn of the 80's did in fact impact expenditures
on education." Your data for Venezuela for the early to mid 1980's do not
confirm this interpretation. You say further "What is striking is that
as the percentage of government spending dropped in Jamaica in 1980 and 1985,
the spending as a percentage of GNP was up." I do not see the data confirming
what you say. The group work again is not satisfactory in the sense that interpretation
of data lacks transparency.
Study Group 3
Data were exported from GED into xls without further treatment. Presentation
could have been improved if you would have exported and then treated the display.
- You have compared expenditure between the UK and SA rather than % expenditure
of education to as compared to total budget (as Group 2 did). It is questionable
if such a comparison is telling more than the rather trivial fact that a rich
country invests more in education than a poorer one.
You need to work on APA style.
Perraton, H. (2000). Open and distance learning in the developing world.
London: Routledge.
or
Perraton, H. (2000). Open and distance learning in the developing world.
London: Routledge.
Study Group 4
Very nice chart. I like the picture included. Generally I prefer line graphs
to depict developments.- You have been a bit unlucky in your choice of countries.
Mozambique is really an exceptional case since beyond the oil price it were
the political disturbances which destroyed the country. First the liberation
war against colonial (Portuguese) rule triggering the exodus of the whites leading
to a breakdown in many production activities; then after Zimbabwe became independent
the South African apartheid regime initiated a brutal war in Mozambique. The
government had to negotiate with real gangsters and finally degraded to a sort
of 'aid economy'. All this happened in the eighties. You would not expect that
you could find global trends being reflected in Mozambique. Conclusion: In interpreting
data you need to have an eye on context:
You make a number of observations leading to the role lack of teachers necessary
for a good quality expansion in education. This is a valid point. For teacher
education distance education has proved a cost-effective option especially in
developing countries (and especially as in-service education).
Study Group 5
Poor spreadsheet presentation. Basically use line graphs to depict developments. Represent in one chart what you want to compare (e.g. developments of GER in China and India). The interpretation goes way beyond the data when you say that India is technologically less advanced. But you may well be right though as the below footprint analysis (Mansell., Wehn, (Ed.), 1998) indicates.
Mansell, R., Wehn, U. (Ed.). (1998). Knowledge societies: information technology for sustainable development. Oxford: Oxford University Press.
Study Group 6
You write: "Negative enrollment growth for Zimbabwe and Tanzania may be a result of economic and social crises in these countries as indicated in the data obtained by UNESCO." This is probably correct. But the chain of reasoning seems not to be valid. Slow or negative increase in primary GER may be often due to (and is so in industrialized countries) since increase approaches the 100%. You point at the 0.2 increase for developing nations, for industrialized nations is 1. Note well form 101 to 102 meaning only that the numbers of repeaters increase. Increase in this case indicates inefficiency rather than expansion.
Summary: some good efforts especially given the fact that the essay is not marked. But often not good enough for what I would expect for an assignment. I do admit that the task was not quite clearly spelt out and that GED data are often frustratingly incomplete.
Kind regards
Thomas
Dear fellow class members,
Welcome to the Module 2: The Techniques of Cost Analysis.
We climb down a bit from the lofty theoretical heights of 'human capital theory' and complex issues as the 'rates of return to educational investment' to more down-to-earth questions. While the introduction was intended to convince you of the relevance of the issues (by putting forward more questions than providing answers), in this module we want to learn the basic tools required for cost analysis. The instructional core of this module is provided by the first chapters of our textbook (Rumble, 1997), which you need to read for this module from the beginning up to page 77. Within the three weeks of the module ( about 30 study hours) we have reserved the third week for the writing of the assignment. The first two weeks are mainly calculated for reading and discussion.
To facilitate the discussion of the textbook, we have so far prepared a number of main topics for this conference, which largely follows the outline of Greville Rumble's book. The first topic, "Budgets and the classification of resources", embraces chapters 2 and 3, the second main topic, "The mathematical model of total and average costs", pertains to chapters 4 and 5. The main topics on "Fixed and variable costs", "Semivariable costs", "Total cost equation", "Average cost equation","Marginal costs", and "Break even points" all belong to these chapters. The last main topic, on the "Treatment of capital costs", refers to chapters 6 and 7. Spreadsheets will be used mainly for chapters 4 and 5 when we deal with mathematical modeling. A further application for the use of spreadsheets will be the annualization of costs (in chapter 6).
We expect that while you are reading you will make notes and post your questions and comments to the respective main topics. This way, we will progress through the readings while discussing them. In the first week of the module, you will concentrate more on reading, while in the second and the third week of this module I expect conferencing may take up more of our time. You should have finished the bulk of the reading by the beginning of the fifth week. I will release the assignment for this module at 03/01.
Note, that, in principle, you also can open 'main topics' yourselves. However, you should do this only if you have an issue at hand which cannot be classified within the framework of existing main topics and which is likely to attract further comments.
Kind regards
Thomas
The readings for this main topic include Rumble, 1997 pp. 1-20.
Dear fellow class members,
When asking for the 'social returns to educational investment' we look at the outcomes of the educational system for society as a whole. What does education contribute to growth? Is the output of education (e.g. the engineers, lawyers, doctors) properly 'absorbed' by the labor market or not? These are problems of external efficiency and relate to the interface between the educational system and the society as a whole. Question of external efficiency are asked by economists in the context of planning or when evaluating the allocation of public resources. We shift the focus of our attention now from external efficiency to internal efficiency which relates to the smooth working of the educational system itself or its parts. While narrowing the focus, we should not forget that the problem of external efficiency remains in the background and is not necessarily solved by optimizing internal efficiency. You may train mathematicians quite cost-effectively within the given professional curriculum but it might be that these goals themselves towards which the subsystem (e.g. a university department) is producing, are outdated and the respective graduates are not absorbed into the labor market. Increasing 'internal efficiency' means to reduce the inner friction of the institutional machine. A system is said to be efficient if the ratio of inputs and outputs of the system is minimized (generally as compared to some alternative ways of operating the system).
In this module we acquire the tools to assess the (internal) efficiency. Cost analysis is a central prerequisite to do this. Most authors agree that it is of prime importance first to clearly identify the purpose of the cost-analysis. This is important in order to determine the level of analysis. While the economist often is interested in all costs, independent to whom they incur, the managers' perspective is more partisan and interested in aspects of costs and revenue only in as far as their company or institution is concerned. Minimizing costs for the company not necessarily means making the process as such more efficient. It may just devolve some costs to third parties, possibly to the client. Even within a company costing can serve different purposes: it can try to assess the situation of the company as a whole or, more often, it is intended to cost a specific operation or activity. The purposes of costing therefore differ with respect to level of analysis. They obviously also differ with respect to time. Costing can be done ex ante in order to construct a budget or it can be done ex post as auditing or for the purpose of evaluation. Having decided on the exact purpose of the costing exercise, cost analysis basically proceeds by identifying the resources required for the operation under consideration, then classifying them by means of a set of categories which ensures that your account of the required resources is comprehensive and, finally, attaching price tags. Lewin, a renowned writer on cost-effectiveness, refers to this procedure as the ingredient approach of cost-analysis (Levin, 1983, 1995)
However, generally the purpose of costing is not purely descriptive. A proper classification of costs and their feeding into a mathematical model allows you to explore the behavior of costs as a response to changes in some of the parameters included in the model. This is to be considered in the next main topic
Kind regards
Thomas
_________________________________
References:
-- Levin, H. M. (1995). Cost-effectiveness analysis. In M. Carnoy (Ed.), International
encyclopedia of economics of education (pp. 381-386). Oxford: Pergamon.
-- Levin, H. M. (1983). Cost-effectiveness: a Primer. London: Sage.Sage:
London
Dear fellow class members,
Since I consider the basic mathematical model of total and average costs as of central importance for understanding the cost structure of distance education I want to supplement the chapters 4 and 5 of Rumble (1997) by a set of comments and spreadsheets. Consequently, I will open a number of further main topics. To each of them you find one or more interactive spreadsheets attached. You may use these spreadsheets to explore how various parameter relate to each other. However, they contain nothing which is not also treated in the textbook.
The following subsequent main topics are related to the basic cost model:
1. Fixed and variable costs
2. Semi-variable costs
3. The total cost equation
4. The average cost equation
5. Marginal costs
6. Break even points
Before turning to the simple mathematical argument underying the cost model, let us discuss the central idea. This is as follows: distance education and conventional education differ in their cost structure, i.e. the composition of total costs in their fixed and variable components. Conventional education (CE) for instance is said to have a higher component of variable costs, e.g. teachers' salaries. Conventional education thus has to follow the following logic: If you want more students to be taught, you need to increase the number of teacher hours. Thus the costs are linked in a lockstep manner to the 'volume of activities', which means in our context 'number of students' in the system. In Distance education (DE), on the other side, the fixed cost component is said to be higher (e.g. the production cost of a television lecture). But once these costs are met, they are no more tied to the volume of activities. If 10 or 1000 students view the televised lecture, the cost remain the same. Distance educators argue that the specific cost structure of distance education is better compatible with mass education than conventional education since with each new student the average cost per student is decreasing further. Especially, in countries with large numbers of students, mass access to education is considered to be only possible by means of distance education.
We will look at these claims in detail. But before we are looking at the empirical evidence (e.g. in form of case studies) we will have a look at the mathematical model. This we do for two reasons: first, because the mathematical model is a sort of template for many case studies. Second, because the mathematical model suggests, rightly or wrongly, essential management guidelines, such as: if you keep your unit costs lower than your competitor then you will eventually be more cost-efficient.
The spreadsheets are designed to illustrate the underlying mechanics of the mathematical model. They are not based on 'real-world' data. (The reason for this lies in the difficulties to visualize the mechanics and, at the same time, use real world data at the same time.)
Kind regards
Thomas
Dear fellow class members,
We first need to come to grips with the mathematical relationships underlying the total and average cost formula (Rumble 1997: 35). We have prepared a number of spreadsheets which illustrate the point made by Greville in figure 4.1 and 4.2 in his book. Scroll down to find the attached spreadsheet named 'Fixed and variable costs'. Click on it the icon. You accept the file as coming from a reliable source to enable the macros. What you will see first is a straight line graph, parallel to the x-axis. Regard the labels below the page: Fixed cost graph, fixed cost table, Variable cost graph, variable cost table. We first look at 'fixed costs'. First open the 'fixed cost table'. You can change fixed costs and observe the effect by clicking back to the graph. (Compare Figure 4.1 in Rumble, 1997). You observe that the line representing the fixed costs are parallel to the x-axis. This means that the level of those costs do not depend on the level of enrollment, i.e.the costs do not increase when student numbers go up. In terms of mathematics, the fixed cost function is a constant function. Play a bit around by changing FC2, always observing the effects on the graph. You will see that the new graph is either higher or lower than the original one while remaining parallel to the x-axis. This means the function preserves its main characteristic: costs being independent of level of enrolment.
In reality, however, there is seldom a situation where it makes sense to look at fixed costs only. Variable costs generally have to be included into consideration . Again, lets first look at variable costs separately. Turn to the label 'Variable cost table'. Variable costs are those which increase or decrease with the volume of activities. To give an example, the supply of an individual students with a textbook is a 'variable cost per student'. If each student is to be given his/her book, there will be a direct linear relationship between the number of students and the resulting costs: e.g. when the number of students doubles, the costs will double also.
The cost of one copy of a book in this example may figure as V, i.e. as variable
cost per student. The total variable cost or the aggregated variable costs,
are V x N, i.e. the variable cost per student (cost of one copy of a book) times
the number of students (and consequently of no of copies). (Note well: V
stands for 'variable cost per student' and V x N for 'variable
cost'. This distinction is often blurred.)
Play a bit around with V2. You will see observe that if you increase 'variable
cost per student', the costs will rise more sharply. If you decrease it, costs
will rise slower.
F and V, i.e. 'fixed costs' and 'variable costs per student' are the two important categories to be integrated into the cost model.
Kind regards
Thomas
Dear fellow class members,
If you look more closely at fixed cost, then, more often than not, they turn out not to be as fixed as the definition might suggest. For instance a school building might be regarded as a fixed cost. In fact, you may enroll more student and you may be able to accommodate them on the given premises. But this works only up to a certain level. If the range of your activity, i.e. the number of students enrolled in the school, doubles or triples, then you are likely to need more space. What could have been considered until then as fixed costs, turns out to be variable costs above and beyond a certain level of activities. Such costs you can call semi-fixed or semi-variable (like a the same bottle can be regarded as half full or half empty).
Formally we define semi-variable cost function as follow:
SV (N) = [N/G] x V
SV semivariable cost function with N as the independent variable;
N Number of students (or items under consideration); G group size
(the square brackets signify the process of rounding );V variable
cost per student.
Example:
The standard example is class size and teachers. Teachers can be classified
as variable costs since increasing the number of students will eventually have
an effect on the number of teachers (or, which amounts to the same, teacher
time) required. In most schools a maximum acceptable class size is defined.
Beyond the size the class will be divided and you would need an additional teacher.Given
that the maximal acceptable number in a class is considered to be G=20; the
cost per teacher (per hour) is $40, the function of the semivariable cost is:
SV(N)= [N/20] x $40
(i) For N=125 we get
....SV(125)= [125/20] x $40 = [6.25] x $40 = 6x $40 = $240
(ii) For N=119 we get
....SV(119)= [119/20] x $40 = [5.95] x $40 = 5x $40 = $200
(iii) For N=127 we get
....SV(127)= [130/20] x $40 = [6.35] x $40 = 6x $40 = $240
You see that semi-variable (or semi-fix for that matter) costs showing a certain elasticity. A few students more can be absorbed without impacting on the overall costs. But beyond a certain level such effects will show. In our example: the bigger the group size the greater the cost-elasticity. This elasticity somewhat 'dampens' the effect of V. This is obvious from the formula: the slope of the graph is determined by the coefficient of the independent variable, here N. All things being equal an increase in G (Group size) will decrease the coefficient and reduce the slope. Thus reducing group size is likely to increase costs more quickly. Play a bit around with changing figures for G and V in the attached spreadsheet to observe how the effects show in the graph.
Kind regards
Thomas
Dear fellow class members,
Total costsare the sum of the aggregate fixed costs plus the
aggregate variable costs per student. The mathematical expression for this is
the following:
TC = F + V x N or
TC(N) = F + V x N
where
F stands for fixed costs
V stands for variable cost per student
N stands for number of students
Figure 4.3 in Rumble, 1997 represents such a graph. If you open the attachment 'Total cost table' and 'Total cost graph' you see the respective table and graph. You observe that the total cost graph is similar to the variable cost graph. Only this time, the cost graph does not start at zero level (as the variable cost graph has done where fixed costs are ignored), but on the level of the fixed costs. You may experiment with the two parameters determining the shape of the total cost graph, i.e. the fixed costs (represented by the line parallel to the x-axis) and the variable cost per student (reflected by the gradient).
The important thing you may observe is that the degree, in which costs raise is determined by the unit costs. This means that 'on the long run' (i.e. high number of students), units costs are imprtant , even decisive. Even in case you have low fixed costs up front, your total costs can be higher than in an alternative case of high fixed costs if your unit costs are higher than in the alternative case.
(Note on 'unit costs': generally we use the expression 'unit costs' in order to refer to 'aggregate variable costs per student. What do we mean by that? Generally, there are many 'variable costs per student', such as: cost per student for marking an assignment; cost per student for the study guide; cost per student for posting the study guide; etc.. If we add all these variable cost per student together, i.e. aggregate them, we call them 'unit costs').
The graphs confirm for the total cost development what we already observed for the variable costs. How quick you hit your budget line depends not least on variable costs. Even if you have low fixed costs, you may hit the budget line earlier than an alternative provider with higher fixed costs but lower unit costs and consequently a less steep rise in costs as result of increased activity.
Kind regards
Thomas
Dear fellow class members,
The next important equation, the average cost equation, is a simple
transformation of the total cost equation.
AC = F / N + V
Mathematically the average cost equation is derived by dividing the total
cost by the number of students N, i.e.
AC = TC / N.
But
TC = F + V x N and therefore
TC/N = F/N + V x N / N
resulting in the above average cost equation.
The meaning is that the fixed cost component can be considered as 'being
spread over the number of students' (thus loosing in weight or importance
when the number increases) plus the unit costs. This is why scale matters.
You may explore the relationship by means of the attached spreadsheet. The curve
which asymptotically approaches the line parallel to the x-axis is the average
cost curve approaching the line of unit costs, i.e agreggate variable cost per
student. This is important to know for the manager: Whatever number of students
you ever may enroll, you never can achieve average costs below the average cost
per student.
This immediately highlights the importance of analyzing average cost per student. Having identified your unit costs, you have determined a definitive 'bottom line' below which you never can bring down average costs even if you exhaust all your potential of scale economics. (Recall the meaning of 'unit costs'.The term is generally generally used to denote 'aggregate variable cost per student'. This means: you may have average cost per student for producing a study guide; further average cost per student for posting the guide to the student. To get to the unit costs you need to add together all these different variable cost per student.)
Again, play around with the parameters FC2 (fixed costs) and V2 (unit costs) in the spreadsheet. Increase FC2 and lower V2 as compared to the respective default values. Then you have the situation, which those who claim the cost-efficiency of distance education, regard as characteristic of the cost structure of distance education. The graph shows two pairs of curves: a dark one and a yellow one. The yellow one may represent distance education and is characterized by higher fixed costs and lower unit costs. On the long run, i.e. with student numbers rising, the alternative with the lower unit costs will achieve lower average costs.
Kind regards
Thomas
Dear fellow class members,
Marginal costs (MC) are the cost of including one additional person into the system.
Formally, this is reflected in the following calculation:
MC = TC (N + 1)- TC (N) = [FC + V x (N + 1)] - [FC + V x N] = FC - FC + V x
(N + 1) - V x N = V
This means that marginal costs do not depend on N, i.e. the actual number of students enrolled. Marginal cost are therefore identical with the aggregate variable cost per studen or unit costs. Graphically, V represent the asymptotic line towards which AC converges. This underlines the difference between average cost and marginal cost. In case, for instance, when scale economies are far from being realized, average cost per student can be regarded as distributing the 'inefficiencies' of the system equally.
The distinctions is relevantin questions like this: this course has, for instance, no market in Africa since fees are too high. The fees are set slightly higher than the average cost per student. At this level you have no market in Africa. Would it make sense to increase the market by charging African students fees slighly higher than the marginal costs? - A similar example in which the relevance of the distinction comes up is in the debate of student fees for foreign students: should their fees be determined based on average costs or on the marginal costs?
Kind regards
Thomas
Dear fellow class members,
Often you hear people talking about 'break-even points'. The concept is, however, used in two different ways: (i) One is looking at cost and income, (ii) one compares the costs of different modes of educational provision (e.g. distance education versus conventional education or using one technology as compared to another one).
(i) Break-even point: comparing cost and revenue
Assume we want to offer a course, the cost of which we can model according
to the cost equation TC = F + VxN. Our marketing department tells us that we
can reckon to have N0 students. How would we need to set our course fees in
order to break even?
We assume here that the only income (I) comes from student fees (FE). We have
then I (N) = FExN. To identify the break-even pint is equivalent of finding
the B=N for which I(N) = TC(N), i.e. the number of students for which total
costs and total revenue are equal. This is the case if:
I(N) = TC(N) or
FExN = FC+VxN
Solving for N gives
N = F/(FE-V)
Since this N is the exact number we wanted to find, i.e. the break-even point
B, we can write:
B = F/(FE-V)
(ii) Break-even point: comparing cost of alternative types of educational provision
Rumble uses the term in the second sense comparing the cost of alternative modes of educational provision. The question here was to compare the institutional cost-efficieny between conventional education and distance education. If distance education (DE) has higher fixed costs than conventional education (CE) but lower unit costs, how many students we would need to 'break-even', i.e. arriving at the same agerage costs? The idea is illustrated below.
