A post-Leveson, ‘role of the media’ speech I helped write for Lord Puttnam. 759,000 views on TED!
Here’s what I’ve been working on in 2014: A new chain of low cost private schools in Metro Manila.
Schools in England are getting bigger. Department for Education data shows that between 1997 and 2005 the number of schools in England with 1,000 to 1,500 students rose by 35%. Secondary schools with between 1,500 and 2,000 students rose by 124%. In contrast, the number of small secondary schools in England, with fewer than 500 students, fell by 43%.
The conventional arguments used to defend this increase in scale are misleading.
The primary argument is that large schools benefit from economies of scale. However, economies of scale in schools are rarely realised. The concept of diseconomies of scale has long been recognised in other sectors. It describes how many of the consequences of getting larger such as high communication and coordination costs, anonymity and extraneous auxiliary processes can undermine savings made elsewhere, such as in procurement. In schools a principle diseconomy cost is the need for large numbers of non-teaching support and admin
Even more important than cost is the tendency, as diseconomies begin to emerge, for large organisations to find that their size obstructs the delivery of the outcomes they are created to achieve. An argument for large schools based purely on cost fails to consider cost-effectiveness or value for money, i.e. it fails to consider whether schools are actually delivering for students and parents. This is why the second key argument in favour of large schools, that they are necessary in order to provide a broad curriculum, is particularly misleading. A broad curriculum is worthless if students are not succeeding in it, or are unable to access it. This is too often the case.
Large schools tend to adopt rigid, vertical, departmental structures. These structures do not enable or encourage a teacher in one subject to explicitly reinforce the skills a student has learnt in the others. They obstruct the development and implementation of effective remedial interventions and cross-curricular learning strategies. Students are often obliged to effectively start from scratch in each subject they study – with the result that at worst they do not progress, or at best it is difficult for them to gain a sense of overall academic progress or of how the components of their learning interrelate and reinforce one another. The argument for breadth is undermined because in fact many students are unable to develop the mastery of core skills and competencies that would allow them to access a broad curriculum. Whilst it is true that large schools do not have to adopt vertical departmental structures, scale and vertical structure have in practice become synonymous. Where large schools have created different, horizontal structures this is often referred to as creating schools-within-schools or small learning communities. These alternative structures attempt to replicate the benefits of small schools within larger ones. This is complex and there are few examples of success.
There are other arguments in favour of small schools.
Large schools suffer, to varying degrees but consistently, from an absence of accountability. In large schools there is little time for meaningful cross-departmental analysis of students’ progress. In a 2007 survey only 17% of Teach First teachers agreed with the statement “I know who my students’ other teachers are”. Whilst each teacher is responsible for a student’s learning in his or her particular subject area, no teacher is responsible for the student’s overall education. Form tutors and year teams, whose ‘horizontal’ responsibilities for students’ education could counterbalance this, because of the number of students they need to deal with, spend in practice far less time with their designated cohorts than with the students they teach in their subject departments.
Lack of accountability is compounded when teachers constantly interact with students they don’t know. For example as they move between classrooms or take cover lessons, when they are on lunch duty or supporting other members of staff. The way that staff and students are able to move around the school and the manner in which students and staff interact are vital components of a positive educational environment. Large schools, by definition, tend towards depersonalised interactions.
The critical factor is the number of individuals in a community who interact exclusively with one another. In large schools teachers’ time and energy are spread too thinly between too many students. When a small team of teachers are accountable for a small number of students it is possible to ensure that every student is known as an individual, making it harder for students to ‘fall below the radar’. It makes it easier to ensure data for all students, both academic grades and other data such as attendance, is always understood and analysed in context, and it makes response and intervention more rapid and more effective.
It is for these reasons that the Free School I hope to found with a group of mostly Teach First Ambassadors, The Reach Academy: Feltham, has been designed to be, and to remain, a small school with dedicated teams of teachers responsible and accountable for every aspect of students’ development.
We don’t just need more and better teachers; we need more and better school models.
