“This Is Are Story” – the Value of Quality Education and Competition

We are quite keen on quality education at Spend Matters – reference our enthusiasm for the “30 under 30” award to recognize rising procurement talent. It is after all an evergreen topic (worldwide in my experience) to lament the lack of talented and motivated resources available to backfill procurement positions. Inside tip: after the casual question of “So, how is that change management and solution adoption process going?”, the runner-up conversation starter has got to be “Any difficulties hiring and retaining skilled staff?” Those never fail to stir up a discussion, anywhere, with any company.

So, once we step outside the winner’s circle of recipients of ISM’s Richter Scholarship for Undergraduate Students, where do we find future talent? Well, not among the graduates from the Paul Robeson High School in Chicago, at least not judging by their recent senior prom sign:

Photo: Chuck Goudie

Photo: Chuck Goudie

The Paul Robeson High School is located in the Englewood neighborhood on Chicago’s notorious South Side, probably one of the worst neighborhoods in the country and certainly in the Chicago area. This high school is of course part of the dysfunctional Chicago Public Schools (CPS) system. How bad is it? Well, four out of 10 freshmen don’t graduate. Among those that do graduate and then go on to college, over 90 percent have to take remedial courses since they are not up to basic math and general school work. According to ACT subject matter exams, a mere quarter of the students at Paul Robeson High School can be called college-ready. Very sad, no matter how you look at it.

Before anyone starts to clamor for more resources, note that the average CPS teacher is paid a solid $76,000 per year. And in the most recent teachers’ union deal, teachers received a salary hike of 17 percent over the next three years. That’s over 5 percent per year, well over inflation. Consider that the typical Chicago household earnings are around $47,000 per year and in Englewood the typical household earnings are only half as much. In other words, the dismal failure is not because of insufficient teacher compensation. So, what is it?

Before I make suggestions there, when reading about this school failure, I was reminded of how great it is to be able to vote with your feet. In my own case, I have two young daughters (7 and 12). The younger one goes to a Montessori school, and the older one to a parochial school in the area. Our 12-year-old started out at the same Montessori school, but when she turned eight we thought she needed more structure and so put her in a local Catholic school. The school was great, but inept at business. They were so adamant about keeping tuition low that they bankrupted themselves. So after two years there we switched her to an Episcopalian school in the area – but they turned out to be hopelessly loosey goosey, so after a year there we switched her to the current school (a Southern Baptist school), which isn’t as good academically as the Catholic school was, but far better than her previous school. Lesson here is that it is great to be able to change schools.

In Sweden, where I grew up, the government has taken over all schools. There might be two or so boarding schools left that can be called privately run, but that’s it. The only “alternatives” are charter schools, which effectively amount to outsourced government schools – same car, different badge. No choice, no options, which is similar to what people on the South Side of Chicago face. Convergence to the mean, or mediocrity, is the best that can be expected out of this kind of system.

It’s amazing really, this utter lack of faith in any kind of innovation or progress in the field of education – and definitely no faith in competition. What function does the Teachers’ Guild, I mean teachers’ unions, play in the 21st century? Aren’t teachers managed by other teachers – who are abusing them? And what’s so magical about a teaching degree? Why do we intentionally limit the pool of potential teachers? Unions don’t like competition? Oh, wait, I see…

My mother is a retired teacher who eventually worked as a principal, and she laughs at the notion that a teaching degree should be a requirement. She certainly saw lots of people with teaching degrees who couldn’t teach. All of us in corporate life must have come across a few great teachers – although we call them trainers, consultants, customer support, helpdesk, etc. Probably no teaching degrees among them.

What would our ERP systems look like without relentless pressure from the SaaS providers? What kinds of cars would we have without competition? What kind of healthcare would we have without competition? Wait, we’re actually about to find out regarding the last one – and it won’t be good. About education though, the whole focus on standardized tests, core curriculum, and class size only becomes an issue when you have no choice – then all of a sudden you get management by committee and political supervision of something which would easily be sorted out by a competitive marketplace.

By the way, where I live, around 70 percent of county taxes are consumed by local schools! Crazy. The taxes spent per public school student is higher than in the private schools where my children go – as the situation is nationwide – so the resources are there to implement effective voucher programs. Time to let Adam Smith into the class room!

