Measuring an Education ROI: No Dollar Left Behind

It's time to start measuring educational success by aligning financial resources with performance expectations. "True" educational return on investment (ROI) deserves our undivided attention.

The concept of ROI is second nature in the business world -- the idea that the quantitative benefit gained from an investment of money or time equals the benefit derived in exchange for money or effort expended. But how do we assure that the money spent on education yields the appropriate benefit to our students? How do we translate this concept of business ROI to the academic environment to assure students achieve the best outcome?

In the private sector, we give significant attention to shareholder ROI. Students, parents and community members are shareholders of something, too -- a common ideal -- and have the right to look for a return that goes beyond high stakes standardized tests or a high school diploma.

How do we measure a district's academic achievement relative to its educational spending? Florida's "Return on Investment/School Efficiency Measure" links learning and costs. I don't think high stakes tests are the best way to measure student learning, and I look forward to the online assessment initiatives underway by PARCC and Smarter Balanced to develop new sets of assessments.

However, this example offers a good way to consider educational effectiveness. Now is an ideal time for states to consider developing models that align with the new student achievement measures coming in the next few years. Can we create a measurement tool that enables us to calculate our educational spending versus results nationwide that includes post-secondary success?

The "Return on Investment/School Efficiency Measure" provides a wealth of information online so that anyone with a computer can compare their Florida school's progress with others in the community or anywhere in the state. The bottom line is this shows each school's learning progress (measured by the percent of students with learning gains) compared with the program costs.

According to the Center for American Progress, the amount spent annually per student has nearly tripled over the past four decades. But what about increased student productivity or demonstrable learning gains? Are these results commensurate with the money we spend? And is educational success being achieved across the board, in every community across the country?

To ensure that every student has equal access to educational opportunities, it's time to pay attention to the way our money is spent and where it is allocated. Focusing attention on how our resources are apportioned and aligning those expenditures with performance outcomes might be the best way to generate a positive return on educational investment.

 

Follow Lydia Dobyns on Twitter: www.twitter.com/LydiaDobyns

Comments

[jolieok]

04:47 PM on 04/09/2012

Wow, what an interesting and provocative article. You are addressing relatively uncharted philosophical waters, and it is needed! How to establish ROI metrics by using statistical outcomes in education is quite a challenge. I guess it opens that whole can of worms called, “What is Considered Useful Education and Who Decides That You Achieved It?” Since public education is “free” the financial aspect is also hidden to the “consumer.” Usually it is the consumer or corporation who drives the cost/benefits, but in this case, the issues are less clear.

Thank you for bringing this to our attention.

[pscurtis]

01:53 PM on 04/04/2012

Dobyns is making an excellent point. The current economic pressures and incentives for schools is to reduce the cost per pupil. When shrinking budgets force schools to increase class sizes, there is no commonly used formula for understanding the impact that has on learning. I admit this is a challenge because "student success" is much more difficult to measure than "profit", but it can be done. Quantifying the return on the investment we make in our students is an important part of changing people's perspectives on education.

[mander1141]

04:47 PM on 04/03/2012

Define 'performance outcome' for us. In my state (California) every education dollar flows to the state capitol; and after the pigs at the trough in Sacramento have had their fill pushing it toward their cronies in private industry, the slop that remains flows back into the schools in the form of 'categorical funding'. Meaning that schools are only allowed to spend money in specific areas and in specific amounts, which is often not where its needed, meaning that schools must either buy a bunch of crap they don't need or send it back to Sacramento. Nice, huh?

[LATEACHER1X]

08:45 PM on 04/03/2012

Just another way for them to make stealing appear legal.