It’s in vogue at the moment to say that the way to improve schools is to have better teachers. I don’t mean to be too dismissive by saying ‘in vogue’; it is more than just the latest, passing education trend. There is solid evidence to support the assertion that effective classroom teaching is the best tool for addressing the intractable problems of educational disadvantage and underachievement.
The danger, however, of such a focus on teachers and classroom practice is that we ignore the importance of school structure – we ignore those things that create the conditions in which classroom teaching occurs: the size of a school, its assessment practices and data tracking, the number and types of staff and their responsibilities, the methods for informing and engaging parents.
These elements of school structure, added to a particular pedagogy, constitute the school model and are the difference between the vision and delivery of education provided by, for example, your local comprehensive, a Steiner school, Eton or the KIPP network of US charter schools.
Different models can be equally successful and some models will work better in some contexts than others, but sustainably successful models will share characteristics. Effective school models don’t fail when inexperienced or temporary teachers enter. Nor do effective models rely on heroes: the exceptional teacher whose influence extends out of their classroom and into the corridors around creating an island of calm until a corner is turned and chaos resumes.
To a lesser or greater extent these symptoms are common in many of our schools today, and they indicate a failure of the model. Despite massive investment over the last ten years there has been little innovation in school models. It’s become almost a cliché to say that most of our schools are based on a nineteenth century factory model of how education should be delivered: large numbers of pupils moving from station to station, regulated by bells – education mass produced.
Surely the clearest indication of systemic failure, of failure on a large scale of the current school model, is that half of all 16 year-olds do not achieve at least a grade C in GCSE maths and English. (This CBI report presents some other interesting findings.)
Putting a teacher into a bad school model is hugely inefficient – it both dramatically increases the amount of time a new teacher takes to become effective, and actually caps the value that even a good teacher can add. Even if we could still afford the investment in education of the last decade, throwing more teachers into bad schools would be hugely wasteful. We need new models.
Two types of system redesign are needed.
1. We need new school models that work in the twenty-first century. These models are likely to rethink how cohorts of pupils are organised and how staff are held accountable for them. They’re likely to make far better use of real-time assessment data and to better connect parents with their children’s education. Maybe these models will go further, breaking long held assumptions about how education should be delivered, like Dennis Littky’s Big Picture schools, Ted Sizer’s Coalition of Essential Schools or the pioneering New York City-As-School.
2. We need to create an environment in which new models are able to emerge. This point is worth making again: despite massive investment in education, despite an intervening explosion in internet technology, despite entering a new century in which the experience of adulthood is dramatically different to the last school models remain largely the same as they were not just ten years ago, but probably 50 years ago.
This is why many of the Coalition’s education reforms are sensible. The supply side revolution, making it easier to establish a new school, is about creating the conditions for new models to emerge.
But the Coalition could go one step further to ensure that the best possible models are amongst those that are launched.
To find the best models let the best providers into the system.
At the moment businesses cannot directly run Free Schools. Instead they’re required to add a layer of cost and bureaucracy by establishing charitable vehicles that then contract school services. This seems absurd. Why is there a hang-up about profit making in education? One intellectually pure argument is to denounce capitalism and the profit motive, but even most on the political left don’t share that view. We currently allow schools to buy all manner of services from profit making businesses even down to the management and running of a school, yet companies are prohibited from operating schools directly.
Enabling private companies to run schools directly brings two things to British education. The first is a proliferation of new school models developed using principles and processes more often found in businesses than schools: a sharper focus on collecting and acting on real time data, for example, or a better alignment of organisational structure with outcomes.
The second is investment and the better allocation of resources. In these financially constrained times, business has the means to fund capital investment. Capital investment in education means new, purpose built schools. Business also understands economies of scale. Crucially the private sector is better placed to understand the difference between the economies of scale that could be achieved by a network of schools sharing well-managed back-room functions such as HR and data management, and the diseconomies of scale that are rife in the current model which is for schools to be large and stand-alone.
