Presentation and Workshop
Professor Paul Bacsich
Dipoli, 23 March 2004, Finland
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There is slowly increasing agreement on the methodologies of costing e-learning
So why is there a dilemma where Education see
“No Significant Difference” whereas Training sees
“Return on Investment”?
The challenge is to find a uniform evaluation/planning methodology, including costs, which copes with a “world without borders”
Borders are not only geographic
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Increased telephone call and printing bills for students due to Internet usage
Entertainment expenses “necessarily” incurred by staff at conferences but not reimbursed
Administrator time answering student queries
Support costs of a new Learning Environment
Costs of content “created in one’s spare time”
Costs of institutional collaboration
Costs of conformance to standards
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Activity-Based Costing (CNL2)
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Hidden Costs and Stakeholders
(CNL1)
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Planning (after HEFCE)
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Actual costs
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Workshop
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Done at Sheffield Hallam University (UK)
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Funded by JISC
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JISC recommendation that Activity-Based
Costing be trialled in a university
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ABC was developed as an alternative costing methodology by Robin Cooper and
Robert Kaplan of the Harvard Business
School (1988) in their research into product costing in the manufacturing industry.
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They argued that traditional costing distorted product costs (“peanut butter spread approach”)
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There is a cost to all activities carried out within an organisation
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Activity costs should be distributed to products in relation to their use
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method
Staff time
Resources
FT
FT
DL
Cost for each Customer/product/channel group
Business Intelligence
I.T. & Management
I.T. & Management
Activities
Hold
Tutorials
Cost driver
No. Students
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Gives more than just financial information
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Fairer system of overhead allocation
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Accountability of central services
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Highlights cross-subsidisation
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Recognises the changing cost behaviour of different activities as they grow and mature
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Can provide data for other initiatives, e.g.
Balanced Scorecard, EFQM
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Data collection can be costly and time consuming
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Initially it can be difficult to collect the data you want
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Determining appropriate and acceptable cost drivers
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More complex system and relies on impeccable accounting system
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“Its important in a service organisation to get started with ABM and not worry about total accuracy from the start. Accuracy will improve with time”
Antos (1992)
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Manufacturing
In manufacturing industry the central finance department require and analyse the costs of production and the makeup of the the organisations’ product portfolio. Its pricing policy is directly influenced by this information.
University
Very rare to find a finance director examining costs on a course-by-course basis. Product information is held in the
School and product decisions are not based primarily on cost.
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External:
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Report and Handbook available on Web at www.shu.ac.uk/cnl/
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Internal:
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SHU amended their cost codes and adopted a minimal form of ABM
Central Finance Department “very keen” to adopt ABC across the University
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Done at Sheffield Hallam University
Funded by JISC
Aim - to produce a planning document and financial schema that together accurately record the Hidden Costs of Networked
Learning
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Increased telephone call bills for students due to Internet usage to access lecture notes, course conferencing and assignments
Entertainment expenses incurred by academic staff at conferences but not reimbursed by the
Institution
The usage of research funding to bolster teaching resources - or visa versa
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detailed literature review of over
100 sources sectoral survey of UK HEIs seven case studies based on interviews with key staff survey of students at Sheffield
Hallam University consultation with other projects and experts world-wide
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Reluctance to consider timesheets
Reluctance to acknowledge overtime
Inconsistency and non-granularity of internal accounting
Worries about any move to ABC
Inhibition of innovation once the costs are known
“Cost of Costing”
“Cost of having done the Costing”
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Cost items recorded from literature
Current distance education costing models analysed
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Bates (UBC, Canada)
Rumble (UKOU)
Moonen (Twente)
Also looked at US (Flashlight, TCM) and training sector
Consultation with academic staff
Conclusion: Traditional financial accounting inappropriate for exposing hidden costs
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Planning and
Development
Three-phase model of course development
Maintenance and Evaluation
Production and Delivery
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Planning and
Development
Production and
Delivery
Evaluation and
Maintenance
 collecting materials
 coming up with - or being told the idea
 writing user guides or course publicity
 curriculum delivery
 duplication of materials
 tutorial guidance
 quality assurance exercises
 replacement and updating of materials
 evaluation against course aims
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Expenditure dimension
Staff costs
Depreciation
Expenses
Overhead
Total
Stakeholder dimension
Institution Student Staff
Total
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Sensing a gap in the market, now that many Arts graduates (e.g. at the BBC) have PCs and are on the Internet, Dr Carter at the University of Rother Bridge has got approval to mount a totally online course on Post-Deconstructionism as part of her new distan ce learning MA on “Radical
Philosophies”.
Phase
Planning &
Development
Types of task
Read the latest works on the topic, listen to a new radio series, create lecture notes, set essay topics. Adapt her own research articles on “deconstructing gender - wher e next?” to be suitable to final year students. Put all this on the course Web site.
Ask the Computing Service to set up a Bulletin Board System. (They want to charge for doing this. She refuses, citing the departmental overhead.)
Production &
Delivery
Maintenance &
Evaluation
Make more material available on Web, such as topical items on Philosophy, moderate discussion groups online, receive and mark essays sent in by email.
Set up “real” office hours for those students who live nearby.
Students want some “synchronous” online events; so must get technician to find out about RealAudio and record some lectures for next year. Also worried about the new OU global course in this area; how can she differentiate her course?
(What about her students at the BBC?) Can she write something about this in a journal and count it for the next RAE?
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In order to accurately record the Costs of Networked Learning you must have a universally accepted method of what costs to record, and how, in place from the start; which takes into account all stakeholders
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UK: 10 hours = 1 CATS point
180 CATS = 1 MSc
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120 taught, 60 dissertation
360 CATS = 1 degree
Bologna
Badly flawed concept but best we have
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Commercial figures: average $12000 per study hour, but very large standard deviation
10% of this for simple material could one aim for < $1000 per study hour?
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This is still around $8000 per CATS point.
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“Course conversion costs are about $25000 and up for a two-hour [per week] course, depending on the kind of interaction needed.”
Schooley (2001)
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“...we can say with some level of certainty that it can take on average about 18 hours - of faculty time [$1200 at $70/hour] - to create an hour of instruction that is on the web”.
Boettcher,1999
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(taken from Boettcher, 1999)
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Lecturing 2 -10
Small group teaching 1-10
Videotaped lectures 3-10
Web development 5 - 23
Teaching Text (book) 50 -100*
Broadcast television 100*
Computer-aided Learning 200*
Interactive video 300*
* require support staff as well
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1: Study of “engaging” multimedia: expensive
2: Study of existing or slightly modified (learning) resources: mid-price
3: Working on activities and assignments
(maybe in collaboration): cheap
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Forget research
Go for templates
Economies of scale: long runs of similar material
Professionalism
Outsource to specialists (outside HE/FE)
UK view: Outsource development - and support - to cheaper countries close to UK culture (provincial Canada, Australia, New
Zealand)
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http://www.shu.ac.uk/cnl/
Thank you for listening; now it is your turn
Paul Bacsich paul@matic-media.co.uk
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