We Like to Think That...

As the world markets show signs of distress related to the downgrade of the US credit rating, I can't help but wonder how renewed distress in the minds of independent school families might affect enrollment in our schools. Schools that have been hanging by a thread since the events in 2008 and 2009 are holding their breath, no doubt. That thread may be due to purely financial reasons, but I'm willing to wager that almost every precarious scenario in a school is due to two factors: 1) over-leverage (unsustainably high debt:income ratio) combined with 2) lack of differentiation in the market place. That lack of differentiation may take different forms: it could be over-confidence in one's product (relative to the actual experience of graduates); it could be diminishing importance of a former mark of differentiation; it could be the unarticulated switch to an entirely new mission, with no (or little) forethought.

A book I've read recently underscored this same concept to me, as told in a short story, excerpted below. By the way, the book, Good Strategy, Bad Strategy, is perhaps the most useful tome I've read in some time. I will write a review on it in the coming weeks, as its importance to schools (and to strategic planning in particular) can be hardly understated.

"Steve Jobs is great at criticism. Arrogant and smart, he cuts to the heart of an issue with no wasted effort. [...] I and several other faculty members met with Jobs to discuss Apple's future prospects. 'I know Stanford,' he said, 'but I am not all that familiar with UCLA Anderson.' [Anderson School of Management at UCLA, home institution of the author of Good Strategy, Bad Strategy]. My department colleague [...] responded by offering the school's party line. 'We like to think that we are the entrepreneurial school.'

'That's interesting,' said Jobs. 'Which Silicon Valley entrepreneurs have come out of your program that I would recognize?'

[The colleague] grimaced, then answered truthfully, 'There aren't any.'

'Well, then, you've failed,' Jobs said with finality.

The question for schools, I think, is this: are we too prone to saying "we like to think that..."?

In other words, perhaps schools "like to think" one way, when reality is suggesting something different. I know that I have seen such cases, and I'm confident that I'm not alone.

It doesn't mean that schools aren't different or that they don't have a place in the market, but it does mean that schools haven't been paying attention to strategy, which is the point of the book...and can help to explain how schools that are over-leveraged got there in the first place: a defective understanding of strategy.

But more on that later...

Comments

[Gary Gruber]

Strategy, eh? Schools have been long on strategy and short on effective implementation of all those plans. While process is essential, product is the end game. Apple (and Steve Jobs) know that in spades or should we say, in design AND product?

My suggestion is to pick the top 1-3 priorities for one year or two years and get the commitment necessary to see the desired results.

What happened when it didn't come out like you had expected? How did that all important feedback instruct, inform, correct and even renew the behavior? We learn as much, or more, from our mistakes and failures as we do from our success. Onward!