14
Business Dimensions: The Education Market

Irv Shapiro

I am the chief executive officer for Edventions, which provides a suite of software services and training to introduce technology transparently into schools. Let me define “transparent” very simply. When you got into your car this morning, all you needed to do was hold onto the steering wheel, push two pedals (maybe three, if you are an advanced driver), and you were done. You did not think about what type of engine was in the car, why it worked, or any of those kinds of issues—the car was transparent technology.1

14.1 THE ROLE OF TEACHERS

I am most interested in the role of teachers in elementary schools, which are very different from high schools or universities. From a business perspective, teachers are both an asset and a liability. That asset and liability may be the solution to some of the questions posed earlier today (described earlier in these proceedings).

For at least 2,600 years, from the time of the Greek academies, when adults have wanted to introduce children to new material, they have sent

1  

Sandra Calvert noted that driving a car is not transparent for a new driver. When first learning to drive, she was concerned about what to do if she had to sneeze. This is something that requires thought; it is not an automatic skill. Even today, she carries an American Automobile Association card so that she can call emergency services if she runs into any problems.



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Technical, Business, and Legal Dimensions of Protecting Children from Pornography on the Internet: Proceedings of a Workshop 14 Business Dimensions: The Education Market Irv Shapiro I am the chief executive officer for Edventions, which provides a suite of software services and training to introduce technology transparently into schools. Let me define “transparent” very simply. When you got into your car this morning, all you needed to do was hold onto the steering wheel, push two pedals (maybe three, if you are an advanced driver), and you were done. You did not think about what type of engine was in the car, why it worked, or any of those kinds of issues—the car was transparent technology.1 14.1 THE ROLE OF TEACHERS I am most interested in the role of teachers in elementary schools, which are very different from high schools or universities. From a business perspective, teachers are both an asset and a liability. That asset and liability may be the solution to some of the questions posed earlier today (described earlier in these proceedings). For at least 2,600 years, from the time of the Greek academies, when adults have wanted to introduce children to new material, they have sent 1   Sandra Calvert noted that driving a car is not transparent for a new driver. When first learning to drive, she was concerned about what to do if she had to sneeze. This is something that requires thought; it is not an automatic skill. Even today, she carries an American Automobile Association card so that she can call emergency services if she runs into any problems.

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Technical, Business, and Legal Dimensions of Protecting Children from Pornography on the Internet: Proceedings of a Workshop them to school. Teachers are expected to teach more than reading, writing, and arithmetic. We also expect teachers to make decisions. Teachers have immense classroom autonomy. In elementary schools, the number of supervisory staff is small compared to the number of teaching staff, and teachers in the classroom are mostly on their own. They decide—we trust them to decide—what our children should learn each day. In that process, they make many selections. The same processes are at work in the elementary school library. The library does not have a million books in it. Even if the school could afford a million books, having a million books would not be a good idea. For example, if a third grader is writing a book report on George Washington and goes to the library and finds a thousand books on the shelf about him, the student will sit on the ground and begin to cry. I have four children; I know this to be a fact. School librarians and teachers select books for the library under the direction of the school board, state and federal standards, and recommendations from organizations. 14.2 HISTORICAL PERSPECTIVE The challenge is how to provide the tools that teachers need to lead and teach children in the Internet age. The present rate of technology change is unprecedented in history. The impact of information technology is comparable to the impact of Gutenberg’s printing press at the end of the 1400s, but today the impact is being manifested over several years instead of several decades. How do we empower teachers? Let us look at the last 30 years. Over the last 10 years, there has been universal agreement that the economy has been robust. Even with the adjustments occurring now (I am no expert, and I do not know if they are permanent or if this is a recession), times have been good for 10 years. When economists looked at this period of time, they were baffled initially, because, as I learned years ago in Economics 101, you cannot have both low inflation and low unemployment. You cannot have robust growth, low interest rates, and a full employment economy. Those things do not happen together; they have to be kept in balance. The Federal Reserve Board kept them all in balance, and taxes kept them in balance. Economists eventually concluded that there was a dramatic increase in productivity over that period of time as a result of the introduction of computer technology into the American economy. That increase in productivity allowed us to produce more goods for less cost. This sounds wonderful. But I was in steel mills in the mid-1970s installing computers, and I guarantee you that there was no increase in productivity. When we walked into the mills, they laughed about all the

