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James L. Wood
Chair, Department of Sociology
San Diego State University


Presented at the 71st Annual Meeting of
the Pacific Sociological Association, March 23, 2000,
San Diego, CA.


The Faculty, Strategic Plans, and the
Business Model for Higher Education

In C.P. Snow Revisited: The Two Cultures of Faculty and Administration (Wood, 1999), it was shown that a series of strategic plans for higher education in the 1990s created fundamental differences between the faculty and administration which have emerged to the detriment of higher education and the public interest. Responses by faculty and students to the problems arising from these differences were similarly discussed (Wood, 1999; see also Wood, 1998a; San Diego Union-Tribune, 1995; Snow, 1959). Although the strategic plans may seem to have been introduced independently of one another, ostensibly addressing different issues such as use of technology in higher education, meeting demands of student access to higher education, and the need to coordinate academic programs, the question is: where did all of these strategic plans actually come from? Examination of a recent book by Diana Oblinger and Anne-Lee Verville (1998), What Business Wants From Higher Education, will help answer this question.

It will be argued that these strategic plans come from at least two aspects of the “business model” – that is, the use of corporate principles -- that has been increasingly applied to higher education: 1) the business community’s desire to control higher education in order to make colleges and universities more receptive to immediate business interests, with teaching, research, and service to be of greater direct utility to business;

and 2) the high technology sphere of business being unduly influential in encouraging adoption of various strategic plans involving the purchase of expensive computer hardware and software. The two authors of What Business Wants From Higher Education are current or retired IBM executives, with university connections, who may particularly be representing the “high tech” sector of business.

This book -- which summarizes and promotes one form of higher educational planning in the 1990s -- argues that the business community perceives various deficiencies in higher education (apparently in spite of higher education’s many accomplishments, not the least of which is providing American business with a highly educated work force, as even they acknowledge [p. 23]). Due to these perceived deficiencies, Oblinger and Verville outline a series of changes desired by business that higher education is implored to adopt.

Indeed, higher education administrators have been hearing -- and responding to -- this kind of message throughout the 1990s in conferences ranging from the administrator-dominated American Association for Higher Education (AAHE) (Marchese, 1998) to the American Council on Education (ACE) --which sponsored the book-- to conferences organized by university and college chancellors and presidents. An analysis of the book will reveal that -- for reasons ranging from agreement with to resignation about or accommodation to the messages -- administrators have been adopting many of the principles of this book to re-shape higher education, thus increasing the likelihood of conflict between the administration and faculty.
This paper will:

    1) show a parallel between the strategic plans in the earlier discussion about increasing differences between faculty and administration (Wood, 1999), and the strategic plans Oblinger and Verville assert business wants higher education to adopt (it should be noted that the earlier discussion was written before reading the book, making the two discussions of strategic plans independent of each other);

    2) show that several of the strategic plans are aimed at weakening the faculty, and especially faculty shared governance of the university, which makes outside business influence considerably easier;

    3) raise questions if all these strategic plans for higher education are actually in the interests of business as a whole, even seen from a business perspective;
    and

    4) indicate that the technology sector of business may have unduly influenced university and college administrators to adopt strategic plans which emphasize the widespread use of -- and therefore widespread purchase of -- expensive technology in higher education, an institution which has a near-captive audience of 14.3 million students, and whose younger members alone are said to have a “projected $100 billion-plus annual buying power” (Oblinger and Verville, 1998: 31, 33, 135)! This amounts to enormous disposable income with which to purchase millions of computers and related software, in addition to a parallel number of them purchased by higher education institutions. Given the quick obsolescence of computers, this furthermore means the purchasing of new hardware and software indefinitely, with the accompanying millions of dollars to be made by technology corporations -- also indefinitely.