Our education system as a whole needs to be more dynamic, characterised by more innovation more often. We need to find the models that will work for the kids that are currently being failed. To achieve this we need to allow the best education providers to enter the field. Any increase in supply may mean that bad schools will close, but the spectre of turmoil that critics present if businesses were to enter the education sector is misplaced. With brands to protect and having signed contracts whose pay-out depends on their long-term delivery, it is a mistake to assume that education businesses do not value stability. And exactly what is the value of stability in a stagnating system that shores up, but does not fix, failing schools? Moreover, the closer we can move to a real-time per-pupil funding method the less disruptive it will be to allow failing schools to close.
What we’re not talking about is some kind of unregulated free for all. There are legitimate fears about the role of business in education and they can be assuaged by creating an appropriate regulatory framework. It is important that government, at local or national level, undertakes effective commissioning, requiring new schools to adhere to the Admissions Code and to be inspected by Ofsted, for example, or even going further and ensuring that schools run for profit adhere to a national curriculum, or minimum pay requirements for teachers.
More radically, the government could set bold strategic objectives for for-profit Free Schools, setting contractual requirements that they narrow the achievement gap of disadvantaged pupils in their care. Market mechanisms like the pupil premium provide an incentive to serve poor communities, but there’s no reason why in addition this couldn’t be explicitly stipulated in an agreement with an education provider. It seems that the critics of for-profit schools lack faith in the ability of government to set strategic objectives, to commission and to hold to account.
Arguing that businesses should be allowed to run schools need not be an anti-state, small government argument. I believe in a strong state that intervenes to look after the most vulnerable. My favourite West Wing speech is this one:
“Education is the silver bullet. Education is everything. We don’t need little changes. We need gigantic, monumental changes. Schools should be palaces. The competition for the best teachers should be fierce. They should be making six-figure salaries. Schools should be incredibly expensive for government and absolutely free of charge for its citizens, just like national defense.”
And my second favourite is this:
“We have to say what we feel, that government no matter what it’s failures in the past, and in times to come for that matter…can be a place where people come together and where no one gets left behind…An instrument of good.”
I’m not arguing for the private sector to be involved in education in order to minimise the role of government, or from some free market ideology, but because I think it has the potential to implement new models that are more effective – that can better implement progressive policy objectives. We will need to regulate for-profit education providers, and tax them, and we may want to first run pilots in some of the most deprived parts of the country, but I see no reason why we should prohibit a company from investing in British education on the basis that they may make a profit.
My copy of Nicholas Taleb’s The Black Swan, a book about risk and uncertainty, was almost destroyed by a freak hurricane (at least it was freaky for a Brit who had then just arrived in the US). Almost, but not destroyed: I was able to use it to write my last post which concluded with Taleb’s advice that instead of investing in trying to predict the problems we may face in the future, we should invest in preparedness.
Don’t pack a raincoat
Being prepared in a very uncertain world is more about being adaptable than it is about being prepared – at least in the sense of “being prepared” that your mum implies when she says, “It might rain today so take a raincoat”. When you’re thinking about the weather the world is quite uncertain. You may not be sure if it’s going to rain or stay dry, but you can fit the kit you might need for either scenario in one rucksack. In a very uncertain world, no rucksack is big enough. If we lived in a world where the range of climatic possibilities could include the ten plagues, purple rain, asteroids, or something altogether inconceivable, you could never pack for every eventuality.
The world we live in today is more than ever very uncertain. In such a world, making predictions is almost impossible and being fully prepared is very difficult. What is possible is to prepare to be adaptable.
Do adopt characteristics of smallness
One survival strategy is to be adaptable by staying small. For businesses, if you can be small and keep costs low you may be able to adapt to disrupting shocks that destroy other less nimble competitors. If you’d been a tiny team of entrepreneurial journalists publishing a niche magazine in the nineties you might have found it easier to move your business online than had you been a multi-title conglomerate with a printing press and a fleet of delivery trucks.
Writing about education, Max Haimendorf and I said that schools need to be smaller, but that being small is not enough. They also need to adopt a series of behaviours and structural changes to give them (in a phrase that I’d like to say we coined) the characteristics of smallness. (For a pretty encouraging evaluation of New York City’s small schools see this paper, which similarly talks of smallness as an enabler of other positive traits.)
