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What Happens When a Public University Buys a For-Profit Online One?

By Jeffrey R. Young     Jun 27, 2018

What Happens When a Public University Buys a For-Profit Online One?

When leaders of Purdue University wanted to move into online education, they took the unusual step of buying an existing online university, a big one with 30,000 students. And here’s the most surprising part: that online school it bought, Kaplan University, was a for-profit business—part of a sector that’s been criticized for high costs and poor outcomes for students.

It’s hard to think of another example of two more different higher education cultures placed under the same name.

The deal sparked vocal protests from Purdue professors, and hundreds of them signed petitions opposing the arrangement, calling it an unprecedented privatization of public education. Purdue leaders, meanwhile, say that Kaplan has better outcomes than other for-profits and that it serves an important audience of adult students who aren’t able to go to a traditional campus.

The ownership structure of this new online entity, which is called Purdue University Global, gets confusing. Kaplan University had been owned by Graham Holdings Company, which used to own the Washington Post until it sold it to Jeff Bezos. A division of Kaplan continues to provide services to this new Purdue online institution, and will get a portion of the tuition revenue in exchange for that. (And in full disclosure, Graham Holdings was an early investor in EdSurge, though they’ve had no hand in our editorial operations.)

This month Purdue University Global held its first graduation under the new banner. But what exactly is different now at the online institution, and how does this whole thing work?

To try to get some answers, EdSurge talked with Betty Vandenbosch, the chancellor of Purdue University Global, who had been leading Kaplan University for the past few years. It’s clear that the two institutions remain very different places, even as she named a few examples where the two are beginning to work together.

Subscribe to the EdSurge On Air podcast on your favorite podcast app (like iTunes or Stitcher). Or read highlights from the conversation (which have been edited and condensed for clarity).

EdSurge: Purdue made news last year when it purchased the for-profit Kaplan University. I imagine people may be curious about how this works. First, can you paint a picture of what Kaplan University is and who it serves?

Vandenbosch: We are a university in the neighborhood of 30,000 students, divided into six schools and colleges. We have a law school, we have a school of business and information technology, we have a college of social and behavioral sciences, we have an open college, and we have health sciences and nursing.

And it is mostly online?

It is virtually all online. We have some small programs for pre-licensure nursing and medical assisting for obvious reasons, those have ground-based components. But other than that, everybody is online, and everyone goes to school via the web.

That is what Purdue leadership said interested them about Kaplan—your experience delivering online education, which Purdue hasn’t done much of. But what's different today, as Purdue University Global than a year ago when you were still called Kaplan?

What's different because of our relationship with Purdue is that we now have access to real thought leaders in some of the disciplines that we're very excited to be able to participate in. For example our board of trustees just approved for us to offer a program in cloud computing. And, we are going to be working with some folks from Purdue Polytechnic to make sure that the cloud computing [program] is at the leading edge of cloud computing technology.

With the skills in STEM on the Purdue campus at West Lafayette we really have an opportunity to bring that learning and that forward thinking to all of our students at Purdue Global as well.

Another example is we now have one one alumni association. And what that does is it gives our students the opportunity to connect and interact with Purdue University graduates and alumni. It also gives Purdue alumni the opportunity to interact with our students and with our institution in ways that weren't possible before. And I believe that's to the benefit of both institutions because of course more connections with more people is going to strengthen their careers and their lives in society.

I'm curious what attracted you to a for-profit university and particularly Kaplan in your career? You could have gone to other places and you worked in others before that?

I spent 15 years in traditional education. I was a tenured faculty member, I was an associate dean at Case Western Reserve University—a very, very good university with excellent students, and I had a terrific experience there. But when Kaplan came calling, I realized that what Kaplan was doing was something else. It was helping our society increase the education of people who are underserved. The adults who started university when they were perhaps the same age as we started university at but didn't finish, the adults that didn't have an opportunity to finish university, and adults who had lots and lots of really strong experiences, but they hadn't had credit for them. And the opportunity to help those people make that change in their lives was just what I was meant to do.

The other reason that I joined Kaplan University is I'm very, and continue to be, very excited by how quickly we can make things better. We come up with an idea, and we can implement it really, really quickly so we can move our institution forward, much more quickly than most traditional universities do. Early in my career I was a management consultant, and so I have sort of a bent for action. And Kaplan University really gave me the ability to make things happen.

You’re unusual for having worked extensively in both for-profit and nonprofit colleges. So you may not be surprised that many faculty at Purdue have raised concerns about the deal to purchase Kaplan University and to create this Purdue University Global. Some have signed petitions laying out their concerns. What is your basic response to these criticisms?

