Online Education: More Cost Efficient?

I can’t seem to put down the topic of online education. It’s growing by leaps and bounds, but public perception (and even the opinions of those in education) is mixed.

In an earlier post I discussed an online education study conducted by Ithaka S+R. I talked about the results surrounding specific learning outcomes and the attitudes of the students towards online learning vs. traditional education.

While these findings were very interesting and thought provoking, I find myself going back to another point that was made in the study that I felt compelled to address—the cost benefits of online courses.

The study discusses how online learning can help to alleviate the cost challenges that many higher education institutions are faced with due to tighter funding restrictions and reduced budgets. These restrictions remain a hurdle for both schools and students in their effort to obtain/provide higher education.

Organizational Costs

In other sectors of our economy, technology has helped to improve productivity, which ultimately translates into time and money savings over time. Can the same logic be applied to higher education institutions?

The research sought to answer the question, “under what assumptions will cost savings be realized, over time, by shifting to a hybrid format, and how large are those savings likely to be?” Their approach was to compare and contrast the costs of a traditional course versus a hybrid-format course by accounting for instructor compensation, the cost of the physical space, and more.

In the study they found that the investment required to establish an online learning program can be substantial. More intelligent IT systems are required and the staff needs to train the instructors on the technology. But overall, due to compensation costs, the hybrid-format proves to be more cost efficient.

The hybrid-format offers schools several benefits, including:

  1. Serve more students
  2. Promote greater flexibility
  3. Reduced fixed costs
  4. Recruit nationally for talent

Student Costs

In addition, the peripheral costs for students are decreased. Students don’t need to move onto or near a campus. They don’t need to commute, and online courses offer flexibility to working students. The convenience factors alone often translate to a tremendous cost-savings for students.

With all of the evidence pointing to online learning being a less expensive option for both schools and students, I expect this trend towards online education to continue.

Does your school offer distance ed or hybrid programs? If so, how do the costs compare to your brick and mortar operations?

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