Two Issues Small Colleges Face in Online Learning

by Dr. Scott Moore | January 15, 2019

Estimated time to read: minutes

Student enrollments in online learning continue to increase but are very concentrated in public institutions and large private universities. Left out in the cold — and seemingly content to remain there — are the smaller private institutions.

However, it is becoming increasingly perilous for small colleges to ignore this trend. Many small colleges are facing student shortages that are leading to closings. Moody’s predicted in 2015 that small-college closures would triple if the institutions could not raise additional revenues.

Online learning offers a viable solution.

Two Enticing Advantages of Online Learning Programs

There are two distinct advantages to small schools implementing online learning programs: increased student diversity and tighter control of educational standards.

1. Increased Diversity of the Student Population

Online education is a means of reaching a more diverse student population, an advantage most colleges find highly desirable.

In a statement released back in 2012, the American Council of Education highlighted the importance of diversity in higher education.

These are worth repeating here:

  • Diversity enriches the educational experience.

  • Diversity promotes personal growth and a healthy society.

  • Diversity strengthens communities and the workplace.

  • Diversity enhances America’s economic competitiveness.

Small schools with online programs position themselves to capitalize on these advantages of a diverse student population. And they can do so without the expenses and physical constraints that come with offline programs.

2. Increased Educational Quality Control

Another advantage of online programs is the school’s ability to control the quality and value of their degrees.

EdSurge noted that private colleges are increasingly concerned about the credits students earn when they enroll in online courses at other institutions during summer and semester breaks. These outside courses may not reflect the same high educational standards held by the student’s primary institution.

However, by deploying their own online programs, these concerned schools avoid diluting the value of the degrees they offer.

Two Challenges to Implementing Online Programs - and the Solutions

One reason these small colleges have been slow to launch their own online learning is a reluctance to tamper with what has been their “special sauce”:

  • smaller, more intimate settings,
  • face-to-face interaction among students,
  • student interaction with faculty.

Small colleges take pride in providing these personal relations to students, and online learning can seem to be the antithesis of this mission.

As a result, when a private college launches an online learning program, they have to own it. Their programs have to reflect the college’s educational standards, their pedagogy, their community, and their unique character.

That requires a considerable investment, and they need to be as committed to making that investment as they are when they construct a new classroom building, library, or dorm.

Once a small college decides to make the leap, they will face a variety of challenges. Two barriers, in particular, frequently surface in my conversations with representatives of these institutions:

  • faculty resistance

  • financial obstacles

Fortunately, there are proven strategies to overcome both of these impediments.

Problem #1: Lack of Faculty Support

Many of my conversations are with folks from smaller colleges that have traditionally focused on their residential liberal arts programs. While there is more commitment to moving online than in previous years, there is still considerable resistance, particularly among the faculty.

Such resistance is almost inevitable. These faculty members have traditionally prided themselves on the personal connections they forge with students. They enjoy teaching with pedagogical approaches that are both engaging and challenging.

They see online learning as failing to deliver on these points. And they’re not completely wrong. Much of online learning is of the cookie-cutter variety that uses a “tell and test” pedagogy these gifted teachers find greatly lacking (“I hate MOOCs!”).

However, that’s also not the only approach available for online learning programs. In fact, at Extension Engine, we build custom learning experiences that take advantage of the personal approach found at smaller schools.

Solution: Give faculty a key role in designing the online learning program

Faculty support is crucial, and it’s critically important they feel heard. To achieve this at Extension Engine, we first ask questions of faculty and leadership to determine what defines the college’s distinctive character. Questions such as:

  • What types of pedagogy do you employ?

  • What student interactions do you foster?

  • What kind of community do you create semester after semester?

Second, our online team works with faculty and staff to gain an understanding of why their programs exist within the context of the larger institution. The goal is to uncover the motivations and concerns of the stakeholders at the heart of each program within the college.