My initial response is, well, of course they're going to be concerned, and they should be concerned because it's their institution and it's the integrity of their institution that some would say is up for grabs. If I had been a faculty member at Purdue University and had only read the press about for-profit universities, I don't know if I would've ended up in the same place. But it's very understandable because there has been a lot of negative press about the for-profit world, and not all for-profit universities are the same, just as not all nonprofit universities are the same.

It has taken time, and we'll continue to work on this, although most of the concerns have dissipated. But they had to get to know us, they had to get to know what we stand for and how we manage quality in our classrooms, how we maintain the integrity of our academic standards. And as we have come to know each other, we've come to grow and appreciate both the similarities and the differences between our respective campuses.

It's something that learning about each other will bring us both to stronger places. There are many things that Purdue does very well, and there are some things that we do that Purdue can learn from.

Purdue leaders have said they want to learn from the online workings and what Kaplan has done. Are there any concrete plans yet, or could give any examples of what might be specifics of ways the Purdue Global might interact with the physical Purdue campuses?

It's very early. We're working with distance education at the Purdue campuses and describing to them how we put curriculum together, how we think about assessment, how we help support our students through their journey. But for me to point to something and say "And in the past 90 days, here's what we've already accomplished." That's a little bit premature.

It'll be interesting to see where those conversations take you. Can you give one example of something the way Purdue University Global does things that may be a little different than any traditional university would?

We have a different approach than most institutions in how we create our curriculum and how that gets moved into the classroom. We have a system where the faculty create the curriculum together, so all faculty who teach a particular course—let's say, introductory composition—work together under the leadership of one faculty member to evolve the content of that curriculum, and then they all teach the same curriculum. The beauty of that is that enables us to look at how well the curriculum is doing, how well our students are doing, how well our faculty are doing, and we can do research to evaluate different ways of approaching the teaching or the curriculum in a particular course.

That enables us to say "Well that doesn't work as well as this does." And then improve our courses as a consequence. We can do that because we have everybody doing things the same way. In a traditional institution, of course, faculty teach their own courses. Sometimes they collaborate on textbooks, but because there isn't one classroom that everybody agrees on, it's harder to test and improve, and that's something that we're bringing to Purdue. Our approach, we call it the Research Pipeline, we're bringing that approach to Purdue, and we expect that we will be able to take some of the innovations that the folks at Purdue have created, and test them to see if they work in a large scale.

A lot of traditional professors might object to that kind of standardization. But you're not saying that would come to the Purdue campuses?

No, no, no. I'm not saying that at all, what I'm saying is because we have standardized. There are real opportunities to test, and the consequences of those tests can then be brought back to Purdue. To say here's what we found with our students in our environment, and then Purdue faculty can learn from that and decide whether or not to incorporate those into their classes.

Do you think Purdue faculty might be teaching in Purdue Global, and vice versa?

You know, it's always something that's a little bit complicated because of employment rules and so on and so forth. We are really clear about what we expect of our faculty, we hire faculty based on their credentials, their experience in the classroom, and also their empathy to our students. And I believe that there are many faculty at Purdue who might be interested in doing that on an ad hoc basis. So, yeah it's a possibility. Again, it's early days, and we'll evolve that as we move forward.

The arrangement between Kaplan and this new Purdue Global University can be confusing. Is there a simple way of explaining where those lines are?

Yes. I think so. The way that it works is that everything that's directly part of the university is now part of Purdue Global. So, that's everything to do with teaching and learning, that includes obviously the library, curriculum, faculty, our learning management system, everything we do to support our students in the classroom. Kaplan Higher Education, which is an arm of Kaplan, which is an arm of Graham Holdings, provides back-office support. So they run technology for us, they help us with facilities, they do marketing with us, they manage the initial admissions process, they provide student support, they have a 24-hour hotline, they manage all that stuff.

You referenced earlier challenges and problems in the for-profit university sector over the last several years. Could you talk about what it is about Kaplan that is different?

There are 157 things, but the two main things I believe are the long-term orientation. We are not here to make, or we weren't, to make the next quarter's numbers, we are here to teach students. A strong, strong example is that students can come to school for three weeks—no questions asked, no money changes hands—to be sure that Kaplan University and now Purdue Global is right for them. We don't want students to have to invest in something that they don't know is going to work with their lives, and with what's going on with them personally. We have not taken millions of dollars in revenue to ensure that students come to school fully aware of what it takes, how much time they're going to have to spend.

