Repair or Replace

The newspaper and book businesses have been transformed in recent years. But not education. After a 30-year school reform movement, no major urban school district in the country has been successfully turned around. Meanwhile, despite loud and persistent criticism from government, media and families, the cost of college continues to rise faster than inflation and student loan debt is ballooning. So why hasn't education changed?

This nation is making a transition from a national, analog, industrial economy to a global, digital, information economy. All of our social institutions — not just education but also government, media, health care and finance — were created for the former. The result is that they work less well than they once did. They seem to be broken and need to be redesigned for a new era.

The redesign is happening in two ways: through repair, attempting to fix the existing institutions; and through replacement, creating new institutions to take the places of the old ones.

Repair has been the primary mode of change in the nonprofit sector — heavily regulated, provider-driven institutions like schools and colleges, where the institution determines what the consumer receives, what students must study in order to earn a diploma. In contrast, replacement is more likely to occur in for-profit and consumer driven institutions, in which the user chooses what products to consume and there is money to be made by entrepreneurs who successfully develop alternatives. The news media and bookstores are excellent examples — businesses in which the user determines what to read, hear and watch.

In media, repair efforts by the major newspapers and magazines were generally too little and too late. The rapid emergence of the internet and cable news spawned an array of popular alternatives or replacements — such as Yahoo!, CNN, and The Huffington Post, as well as many others that failed. Between 1990 and 2012, daily newspaper circulation dropped by more than 30 percent. Perhaps most telling: In 2011 The Huffington Post sold for $315 million. Two years later, The Washington Post was purchased for $250 million and The Boston Globe was acquired for $70 million. Adjusting for inflation, the sale price of the two traditional newspapers, combined, was still less than that of The Huffington Post. 

In the book business, the independent neighborhood bookstore was largely replaced by megastores like Barnes and Noble and Borders. They were in turn replaced by the online bookstore Amazon.com, which offered major discounts on books and developed a new book format, the e-reader. Today Borders is out of business, Barnes and Noble is reeling, and Amazon has expanded its business to become a major retailer in many fields.

The measure of success in these two industries — news media and bookstores — has been profitability or potential profitability. However, the replacements also share several common characteristics. In comparison with the existing organizations, they are faster, cheaper and more easily accessible. They "have on their shelves" a much larger selection of content and titles, even highly specialized. Because they are digital, they are available any time, any place. They are more consumer-driven than their forebears, allowing users to customize content and, in many cases, to access it without any mediation from the provider. These are the features consumers chose over the existing models. They point to the qualities consumers are coming to expect and demand in all the institutions they deal with.

In this new, increasingly consumer-driven world, educational institutions — which, like government and healthcare, are historically not-for-profit, producer-driven, highly regulated, and repair-oriented — have been the most resistant to change and the slowest to act.

However, history teaches us that no major social institution can escape adaptation. When the United States made the transition from an agrarian to an industrial society, the same process of repair and replace occurred. The nation became impatient with those institutions that refused to modernize.

Medical schools were an excellent example. Dissatisfaction with the quality of doctors and their preparation mounted until early in the 20th century when states and the American Medical Association responded by raising and modernizing standards. Poor medical schools were closed. Investments were made by philanthropy and states in enhancing strong schools and creating new ones.

This is what can be expected in education. Dissatisfaction and anger over the current state of affairs is growing. Confidence in the capacity of the existing schools to improve is declining. There is a generational divide on how to respond. Older adults, who remember when schools worked better than they do today, tend to favor continuing to repair them. They are more likely to believe that the institutions they grew up with can be restored. In contrast, younger adults, for whom the schools have always seemed broken, are more likely to embrace replacement.

Younger adults are the future — as consumers of schooling, leaders of schools and educational policy makers. If the schools prove unable to repair themselves, they are likely to be impatient and demand replacement. This suggests that the schools still have the opportunity to choose repair, but the clock is ticking.

There is another caveat here. Although the existing institutions have not changed as quickly as they need to, they also embody features that the nation cannot afford to lose but are unlikely to be embraced by replacements because they are unprofitable. Two examples would be basic research, which is far more expensive and risky than other forms of research, and low-volume, high-cost doctoral programs such as physics. The nation desperately needs these functions, and our future is dependent upon doing them well.

The process of making all these nuanced and necessary changes can be accelerated by applying the interventions that transformed mass media. Foundations and other philanthropists have the capacity to spawn replacements which are more accessible, effective, cheaper and capable of being customized. Venture capital can invest in potentially profitable versions of not-for-profits that generate revenue by cutting costs and growing their consumer base. States can eliminate regulations that bar quality innovation and protect schools from making needed changes.

Both kinds of change are already occurring in education today. The result is increased competition and growing pressure on existing institutions to transform themselves. In higher education, the most recent example has been the rise of MOOCs — massive open online courses, which may be no more than a fad, but are causing existing universities to rethink their digital futures and launching a number of online education businesses.

Still, piecemeal changes and a focus on the flavor du jour will not serve education well in the long run. The time is now to consider carefully how all our educational institutions need to change, what must be preserved and what must be updated, to choose what to repair and what to replace, and to invest our time, energy, resources, and social capital accordingly.