Is Education a Business?

Is Education a Business?

Written by Warren Edstrom of Knox County

When I was on the East Knox School Board I used to hear that the school system was not a business. I heard the same from the Ohio School Board Association, an association of school board members whose budget exceeds 30 million dollars a year.

When we went into financial emergency, we were assigned a receiver by the state board of education. When he came in to address the board at a public meeting I asked him “is a public school system a business”? He answered that a public school system had better be run like a business.

When you look at it there are many similarities between a business and the educational system. They both have a board of directors. They both have a CEO, the schools call them
Superintendents. They both have presidents of their divisions called Principals. They both have union employees that negotiate with management for wages and benefits, and they all have products and services –  educated students.

The big difference between these two forms of business is that in the private sector (non-
governmental) the product or service you are trying to sell must be high quality in order for you to survive. If your quality slips your competitors will take away your market share and you will go out of business. Companies have quality control departments to make sure quality is kept to a high level.  If the quality of a product deteriorates the company’s board will replace the CEO with someone who can get the organization back on track.

The public education system functions in a different manor in some respects. When negotiating a contract the private company has two groups at the table, the management and the union.  The management wants to hold expenses down (wages) in order to get good share value. They represent the shareholders. The union wants to get the workers the largest raise possible. They go back and forth until they come to some sort of accommodation, or worst case a strike is called, but they eventually reach an agreement.
In the end, the people who pay for the pay raises are the customers who now pay more for the product. If the increased cost is too much the company could lose customers and layoffs could occur, damaging both the company and the workers.

In a public sector (government) negotiation there are the board members, and the
superintendent on the management side and the union representative and teacher
representatives on the other side. The school board usually has the board attorney at the table also. Unlike the private sector who have shareholders who are looking to make a profit. The educational system has taxpayers who pay not only to run the school system but also have to pay for wage increases. They have no seat at the bargaining table as the company shareholders have. No one at the table is representing the taxpayers who will eventually be sent the bill to educate the children.

Another difference between the public and private sector is the quality of the product and how it affects the system. In the educational system, the product quality ( how well the children learn ) does not affect the funding of the school district; no one get laid off, no one gets a pay cut, the superintendent (CEO) doesn’t get fired . Poor product quality has no down side effect, except on the students who get a substandard education. In the educational system, accountability is not necessary to keep the system running.

A case in point is the above East Knox School System. For the last 5 years the state board of education has given the school district a “D” grade. This indicates serious problems in the system yet the Superintendent is still there and the teachers continue to get raises. There is no effort on the board’s part to replace the superintendent (CEO), although they should. School boards constituents should be the students and the tax payers. In too many cases they represent the teachers’ interests and the superintendent not the tax payers and students interests.

There seems to an acceptable rate of failure mentality in the system.

(LFC Comments: While we agree with Mr. Edstrom’s assessments, there are others we believe that are culpable in this on-going problem – State and Federal “educators” and the taxpayers that are paying for sub-standard results.  We do not necessarily fault the local teachers and local officials – although there are exceptions to that statement.

We believe that teachers are forced to teach with the goal of passing the constant State testing, and, therefore, their creativity as teachers is stifled.

The mandates of the Federal Department of Education promoting unworkable educational programs, such as Common Core; and State officials that encouraging schools replace the role of parents, all contribute to the poor results in public education. and ever-increasing costs.  The  taxpayers are also culpable for continuing to pass levies based strictly on emotion – “do it for the children” – without holding officials accountable.)



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