07/16/2008 05:12 am ET | Updated May 25, 2011

Charter Schools Get the Test Scores Up

Village Academies founder Deborah Kenny is racking up remarkable successes with young black and Latino students in New York's Harlem

When investment banker Herb Allen's annual gathering of media executives kicks off in Sun Valley on July 8, plenty of familiar faces will be seen strolling the picturesque grounds in the shadow of Idaho's Sawtooth Mountains. This year, however, the star of the show may not be Time Warner's (TWX) Jeff Bewkes , Walt Disney's (DIS) Robert Iger, or IAC's (IACI) Barry Diller. It may very well be a 44-year-old educator from Harlem.

She is Deborah Kenny, founder and CEO of the Village Academies charter schools. Allen invited Kenny to speak at the conference about education reform. She is one of the few educators ever to address the group, and unlike most of her audience of media moguls, Kenny may actually have some positive results to brag about. In just five years, test scores have improved dramatically at her schools, in a part of New York that historically has had 75% failure rates.

"The state of education in this country is an epidemic. Thousands and thousands of kids are trapped in failing schools with no chance in life," says Kenny. "But it is not like a disease you can't cure. If it can be done in Harlem, it can be done elsewhere."

Ill-Prepared Employees

In the more than two decades that Allen & Co. has hosted the Sun Valley conference, the scene has evolved from a hothouse of dealmaking to a forum where broader issues, economic and social, are discussed. And while media moguls may not be talking much about hiring this year, a great concern remains that the workforce is ill prepared for a globalized economy. That's why education is a live topic in corporate headquarters and why, when reformers such as Kenny come along and have a good story to tell, executives listen.

Kenny clearly knows how to exploit that. One talent that should make her feel right at home in Sun Valley is an ability to schmooze. Village's board of trustees and its ardent supporters include a bevy of big names, such as former General Electric (GE) Chairman Jack Welch, IAC's Diller, Essence Communications founder Ed Lewis, Bill Cosby, Charles Bronfman, Tiki Barber, Rupert Murdoch, Richard Parsons, who is chairman of Time Warner, and Steve Forbes. Many have donated money individually to Village Academies. "She's remarkable and has an incredible self-confidence," says Welch. "Deborah is single-minded about her mission at the schools. She runs a meritocracy that doesn't tolerate lackadaisical performance."

A former Time Warner executive herself, Kenny has applied a business management style to running her schools, focusing on attracting smart teachers, nurturing talent, using reams of data to improve performance, and putting a huge emphasis on rewarding results. In June, she announced that 100% of Village Academies' eighth grade students had passed the state math test, a first for Harlem that was lauded by New York Mayor Michael Bloomberg. "I was proud," says Kenny. "But this should not be some historic, amazing achievement. It should be a given."

Bypassing the Union

Village Academies has gone from one school to three, and from several dozen students to more than 500. Nearly all are black or Latino. The Robin Hood, Gates, and Walton foundations have all given Village money. President Bush visited the schools last year, praising their performance and using the opportunity to bolster his No Child Left Behind education initiative.

Charter schools are essentially autonomous public schools, free to operate outside some of the school district's procedural requirements. They are accountable for student achievement, however, and tend to be located in neighborhoods with the lowest graduation rates. The schools are free to raise funds privately, as well--the split at Village is 75% public funding, the rest private donations.

Giving charter schools even more flexibility is that they are not required to hire union teachers. New York City has 60 charter schools and plans to add another 18 in the fall. Enrollment is by lottery.

After a stint working in the Parenting Group of Time Warner's Time Inc. division and then as a president at Sesame Street Productions, Kenny says she had an epiphany in 1999 after her husband died of leukemia at 37. Holding a PhD from Columbia University's Teachers College, Kenny says she knew she needed to do something "more meaningful" with her life. So she began to explore the idea of launching a charter school, starting first by visiting 25 high-performing schools in the Northeast, private as well as public, to see what they were doing right.

Entrepreneurial Gumption

"The first thing I discovered was that all that matters is the quality of that teacher in the room," Kenny says. She then enlisted the help of about a dozen volunteers to help her write a charter for a school, which eventually won approval by New York State. "I suddenly found myself having to find a building, hire teachers, gain community support, raise money. It was like I was starting a small business."

The first school opened in September 2003 with a group of fifth graders (they will graduate from Village Academies' high school in 2011). Even though she chooses to think of herself as an educator first, Kenny relishes using an executive's approach to her schools. The problem, she says, is that so many other like-minded reformers who have sought to bring business practices to education have thought of schools and students as products.

"In that scenario, the teachers are manual workers," says Kenny. "I see it as a service, and the teachers are knowledge workers. When you think of education as a product delivered by manual workers, you miss the boat. You have to create systems to develop people."

Like Hotel Guests

Many of her teachers are fresh from a two-year commitment to the Teach For America program or have been recruited from New York public schools. She says Village pays starting teachers $4,000 more a year than the public schools and offers performance bonuses of up to $3,000.

Kenny also tells her staff, which now numbers more than 65, that they need to follow the "Ritz-Carlton" model. "We think of the parents as customers, and we pay as much attention to them and pay them as much respect as Ritz-Carlton workers are trained to treat their guests." In turn, Kenny every several weeks puts data for each student onto spreadsheets -- everything from hallway infractions to how often students are late handing in homework. This, she says, enables teachers to see trends and communicate with parents and students before it's too late.

From the start, Kenny's goal has been to try to replicate what she is doing in Harlem in other neighborhoods with failing schools. Says Parsons, who relinquished his CEO post at Time Warner last year: "Deborah is like a person possessed. That is what it takes to move the needle. The challenge -- not just for her, but for all of us -- is whether you can scale the kind of system she has created in Harlem."

But Kenny says she is realistic. "Maintaining a quality leadership position is everything. Growth is second. We will expand as fast as we can, and as slow as we must."

is a senior writer for BusinessWeek in New York.

This piece was originally printed in Businessweek