Restructuring for the 21st Century: A Social Entrepreneur in Higher Education

In higher education, leaders in private nonprofit and public institutions face myriad challenges, from competition with for-profit institutions to never-ending tuition increases to vast and ongoing learning-related technology changes. To contend with these challenges, leaders must maintain academic standards, while also managing their marketing operations to ensure acceptable enrollment rates. This conflict between business and academic needs is pervasive throughout higher education today.

Here, we offer a case study based on interviews with a social entrepreneur who managed these inherent conflicts while restructuring a research university's school of education. We also offer findings from our interviews with administration, faculty, and staff members after this social entrepreneur's tenure at the school ended. The lessons learned and the insights gained from both sides of this experience can be valuable to the many institutions seeking to balance the needs for revenue and social value in higher education today.

Social Entrepreneurs

To analyze how our social entrepreneur managed both business and academic goals, we use the concept of social entrepreneurism.¹ Social entrepreneurs traverse the boundaries between business operations and social services, using the strategies from both sectors to build successful social enterprises.² They also respond to markets, emphasize choice, and view students as customers — all of which may upset traditionalists.³ Indeed, in higher education, social entrepreneurs often encounter resistance from administrators, faculty, and staff members who subscribe to conventional academic norms and view market practices as threats to those established traditions.

Despite this resistance, social entrepreneurs in higher education and other education settings can achieve academic and business goals by accepting, differentiating, and integrating those often-paradoxical goals⁴ as follows:

• Acceptance: acknowledge the competing demands as an inherent part of organizations and learn to live with them.
• Differentiation: recognize the unique contributions of each alternative.
• Integration: simultaneously address both alternatives and seek synergies between them.⁵

Before we describe how our social entrepreneur applied these principles, we offer a brief overview of the context and the pressures in higher education today.

A Changing Education Market

In the early 2010s, American education was undergoing dramatic changes. Technology and the clamor for accountability were severely impacting K-12 education, as were constantly rising tuitions in higher education. Further, neoliberal (or market-based) entrepreneurial approaches to education, which began in the early 1990s with charter schools and new teacher recruitment/preparation organizations such as Teach for America (TFA), were also challenging public education to become more entrepreneurial. In addition, strong new federal policies such as the 2009 No Child Left Behind Act and Race to the Top Fund [https://www2.ed.gov/programs/racetothetop/index.html] were forcing changes in the education marketplace.⁶

Social entrepreneurs, venture capitalists, education incubators, and philanthropists took advantage of this neoliberal climate in education and got busy developing and funding new approaches to teaching and learning in K-12 education.⁷ TFA and other social entrepreneurial programs — such as the New Schools Venture Fund — as well as engaged philanthropists such as Eli Broad and Bill Gates, were driving a changing education sector.

The new educational landscape also brought sharp criticism of the traditional teacher preparation programs housed in colleges of education. A 2006 Woodrow Wilson National Fellowship Foundation Education Schools Project report described America's teaching force as inadequately and improperly trained; it also criticized education school programs designed for school leaders, principals, and superintendents as having low admissions standards and irrelevant, inadequate coursework.⁸ In short, education colleges needed to change their teacher preparation programs to better address market volatility and reformist criticism.

While adapting to changes in K-12 teacher preparation, colleges of education also had to confront a changing and more competitive higher education sector. Beginning in the early 1990s, and accelerated by the 2008 recession, college marketplace competition boomed along with online course offerings and a robust for-profit sector.⁹ Outside the traditional educational sector, entrepreneurial higher education technology companies — such as Blackboard, Laureate Education, and 2U — were proliferating. Indeed, by 2010, the education market was valued at $500 billion.¹⁰ Finally, ever-mounting student loan debt increased attention to higher education operations and raised the consumer consciousness of students.

Case Study: College Dean as Social Entrepreneur

As the above discussion shows, by the 2010s, US colleges of education faced two key challenges: a newly competitive and innovative higher education environment, and academic changes in the K-12 sector.