Here we compare two cost equatuions TC1 (for conventional education, i.e. CE) and TC2 (for distance education, i.e. DE). The break-even point is achieved where the graphs coincide, i.e. the number N=B for which TC1(N) = TC2(N). This is the case if:
F1 + V1xN = F2 + V2xN
Solving for N
N= (F1-F2) / (V2-V1)
Since this N is the exact number we wanted to find, i.e. the break-even point
B, we can write:
B= (F1-F2) / (V2-V1)
Both definitions of the break-even points are used and we need to pay attention which definition is used.
Kind regards
Thomas
Dear all,
In the treatment of capital cost we need to reflect on two issues: time and choice. The very definition of capital cost means that capital goods are distinguished from consumables in that their lifetime extends over more than one financial year. This already signals that capital costs has something to do with time.
The relation to choice is reflected in the concept is of opportunity costs. Livesey defines cost in terms of opportunity costs (Livesey, F. (1993). Dictionary of economics, London: Pitman Publishing ). I quote:
"The cost of any action is what is forgone given up as a result of taking that action. For a firm, the cost of using its resources to produce more of one good is the value of other goods that could have been produced by these resources. .... The term given to these forgone alternatives is OPPORTUNITY COST. Opportunity cost is an immensely powerful idea with many applications in economics." (p.46)
Let us first look in some more detail on the issue of time. Why time is important? There are several aspects. Take an example: For a project a computer has to be bought. The computer will used over several years till it becomes useless. We may see this as a gradual consumtion of the value of the computer. This value is represented by costs, which we classify as capital costs, exactly because they represent a value whose lifetime exceeds the finacial year. There are a number of methods to include such costs into our cost calculation:
Depreciation
How is time treated in case of depreciation? Depreciation is intended to reflect the loss of value over time, the wearing out of an items usefulness.
| Value type | Amount | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
| Initial value | 1000 | |||||
| Depreciation value | 1000/5 =200 | 200 | 200 | 200 | 200 | 200 |
| Written down value | 800 | 600 | 400 | 200 | 0 |
The written down value reflects the fading value of the item. The procedure
is as follows:
1. determine the replacement value of the item,
2. define the likely lifetime of the item,
3. divide the replacement value by the lifetime to obtain the cost of depreciation
for each year;
4. successively subtract the cost of depreciation from the replacement value
(see table) to get the written down value.
Social discount
The written down value represent resources which you cannot put to alternative uses because they are locked in the respective capital good. Taken as locked up money which one alternatively could use otherwise, one forgoes interest. The locked up value in the first year is 800, then 600 and so on. For each of these values I forgo interest. In the following we assume an interest or r = 10%. In line five we calculate the compound interest (he formula is attached: C is the written down value, i.e. the non-depreciated part of the capital cost).
| Value type | Amount | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Total |
| Initial value | 1000 | ||||||
| Depreciation value | 1000/5 =200 | 200 | 200 | 200 | 200 | 200 | 1000 |
| Written down value | 800 | 600 | 400 | 200 | 0 | ||
| Compounded | 880 | 726 | 532 | 293 | 0 | ||
| Forgone interest | 80 | 126 | 132 | 93 | 0 | ||
| Social discount | Depreciation + forgone interest | 280 | 326 | 332 | 293 | 200 | 1431 |
Annualization
There are others who prefer to annualize capital costs. The central argument is that you should assess the services or the usefulness derived from the item. Since the usefulness is the same (cum grano salis), we should not have varying values in the last row of the table. In fact, a formula was developed which DETERMINES something like an average over the values in the last row of the above table. The formula is the following:
(Find below a spreadsheet ('The annualizer') which does the calculation for
you. If you want to understand the fomula, as somebody in the last term wanted,
you need to tread a bit the grounds of mathematics. Find 'Explaining annualization'
attached below.)
For the above figures we have a(10%,5)=0.264 (compare also the annualization table in Rumble: p.46). This multiplied with the capital cost which is to be annualized to get: a(r,n)xC= 0.264x1000=264 (Compare with the average over the social discount tranches: 1431/5=286)
| Value type | Amount | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Total |
| Initial value | 1000 | ||||||
| Depreciation value | 1000/5 =200 | 200 | 200 | 200 | 200 | 200 | 1000 |
| Social discount | Depreciation + forgone interest | 280 | 326 | 332 | 293 | 200 | 1431 |
| Annualization | 264 | 264 | 264 | 264 | 264 | 1319 |
I hope this allows you to better compare the different approaches.
Kind regards
Thomas
Due: XX (Midnight EST)
This assignment starts by describing the scenario of a project. The various ingredients required for the project and their unit costs are in detail specified in an attached spreadsheet. In a second section the assignment-tasks are specified. These tasks mainly consist of simple calculations to be completed according to the cost-analysis outlined in the textbook. For completing them, please use the specified cost data provided even if they do differ from costs you know from your context. Include references to the textbook of G. Rumble to justify your solutions where appropriate.
The scenario
Red Oaks University plans to offer a Diploma in Mathematical Modelling . The course aims at adult learners who use mathematical reasoning at work but are interested in extending it to a wider realm of applications. Especially it is targeted at teachers teaching applied mathematics at college level. The courses concentrate on the development of mathematical models for real-world applications. The applications are largely taken from physics covering statics, Newton's laws, and oscillations as well as the motion of rigid bodies. The mathematical techniques required for this extend from numerical methods, differential equations, and linear algebra to advanced calculus.
The Diploma comprises three courses each earning three credits and requiring about 150 hours of study time (15 weeks at 10 hours per week in the Spring and Fall term, and about 20 in the Summer term). The diploma can be completed in one year.
The development process extends over three years and will require a half of the per annum staff-time of a course manager and 2.5 of a full time commitment of one secretarial staff. A course web site will be developed for the course which requires five days of work by a web designer. The course is planned to be on offer for eight years and is expected to attract 300 students per course.
Course material: the core of the course is print based. The course material is written by three consultants who are renowned experts in their fields. It consists of nine study guides of about 50 pages each (three for each course). In addition student receive a booklet with assignments each term. Together with the study guides come three CD ROMs (one for each term) including CBTs in the respective fields. In a ddition 9 x 30 min videos are produced presenting key demostrations for each topic (3 for each course).
Student support: Students are supported by a tutor. Each tutor caters for a group of 15 students. Each tutor is paid for 2 x 5 hours workshop each term (amounting to 30 hours per group). In addition the tutor marks and extensively comments nine assignment per student. In addition he will grade the final exam paper.
Details you find in the attached spread sheet. You are expected
to fill in the green marked space. Note also the red triangles in the ingredient
spreadsheet. They indicate comments which you can read by double clicking on
the respective cell.
The Task
Based on the above figures and the scenario, please, answer the following questions. Include references (not lengthy quotations) to sections of the textbook to support your argument where appropriate.
Please, note the attached Excel file. They summarize the information in a Excel format.
General remarks to the format of presentation
You need to upload two documents: (a) a text document, (b) an Excel spreadsheet. To both documents add your name.
(a) For the text document should use Rich Text Format (*.rtf).It should include explicit answers to each of the above questions. Only in case of the graphs you may refer to the spreadsheet. The document should summarize all the answers in such a way that it is only necessary to refer to the spreadsheet in case of differeing calculation results.
(b) Note for the excel spreadsheet: Use the provided template for your answers; calculate using a number format of 3 digits after the decimal point; make sure that your spreadsheet could be printed out in A4 landscape format.
Use the following header on top of your essay:
[Your Name]In case you face technical problems with WebTycho, you may also send your essays as E-mail before the due date to: thomas.huelsmann@uni-oldenburg.de with a cc to huelsmannthomas@web.de
Best wishes,
Thomas
Due: March, 13 (Midnight EST)
This assignment starts by describing the scenario of a project. In a second step it identifies the various ingredients required for the project and their unit costs. (The information included in this table you find repeated in the attached spreadsheet.) In a third section the assignment-tasks are specified. These tasks mainly consist of simple calculations to be completed according to the cost-analysis outlined in the textbook. For completing them, please use the specified cost data provided even if they do differ from costs you know from your context. Include references to the textbook of G. Rumble to justify your solutions where appropriate. This applies especially to tasks 6 and 13 where you have to discuss the issue of annualization (task 6) and to summarize the argument in favor of the cost-efficiency of distance education (task 13).
The scenario
An undergraduate distance education college plans to offer a undergraduate course in American Literature. The course is a three credit course and requires about 150 hours of study time (15 weeks at 10 hours per week). The course will be offered once a year.
Course material: the course is mainly print based. The course material is written by a consultant who is a renowned expert in the field. It consists of five study guides of about 50 pages each and one additional reader. Layout and design of the study guides and clearance of copy right will be done in-house. Together with the study guides come two 60 min tapes with samples of American literature read by a professional. The development process extends over two years and will require a third of the per annum staff-time of a course manager and 1/6 of a full time commitment of one secretarial staff.
The course is planned to be on offer for six years and is expected to attract 200 students per year. It is planned to update the course in year 3 and to present from year 4 onwards the re-developed version.
Student support: Students are supported by a tutor. The tutor will extensively comment on and mark two essay-type assignments during the course. Additionally, students may ask the tutor for support by telephone, email, or correspondence.Two 5 hour weekend seminars are offered in the 4th and 12th week.
Assessment: The student will be assessed on the basis of two essays which will be marked by the tutor.
Use the following specifications of costs for your cost-analysis:
The ingredients and their costs
| 1 |
Input |
Unit of input |
Amount of input |
Cost per unit of input |
| 2 |
Development |
|||
|
3 |
Course manager |
per annum salary |
1/3 of full-time post p.a. over two years of development |
$52000 |
| 4 | Secretarial support | per annum salary | 1/6 of full-time post p.a. over two years of development | $22600 |
| 5 | Printed material | |||
| 6 | Authoring study guides | per study guide (=50 pages) | five | $1900 |
|
|
Editiong course reader
|
per reader (=200 pages) |
one | $6500 |
|
8 |
Editing and design |
per unit of 50 pages |
nine (which includes the reader) |
$6800 |
|
9 |
Copyright clearance |
per unit of 50 pages |
nine (which includes the reader) |
$2400 |
| 10 | Cassettes |
|||
| 11 |
Professional speaker |
per 60 min tape | two | $5000 |
| 12 | Production | per 60 min tape | two | $13000 |
| 13 | Assignment | |||
|
14 |
Development of assignment |
per assignment |
two |
$105 |
| 15 |
Maintenance |
|||
|
16 |
Author |
per study guide (updating) |
three |
$850 |
|
17 |
Editing and design |
per study guide (updating) |
three |
$6800 |
| 18 | Presentation costs |
|||
|
19 |
Student support |
Cost per unit of input per student | ||
| 20 |
Marking of assignment |
per assignment |
two |
$21.00 |
|
21 |
Tutor | per hour of seminar (assumed group size=25) |
ten | $2.00 (=$50/25) |
| 22 |
Tutor expenses |
per student |
one |
$1.5 |
|
23 |
Production |
|||
|
24 |
Production of study guide |
per study guide |
five |
$1.90 |
|
25 |
Production of assignments |
per supplementary unit |
two |
$1.55 |
| 26 |
Production of course reader |
per reader |
one |
$8.00 |
|
27 |
Production of cassette | per cassette | two | $4.00 |
| 28 |
Packaging and postage |
per mailing |
three |
$7.00 |
|
29 |
Income |
|||
| 30 |
Fee |
per student |
no of students (200 per year) |
$395 |
The Task
Based on the above figures and the scenario, please, answer the following questions. Include references (not lengthy quotations) to sections of the textbook to support your argument where appropriate.
Note that you need to attach an Excel file to show your calculation. Use the Excel file from the mock assignment as a template how to arrange the data for cal´culation.
General remarks to the format of presentation
You need to upload two documents: (a) a text document, (b) an Excel spreadsheet. To both documents add your name.
(a) For the text document should use Rich Text Format (*.rtf) . It should include explicit answers to each of the above questions. Only in case of the graphs you may refer to the spreadsheet. The document should summarize all the answers in such a way that it is only necessary to refer to the spreadsheet in case of differeing calculation results.
(b) Note for the excel spreadsheet: Use the provided template for your answers; calculate using a number format of 3 digits after the decimal point; make sure that your spreadsheet could be printed out in A4 landscape format.
Use the following header on top of your essay:
[Your Name]In case you face technical problems with WebTycho, you may also send your essays as E-mail before the due date to: thomas.huelsmann@uni-oldenburg.de
Best wishes,
Thomas
Dear all,
here the model solutions for you to compare with what you have done. Note that I do not just compare figures but assess what you have done based on the reasoning expressed in your solution paper and spreadsheet.
I will post the grades until tomorrow night. I will provide each of you with some detailed feedback. Together with this model solution and the attached spreadsheet this should provide you with sufficient feedback.
Thanks for your patience. (The new assignment is already on the way!)
Kind regards
Thomas
Dear all,
The module 2, the techniques of cost-analysis is coming to an end. I am quite pleased that many of you have contributed, many clarifications were achieved in discussion to which participants contributed. When, again, I want to summarize I may not do justice to all of your contributions but I hope my summary will nevertheless be useful.
There was some confusion on terminology (it might be interesting to ask Greville to which extent accounting terminology differs). The question was aboutrevenue expenditure and if they are the same thing as expenses (Charlotte, 2.2.1). I explained Greville's use of the notion (2.2.2) according to which revenue expenditure comprises recurrent and non-recurrent (non capital) costs. Hence, expenses are a specific type of revenue expenditure but other revenue expenditure like recurrent costs would not be classified as expenses. The problem is expressed by For Sally (2.2.6) according to who "revenue expense" (expenditure) seems to be an oxymoron (revenue being something you get and expenditure something you give). As I suggested (2.2.8 ) we may have to ask Rumble how it comes to this oxymoronic terminology. There was some complaining about the diversity of terminology (according to Kathleen, she has to "to deal with five budget managers. They don't agree on break downs, (except nervous)" (2.5.1)).- Further issues were the incremental drift of in-built pay raises (Hada, 2.1) as well as the question of how to classify something like substitute teachers (Sharon 2.8.1). It was interesting to hear that working with time sheets (ABC) is more common than I thought.
Started with a volley by Charlotte (3.1) which identified important issues. How may DE save costs: by labor labor substitutions and any capital labor substitutions (or by increasing internal efficiencies by organizational improvements). We discussed the concept of cost structure (3.1.3) arguing that (re-)introducing the classroom in DE and increasing the level of communication which the teacher shifts the cost structure (i.e. the composition of total costs in fixed and variable components) back to conventional education since scale economies are likely to be lost.- Then there was a clarification on what exactly capital for labor substitution and then scale economies means (3.1.3).
There was an important discussion of what are fixed costs and what not. The
problem with professional terminologies is often that they deviate from common
sense terminology. If prices for the server fall how can be the server costs
classified as fixed? We need to see that fixed costs are defined as fixed with
respect to the activities under consideration. Prices for servers may change
in the world but as long as we do not have to buy additional servers due to
increase of activities, for us the costs remain the same. This lead to a further
point: that of delineating fixed and semivariable costs. In fact, all costs
are in principle semivariable rather than fixed. But for specific practical
purposes specific courses are fixed (e.g. the mentioned servers). As I said
the question of cost classification needs not to be treated with ontological
zeal but handled pragmatically with respect to the context.
Jennifer (4.3.1) made two important points referring to time and volume. The
first questions relates to tutorial time which affects the cost structure, since
teachers time is a variable or semivariable costs (variable if the lines of
communication are dedicated lines, semivariable if witness learning is possible).
Then she observed that the model seems to suggest as if N, the number of students
could be increased ad libitum. This indeed is not the case. Fore the model maker
the guidelines are clear: increase N reduce V then you will be competitive.
But reality may be cross grained and efforts to reduce V may interfere and finally
prove incompatible with increasing N. The TC formula may serve as a model but
we need to be aware that there is a difference between model and reality.
There was some confusion because we operate in parallel various binary classifications
on the same set: fixed/variable costs are one such distinctions, capital/recurrent
another. It is not so that a cost must be exactly one thing out of four, i.e.
either fixed or variable or capital or recurrent. It is either fixed or variable.
But the fixed cost can be a capital ore a recurrent cost. A variable cost also
can be a capital ore a recurrent cost. The same applies for a recurrent cost:
it can be fixed or variable etc. (If you are still not sure make an example
for all four options.
This main topic discussed to some extent the same issues as the preceding one. If you want to reread on semivariable costs you need to look also under Main Topic 8 "Marginal Costs". I need to thank Dave , whose insistence and close reading of Rumble (8.1) led me to develop the table 5.1 into a spreadsheet which illustrates the idea of semivarible costs and which I incorporate for the next class.
This main topic did not draw too many responses. I am, however, delighted that some of you found the spreadsheet useful. This encourages and motivates me to develop it further. It would be helpful if you could say in which direction you think the spreadsheets needed to be developed further. - Again there was a discussion which emphasized that mathematical models are different from the reality (my response to Bridgit (6.2)). What mathematically appears to be independently adjustable parameters may in fact be related. (I believe that reduce V may put a barrier to increasing N.)
Here we discussed again scalability. We need to realize that scalability is different from economies of scale (Charlotte 7.1). Also conventional teaching is scalable if there are sufficient teachers. This brings us back to cost structure and the difference of UMUC for instance to the OUUK model (Kathleen 7.3). (Then there was a further element irritating for those who undertake costing research: the fact that shelf life of courses is not always determined. Since shelf life impinges on numbers of student N is unknown and hence AC cannot be determined.) The issue of economies and diseconomies of scale was discussed. (Again an issue of model and reality: the model says: reduce number of courses; say in the MDE program if there are courses who are consistently below 15 students, drop them. Better: offer only core courses which all students need to take.) The effect will be that the program as such looses attractiveness and finally clients.
I thanked already Dave for insisting on clarifying Rumble (8.1) which led me to develop the table 5.1 into a spreadsheet. The major other issue was the discussion of if courses can be offered to different audiences at different costs. My example was possible not sufficiently close to what we discussed in terms of cost-analysis of courses. It referred to a debate in the UK if foreign students should pay full costs or marginal costs. Such different charges are well known to all of you though not related to the difference between marginal and average costs. The debate there echoed the arguments why out-of-state students have to pay more. In Britain critics pointed out that foreign students are an enormous economic asset to the country though their full economic contribution is difficult to measure. Not only they come to the country and consume and pay their rent, they return become decision makers and influence the economic orientation of the country. The case is again different in DE where you do not need to move physically.
Important was to clarify the relation of the break even point and fixed costs (Kathleen 9.9 and my response 9.3.2). I was quite pleased to see that there was much peer tutoring there. In a friendly cooperative manner (e.g. Hada, 9.3.1 and Charlotte in 9.3.3 ).
The issues catching my attention were Sharon's reservation against the commercialization
of education (10.2). Bob contributed to the same line of argument using experiences
from the health sector (10.2.4). I can share these reservations. They directly
lead to the next module when we look at the efficiency concept. Cost benefit
cost effectiveness analysis all work by measuring as much as possible in monetary
terms. This is a double edged weapon. It undermines absolute values which are
practically declared as illusions. There is a monetary value for life. Premiums
for dangerous jobs are proxies; sentences in libel suits etc. There are monetary
values for quiet and peace. We do not like to think in this way. On the other
hand at times only a monetary assessment leads to the appreciation that there
is a value at all. This applies for many ecological questions: life cycle analysis
of products makes many costs visible. There is a difference between price and
value and I think it has a numbing affect on our ability to value something
if we can do it only by way of prices (monetary values).But I would apply this
not only to education.
There was some misgivings about the arbitrariness of the calculation of economists
(you know the joke that while a mathematician would answer the question 'what
is two plus two?' saying that it is four, the economist would ask 'what do you
want it to be?') Greville has some interesting examples in this direction (p.
69) in the book. The differences are not in arithmetic but relate to cost classification
and cost attribution. Therefore it is important when you compare to compare
not just the figures but also the methods.
I would like to thank you for your contributions. I think we succeeded in clarifying important concepts and now may proceed to the next module with some confidence.
Kind regards
Thomas
Dear class members,
Module 3: the Cost-effectiveness of Distance Education is open
now.