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Technical, Business, and Legal Dimensions of Protecting Children from Pornography on the Internet: Proceedings of a Workshop people they were going to have to hire to take care of the computers doing their payroll, general ledger, and accounts receivable. Maybe the computers were controlling a couple of machines, monitoring temperatures of furnaces, and doing process control, but there was no increase in productivity. Let us assume, for the sake of argument, that there was no increase in productivity in the 1970s. Yet in the 1990s, the economy was robust. What changed? Some very smart people and organizations, such as SAP, Microsoft Corporation, Apple Computer, and Sun Microsystems, recognized that the computers in the plants, factories, and offices of America would not account for the difference. Nor would it come from the infrastructure. No, the difference was that these companies began to build specialized software for industry, and businesses invested hundreds of millions of dollars in training their workforces. In the 1970s, we put in lots of wires and computers; in the 1980s, we introduced new software designed to revolutionize the process of manufacturing. The word processor changes peoples’ lives. I have two children in college who would not even know how to write a paper in longhand. This is a technologically revolutionary time. So where does technology stand in the schools? Because of the E-Rate and other successful programs, we have put lots of computers and wires into the schools. But it seems to me that the schools are stuck in the 1970s because we have not retrained our teachers. We have not introduced new software specifically designed for these markets—especially for elementary school. Instead, we have taken software designed for the business community, universities, or high schools, and tried to roll it downhill to a second-grade classroom. Teachers in second grade do not have $5,000 projectors. They may have laptop computers, but PowerPoint and Excel are not tools for them. The teachers need something different. Thus, the opportunity for the business community now is the same opportunity that existed at the end of the 1970s for the traditional computer and software companies. There is a need for software and training in the schools. There is a need for help desks so that teachers can pick up a telephone and talk to a real person at 8:00 P.M. or 11:00 P.M. without being put on hold for an hour, as they try to prepare an assignment for the next day. This is a wonderful business opportunity, which is why I got involved with it 21/2 years ago. 14.3 THE SCHOOL MARKETPLACE The other side of the story is that teachers are scared. They are underpaid and overworked. When a teacher gives our children more home-

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Technical, Business, and Legal Dimensions of Protecting Children from Pornography on the Internet: Proceedings of a Workshop work, the teacher has more homework the next night, too. They get calls late at night. They work in a complex environment. Quite candidly, the skills that make someone a phenomenal second-grade teacher are probably not skills that would enable them to deal with such complexity. Change in the elementary school education marketplace is difficult, because teachers do not want anything to do with it. Our company has been involved in many districts where the superintendents and principals brought in a program but the teachers dug in their heels and said, “No, we will not use this stuff. We do not even want to learn it.”2 It will take some time. Unfortunately, the cost of time is dollars. In this economy that has just survived the dot-com world, think about time in terms of months, maybe a year and a fraction. When you talk to the investment community about going into a marketplace in which you may have to spend 2 years in a sales and educational process, providing education at a subsidized rate, the investment community says, “There are easier places to put our money.” Why should they do it? Because switching costs—to use economic terms—in the schools are very high. Once a program is in a school, it does not go away. If I had a magic wand, I would look at how to pump dollars into teacher education and the creation of software and technology specifically targeted to this marketplace, even though we know the payback probably will take 5 years instead of 18 months. The reason to do it is that the marketplace is very large. Look at the President’s budget and see the large numbers going into education. When you are in the market and are successful, you provide very good returns to investors. Whether you do that as a nonprofit, whether the government does it, or whether the government provides funds to a for-profit to do it, it is a fundamental issue. As a for-profit attempting to address that need, we find it very difficult to raise capital, because the return on investment takes longer than the current capital markets want. This is not just a private market problem. Look at the allocation of federal funds. As an example, E-Rate was strictly a program for lines and hardware. The way you get Title 1 dollars to apply to technology is to repackage the technology as reading, math, and basic learning. The overall challenge is to find a way to retrain the teachers—not put dollars into curriculum, hardware, 2   Sandra Calvert said teachers today are expected to do much more than teach. They are expected to solve social problems, such as parents getting divorced. Then the computer is thrown in. A teacher using a computer to give a presentation needs to become a technical expert in case something goes wrong. If it breaks down, then usually a whole classroom of kids is left sitting there, because technical support is seldom available in the classroom.