In the earlier paper on “the two cultures of faculty and administration,” ten differences between faculty and administration were discussed:

    1) “learning instead of teaching,” whereby distance learning -- learning from a physical distance -- is the model, with this view often coming from the same administrators who call for better teaching;

    2) “outcomes assessment” of learning, particularly the use of standardized, multiple-choice testing procedures devised by off-campus commercial agencies quite removed from college classrooms, similar to the organizations that produce tests like the Scholastic Aptitude Test (SAT) and the Graduate Record Examination (GRE), for mass distribution to distance learning (or in-class) students -- with this often coming from the same administrators who call for better writing from students;

    \3) the commercialization of the university whereby businesses are to play much larger and direct roles in universities than ever before while making large profits from universities, students, professors, and even alumni (this was the aim of the California Education Technology Initiative [CETI] from a business standpoint);

    4) the related commodification of higher education whereby “products” (courses) are “purchased” (through distance learning) for “consumption” (obtaining a Digital Diploma Mill degree);

    5) the loss of professors’ intellectual property rights over the courses they teach to maximize profits for others;

    6) the increasing reliance on underpaid part-time instructors instead of full-time, tenured faculty (part-time instruction has increased to over 40% for many American universities, a great disservice to students who need fully professional and committed faculty who will be around later to write them letters of recommendation for jobs and graduate school);

    7) the recent attacks on tenure which could greatly undermine the academic freedom necessary for universities to continue producing the great innovations in science, the economy, and technology itself (Finkin, 1996);

    8) the increasing control over universities by administrators who favor an imperial approach to higher education that stresses the above connected tendencies;

    9) the lessening control by departments when faculty hiring is based on administrative plans instead of departmental curricular needs; and

    10) the gradual elimination, or at least significant weakening, of targeted departments by administrative refusal to hire tenure-track faculty for any purpose.

As noted, this list was compiled before reading What Business Wants From Higher Education. Instead the list was derived from synthesizing a decade’s-worth of faculty experiencing these changes demanded by university and college administrations, changes often reported throughout the 1990s in The Chronicle of Higher Education (e.g., Selingo, 1999), as well as in major media such as the Los Angeles Times (e.g., 1992), Newsweek (e.g., 1992), CBS Evening News (e.g., 1998), and The New York Times (e.g., 1992) (Wood and Valenzuela, 1996, 1997; Wood, 1998a,b).

Recommendations of What Business Wants From Higher Education
What does the book recommend to higher education for enhancing its utility to business? A set of recommendations from the book that are closely parallel to the issues just discussed will be presented, along with a critical look at the recommendations. As will be seen, these are not incidental recommendations. The official journal of the American Association of University Professors, Academe, has recently taken a serious look at this type of recommendation along the lines to be discussed below (Bellah, 1999; Ohmann, 2000; Schrecker, 2000; see also Zappia, 1999), as have other recent books and articles with titles such as “The Kept University” (Press and Washburn, 2000) and The Edge of a New Dark Age: The Corporate Takeover of Higher Research and Education (McMurty, 2000).

Among its many recommendations, What Business Wants From Higher Education -- referenced by page numbers in parentheses below -- argues that:

    1) Higher education should now be “Learning Centered,” with Instructional Technology (“IT”) fundamentally changing the traditional “campus-centric model” of higher education to a model of higher education gleaned “from any location,” using advanced computer technology, the Web and Internet, and CD-Roms, all of which are parts of new “electronic communities” (p. 95). This kind of recommendation surely furthers the financial interests of companies like IBM by enabling them to sell millions of dollars of technology to thousands of colleges and universities, serving millions of students (pp. 31, 33, 152). But it is unclear why the rest of the business community would embrace this strategy. Business needs educated workers, but has no particular need that the workforce be trained through distance learning. This is especially the case since distance learning has many drawbacks, such as lack of direct interaction with professors and other students, that are positive attributes of traditional in-class higher education (Farber, 1998). Indeed, David Noble (1998 a,b) has shown that universities heavily relying on distance learning will become “digital diploma mills,” producing degrees that invite suspicion. Accrediting such degrees has become a national issue, with the American Association of University Professors’ Committee D (on Accreditation) raising serious questions about quality of distance education programs. Upon hearing about the presumed need to widely adopt technology to teach college and university students through distance learning at an administration-sponsored conference in 1990, it appeared to many in the audience that technology companies had strong profit motives in gaining support for this kind of higher educational strategic plan, regardless of the quality of education provided (Wood, 1997).

