Outsourcing is In

Outsourcing is In

More districts are hiring outside firms for everything from after-school tutoring to writing curricu

Nearly half of the students at the McDonald County R-1 School District went to optional summer school for most of June this year-kids who were falling behind, kids at the top of their class and kids in between. Six years ago, the 3,800-student district in southwest Missouri began offering "Summer Adventure" when it was on the verge of being unaccredited due to its test scores. It's worked. Test scores are up, and this summer McDonald County was accredited with distinction. "Summer Adventure had something to do with that," says Superintendent Randy Smith. "It's hard to separate out all the changes and give them exact due, but I know the program has played a big, big role."

It's a nice success story for the McDonald County district, but they can't take all the credit. Summer Adventure isn't run by McDonald County. It's a program that's now in place in about a quarter of the school districts in Missouri and is run by Newton Learning, a division of Edison Schools. In the spring Newton brings magicians and skits to every grade to get kids excited to sign up. The company provides the curriculum, trains the teachers, delivers all the necessary materials and helps administer the classes. And after the session is over, Newton polls the parents to see how it went-this year, more than 90 percent said they'd recommend the program to another parent.

Summer Adventure is only one of several programs offered by Newton, which is itself only one company in the burgeoning field of educational outsourcing. School districts hire companies to run their bus service or balance the books-and since the 1970s, many school districts have looked outside their payroll for help with the special instruction required for some special education. But more and more, districts are hiring an outside firm for everything from after-school tutoring to college counseling, from analyzing test scores to writing the curriculum (see sidebar on page 56).

"It's not only schools-every organization in America is moving in the direction of outsourcing," says Arthur Levine, the former president of Teachers College in Columbia University and now the president of the Woodrow Wilson National Fellowship Foundation. "Here's an analogy: I have an internist that gives me tests, but periodically she makes a diagnosis and thinks I should see a specialist. Why wouldn't you sometimes call in a specialist, find the best people you can for a job?"

The Federal Mandate That Keeps Giving

When it comes to educational outsourcing, the big player in the field over the last few years is Supplemental Educational Services, which provides tutoring for low-income students required by No Child Left Behind for schools that have not met state performance goals for three consecutive years. Although the law says eligible schools must spend 20 percent of their Title I money on SES, if enough children don't sign up for the voluntary tutoring, schools can keep the money in-house. SES participation among eligible students was at 12 percent during the 2003-2004 school year, increasing to 19 percent in 2004-2005, according to a recent report by the federal Government Accountability Office.

" It's not only schools-every organization in America is moving in the direction of outsourcing." -Arthur Levine, president, Woodrow Wilson National Fellowship Foundation

While some districts fight the requirement to spend district dollars on outside tutors, most notably Chicago, others are glad to have a hand. "With anything new, you see a continuum of adaptation. We've seen a lot of schools embrace the opportunity to work with another entity to help kids in the school narrow the achievement gap. We see ourselves as a piece of the puzzle, not a silver bullet," says Marcy Suntken, president of Knowledge Learning Corporation School Partnerships. "Our goal is to work with schools that want to partner with us."

In August, Suntken's firm purchased SES provider Education Station from Catapult Learning, increasing the percentage of its business that's SES related to about half and providing tutoring services to more than 300 districts nationwide. In total, there could be about $2 billion a year in SES billing for the approximately 1,000 schools that have been required to implement SES, although the annual total right now is about $350 million.

The lure of big-time federal funding has proven to be a boon to the education outsourcing industry. "The amount spent on SES is growing rather significantly," says Tim Wiley, a senior analyst for K-12 at Eduventures, a firm that provides education market analysis. "It's a huge market. There are at last count 1,800 providers that are approved by one state or another. It's also a very fragmented market. Over 90 percent of the firms are in only one state-and in many cases only a handful of districts."

Why Outsource?

Experts say that SES has had another effect on educational outsourcing by simply highlighting the option of bringing in an outside resource. "No Child Left Behind has been a watershed because it explicitly endorses the whole notion that a variety of organizations should help kids with academic proficiency," says Steve Pines, the executive director of the Education Industry Association.