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Technical, Business, and Legal Dimensions of Protecting Children from Pornography on the Internet: Proceedings of a Workshop and lines, which is where I see the majority of the dollars going. Some federal money is targeted specifically to professional development, but look at the order of magnitude difference between professional development and hardware and infrastructure. Over the past 2 years, many businesses looked at the size of the pot in the education marketplace and attempted to fill the gap by using advertising revenues or other nontraditional revenue sources. They failed. We are left with two models, which may be fine. Very large corporations have a vested interest in the current model. They would like teachers to use textbooks in the exact same way as in the past; they are not interested in the technology changing too rapidly. These parties have deep pockets, which is okay. There is also the continual opportunity marathon, in which someone can start a small business and leave it as a small business. In a number of sectors of elementary schools’ infrastructure, there are many small “mom and pop” operations that never grow beyond serving the technology needs of a couple of communities. Teachers’ unions have no effect, positive or negative. In the long term, they could have a slight positive influence. But in the situations that we have seen over the past 30 months, this has rarely been packaged as a union issue. Every once in a while we hear, “Our contract is coming up in 6 months and we do not want any change until the contract is renegotiated.” There are many fearful teachers out there, and getting them over that fear is as massive an undertaking as the complete E-Rate undertaking. This is much more expensive than what we have done on the technology side. Unions could be a positive force in helping their membership to overcome this fear.3 There is another positive force coming. The statistics indicate that about 50 percent of the teachers in America are approaching retirement age, and as many as 50 percent will retire over the next 5 years. The people going into those jobs probably recently came from universities where they got all of their homework online and computers were used transparently, so they may demand this in the schools. Teachers become 3   Janet Schofield suggested that unions could be helpful in negotiating, for example, discounts for teachers buying home computers. In studying teachers, she has found that, if they have computers at home, they are more likely to get over their initial reluctance. Maybe sons or daughters train them, and they have more time in the home environment. Unions could reduce the economic barriers and create centers for their members to get home computers. She also suggested that teacher training relates directly to other issues at hand. For example, teachers seldom know enough about the Internet to realize how they might prepare kids to surf safely and responsibly. Teachers may not know how to locate good sites that will draw the kids in.

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Technical, Business, and Legal Dimensions of Protecting Children from Pornography on the Internet: Proceedings of a Workshop obsolete because we have not done our job of training them. If we had done our job better as a society of providing teachers with the expertise and training that they needed, then society would not have to solve this other issue of kids’ access to inappropriate material. Teachers are very influential, at least with very young children. We need to develop a business model that takes a patient approach to the retraining of the teacher workforce.4 Over the last 9 months, we have held training in 200 schools in Internet access, how to select good sites, how to use our particular tools, and a variety of related topics. We no longer will be doing on-site, in-service training. Instead, we are moving to a model in which we will train a trainer in the school and provide a variety of multimedia materials for the teachers. We have found that what is most effective with teachers is “just in time” training, rather than bringing them into an in-service for a day at the beginning of the year and then 4 months later when they go to use the materials. Providing that type of training and support mechanisms is expensive. It is a challenge to develop business models that will support the teachers so that they can provide the education that will cut down on some of the bad things that happen in this networked world. 4   Marilyn Mason said that when libraries began using the Internet, entire staffs were retrained. Librarians are neither more nor less reluctant to use technology than are teachers. But if a library had something very specific that it wanted the staff to do, and if librarians saw this as a way to make their jobs easier and make themselves more effective, then they could embrace the technology as a new tool. The education profession has not sorted out how the Internet can be a tool for improving education. Mason suggested looking at where one can intervene in a cycle. One opportunity may be the emphasis on test scores, because they provide some measure of effectiveness. There are software packages that help children learn to read, and they can be effective if used in libraries. The key is to make sure there is a common understanding of how teachers are supposed to use technology.