    2) The benefits of higher education need to measured by outcomes assessment of students’ learning because “Without measurable goals and outcomes, neither higher education nor its stakeholders can measure progress toward those goals” (p. 108). Indeed, “There are several opportunities for assessment: assessment prior to entering a course, assessment at the end of the course, certification of competency, and certification of degree completion” (p. 108). Why do Oblinger and Verville feel outcomes assessment is necessary? Because, they argue, business needs employees with “the knowledge, skill, and personal attitudes that will enable them to work in the present as well as the future organization” (p. 73). Furthermore, they assert that “Many executives complain that too many top-level graduates of business schools are good at analyzing textbook cases of business problems but are unable to come up with innovative ideas for new business products or services, or ways to stay competitive with similar industries in other countries… there are large gaps between the kind of performance needed for success in a business setting and the kind required for success in schools… ” (p.72). The book assumes that assessing the outcomes of student learning will ensure that these business qualities are learned in college, and later retained by the students for use in business. The authors present little actual evidence for this key assumption. Especially problematic is the undocumented ability of outcomes assessment to measure creative ideas desired by business.
    Finally, it should be noted that the recent focus on assessments is part of an “education reform” agenda which demands widespread educational improvements without providing necessary additional funding to accomplish this goal. The use of assessments can therefore appear to be educational “reform” without paying for it. However, the actual occurrence of such widespread educational improvements is quite doubtful: a story on the front page of the Los Angeles Times (2000) even argues that assessments can impede learning since, among other reasons, assessments force faculty to “teach to the [objective] test,” not develop the creative thinking in students that business is purported to want.

    3) Universities and colleges should form more “strategic alliances” with business. The book states: “Higher education should establish strategic alliances with potentially important future suppliers -- hardware and software vendors, telecommunications companies, publishers, and others…. Strategic alliances among higher education institutions will become increasingly common in the future” (p.146). It might be noted that one colossal failure of such a scheme was the California Education Technology Initiative (CETI), a proposed $300 million deal over several years between the California State University (CSU) system and four corporations: Microsoft, GTE, Hughes, and Fujitsu. Seen as a takeover of CSU by business, the faculty, students, and staff of CSU -- with the assistance of corporations not to be included in the deal, and the Legislature which held a dramatic, standing-room-only hearing in Sacramento -- rallied to help end it (Wood, 1998c).
    A further examination of the kind of businesses with whom universities and colleges are urged to seek “strategic alliances” can be instructive. “[H]ardware and software vendors, telecommunications companies, publishers” -- and a vaguely stated “others….” The three types of companies specifically listed here would all benefit from universities purchasing millions of dollars of computer hardware and software, just the kind of financial arrangement of great interest to technology-oriented companies.

    4) Commodification of higher education is recommended in several ways by Oblinger and Verville. First, if not foremost, is that students are now referred to as “customers”: in the index, under the term “Customers” it says “See College students” (178). Likewise, the entirety of Chapter 3 is devoted to “Profiling the Customer.” Indeed, Oblinger and Verville make the same connection made in the earlier paper between the customer conception of students and the shift toward “learning-centered” institutions. They say: “Why are colleges and universities changing from an institution-centered to a learning-centered environment? Because… it is consumer-oriented” (p. 96). As those in business know, customers need to purchase “products,” which in this instance means a college or university education. This also means “Learning will occur whenever students can connect to the World Wide Web,” making “campus-centered” education obsolete (p. 99). These higher educational products come at a “cost,” which is tuition and related educational expenses such as the need to buy computer hardware and software. Whereas the university receives the tuition, financial outlays for computer hardware and software go to technology companies like IBM and Microsoft. One of several problems about the CETI arrangement noted above was that universities, students, faculty, and even alumni were to purchase and use only certain computer hardware and software, raising the issue of monopoly, which has followed one of the CETI “partners,” Microsoft, and its founder, Bill Gates. The end result here is that millions of students, by this model, would be receiving what David Noble (1998 a,b) has called “Digital Diploma Mills” degrees.