The module will extend over about
two weeks from Monday,
03/0 to Sunday, 03/30
In the module on 'cost analysis' we have learned the tools of the trade, which we find applied in this section. The required reading for this sections are chapter 13 and chapter 14 of the textbook. These chapters may be considered as the core chapters of the book since they address the central issues of the economics of distance education, i.e. the questions of efficiency and effectiveness. If you have not read these chapters as yet, please, complete the reading soon. Only then you are able to profit fully from our 'visiting expert' Greville Rumble, the author of the text book. Greville will be your main teacher form Monday, 03/17 to Sunday, 03/23. The presence of the visiting expert is the distinctive feature of this module. Please, prepare your questions (including those which you feel were not yet satisfactorily answered). Find Greville's bio among the faculty biographies (http://info.umuc.edu/mde/home.htm then click on Faculty/staff on the left menu). In addition you will find some further information in my 'Welcome Address to Greville'. - Let us first see how this module connects with what we have done so far:
In the introduction we have looked at the expansion of education within the last fifty years. We have examined the reasons for this expansion, some of them connected to specific historical circumstances (like decolonization or cold war competition). Other reasons are conceptualized in the Human Capital Theory. Two types of 'returns to educational investment' have been referred to: first, the private returns to education, reflecting the willingness of individuals to forgo immediate satisfaction and to invest in themselves (or their children); second, the social returns to education, reflecting the expectation that there is a connection between economic growth and investment in education.
While there are good reasons to consider education a good investment, returns to educational investment have been found not so directly linked to the coffers of the ministries of education to make soaring costs no problem any more. We have seen that the mass demand for education poses serious problems. In the end of the introduction we had suggested you to revisit the theory of distance education as the most industrialized form of education in order to understand why DE could be considered as possibly contributing to the solution of the problem of exploding demand and limited resources. Peters theory simply points out that DE seemed to exhibit features characteristic for industrial mass production which could be considered as precondition to mass consumption.
At that point we left the introduction and shifted our focus to the more technical details of cost-analysis. However, the Total Cost Equation and Average Cost Equation can be considered as a economists model of DE as the most 'industrial mode of teaching and learning'. The two equations can be considered as the rationale for the expectation that DE may contribute to soften the conflict between educational cost and demand. The mathematical model is nothing but a concise formulation of the economies of scale which is at the heart of the success of the industrial model. The mathematical model points the direction how it would be possible to break the lockstep linear linkage between exploding demand and soaring costs.
We can even identify two management guidelines on the way: one is, "keep unit costs low", the other "exhaust economies of scale".
However, we already realized that the mathematical model is nothing but a model. While it is true that low unit costs plus high level of enrollment leads theoretically to low average costs, in practice this might backfire: low unit costs may mean little support for students, failing students and eroding attractiveness of the courses. The parameters N (number of students) and V (aggregate unit costs or aggregate variable cost per student) are not decided altogether by the institution. This is one of the reasons why a purely mathematical analysis will not be a substitute for looking at the empirical evidence.
This is what we begin in this module, looking at the evidence for the hypothesis that DE offers a cost-effective alternative of educational provision. In order to do this we need to clarify our conceptual framework. Key notions including efficiency, effectiveness and cost-effectiveness need to be considered. We need to ask:
These questions are related to the topics which structure this module:
Efficiency and effectiveness
What appears as a 'twin notion' will turn out to be quite different. Efficiency
is about a relationship between inputs and outputs (or outcomes), whereas effectiveness
is a measure telling you to which degree you have achieved your objectives.
Both notions pose complex questions of measurement.
Aspects of the two notions merge into the key concept of 'cost-effectiveness'.
The methodology of cost-effectiveness analysis
A methodology of cost-effectiveness analysis has been established in DE long
since. It links the conceptual framework of efficiency and effectiveness to procedural
applications of the techniques of cost-analysis.
Read the introductions and post your comments or request for clarification as responses to main topics two and three, respectively. At the same time continue with reading the text book. Especially, if you want to revisit questions on cost-analysis, you may want to put these questions to Greville. With regard to chapters 13 and 14 you may want to ask further questions. Put them to main topics five and six. Greville will answer the questions parallel to the seminar discussion in main topic eight. I included this time a further main topic (main topic seven) which invites you to put any question concerning any of the articles by Greville which are on our reading list.
The seminar discussion on the "Competitive vulnerability of distance teaching universities" will look at the issue of comparative cost-effectiveness within distance education itself. In 1992 Greville wrote a much discussed paper looking at the 'comparative vulnerability of distance teaching universities'. Dedicated distance education universities have by then come under pressure because the competition of traditional universities developing into 'dual mode institutions'. You should read the respective papers and be ready to engage in the discussion with Greville.
Kind regards
Thomas
Dear all,
Let me give you a little introduction into the conceptual framework of efficiency.
It has been noted that the new discipline of economics of education
translated a number of analytical concepts which originated in the context of
manufacturing to the context of education. They include the concepts of efficiency,
effectiveness and cost-effectiveness.
The distinction between efficiency and effectiveness is succinctly expresses
by Drucker:
"Efficiency is concerned with doing things right; effectiveness is doing
the right things." ( Drucker, 1974, p.11)
There are essentially two aspects of efficiency. One is often referred to as internal efficiency. If an organization, to use the metaphor of a machine, "runs smoothly", without much of internal friction, it runs efficiently. The other aspect is external efficiency: this includes the question if your output is of use to anyone (e.g. the society, the employer, other consumers).
According to Mace (1992, p.4; citing Psacharopoulos) "The external efficiency of educational investment is usually judged by two criteria:
The quotation refers to a number of issues discussed in the first module in relation with 'human capital theory'. In principle, external efficiency asks if the produced output conforms to externally set requirements. (Note, sometimes a distinction is made between outputs and outcomes. The term output is used "to classify immediate products of the system, such as graduation results and numbers of graduates; these are differentiated from ... outcome effects, which measure the longer-term results of schooling on 'the ability of people to be socially and economically productive'." (Thomas, 1990, p.48) However, the distinction is not universally applied.) Note that the concept of external efficency is related to the concept of effectiveness (cf. the definition of effectiveness above by Drucker).
While in the module 1 we looked to some extent on aspects of external efficiency, cost-analysis allows us to analyse aspects of internal efficiency.
Internal efficiency therefore is associated with internal processes. The efficiency of a process is measured in terms of its inputs and outputs relationship. A process X is said to be more efficient than a process Y if the input/output ratio of X is smaller than that of Y. This input/output model has been developed for manufacturing and is often referred to as production efficiency. Note that inputs do not merely refer to raw material but include all ingredients of the production process, e.g. equipment and personnel. One may regard the process as being defined as a 'configuration of inputs'. Inputs and outputs are regarded as being related in a causal relationship. The configuration of inputs 'cause' their transformation into outputs.
Often the outputs are measured in 'units produced' and the inputs are measured in monetary terms. There are two ways of being efficient:
Rumble defines the term cost-efficiency by saying "a system is cost efficient
if, relative to another system, it output cost less per unit if input." (Rumble
1997, p. 20) This means cost-efficiency is equivalent to production efficiency
provided the input parameter is measured in monetary terms.
The efficiency of different processes can be compared by measuring inputs and
outputs only and treating the process itself as a sort of 'black box'. However,
if efficiency is lacking, one might be tempted to open the box and modify the
some of the inputs or the way they are configured. This leads to the study of
production functions. Which configuration of inputs yields the highest
output?
Effectiveness is related to objectives. "An activity is effective when it achieves its goals." According to Rumble (1997, p.161) "effectiveness is the ratio of the actual outcome to the possible ideal outcome". The difference is that in the first case effectiveness is treated as category variable ('the goal is achieved or not') while in the second case effectiveness is a scale variable: there are degrees of effectiveness (e.g. an effectiveness score of 4 out of 20).
There are two ways to relate effectiveness and efficiency:
In the first case it is possible to be both, effective and efficient, or neither effective nor efficient, or effective but not efficient, or finally efficient but not effective. The moot point is the last one. Is it possible to be efficient while not achieving one's goal? Is it possible to do the wrong things right? This is in fact a matter of definition. It is certainly possible to distinguish between the inward looking mindset, which focuses on reducing the inner friction of the production process, and the outward looking mindset, which sees to it that the product conform with externally set standards or demands. The production manager might have organized the process of production to highest standards of technical efficiency. If the design of the car does not conform to the preferences of the consumer, the objective of the production process (to sell many cars) is not achieved. In this sense the process could be regarded as efficient without being effective.
Often, however, it is assumed that (ii) holds and that effectiveness is being a necessary condition for being efficient. In this case "it is possible to be effective without being efficient but it is not possible to be efficient without being effective." (Thomas, 1990, p. 49) In practice there is little reason to expect confusion.
What is important to see, is the following: efficiency is associated with a 'ratio' of inputs and outputs. This is not true for effectiveness which measures outputs against a set of evaluative criteria. (If at all a ratio is involved is the ration to which the objects are achieved but not an 'input /output ratio.) I want to draw your attention to the fact that what seems to be a twin notion (efficiency and effectiveness) are two fundamentally different concepts.
Regards
Thomas
_____________________________________
References:
-- Drucker, P.F. (1974) The effective executive London: Heinemann.
-- Mace, J. (1992). Economics of education I. London: University of London
External Programme.
-- Mace, J. (1996). Economics of education II. London: University of
London External Programme.
-- Thomas, H. (1990). Education, costs and performance: a cost-effectineness
analysis. London: Cassell.
-- Levin, H. M. (1995). Cost-effectiveness analysis. In M. Carnoy (Ed.), International
encyclopedia of economics of education (pp. 381-386). Oxford: Pergamon.
Dear all,
This topic introduces you into the method of cost-effectiveness analysis, CEA. It defines the notion of cost-effectiveness, describes the method and summarieses the possible cases an analyst may have to deal with.
Cost-effectiveness belongs to the family of efficiency concepts (where input/output ratios are involved). It can be regarded as an adaptation of the notion of cost-efficiency for contexts where the outcome is not (exclusively) defined as quantities (i.e. numbers of units produced) but also in terms of quality. This is the case in education. To assess the quality of some output often poses major problems of measurement. Since such qualitative aspects cannot be measured directly, one often has to agree upon so called 'performance indicators'. For instance one may regard students as production outputs of the university. An output measure, which combines the quantitative and qualitative aspects, would be the 'number of graduates'. Hence, similar to efficiency, cost-effectiveness is a process measure. Cost-efficiency is expressed as the ratio of the costs of inputs of a production process to its outputs, cost-effectiveness as the ratio of the costs of inputs to the more qualitative outcomes or effects of an educational strategy. The analogy between cost-efficiency and cost-effectiveness is also reflected in the following quotations. According to Levin (1995, pp. 381-386) there are two ways of increasing one's cost-effectiveness:
The analogy is indeed clear: (i) has its equivalent in technical efficiency and (ii) relates in similar ways to economic- or price-efficiency.
Cost-effectiveness analysis is intended as a management method to guide investment choices between alternative strategies. Levin reports (ibid. p.382):
"Cost-effectiveness analysis was developed in the 1950s by the United States Department of Defense as a device for adjudicating among the demands of the various branches of the armed services for increasingly costly weapon systems with different levels of performance and overlapping missions (Hitch and McKean 1960). By the 1960s it has become widely used as a tool for analyzing the efficiency of alternative government programs outside of the military, although its application to educational decisions has been much slower to develop. Indeed, in the early 1990s the use of the tool in considering educational resource allocation is restricted largely to the United States and has not emerged as a decision making approach to resource allocation in other countries."
That the transition from a management tool, used in a military context, to a tool suited to the requirement of educational management takes time, is understandable. A management tool must be fairly flexible and must not be too dependent on context parameters and it must be ex ante, i.e. costs as well as effects should be known beforehand. However, educational parameters are notoriously difficult to disentangle from their contexts and, while it might be easy to estimate the effects of a weapon on the basis of its technical specification only, this is unlikely in the case of education. It may be noteworthy that cost-effectiveness analysis in education is generally applied in a context of research rather than a management context. Levin describes the different steps of a cost-effectiveness analysis (1996, pp.382-386). It consists in
Cost-effectiveness has become a fashionable term to use. The complex requirements it poses in terms of measurability are often ignored.
Hülsmann (2000, p. 25) uses following diagram displays the possible cases a cost-effectiveness ratio can take and explains: "When comparing two strategies according to their cost-effectiveness, we have to compare numerators and denominators of the respective cost-effectiveness ratios. We can distinguish four cases in which we compare approach A - say the use of a non-conventional teaching technology - with approach B - following conventional methods.The manager can easily reject the use of approach A in case (2), with increased costs that yield no improvement and adopt approach A in case (3) where there are improvements without more expenditure. Cost effectiveness will not, however, help us in cases (1) and (4), and the manager will need to look elsewhere for guidance."
Observe that in cases of equal effectiveness, cost-effectiveness can be considered as collapsing to cost-analysis. This is part of the reasons why it is convenient in the case of comparing the cost-effectiveness of media to assume 'media equivalency', i.e. that by and large the effectiveness of the media is the same. In this case we can judge cost-effectiveness by merely comparing costs of inputs..
Regards
Thomas
_____________________________________
References:
-- Levin, H. M. (1995). Cost-effectiveness analysis. In M. Carnoy (Ed.), International
encyclopedia of economics of education (pp. 381-386). Oxford: Pergamon.
-- Hülsmann, T. (2000). The costs of open learning: a handbook.
Oldenburg: BIS.
Dear all,
Chapter 13 is about cost-efficiency. Greville defines the concept and then moves on to analyze the cost-efficiency of the Open University of the UK. He bases his analysis among others sources on the seminal study by Laidlaw & Layard, (1974). You may skip through this study and include your respective questions here.
The section on the OU not only examines the issue of cost-effectiveness, it is especially important for understanding the methodology of analyzing cost-efficiency at institutional level. In section 13.3 you find a summary of what has evolved as a common methodology for economic studies of distance education. Table 13.3 summarizes the results of research conducted according to this methodology. Though slightly dated, it can be regarded as a summative account for the evidence for the cost-efficiency of DE institutions.
Kind regards
Thomas
_____________________________________
References:
-- Laidlaw, B., and Layard, R. (1974). Traditional versus Open University teaching
method: a cost comparison. Higher Education, 3, 439-468.
Dear all,
Chapter 14 is about cost-effectiveness. Again Greville sets out to define the notion of effectiveness and its measurement. I want to draw your attention to section 14.3 looking at the relative effectiveness of technologies. Do you think it is possible to arrive at clear conclusions when comparing two technologies? This question will be reconsidered in the next module but it is implicitly raised already here. You may discuss it with Greville.
Kind regards
Thomas
Dear all,
Greville took the initiative before I even could intorduce him. Well, I introduced Greville already shortly in the course introduction but I want to do it again in this main topic.
Those who have read Greville's biography saw that he is a truly international
figure:"born in Lima and schooled in Ecuador, Switzerland and England"
the biographical note starts.
His biography also proves him not to be a narrow specialist but someone who
combines with his international and multicultural experiences the capacity of
taking the broader historical perspective: in 1968 he graduated at the University
of Kent at Canterbury in the United Kingdom, with a Bachelor's degree in History.
In 1970 he was awarded a Master's degree from the same University following
a one year research studentship during which he studied de facto theories of
government in seventeenth century England.
But the personality we want to profit from most during this coming week is the professional in distance education. Since 1970 he worked for the then newly founded British Open University and gained hands-on experience in managing important departments of the open university: " Greville now has 30 years experience in distance education, largely in an administrative capacity. He was twice, first in the mid-1970s, and then in the late-1980s, head of the Open University's corporate planning office. During the 1990s he was for eight years director of a regional office providing services to students. In 1999 he was appointed to a personal chair as Professor of Distance Education Management at the Open University. In 1998 he became Editor of the journal Open Learning.
But besides being an administrator he remained an academic and researcher in the field. I select only few of his long lists of contributions which are regarded as seminal works within the DE research community: The most recent book The costs and economics of open and distance education (1997) is a core text for this course. A small succinct management guide was published by the IIEP: The management of distance education (Paris, UNESCO: International Institute for Educational Planning, 1992), together with João Oliveira, Vocational education at a distance (London, Kogan Page, 1992) together with Keith Harry, The distance teaching universities (London, Croom Helm, 1982); and together with Tony Kaye, Distance teaching for higher and adult education (London, Croom Helm, 1981).
But Greville reflects not just the British Open University perspective. His work as a faculty member or consultant in distance education spans a wide range. I quote from the bio: "Greville has extensive international experience as a consultant in the planning, management, costs and economics of distance education. In the late 1970s he worked extensively Universidad Nacional Abierta in Venezuela, and at the Universidad Estatal a Distancia in Costa Rica where, in 1980-81, he was an advisor in the Planning Vicerectorate, having taken leave of absence from the Open University. In the early 1990s he undertook extended consultancies at the Indira Gandhi National Open University, working on the curriculum transformation of IGNOU, and in the mid-1990s he was Chief Technical Advisor at the Bangladesh Open University. Overall he has worked on distance education projects in over 30 countries."
It is obvious that we have here an expert visiting the classroom, we all can profit from. We can do so by asking questions and participating in the discussion. There are two ways you can profit from the presence of Greville: (i) by asking questions with respect to the book; (ii) by participating in the 'vulnerability' debate.
(i) Asking questions:
The questions which may concern remaining problems of cost analysis as well
as any other question relating to the textbook should be posted under main
topic 4 and 5.
(ii) Participating in the 'vulnerability' debate:
The conference focusses on discussing Greville's seminal article on "The
Comparative Vulnerability of Distance Teaching Universities". Comments,
questions and contributions to this article post to main topic 7.
I look forward to an interesting conference and welcome Greville as a visiting expert.
Kind regards
Thomas
Dear all,
one major assignment for this module was reading about the discussion of what Greville termed the vulnerability of DTUs (Distance Teaching Universities). The debate is not new but the issue is still an interesting one and much can be learned about it about costs and costing.
A number of observations are made by Greville in the introduction to his particle: "Given the enthusiasm and interest which distance teaching universities (DTUs) have aroused, it is perhaps surprising that there are relatively few of them." Greville reports that some countries like Australia and Sweden did opt against this approach preferring more decentralized approaches to distance learning.
Under this main topic I invite you to discuss this article. I will give the debate a little twist, by including a recent article by Otto Peters in the list of suggested readings. The main thrust of the article is not an economic one. It rather describes Otto Peters vision of the new university which makes use of the new media and provides the appropriate environment for the autonomous learner. I suggest to look at this article because it includes an annex which is intended to demonstrate that DTUs (the example being the German FernUniversität) are being better positioned to develop into this type of university. Peters' article includes a number of arguments underscoring the section 'The strengths of distance teaching universities' in the Vulnerability article.
I want to turn your attention to a number of points which you profitably can discuss with Greville. First of all, the role of how the number of courses affect the overall cost efficiency of DTUs. The argument is also included in Laidlaw and Layard's article included in the readings. The more courses you offer the more you fragment enrollment therefore eroding scale economies. (Have a look at the formulas 128 and 129 in the textbook.) There might be on the other side a danger of reducing the spectrum of courses offered: if the offer of the institution is too limited then it might not attract the number of students necessary to justify the economies of scales. This seems to be a typical catch 22: in order to attract sufficient students you need to offer a sufficient wide range of courses. However, the very range which is a magnet to attract high numbers is at the same time eroding the economies of scale by fragmenting the high number into too many courses. Hence the fact that traditional universities already have an established structure to cater for all sorts of disciplines puts them into a better position.
One interesting piece of argument in the paper I found the implicit reference to credentialism. There is a school of thought which argues that education is not so much about conveying competencies in various field than a mechanism for screening. Therefore the importance of a degree. Therefore the importance of the name and prestige of the institution which graduates you. Students might put up with lesser quality instruction if only the name of the institution lends some credence to your degree. Given that more often than not the traditional universities have a higher prestige than DTUs students might flock to traditional institutions which have developed into DMUs, especially if they will receive the same certificate.
Even if DTUs have a strong position with respect to technological competence, the cumulative effect of traditional institutions going dual mode, and hence taking each of them only small proportion of the market, might erode the almost captive market of the DTUs. Being dependent on scale for spreading their high fixed costs over large numbers of students, this may weaken the DTUs advantage in comparative cost-effectiveness. This would be a pity, since it could mean that though taken alone the DTU would outperform all its DMU competitors but fall prey to the piranha attack of many DMUs.
