Six Easy Steps to
School Productivity

Here are six technically simple (though politically controversial) reforms that the states could implement right now.


Over the past few decades, the American economy has made remarkable productivity gains that have fueled GDP growth and raised living standards. Unfortunately, the American public-education system has been moving in the opposite direction: Schools spend ever-larger sums of money per pupil, yet they are plagued by stagnant student achievement, declining output per teacher, and massive unfunded pension liabilities.

The chief obstacle to greater productivity in the education sector is a stubborn adherence to antiquated operational procedures that were designed for a past era. Attempts at genuine innovation are blunted by the absence of a profit motive, the existence of a virtual market monopoly, and inadequate accountability mechanisms. These factors are now blocking an urgently needed administrative overhaul.

While the status quo often seems impervious to change, here are six technically simple (though politically controversial) management reforms that could dramatically increase education productivity. (I’ve listed them in order of their estimated impact, from greatest to smallest.)

1. Empower principals as school CEOs. The typical public-school principal enjoys only a modicum of prestige and even less power. Unless principals can readily access data on student performance, select and evaluate their own teachers, exercise influence over teachers’ salaries, and make teacher assignments, they will be hamstrung as managers. Their relative lack of power makes it unfair to hold them accountable for the dismal performance of so many American schools. Moreover, the absence of real managerial authority detracts from the prestige of their position and discourages talented individuals from entering the leadership field.

2. Measure academic progress through “value added” testing. In order to guide school instruction and reinforce accountability, each student must be appropriately tested. The key word there is “appropriately.” Academic achievement should be measured annually against a baseline of conventional expectations. In other words, we should attempt to calculate how much value a given teacher and school have added. This idea causes plenty of handwringing in professional education circles. Yet value-added testing would give us a better sense of the contribution made by individual instructors and institutions. By measuring each student’s progress from one year to the next, we would no longer be unfairly penalizing teachers and schools that work with the neediest students or unfairly rewarding those that work with the most advantaged students. Teacher performance would become relatively easier to calibrate.

3. Reward effective teachers, and fire ineffective ones. This dictum is reinforced by both common sense and empirical research. Economists have demonstrated that effective teachers play a significant role in boosting student achievement, while ineffective teachers impose a substantial drag on achievement. It is critically important to reward the best teachers and replace the bottom 10 percent.

4. Distribute money based on student characteristics. States allocate money to districts based on numbers and characteristics of students. Districts should follow suit when distributing funds to their individual schools, but they do not. Instead, the superintendent’s office makes decisions formulaically, which means that schools have very little control over personnel assignments, teachers’ salaries, and non-personnel budgets. This weakens principals, dilutes accountability, and often leads to a misallocation of resources intended to help low-income children. If school principals were authorized to purchase the services provided by their districts, inefficient central-office programs and personnel would quickly be eliminated.

5. Designate the classroom as the fundamental financial accounting unit. How much is spent annually on reading or mathematics instruction? What specific achievement gains does this spending produce? Virtually no school district in America can answer such simple questions. Wal-Mart store managers know more about their daily profits than principals know about their students’ performance. States could easily alter their accounting regulations to determine the amount of money spent per classroom or course. Districts that already undertake such analyses have uncovered startling imbalances.

6. Rank schools and classrooms by both student achievement and productivity. The 2002 No Child Left Behind Act pioneered widespread appraisals of schools based on student performance. New data systems now allow us to expand this metric by combining pupil performance with per-pupil spending. Thus, we can establish not only which schools generate high levels of achievement, but which schools provide the most bang for the buck. Productivity begins at the smallest organizational unit. Detailed classroom-level information will enable principals to identify the personnel and practices that yield efficient achievement gains.

Each of the reforms outlined above is within the purview of state officials, and each can be implemented right away. These changes do not require daunting scientific breakthroughs. They simply require vision and political will.

— James W. Guthrie is a senior fellow and director of education-policy studies at the George W. Bush Institute in Dallas, and a professor of education at Southern Methodist University.



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