As an analogy, the difference between government schools and privately run institutions is probably similar to the difference (both quality and quantity) that I saw between GM engine plants in the Detroit area and Toyota’s engine plants in Japan (including Yamaha, their tier 1 engine builder). I was practically stunned when I first saw the GM plant – nice, clean, quiet, yes, but painfully low output and overloaded with ‘workers’ sitting on their butts. The difference is that the automotive world has improved since then (GM failed – or should have been allowed to) whereas public schools have gotten even more sclerotic. Actually private schools are being dragged down with them – same recruiting pool, federal funds with strings, never-ending mandates, and so forth that undermine any real progress. They’re still better, but sadly more and more of the value with private schools comes a) from being able to select a better group of parents and b) avoid the abject failure students that disrupt classrooms in public schools. It only takes one bad apple to spoil the bunch.

With vouchers in hand, the Paul Robeson High School students could escape the educational quagmire they are stuck in and get a far better education. Wouldn’t that be a nice change? I don’t expect to see it in my lifetime though – at least not in Chicago.

Something that I do expect and hope to see for those that make it to college – simply because student loan financials are making it painfully obvious – is a transition away from soft programs to hard STEM (Science, Technical, Engineering, Math) educations. Especially a shift away from these rather useless majors: anthropology, fine arts, philosophy, religious studies, graphic design, studio arts, liberal arts, drama and theater, sociology, and English. Especially the last one – why would you major in your native language? Books are easy to read on your own – for college, pick a subject worthier of going deep in debt over.

To clarify, the above subjects aren't useless, it's majoring in them that is. Actually it is frivolous luxury consumption to major in those subjects – those are the kinds of subjects that in the Old World (probably all the way back to the Romans and the Greek and so on) were intended to civilize the children of the lord of the manor.  For those without a gilded manor (aka trust fund these days) to return to... well, suffer the debt burden consequences! Better to go for a less glamorous STEM degree.  The fluffy & fun stuff is easy to pick up on your own - no need to go into debt over that.

Moving away from Old Albion and looping back to procurement – since you will have to contend with people from the equivalent of schools like Paul Robeson High for years to come, you’d better have a training program in place!

Invest in a relationship with organizations like ISM and their training programs, and work with your HR department to ensure that employees get reimbursed for passing exams.

Additionally, and this is something we hear from the C-suite on a regular basis, procurement needs to become more of a selling organization (internally as well as to suppliers) so we would advise you to also invest in the types of classes (Miller Heiman, for example) that your sales force goes through. According to heads of procurement that we’ve spoken with, strong sales ability (communications really) are probably the #1 skill gap among procurement professionals.

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Voices (4)

  1. Thomas Kase:


    You make my case for me, thanks.

    First of all, I think his quote should be seen as a metaphor rather than as a playbook for his offspring.

    Read that way, it becomes clear that Adams understood that the foundation (for a successful nation) is one of hard sciences which in turn is built on politics and sufficient military presence. Only with that underpinning can one engage in frivolities like painting and poetry etc.

    Even if you choose to take it literally, bear in mind that President Adams came from a fairly humble farming background (AFAIK) and only later gained fame, so he was probably keenly aware of the prevailing attitude among the landed gentry. (Which still persists, particularly and oddly among those with no country estates.)


  2. Richard Moore:

    I must study politics and war, that our sons may have liberty to study mathematics and philosophy. Our sons ought to study mathematics and philosophy, geography, natural history and naval architecture, navigation, commerce and agriculture in order to give their children a right to study painting, poetry, music, architecture, statuary, tapestry and porcelain.”

    ― John Adams, Letters of John Adams, Addressed to His Wife

  3. Thomas Kase:


    Allegedly it is “possible” to switch schools within CPS, but if you look at the rules for this, the chances are slim, and often tied to a lottery approach. Nothing like what the power of a voucher would offer!

    If Robeson has to compete – why wouldn’t it get better? No competition clearly isn’t working.

    I don’t follow the “4 schools” comment? If you are suggesting that some students might be beyond hope, sure, that’s probably true, but I doubt that they will be the ones looking for better academics.

    I don’t think there is much competition in US healthcare – in fact I can think of few verticals where consumers are as blind in their decision making process as in healthcare. Actual, informed competition is needed, and a lot less regulation.

    Japanese manufacturing? Do what? (as the expression goes here in the South) Where did that come from?

  4. b&t:

    Provocative as ever but…
    – if its already possible to switch schools, why isnt Robeson empty?
    – if Robeson has to compete for vouchers, wont it get even worse?
    – do you think that after 4 schools the problem might be you?
    – doesnt the us healthcare system expose the limitations of competition?
    -as does the success of japanese manufacturing.

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