A further set of questions could address the issue of cost attribution. I found this an intriguing exercise. We have somewhat neglected the issue of overheads and the issue of cost attribution. We could take it up here. This is a problem which plagues institutional researchers: if the method of cost apportioning is so variable it seems to introduce a sort of postmodern arbitrariness into costing. Especially, costing specific operations of an institution seems to be an impossible exercise since the underlying methods of apportioning costs are not spelt out clearly. Are there standards?
The vulnerability article saw dual mode institutions competing
with DTUs. It sees the pressure coming from traditional universities which, since
they also cannot ignore the new technologies, open up an out-of-campus wing. This
is a recognition that traditional universities change under the pressure of (i)
the new technology and (ii) the policies demanding increasing 'internal efficiency'
savings. Even universities which do not develop into dual mode institutions may
be more efficient today than when Wagner and Laidlaw & Layard published their
comparative research. (cf. Rumble, 2003).
But it seems that also DTUs are affected by the new technologies. learning platforms
allowing asynchronous computer mediated become standards. This means that there
is a shift from individual study to group learning and, related to that, an increased
demand for communication with the instructor.
I hope you will come forward with lots of questions.
Regards
Thomas
_____________________________________
References:
-- Peters, O. (2001 February).
Learning with new media in distance education. Fernuniversität-Gesamthochschule
in Hagen. Fachbereich Erziehungs-, Sozial- und Geisteswissenschaft, Institut
für Erziehungswissenschaft und Bildungsforschung. Retrieved 06,17, 2002,
from the World Wide Web: http://www.uni-oldenburg.de/zef/cde/found/lnm.htm
-- Rumble, G. (1992). The competitive vulnerability of distance teaching universities.
Open Learning, 7(2), 31-45.
-- Rumble, G. (1994). The competitive vulnerability of distance teaching universities:
a Reply. Open Learning, 9 (3), 47-49.
-- Rumble, G. (2003). Critical issues on the costs and economics of distance
education (Vol. 7). Oldenburg: bis.
-- White, V. (1992). Responses to Greville Rumble's article 'The competitive
vulnerability of distance teaching universities'. Open Learning, 7( 3),
59-60.
Dear Greville and all,
The conference week with Greville came to an end today. I want to say some words of thanks.
I think this was for both parties a substantial experience. For Greville because this time the class was much bigger and quite active. It is quite another kettle of fish to discuss with ten rather than with thirty! But Greville seems to enjoy it concluding from the relentles flow of comments. For the class I believe it is quite sure to say that you have not quite often made such an experience.
And I must also thank Greville for quite personal reasons. Not all 'visiting experts' keep the instructor 'the back free' (can you say that?) like Greville. The first assignment keeps me always especially busy because I have trace mistakes, recalculate spreadsheets with your different assumptions and so on.
My message of thanks became a bit like a ritual (for Greville not so for the class). But I found the citation from a participant of the first course quite to the point:
"Here, Here; My head is still spinning. Drinking from the fire hose is the only way to describe the experience. If Greville remains a part of our UMUC experience I can see that many of us will be tapping his keg of knowledge often. Well done and thank you."
The comment turned out to be generic and may describe your experience as well. I believe Greville lives up to the highest expectations we had in the role of the visiting expert. Friendly, responsive, interesting, and as the name says, expert.
This first time, I could not be sure that Greville would take up the role of the visiting a next time. I then remembered a Nebele saying which reflected my hopes. It says: "Siabonga lingadinwa nakusasa." "Thank you; do it again tomorrow" (meaning in my case next term). To may amazement I begin to discover that the expression may in reality be a spell..:->
Thanks Greville, but also thanks to the others who asked the questions
Thomas
(Ndebele are a southern African nation.)
Dear all,
I discovered that I am a day behind schedule for posting assignment #2. It is demotivating to start the second assignment before having a feedback for the first. I promise now to complete until tomorrow (Tuesday, 03/25, night). You will be able to estimate what you have got by comparing with the solution template I post together with this message. Note that I do not just compare figures but include an assessment of your calculation methods.
In spite of the delay, I will post the assignment now. Basically you will be
offered the choice to discuss the vulnerability article on the one side and
or the cost-effectiveness based of the UKOU based on the respective section
in Rumble 1995. For the second choice, I recommend the additional reading
Laidlaw, B., & Layard, R. (1974). Traditional versus Open University teaching
method: A cost comparison. Higher Education,(3), 439-468.
(See Course Content /Readings per module for the link to the article). In addition
you may read my intros on efficiency and cost-effectiveness analysis. You are
invited to ask and comment.
I promise to complete the grading before posting the new assignment.
Kind regards
Thomas
Dear Class Members,
you are asked to write an essay of 800 words (+ or - 100 words)
on ONE of the
following three topics:
Do not use lengthy quotations but include short references. Do not paraphrase argument but make your own considered case referring to the respective sections.
For reasons of consistency we suggest the following header on top of your essay:
[Your Name]In case you face technical problems with WebTycho or any questions regarding the assignment, you may also send your essays as E-mail before Midnight Monday, 03/31 (EDT) to: thomas.huelsmann@.uni-oldenburg.de
Best wishes,
Thomas
Dear all,
better late than never. Most of you discussed the Vulnerability of DTUs. Below you find my marking scheme. Generally I highlighted in the list of the relevant items the items you did consider in your discussion.
| Presentation |
Here I expected a clear structure and properly APA style
quoted references. |
| Relevant items: |
There is quite a list. Let me give you some keywords:
|
| Relations: | Items should not discussed in isolation but
should explore the implications and linkages with other items: e.g. it may
well be true that you can include off-campus students at marginal costs
if you use cheap methods of course material development and do not increase
student support services. This may lead to a loss of quality and/or exploitation
of staff. In addition I expected clear references to the respective cost-structures. |
| Independent judgment: | A number of you took a clear position possibly diverging from the Rumble's conclusion. This is, if well argued, a positive point. |
| Critical points: |
Here I emphasized what I had to criticize, including factual errors and misinterpretations. |
| Summary / grade |
Generally, the essay was quite well done. However, this does not imply that it is all As.
Kind regards
Thomas
Dear all,
Sorry, that it takes me so long to write my summary. But it is a substantial read what you and Greville produced during his conference, and given that most of you do not follow any rules with respect to headers, it is cumbersome to reconstruct the discussion in such a way that I can identify the thread numbers. That's all I have to complain about. Otherwise: I found it an very interesting read, not only because Greville generally comes up with something new, but also because of your questions which showed that you are already deeply involved in the field.
I exclude a comment on the Vulnerability thread which I may
include in my comments on the assignment #2.
Here there was a discussion about the relation of the different concepts. The discussion led to explore the relation between cost-efficiency of a program, program effectiveness and to which extent a program meets market demands. I restate the concepts here again and develop a matrix bringing the concepts of efficiency (measured by how much a program costs), effectiveness (measured by pass rates) and external efficiency (measured by labor market placement).
Efficiency, effectiveness and cost-effectiveness
Efficiency is an input/output notion. You increase efficiency if for less input you get more output.
Cost-efficiency is efficiency where inputs are quantified in monetary terms.
Cost-effectiveness is also an input/output notion where inputs are in monetary terms while outputs can be evaluated by all sorts of indicators given they are measurable (quantifiable) in some sense. Cost-effectiveness therefore belongs to the family of efficiency concepts.
The difference of cost-efficiency and cost-effectiveness is not always clear. Generally we speak of cost-efficiency if we have clear measurable outcomes. In a factory where products are physically countable you would speak of cost-efficiency. However, in education if you measure effectiveness by performance in a test you would speak of cost-effectiveness. Rumble speaks of cost-efficiency when it comes to measure cost per graduate. I would tend to see pass rate as an effectiveness measure and would prefer the concept cost-effectiveness. (Mind what Greville said (Greville in thread 3.2.1), in case of difference follow me since I am grading .;->
Effectiveness is different. It evaluates not an output input ratio but to which degree an objective has been achieved (disregarding the inputs or costs).
| Note: While cost-effectiveness belongs to the family of efficiency concepts, effectiveness does not |
External/internal efficiency
The difference is based on the distinction of a system and the system environment. The system here is the education system (or, an education institution) which is embedded in the labor market. Internal efficiency is efficiency evaluating the system as such (is there friction in the system?).
External efficiency evaluates the system with respect to the labor market. To which extent is the output of the education system productively absorbed by the labor market.
| Note: You can be internally efficient without being externally efficient. |
The Matrix
Greville suggested a matrix relating effectiveness to efficiency (Greville, 3.2.3). I pick up the idea here to relate internal efficiency (i.e. cost-efficiency) to effectiveness and external efficiency in a matrix.. I followed up this idea and came forward with the below matrix. For illustration purposes I chose simple performance indicators to measure the three parameters:
- Internal efficiency is high if cost per output is low
- Effectiveness is high if pass rate in centrally set exams is high
- External efficiency is high if placement rate in the labor market is high
| Internal efficiency |
Effectiveness |
External efficiency |
|||
| 1 | high | high | high | Low cost, high pass rate, high labor market placement | Very good |
| 2 | high | high | low | Low cost, high pass rate, low labor market placement | Long term problem (they "do not the right things though they do things right") |
| 3 | high | low | high | Low cost, low pass rate, high labor market placement | Short term problem (customers wont like it) |
| 4 | low | high | high | High cost, high pass rate, high labor market placement | Niche market for the richer clients |
| 5 | high | low | low | Low cost, low pass rate, low labor market placement | Combines long and short term problems of 2 and 3. |
| 6 | low | high | low | high cost, high pass rate, low labor market placement | Long term problem combined with high costs. Normally if costs are high clients look for ROI and wont like it. |
| 7 | low | low | high | high cost, low pass rate, high labor market placement | Niche market for the intelligent and rich clients |
| 8 | low | low | low | High costs, low pass rate, low labor market placement | Very bad |
Cost-effectiveness is generally used as an (internal) efficiency measure where costs per outcomes (e.g. pass rates) is low. This is the case in 1 and 2 in the matrix. 2 is the case for doing things right but doing the wrong things (in terms of external efficiency). Here the institution is cost-effective but not in the sense of external efficiency.
The question can an institution be efficient but not effective needs some interpretation. The notion of efficiency needs a measure of output. If the measure of output is graduates it is unlikely that an institution can be efficient but not at all effective. In Drucker's terminology of doing things right but not doing the right things effectiveness (doing the right thing) is generally interpreted as external efficiency (rate to which output of the education system is productively absorbed in the labor market).
There is a problem of visibility: parents, students will soon realize what the pass rate is. Labor market placement is often less visible and requires long term projections. You may hear that there are many open places for media designers. But this information might produce an effect that when you finally compete your studies you find yourself competing with many so that labor market placement of this discipline is eroded.
Institutions will have to watch directly their pass rates. In the UK you have league tables publishing school performance. If they offer specialized/vocational training they need to watch closely labor market developments.
Transfer credits
There was an interesting discussion (started by Suzanne 4.1) on credit transfer. The issue: If you measure performance by numbers of degrees given (and even funding is distributed on the basis of this) then to accept credits of other institutions would be a good idea since without costs you boost your performance. If you in addition can make people pay for credit transfer being accepted the institution profits twofold: by being able to count a degree towards which it might have contributed only marginally leading to a public money revenue stream and by squeezing the individual student who pays for being allowed to bring his/her credits in leading to a revenue stream of private money (Greville, 4.1.2).
This leads to the general question which is quite fundamental to comparative cost-effectiveness research: how to assure that we compare like with like? Greville illustrated the problem by describing a OUUK BA:
"so people could graduate provided they satisfied the credit requirements (360 credit points for a BA unclassified, 480 for a BA classified with honours) ... so you could take say Renaissance History, Pure Maths 3, French 1, Modernism and Modernity (sociology), Igneous Rocks, etc. etc .. and get a degree." (Greville, 4.1.4)
I missed to ask him how he would evaluate this from a labor market perspective! Compare an traditional engineer with the BA creature the OU has produced? Is there the same level of external efficiency (labor market placement)? Do we know something about that?
Efficiency gains
Efficiency gains are measured by Rumble as the difference between average costs (Greville, 4.2.1). The DE cost structure allows to have economies of scale that means that average costs fall when numbers increase. Greville gives an example of AC(1) and AC(10000): the efficiency gain achieved if numbers are moved from one up to 10000 is equal to the difference AC(i)-AC(10000).
(Small Hitch in Greville's posting 4.3.2 includes a reference to Human capital theory. The name here should be Schultz, not Schwartz.)
Time compression
Charlotte asked a question on the compression of learning time due technologies. She expressed her surprise ('miraculously compressed' Charlotte, 4.). This is an interesting issue we come back to later. I share Charlotte's skepticism here though the points of Greville are to be taken into account: training being related more to skill performance than conceptual understanding ( Greville says: training being 'more instrumental' (Greville, 4.4.1)) may explain part of the time compression. In this case it is not the technology but the more focussed educational objectives which explain compressed training time. In the same posting Greville identifies an important difference in educational technologies: to which respect they are interactive. Greville refers to Roxanne Hiltz who argued that technology gives students more access to teachers and obviously Greville asks the question how this time is to be provided. (Brings us back to the question of the costs of interactivity cf. Ainsworth which drew angry comments of Charlotte before.)
ROI and EVA
A very important posting is Greville's 4.5.2 on ROI. Where Greville introduced the concepts of flexible and committed costs, ABC and different profit measures, ROI and EVA. Especially I found his analysis of the weakness of ROI worth remembering: ROI, as a ratio can be increased by increasing the numerator (earning more profits with existing assets) or by decreasing the denominator (shrinking the investment base). The latter option while increasing ROI in short term may be on the long run detrimental for the company.
Training
There were some comments relating to the world of training. Charlotte (4.6.4) reported of the requirement of "90% success guaranteed". This led to an interesting debate on assessment. Greville stated, as we all know, that in education we normally use the normal distribution to grade. This leads to the perception that some have to fail. Assessment identifies ability and some run quicker some run slower. In the training world there is more common what they call competency based assessment. If you master the skill get your A. If all master it all get the A. The difference shows that education is also a screening device while training should not rank the talent of people but that you know what you need to know for a certain job.
In another post (4.6.3) Greville discussed the cost drivers of training (cost per training hour). He identified (a) delivering the training, (b) traveling accommodation; (c) opportunity costs of lost productivity. Distance education can help to save in (b). With respect to (c) he said in a response to Bob who reported that students had to do the training in their own time: "you are just doing what comes naturally to the cost conscious and exploitative employers :-) !!"
Distance education and blended learning
Greville's posting 4.10.3 is important for the distinction between distance education and conventional education. Greville sees the distinction as largely outdated. He sees it as being rooted in the historical context of the seventies and eighties: (i) then differences in use of technology were quite obvious; they are less so today; (ii) distance educators being what they were wanted to define and establish a distinct profile (theory of distance education including a pedagogy) needed for constituting a subsystem of education (insistence of DE being sui generis as Peters put it); (iii) coping with numbers (access). Greville sees these 'separatist tendencies' as finally not very helpful. - There is astonishing much agreement to Greville's 'heresy' given that you all take a MDE program and might have some stakes in a distinct profile of the field. (Sharon 4.10.8). (In (4.10.12) Greville outs himself as identified (e.g. by Holmberg) heretic.) Lealean (4.10.14) comes forward with 'blended learning' as the new buzzword. (In my view conventional education is already blended learning. In a normal school day instruction is quite evenly slit among using textbooks and direct instruction by a teacher; in HE libraries represent essential elements complementing lectures and seminars. According to Lealean the 'blended' refers exclusively to online instruction? Why?
Wintel conspiracy
Interesting post by Greville (4.11.1). He takes on the argument that technology becomes cheoper and cheaper. Andressen, the creator of Netscape, referred to the same thing as Wintel conspiracy. Intel produces cheaper and more powerful chips but instead of lowering prices the sophistication Windows adds counteracts the falling chip prices.
An interesting posting by Greville (responding to Hada 5.1) distinguishing different types of demand satisfied demand, frustrated demand and latent demand.
Two dimensions of technology costs
Charlotte 5.1.10 is still dissatisfied with Greville's insistence that technology comes at a high price. She identifies a number of points but to some extent seems to miss the important point that there is a capital cost dimension and a labor cost dimension (cf. the slide of Greville's power point presentation). Interactive technology tend to increase labor costs! I would not have chosen the examples in the same way Greville does, but I totally agree that technologies have these two dimensions. This in turn affects their cost structure.)
| Costs |
Capital
|
|||
| Low | Medium | High | ||
| Labor | Low |
|
|
|
| Medium |
|
|
||
| High |
|
|
|
|
The labor dimension was referred to earlier by Greville (4.11.1) in a different context. Labor costs in developing countries are local costs. (What you have to pay to a teacher depends partly on local food and housing prices rather than on comparative salaries in the US or Japan). What you have to pay for a computer are global costs. There is a world market price larely oriented on the price charged in the developed world. Francois Orivel argues that because of this difference it will take quite some time before technology can displace the teacher in the developing world.
Standardization
There was a discussion of comparing like with like as a precondition of cost-effectiveness comparison. Greville elsewhere provided this example how a OUUK degree can be composed and defends the openness of the OUUK. Greville responding to Jennifer in (5.5.3): "I just fundamentally disagree that they have to be the same". This is an interesting plead for variety. As an aside: we have sometimes students who want to enroll at the OU and are counseled at the Center here. I once observed that a student once she heard that entrance was open was quite hesitating to enroll. The tendency for those having A-level equivalents is that they do not want to believe that differences in entrance qualifications can be ironed out leading to the parity of esteem on the labor market they want (even you assure them about the high level of acceptance of OUUK degrees in the labor market).
In fact Momoe (5.4.1) correctly made the observation that there is an creaming-off effect by brand name institutions leading to a virtuous circle in terms of performance: the better the 'quality' of students coming in the less it is the institution who need to 'add the value'. British teachers, confronted with the government's plan to shame low performing schools in uppen their quality by publishing 'league tables', argued: 'if league tables then value added league tables' which might discover that some schools with less good outcomes add more value as the high performing institutions.
Momoe in 5.4.2 argued that DE students are more likely to become autonomous thinkers (Charlotte in 5.4.2 agrees) while Greville is less committed: Yes, potential employers admire a number of characteristics of students who did their degree by DE (e.g. motivation, perseverance, etc.) but Greville does not include autonomous thinking!
Media equivalency
Bob Welton (5.6) brought up the issue of 'media equivalency'. We will discuss this in the next module. It is related to the difficult issue of cost-effectiveness comparisons between technologies. Greville supports the theory by referring to the 'no significant difference research'. I tend to agree but basically because I believe that the media characteristics as such 'underdetermine' learning. On the other hand I am strongly convinced that for some specific contexts specific media are better than other (Greville studies art history he says. Obviously studying arts without a technology which allows to display pictures is likely to be less effective.)
I end here in order to post my comments now. Let me end with citing Robert Welton.
| Robert wrote: "Having visiting professors who wrote our textbooks has been a really neat part of this program and past courses so I too welcome you to our course." (Robert, 4.6.1) |
I think most of you agree
Kind regards
Thomas
Dear all,
This module is composed of two main components being posted in sequence. The first set of main topics revisits the question of costing educational technologies. The original aim certainly was to compare educational technologies and guide the educational manager to select the one appropriate. However, you will see that this attempt seems to open a Pandora's box of questions which are difficult to answer. In this context you will look at (i) the media equivalence theory; (ii) Bates' ACTIONS model; and (iii) the use of cost per student learning hour. Hence, following this introductory main topic, we will have the following further main topics:
2. Media Equivalence Theory
This main topic will revisit the debate on comparative effectiveness. The 'Media equivalence hypothesis' reflects a traditional mainstream position of distance educators. The main virtue of this hypothesis, if true, would collapse comparative cost-effectiveness analysis to cost analysis. It was the increasing experience with the use of different media which eroded the consensus on media equivalence towards greater interest in understanding the different capabilities of media.3. Bates' ACTIONS Model
The impossibility to determine a cost-effectiveness ratio leads either to collapsing the issue of cost-effectiveness to a simple issue of cost-analysis or to embed it into a more complex multidimensional framework such as Bates Actions model. For those hankering for a more formal, quasi mathematical criterion to compare the cost-effectiveness between media this comes as a disappointment since it is obvious that Bates model does not provide an algorithm for the selection of educational media but a framework to guide judgment.4. Cost per Student Learning Hour (SLH)
Measuring costs of educational technologies or media is the easy part, they say. But still you want to measure in order to compare. An assorted collection of figures on how much a computer costs, how much to print a book etc., will not be sufficient to guide the educational planner. To compare you need a common unit of measurement. For the educational decision maker the question is which medium (or mix of media) should I choose for supporting learning most cost-effectively. This topic 'Cost per student learning hours' argues the only reasonable way to compare costs of media is per learning time, i.e. how much would it cost to support say 10 student learning hours (SLH) using radio, print or, say, conventional classroom teaching. This approach is chosen in Hülsmann (2000).