I wanted schools to cut out all the peripheral and ruthlessly prioritise outputs (and, in truth, only the final outputs that count: those national exams and, ultimately, getting kids to university); to reorganise teachers around achieving those outputs for a defined cohort of pupils; to eliminate subject silos and many auxiliary roles, forcing all staff to be expert teachers and not administrators or even necessarily subject specialists. I wanted teachers to work exclusively with one cohort of pupils, and within each cohort for every pupil (and every parent) to have one principal teacher, in order to make accountability unavoidable. Instead of being collected infrequently in end-of-term exams, (formative) assessment data would be collected every week at a minimum.
I think there may be some principles in these characteristics that apply to organisations generally, not just to schools. My version of our vision to remedy education was of schools as lean start-ups: small (“human scale”) teams of teachers taking absolute responsibility for achieving an outcome they’ve defined with a simple set of metrics.
Not characteristics of bigness
The characteristics of smallness were, for me, a response to the crippling diseconomies of scale I’d observed in schools (diseconomies that I’d argue far outweigh any positive economies of scale). Big in itself is not bad, but some of the characteristics of bigness are.
One characteristic of bigness is the tendency in the face of complexity to attempt to break down your organisation into ever smaller functional roles. Like many bad strategies this is a strategy that maybe won the last war (or the one before that) but is unlikely to win the next. Obsessive specialisation within your own processes worked for Henry Ford, but I’m not sure it’s right for most organisations today. In business there are scenarios in which requiring your employees to do only one thing very well may be sensible, but it is often the response of a company that is struggling to eke out efficiency in the context of falling margins or a product that is becoming commoditized. If what your people can do is restricted to a very narrow set of tasks, it leaves your organisation vulnerable to unexpected events that change the game and so require something else of them. In some cases businesses are feeling the effects of an approaching, disrupting storm but are betting that they can predict the nature of it instead of preparing for the adaptability that will be required once it has hit (indeed they may be investing in the very things that will make it harder to recover). In Taleb’s extremely uncertain world the characteristics of bigness are especially damaging because they undermine adaptability.
There are other characteristics of bigness (high communication and cooperation costs, anonymity, extraneous auxiliary processes…), some of which can be ameliorated by technology, some of which can’t. I think, though, that if an organisation is going to succeed in this increasingly (exponentially?) uncertain world, it needs to think about how to prepare to be adaptable, and that one way to do this is to adopt characteristics of smallness.
Max and I wanted small schools to adopt the characteristics of smallness because we’d observed what happens when big schools adopt the characteristics of bigness. It’s also possible for small organisations to (disastrously and mistakenly) act like big ones. (One clue that a company may be doing this is when it finds itself investing in the blunt machinery of organisation, like hierarchical structures and formal reporting lines.) But, the exciting (and maybe the obvious) question is, can big organisations act like small ones? Can big organisations adopt the characteristics, but not the actual smallness? Could you – by building highly aligned loosely coupled teams networked together – scale the characteristics of smallness while avoiding some of the worst effects of the characteristics of bigness? The guys at Netflix, who wrote my all time favourite PowerPoint, seem to think so.
What do you think?
I started reading Nicholas Taleb’s The Black Swan in May last year. I took it to the Delfest music festival where we’d been promised bluegrass and sunshine. A hurricane tore down the camp and flooded the fields. The book sank in the swamp, was bravely rescued, and has since dried out. I started reading it again the other day.
Taleb’s central thesis is that we are much worse at predicting events than we think we are. In fact we massively overestimate our capacity for prediction.
Imagine a thousand people in a stadium. If we measured what percentage of the total the heaviest person weighs it would be a tiny percentage, right? Now imagine this time measuring not weight but net worth. The richest person could be a massive percentage of the total. In the first scenario, a rare event – a very very fat person – is nevertheless tiny in relation to the total. In the second scenario, a rare event – a very very rich person – can be huge in relation to the total.
