April 23, 2014

How online content development and delivery could improve the productivity of post-secondary education

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Content development at Laval University

Content development at Laval University

This is a continuation of the exploration of the potential for online learning to increase educational ‘productivity.’ Previous posts in this series include:

In the last post, I made the following observations:

  • there are specific types of learning outcomes expected from higher education. These outcomes should drive teaching and technology decisions, not the other way round, although there is a symbiosis between outcomes and technology that needs to be considered
  • these outcomes require certain kinds of teaching methods or approaches to learning, and online learning needs to be able to accommodate or support such approaches. This will mean exposing the ‘magic’ of on-campus learning and seeing if this can be defined and recreated in an online environment.
  • I argue that much of this has already been achieved in online learning through good course design, which in itself is a key factor in improving productivity in higher education
  • to get increases in productivity we need to examine which online learning activities can be re-designed to move from variable to fixed costs, while still maintaining or improving on the core learning outcomes expected of higher education.

In this post, I disaggregate the activities encompassed in online teaching, to identify those that are easily scaled (and hence can lead to reductions in unit costs), and those that are either currently difficult to scale, or indeed should NOT be scaled.

Not all productivity gains though can be related to scaling up activities. Some can be achieved by redesign of operational processes to make them more efficient. This aspect will be discussed in further posts.

Disaggregating online teaching

Online teaching encompasses a range of activities, each with different cost structures. Some are one time or fixed costs, independent of the number of learners. Others are ongoing or variable costs, that are directly related to the number of learners.

For the purpose of this discussion, I will break online teaching down into the following activities:

  1. Content development and delivery
  2. Student activities
  3. Learner support
  4. Assessment
  5. Planning, administration and overheads

For each of these activities, I will look at possible ways to improve productivity, depending on their potential for scaling up. I will focus in this post on the potential for productivity gains through online content development and delivery, and will deal with the other three set of activities in later posts.

Content development and delivery

Nowhere in online learning is there such potential for increases in educational productivity as in content development and delivery. Once learning materials are created, they can be stored, accessed, delivered and used by an unlimited number of learners, thus potentially achieving large economies of scale and thereby reducing costs per learner.

MOOCs are a classic example of economies of scale. Once lectures are ‘captured’ they can be stored and accessed by anyone with high speed Internet access. xMOOCs in particular have another ‘productivity’ advantage, in that they can also achieve economies of scope, in that the lectures would have been prepared and video-captured in any case for on-campus students, and thus once produced they can also made available to the rest of the world at technically little or no extra cost. Thus the cost of conversion from on-campus to online is less than it would have been if there was no on-campus version. (However, we shall see below that there are additional costs in creating xMOOCs compared to online credit courses).

Even for online courses for credit, there are considerable economies of scale in course development and delivery. Once course materials have been created, costs are usually less for subsequent offerings of the same course, as some content remains unchanged. However, there will be some ongoing costs (course maintenance) as content changes over time. Nevertheless compared to offering a new version of the same course each year on campus, there are more economies of scale for online content delivery.

Another important factor contributing to economies of scale in online learning is the increasing availability of open educational resources. Particularly in foundational courses and many ‘standard’ undergraduate courses, material is already available and does not have to be created. This may even be available increasingly through open online textbooks. The main cost is selecting and organizing existing open source materials, and even some of these costs can be passed on to students at more advanced levels.

Limitations to economies of scale in online content

As always, there are trade-offs to be made between lowering unit costs and reducing quality. Several factors constrain the bounds of economies of scale or economies of scope in online learning:

  • rapidly developing new knowledge: the need to keep courses up to date means that courses cannot or should not be created then left untouched for several years. In many areas of learning these days, regular course maintenance is essential, thus reducing (but not eliminating) the economies of scale
  • in order to achieve high quality, and because economies of scale enable costs to be spread over a larger number of students, development costs for online content tend to be higher than for classroom teaching
  • thus there is always a minimum number of students required to justify the higher initial fixed cost of creating online content. Put another way, economies of scale require a large enough market to justify the initial investment. For credit courses, experience suggests that at least 25 students per course offering are required. Thus for many specialist online courses for credit at third or fourth levels, there may not be the market to benefit from large economies of scale, although for MOOCs, this is not usually a limitation
  • on the other hand, there is evidence that content development for MOOCs is at least two to three times the cost as for credit courses. For instance the University of Ottawa has costed Coursera-type MOOC course development at $100,000 per course; UBC has set aside $500,000 for the development of 5 MOOCs. On the other hand, course development for LMS-based credit courses has been costed at around $35,000-$50,000 per three credit course (see Bates and Sangrà, 2011). xMOOCs of course could be produced at much lower cost than at present, but there is always some cost involved, at least in terms of instructor time and technology
  • institutions may not have the resources to achieve economies of scale. If most of an institution’s budget is tied up in salaries linked to contractual agreements, there may not be sufficient resources to make the investment that will lead to economies of scale in course development. Sometimes it is necessary to speculate in order to accumulate.
  • economies of scale need to be related also to output. Achieving economies of scale is pointless if output goes down. In education, economies of scale need to be matched by learner performance. In other words students should perform just as well at lower unit costs, or better for the same unit cost. xMOOCs in particular have yet to achieve this, at least on a large scale (it should be noted that while xMOOCs are free for learners, they are a substantial cost to the institution developing and delivering them.)
  • perhaps more surprising, content development and delivery has to date been a relatively small component of the costs of at least credit-based online learning. Bates and Sangrà (2011) calculated that course development and maintenance costs were less than one-fifth of the total cost over seven years of a fully online master program. Learner support and assessment was over one third of the cost and program administration and university overheads constituted just under one third of the cost. Probably the biggest difference economically between cMOOCs and xMOOCs is the difference in costs of course development and delivery, although as with all open resources there are major hidden costs in cMOOCs (i.e. the time of those contributing to the courses).