The remaining main topics will be posted a week later. The uniting theme is Net-based learning. We will (i) look at the main cost drivers in Net-based learning; especially, the (ii) costs of online student support, leading to a discussion of (iii) the cost-structure of Net-based distance education. Finally, (iv) we will revisit the various issues in a context of training. This leads to the following main topics to be posted in a week to come:
5. Cost Drivers of Net-based Learning
While the general methodology of costing Net-based learning is the same as for other forms of distance learning there are a number of cost drivers which are specific for Net-based learning. They include infrastructure costs and costs of being online. This main topic invites you to read
-- Rumble, G. (2001). The costs and costing of networked learning. Journal of Asynchronous Learning Networks, 5(2), 75-96.6. Costs of online student support
Technology has increased the capability of distance learning for srudent/teacher and peer interactivity. 'Access to the professor' is possible but comes at a cost. This main topic discusses the ensuing options in DE: curbing the level of interactivity, using adjunct faculty (labor labor substitution) or charging students for additional support.This main topic invites you to read
-- Rumble, G. (2001, 1 - 5 April). The costs of providing online student support services. Paper presented at the 20th World Conference of the International Council for Open and Distance education, Düsseldorf, Germany.7. Cost structure of Net-based distance education
There is little doubt that Net-based distance education leads to a different cost structure. It is less scale economies than the hope that modularization and re-usability leads to efficiency gains of a post-Fordist type of distance education. We invite to read
-- Bishop, T., SchWeber, C. (2000). UMUC's Online MBA Program: A case study of cost-effectiveness and the implications for large-scale programs. In J. C. Moore (Ed.), Online education: learning effectiveness, faculty satisfaction and cost effectiveness (Vol. 2): SCOLE (Sloan Center for Online Education) of the Alfred P. Sloan Foundation Asynchronous Learning Network.
-- Hülsmann, T. (2002, forthcoming). Costs without camouflage: A oost-analysis of Oldenburg University's two Graduate Certificate Programs offered as part of the Online Master of Distance Education (MDE) - A case study. In U. Bernath, Rubin, E. (Ed.), Reflections on teaching and learning in an online master program - a case study (Vol. 6). Oldenburg: Bibliotheks- und Informationssystem der Universität Oldenburg.8. Net-based education and training
Training has been discussed only marginally in this course. This main topic invites you to read Whalen & Wright (1999) and to examine some specifics of online training. Some interesting features of this discussion is the 'time compression' idea which often comes up and the question to which extent and when opportunity costs of lost productivity is to be included into a cost analysis. This main topic invites you to read
-- Whalen, T., & Wright, D. (1999). Methodology for Cost-Benefit Analysis of Web-Based Tele-Learning: Case Study of the Bell. Online Institute American Journal of Distance Education, 13 No 1.
To summarize: You will see eight main topics (the first four this week, the next four in a week to come), i.e.
Kind regards
Thomas
Media equivalence hypothesis
Dear all,
Let me begin with an 'advance organizer' and then elaborate.
What is the issue about?
The first reference to the 'media equivalence theory' I found in Perraton (1987)
"We can state the theory of media equivalence baldly: communication media do not differ in their educational effectiveness." (p.4)
I prefer to call it a hypothesis because, since, as far as I see, it
includes basically one statement, and a theory usually comprises a set
of related statements.
There is no real agreement on how exactly this hypothesis is to be interpreted.
There are 'weak' versions and 'strong' ones. A weak one would be the one used
by Moore & Kearsley (1996):
"Provided the medium is well-chosen and functioning effectively, it plays a minor role in affecting learning outcomes." (p.65)
Most of us would agree but the caveats at the beginning of the statement
makes it almost devoid of risk and, by implication, of empirical content. That
Moore & Kearsley are not defenders of a strong version of media equivalence
is reflected in the care they take to describe the various capabilities of the
media and the suggestions they make for media selection (cf. ibid p. 98 ff).
A strong formulation is the one of Clark (1983):
"...media comparison studies clearly suggest that media do not influence learning under any conditions." (p. 445)
"The best current evidence is that media are mere vehicles that deliver instruction but do not influence student achievement any more than the truck that delivers our groceries causes changes of nutrition." (Orivel 1996 quoting Clark, p. 846-7)
However, we need to look where are the battle lines: Clark considers it a waste of resources to identify a sort of 'silver bullit' medium. The thrust of his argument is not 'all media have a strong albeit equal influence' but 'all media have an equal albeit zero level influence'. This signals his line of argument: he distinguishes between teaching methodology and media. He seems, however, to avoid the question if media characteristics constrain and enable methodology. Here I see Kozma's point: media have intrinsic characteristics which support what you can do with them (e.g. processing power of computers). Kozma makes also an interesting distinction between media and technology.
Why this debate is important in an economics class?
Let me repeat here why the question of effectiveness impinges on cost-effectiveness
analysis: Assume you want to compare technology A and
technology B. Assume further that you can measure the costs of A, i.e. C(A),
to achieve a certain effect E(A) and similarly C(B) to achieve E(B). The CEA
(i.e. cost-effectiveness analysis) selection rule says: choose the technology
for which the ratio of costs to effects is minimal, i.e. if
and 
choose A if r(A) <r(B).
You can have the following cases:
|
I) Cost A <= cost B and effectiveness A <= effectiveness B |
II) Cost A > cost B and effectiveness A <= effectiveness B |
|
III) Cost A <= cost B and effectiveness A > effectiveness |
IV) Cost A > cost B and effectiveness A > effectiveness |
Case I and case IV are difficult to decide on a qualitative level. In case II we would opt for B since its effectiveness is bigger (or equal) but its costs smaller. In case III we opt for similar reasons for A. - Imagine now that the effectiveness can be considered as equal, i.e. E(A) = E(B), then it holds that r(A) < r(B) iff C(A) <C(B).
If media have no specific capabilities to teach more or less effectively, you may say that cost-effectiveness analysis collapses to cost analysis. I think part of the reason why the theory of media equivalence was so popular under distance educators (especially, those looking at cost issues) was that it 'covered their back' and allowed them to do their job without having to bother too much about effectiveness issues invalidating their findings on costs of media.
What is the outcome of the debate?
In an earlier class Greville commented on the issue and I later restated Greville's reaction which, I think, reflects a reasoned position. I quote from there:
| Greville's reaction to my summary: |
| 7. The debate on media equivalence. "A debate
Greville obviously only would touch with a barge pole."
Not really, Thomas, I just find it boring
after all these years. Fundamentally I am an AGNOSTIC, I do not know what
I believe but I DO believe that some media are better suited to some things
(e.g. video to teach fly fishing at a distance!), and I also think that
there is a cultural dimension Greville, I think 'outed' himself as a, though cautious, supporter of the media equivalence theory. Umm - not sure about this. Agnostic but veering the other
way, Thomas. Hence as you point out I argue that attitudes are better
learned in social interaction. I do think one needs to choose technology
carefully - c.f. Bates's ACTIONS criteria (which I also used in a service
context - c.f. Greville Rumble. 2000. Student support in distance education
in the 21st century: Learning from |
| Greville's final reaction to media equivalence: |
|
Once upon a time I was trained as a philosopher .. bad move: one splits hairs. So, ... where do I stand: a. Not all media are equivalent
b. But given that two or more media have the capabilities that you want, there is no convincing evidence that any one partcular medium is better than another. Pending convincing research, and within these boundaries, I remain agnostic on media equivalency. |
Just forget about the debate?
We will re-visit the issue of time compression in relation to the Whalen & Wright case study (Main topic 8). What applies to the effectiveness of media (i.e. being context related), does apply also for the time compression issue. Certainly online communication speeds up communication processes (e.g. as compared to correspondance) and in specific cases effective integration of media in learning processes might speed up learning. That media relate to time is also illustrated by the impression many learners have that hypertext presentation may increase time requirements. My hunch would be that, like it is the case for learning effectiveness in general, the way media choice impinges on learning time depends on context factors, and the integration of media with learner profile and content characteristics.
Interactivity! Ainsworth (2000) asks 'if it is worth the candle'. Being a defender of traditional DE, he doubts it. Interactivity includes peer interaction. The value of peer interactivity, is questioned. Laurillard (1993) calls it "one of the great untested assumptions of current educational practice". (p.171) I bring up the issue of interactivity repeatedly since distance educators here have to make choices. Rumble (2001) writes that
"societies and nations fracture across ever widening gaps in wealth. The Open University was born with a highly developed sense that it was committed to ironing out some of the inequalities that resulted from an elite educational system. It led the way towards mass education in this country, and it exported its system in the belief that this would help developing countries expand their education systems. Given where we are, the Open University may well have a choice in what it does, but increasingly I think the choices are forced to make at the expense of the ideals that led to its birth. That may not be a price too high for survival and development, but a significant cost." (Rumble 2001, p. 28)
I will conclude the main topic here. We partially discussed the issue already but you are welcome to comment again. Media choice is related to pedagogical ideals but has, because of its specific cost structures, also policy implications relating to democratic and social ideals.
Kind regards
Thomas
_____________________________________
References:
-- Ainsworth, D. (2000, September 11-13). The
unbearable cost of interaction. Paper presented at the International
Conference sponsored by the University of South Australia in conjunction with
the International Council for Open and Distance Education (ICDE), University
of South Australia, Adelaide, Australia.
-- Carter, V. (1996). Do
media influence learning? Revisiting the debate in the context of distance education.
Open Learning, 11(1), 31-40.
-- Clark, R. E. (1983). Reconsidering
Research on Learning from Media. Review of Educational Research, 53(4),
445-449.
-- Kozma, R. B. (1991). Learning
with Media. Review of Educational Research, 61(2), 179-211.
-- Laurillard, D. (1993). Rethinking university teaching: a framework for
the effective use of educational technology. London: Routledge.
-- Moore, M., and Kearsley, G. (1996). Distance Education:
A Systems View. Belmont: Wadsworth Publishing Company.
-- Orivel, F. (1996). Evaluation of Distance Education:
Cost-Effectiveness. In A. Tuijman (Ed.), International Encyclopedia of Adult
and Continuing Education. Oxford: Pergamon.
-- Perraton, H. (1987). The Roles of Theory and Generalisation
in the Practice of Distance Education. Hagen: Zentrales Institut für
Fernstudien.
-- Rumble, G. (2001). E-education: whose benefits, whose costs? Inaugural
Lecture, Wednesday, 28 February 2001.
-- Thalheimer, W. (2002, June, 6). Stop
aiming for interactivity. e-learning. Retrieved 06.17, 2002, from
the World Wide Web: http://www.elearningmag.com/elearning/content/contentDetail.jsp?id=21297
Dear all,
This term, for the first time, I have discarded Bates (1995) as second textbook. This is because the cost data are slightly dated and we would not classify necessarily the media along the same lines. However, the book contains an important chapter called "Selecting technologies: sorting out the differences" which exposes among others Tony' ACTIONS model. This is a more complex framework guiding media selection which includes costs but only as one parameter among others.
The double entry table below gives the template for the whole Bates (1995).
| Chapter 4: | Chapter 5: | Chapter 6: | Chapter 7: | Chapter 8: | Chapter 9: | Chapter 10: | |
|
ACTIONS
|
Television: educational broadcasting | Instructional Television | One-way audio: radio and audio cassettes | Two-way audio:telephone teaching and audio-graphics | Computer based learning and multimedia | Computer mediated communication | |
| Access | |||||||
| Costs | |||||||
| Teaching and learning | |||||||
| Interaction, user friendliness, and control | |||||||
| Organizational issues | |||||||
| Novelty | |||||||
| Speed |
Let us have a look on the concept which make up the ACTIONS model:
A - Access:
Who are the learners we target? Do these learners have access? Where would they
have access? The question of access leads to the issue to costs. Often access
may be in principle available but may come at considerable costs to the learner.
Access is not a question to be asked with respect to the Internet only but relates
to libraries, or facilities to make experiments in physics and chemistry.
The UKOU decided to facilitate access by founding study centers. These
study centers are crucial for support and counseling but also for holding tutorials.
- It is interesting that to facilitate Internet access in developing countries
community based access points are considered. But access is not only a problem
with respect to the Internet. Often specific courses would require to undertake
experiments. The course developers must ask: how can we arrange that the learners
can undertake these experiments, what does it involve? Solutions may range from
experimental kits, summer schools, or rallying the support of professional institutions.
C - Costs:
Costing is the easy thing, I have heard. This impression may seem justified
when having looked at the exasperating situation of assessing the effectiveness
of media. But it is not so easy either. Apart from the need to overcome the
secret service attitude surrounding internal cost data, the institutional researcher,
who is interested in comparing the cost of educational media, must decide: what
is my common unit of measurement?
Bates asks: how much would it cost to support one hour of student learning,
using a given technology. You find his formula in Bates, 1995, p.41.
Bates refers to average cost per student learning hour. The formula later is
| Formula | Interpretation |
 |
 |
Basically in the numerator Bates aggregates all the direct costs of a course
and divides them by all the learning hours which have been supported by the
course. In the case of 15 students doing 150 hours of studying for this course
2250 SLH. Given that the direct costs of the course are $50000, the cost per
learning hour would be about $22.
We will discuss the issue in some detail below. In my opinion this formula is
not too helpful since it camouflages somewhat the cost structure of a technology.
In principle the cost per student learning hour (cost/SLH) as defined by Bates
depends much on the circumstances under which the technology is applied rather
than on its intrinsic characteristics. If you happen to have many students you
come up with a low cost/SLH. This shows that your findings on the basis of Bates'
formula do not identify the intrinsic cost characteristics of the medium. I
prefer therefore to report separately the benchmark fixed costs and benchmark
variable costs of each type of medium (Hülsmann, 2000). I regard this as
being more informative for the decision maker. Tony himself draws attention
to this in his discussion of 'cost structures' (cf. Costs and decision making,
ibid. p. 42). It is important to see that different media have different
cost-structures: i.e. different compositions of costs in terms of fixed and
variable costs.- Leaving aside the formula suggested I agree with Tony that
cost/student learning hours (cost/SLH) is the only reasonable cost parameter
to compare costs of media.
T - Teaching and learning:
The strength of Tony's model is that it comprises a wide range of aspects including
different learning theories.
Behaviorism, cognitive theories, humanistic psychology. Useful for reading more
on learning theories is Kearsley's Explorations
in Learning & Instruction: The Theory Into Practice Database.
Behaviorism you find under 'Operant
conditioning' (Skinner); I would additionally include Connectionism
(E. Thorndike) and Criterion
Referenced Instruction (Mager) under the behaviorist heading.
For cognitive theories you find 'Constructivism'
(Bruner) or the 'Genetic epistemology'
(Piaget). I would include here Social
Development Theory (L. Vygotsky)
The humanistic camp is represented by the theory Experiential
Learning (C. Rogers).
You find a number of other relevant learning theories included. My recommended
selection: Andragogy (M.
Knowles), because of its relevance to adult education; Conditions
of Learning (Gagné), because it is so well known and serves as a
reference point; Conversation
Theory (G. Pask) which I regard to be relevant as point of comparison when
you want to analyze online communication; Subsumption
Theory (D. Ausubel), the famous inventor of the 'advance organizer'; Situated
Learning (J. Lave) very relevant for teaching in different cultural contexts.
For the course team charged with developing a course, taking a stance on learning
theories is a profoundly practical issue. It will have a strong impact on media
choice. Behaviorist positions are more likely to endorse automated multiple
choice exercises as constructivist approaches. Taking an explicit stance on
learning theories also identifies the frame of reference you are prepared to
accept as frame of reference for evaluation.
Note that Bates distinction between (i) the remote classroom and (ii) front-end
systems design parallels largely the distinction between synchronous teaching
at a distance and asynchronous forms of distance teaching. What does he say
here?
How do different media support teaching and learning? I find Laurillard's distinction
practical (attending, debating, practicing, articulating; Laurillard, D. (1993).
Rethinking University Teaching: A Framework for the Effective Use of Educational
Technology. London: Routledge).
Practically: we need to relate media to content but also to learners. Often
the content is known, and about the learners we have some information i.e. their
academic credentials qualifies them for participation.
I - Interaction, user friendliness, and control
Starting point is the 'loneliness of the distance learner', immediately followed
by the section 'learning as a social activity'. These points are intimately
related to how you conceptualize learning (Piaget might be quite happy with
the idea of the lonely learner, while Vygotsky would not.) The important thing
is that media support different modes of learning. Obviously, radio facilitates
what Laurillard refers to as 'attending' (in this case listening). It does not
(in any case if not specific arrangements are made) support 'debating'.
Lack of interactivity has been often identified as the Achilles Heel of DE.
I distinguish between resource media (for presentation) and communication media.
The course team needs to decide about the optimal balance between 'attending,
debating, practicing, articulating'. From there we can decide about the best
mix of media.
O - Organizational issues:
There are two headings: External factors; internal restructuring (re-engineering).
External factors which have made UK universities consider resource based teaching
included the obligation by funding institutions to make demonstrable 'efficiency
gains'. The question of internal restructuring organizations is discussed in
detail in: Bates, 2000, our new textbook.
N - Novelty
Novelty and speed get a superficial treatment suggesting that they might
have been introduced only because they were needed for the acronym. However,
it is true that it is often easier to get funds for new technologies than for
proven ones in spite of the saying that 'leading edge technology does not imply
leading edge teaching'. Evaluators refer to the Hawthorne effect as possibly
distorting results.
S - Speed
Speed is important in several aspects: time to return answers; assignments.
This is essential for keeping up motivation. Secondly for course developers:
time-to-market is important. Technologies differ in this respect too.
I would ask you to comment here on the different aspects of the ACTIONS model.
Kind regards
Thomas
________________________________________
References:
-- Bates, A. W. (1995). Technology, Open Learning and Distance Education.
London: Routledge.
-- Bates, A. W. (2000). Managing Technological Change: Strategies for College
and University Leaders. San Francisco: Jossey Bass.
Dear all,
Tony Bates' ACTIONS model is more complex for media selection but leads not to a clear cut algorithm for media selection as protagonists of cost-effectiveness analysis might have hoped for. The ACTIONS framework includes costs as one aspect. Here Bates uses the idea of learning time to compare media costs.
The idea to determine cost per learning hour first reflects resignation with the cost-effectiveness research. If 'media underdetermine learning' the 'research program' to identify cost per learning gain proves to be a blind alley. To 'collapse' the notion of cost-effectiveness (i.e. effectiveness gain/cost) to cost analysis can be seen as a 'retreat for safety'. Costing technologies seems to be straight forward at first sight. It produces figures and figures can be compared. We can say how much a computer (of a certain specification) costs and how much it cost to print this or that book. However, we need to compare 'like with like'. And in order to be able to do that we need a common unit of measurement. This common denominator is for Bates cost per learning hour.
Many institutions indicate that a learner would need a specified number of study hours to complete a course. This does not suggest that all need the same time but that the type of learner envisaged for the course on average would need to study approximately the specified time to complete the course successfully. This study time would include working through the resource material provided and possibly a specified time for communication with a tutor or teacher. Depending on the type of resources created (type of media) and the technology in which the communication is to be conducted, a cost per learning time can be specified. Both Bates (1995) and Hülsmann (2000) use this measure albeit in a different manner.
