A New Lesson for eLearning Programs:
The recent state of the economy has led to some challenging times in
higher education. The turbulence of the stock market coupled with challenges
of student recruitment and increased competition have some colleges and
universities actively seeking ways to increase revenue. Those programs
with an online presence have the option of exploring untapped markets
online. How much entrepreneurship should there be in eLearning?
While the idea of opening new programs might seem like taking your chances
in an already up-and-down economy, consider that from June 2001 to June
2002 the S&P Index dropped 19 percent while the online programs tracked
by the Chronicle Index of For-Profit Higher Education rose 16 percent.
And today more people are going online. More homes have Internet access
than ever before, with a potential growth area in home networks. Given
these trends, there are benefits to be gained by taking some controlled
risks.
Thinking Entrepreneurially
Entrepreneurship is not the same as throwing darts and hoping for the
best. It is about planning and taking calculated risks based upon knowledge
of the market, the available resources or products in a usable or close-to-usable
form, and a pre-determined measure of the potential for success.
It would be financially risky for a program with no experience in online
learning to suddenly decide there is money to be made and jump into the
market with little planning or product. Conversely, established programs
that can repurpose existing online materials to capture a small market
segment as yet untapped can reap legitimate benefits. A specific example
of this would be a program offering online degrees or degree completion
to repurpose its content into smaller components in order to remediate
students online for other colleges or universities. While this might not
be a large financial gain, it provides increased revenue for minimal work,
with nothing being developed from scratch.
Being entrepreneurial is about capitalizing on the strength or expertise
of an organization and leveraging that to some gain. The gain usually
is financial, although other advantages exist as well. Take the above
example of a program that is remediating students online for other institutions.
This could bring attention, research opportunities, and recognition to
the entrepreneurial program due to its innovative applications of technology
and online content that might previously have gone unnoticed. Thus the
act of entrepreneurialism may lead to both direct and indirect benefits,
neither of which would have occurred if the organization had not considered
trying something outside of its normal business practices.
Considerations for Entrepreneurial Initiatives
-
Take chances when warranted and do not be risk
averse
-
Know the market before you act
-
Plan first, act second, but definitely act
-
Be prudent, practical, and use common sense
-
Measure gains versus predetermined projections
-
Utilize existing online resources for another
purpose to minimize the work involved
-
Think outside of the box and be creative
-
Keep a portion of the revenue where the initiative
began to generate future entrepreneurial spirit
-
Realize that there are non-financial gains
to entrepreneurial activities
|
Another strategy is to consider new audiences outside of the original
scope of the offering, such as using online materials developed for synchronous
instruction for one audience, and broadening the market to include others.
For example, an online program for pharmacists could partner with a provider
of continuing medical education to offer content to physicians as well.
As one might guess, these ideas suggest that outside-of-the-box thinking
needs to take place, as opposed to the normal progression through the
traditional academic model that can sometimes be slow to change. This
means being risk willing as opposed to risk averse. While it is unwise
to enter the eLearning marketplace recklessly, it is appropriate to be
aggressive where warranted—and to not sit back and have a lengthy debate
on what to do and how to do it. The “best of intentions” d'es not move
the process any faster, and can cause an organization to miss a unique
opportunity.
Measuring ROI
It is important to understand that being risk willing d'es not override
being prudent, practical, and exercising common sense. For example, it
might make sense to enter a new market in which your institution can capitalize
on minimal competition and generate good, if not substantial proceeds.
That way, the program is generating revenue that can be used for other
purposes, and doing so via minimal changes to its existing eLearning content.
Something that might hamper program development is the amount of funds
retained after the revenue is distributed across the university. Consider
the example of a department generating roughly $50,000 in revenue via
its entrepreneurial venture but then having to turn back a percentage
or overhead of 30 percent to the central administration. Now, instead
of $50,000 in revenue, the venture has generated only $35,000, out of
which the operating expenses must still be covered.
In both of these examples, the potential bottom line could be small enough
that the prudent decision would be not to create the work for such a small
return on investment. That by no means suggests that supporting the campus
collective should be avoided. On the contrary, each program is part of—and
contributes to—the university community. But in some cases, the final
numbers may simply not support the initiative.
Reaping the Benefits
First and foremost is the opportunity to raise alternative sources of
revenue for departments or programs that might have otherwise settled
for less than optimal budgets. While not every institution of higher education
may be experiencing a tightening of the financial belt, it is safe to
say that few colleges or universities would turn away from the chance
to raise additional funds that are ready to use as they come in.
The challenge is that this revenue, if based on short-term contracts
or episodic content sales, is difficult to plan into revenue projections.
That in itself limits the usefulness of the funds generated, though there
are some very good and useful ways the funds might be used. It is important
to remember that the revenue should be used, to some degree, to benefit
the personnel or program that put forth the time, the effort, and took
the risk for an entrepreneurial venture. The rewards serve as an incentive
for future entrepreneurial initiatives, both in that department and on
other parts of campus once others see what took place. For example, the
additional revenue could be used to supplement cuts to institution-sponsored
research, faculty or graduate student travel, student help, or purchases
of software or hardware. Another way to achieve this is to start the entrepreneurial
venture with a particular goal in mind, such as software upgrades or a
new server.
Taking the initiative and being entrepreneurial is not without some inherent
risks, but if done with due consideration, then success should result.
Taking a chance is truly only a chance if no thought or planning is involved.
