Higher education in a changing economy

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Book Reviews

us all In the Company of Educated Women and it is splendid company indeed, CI.AUI)IA GOIDIN ttarvard University

Higher Education in a Changing Economy. KATHARINE

H.

HANSON

and

JOEL

W.

N e w York: MacMillan Publishing, 199{). viii + 142 pp. Price: U.S. $27.95 (cloth) MYERSON ( e d s ) .

THIs volume contains papers presented by three economists at a symposium sponsored by the Consortium on Financing Higher Education (COFHE) (which is an organization of private higher education institutions), and Coopers and Lybrand (C & L) (a major international accounting firm). The book is part of the American Council on Education/MacMillan Series on Higher Education, and is intended for an audience of trustees, presidents, deans, and treasurers of colleges and universities and for government and other leaders and policy makers as a resource in short- and long-term planning, C O F H E and C & L organized the symposium that is the basis for this book with the dual purposes of assisting colleges and universities to understand better the relationship between the macro economy and higher education, and of assisting higher education institutions in preparing for changes that likely will impact their academic and economic health. To understand what trends and changes are occurring, the most valuable component of the volume is the Appendix authored by Carol Frances. Hopefully, this document was available to the symposium participants before their discussions because it contains helpful information on key economic indicators ranging from the gross national product to returns on investments in college education. An understanding of these key economic indicators is critical to any higher education phmning exercise, Lawrence Lindsey, professor at Harvard; Richard Eckhaus, professor at Massachusetts Institute of Technology; and Harold Shapiro, President of Princeton, each presented papers at the symposium. Four panelists moderated by Derek Bok, President of Harvard University, discussed themes that emerged from the presentations, Bruce Johnstone, Chancellor of the State University of New York: Stephen Lewis, ,It, President of Carleton College; William Massey, Vice President of Stanford University; and Richard Spies, Vice President of Princeton University, comprised the panel, Lindsey espoused the view that the move to economic individualism would lead many colleges to be responsive to consumers (i.e., students) in order to survive. Liberal arts colleges that teach the thought processes needed when decision-making power dew~lves to individuals should benefit the most from the trend to economic individualism,

in his view. Lindsey held the most optimistic view of the economy, and appears to believe that supply-side economics is the answer to any fiscal crises universities may face in the near future. He also proposed changing the status of colleges and universities to that of taxable corporations, a proposal that would not be received kindly by most public university administrators, trustees, and state legislators. Eckhaus explored the implications of changes in demography and the macro-ecom)my on higher education. Although the U.S. ecom)my appeared strong, Eckhaus noted signs of decline under the aggregate numbers. He also discussed the pressures of large numbers of foreign students in graduate programs, and outlined a model for a

theoryof finance and expenditures for higher education. He then concludes, unfortunately, that under general budgetary stringency, colleges and universities will try to spin off their non-teaching functions. This conclusion seems to arise from a lack of understanding of the joint products of the university: research, public service, economic development, and teaching. All are inextricably linked; improved productivity in one area leads to improved productivity in at least one of the others. Shapiro directed his remarks to the impact of recent scholarly and technological developments, their cost, and the capacity of colleges and universities to accommodate changes within current institutional forms and commitments. He highlighted the tension between teaching and research obligations, and posited that undergraduate education has "gotten in the way" of cutting-edge research. Shapiro concluded that serious attention must be given to enhancing the productivity of higher education and to new and imaginative approaches to setting priorities. The panelists, led by Derek Bok, all raised questions about the adaptability of institutions of higher education to changes in the environment and to calls for stabilizing costs and raising productivity. All participants appear to have concluded that a workable economic theory needs to be developed to predict how higher education will respond to changes in the economic enviromnent. To be sure, higher education policy makers will find the forecasts and interpretations provocative and somewhat valuable in beginning a discussion of the future of institutions. The book will be of more value to those associated with private colleges and universities, as could be expected, because discussion of issues related to the political economy of public higher education is limited. The panelists and symposium participants did not appear to discuss the relationships between the non-teaching revenues and expenditures of institutions; this is a serious drawback, since over 5(}% of revenues are derived from non-instructional sources in most research universities. The lack of an economic theory to act as a framework in establishing priorities and planning in higher education limits the usefulness of this volume. It is unfortunate that none of the distinguished economists participating were specialists in the economics of higher education, and that only Johnstone represented the public sector of higher education. A well-developed theory of the economics of higher education could have served to focus the discussion. The absence of a foundation in an economic theory appropriate for higher education implies that this book will

Book Reviews be outdated quickly since changes in the economy occur swiftly, MARY P. McKEowN

