In an earlier blog, Struggling with Costs of Teaching in Higher Education, I complained about the lack of research into the costs of teaching, and particularly the lack of research into the costs of e-learning in post-secondary educational institutions. Well, some of you came to my rescue. In particular, Burkhard Lehmann directed me to the following:

Laurillard, D. (2007) Modelling benefits-oriented costs for technology enhanced learning Higher Education, Vol. 54, No. 1, pp. 21-39

Now Diana is a former close colleague of mine in the early 1980s when I was a professor at the U.K. Open University, so I was not surprised that this article provided not only an excellent and comprehensive review of the literature on the costs of what she calls technology-enhanced learning, but also a description of her own ‘benefits-oriented cost model.’ (But I was surprised I didn’t know about it). I may have some quibbles about what she sees as the main benefits of technology-enhanced learning and how she would measure it (she emphasises particularly ‘personalization’), but nevertheless it was really good to find all the work in this field  brought together and thoughtfully critiqued. Thanks, Diana – and Burkhard!

In the end, though, I realised that for the purposes of my chapter, I was looking at something somewhat different from what Diana, myself and others have been doing with research into costs, and that is, how decisions are made about the allocation of resources. In essence the research on costs looks at the what – what was spent – not the ‘how’: how were decisions made about this.

My problem is that we didn’t collect very good data about this from our 11 case studies, and if there isn’t much research on costs in the literature, there is even less on how such decisions are made. However, here’s what we did find.

1. About half of the institutions in our case studies found substantial amounts (over $1 million) to kick start or develop e-learning, from ‘off the top’, that is, before allocations to spending units, such as academic departments or building maintenance. Anything less than this did not produce significant, sustainable developments. Furthermore, at least half the institutions were spending substantial amounts every year through the general operating budget and departmental budgets in supporting technology-based teaching (for instance learning technology support units, grants to faculty, faculty development, etc.). However as researchers we did not identify how much.

2. For regular, sustainable operating funding for technology-based teaching, it remains a mystery to me where the money comes from. Well, not so much where it comes from, but what was given up to find it. A typical comment from a senior administrator responsible for developing e-learning would be: ‘I don’t know where the money is going to come from, but we have to do it.’ However, I think the assumption was that instructors would give up doing some things so that they could spend more time on e-learning, but since the main goal in the nine campus-based institutions was to enhance the traditional classroom teaching, we think that this in most cases did not happen.

3. This raises then the question: what did? I have a nasty feeling (and no evidence) that the resources came from the following: increased instructor workloads (more time spent teaching, because of the technology); or larger classes (fewer instructors hired to pay for learning technology units, for instance); or an increase in the proportion of lower cost adjunct faculty; or a slowing down in the number of new courses or programs; or a combination of all of these. However, we don’t know, because there is no data, and most institutions are not able or willing to measure this. Our conclusion: be clear as to where the money should come from, and deliberately reallocate from those areas, if you want to avoid unpleasant unintended consequences. Put another way, don’t add technology on to the classroom: use technology to replace time in the classroom, if you wish to use it cost-effectively.

4. Current financial reporting systems are inadequate for tracking the true costs of e-learning. E-learning, like research, lectures, laboratories, committee meetings, and field trips, is an activity, but financial reporting is based on spending units or departments, not activities. So we know the cost of paying professors, but not the cost of their activities. If we want to know how much we are spending on technology-based teaching, we need to know how it affects the work of instructors. We argue for the ability to do activity-based costing by collecting and storing financial and other data in such a way that it can be reanalyzed for activities by using business intelligence software.

5. There are ways to control the costs of technology-based teaching, but this means changing the way we design, develop, and deliver courses, as well as having better ways of tracking costs.

6. You have to look at benefits and unintended losses as well as costs – but we don’t identify clearly the intended teaching benefits of technology or if we do, we don’t measure the extent to which we have successfully achieved them, and relate costs to them. It may be worth spending more money on technology, but not if you can’t say what the benefit is. You also have to check for unintended consequences.

Are there administrators out there who have been grappling with the issue of resourcing technology-based learning? How have you gone about it?

Does this equate with your experience or have I lost the plot?


  1. “4. Current financial reporting systems are inadequate for tracking the true costs of e-learning. E-learning, like research, lectures, laboratories, committee meetings, and field trips, is an activity, but financial reporting is based on spending units or departments, not activities.”

    It’s not that financial reporting systems (at least many of them) in higher education cannot track costs by activities, it’s just that in many cases this is not done routinely but rather only for “special” considerations. At least that’s been my experience. Others can no doubt offer more insight.

    What you’re trying to do (ie, understand the decisions behind resource choices) seems very difficult to do except possibly as case studies. And even then you’d need extraordinary access to the people making those decisions. Seems like the access would also need to be “real-time” instead of after-the-fact when the spin factor can rationalize almost anything.


  2. Burkhard Lehmann comments:

    Cost (when you think in terms of money) deal with the world of objective things we can measure: Time, speed, resources. ..
    In the world of teaching and learning we normally deal with subjective things. Nevertheless we can formulate some more general criteria:

    Rate of success
    Rate of duration
    Average of grades and so on.

    But we also know, that for example success is determined by many different factors. There is no strong relation to technology or a special teaching approach. The problem we deal with is not totally new: When they introduced black boards in the classroom or overhead projectors where they able to calculate cost and benefits? I’m not sure.
    I think that in general there is no satisfactory solution for this problem. But you can calculate the cost and benefits for some special technologies. So for example introducing e-exams. Or you can look for savings on the administrative side of the University. There you can see how the investment in technology works.

    Burkhard Lehmann
    Technische Universität Kaiserslautern
    Distance & International Studies Center (DISC)


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