This has implications for our ability to make predictions. Say you didn’t want to weigh every one of the thousand people but you did want to know their average weight. You could start weighing people and stop when you’d done one hundred and you’d be able to make a pretty safe prediction about the average. Even if person 101, or 999, was exceptionally fat your guess wouldn’t be out by much. But if you wanted to know the average net worth you’d be a fool to stop at person 100, because somewhere amongst the other 900 Bill Gates might be lurking.
Mediocristan vs. Extremistan
Scenario one belongs to a world that Taleb describes as Mediocristan. Number sets in Mediocristan fall on a bell curve and they include things like weight and height or the income of a baker or a small restaurant owner. In Mediocristan things are non-scalable; however hard the baker works the difference between the number of buns he makes on a great day versus a bad day will not be dramatic. One option if he was dissatisfied with that state of affairs would be to create a franchise of his bakery. And here we enter the territory of the second scenario that Taleb calls Extremistan. In Extremistan things are scalable. Extremistan includes things like wealth, book sales or academic citations. The baker – living in Mediocristan – will make about the same number of buns every day for about the same level of effort. A musician, by contrast, lives in Extremistan. He could churn out record after record that nobody listens to and, without a corresponding increase in the effort he expends, one day he could make a hit record that sells ten million copies.
More of the world can be described using the Extremistan label than the Mediocristan label. Almost all social matters, or anything that is informational as opposed to physical, can be described as scalable and so as belonging to Extremistan. Not only is the list of things that we can categorize as belonging to Extremistan longer than the Mediocristan list, but today it is longer than it has ever been. Technology is of course key to this. When we are more connected we can generate more accentuated winner-takes-all effects. The less we are constrained by the physical the more we can scale. Once upon a time musicians weren’t scalable, they had to be in the same room as their audience. Once upon a time bookstores were limited by how many books they could keep on their shelves.
A more uncertain world
Today we are far more likely to encounter scenarios like the net worth calculation than the weight calculation (because today we live in Extremistan). The world is more uncertain and more prone to game changing events than we like to think.
“Measures of uncertainty that are based on the bell curve simply disregard the possibility, and the impact, of sharp jumps of discontinuities and are, therefore, inapplicable in Extremistan. Using them is like focusing on the grass and missing out on the (gigantic) trees. Although large deviations are rare, they cannot be dismissed as outliers because, cumulatively, their impact is so dramatic.”
In a previous post I touched on some of these ideas. I said, pretentiously, that we live in Exponential Times. I’m attracted to the idea that we live in a world of rapid rises and steep declines: a Long Tail world where, yes, blockbusters still happen, but where the ability of an organization, institution, business or politician to take for granted their position at the top is seriously undermined by uncertainty – by the possibility for churn at the head of that long tail. It’s more possible than it has been in the past for rivals to spring from nowhere and steal your crown. Or, more excitingly, to disrupt your entire market by destroying long held assumptions.
Taleb’s advice is that instead of investing in trying to predict the next problem we should invest in preparedness.
Which I think is going to be the topic of my next post. Any thoughts?
1. A plummeting Coasean floor means we can do more things outside of traditional organizations like businesses.
Here’s a question that I try not to ask in earshot of my bosses. Instead of employing me on a salary, why don’t my firm put out a tender for every piece of work I deliver? In an open market, with other people competing to perform broken down chunks of my job, my company could end up paying less. Reassuringly for me, Ronald Coase explained why in The Nature of the Firm in 1937. It is because of the additional transaction costs that my firm would incur – in particular of finding a contractor and enforcing a contract for every piece of work I currently undertake. We can describe these kinds of costs as the cost of cooperating. Companies exist in order to manage these cooperation costs. They do things like employ managers and pay for HR departments – and create, for the most part, hierarchical organizational structures – because, for the activities that they’re engaged in, this is a more effective way of directing a workforce than an open market. But of course this management has a cost, much of it fixed. Firms exist, therefore, when the costs of employing and directing staff to undertake a particular activity are less than the potential gain from that activity.
