How Business Leaders Can Strengthen American Schools

The declining competitiveness of the United States in world markets is due in part to the country's stagnant education system. Yet partnerships between business and educators have been marked by distrust. Jan Rivkin highlights proposals for a new collaboration.
by Julia Hanna

Business has long recognized the connection between an effective school system and a qualified workforce—by some estimates, the private sector invests $4 billion annually in efforts intended to improve public education.

So why isn't that investment paying off?

"Business leaders today are engaged in education in ways that are generous, well-intended, effective at alleviating the symptoms of a weak education system, and thoroughly inadequate to help strengthen the system," says Harvard Business School Professor Jan W. Rivkin, a leader with University Professor Michael Porter of the School's U.S. Competitiveness Project. Rivkin is the Bruce V. Rauner Professor of Business Administration.

“Study after study has shown that a country's long-term prosperity depends on the quality of its human capital”

Rivkin and fellow HBS faculty Allen S. Grossman and Kevin W. Sharer have joined forces with the Bill and Melinda Gates Foundation and the Boston Consulting Group to determine how business leaders can partner more effectively with educators to support America's students and schools.

"Study after study has shown that a country's long-term prosperity depends on the quality of its human capital," says Rivkin. "So if we're really falling down in that arena, we have an economic problem so important that business leaders can't sit on the sidelines."

On the positive side, this could be a promising moment for American education. Rivkin points to developments such as improved teaching and leadership talent, the use of technology in personalized learning, the Common Core State Standards Initiative, wider school choice, and a dramatic upgrade in the quality and use of data analytics to determine what is working in education and what isn't.

So where do business leaders fit in? The group's recently published work identifies three areas that capitalize on business's strengths and result in the greatest returns:

  • Influencing policy. "We know that policy often stands in the way of innovation and education," says Rivkin. "Business leaders can wield a great deal of influence in policy—especially local policy—and local policy is where all the action is in education." In Denver, for example, business leaders partnered with educators to lobby for an increase in taxes to support education.

  • Building on proven innovation. "There's no shortage of success stories in particular schools and districts," Rivkin says. "The problem is that they tend to get bottled up in individual localities." Since business leaders are often adept at scaling up innovations that work, why not leverage that expertise? ExxonMobil, a founding sponsor of the National Math and Science Initiative, helped to scale two projects: one focusing on improved training for science, technology, and math teachers, the other on improving advanced placement test results in the same areas.

  • Reinventing the local education ecosystem. Many communities have programs to support children and education—but they're often not coordinated, resulting in gaps and redundancies in service. This a fertile area for collaboration. "What you see in some places are business, civic, and education leaders partnering to create a strategy to support kids from cradle to career," says Rivkin. In Cincinnati, the Strive Partnership serves as a central clearing house for aligning goals with the metrics and decisions to meet those goals. "This fosters a sense of collective responsibility but individual accountability," says Rivkin. As another example, the GE Foundation sponsors Developing Futures, a program that partners with seven school districts where GE has major operations to upgrade management talent and processes at the district level.

Obstacles To Overcome

So what's the likelihood that these sorts of partnerships will become more prevalent? The private sector's $4 billion per year investment in education is a drop in the bucket when you consider the $600 billion total spent annually on US K-12 education. But it is still a significant sum with high-impact potential. Unfortunately, no clear, aggregate data exist to indicate how that money is spent, or its effectiveness.

The U.S. Competitiveness Project and its partners surveyed business leaders and school superintendents to gain a clearer understanding of the two groups' interactions.

The picture that emerges is a mixed one. On the plus side, 95 percent of superintendents could point to some form of business engagement in their districts. But on closer examination, much of that engagement can be characterized as "checkbook philanthropy" in the form of donated money, goods, and scholarships.

"These are noble efforts that are effective in their own way," says Rivkin, "but they don't result in positive, lasting improvements to the system."

Superintendents are happy with this sort of interaction, the survey showed, and 80 percent would welcome more collaboration, with a majority indicating openness to new types of engagement.

The two groups had very different perceptions of the effectiveness of K-12 education, however: Business leaders characterized the system as "poor and deteriorating" compared to other advanced nations' while superintendents saw it as "strong and keeping pace."

Another potential barrier to productive partnership: Business leaders tend to give themselves more credit for being informed about education than superintendents do.

Rivkin notes that in the survey of superintendents, the qualitative comments section also showed a clear undercurrent of distrust and lack of respect. "The gist was that a business leader would come in and say, 'I know how to run my business so I know how to run your school.'" The attitude that superintendents desired of business leaders was quite different: "I'm going to learn first, you're the professionals when it comes to education," Rivkin summarizes. "I'll have my ideas, but we're going to do this together."

The group's ongoing efforts currently include several publications available for download at the U.S. Competitiveness Project's website, including Lasting Impact: A Business Leader's Playbook for Supporting America's Schools and Partial Credit: How America's School Superintendents See Business as a Partner.

"There are some good, evidence-based programs that business leaders can start getting behind," Rivkin says, "but there's no question that we need a better understanding of what actually works."