Bates aggregates all the direct costs of a course in one figure (the numerator) and divides them by all the learning hours which have been supported by the course. In the case of 15 students doing 150 hours of studying for this course 2250 SLH. Given that the direct costs of the course are $50000, the cost per learning hour would be about $22. The problem is that such figures are too context sensitive (e.g. how many students finally enroll in the course) and will not discriminate on favor of a specific technology.
Hülsmann (2000) focusses primarily on identifying development cost per one hour of student learning. Here, he suggests that there are different orders of magnitudes (cf. Table 1.3). But also benchmark communication costs can be specified for different media (cf. Table 1.5). Having benchmark figures for cost per student learning hour for developing material in various media and communication using specific media allows to model costs. The intention is not any more to compare the cost-effectiveness of educational technology but to develop a tool for rapid cost appraisal in order to keep cost implications of decisions on media visible. The intention is not to prescribe certain media on the basis of debatable findings on cost-effectiveness.
Attached you find an example of a costing tool which allows you to modify your media mix. Such a tool would allow an instant cost appraisal of the media mix required, this keeping, as we put it, the cost dimension of the pedagogical decisions visible.
The below figure may help to depict the interplay of cost-analysis and pedagogical considerations in selecting the appropriate medium. There are two dimensions the dimension of affordability and the dimension of effectiveness. Precedence take pedagogical considerations about effectiveness. What do we want to teach? To whom? Obviously we need audio media if we want to teach languages or options for visual display if we want to develop a course in Reneaisaance art. These pedagogy-led considerations identify (or exclude) a medium or a mix of media required. Then comes cost-analysis in since it can provide an interactive tool to rapidly appraise the cost implications of a media decision. This I call 'check for budget compliance', and it determines if the requested media mix is affordable within the budget limits.
 |
The figure shows that cost-analysis can rule out some combinations of media which are not affordable; that pedagogical consideration also may lead to categorically exclude some media combinations. But while both checks exclude a number of options they may leave us with a number of remaining options which cannot in any sensible manner linearly ordered. We can say: 'this one is more affordable than this one, that one possibly more effective for our purpose than that', but the remaining set of options (being both effective and affordable) is not really 'totally ordered', i.e. it does not lend itself to being put into a single line (at least not without some procrustean violence).
Kind regards
Thomas
__________________________________
References:
-- Hülsmann, T. (2000). The Costs of Open Learning: a Handbook.
Oldenburg: BIS.
Chapter
1: What we found
Chapter
2: How we found it
Case
study 1: .. from the UKOU
Case
study 3.... from NKS (Norway)
Case
study 9.... about videoconferencing (Italy)
Dear all,
While the costing methodology is essentially the same: listing the ingredients, quantifying them, classifying them in terms of fixed/variable, capital recurrent costs and calculating the total or average costs. There are, however, some cost drivers which are specific when it comes to online courses. These specifics include:
The first two points relate to hardware and I would like this to be a main topic where we can exchange information. The last point will be discussed in the next main topic.
An example for an academic middle level learning environment would be the joint venture of the three distance learning centers in Lower Saxony where the universities of Oldenburg, Lüneburg and Hildesheim have joined forces: We run five powerful servers to offer 150 online courses in which about 2000 students are enrolled. Each of the servers costs about € 10 000 (or $ since it is about the same for the time being) which annualized over 3 years would mean an annualization rate of € 20 000. According to the personnel running the servers we might be a bit over-equipped (and possibly understaffed). This is due to the high level of security we need to provide (this explains the costs of the servers which have built in a number of security mechanisms) and the fact that we made a distinction between German and English servers (though we are gaining experience of catering for Russian users from an English server).- Server infrastructure requires personnel. Here we are possibly understaffed. Minimum requirements would be to have the equivalent of 1 full time professional with costs about € 60 000 per annum. Hence to run our server infrastructure costs about € 80 000 with about 75% of personnel costs. - We run the courses on Lotus Learning Space which is both a learning management system as a content management system. In principle it is possible to run Learning Space on one server. This is a difference with e.g. Hyperwave for which you would need about four servers to start with. The per student license fees are with € 9 per student comparatively moderate. These fees, however, apply only for academic user environment.
As I said, there is still much unused server space and we could host many more courses. In the present situation we would charge an overhead per course of about € 600. This is the three times what Bates estimates for server costs (cf. Bates, 2000, p.139, Fixed costs, item eight, figure converted but not deflated).
Computers prices have come down. A workstation including a Pentium IV, LDC and a Laser Printer would cost about € 2300 (Pentium IV, LDC = € 1 500, Printer € 800 approximately). This means annualized over 3 years about € 900 per year. If you consider that the equipment is used for many purposes costs attributable to one course may be a third (€ 300) only. On the other side a number of personnel may work on this course. Two to three is not an unrealistic figure which would lead to a hardware charge attributable to a course of about € 1 000. (The respective figure in Bates' Table 6.1 includes charges from UBC's central computers. It is not clear how to unpack the figure of ca. € 2 700 he comes up with. But it is of the same order of magnitude.
These are the cost to the institution. In a full cost study you might want to include the cost to the student also. This would include the purchase of software and hardware. Prices of software are often distinct for the academic and for profit market and for the academic context. (As mentioned above we can offer a per student license for LLS at a per student rate of €9. This would not be possible outside of Academia.)
Online costs depend very much on the context also. In the academic context 24 hours online access is free in Germany and the UK. This is different for the private user who may pay substantial fees (depending on the provider and the conditions). In the US flat rates make online time more affordable to the users. However, some learning platforms allow you to work off-line most of the time. Your modifications are later 'replicated' to the server which is done in a jiffy. Lotus Learning Space has this replication feature which makes it an attractive software for teaching in regions where bandwidth is low and online costs high (e.g. developing countries). Send your library on CD-ROM and install LLS on your machine and you will be able to communicate with low online costs.
However, also here costs depend very much on what exactly you want to do. This applies also to the server infrastructure. The capacity you would need would depend on the level of activity (e.g. number of courses to be he held on the server, the level of activities related to students enrolled in these courses, the level of activity, and the level of security you would aim at). If you want to use professional LMS (Learning Management Systems) able to trace a large number of learners and learning activities across various courses you would need more servers. Lotus would work in principle with one server while Hyperwave would require about four.
Bakia (2000), under the telling title "Costs of ICT use in higher education: What little we know", reports the following costs for the use of computers on campus as ranging between $142 and $490 (mean $333). But indicates that this is a low estimate since likely hidden costs of computer assistance and maintenance are not included. The costs of providing a computer based information system to support administrative services is costs between $200 000 to $500 000. (That the figure is not further explained throws a light on the quality of costing data. However, according to Rumble it is in administration that network technologies may lead to the most significant efficiency gains. (Rumble, 2001)).
Rumble (2001) quotes a Gartner Group report which suggests that e-commerce web sites would cost about a million dollars on average (Rumble, 2001, Annex 2) but continues to say that "few cost studies cost development of the web site at anything like this level of expenditure." Other than the Gartner report which sees costs rising there are indications that at least the costs of developing more simple websites decline since the authoring tools become more user-friendly and the knowledge of building websites becomes more and more common.
Bruns & Gajewski (1998, pp. 193-194) a German guide to multimedia network-based learning suggests several approaches including the Bergman-Moore Formula for estimating the cost of developing online media.
Total cost = Quality-factor x € 50 000 x Student Learning Time
The formula assumes a range for the quality factor between 0 and 6.5. 'Quality' (meaning level of sophistication) depends on the following factors:
Example: For a 2 hours training application using text and graphics
only we assume a Q-factor of 0.5. Hence we should calculate 0.5 x € 50 000
x 2h = € 50 000.
A conventional CBT would have a Q-factor between 0.5 and 1.5; for application
for marketing and commerce he assumes a Q-range between 2.5 and 5. However,
it needs to be taken into account if the media are to be produced in-house or
could be bought from outside to a reasonable price. Note that student learning
time comes in as unit of comparison! Unfortunately the central factor of €
50 000 per SLH is not unpacked or explained.
The authors also report another mode of calculating an electronic product, the High Text Formula which reads:
Total costs = Student learning time x (MQ + PQ) x € 50 000 + Hw
Example: Assume an online course of medium sophistication: many graphics
and all texts have to be newly produced. Hence level of availability is low
but since the media are simple to produce we assume MQ=0.5 + 0.5 =1. Assume
further the information is liked in various ways allowing the user different
approaches we grade PQ=1. Assume further that the learning time is 2 hours and
we neglect the hardware costs we get:
Total cost = 2h x (1MQ + 1PQ) x € 50 000 + 0 = € 200 000.
Note that the two formula are consistent. However, in both cases the € 50 000 are not further explained. It is important not to accept this formula as identifying the real costs but you may use them in your context and explore if they make sense there.
In a further Formula for Hypermedia Learning Programs the same authors
develop a guide for estimating costs based on person days (PD).
A(PD)= 27.1 PD + 0.4 PD x Pages of Text + 1.1 PD x Pages of Graphics + 61.7 PD x Hours of Animation + 103.7 PD x Hours of Video
Example: Assume that we want to offer content for 2 hours of student learning. Assume further that the student will spend about 1.5 minute per screen page we need to produce for the two hours 80 screen pages. Assume further you use you use an equal amount of graphic elements and text, then we need 40 screen pages of text and 40 graphic pages.
The above formula would suggest
A(PD)= 27.1 PD + 0.4 PD x 40 {Pages of Text} + 1.1 PD
x 40 {Pages of Graphics} + 61.7 PD x 0{Hours of Animation} + 103.7 PD x 0 {Hours
of Video}
A(PD)= 27.1 PD + 16 PD + 44 PD = 87.1 PD
If you assume an average cost of € 50 per person and an working day (PD) of eight hours you arrive at a total cost of € 34 840 for providing two hours of web based learning. (The break down is summarized in the table.)
| Type of input (in man days) |
Unit of measurement | Factor x man days | Cost per person day | Example: Inputs per unit |
Example: Cost per amount of input |
| Concept | person days | 27,10 | 400 | 1 | 10840 |
| Text | page | 0,40 | 400 | 40 | 6400 |
| Graphic | page | 1,10 | 400 | 40 | 17600 |
| Animation | learning hour | 61,70 | 400 |
0 | 0 |
| Video | learning hour | 103,70 | 400 | 0 | 0 |
| Total amount | 34840 |
Again where all these figures come from? Bruns & Gajewsky refer to the Multimedia Honararleitfaden 97/98 (Guide to multimedia honoraria 97/98). These guidelines are based on actually paid market rates which will change more or less rapidly and may be different in the US and Germany.
Kind regards
Thomas
____________________________________________
References:
-- Rumble, G. (2001). The costs and costing of networked learning. Journal
of Asynchronous Learning Networks, 5(2), 75-96.
-- Bates, A. W. (2000). Managing Technological Change: Strategies for College
and University Leaders. San Francisco: Jossey Bass.
-- Bruns, B., Gajewski, P. (1998). Multimediales Lernen im Netz: Leitfaden
für Entscheider und Planer. Berlin: Springer.
-- Bakia, M. (2000). Costs of ICT use in higher education: What little we know.
TechknowLogia: International Journal for the Advancement of Knowledge and
Learning, 2(1).
Dear all,
Student learning is supported by well designed learning material, by communication with the teacher and tutor and by communicating with other students. All three components are related to interactivity: student/content; student/tutor; student/student.
The first type of interactivity is a question of design. You can design a text in a more or less interactive way; you may insert questions, asking the student to make an experiment, reading a specific text or listening to a tape. Using electronic media you may include automated multiple choice questions or interactive spreadsheets. This often is referred to as CBL (Computer based Learning) or CBT (Computer based Training) and, as Rumble (2001, p.75) concludes involves no student support (meaning support by a teacher or tutor). It is clear that this type of design is what corporate training might go for. It is consistent with the typical cost-structure of distance education: high fixed costs but very low marginal costs. This means you can add another student into the system with minimal additional costs.
A moot point is the question about the optimal size of online classes. How many students an online teacher can handle within his/her workload? Rumble (2001) reports contradictory findings and obviously again it depends. It depends for instance on the level of motivation and interest the students show and the level of engagement of the teacher. You may design an online class as a seminar with high level of student teacher interaction and high level of peer interaction. In this case the communication volume can spiral. Unlike in a normal class where the level of communication is controlled by the turn taking (one speaks and all others listen) in online classes all may speak (write) at the same time (Hülsmann, 2002, a). You may have to deal with 30 messages distributed over several main topics if you fail to visit the classroom only for a few days. This is why Rumble reports that "the general consensus seems to be that online tutoring adds to traditional faculty workload....given the enormous volume of messaging....arising from increased interaction with students...., with each message requiring more time to compose than in verbal interactions..." (Rumble, 2001, 78) Below my findings based on the experience teaching MDE courses are summarized:
What is the ideal class size?
The ideal class size lies at an interval where the lower and upper limits depend on economic as well as on pedagogical considerations. On the lower limit side economics requires the class size to be above the break-even point. If we only take the direct costs of development and presentation and an average income per student of about US$ 500 to US$ 600 into account the break-even point is about 15 students per class. If we consider that direct cost of presentation and development amount to about 60% of the total costs the break even point would be about 21 students. Generally a new section is opened when the class size passes the 25 student limit.
This class size is also recommendable from a pedagogical point of view. In our experience about 70% of a class is quite active (i.e. 17.5 students of a class of 25). This number of actively participating students generates enough messages for a self-sustaining level of communication.
Low class sizes require a different approach to communication management. In OMDE 625 and OMDE 626 the 'learning contract' model was applied, where participants work on a project during the course, which is developed in steps (preparing an annotated bibliography; preparing of a project conference; conducting a project conference; writing the final paper) while bringing them together without having to engage in intense discussions during the 15 weeks of the course.
What is the teacher time required to teach an online class?
The messages signed by the lead faculty can be classified following Sims; Dobbs and Hand (2002) as 'predetermined and presented', 'teacher contributed', and 'captured dialogue' contributed by the teacher. Predetermined content here refers to the main topics which can be imported from earlier courses. They form the skeleton of a course and can be imported mechanically from one term to the other, which requires only a few minutes to do. 'Teacher contributed' content includes modifications of the predetermined content as well as 'wrapping ups' and providing feedback to assignments. Modifications such as changing dates, responding to minor changes, while taking little time, requires some attention to detail. A considerable amount of time is related to writing wrapping up messages and providing feedback for assignments. However, the largest time investment falls under the 'captured dialogue' category. This is a somewhat flexible category, since it depends on the faculty to which extent he or she drives the discussion.
The analysis of the allocation of teachers' time presented in this paper is the result of a triangulation of an activity based costing (ABC) approach and the time allocation implied in the job description. It leads us to estimate that the teaching faculty needs between 1 and 1.5 times the amount of the learning hours required from the students. This means about 15 to 22 hours per week per course.
(Hülsmann 2000 b)
In principle the situation is quite simple: the more communication is technologically facilitated the more communication with take place. To keep costs down you can adopt several strategies (i) contain communication with the tutor; (ii) use cheaper labor (labor labor substitution); (iii) emphasize peer communication as compared to teacher student communication.
To contain the volume of communication with the teacher can be done by asking the tutor to keep his/her engagement with students in the limit of the time specified in the contract (the institution may well benefit since teachers may want to support students disregarding their exact remuneration. You may also go for a pedagogical design which emphasizes (possibly under the pretext of constructivism and autonomous learning) self-study. Finally options may be considered to make student pay according to the tuition time they require.
Labor for labor substitution is a widely practiced option. It is rare that the tenured professor engages in long online debates with the student. If the tenured professor is involved he/she may work with assistant staff to sift the more relevant questions and deal with the rest. Generally it is adjunct faculty which does the tutoring work and the tenured professors may appear as visiting expert for a limited time.
While peer communication without doubt increases the noise in the classroom it is at the same time an enrichment. (This is especially the case in postgraduate studies where teaching rather takes the form of a professional exchange than follows the more didactic modes instruction.) One strategy is to fend off the questions to the tutor and redirect them to the students. Online tutors often find small classes more labor intensive than classes of reasonable size since the level of interactivity is not self-sustaining while in bigger classes it is.
One finding is rather clear and consistent with the general findings about the cost structure of online teaching: communication technologies, which facilitate communication with the teacher, have the tendency to increase variable costs per student and erode the cost-structural advantage of DE.
Kind regards
Thomas
__________________________________
References:
-- Hülsmann, T. (2002 a). Texts that talk back - Asynchronous conferencing:
a possible form of academic discourse? In U. Bernath, Rubin, E. (Ed.), Reflections
on teaching and learning in an online master program - A case study. (Vol. 6).
Oldenburg: Bibliotheks- und Informationssystem der Universität Oldenburg.
-- Hülsmann, T. (2002 b). Costs without camouflage: A oost-analysis of
Oldenburg University's two Graduate Certificate Programs offered as part of
the Online Master of Distance Education (MDE) - A case study. In U. Bernath,
Rubin, E. (Ed.), Reflections on teaching and learning in an online master program
- a case study (Vol. 6). Oldenburg: Bibliotheks- und Informationssystem der
Universität Oldenburg.
-- Rumble, G. (2001, 1 - 5 April). The costs of providing online student
support services. Paper presented at the 20th World Conference of the International
Council for Open and Distance education, Düsseldorf, Germany.
-- Sims, R., Dobbs, G., Hand,. T. (2002). Enhancing quality in online learning:
Scaffolding planning, design through proactive evaluation. Distance Education,
23(2).
Dear all,
Let us look back and position the discussion of online learning in the context of the argument developed in the course so far.
Distance education was described by Peters as the most industrialized mode of teaching and learning. It uses rational processes of organization and applies technology. Peters came to this conclusion when reviewing world wide distance education projects. The technology in those days was rather limited, mostly correspondence, the full scale application of educational radio and television broadcasting still in the offing.
Rumble and others have translated the idea of 'industrialized mode of teaching and learning' into economic equations. Industrial production is essentially cost-efficient because of the scale economies we get if we adopt this style of production. We have seen how the cost-efficiency argument attracted also people who wanted distance education less for its cost-efficiency advantages but for increasing access. But inspecting the AC equation explained why many people of different coleur could subscribe to DE: it is both cost-efficient and allows to expand access.
However, we have also seen that for getting our scale economies we would need to control aggregate cost per student (unit costs V) while increasing enrollment. On an institutional level this means few courses with high level of enrollment running for a long time. The approach was described later was as Fordist mode of distance education. Ford said "you may have any color for your car as long as it is black". In the same sense we found that distance education lives from scale economies and fears the diseconomies of scope.
Along comes the Internet revolution. Suddenly distance educators can communicate at a distance (other than per correspondence or telephone). Learning platforms and learning management systems are being developed which allow group communication. Even if asynchronous, response time can be shortened considerably (it is not the technology but costs and flexibility reasons which determine the rhythm of communication. Rumble's inspection of online learning suggests that it will come with increased costs. This is true to the extent the communication element (student teacher interactivity) is emphasized. We reported that enormous efforts are made to develop CBT and CBL emphasizing a student content interactivity on a higher level. But if it is true what Turoff (1997) suggests that the educational goals of higher education cannot never be fully responded to by simulating and automating interactivity, the facilitation of communicating at a distance will increase the demand for communication with the teacher and increase therefore unit costs. It may be scalable without scale economies.
However, Peters early on sensed that times were changing and he reacted to the debate of Post-Fordism and launched the idea of distance education in a postindustrial society. He correctly observed that learners would want more individual and customized responses. It was pointed out that especially modern communication technologies allowed just-in-time production and high level of customization to increase customer satisfaction. Unfortunately, unlike Peters concept of industrialized teaching and learning which could be translated into economic equations the concept of distance education in a post-industrialized society has not yet found such a model.
If we review what happens in the car industry we may get an idea where efficiencies of online learning may come from. Car manufacturers often operate with few platforms and customize them to respond for divers customer needs. It is again the process of standardization and modularization which allows to recombine standard parts to a rather individual whole.