    5) In his important discussions, Noble (1998b) has raised the issue of importance of intellectual property copyrights over courses remaining with the faculty in order to slow down the above tendencies toward commodification and commercialization of higher education. Oblinger and Verville have somewhat different ideas. Whereas they are less dogmatic on ownership of intellectual property than on several other principles, they nonetheless casually refer to teaching on a “work made for hire” basis wherein the university or college automatically owns the professor’s course when it is developed as a work made for hire (p. 151). However, their main concern here is professors working with universities other than their own. The underlying assumption of the need for “deregulation” of higher education (p.152) -- connected to “free trade” philosophy -- may make them less sure of who should own professors’ courses since the professors, after all, created the courses even if assisted by universities. Oblinger and Verville conclude (p. 52): “most of us are still unsure how to handle quality control and intellectual property management in a medium where one can be a producer as well as a consumer.”

    6) Oblinger and Verville (pp. 40-41) acknowledge -- without concern about quality of education -- the large increase in part-time faculty appointments, arguing there is no need for all students to have full-time, tenured or tenure-track professors teaching them (pp. 41, 148-149). Indeed, they refer to the “Decline of Full-time, Tenured and Tenure-track professors” and to the “Increase in Part-time Faculty,” stating that “approximately 35 percent of all faculty are part timers, and more than one-third of the full-time faculty hold term appointments” (p. 40). They indicate that “The traditional faculty ranks may constitute half (or even less) of the profession” (p. 40). Furthermore, they seem to approve of “The new and growing middle category of full-time but non-tenure-track faculty…” (p. 40), which is an interesting choice since it addresses the criticism of unattached part-time faculty, but still supports significant weakening of faculty shared governance of the university. In this regard, business should ask higher education leaders why they are supporting policies such as attacks on tenure and reliance on low-paid, insecure part-time faculty, which make a career in higher education unappealing to a younger generation of scholars who would otherwise contribute to the next series of intellectual and practical accomplishments. To borrow a phrase from the widely-distributed critique of American high schools in the 1980s, A Nation at Risk (1983), it is as though American higher education is currently being organized by a foreign enemy.

    7) The increasing proportion of part-time faculty is connected to another policy Oblinger and Verville support: the abolition of tenure for the faculty. They state that “Probably the most visible, incongruous college and university policy to the outside world is tenure. It is under fire across the country. Many view tenure as the single biggest impediment to change in higher education. The tenure system is regularly blamed for many of the perceived ills of higher education…” (p. 151). They even argue tenure is “contrary to the notion of serving customers” (p. 151), going back to their market model of higher education, even though the many benefits of tenure to higher education and the general public have been repeatedly shown (Finkin, 1996; Sociological Perspectives, 1998:4). Oblinger and Verville’s (pp. 159-164) calls for a “Culture of Change,” “Need for Leaders,” and “Transformations” all point to attacks on tenure in order to weaken the faculty role in governing the university. This is a position of which the faculty must become aware and organize to meet (Kuchta, 2000). Organizations such as the American Association of University Professors (AAUP) (2000), the California Faculty Association (CFA) (2000), and the Faculty Coalition for Public Higher Education (FCPHE) (1999) are addressing this national issue, and it has been the focus of recent academic meetings -- such as several recent sessions at meetings of the Pacific Sociological Association organized by Georgie Ann Weatherby, and similar sessions such as a focus on academic freedom and tenure for the American Sociological Association’s 2000 millennial celebration meeting -- as well as published discussions such as Matthew Finkin’s (1996) The Case for Tenure, and several articles for the Special Issue on “The Academy Under Siege” of Sociological Perspectives (1998:4). Again, the business community should be insisting on increased quality higher education by supporting increased full-time, tenured and tenure-track faculty instead of lower-paid part-time, temporary faculty. Most of the successful business leaders were themselves educated by the former type of faculty, often at prestigious universities, and thus they should recognize the need for a continuance of this kind of quality higher education.