Community

What Happens When a Public University Buys a For-Profit Online One?

By Jeffrey R. Young     Jun 27, 2018

What Happens When a Public University Buys a For-Profit Online One?

When leaders of Purdue University wanted to move into online education, they took the unusual step of buying an existing online university, a big one with 30,000 students. And here’s the most surprising part: that online school it bought, Kaplan University, was a for-profit business—part of a sector that’s been criticized for high costs and poor outcomes for students.

It’s hard to think of another example of two more different higher education cultures placed under the same name.

The deal sparked vocal protests from Purdue professors, and hundreds of them signed petitions opposing the arrangement, calling it an unprecedented privatization of public education. Purdue leaders, meanwhile, say that Kaplan has better outcomes than other for-profits and that it serves an important audience of adult students who aren’t able to go to a traditional campus.

The ownership structure of this new online entity, which is called Purdue University Global, gets confusing. Kaplan University had been owned by Graham Holdings Company, which used to own the Washington Post until it sold it to Jeff Bezos. A division of Kaplan continues to provide services to this new Purdue online institution, and will get a portion of the tuition revenue in exchange for that. (And in full disclosure, Graham Holdings was an early investor in EdSurge, though they’ve had no hand in our editorial operations.)

This month Purdue University Global held its first graduation under the new banner. But what exactly is different now at the online institution, and how does this whole thing work?

To try to get some answers, EdSurge talked with Betty Vandenbosch, the chancellor of Purdue University Global, who had been leading Kaplan University for the past few years. It’s clear that the two institutions remain very different places, even as she named a few examples where the two are beginning to work together.

Subscribe to the EdSurge On Air podcast on your favorite podcast app (like iTunes or Stitcher). Or read highlights from the conversation (which have been edited and condensed for clarity).

EdSurge: Purdue made news last year when it purchased the for-profit Kaplan University. I imagine people may be curious about how this works. First, can you paint a picture of what Kaplan University is and who it serves?

Vandenbosch: We are a university in the neighborhood of 30,000 students, divided into six schools and colleges. We have a law school, we have a school of business and information technology, we have a college of social and behavioral sciences, we have an open college, and we have health sciences and nursing.

And it is mostly online?

It is virtually all online. We have some small programs for pre-licensure nursing and medical assisting for obvious reasons, those have ground-based components. But other than that, everybody is online, and everyone goes to school via the web.

That is what Purdue leadership said interested them about Kaplan—your experience delivering online education, which Purdue hasn’t done much of. But what's different today, as Purdue University Global than a year ago when you were still called Kaplan?

What's different because of our relationship with Purdue is that we now have access to real thought leaders in some of the disciplines that we're very excited to be able to participate in. For example our board of trustees just approved for us to offer a program in cloud computing. And, we are going to be working with some folks from Purdue Polytechnic to make sure that the cloud computing [program] is at the leading edge of cloud computing technology.

With the skills in STEM on the Purdue campus at West Lafayette we really have an opportunity to bring that learning and that forward thinking to all of our students at Purdue Global as well.

Another example is we now have one one alumni association. And what that does is it gives our students the opportunity to connect and interact with Purdue University graduates and alumni. It also gives Purdue alumni the opportunity to interact with our students and with our institution in ways that weren't possible before. And I believe that's to the benefit of both institutions because of course more connections with more people is going to strengthen their careers and their lives in society.

I'm curious what attracted you to a for-profit university and particularly Kaplan in your career? You could have gone to other places and you worked in others before that?

I spent 15 years in traditional education. I was a tenured faculty member, I was an associate dean at Case Western Reserve University—a very, very good university with excellent students, and I had a terrific experience there. But when Kaplan came calling, I realized that what Kaplan was doing was something else. It was helping our society increase the education of people who are underserved. The adults who started university when they were perhaps the same age as we started university at but didn't finish, the adults that didn't have an opportunity to finish university, and adults who had lots and lots of really strong experiences, but they hadn't had credit for them. And the opportunity to help those people make that change in their lives was just what I was meant to do.

The other reason that I joined Kaplan University is I'm very, and continue to be, very excited by how quickly we can make things better. We come up with an idea, and we can implement it really, really quickly so we can move our institution forward, much more quickly than most traditional universities do. Early in my career I was a management consultant, and so I have sort of a bent for action. And Kaplan University really gave me the ability to make things happen.

You’re unusual for having worked extensively in both for-profit and nonprofit colleges. So you may not be surprised that many faculty at Purdue have raised concerns about the deal to purchase Kaplan University and to create this Purdue University Global. Some have signed petitions laying out their concerns. What is your basic response to these criticisms?