But what if those cooperation costs exceed the potential gain of an activity? Even if it is a valuable activity it won’t happen because the cost of performing it is greater than the gain. When neither firms nor markets can afford to undertake an activity, that activity doesn’t happen. The significance of this is that there’s a bunch of locked up value out there: stuff that would be great if it happened because it would improve our lives, but it’s just not cost effective to make it happen. Unless the conditions change. Coase goes on to say that if cooperation costs fall, for example when new technology makes communication easier, then some activities that were previously not worth doing become viable. In addition, big firms can get bigger and small firms can get more efficient. This has basically been the story of the impact of communication technology in the twentieth century.
Enter, Clay Shirky. He says in Here Comes Everybody that Coase’s explanation is limited to describing what happens when cooperation costs fall moderately. What happens if these costs collapse? What happens if revolutionary technologies come along – like the internet and the web and those related innovations that have exploded since – that dramatically reduce the cost of cooperating? If cooperation costs collapse then something new occurs. There are still activities that have value but can’t be undertaken by a firm because their value is not greater than that firm’s cooperation costs, but, crucially, some of these activities can be undertake outside of the structures of formal organizations. These activities ‘which were previously out of reach for any other organisational structure, because they lay under the Coasean floor’ can now be undertaken not by a firm (with their fixed cooperation costs) but by ‘loosely coordinated groups’. These groups do not have the same, and in some instances any, fixed cooperation costs. Shirky provides many examples of this, from the aggregating of amateur documentation of the London transit bombings to the collection and collation of thousands of photos of public events on Flickr.
As cooperation costs plummet this opens up the possibility for productive activity to occur outside of formal organizations. As Clay Shirky tells us, it enables organizing without organizations. I think this leads to more experimentation and faster innovation, throwing down a massive, existential, challenge to traditional forms of organization – including the familiar business models of the last century.
2. This doesn’t mean we’re in an egalitarian paradise. In these exponential times we still have big businesses that rise rapidly. But are they also more likely to decline rapidly?
This social, technological and economic shift means that it is easier than it has ever been to engage a large audience and undertake some kind of group effort; and it means that you don’t necessarily need the hierarchical structure of a firm to do it. This does not mean, however, that we have been immediately thrust into some kind of egalitarian paradise. We still have businesses, and we still have big businesses. How do we explain that?
It is the effect of the internet and the web on communication that has most radically lowered cooperation costs. One of the effects of the web has been the emergence of a link economy – one where you are more powerful if more people link to you. In this link economy Michael’s Matthew’s Law exists: “For everyone who has will be given more”, i.e. links beget links; the more you have the more you’ll get, the quicker you can grow and the more powerful you can become. (Check this post out and the further reading at the bottom of it.) This is the other side of the story of the Long Tail, as many have pointed out. Whilst the internet has enabled millions of tiny niche interests to be fulfilled and niche markets to be created, there remain major blockbusting companies, products and services. Although, of course, not just products and services created by companies; loosely coordinated groups can emerge from below the Coasean floor to generate huge value and to challenge traditional organizations. The point is that once you start growing you can grow quickly in the internet age. In these exponential times that much is evident.
The question for anyone looking for an egalitarian, or at least meritocratic, paradise is how much churn are we expecting to see over time in the head of this Long Tail? Are we simply solidifying a small, new-ish, comparably static elite as has been the norm in politics and economics throughout most of history, or is the internet dramatically altering how secure those at the top should feel? Might it be the case that the internet facilitates meteoric rises and rapid declines?
In this last year in America the political fortunes of the Democratic party might seem to suggest so. Or rather, as I wrote in this blog post, because the communication tools of the internet are powerful and ubiquitous, and because it is so much easier to exercise an (informed) choice as a voter or a consumer, anybody seeking our loyalty cannot let up and take us for granted for even a moment. I hope it won’t end up being the permanent tactical revolution that Obama in his State of the Union decried, but I do think political parties need to adopt a philosophy of permanent strategic, or persuasive, revolution (I’m not sure of the phrase yet, I want to develop this idea). And the same is true of companies. Stop fighting for my custom for a second, get a bit sloppy with your delivery, and the massive information availability and tiny switching costs of the internet age mean I can leave you in an instant. Losing my custom to a competitor has a greater potential to snowball, pitching you into a steep decline, than ever before.