Why Schools Make Bad Buying Decisions

Why Schools Make Bad Buying Decisions

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Schools buy stuff badly. This spells trouble for education technology. Schools will buy the wrong things, at bad prices and for the wrong students. The result: schools will implement edtech more slowly, results will improve minimally if at all, the wrong technology will prosper and money will be diverted from more effective goods and services. If we want to avoid this future, we need to fix the procurement process now before it’s too late.

Examples of bad personnel management in the public schools are all too common. However poorly designed salary scales and benefit plans may be, they are paragons of efficiency compared to the way school systems spend the rest of their money. American K-12 public schools spend 30% to 40%, approximately $70 billion annually, on curriculum, technology and other support for the classroom. As more of that is spent on education technology, it is imperative that it be spent well.

Procurement has always been an issue for schools. For three years, I ran New York City's school system. I’m currently on the board of Cambium, a major education vendor that sells products for at-risk children to schools. In my experience, most districts do a mediocre job of picking curriculum, and that is their core competency. Is there any doubt that they will do a worse job picking educational technology?

Here's one recent example: a senior executive at Pearson complained that in one district that had resolved only to buy digital materials, the committee that evaluated the Request for Proposal (RFP) submissions made one additional requirement of the bidders: It asked for a physical printout of the curriculum that was included in the digital product. So much for giving any weight to the interactive “touch-and-feel” of the material, the integration of technology and curriculum, production qualities or even the engagement level of the games and videos. In short, old school rubrics triumphed over new tech content and presentation.

There are solutions. The U.S. Department of Education recently issued a report, “ Expanding Evidence: Approaches for Measuring Learning in a Digital World,” that makes some very thoughtful suggestions for evaluating what works cheaply and quickly. Among the ideas suggested: education must capitalize on the trend toward big data and policy makers must learn to use realistic frameworks for evaluation (not exclusively high-priced, randomized testing).

What’s left out of the puzzle, however, is how to make local education agencies smarter, faster and more analytic. It’s good to identify systemic weakness but the core issue is how to get our 14,000 local school boards to become better shoppers. What’s true of the garment industry is also true of school systems: “An educated consumer is our best customer.”

If we're going to do a better job of getting the appropriate materials into schools, we have to understand what the problems have been in the past. Here's my top 10 list of why it's been challenging to do procurement right in the past.

1. Schools lack the critical judgment to discern quality.

All too frequently, the people who are making the buying decisions haven't been in the classroom for years. They're out of touch with what Internet-savvy students expect, newly-trained millennial teachers have the technological capacity to do, and for that matter, what data-sensitive administrators need. Too many RFP committees are composed of last-generation teachers who may be knowledgeable about curricular issues but are hopeless technological primitives.

2. Districts have no awareness of what's "cutting edge."

Districts don't go to industry conferences so they don’t know what to ask for. Almost no principals attend such meetings. And there are only a tiny numbers of teachers who have the time, flexibility and travel budget to go to meetings where they can stay up-to-speed on what industry leaders are doing. If you’re flying blind, why be surprised if you crash and burn?

3. "Brand" all too often has been a substitute for quality

It's like the old "No one ever got fired for hiring IBM" problem. Too many decisions are made based on the recommendation of long-time salesmen, former superintendents retained to “place” product with their district friends, and simple gossip. We must do better.

4. There's nothing like a "Gartner" report to guide schools.

When I was Citigroup’s Director of Global Compliance, we relied on Gartner Group reports to keep up with technological research. That way we would know the trending topics, priorities of other large company chief information officers and applications for big data. School districts, in contrast, make decisions on the seat of their pants. When major corporations buy tech for themselves, they rely on critical evaluations written by third-party evaluators such as the Gartner Group. Schools certainly don't have the funding to afford massively expensive research. But they surely could use better data about what works. We need a Gartner for school districts that’s both authoritative and inexpensive. Private funders have a role here; they can start requiring some demonstrated critical analysis before their money is spent by localities.

5. There are no inexpensive experts to level the playing field.

Education companies employ expensive expert consultants and buy access to subtle databases to figure out which districts have money, which products they have bought in the past, and who makes critical decisions. (Similarly, teacher union affiliates of the AFT share electronically cutting edge contract terms and arbitration decisions.) In contrast, school districts know very little about the special deals that individual vendors have cut with other districts. To level the playing field, school districts need an authoritative, independent, inexpensive, national consultant organization that can advise them on critical purchasing decisions. This consultant organization should be nimble enough to advise individual RFP committees and small district superintendents without schools incurring prohibitive costs. Private foundations have a role here as they can fund such neutral expertise; positive reports would give local superintendents both the analytic capacity to pick edtech well and the political cover to take the risk of trying the unconventional but effective solution.

6. Buying consortiums haven't worked.

In theory it makes sense that smaller districts should team up in making buying decisions to have more clout with big vendors. But it just doesn't happen. District heads seldom are willing to yield their authority to decide what to buy, which is something that has to happen to make a buying consortium work. If the districts don’t hang together, they will hang separately.

7. The lower the level of decision making, the higher the price.

This point really hurts: When teachers are empowered to make choices, vendors wind up giving them the highest prices. So even though they might be the smartest decision makers--and that’s not always the case by any means--it's not cost effective for the districts. Districts need to pull their tech-savvy teachers into participating in central decision making; the result couldn’t be worse than using the existing system where the dinosaurs do long range planning.

8. Uneven quality.

Some teachers are great teachers. Others are not. Software can amplify great teaching but it doesn't turn mediocre teachers into great ones. We keep saying that we know that technology isn't a silver bullet. But we act as though we believe it really is. To avoid edtech becoming the next edfad, we need to recognize not all teachers or technologies are created equal.

9. Buying the wrong tech means bad tech wins.

Investors want sales. So when districts buy products based on good salesmanship or following a trend, traction trumps real quality. Pedagogy gets marginalized. Students suffer. Edtech becomes glitz, not a learning tool. Buying decisions can’t be based on gossip and guess; the consequences are too important.

10. Big salesforces win.

Big salesforces have long determined what products are used in the classroom. The result: Small innovative products wither, there’s less K-12 investment overall, there’s slower uptake and there’s slower improvement of student outcomes.

The overall message is clear: we need to fix procurement so that the most effective products prevail. In the current system, the best product doesn’t necessarily win. Edtech is too important a pedagogical tool not to get it right. We need to fix procurement now.

Harold Levy served as New York City's chancellor of public schools (2000-2002), executive vice president of Kaplan, and is now managing director of Palm Ventures, a family office that invests in education businesses.

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