Run It “Like a Business”

I worked at banks for 16+ years, and I would like to see our PPS finances run like a business.
Rita Rafalovsky, candidate for Board of Education, Princeton Public Schools (PPS)

A candidate for Board of Education in my town, a banker, is running on the age-old slogan that the local school system ought to be “run like a business.” There are many ambiguities in this claim, but no need to chase them all down. It seems a sufficient objection to the slogan, and to any campaign based on it, that the public schools aren’t a business. So it makes no sense to try to run them as if they were. The more sensible approach might be to identify the kind of institution they actually are, or should be, and run them that way. Imagine walking into a business establishment and announcing that it ought to be “run like a school.” That would  obviously be absurd, but it’s no less absurd if you turn things around.

The underlying assumption of the “run it like a business” slogan seems to be that “running X like a business” means running X with a view to effectively matching means to optimal outcomes. The further implication is that businesses have cornered the market on optimization: only businesses optimize, or perhaps, businesses optimize optimifically. In other words, no one optimizes like business, so if everything is modeled on business, all is for the best in the best of all possible worlds.

I’ve worked in higher education, and now work in business, and I see no reason whatsoever to believe that. There is no sense in which business, whether for-profit or not-for-profit, has cornered the market on bestness. So, slogans aside, there’s no reason why the world should be modeled on business.

The real problem is that the “run it like a business” slogan substitutes a stereotype of efficacy for an actual, institution-specific conception of optimality. For-profit businesses are run, primarily, with a view to making a profit–indeed, to maximizing revenue. In my line of business (health care revenue cycle management, or RCM), the aim is to maximize revenue flow per unit of time within a given revenue cycle. The ideal outcome in RCM is to maximize revenue from accounts receivable as quickly as possible within the present revenue cycle, regardless (for instance) of the outcome for the patient. A collections action that yields $2x in one day is preferable to one that yields $x in one day, even if the collections process kills or bankrupts the first patient while sparing the second. If we ran hospitals more “like a business,” hospitals would make more money, but bankrupt and kill more patients. That may be good for RCM, but it’s not necessarily good for patients. And if it’s not good for patients, it’s not obviously good for health care.

It should be obvious that public schools do not have a revenue-maximizing raison d’etre. So there’s no point in thinking that if you just run a school more like a bank, educational outcomes will improve. That won’t be true even if the businesses that function as the model for the endeavor are being run properly–which I doubt.* If they’re not, “running schools like businesses” creates a kind of double jeopardy, two malfeasances for the price of one. For one thing, it imposes a business model on something that isn’t a business. For another, it subtly introduces everything that’s wrong with business into an institution that didn’t previously have those problems, but now does.

Four of the five PPS candidates for BoE with reporter Krystal Knapp; Rafalovsky at top right
(Photo credit: Planet Princeton, from a screenshot of a YouTube discussion)

An obvious question has gone unasked here: What exactly are the public schools for? It’s not enough to say that they exist to promote “excellence,” much less to produce high test scores, or high rankings in US News & World Reports, or success at “getting students into the best colleges.” Those are substitutes for a direct answer, or proxy variables for measuring indirect answers. They don’t answer the most relevant question: What counts as success when it comes to graduating a student from the public schools? What are we trying to achieve when we do so?  And “we” is the right pronoun, since we’re collectively involved in producing the outcome, and collectively affected by it.

The standard answers one hears from candidates for BoE don’t make the grade. “Excellence” is too generic. Quantitative metrics are too reductionist and parochial. Detailed discussions of line item issues in the school budget, or pleas to keep property taxes down, are beside the specifically educational point. Something else is involved, whether or not bankers and other “quants” know what it is. Put it this way: I worked at educational institutions for 25+ years, and I would like to see educational institutions run as educational institutions.

If we really want measures of success in education, maybe we–and here I mean educators or erstwhile educators–should start giving grades to adult discussions of the topic. The rubric for these grades should be designed around two fundamental questions:

  • Did the interlocutors identify the proper aims of education in a comprehensible, determinate way?
  • Assuming that they did, did they ask the right questions about how to order means to ends given that aim?

Direct, cogent answers to those questions get an “A.” Less direct and less cogent ones get lower grades. In other words, maybe it’s time to start grading the people who seem so obsessed with grading and ranking everyone else.

Of course, one way to “grade” such a discussion is by voting. Guess how I did.

*The reasons for doubt are given in Cathy O’Neil’s Weapons of Math Destruction, on the misuse of computerized algorithms in contemporary business.

The views I express here are strictly my own, and do not represent my employer, or any other person or entity.

6 thoughts on “Run It “Like a Business”

  1. Pingback: Fascism and the Obligation to Vote | Policy of Truth

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