Student Value for Money and Ice Cream

How on earth can Business Schools offer Value for Money (VfM) to students when the "Money" part of VfM is dictated by government and the "Value" part is restricted by their host Universities syphoning off Business School surpluses to fund very important and vital subject areas that, frankly, nobody wants to study?

INSIDE THE MAGNIFICENT (PRIVATE) FRANKFURT SCHOOL OF FINANCE AND MANAGEMENT

VfM is a market-based concept in the eyes not only of consumers but of economists.  In the way that economists love, it is given a different terminology - Benefit.  To be precise, Marginal Benefit - the satisfaction derived by ONE PERSON from consuming ONE MORE UNIT of the product/service.  Like Ice Cream, however, satisfaction typically reduces after the second, third....seventh unit.  Typically, however, the average student only "consumes" ONE undergraduate degree...

Much to the frustration of economists, "satisfaction" is in the eye of the individual consumer.  Who can tell what satisfaction individuals get from attending University?  Do economic data tell us about how happy people are?  Apparently not as accurately as downloading behaviour on such sites as Spotify.

So, can data actually tell us how satisfied students are?

• The NSS attempts this but there are so many methodological issues with its execution and the clear benefits of HE for the individual are certainly not known in the final year of study.
• Graduate Employment could be an indicator but many will be "satisfied" NOT working for a bean counting factory and so will not qualify as having a "graduate role".

And, I hear you say, what about "social benefit"?  the benefit derived by society in supporting, mainly through taxation, a high quality education sector.  Social benefit is a feature of market failure as consumers are less willing to pay for benefits that they do not feel directly.  We know this because so many students do not wish to pay with their time to study or read unless it's going to be on the exam.

Ah, wait, here's a radical thought - why not stop thinking of Universities as corporate businesses with consumers seeking VfM and suppliers seeking profit by squeezing costs at the expense of quality?

The bridge - a satisfaction survey

Engineering standards judge the quality of design and function, the strength and safety aspects of the bridge - BEFORE the bridge is built.  Once constructed, the bridge is tested to ensure it meets or exceeds key standards. The bridge can then be built, commissioned and used by all those wishing to cross to the other side. Periodically, the bridge is inspected. Maintenance and remedial and updating actions are taken.  This ensures fitness for purpose and safety.

SO, HOW DID YOU FEEL ABOUT CROSSING THE SYDNEY HARBOUR BRIDGE?

In history, bridges were provided from the public purse but, increasingly they are built by private organisations, granted time constrained monopolies to collect fees.  Fees can be fixed by governments so that they are not seen to be extortionate.

Rarely, if ever, is the fitness of the bridge judged by the experience of those crossing it or the benefits they accrue once they reach the other side.

Why is it so different in Higher Education?

Wonderful, wonderful Copenhagen

Copenhagen Business School was my 15th different Business School visit in the last 12 months - quite a feat as most of my job is undertaken by video conferencing!  CBS is an excellent School and particularly gets my seal of approval (yes, I know, they didn't ask for it nor do they want it, really).

So what does a School need to do to earn this unsolicited accolade?  Let me tell you...

THE LITTLE MERMAID WITHOUT THE DISTRACTIONS OF RIVER TRAFFIC AND  HORDES OF TOURISTS

My focus here is not the Business School as an entity but as a physical presence - perhaps a building or a series of spaces. So, in my view, a Business School that is fit for purpose in today's environment should have the following features:

• Space

That's it??

Well, of course, there's different types of space.  And here's a few I've seen on my travels:

• Teaching space - flexible
• Social space - everywhere
• Quiet space - in unexpected places
• Collaborative space - with resources to facilitate e-collaboration and F2F
• Flexible space - teaching
• Private space - but few closed doors
• Technical space - for video, on-line, webinar - and all fully supported
• Outer space - space outside that is served by wi-fi
• Thinking space - possibly the same as quiet space but that's just me...
• Meeting space - almost any of the above
• Bookable space - when certainty is needed
• Comfortable space - including standing space
• Sleeping space...

Of course, for its stakeholders, there will be different priorities.  Those of space efficiency, space to hide, space to meet and space to work are some of the different top priorities of key players.

And my favourite of all? - well, the last one I have visited as it adds to my picture of  the ideal Business School.

There's Virtual Gold in them thar' hills!

The creators and propagators of such cyber-currencies as: BITCOIN, LITECOIN, ETHEREUM, ZCASH, DASH... owe a lot to Higher Education. Not because the question "What is money" is a very common one that basic economics addresses but because Academics and Universities have been using a virtual currency for many years.

PICTURE BY XIANG GAO VIA UNSPLASH

The currency? Academic Goodwill.

Let us rehearse the properties of money by comparing cash with academic goodwill, defined here as that warm glow of satisfaction following a successful PhD examination at (obviously) a different University to your own.  The warm glow is often extended during the period between the viva examination and receipt of the Princely sum of (as much as ) £200 for almost a week of your time:

Quality	Money	Academic Goodwill
a medium of exchange	Cash is generally accepted by most in society – except bus drivers (exact change please) and internet retailers (that’s a USB port, not a coin slot grandma…) It is divisible, easily recognisable and now fully washable.	PhD examination can be a series of bi-lateral exchanges between colleagues in cognate areas of study.  You pass my student and I’ll pass yours.
a liquid store of value	Apart from notes going out of circulation in order to issue currency with pictures of the Duchess formerly known as Megan Markle on the obverse, cash retains its nominal value and is easily turned into, well, cash.	If that liquid is Scotch or Gin then the External PhD Examiner is an excellent storage vessel.  Some academics have a very limited capacity before they begin to spout nonsense, others show no difference in this capacity even after a few swift ones.
a unit of account	We do tend to value what we can measure and even more so if that measurement unit has a £, $ or € sign.	The number of PhD supervisions and even examinations on an academic CV can often be used as evidence of scholarship and reputation for such vaguely defined areas like promotion criteria.
a standard of deferred payments	Net Present Values reflect the value to the lender of payment deferment.  Lenders give up current liquidity for a price (interest).	Storing up goodwill here on earth may make a nice insertion into your obituary in the Times Higher.  There’s no longer deferment than that…