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Technology
Costing Methodology: Expanding
the NCHEMS "Cost Finding Principles" for Cost Control
Using Technology. Colleges,
universities, states, federal agencies, and private foundations
are making large investments in instructional technologies
on the assumption that technology will somehow lead to improvements
in educational quality and an eventual reduction in costs
through greater efficiency. Unfortunately, the ability
of instructional technology to reduce costs in higher education
is unknown. It requires the ability to compare costs across
institutions or within an institution, however, no single
institution can run enough "experiments" to understand
efficiencies in a broad sense. Therefore, costing methodologies
derived from a single institution’s record-keeping system
will not suffice. What is needed is an approach that can work
across institutional boundaries and be accepted by educators
across the institutional spectrum. This will provide
an objective basis for understanding the scale effects of
different modes of delivery.
Current costing formulae suffer
from several drawbacks: they cannot be generalized beyond
a campus or set of institutions; they require a level of
detail and specificity that is not easily adapted; or they
view technology implementation in isolation from the remainder
of the campus. A methodology is needed which would
include procedures that:
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appropriately treat capital
costs for both regular classroom and mediated instruction;
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treat the developmental costs
(or acquisition costs) of courseware in an appropriate
fashion;
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distinguish between institutional
costs and student costs in a conceptually sound way-cost
"shifting" results in cost "containment"
to only one of the parties; and
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define the full range of
cost categories related to technological implementations,
to overcome the proliferation of "hidden costs."
It is a very real danger that
current investments in technology are based on unrealistic
expectations, and that the true effects of technology investments
will be unrecognized even when they occur. What are the
cost implications of these investments? In most cases, nobody
knows.
Participating as a project partner,
the National Center for
Higher Education Management Systems (NCHEMS) will use
the technical expertise of the Western Cooperative to develop
the Technology Costing Methodology. This methodology
will be based upon the widely accepted 1974 NCHEMS’
"Cost Finding Principles". By basing this
model on well established principles, most institutions
will need adapt only the additional methodology and not
need to rework their accounting systems.
The goal of this project is to develop an authoritative
costing methodology (and related procedures) for calculating
costs:
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within an institution to
determine if proposed instructional approaches, that
make heavy use of technology, actually do serve to contain
costs; and
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across institutions allowing
data to be compared legitimately for different instructional
or technological approaches, which will benefit legislatures,
state-governing boards, state coordinating boards, and
federal agencies.
This methodology will include
data definitions and accounting conventions. It also will
be reviewed by both higher education costing experts, and
field-tested at four institutions in, at least, two states.
Dissemination of project results will be provided through
publications and national meetings.
Updated
04/03/2002
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