Arizona Board of Regents

On Q: Causing Quality in Higher Education. DANIEl. T. SEYMOUR. Washington, D.C. American Council on Education and Macmillan Publishing Company, 1992. xii + 196 pages. Price: U.S.$27.95 (cloth) "l'H.s is not a research monograph. Instead, it is a prescription for what the author feels ails U.S. higher education institutions. Mr Seymour is a consultant to both higher education and industry and has worked in several institutions of higher education as an administrator. This book is a look at higher education through his experiences as well as his expertise in the area of Total Quality M a n a g e m e n t (TOM). The main emphasis of the book is that institutions of higher education (hereafter, IHEs) need to look at the student as a customer who will be lost if not well served and well treated, It is clear to those who work in the IHEs that student service has not always been the first priority, In fact, it sometimes seems as though the student is tolerated as a necessary evil the institution has to endure on its way to maximizing benefits for either faculty or administrators. Seymour suggests that many of the problems facing colleges and universities derive from that attitude, It is certainly the case that the market for higher educational services will not rise to the extent it has in the past. If colleges and universities are to continue their past success, they will need to adopt some of the precepts adw~cated by Seymour. His emphasis is on adopting the same dedication to quality which has characterized the more successful businesses in the recent past. His book is an attempt to show how quality can bc achieved in the college or university, While the IHE is different than the typical business, it is still similar m many ways. Many of the readers of this book will find thai it challenges their basic image of the college or university. Seymour treats the IHE as a business which has to attract customers, both students and others who provide the wherewithal to continue the institution. If the IHE does not well serve its customers, they will leave either to go to a compctitor or will leave higher education entirely. There arc ten chapters in On Q. The first attempts to document the need for attention to quality in higher education. A n u m b e r of examples from business and industr'~ are given to show the need and what it can mean for the firm adopting T Q M principles. Seymour gives cloven principles defining quality in this chapter which are worth repeating here. They are: Quality is I. meeting or exceeding customer nceds, 2. cverwmc's job, 3. con-

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tinuous improvement. 4. leadership, 5. h u m a n rcsource development, 6. in the system, 7. fear reduction, 8. recognition and reward, 9. teamwork, 10. m e a s u r e m e n t , and I I. systematic problem-solving. While these may seem self-evident or trite, Seymour makes it clear that higher education is failing on many of these dimensions. Chapter two emphasizes the m a n a g e m e n t of quality on campus. The achievement of learning at an appropriate cost level is the outcome stated as desirable. There is little coordination of the production which is supposed to go in the college or university and the faculty are satisfied if their course is taught well. Since the students and other supporters of education will not be satisfied with such a disjointed product, the institution should not be satisfied either. Chapter three discusses customer satisfaction. The quality of the experience of the student and whether that student gains from the experience are paramount in this view. There must be a reason lk~r the student to attend the particular institution and that reason is largely the value added by the institution. At the same time, Seymour cautions that there are many little things that colleges and universities do which may add or detract from student satisfaction without much effect on learning. However, such minor problems as difficulty in registration may cause enough dissatisfaction to lose customers. The fourth chapter is on being distinctive. While perhaps obvious, it bears repeating that colleges cannot be good at everything: they need a locus. Priwlte colleges and universities have probably done this better as a matter of surviwll. However, Seymour argues that the public universities also need to focus on doing a few things well. Chapter five is devoted to the processes used in the institution for achieving quality. Seymour argues that far too much time is devoted to solving problems as they arise rather than establishing processes so as to avoid the problem occurrence in the first place. Hc also argues that satisfactory procedures aren't satisfactory: the process of improvement must be continuing. In the sixth chaptcr, Seymour wants the administration to act so as to inw)lve everyone at the college or university in the continuing pursuit of excellence. Of course, most faculty view themselves as active decision makers who are involved ill the quest for quality, but often they arc actually left out of the decision process or choose to inw~tve themselves only in their own discipline. Seymour does not really offer any prescription here for solving that problem, Seymour argues in the seventh chapter that what is needed is pride in the product. He states both that a quality product develops pride and that pride results m producing the quality product. Giving rapid feedback to faculty on how wcll they havc done in teaching is vicwed as central to allotting them to use their pride to improve quality. Chapter eight is dew)ted to developing an attitude thai, however well anything has been done in the past, it can be improved. He points to the high cost of college dropouts, both to society and to the college or university. These are people who are likely to be hostilc to the institution which has failed them and will be less productive in society as a result of dropping out. (If wc don't believe that. vvhv are we in the business?) In ('hapter nine, Seymour argues that the firm, college,