My initial response is, well, of course they're going to be concerned, and they should be concerned because it's their institution and it's the integrity of their institution that some would say is up for grabs. If I had been a faculty member at Purdue University and had only read the press about for-profit universities, I don't know if I would've ended up in the same place. But it's very understandable because there has been a lot of negative press about the for-profit world, and not all for-profit universities are the same, just as not all nonprofit universities are the same.

It has taken time, and we'll continue to work on this, although most of the concerns have dissipated. But they had to get to know us, they had to get to know what we stand for and how we manage quality in our classrooms, how we maintain the integrity of our academic standards. And as we have come to know each other, we've come to grow and appreciate both the similarities and the differences between our respective campuses.

It's something that learning about each other will bring us both to stronger places. There are many things that Purdue does very well, and there are some things that we do that Purdue can learn from.

Purdue leaders have said they want to learn from the online workings and what Kaplan has done. Are there any concrete plans yet, or could give any examples of what might be specifics of ways the Purdue Global might interact with the physical Purdue campuses?

It's very early. We're working with distance education at the Purdue campuses and describing to them how we put curriculum together, how we think about assessment, how we help support our students through their journey. But for me to point to something and say "And in the past 90 days, here's what we've already accomplished." That's a little bit premature.

It'll be interesting to see where those conversations take you. Can you give one example of something the way Purdue University Global does things that may be a little different than any traditional university would?

We have a different approach than most institutions in how we create our curriculum and how that gets moved into the classroom. We have a system where the faculty create the curriculum together, so all faculty who teach a particular course—let's say, introductory composition—work together under the leadership of one faculty member to evolve the content of that curriculum, and then they all teach the same curriculum. The beauty of that is that enables us to look at how well the curriculum is doing, how well our students are doing, how well our faculty are doing, and we can do research to evaluate different ways of approaching the teaching or the curriculum in a particular course.

That enables us to say "Well that doesn't work as well as this does." And then improve our courses as a consequence. We can do that because we have everybody doing things the same way. In a traditional institution, of course, faculty teach their own courses. Sometimes they collaborate on textbooks, but because there isn't one classroom that everybody agrees on, it's harder to test and improve, and that's something that we're bringing to Purdue. Our approach, we call it the Research Pipeline, we're bringing that approach to Purdue, and we expect that we will be able to take some of the innovations that the folks at Purdue have created, and test them to see if they work in a large scale.

A lot of traditional professors might object to that kind of standardization. But you're not saying that would come to the Purdue campuses?

No, no, no. I'm not saying that at all, what I'm saying is because we have standardized. There are real opportunities to test, and the consequences of those tests can then be brought back to Purdue. To say here's what we found with our students in our environment, and then Purdue faculty can learn from that and decide whether or not to incorporate those into their classes.

Do you think Purdue faculty might be teaching in Purdue Global, and vice versa?

You know, it's always something that's a little bit complicated because of employment rules and so on and so forth. We are really clear about what we expect of our faculty, we hire faculty based on their credentials, their experience in the classroom, and also their empathy to our students. And I believe that there are many faculty at Purdue who might be interested in doing that on an ad hoc basis. So, yeah it's a possibility. Again, it's early days, and we'll evolve that as we move forward.

The arrangement between Kaplan and this new Purdue Global University can be confusing. Is there a simple way of explaining where those lines are?

Yes. I think so. The way that it works is that everything that's directly part of the university is now part of Purdue Global. So, that's everything to do with teaching and learning, that includes obviously the library, curriculum, faculty, our learning management system, everything we do to support our students in the classroom. Kaplan Higher Education, which is an arm of Kaplan, which is an arm of Graham Holdings, provides back-office support. So they run technology for us, they help us with facilities, they do marketing with us, they manage the initial admissions process, they provide student support, they have a 24-hour hotline, they manage all that stuff.

You referenced earlier challenges and problems in the for-profit university sector over the last several years. Could you talk about what it is about Kaplan that is different?

There are 157 things, but the two main things I believe are the long-term orientation. We are not here to make, or we weren't, to make the next quarter's numbers, we are here to teach students. A strong, strong example is that students can come to school for three weeks—no questions asked, no money changes hands—to be sure that Kaplan University and now Purdue Global is right for them. We don't want students to have to invest in something that they don't know is going to work with their lives, and with what's going on with them personally. We have not taken millions of dollars in revenue to ensure that students come to school fully aware of what it takes, how much time they're going to have to spend.

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