To explore the impact of these changes and a possible path forward, we offer a case study set at "RU," a private, tier-one research university that is regularly ranked as one of the nation's top 25 undergraduate institutions. Our entrepreneurial leader — referred to here as "the dean" — was hired as the dean of RU's College of Education (CE). As such, he had to address these pressing sector challenges while also navigating the expectations of both the central university administration and CE's reluctant faculty and staff.

Our case study examines how the dean functioned as a social entrepreneur, managing the competing demands of his social and financial missions to make the college successful. We also examine his attempts to secure staff and faculty commitment to the restructuring plans.¹¹ After offering a brief description of the college, we review the dean's tenure at CE; later, we offer findings from a series of ethnographic interviews with administrators, staff, and faculty employed during that time.

CE Overview

The new dean arrived at CE with a mission. At a time when the other RU colleges were at or near the top of the annual U.S. News & World Report rankings, CE hovered only around the top 10 among education schools. Furthermore, the college was running large deficits and losing enrollments, a situation exacerbated by the 2008 recession. RU's president was anxious for the dean to reorganize CE and make it, like RU's other professional schools, one of the nation's top three graduate schools in its field.

To survive and prosper in the new post-recession market environment, CE had to become more aggressive and entrepreneurial — in other words, it had to be less risk averse and more opportunistic.¹² The position was perfect for an educational entrepreneur.¹³ To make CE one of the top US graduate schools of education, the dean had to build on the school's academic reputation while also using market strategies to secure new fiscal resources; he viewed CE's restructuring and its need for new partnerships not as a possible path, but rather as a necessity.

The Challenges

When the dean arrived, CE had a part-time student body of approximately 5,000 and a staff of 50 full-time faculty members. CE also faced several key obstacles to meeting RU's aspirations for it.

Role and reputation. CE is affiliated with several well-respected educational research and policy centers, although only one such center was embedded in the college at that time. With the research centers mostly separate from the college and a history of part-time teacher preparation programs, CE's predominant organizational culture was one of part-time programs providing educational opportunities for in-state working teachers. In fact, the CE's principal competition for master's teaching programs was a collection of state institutions, including the nearby state university. Also, while some of CE's research faculty members had national reputations, they did not spill over to the college's reputation.

Falling revenues and enrollment. CE had a 100-year history of teacher preparation, yet it had become an independent RU college just a few years prior to the dean's arrival. The dean thus viewed CE as a start-up operation, but one that was facing some troublesome trends. He arrived during the peak years of the Great Recession, when tuition reimbursements from teacher preparation courses — one of the school's primary revenue sources — had dropped dramatically. Further, according to CE data, from 2008 to 2012, CE enrollments were down by approximately 30 percent.

Risk-averse culture. When the dean arrived, CE's organizational climate did not appear conducive to entrepreneurial innovation. RU itself had a poor record of spinoff businesses, despite its lead over competitor institutions in federal research funding.¹⁴ In addition to being embedded in this risk-averse institutional environment, CE was also home to a traditional education faculty with limited interest in the push to make higher education more entrepreneurial.¹⁵

Despite these challenges, RU's central administration expected the new dean to transform CE into a top research center with a strong reputation, burgeoning enrollments, and a high national ranking — a position befitting the RU brand. To balance his budget while also attaining a high position in the U.S. News & World Report list of graduate colleges of education, the dean had to do more than increase tuition revenues and enrollments; he had to find new revenue sources and improve CE's reputation. He recognized that the centers could play a role in the latter, as such affiliations were a key component in college rankings.¹⁶ But where would the new revenues come from?

Solutions: Social Entrepreneurism

The dean understood that, to fulfill his mission, CE had to become more of a national rather than a regional college, which would require organizational restructuring.

Balancing competing demands. To restructure the college and improve its reputation, revenues, and ranking, the dean adopted some market-based tactics, a popular concept in the contemporary neoliberal approach to higher education. He thus set out to build a market-oriented program while at the same time maintaining and enhancing the organization's existing social mission. To do this, he had to accept and become comfortable with competing demands.¹⁷

The CE market mission was to increase revenues, while the social mission was to prepare teachers, education leaders, and scholars, on both the doctoral and master's levels, to high academic standards. It was a difficult balancing act. Research shows, however, that maintaining this type of balancing act can succeed when the social entrepreneur holds on to the three contradictory concepts (accepting the organization's bifurcated reality, differentiating between the market and social missions, and integrating the bifurcated operations into a well-functioning organization).¹⁸

So, to carry out his mission, the dean seized the social entrepreneur mantel. Developing internal and external partners is one strategy for balancing an organization's bifurcated mission.¹⁹ The dean began by looking for new partnerships internally.