Improving productivity in online course development and delivery

Basically there are two ways to increase productivity: reducing unit costs (i.e. cost per student) or improving output. There is evidence that for markets/courses/programs where there is a large number of potential students, online content development and delivery has potential for greater economies of scale than campus-based teaching, more so for MOOCs than for credit-based online courses/programs (mainly because MOOCs can reach a much larger market).

What is more challenging is to think of ways we could further improve the productivity of online learning through content development and delivery, especially for credit-based learning. Here are some of my suggestions:

  • greater use of open educational resources, especially ‘core’ foundation content. This may take the form of ready-made content that can be adapted for local use, such as the Carnegie Mellon Open Learning Initiative, or open textbooks. Perhaps in addition to open educational resources in the form of small packages of content, we should also be developing some open curriculum design frameworks into which OERs could be dropped. This would help speed up and lower the cost of online course development, and also enable rapid developments in content to be more easily handled
  • increase the market for a particular online course or program. This could be done in several ways. One is to open up admission requirements to a larger number of students, while maintaining or increasing the standards of performance. Thus easy to get in, but demanding to qualify. Another is through collaboration or consortia. Online learning is accessible anywhere in a state, province, country or internationally. The Ontario government is already questioning why several institutions in the same area should offer the same programs on different campuses. With online learning, the question becomes even more pertinent. Why not offer one, two or three foundation psychology courses online throughout the province, with different institutions providing the ‘local’ online support and student assessment? In all these cases, more money could be spent on developing really high quality content and courses, but with major lowering of unit costs for production and delivery (we shall see that learner support costs are another matter)
  • look at ways to reduce the costs (or achieve economies of scale or scope) in other areas, such as learner support, assessment and program administration/university overheads, since they constitute a higher proportion of overall cost than course development and delivery. This is essentially what MOOCs have done. The problem is that they have done it without ensuring that students can still handle the courses. In later posts, we shall see that getting productivity gains in these other other components of online teaching is much more difficult than in content development and delivery
  • focus in online courses on ’21st century skills’ development, such as knowledge management and independent learning. This would have two benefits. It would improve outputs (turning out graduates with the skills needed). Second, content development and delivery becomes subsidiary to helping students find, analyze, organize and apply content themselves. Thus less time would be spent by instructors on course development and delivery.

I am sure you can think of other ways in which we could make online content development and delivery more productive. If so, let’s hear it!


Some of these will be contentious (I hope) so let’s hear from you on this, but here are my thoughts as a result of going through this exercise:

  • understanding the basic cost structures of online learning, compared to classroom teaching, is an essential first step to increasing productivity in post-secondary education. It is risky to assume that online learning is always more cost-effective or productive; the circumstances need to be right
  • already, in certain circumstances (i.e. where there is a large market), online content development and delivery is already resulting in increased productivity in post-secondary education, although it has yet to be well documented and publicised (except for MOOCs)
  • at the same time, there is still room for even greater increases in productivity through online course development and delivery, especially through the use of open educational resources and sharing of content across different institutions
  • online content development and delivery is only one component of online teaching; other components such as learner support and assessment are even more important
  • care is needed then because changes in methods of online content development and delivery could have knock-on cost and productivity consequences in other areas of course delivery, such as learner support and assessment. In looking at productivity issues, all these factors need to be examined together
  • any attempts at scaling or increasing economies of scope in content development and delivery need to be balanced by ensuring quality does not suffer. However, online course development has the potential, through good instructional design, to improve quality rather than reduce it

Lastly, so far for me this has been a journey of exploration. I don’t claim to be an expert on productivity, and, as in this post, I’m not always sure where I will end up when I start. I am beginning to think though that it is a productive exercise (sorry for the pun), but I’m not sure if this view is shared by you, the readers. So any comments, feedback or criticism will be welcome, as always.


Bates, A. and Sangra, A. (2011) Managing Technology in Higher Education: Strategies for Transforming Teaching and Learning San Francisco, Jossey Bass, 2011


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