Sometimes the reason to bring in an outsider is as simple as not having the personnel on hand to get a job done. For the past two years in the Plano (Texas) Independent School District, at-risk students in the 9th and 10th grades have been able to access an online algebra tutoring service provided by Socratic Learning. "We needed to make a bigger impact that our own staff could provide," says Doug Otto, the district superintendent, who adds that the program has been very successful. "There were a limited number of algebra teachers we had who were available to tutor. It was a function of being able to reach out and get as many tutors as we needed."

More often, administrators reach for the phone when faced with an intractable problem, or one that requires some expertise that isn't readily available in-house. Princeton Review's Formative Assessment Program, which provides low-stakes tests for students to monitor progress toward state standards throughout the year, is a good example. "We don't see school districts with the ability to build this kind of system themselves," says Kevin Howell, the executive vice president and general manager for the firm's K-12 services division.

While schools can and do create their own curricula, education outsource firms can offer a specialized syllabus for students who are falling behind. Princeton, Catapult and Kaplan K12 all provide a packaged, step-by-step guide to presenting information in a way to reach students who are behind grade level. At the other end of the spectrum, several firms work hand-in-hand with a district to create a bespoke curriculum for all students in the district. In each case, districts are looking for a specialist that has extensive experience in a field where they're struggling.

"Over the last 20 years, the size of curriculum and instruction departments [at the district level] has really shrunk. Part of what we do is provide the capacity they might not have in-house. Plus, we have the ability to look broadly across districts and bring the best procedures and thinking to the table," says Seppy Basili, the senior vice president at Kaplan K12 Learning Services, which has worked on the core curriculum with nine large school districts over the last four years, including St. Louis, Philadelphia and Chicago, which has hired seven different educational outsource providers in its multiyear program to completely rewrite and codify its high school curriculum.

Close Quarters

Basili insists that the work Kaplan K12 does in core curriculum is better characterized as a partnership than outsourcing, with a team of as many as a dozen of his staff working for months or more in close concert with district personnel, and outsourcing firms tend to approach the work in the same way. Pamela Latt?, the director of SES Operations for Huntington Learning Center, says that she gives advice on how a school is working and what to change at the 33 districts where Huntington has SES operations on the East Coast. "I've had principals ask if I want a desk in their office. I've had them ask for help writing grants to apply for federal funds," she says.

In many cases, the line between outsourcing and district work is blurred because the personnel are one and the same. In McDonald County, for example, the Summer Adventure positions are filled with district teachers, and many SES programs that work within the school building hire teachers from the school as the tutors. It might seem odd for a district to hire an outside company to bring in its own teachers to work with students, but administrators like Smith point out that the outsource firm has its own curriculum and administration-and that the training teachers receive to follow the outsourcing program ends up as unofficial professional development on other teaching methods.

Of course, educational outsourcing isn't for everyone. John Chubb, the chief education officer for Edison Schools, says that he can see a difference between how district decisionmakers approach the wide array of services his firm offers. The firm's test program in its Tungsten Learning division is generally easily accepted, whereas the "thin management" Edison Alliance model, which is only a step removed from how the firm completely administers schools in districts like Philadelphia, is more controversial.

"If you think about schools as a series of concentric circles, with core competencies to more supportive activities to the incidental, the level of controversy depends on how close you are to the core," Chubb says. "Districts don't write their own textbooks, so for us to bring in an assessment system isn't radically different. But it's much more controversial for us to be bringing in teachers."

Even when there is little or no controversy, educational outsourcing can be undone by budgets or other restrictions. Superintendent Smith in Missouri says that the Summer Adventure program essentially pays for itself by bringing in state dollars for each extra day the students are in school. But an outsourced after-school tutoring program was discontinued when the state provided a new grant that covered the cost-but only for an in-house program.

And for some districts, there just isn't an interest in calling for outside help. "Our staff knows our kids best, and they know our community, and they know our curriculum," says Arnie Glassberg, the superintendent of the 11,500-student San Lorenzo, Calif., school district, where the district itself provides SES after-school tutoring. San Lorenzo also recently significantly restructured its schools in pursuit of better academic performance, including a new curriculum more focused on English and math and intense instruction for students testing more than two years behind their grade level. Here too, the work was done in-house.

"We're a very collaborative district, working with the teachers, administrators and experts we have in a standard process to generate recommendations to the board, and that process has served us well over the years. I want to be proven wrong about using our own folks before bringing in other folks," Glassberg says, before stopping to laugh. "But if this doesn't work, then yes, I'll give a call for help." DA

Carl Vogel is a Chicago-based writer.


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