Finding internal partners. The dean first brought the RU-affiliated education research centers more deeply into CE's orbit, thereby increasing the number of research faculty at the college. As a result, CE was also able to count some of the centers' sponsored research dollars (nearly $100 million during his deanship) as a part of its own research money, which is a key metric in national reputation. However, while the dean created close collaborations with the centers, he was not able to fully integrate all of them — and thus all of their millions of dollars in federal funding — into CE's operations. In another internal-partnership development aimed at enhancing revenues, the dean worked with CE's existing full-time faculty to redesign the doctor of education (EdD) program from a face-to-face to an online degree.

Finding external partners. Externally, the dean brokered an innovative entrepreneurial partnership with a nationally renowned alternative teacher recruitment program. This partnership enabled the successful development of an online master's in teaching degree for the group's members, who work in school systems across the country. Unlike the internal partnerships with the centers and the CE faculty, this partnership plan used a third party (a private international education company) to provide some staff and a program-development platform. Doing so got the program up and running quickly. Within three years, nearly a thousand of the alternative program's teachers were enrolled in the CE online master's in teaching degree.

While this three-way partnership was successful, shortly after the online master's program was established, RU's central administration pressured CE to replace the outside operating company with CE's own staff and Blackboard. CE thus had to abandon its education company partner while still owing the company money for the original partnership.

Partnership outcomes. The redesigned EdD program quickly recruited a talented pool of applicants and, within three years, was attracting 500 applications per year for 100 seats. So, despite the criticisms from the administration and the initial lack of faculty enthusiasm, the two partnerships (for the master's and EdD programs) eventually stemmed the hemorrhaging enrollments and stabilized CE's tuition revenues.

The Stakeholders' Views

Following the dean's departure, we conducted focused interviews with administrators, staff, and faculty who were employed at CE during his five-year tenure. For our interviews, we used focused ethnographies, which concentrate on a group of people in a particular place and time.²⁰ Our goal with these interviews was to understand the perspective of participants who experienced the restructuring period of social entrepreneurial change led by the new dean.

The Existing CE Context

Prior to the dean's arrival, CE was already bifurcated academically along lines other than the marketing and academic split at the heart of this case study. This prior bifurcation problem resulted from two distinct academic missions among faculty members that CE had never fully integrated.

One faculty group maintained the traditional role of an internationally known research faculty. To these professors and the centers' research faculty, research was primary and instruction was secondary. The other group focused on instruction and ran the part-time teacher preparation programs. Thus, the dean faced dual challenges: the faculty was already split between two different academic missions, and he now wanted to further bifurcate and integrate them along academic and marketing lines.

Interview Findings

Our interviews show that, while most faculty members recognized that the market objectives differed from the academic objectives, they primarily acted more like observers than participants in the dean's market operations. They did not share his urgency to improve the market side, and they primarily confined themselves to protecting CE's academic standards (that is, to its social mission).

General reactions. Some faculty members felt that, because he needed to raise revenues quickly, the dean moved too hastily; as a result, some faculty members were uncertain about their future. One faculty member told us that, if the dean wanted the faculty to fully accept the two missions and their integration, then he should have slowed the change process. Further, another senior faculty member, expressing her unease with the two missions, observed that such a differentiation never splits resources evenly, and that the dean would be forced to choose between CE's social and financial missions at some point during the restructuring.

However, the interviews also demonstrated a certain level of acceptance of the competing demands among administrators and many of the faculty members. As one faculty member put it, "anyone paying attention understood the need for increasing tuition revenues."