    8) The attacks on tenure, support for non-tenure-track hiring of faculty, and acceptance of an increasing part-time faculty all point to the book’s support for increased administrative control. In their conclusion to the book, they cite former CSU Chancellor Barry Munitz as arguing higher education needs more administrators that understand the business model for higher education and are able to enact the business-oriented practices discussed here. He asserts (p. 164): “The only way we will have leaders who are imaginative, courageous and professionally trained will be to depart from higher education’s traditional view of presidential responsibility as ‘the last bastion of amateur management’.” The group responsible for bringing about all of these changes, from Oblinger and Vervill’s standpoint, are these exact same “courageous” administrators to whom the book is principally addressed. The authors will likely be comforted by the rise of Ed.D. degrees in “higher education administration” which constitutes a significant break with the academically-oriented Ph.D. degrees held by the most famous university administrators such as Clark Kerr, formulator of the extremely influential California Master Plan for Higher Education.

    9) The department has been the main organizational focus for academic hiring, retention, and planning in most colleges and universities. Instead, Oblinger and Verville would prefer academic decision-making regarding hiring and related issues to be made by the administrators who directly take business interests into account when making such academic decisions (pp. 65, 151-152, 163-164). They indicate, “Reengineering is the order of the day” (p. 5). They even strongly imply business should help hire faculty (pp. 94, 148-149). In discussing such business needs as training college graduates who can fit into the emerging global economy, Oblinger and Verville assert (p. 66): “American faculty are… unenthusiastic about internationalizing the curriculum… it may be difficult for globalization to penetrate higher education.” Why is this so? Because “teaching, learning, scholarship, and service [are] highly dependent on the experience base and attitudes of the professoriate…” (p. 67). Thus, the administration needs to overrule these faculty tendencies -- real or imagined -- and hire the faculty to implement the policies of business advocated in this book. Interestingly enough, business leaders do not want all of higher education to be turned into business colleges -- they even value the breadth of experience characteristic of college graduates (p. 25) -- but implementing recommendations like the ones above will likely lead to such a result, creating an ultimate commercial university.


    10) Finally, the book implies getting rid of, or significantly diminishing, departments that are unproductive for business (pp. 62-66, 145, 151-152, 161). They question what a Bachelor’s Degree “certifies” these days (p. 109), and instead call for “accountability …to measure [students’] performance…” (p. 153). It is instructive what is not called for: faculty scholarship and development is de-emphasized in importance even though that is one of the most important focuses for strengthening academic programs (p. 161). Instead they argue, “Demands for increased productivity arise from the common perception that faculty do not teach enough, students do not learn the right things, and administrators are reactive ‘firefighters’ instead of effective managers” (p 153). They feel administrators, drawing on an unregulated environment, should move to “add value” -- yet another business term -- to the curriculum by instituting the skills business needs (Chapter 2).

They finally conclude this line of reasoning with a threat: to receive necessary funding higher education needs business support, which will only be forthcoming when higher education makes the drastic changes business considers appropriate (p. 142).

Summary and Conclusion

In conclusion, What Business Wants From Higher Education summarizes -- and promotes -- the many trends shown in the earlier paper which focused on the increasing differences between faculty and administration. At least two aspects of the business model for higher education -- increasing business control over the university, especially by the “high technology” sector -- are central to the book, which argues the need for instituting these divisive tendencies in higher education to support business. More generally, the collapse of the Soviet Union has ushered in a perceived triumphal capitalism which has decided to exert its influences everywhere, including the university. The university has often pointed to the problematical effects of an unbridled economy on other groups and institutions such ethnic minorities (Cox, 1948; Blauner, 1972), the poor (Piven and Cloward, 1971), and the federal government (Domhoff, 1998). Now the academy must deal with similar effects on the faculty, students, and staff in higher education, while drawing upon earlier warnings (Bowles and Gintis, 1976; Ovitz, 1993).

Although the book is dedicated to gaining business control over higher education, many of the talents the authors say business wants from college graduates are already obtained in a liberal education: critical and analytical thinking, problem solving abilities, written communication, oral communication, interpersonal skills, including working with those of diverse backgrounds, knowledge of PCs, computers and technology, ability to analyze data, leadership, and creativity (Chapters 2, 6). Given the importance of a liberal education (Bellah, 2000) -- even when it is not directly connected to immediate business interests -- the academy now finds itself in the ironical position of having to “save business from itself” by resisting these business demands on universities and colleges (Wood, 1998a). The future of higher education depends on the outcome of this struggle.

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