Possibly it distance education can do the same thing. Standards of learning platforms develop. They become increasingly interoperable. There are much efforts underway to improve archiving of content. Online courses are well documented and can easily be updated. To the extent modularization increases archived content can be retrieved updated and recombined. There are obviously efficiencies to be gained here. Distance education may prove to be the most industrialized mode of teaching and learning even in the context Post-Fordism.
Kind regards
Thomas
________________________________
References:
-- Peters, O. (1994). Distance education and industrial production: a comparative
outline (1967). In D. Keegan (Ed.), Otto Peters on distance education.
The industrialisation of teaching and learning (pp. 107-127). London
and New York: Routledge.
-- Peters, O. (1993). Distance education in a post-industrial society. In D.
Keegan (Ed.), Foundations of Distance Education. London: Routledge.
-- Turoff, M. (1997). Alternative
Futures for Distance Learning: The Force and the Darkside. Retrieved
09 28, 2001, from the World Wide Web: http://eies.njit.edu/~turoff/Papers/darkaln.html
Dear all,
Whalen & Wright (1999) compare four forms of training within a corporate
business with traditional face to face training. Three asynchronous learning
platforms are compared and one synchronous. The article is based on assumptions
of on compression of learning time which has to be scrutinized. Otherwise
it demonstrates that multimedia input is a strong cost driver. Since multimedia
input is more likely in asynchronous provision it turns out that the synchronous
way of teaching is the most cost-effective.
The Whalen & Wright (1998) paper looks at training. Let me again quote Rumble who summarized the Whalen & Wright paper in a table during the ICDE world conference 2001:
| Table 1: Per-student
cost of classroom and 4 different formats of a Web-based course Source: Whalen and Wright (1998: 40) Per student cost, Canadian $ |
 |
Class-course | Web-course |
| Type | Synchronous | Asynchronous | Asynchronous | Asynchronous | Synchronous |
| Annualisation of development costs (years * students) | 5 * 200 | 5 * 200 | 5 * 200 | 5 * 200 | 5 * 200 |
| Learning platform | N/a | WebCT | Mentys | Pebblesoft | Symposium |
| Course development |
143
|
660
|
660
|
434
|
53
|
| Tuition |
600
|
-
|
-
|
-
|
-
|
| Travel |
70
|
-
|
-
|
-
|
-
|
| Server |
-
|
25
|
25
|
25
|
25
|
| Learning platform |
-
|
0.14
|
7
|
8
|
3.50
|
| Student time |
614
|
110
|
110
|
110
|
176
|
| Instructor time |
-
|
-
|
-
|
-
|
66
|
| Total |
1427
|
795
|
802
|
577
|
324
|
| Savings per student over classroom delivery |
N/a
|
632
|
625
|
850
|
1103
|
| Whalen and Wright's (1998: 42) conclusion is that while asynchronous web-based courses have higher fixed development costs than classroom instruction, these are offset by lower variable delivery costs. A significant proportion of this saving derives from course compression (the fact that in a web-course it takes less student time to study a given body of material than is the case with classroom instruction). Obviously, where the opportunity costs of student time is an important factor - as in in-company training - this is an important cost consideration. This would not apply outside the training situation where student time is 'free' as far as the provider is concerned. |
Note that for none of the asynchronous courses the instructor is listed as a cost driver. Typically for the corporate training environment (???) this type of asynchronous web-based course is low in course presentation cost (costs due to communicating with the teacher or tutor). It is more in the line of CBT than CMC.
The course content is equivalent to a face to face course of 2 days. This content had been 'compressed' in the studied courses to 2.5 hours for the asynchronous case and into 4 for the synchronous case. Compression rates are debated in the literature. It is obviously important cost driver. Especially so in contexts of corporate training when students are allowed time for doing their studies during working time. In this case we would have to include the opportunity cost of lost productivity. In this case time is an especially important parameter and it is advisable to use technologies with high compression rates, i.e. shorter learning time for a given content. According to Whalen and Wright (1999) compression rates for asynchronous courses are 79% and for synchronous courses 67%; Hasebrook (1999, 2000) reports 70% for Web-based courses; more modest figures, about 30%, are reported by Witte (1995). However, Whalen and Wright assume that equivalent learning has been taken place but this was not verified by tests.
The central specific issue when looking at costing corporate training the question if the learner time is included as cost or not. If so travel time add to the opportunity cost of lost productivity and needs to be considered. The important role of time explains the interest in compression rates. For my taste, however, the debate on compression rate reminds me to the debate on media equivalence (and the search in vain for the Nuremberg funnel) and is likely to lead into a blind alley.
Kind regards
Thomas
___________________________________________
References:
-- Witte, K.-H. (1995). Nutzeffekte des Einsatzes und Kosten der Entwicklung
von Teachware: Empirische Untersuchung und Übertragung der Ergebnisse auf den
praktischen Entwicklungsprozeß. Bovenden: unitext Verlag
-- Whalen, T., & Wright, D. (1999). Methodology for Cost-Benefit Analysis of
Web-Based Tele-Learning: Case Study of the Bell Online Institute. In American
Journal of Distance Education, Vol. 13 No 1
-- Hasebrook, J. (1999). Web-based Training, Performance, and Controlling. In
Journal of Network and Computer Applications, 22, 51-64.
-- Hasebrook, J. (2000). Comparison of Face-to-Face and Team-Oriented, Selective
Web-Based Training in an European Bank. In WebNet 2000
Dear all,
This is the third assignment. The assignment is to be done as collaborative task. Due date is Wednesday, April 23.
The task is as follows:
The outcome will consist of two documents: (i) a short description of the project (text file); (ii) a cost analysis in spreadsheet format. The course literature and your own professional experience will provide you with ideas for such a scenario. Find atttached a format for your spreadsheet. You will have to modify the spreadsheet, including the cost figures, to suit your project description. For cost data draw from the course readings (where possible including references).
Include a discussion explaining your media choice with some reference to the ACTIONS model.
For illustration see the attached example of such a collaborative assignment (Case Study: Hogan & Hartson, LLP).
With respect to the easy to handle file formats on our side we recommend the following alternatives:
Rich Text Format (*.rtf)
The Rich Text Format is our preferred file format to avoid virus infections. Try to save your essay as (*.rtf) in your office software before attaching it to the WebTycho.
Submit to Assignments area.Excel (*.xls)
You need to use this format for the spreadsheet.
For reasons of consistency we suggest the following header on top of your essay and the accompanying spreadsheet:
[Your Name and Group]In case you face technical problems with WebTycho or any questions regarding the assignment, you may also send your essays as E-mail before the due date to: thomas.huelsmann@.uni-oldenburg.de
Best wishes,
Thomas
Dear all
Here my summary, subjective and too late as always. But since it was appreciated I don't want to let you down on this.
Introductory remark
The question of cost-effectiveness is about costs of educational outcomes. More precisely the costs of the respective inputs in terms of media and educational technologies to which specific outcomes can be attributed. This leads to the general question of how educational outcomes (e.g. learning measured by some indicator) relates to the educational inputs (or more exactly, there costs).
The discussion was sparked off by Robert (2.1) who reported that interactivity was taken to be regarded as very important. Hence we had to clarify what the term is intended to mean and it turned out that it is used in a different sense.
| Moore | Hülsmann |
| content student | internal interactivity |
| teacher student | external activity 1 (teacher student) |
| student student | external activity 2 (peer interactivity) |
What is important for an economics course is to see that content student interactivity is a question of design; in principle a fixed cost. It is important to see that electronic media allow much more than print media. But since it is a fixed cost enhancing internal interactivity is compatible with the traditional cost structure and scale economies. The problem lies with increasing teacher student interaction. This implies a shift of the cost structure back to conventional teaching. To contain costs in spite of increased teacher student interactivity it is possible to go for a labor labor substitution or to make students pay per question (amount of tuition required). This type of interactivity is a feature of recent technologies and tends to drive horses through the traditional scale economies argument in favor of DE. - Peer interactivity is not costly but a double edged weapon. It can increase noise, detract. On the other hand especially in postgraduate studies peer interactivity is quite often felt to be ' value adding'. But later comments (e.g. Kathleen 2.3) confirmed that group discussion can get 'noisy' and it needs some good threading and teacher guidance (i.e. technical and pedagogical dispositions) to achieve the desired result. At the same time the delays characteristic for asynchronous communication have a negative impact on focus and motivation.
What Briget (2.2) called Rumble's doctrine should be rather named Perraton's doctrine (i.e. that of media equivalence). I didn't comment on the nice connotation with 'all media are equal but some are more equal than others'. I think it summarizes quite appropriately the discussion. It was a great discussion and I think we can agree that by default we assume media equivalence unless specific context parameters make us to reconsider the issue (e.g. to teach deaf people don't use radio; if you want simulations electronic media are likely to be better than print etc.). It would be helpful to keep costs visible but the notion of cost-effectively correctly links costs to outcomes. Costs need to be considered in a broader valuation framework. ACTIONS of Tony Bates is one such suggestion.
The way the ACTIONS model treats costs makes it clear that cost figures need to be read in relation with the context. Robert volunteered a good practical example where he made use of Bates' framework. This allowed to be the discussion to be more concrete. I pointed out to the need to specify clearly the context for which Bates 'cost per student learning hour per student' are calculated. The need for context knowledge does not only apply for cost figures within this framework but it applies to all cost studies. It is quite important to realize this in order to be cautious about cost figures. I somewhat argued that, possibly in addition to the 'cost per learning hour per student' we should report fixed costs of development costs and the media related aggregate unit costs in addition separately. Since it is these costs which allow modeling. And modeling is basically a necessary condition for 'transferability'. My general assault against some cost methodologies is that it seems to suggest that we could sensibly aim as generalizations across context. In reality such generalizations oscillate between being trivial and being false. What we should aim at is enabling the reader to apply the information to his/her context, i.e. we should aim, not at generalizability, but at transferability. To report the F and V separately better facilitates to model AC for your situation (e.g. your specific N) than to give the unpacked AC figure.
I want to take the opportunity to say a word on learning styles. For my taste learning styles are too much taken as a given, too much part of nature rather than nurture. Learning styles are to be developed. In this sense it is not trying to find out which Myers Briggs class you fall under but to develop your learning style.
Let me take up some of the later questions in this thread since I did not answer them. (I must admit there was a time I was too overwhelmed with questions and other urgent things that I intentionally ignored the question in the earlier threads in order to address the questions of the later thread.)
There were questions with the spread sheet. I found Hada explained it well. Let me have another go. (i) In the course of my research I looked at different courses supported by different media mixes. Most of the courses were designed for a specified notional learning time. (Like in this course we have 150 SLH (Student learning hours).) First question: can we unpack this figures and attribute certain percentages of the time to certain media. I believe we can do that. There are assumptions on reading times which are partly based on research and partly based on what the course designers specified. With radio and TV or the 'personal media' (i.e. audio or video cassettes) time is (more or less) clear.
Now the problem of figures it that they are meaningful in one context and less meaningful in an other. If I read that the average cost per student was $200 what would it tell me as a course planner? These figures are not reflecting general facts but they may contain transferable information. If we unpack the AC=$200 it may come from AC=($40 000/2 000)+$180 I would be able to to say that for my situation where I plan a course for 200 students, other things being equal, I would have to expect an average cost of $380.
If I would have the information that the $4 000 include fixed costs of development for print and TV at a certain proportion this would possibly enhance transferability. Lets imagine that the $40 000 fixed costs are fixed costs of development for two media print and TV. The course comprises 50 notional SLH, most of the learning time is supported by print (45 SLH) and a small part only by TV. For the 45 SLH print I have fixed costs of development of $10 000, while most of the development costs are attributable to the development of the five TV hours ($30000). The variable costs of delivery are zero for TV and $180 for print (a bit high I agree but I want to keep within the example). In my institution TV is out of question. Hence we decide to take print only. Now the information allows me to do a bit of 'modeling', i.e. apply the data in the case study to my situation. Cost per SLH (print) in our case is $222. If I want to do all the 50 SLH to be supported by print only I have $1 111. Assume now that I have only 200 prospective students then my AC will be AC= ($1 111/200)+$180= $56+$180=$236. That is the basic idea.
The main point is that the question 'what does it cost?' is in fact a bit stupid since researchers will give you always the correct but trivial answer 'it depends'. If you report your figures in such a way that the reader can unpack them and transfer them then it makes sense. Transferability is a common responsibility of reader and author. The author must report his figures which enable the reader to unpack and make reasonable inferences.
The issue seems to be a bit strange to Momoe who seems to imagine a totally different context. The context of my case studies was that study material was developed by the institution. In her case it seems that there are little development costs. That is true for some contexts. The MDE program for instance as far as Oldenburg is concerned has not so much high development costs. Writing a syllabus and main topics. That's it. But OUUK invests massively in specially developed study guides, web sites and radio lectures. You may ask 'why they do that. All material is already on the market. Just buy it'. They see it differently.
To Kathleen: With respect to production costs. There is a semantic ambiguity. TV people talk about production costs in a sense of development costs. Production costs in my books are costs per student, e.g. replication of a cassette not the development of the content.
This thread was rather short. It started with a reminder that investment in equipment cannot be charged to one course only. Often we work for different projects and the technical infrastructure has to be attributed to the different cost centers according to the % of use. Theoretically an easy concept, practically not trivial.
I included the Bergmann-Moore formula in my initial posting not as an algorithm. It is again the idea to unpack the cost figures. This time by looking how they may be constructed. I came across during my research costing tool for course planners which differentiated basically between standard and high and low specification. The three categories were loosely defined and provided the benchmark for the course planner to negotiate with the respective producers. Obviously something like PQ is difficult to measure taken in the full sense of the word. But here the assumption is that interactivity with content (internal interactivity as I call it) is (if done well) pedagogically a plus. To which extent students can do more than reading viewing listening but modeling (e.g. our spreadsheets) is seen as an advantage. Depending on the learning style learners do appreciate such interactive options.
Such interactive options are certainly cost drivers. But as said before in different ways. All what can be automated may cost a lot but could be dealt with by spreading it over large numbers (at least where we can hope for large numbers). This is true for content-student interactivity. As said earlier this content student interactivity ranges from simple and straight forward in-text questions to quizzes to interactive spreadsheets, simulations. You may have agents like Uncle Bulgaria which suddenly pops up and asks you if you want to read some related piece of dialogue. (Uncle Bulgaria is a software agent described in Masterton 1998.)
Interactivity with the teacher is another cost driver. Interestingly enough
Anna (6.2) said "It is funny, but for some reason is never occurred to
me that the amount of
communication provided by an instructor in an online or DE environment could
be a cost driver." In (5.3) she said. "There is no doubt that the
infrastructure and development of online material account for a huge portion
of cost." This is interesting since it shows that we think of costs often
in terms of objects rather than in terms of human resources. From the point
of cost structure human resource costs are less compatible with the cost structure
for which DE is highly valued (cf. Daniel's so called 'eternal triangles').
This is because the contribute to cost per students and tend to uppen aggregate
unit costs.
The discussion then came to discuss lurkers. In fact lurkers are welcome from a cost-efficient point of view. Rumble sometimes mentioned the idea that students may be asked 'to pay per question'. The idea is that a student who needs much support should pay more. You see commercialization encroaching in the core of the educational process. (I encountered the process of commercialization first when I did the MA at the IOE in London. Since I did my first degree in the golden age of the Humboltean era of the German university, I entered a number of courses for mere interest. I did all the paperwork with some success only to discover later that the institution wouldn't give me the credits since I didn't pay for the specific course. You see the difference: In the Humboltean idea of the university the student who entered the university was free to move around to sit in lectures and participate in courses according to his/her capacity. The more he/she would be able to learn the better. The commercial model does not allow you to milk the institution without having paid.)
In fact, it is difficult to negotiate where to draw the line. To which extent you expect me to get involved and to which extent you 'would hate me for' relentlessly driving the discussion and fueling the confusingly high volume of interaction. Should there be a flag calling for the attention of the professor and, unless no flag attached, the professor can lean bag?
There good reason to believe that the cost structure in Net-based learning deviates from the traditional cost structure. (Note that I distinguish Net-based learning from computer based-learning. The latter includes tools like interactive CD-ROMs, simulations and all this but not the live interactivity with the teacher.
The question is if there are not efficiencies in Net-based learning? Based on the OUUK model we have emphasized the importance of scale economies and warned against diseconomies of scope. In the discussion with Greville we found that the limitations in scope may limit also the attractiveness of dedicated distance teaching institutions (DTUs). My hunch is that Net-based courses can lead to the post-Fordist efficiencies we observe in the car industries. Modularization, reusability is a point in case. Much of the initial design investment is now available as a standard shell which can be used for various courses. You can disable enable various functions according to the pedagogical objectives. You cab parse from your digital libraries what you need for a course. (This does not mean necessarily SCORM as it was explained in the discussion. SCORM seems to go to much into detail and you get lost in a maze of objects.)
(There was an unexpected little subthread about 'Never take the first course'. Most of you agreed only daring Charlotte was happy to take it as learning experience. To some extent I agree though that you can learn possible more from bad course than from good ones would drive horses through all the traditional quality standards arguments.)
Here the discussion was based on the Whalen & Wright paper (1999). The main points I wanted to make is to draw attention to two aspects: (i) opportunity cost savings; (ii) time compression. The first is rather obvious, the second is rather doubtful.
Opportunity savings are made because of students or lecturers not having to travel anymore. If students travel at there costs may not be included in the cost sheet of the institutions. But if students are at the same time employees the may ask for being paid, and obviously there is the lost productivity due to the students/workers absence of work. I may well be worth to reflect on the nature of costs in this context. We think often rather straightforward in terms of money to be paid. But in fact you may not pay the workers extra for the training but you loose your time and that means an amount of productive output. Greville pointed out in a discussion with Robert, that employers tend to force employees to take the courses in their free time. (Possibly waving sticks or carrots: if you do this evidently you would qualify for moving to a higher position; if not you may be among the first loosing the job. It is not necessarily to express it; it is in fact implied in the logic of training as an investment.)
The above implies that if we have a method or a medium working like a Nuremberg Funnel and compress time it would be very good. Though several studies report compression time, this time I tend to be an ally of the media equivalence hypothesis. Training may be more skills oriented and less concerned with theoretical ornaments but this means that not only the time input is different but also the outcome. There was a discussion on training and I learned that training approaches are applied also for changing attitudes (for instance issues on sexual harassment). But probably it is quicker done to indicate what behavior is 'out' than to change attitudes (as opposed to behavior).
Thanks for having participated so actively. Partly I was overwhelmed to the extent I could not be involved to the extent I wanted to. But may be that left more space for the peer interactivity to develop. We will hopefully pick up some of the issues in the discussion with Tony albeit under a different perspective.
Kind regards
Thomas
__________________________________
References:
-- Masterton, S. (1998). The Virtual Participant: a tutor's assistant for electronic
conferencing. In M. Eisenstadt, Vincent, T. (Ed.), The Knowledge Web: Learning
and Collaborating on the Net. London: Kogan Page.
-- Whalen, T., & Wright, D. (1999). Methodology for Cost-Benefit Analysis
of Web-Based Tele-Learning: Case Study of the Bell. Online Institute American
Journal of Distance Education, 13 No 1.
Dear all,
This module looks at management rather than costing aspects. The course title has been changed into 'Management of distance education: Cost analysis'. This signals cost analysis is part of managing distance education. But we need to embed cost-analysis into awider perspective. This is what Tony Bates has successfully done in his book Managing technological change. He is our visiting expert during this module. In Main Topic 2 I welcome Tony and rather needlessly introduce him to an audience which is likely to know his work already quite well.
In Main Topic 3 I set out a framework for the discussionsuggesting that good distance education has to integrate three aspects: audiences, organizational models and technologies. Changes in technology trigger changes in the organizational models and may shift audiences.
Main Topic 4 gives the outline how to proceed. You are all members of a group which should focus on one chapter of the book and formulate as a group a small set of questions you then post to the main topic as Questions and comments to Chapter X (where X is the number of the respective chapter). Hopefully you can do it soon in order to profit fuully from Tony's presence as visiting expert.
The following six main topics Main Topic 5 - Main Topic 10 will be posted by the groups.