Nevertheless, some faculty in the face-to-face teacher preparation program did not accept the new emphasis on a parallel marketing mission; some of those faculty members retired and left the school. Further, some of these same instructional faculty members abandoned their traditional student recruitment efforts, making the two missions harder to integrate. Those instructors believed recruitment was now the responsibility of the organization's new marketing side. So, ironically, this faculty actually deintegrated their formerly integrated missions of student recruitment and academic instruction. This confusion, coupled with the lingering impact of the national recession, resulted in plummeting enrollment for the teacher preparation programs.

Reactions to key programs. The interviews showed three different reactions to and paths forward for three key CE programs — the new online EdD, the new online master's, and the existing face-to-face teacher preparation programs. The online EdD was integrated and accepted, and it was an immediate success for the college. This EdD integration was achieved when a senior faculty member accepted the need for differentiated approaches to that program and took the lead on its integration, development, and implementation.

In the case of the new online master's program, achieving a successful integration of the social and business missions took more time. This integration was led not by CE faculty, but by the dean's immediate staff in cooperation with the third-party platform provider and CE's own technology research center.

Finally, faculty did not accept the restructuring of the established face-to-face teacher preparation master's program into both social and market-oriented missions. In fact, because the program's instructors decided to abandon student recruitment efforts, the two missions were deintegrated to an even greater extent than before.

Lessons Learned

The varying integration success for the social and market functions in these three key programs suggests that faculty understanding of acceptance and differentiation may vary between and within multiple programs in the same organization. They also suggest that faculty-led program integration (as with the EdD) may be more easily adopted than program integration led by the dean's staff (as with the online master's).

Further, the plummeting enrollments in the long-standing face-to-face master's program suggests that acceptance of changes in a volatile time also requires that administration, faculty, and staff members recommit to accepting the differentiation and integration of the existing programs.

The interviews also showed that some faculty members became anxious as the dean pushed ahead with his efforts to differentiate and integrate the marketing and academic missions. This may be because most of them neither worked on nor understood the process of integrating the different missions. One senior faculty member indicated that perhaps faculty would have felt more at ease with the dean's change process if CE offered faculty members tenure, but it did not. In contrast, a member of CE's advisory board, who represented the business sector, suggested that, for an entrepreneur, hurt feelings or upset staff members might be symptoms of success, not failure.

Further, there were issues external to CE that impacted the efforts. A former CE administrator noted that RU's Central Development Office treated the college as a problem child and gave the school "no respect." In addition, RU offered CE little financial support. The dean was nonetheless under great pressure from RU's administration to balance CE's budget and score a high placement for the college in the U.S. News & World Report rankings.

That same administrator noted, however, that the dean did not discuss these external pressures with the CE faculty. While issues of acceptance, differentiation, and integration swirled around the restructuring, the dean could not slow down on either of his differentiated missions; as a result, he had limited time to support the faculty and staff members' acceptance and integration of the bifurcated mission.

An Entrepreneur Departs…

During the dean's first five years there, CE achieved and maintained the highest rankings in U.S. News & World Report for several years. This, of course, greatly pleased RU's president and trustees, and the dean's contract was renewed.

However, the dean had begun to detect increasing resistance to his approach. Some trustees had begun questioning the external partnership with the private international education company that had made the quick growth of the online master's program possible. This was an interesting development, given that the private company's president was also an RU trustee. Further, RU's president became nervous about some of the dean's entrepreneurial ventures that were taking longer to mature than the two new online programs. Finally, an older, established CE program ran into significant financial problems. All of these new challenges began to detract from the dean's political capital with the trustees and the president.

Understanding full well that entrepreneurship may be risky to one's job in an institution of higher education,²¹ the dean decided to leave CE to become president of a private university shortly after renewing his five-year contract with RU.

At his farewell town hall meeting with the CE faculty and staff, the dean said that it had been a wonderful few years; he added that more than 60 percent of the tuition revenues were now coming from the new online programs. In addition to greatly enhancing CE's revenues, both the online master's program and online EdD program had enhanced CE's academic mission. Together, the programs had broadened and improved CE's teacher prep and leadership programs, enrolled more than 1,000 students, and contributed to CE's national reputation.

Still, the issue of integrating CE's market-response and academic-reputation missions remained unresolved at the dean's departure. At the faculty meeting immediately following his final town hall, one professor opened the meeting with a question that offers insights not only into CE's own progress in adopting and integrating the bifurcated missions, but perhaps into that of other research universities with colleges undergoing restructuring as well: "Now that [the dean] is gone," the professor asked, "can the College of Education go back to offering mostly face-to-face classes?"

