The Pennsylvania State World Campus adopted a budgeting system that includes the costs of faculty compensation, instructional design, faculty development activities, marketing, and student services administration.
Pennsylvania State World Campus has adopted a budgeting system that includes the costs of faculty compensation, instructional design, faculty development activities, marketing, and student services administration. An important question relating to cost effectiveness is, "Are the educational outcomes worth the cost?" The tradition in higher education is to price programs based on cost recovery. The World Campus has made a commitment to value-based pricing, which is based on the value of the program in the marketplace. The World Campus is seeking both cost-effectiveness (achieving the desired benefits at an acceptable cost) and cost-efficiency (improving the ratio of cost to benefits) in all of its core functions, including instructional design, student services, administration, and marketing. For example, cost efficiency in marketing is being achieved through two methods. The first is to improve the efficiency of staff time in the marketing process. The World Campus partners with Outreach Program Development Services to staff the marketing function. Several dedicated Program Marketing Managers spend full time developing and implementing marketing plans for individual programs and for the World Campus as a whole. They call on specialists in three central units--Marketing Research, Marketing Communications, and Client Development--for professional resources. Marketing Managers are assigned to projects by a percentage of their time. However, the centralized staff is funded through a general percentage of the budget; the Outreach Director of Marketing is then responsible for managing the efficient use of these centralized resources. The second method has to do with the marketing strategy itself. World Campus programs tend to be specialized professional programs that appeal to niche markets. Marketing these programs is inherently inefficient, because there are little overlaps between programs. To maximize efficiency, the World Campus originally adopted a "viewbook" strategy in which all World Campus programs--along with other Distance Education offerings--are included in a single response piece that can be customized with inserts for individual programs. In 2001, this is further refined, with the viewbook replaced by a postcard as a search piece. Increasingly, the web itself is becoming the default response tool. Similarly, sales campaigns are being organized around specific markets--the military, education, and employers--who have interest in multiple programs. The World Campus continues to evolve its services as it expands and grows.
At the three-year milestone, the World Campus business plan is on track to meet the goal of becoming a self-sustaining campus of the University that will generate revenue to cover its costs and to produce new revenue streams to support innovation in participating academic units. Details of the World Campus approach to cost effectiveness are available in Online Education: Learning Effectiveness, Faculty Satisfaction and Cost Effectiveness, Volume II, SCOLE, 2000.