I hope It will work. I know that this is difficult for you but I also have quite some confidence in your ability to get something done quickly.
Kind regards
Thomas
Dear all,
the first thing I observed about Tony Bates that his publications were indicating him as "A.W.(Tony) Bates". It seems to be a sort of personal signature signalling a certain accessability. I saw it first on the famous blue Routledge book 'Technology, Open Learning and Distance Education', Routledge, 1995, which is a core reading for those who want to do research on costing educational media as I wanted to do when in 1997 joining the International Research Foundation in Open Learning in Cambridge (UK). This signature appears also on the new book 'Managing Technological Change: Strategies for University and College Leaders' published by Jossey Bass in November, 1999 which will be discussed in the course of our conference.
But I have digged out an earlier one from 1984 'Broadcasting in education' published by Constable where he appears not yet as A.W.(Tony) Bates but as Anthony Bates. The book has an interesting cover: in the middle of a village with roofs made of opened books (their covers showing some algebra, statistics or reading) stands a somewhat old fashioned radio tower with a doctoral hat obviously sending complementary wisdom to the Gutenberg village.
Why do I mention this? It shows that Tony's career spans a long range of technology including broadcasting and extending to issues of costing online education and training. Being an active participant in technological change rather than only an observer he is the very person who can credibly write on'managing technological change'. Let me just quote some biographical information from his website at UBC (University of British Columbia; URL: http://bates.cstudies.ubc.ca/bates.htm):
Tony Bates has been responsible since June 1995 for developing distance education programs and flexible delivery of credit and non-credit programs at the University of British Columbia, in conjunction with faculty and program directors. This includes the development of innovative off-campus programming using technology delivery. He is project leader for a national research study on cost-benefit analysis of telelearning. He is also a member of the Canadian Federal Office of Learning Technologies Advisory Network, and a member of the WebCT Board. Prior to moving to UBC, he was Executive Director, Research, Strategic Planning, and Information Technology at the Open Learning Agency of British Columbia, where he worked from 1990 to 1995. Before that, he was Professor of Educational Media Research at the British Open University, where he worked for 20 years, as one of the founding members of staff. His research groups at the UKOU, OLA and UBC have published over 350 papers in the area of distance education and the use of technology for teaching. He is the author of five books, including his latest, 'Managing Technological Change: Strategies for University and College Leaders' published by Jossey Bass in November, 1999. His previous book, 'Technology, Open Learning and Distance Education', Routledge, 1995, won UCEA's Charles Wedemeyer award for the best book on distance education published in 1995. versity of Portugal.
(My emphasis.T.H.)
We have so far looked at costing techniques and acquired the essential tools
of cost analysis. Then, lead by Greville Rumble, we looked at issues of costing
and cost-effectiveness of distance education institutions. Now we want to look
at 'managing technological change'.
I believe Tony is the person with the wide ranging experience which allows to
address these issues.
Thanks Tony for joining us.
You are very welcome. The classroom is yours.
Regards
Thomas
Dear all,
I tend to look at distance education as integrating
We can look at a concrete realization of DE as a point in the three dimensional space with the axis of audiences, organizational models and technologies.
The almost classical realization of DE is the open university. The audience is the adult learner; the organizational model is generally one of individual study of high quality resource material (such as study guides, cassettes, radio presentations) and tutorial support through occasional face to face lessons or through correspondence; the technology is mainly print with some additional radio and television.
The title of Tony Bates' "Managing technological change" seems to imply that the axis of technological change has a specific dynamic (it connotes Schumpeter's 'gales of innovative destruction') which needs to be managed. In the subtitle 'Strategies for college and university leaders', there is the reference to a specific organizational model (the university, the college). The idea implied in the title is that the dynamic of the technology axis puts the traditional organizational models under pressure.
There is some literature, which similar to Bates, writes the history of distance education as a history of successive generations of technologies (Nipper, 1989; Taylor, 2001). It is always the technology which seems to be the driving force. (There is a popular 'technodeterminism' implied here which sees history as driven by technological inventions. I don't want to imply that Tony would subscribe to technodeterminism as a doctrine. But I want to identify it as a doctrine since most of us tend to take it too much for granted. We use formulations like "moving towards an information society" which suggests that the only thing we can do is to find out how to accommodate to these changes.)
Other authors see distance education less determined by the technology axis. Peters in his initial description of DE includes technology in characterizing DE as 'most industrialized mode of teaching and learning' but he emphasizes more the organizational aspects than the technological ones (cf. Keegan, 1994). (This is no wonder since DE was largely print dominated at the time he wrote it (1967) even television as educational technology still in the offing.) We read Rumble on dual mode distance education (Rumble, 1992). Again, technology got only passing remarks.
Tony takes technology as the point of departure. He suggests that emerging ICT generates some pressure for changes in the organizational models. How is this pressure generated? I think by creating opportunity costs of not making use of the potential created by the new technologies for the mission of the organization. (Here is a problem of perception: university teachers may perceive the respective potential differently; besides some innovative 'lone rangers' they may see little potential; but it depends also on the perception of the audience, i.e. potential students. Here again the audience dimension comes in.)
What are these new technologies? Tony Bates includes e-mail, powerpoint, WWW, multimedia and CD-ROM. One might include more specifically learning environment (Learning management and content management systems like Lotus Learning Space, Blackboard, several open source learning platforms). Obviously these models can be used in various organizational models. Obviously you can use e-mail instead of letters without much changing your organization. However, Tony's question is not can you use these technology at all but does the traditional organizational model of a university (including traditional open universities (DTUs)) allow to fully exploit the potential opened by the new technologies.
Why these technologies create a pressure for change? Because they create a potential; allow to do things if fully used by this creating opportunity costs of not using them. I think we may need to read Tony's book to find out how to reduce the friction between the technologically created potential and the organizational model.
What is the potential created by the new technologies? You can use it in administration; to reach new learners; to enhance quality (by including simulations, inviting visiting expert of international level); to communicate without delay with students. (But note that technologies generally 'enable and restrain'; there are also costs of using these technologies. The losses are often related to spontaneity, community, trust etc.)
What are the changes in the organizational models required? That depends partly on where you are and where you want to go. It is the overlap between the potential created by the new technologies and what the institution sees as its objective what is important. This is why Tony insists of the importance of 'vision' (suggests even visioning exercises) to create a picture where you want to go.
Technology creates pressure for internal organizational changes. But technologies create also a potential for changing external relations (how to cooperate, compete, new audiences (markets); relations with governments and funding agencies. The potential in turn creates opportunity costs for not exploiting these options fully. Again there is much in Tony's book we can learn from.
We will proceed as follows: Each group reads a specific chapter and discusses it, possibly with my introduction in mind, and will ask three to five principal questions. The group posts about three to five questions as one main topic under the header: Questions to Chapter X.
I gave you some days more with the assignments and now hope that you can manage the task quickly. It is one chapter to read more intensively and to agree about the questions. I suggested Tony to delay his conference for a few days and he may decide to do so in this case we have a bit more breathing space. I will announce this as soon as I hear from Tony.
Kind regards
Thomas
_________________________________
References:
-- Nipper, S. (1989). Third
Generation Distance Learning and Computer Conferencing. Retrieved 09
19, 2001, from the World Wide Web: http://icdl.open.ac.uk/lit2k/external.ihtml?
-- Taylor, J. C. (2001). Fifth generation distance education. Paper presented
at the ICDE World Conference, Dsseldorf, Germany.
Peters, O. (1994). Distance education and industrial production: a comparative
outline (1967). In D. Keegan (Ed.), Otto Peters on distance education. The
industrialisation of teaching and learning (pp. 107-127). London and New
York: Routledge.
-- Rumble, G. (1992). The competitive vulnerability of distance teaching Universities.
Open Learning, 7(2), 31-49.
Dear all,
I hope you have the stamina to go on. Soon (28 April to 4th May) Tony Bates will be our visiting expert. I want each group to to the following:
Group 1: Module 5
Emeline E Briley,Kathleen M Bucco,Suzanne E Burk,Kristie Y Cannon,Christine
A Chilcoate
Chapter 1: Confronting the Technology Challenge in Universities and Colleges
To start you off: Bates (p.21) says that "(t)hese
new technologies are having as profound an impact on education as the invention
of the printing press." You may think about the relation
between organization and technology on a more abstract level. Technology is
often seen as a tool. The tool is often (rather naively) seen as something 'external'
to the user (not impinging on the user's identity). But if the user is an organization
this is often wrong. For effectively using a techology organizational processes
must be re-considered and re-configurated.
Group 2: Module 5
Bobbie J Dickerson,Charlotte A Donaldson,Hada Flowers,Sharon Gail Frizzell
Chapter 2: Leadership, Vision and Planning in a Post-Fordist Organization
To start you off: We could link much of what
Tony says to the discussion with Greville on his 'Vulnerability' article. You
may think probably think of Daniel's of the 'Mega-Universities' as Fordist.
But is the conventional university (transformed into 'dual mode') post-Fordist?
Why is a post-Fordist approach regarded as preferable? Which needs it serves?
(We may think about customization, just in time learning, sorter time to market).
Group 3: Module 5
Beulah Gaye Hartge,Christine Hill,Anna Christina Hopson,Shyamala Iyer,Rochelle
L Kamont
Chapter 3: Planning and Managing Courses and Programs
To start you off: Trying
to introduce e-learning within the university often leads to effects where the
younger technology oriented faculty members want to offer something of whichthe
tenured faculty does not see the sense (the
technologists offer a solution but the faculty doesn't have a problem). It is
easier to convince distance educators since they have in any case to teach with
some kind of technology. Tony includes 'aspects of quality'
(p.65). Would theysuffice to convince a traditional lecturer?
Group 4: Module 5
Momoe Miyagi,Jennifer L Parker,Bridget Powell,Charles P Pscherer
Chapter 6: Calculating the Costs of Teaching with Technology
To start you off: You may summarize the argument
that online teaching is more costly than say both conventional teaching and
correspondence teaching. I would suggest to explore with Tony here if he sees
potential for efficiency gains other than in terms of strategy. I would consider
issues of modularization and re-usability. Possibly the efficiencies lie in
the aspect of scope.
Group 5: Module 5
John Carleton Rogers,Pauline T Russell-Zolik,Cynthia B Schuster,David Ralph
Short,Grady M Sutton
Chapter 7: Funding Strategies, Collaboration and Competition
To start you off: This
seems to me quite an interesting issue. Where lie the efficiencies of collaboration?
It seems true that collaboration intensifies since the emergence of a global
information infrastructure. Remember your Macchiavelli and 'Never collaborate
with a bigger party' I heard recently. Is that true? (Bad auspices for the UMUC/Oldenburg
collaboration.) When collaboration should be considered and what to keep in
mind?
Group 6: Module 5
Kenneth M Tercero,Sally Warner,Robert H Welton,Laura M Wolanski,Lealan M
Zaccone
Chapter 8: Organizing for the Management of Educational Technologies
To start you off: Many
universities are unable to agree on a common learning management system or learning
platform. Some departments use Blackboard some WebCT. Why is it not possible
to make the different departments agree to join forces? Duplication of efforts
and wasting resources is often the effect.
Dear Tony and all,
The start was delayed for various reasons. The time may not have been chosen optimally since you had to go to Australia. But when Tony finally was able to connect he saw "OY! So Many Questions" (Bob, 2.10). And Bob continued:
"I counted about 30 questions that we had compiled from your book. These questions are kind of heavy-duty too, in that a simple Yes or No will not suffice for an answer. I agree with Thomas, I would be overwhelmed to have to answer them all in such a short time frame. Granted, you WROTE the book so it may be a "piece of cake" for you. This summarizing chapters as group work and then asking the author to answer critical questions is a nice approach."
If it was a piece of cake, I cannot say and I don't know to which extent serious academics take it as compliment to be referred to as an 'intellectual Oprah' (I couldn't find the initial posting on that but Beulah qualified "Tony-This is like an Oprah for MENSA viewers." (10.4.3) - Having no experience with Oprah I learned that she is known for captivating her audience. In this Tony, you certainly succeeded.
But a word of recognition also to the different groups which in short notice produced good questions and summaries, and during the time Tony could not login, took the initiative and discussed each others' questions. I asked for some questions to start a discussion; I got extensive summaries and elaborate questions that I almost feared that my visiting expert would be frustrated possibly not having set aside the time to deal with so much. But you did and did so marvelously.
Tony, thanks for the participation and your contributions. I have to read it
all through to produce my wrap up of the discussion. If, from 'down south under'
you still want to add your comments, please do so. But I want officially to
conclude, already too late, your conference week.
Thanks.
Regards
Thomas
Dear all,
This summary will give some preference to the groups questions and Tony's answers. However, I want to mention that we had an interesting discussion on techno-determinism. The discussion seemed to confirm that there are different perceptions of technology, one more 'technophil', one more 'technophob'. Americans are famous for embracing new technological options more enthusiatically than Europeans (what about Japanese, Momoe?). The intellectual discussion has favored for some time the social constructivist interpretation where society (both groups and individuals) influence the course of technology and shape it. Nowadays, for instance in Actor-network approaches, there is a tendency to attribute some form of agency to technology which as a configuration of artefacts orders ('polices') social processes. The interesting thing, however, is that those subscribing to technodeterminism also often regard technology is a mere tool and as such embrace it as an enabling disregarding the constraining aspects.
The interesting point relating to this course is twofold (i) Traditional DE is based on high upfront investment and low variable costs. The Achilles Heel is interactivty. To some extent interactivity can be driven by 'agents' which may be a substitution for real teachers. To the extent communicative functions, especially in HE, cannot be automated this perspective is limited. (ii) More Post-Fordist approaches emphasize ongoing updating, re-usability, - an approach discussed with respect to SCORM. This leads to the opposition of technology based on algorithms and has difficult to allow for contingencies.
In the following short account of the discussion with Tony, you may excuse that I focus on the guest and visiting expert when summarizing the various main topics.
Group 1: Module 5
Emeline E Briley,Kathleen M Bucco,Suzanne E Burk,Kristie Y Cannon,Christine
A Chilcoate
Chapter 1: Confronting the Technology Challenge in Universities and Colleges
The group expressed some deseperation of technology. There seems to be no end in sight. Tony agrees and compares technology to a river. (Interestingly you liked the metaphor. It emphasizes the independence of technology from our whims and wishes. Or is society the landscape determining where eventually the reiver takes its course?) John reported that institutions now increasingly want to get out of the river. (They tend to descend now and then to see of the river had carried something interesting to the shore.)
A further question related to the market capacity for DE. Tony emphasized that it is no 'zero-sum' game. There are different markets. Especially interesting is the lifelong learning market with 'second chancers' and 'career changers'. The latter group is paricularly interesting since it is less often subsidzed and providers can charge fees. However, to tap this market you need to have a good business plan and an institutional leadership that is willing to take risks.
About where we will be in 2013. According to Tony the tendency of teaching with technology is increasing. Hence DE audiences will increase. But especially mixed mode options will attract learners. Mixed mode provision requires more inovative and flexible management strategies
Group 2: Module 5
Bobbie J Dickerson,Charlotte A Donaldson,Hada Flowers,Sharon Gail Frizzell
Chapter 2: Leadership, Vision and Planning in a Post-Fordist Organization
The discussion was about Post-Fordism. I got a bit the impression that Post-Fordist is Pre-Fordist only that professors deliver digitally. Tony argues that it is difficult to change an existing institution - more than starting differently from the scratch. The problem is that there is no desire for change.
Planning and vision: According to Tony there is too much planning and too little vision. Planning you do when you have set your goals, but visioning is important to make you and your colleagues seeing/creating these goals. The problem is to make professors across the institution share a visioning process.
In the discussion thread on technology Tony suggests that managers' little daily prayer should be 'There is no silver bullet'. Consequently Tony emphasizes the role of human resource costs. Often ignoring such costs leads to adding to the tasks of the existing staff and leads to stress/burn out.
There was a question on types of chanes. Should we picture change as incremental or based on strategic planning? Tony tries to marry the both options and imagines 'planned incremental change'. However, there remains an irritation to which extent you can move from industrial to knowledge based organizations given that they are fundamentally different. (Are they? For me the underlying differences here were not yet spelt out clearly. May be they are not so different.) Tony admits that some of the rhetoric has softened.
Group 3: Module 5
Beulah Gaye Hartge,Christine Hill,Anna Christina Hopson,Shyamala Iyer,Rochelle
L Kamont
Chapter 3: Planning and Managing Courses and Programs
What would be a good job description for a manager in DE? (Tony talks not only of DE but of DE and e-learning within univeristies.) The managers he would look for are instructional designers (core qualification) who would be initiated in the rest of the tasks through an apprenticeship model (sitting with Nellie (?)). There they learn the admin skills, making budgets and handle large programs.
The continuum of management models is interesting: lone ranger, boutique, collegial materials development, project management. It all depends on the size and complexity of the task. Others added fromtheir experience.
Group 4: Module 5
Momoe Miyagi,Jennifer L Parker,Bridget Powell,Charles P Pscherer
Chapter 6: Calculating the Costs of Teaching with Technology
Tony reports that they calculate with about five years to break even. 20 enrolments a year make the course very expensive. But Queens University Executive MBA is successful with $70000 in tuition fees. (Wait for the Executive MDE!)
As far as the distinction between education and training is concerned: Tony believes that CBA (cost benefit analysis where outcomes are measured in monetary form) is not applicable to HE. He sees tree types of benefits: performance driven, value driven and value added.
Group 5: Module 5
John Carleton Rogers,Pauline T Russell-Zolik,Cynthia B Schuster,David Ralph
Short,Grady M Sutton
Chapter 7: Funding Strategies, Collaboration and Competition
Time to market depends not only on technology. Other factors take time. Creative processes for example ('Creative thinkers MUST waste time'). An interesting point on capital versus operational costs. Tony prefers to treat technology costs as operational rather than capital costs Infrastructure overheads are spread over courses or departments.
Partnerships: example UBC & Monterrey Tec. It is interesting that neither language not platform is a barrier. Core courses (four) are developed by both institutions jointly and available in two languages; two in Blackboard (Monterrrey's preference) and two on WebCT (UBC's preference). Electives are produced either in English on WebCT or in Spanish on Blackboard. Revenues flow where students go.
Different model in the UBC & OUC cooperation. Both institutions use English as language of instruction. Here markets split according to regions: OUC operates in Europe (and with a Spanish version in LA); UBC in Northern America.
A seamless integration between full synchronous technologies and Web based courses is not yet easy since bandwidth is still too low. As far as open source is concerned it would be an advantage. However, it is not only technology which is a barrier, arrogance, greed, and genuine cultural differences are even greater barriers.
Important avice on outsourcing: Tony recommends not to outsource core competencies or whatever you consider as core activity. If you want to become an e-learning institution, do not outsource the technology component. Generally, Tony is sceptical to outsorce the educational and instructional design component since teaching is a core activity of a university.
Group 6: Module 5
Kenneth M Tercero,Sally Warner,Robert H Welton,Laura M Wolanski,Lealan M
Zaccone
Chapter 8: Organizing for the Management of Educational Technologies
One of the fundamental question is the one of autonomy of faculty (especially tenured faculty) and cost-effectiveness. (Tony returns the question to the audience.) Given that teaching is a core activity and using technology for teaching becomes more and more important, the question is if tenured professors should be required to be able to handle these more complex teaching technologies. Tony is aware that tenureship is given based on research rather than on the basis of teaching but he thinks tenured professors should be required to be able to teach with technology. (The audience in the class , not astonishingly because of the pre-selection of being in this course, was in favor of making technology competence a requirement. The window of opportunity that 40% of the tenured staff retire in the next five years applies to the German situation too and probably to the European situation.)
SCORM: in principal commendable but Tony is not sure about this approach. Indexing is too complex and can only be automated in the more simpler aspects. There is no business model for the approach. Fundamental question of the contextual character of learning objects. (Plus copyright questions.)
Thanks for all the group members for having so quickly pulled the group work together. Thanks for Tony for not getting frustrated with initial difficulties of access and answering the question extensively and, judging from the echoes, to the satisfaction of all of us.
Kind regards
Thomas