Notes

1. Wendy Smith, Marya Besharov, Anke K. Wessels, and Michael Chertok, "A Paradoxical Leadership Model for Social Entrepreneurs: Challenges, Leadership Skills, and Pedagogical Tools for Managing Social and Commercial Demands," Academy of Management Learning and Education, Vol. 11, No. 3, 2012: 463–478. ↩
2. Anne-Claire Pache and Imran Chowdhury, "Social Entrepreneurs as Institutionally Embedded Entrepreneurs: Toward a New Model of Social Entrepreneurship Education," Academy of Management Learning and Education, Vol. 11, No. 3, 2012: 494–510. ↩
3. Heinz-Dieter Meyer and Brian Rowan, "Varieties of Institutional Theory: Traditions and Prospects for Educational Research," in The New Institutionalism In Education, Meyer and Rowan, eds., State University of New York Press, 2006: 217–224. ↩
4. Smith, Besharov, Wessels, and Chertok, "A Paradoxical Leadership Model for Social Entrepreneurs," 2012: p. 466. ↩
5. Ibid., p. 466. ↩
6. Stacey Childress, "From Generation to Generation," in Educational Entrepreneurship Today, Frederick Hess and Michael McShane, eds., Harvard Education Press, 2016: 11–55. ↩
7. John Bailey, "Tailwinds and Headwinds," in Educational Entrepreneurship Today, Frederick Hess and Michael McShane, eds., Harvard Education Press, 2016: 53–76. ↩
8. Arthur Levine, Educating School Teachers, Education Schools Project, 2006. ↩
9. Daniel Bennett, Adam Lucchesi, and Richard Vedder, For-Profit Higher Education: Growth, Innovation and Regulation, Center for College Affordability and Productivity, 2010. ↩
10. Wayne Au and Joseph Ferrare, Mapping Corporate Education Reform: Power and Policy Networks in the Neoliberal State, Taylor and Francis, 2015. ↩
11. Smith, Besharov, Wessels, and Chertok, "A Paradoxical Leadership Model for Social Entrepreneurs," 2012: p. 469. ↩
12. Daniel Levy, Heinz-Dieter Meyer, and Brian Rowan, "How Private Higher Education's Growth Challenges the New Institution," in The New Institutionalism in Education, Meyer and Rowan, eds., State University of New York Press, 2006: 143–162. ↩
13. Jaakko Kauko, "Complexity in Higher Education Politics: Bifurcations, Choices and Irreversibility," Studies in Higher Education, Vol. 39, No. 9, 2014: 1683–1699. ↩
14. Martin Kenney and W. Richard Goe, "The Role of Social Embeddedness in Professorial Entrepreneurship: A Comparison of Electrical Engineering and Computer Science at UC Berkeley and Stanford," Science Direct, Vol. 33, No. 4, 2004: 691–707. ↩
15. Ibid., p. 697. ↩
16. James R. Mingle, Higher Education's Future in the "Corporatized Economy," Association of Governing Boards of Universities and Colleges, 2000. ↩
17. Smith, Besharov, Wessels, and Chertok, "A Paradoxical Leadership Model for Social Entrepreneurs," 2012: p. 464. ↩
18. Ibid., p. 465. ↩
19. Timo Meynhardt and Fabian Diefenbach, "What Drives Entrepreneurial Orientation in the Public Sector? Evidence from Germany's Federal Labor Agency," Journal of Public Administration Research & Theory, Vol. 22, No. 4, 2012: 761–792. ↩
20. Herbert Knoblauch, "Focused Ethnography," Forum Qualitative Social Research/Sozialforschung, Vol. 6, No. 3, 2005. ↩
21. Robert Brown and Jeffrey Cornwall, The Entrepreneurial Educator, Scarecrow Press, 2000. ↩

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Henry M. Smith is an assistant professor in the School of Education at the Johns Hopkins University.

Elizabeth Humberstone is a PhD student in the School of Education at the Johns Hopkins University.