Gathering this information enables the school’s leadership to assure faculty that the joy they get from teaching won’t be lost by moving online. As evidence, they can bring to the faculty’s attention some of the more recent advances in online learning pedagogy that capture the best of what happens in a small classroom.

Problem #2: Lack of Financial Viability

The size of small colleges often creates a financial barrier to building the right kind of online program - one that would faithfully represent their educational commitment to their students. This is not something that can be done on a shoestring.

Many larger institutions offset this cost by engaging an online program manager (OPM) to develop the offering. In this arrangement, OPMs provide most of the up-front investment in return for a significant share of the revenue.

However, working with smaller programs and smaller schools is less than ideal for OPMs. For OPMs, a higher volume of enrollments means more revenue. Fewer enrollments means less revenue and a longer payback period, not to mention a longer road to turn a lucrative profit.

Plus, the OPMs generally produce those cookie-cutter courses that faculty rightfully find so problematic.

The other obvious path forward for small schools is DIY: do it yourself. The difficulty here is finding, building, and maintaining the in-house staff needed to create and support such programs.

Furthermore, faculty members with the expertise and insight needed to be leaders of online learning are generally in short supply. Small schools without an online learning platform don’t tend to attract these types of faculty leaders.

So what’s the solution? Get outside help, but without sharing revenue.

Solution: Engage a fee-for-service firm - and keep 100% of the enrollment revenue

A perfect solution many small colleges are not even aware of is to work with a fee-for-service partner without a revenue-sharing contract.

With this arrangement, the school pays to design the learning experience and delivery platform while still retaining full ownership of the platform itself - just like constructing a new campus building.

This enables an institution to begin work with a knowledgeable, accomplished team. This team will slowly transfer skills and expertise to the college’s team as the engagement proceeds. Eventually, the institution takes full ownership of their program, or at least the amount of ownership that they want to take.

Certainly, this approach takes an up-front investment — many of our clients have either received a gift or taken money out of their endowment. It’s the same making any other significant investment in the school’s future — but the institution gets to keep all of the revenue from enrollments.

Over time, the school comes out far ahead.

Learn more by watching this webinar: Building Online Programs Without Revenue Sharing Online Program Managers (OPMs).

Recommended Next Steps

If the above speaks to you, your next step is very easy: set up a 30-minute meeting with me. We’ll talk about the specific challenges your institution faces.

Because I know how long the purchase cycle is in higher ed, you’ll find that I’m completely in “informing mode” rather than “selling mode.” I sincerely want to help you find the best path forward, whether it involves Extension Engine or not.

Consider it a half hour of free consulting with an expert in the field.

If there seems to be an organizational fit and the timing is right, we’ll dive into a financial model I’ve built to gain a realistic view of your venture into online learning. The model will give you more insight into the personnel and financial resources you will need to have at your disposal.

Keep Learning

A Financial Model for Online Programs: Revenue Sharing vs. Fee-for-Services Engagements

Learn about the advantages and disadvantages of online program manager (OPM) engagement models, which one is best suited for your institution, and how you can receive a custom-tailored financial model for your institution.

[WHITE PAPER COVER] A Financial Model for Online Programs: Revenue Sharing vs. Fee-for-Service (Higher Ed)*


Dr. Scott Moore

Dr. Scott Moore is a former Principal Learning Strategist at Extension Engine. In this role, he led the global Custom Learning Experience practice. He worked with dozens of nonprofit, higher education, and learning business organizations as they considered using online learning to support their mission and margin, using his deep understanding of organizational dynamics, online learning, strategic differentiation, decision-making, and more. Prior to joining Extension Engine, he was a faculty member, administrator, and dean at Michigan Ross and Babson College for 20+ years. He holds an M.B.A. from Georgia Institute of Technology and a Ph.D. in Decision Sciences from the Wharton School of the University of Pennsylvania.

Let us teach you about learning.

We'll send you an occasional email with resources from our team of learning experts.

Subscribe to Updates