A World Apart: Decision Making in the Public and Private Sectors

An obligation to teach others about the cultural distinctions between school systems and private business by ROBERT R. SPILLANE and PAUL REGNIER

The past 15 years have seen a greater involvement of the private sector in public education than any similar period in history. This involvement has been overwhelmingly positive for education because business leaders have brought not only their money, influence and talent but also their sharp ideas into their relationships with schools and school systems.


The money has helped buy technology that allows schools to offer high-tech programs, to educate children with disabilities more effectively and to better support for minority students in their academic preparation for college. The influence has pushed states and municipalities to raise and enforce higher achievement standards and increase public funding for education. The talent has provided mentors for students and staff development for educators. And the ideas have pushed school systems to operate more efficiently and to be more sensitive to the needs of those we serve.

However, as with any mix of disparate cultures, the ideas that come from business do not always work in the context of public education.

Widespread Misunderstanding
In the multicultural environments in many schools, teachers and students are learning to understand and use the different ways of thinking and acting that characterize diverse cultures. Similarly, business leaders and educators work hard to understand, respond to and learn from the different ways their respective organizations operate. In this interaction of business and educational cultures--as in the case of multicultural interactions among students--misunderstandings are possible. Clarifying and learning from the differences can be useful for business officials as well as for educators.

One significant area of misunderstanding is the nature of decision making. Those in business often find it difficult to understand why educators cannot make decisions as easily as business leaders. In general, they can't, but there are reasons for this that are not a function of an administrative "blob" or a bureaucracy stuck on the status quo.

Where these two environments most differ are in identifying the "bottom line" and on the issue of private versus government control.

The Profit Motive
In business, the bottom line is always clear. While business leaders may not always know what they need to do to get there, and many other factors (such as the state of the international economy or the actions of competitors) impinge on their ability to reach a desired result, the bottom line remains pretty clear. For those in business, profit is the ultimate goal. Some businesses may strive for short-term profit and others will sacrifice short-term profitability for the long term. Sometimes, a business will keep prices (and profitability) low for a period in order to build market share, but the reason for this is profitability at some future point.

The goal is always well known to the business decision maker. The goal is also concrete: You are profitable when your (noncooked) books show your business is bringing in more money than it is paying out.

In public education, as any school leader is aware, the United States has a long history of differences about the purpose of education. At one time, many, if not most American educators, would have defined their purpose as "life adjustment"--that is, preparing each student for the life role that had been laid out for him or her. Academics were a low priority for such educators, who believed that preparing students for family life, employment and leisure were the most important objective. (As evidence, consult "The Cardinal Principles of Education," published by the U.S. Bureau of Education, in 1918.)

Happily, the days when such views were prominent are long past, but some educators still accept a version of them. Today, we have sex education, driver's education, drug and alcohol education, leadership training and various other nonacademic courses in our schools. Clearly, our society continues to be confused about what aspects of education and/or upbringing schools should to be responsible for.

Even those who think they have a clear idea of the results schools ought to achieve have difficulty agreeing among themselves. While most today agree on basic reading, writing and arithmetic, most also agree that students need to learn a lot more but have difficulty gaining consensus on just what that "more" should consist of. Generalized goals, such as "read and understand major literary types, genres and traditions of the English language" or "apply scientific knowledge and processes to make informed decisions and to solve problems," are vague enough to gain consensus, but is there consensus as to whether all students should recognize the "to be or not to be" soliloquy or know the periodic table of the elements? Look at the uproar over E.D. Hirsch's concept of "cultural literacy" to see what can happen when someone suggests actual knowledge that all students should acquire.

And when it comes to assessing what students are supposed to have learned, one runs into major brouhahas about psychometrics, authentic versus objective testing and charges of unfairness for expecting every student--whatever his or her cultural background, learning style or particular intelligences--to learn the same things or to be assessed on them in the same ways. In comparison, figuring out a business's profit picture is a walk in the park.

Democratic Influences
The second major difference is in the governance structure. Businesses have various and sundry governance structures. The corporate structure usually involves a board of directors that represents the stockholders. The stockholders are interested in making money on their investments, and they usually will do so if the company makes a profit; usually, the bigger the profit the more the stocks are worth and the more support the stockholders and their representatives, the board of directors, will give to those who run the day-to-day operations of the company.

Reality, of course, is more complicated than this, especially in an age of corporate takeover specialists and other denizens of the financial markets. But decisions that make a company profitable usually will garner support.

Consider also the customer. To be profitable, a company needs to please the customer, who then votes with his or her wallet on the merits of the product or service. All other things (such as operating costs) being equal, the company whose product or service sells the most units by pleasing the customers who make the most purchases will be the most profitable and will have the most support from stockholders and board of directors. Satisfying the customer is the key to success.

While democratic mechanisms have little influence on private business, in education elected democratic institutions provide the governance structure. The typical school system is governed by an elected school board, which is either financially independent or receives most of its budget from an elected municipal or state body. Any major decision must be supported by the school board. But contrary to the views of many business leaders and educators, school boards are not much like boards of directors. School boards are responsible to the voters and taxpayers--the voters who elect them and the taxpayers who provide the budget.

To some extent, voters and taxpayers are the same constituency, but in many cases fewer than 50 percent of eligible taxpayers vote so that an elected school board may represent, at least temporarily, a minority of taxpayers. Without getting any more complicated, let us say that pleasing the voters/taxpayers is to school boards what pleasing stockholders is to boards of directors. However, not all school board members will agree on what pleases the voters/taxpayers because they are elected by different constituencies. Like it or not, this is democratic control.

Who’s the Customer?
Nothing is simple. If pleasing the customer is, for a business official, the key to satisfying the stockholders, what is the equivalent for an educational leader? Who is the customer? Many educators would say the student is the customer, but others would say it is the parent. However, students don't usually vote or pay taxes and, with parents who have school-age children comprising only 20 to 30 percent of the voters/taxpayers in most school systems, a good argument can be made that all voters/taxpayers--not just the parents--are the customers.

However, are decisions that please the customer always the right decisions? Actually, many school leaders have operated for a long time on the assumption that the customer (usually defined as the parent, sometimes including the student) is always right, and this is the underlying assumption of those who argue for privatizing (or commodifying) education. But parents represent a small percentage of those who vote and pay taxes and the rest have a stake in education too.

Parents are often happy with a school if their children are happy there, even if the children are not learning at the rate or level of which they are capable. The entire society has a stake in students being educated to the highest level. In other words, education is a social good and not just good for the parents of each child. This is why public schools operate under democratic control by elected school boards. Schools have an obligation to educate students in such a way and to such a level that the entire society--not just the parents--is satisfied.

A Teachable Lesson
In many ways, making decisions in the private sector is much easier than in public education. Corporations must only please their stockholders, and what will please them is pretty straightforward--financial profits. School systems must please the entire society, although they work daily with students and parents who represent only part of society, and what will please either parents or the entire society is not always clear.

This distinction is something that leaders of school systems (and other public institutions) can teach the private sector. The private sector may be more efficient and able to make decisions more easily, but they are not serving the entire society.

Robert Spillane, former superintendent in Fairfax County, Va., and 1996 National Superintendent of the Year, is regional education officer for Europe with the U.S. Department of State, Office of Overseas Schools, 3100 Clarendon Blvd., Arlington, Va. 22201. E-mail: robert.r.spillane@dos.us-state.gov. Paul Regnier is director of publications, Fairfax County, Va., Public Schools.