The partnership between business and education must be long term, he adds. "The problems that we've seen in the education system and in our approach to human capital have been a generation in the making, and it will take a generation to set them right. Most businesses have an approach to partnering with educators that made sense in the past but is not adequate for the needs or the opportunities of the future."

About the Author

Julia Hanna is Associate Editor of the HBS Alumni Bulletin.

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In order to be published, comments must be on-topic and civil in tone, with no name calling or personal attacks. Your comment may be edited for clarity and length.
    • N.R.Jothi Narayanan
    • Project HSE Consultant(chemical,gas &oil), Independent.
    The message is not clear. I would like to divide the contribution of business leaders to strengthen the schools in two different ways.
    1) strengthen the schools by monetary support.

    2) Strengthen the schools by generating more employment in the business of the business leaders.

    Off late ,I agree that there is something has gone wrong somewhere in the education system that is very transparent in declining standards of today's America in international issues.
    During my school days,(50years ago) at Holy Cross Convent in Tamil Nadu,India by seeing the distribution of milk to the poor thru' CARE (Cooperative for American Relief Everywhere)my impression on then America was a benign and country with a helping hand to the needy in the world.
    Today, America is the only existing super power but lives on fear and has lost the genuine friendship with his own allies.
    In the past, schools were able to create best students having the potential to become world leaders.
    In a country like America,as long as the government spend on education with the dedicated teaching faculty capable of infesting Human values plus curriculum, American education system will compete and inter act with the world.
    When the education system depends on business leaders for the survival, the students will be tailor made to the requirement of the respective sponsored business leaders where the Human value occupies the rear seat and the global interaction will be a remote operation.

    Still, I consider an Asian student who writes volume of essays in English without an aid and try to differentiate the unit of length as "Metre" and the measuring instrument is a "meter" by not using the same spelling for both like an American student, the former is building up the strong foundation at school.
    Where learning has become a business, automatically the basic human value disappear.
    Where the pedagogy stands for human value and impart knowledge the spirit of healthy competition and development will take place but in steadfast .

    N.R.Jothi Narayanan, Palakkad-678001-India.
    • Cam P
    • Parent
    Interesting article...$5 billion investment by industry...isn't paying off....maybe it is because with 64,000,000 students in primary and secondary schools....the investment is only $78.00 per child...about the same as a nice dinner out for 2. What if the U.S. treated education like the border crisis or Iraq war or other international crisis and allocated adequate resources required for educating in today's environment and overcoming today's hurdles (high poverty among children?). Maybe if we had that type of focus we could reach more children that need help sooner and provide quality pre-school for all children? If business leaders believe that our education system needs fixed, how about using their lobbying talents for additional resources that are proven to be successful like early childhood education and doing it on an emergency basis....not waiting for the next generation. We now spend $600 billion on education (primary and secondary
    ) mostly funded at the state and local level so why not up it by 20% at the federal level or $120 billion and fund pre-school at the same level as primary and secondary schools and maybe let industry provide for all technology upgrades maybe at $12.8 billion a year or $200 per student so that we increase access to technology to all students. --- of course all solutions seem simple...I am sure it is more complex than this......
    • Julia Sass Rubin
    • Associate Professor, Rutgers University
    The premise that America's schools are failing, which lies at the core of this article and the entire US Competitiveness Project, is false!

    As the noted education historian Diane Ravitch and many, many other scholars have pointed out, our public schools are doing better than ever in terms of test scores, graduation rates, and dropout rates.

    The myth of US school failure is an ideological position, akin to arguing there is no global warming.

    As an alum of Harvard Business School's MBA program and the joint PhD program, and a professor of public policy who studies these issues, I am saddened to see HBS faculty repeating dogma rather than looking at the data.

    For example, promoting "school choice" as a benefit goes against study after study that confirm vouchers and charter schools actually increase inequality without improving educational outcomes. And that does not even begin to address the exploitation and corruption surrounding for-profit charter chains.

    Why can't HBS highlight the real issue for American public schools? The children attending those schools are increasingly low-income, reflecting the growing poverty and inequality in our country as a whole. Lower-income children score lower on standardized tests. The correlation between the two is irrefutable.

    If international test scores are controlled for income, the US actually comes out on top. No other industrialized country has a quarter of its children living in poverty as we do, so comparing our test score performance to that of Singapore, where poverty is virtually non-existent, is ridiculous.

    Lower test scores by low-income students do not reflect the poor quality of our public schools. They reflect all the other variables that shape the educational performance of children living in poverty - poor nutrition, unsafe living conditions, parents who are themselves not educated and may not speak English.

    The data on all of this is irrefutable.

    HBS can help highlight and address that poverty and inequality. That would reflect real leadership.

    Instead, HBS is promoting the lie that our public schools are failing and the solution is privatization.

    That is not research. It is ideology and it is false.

    I am ashamed of my Alma mater.
    • Brian Kaplan
    • Executive Director, IISME
    This article is spot on! There are frankly few meaningful programs where teachers are able to learn from being placed in corporate settings. At IISME ( we have developed relationships with more than 50 companies in Silicon Valley and across the Bay Area that host teachers for summer fellowships. We then work with the teachers to translate their summer experiences into relevant and engaging lessons for their students. Students are excited to see the connection between their studies and the world of work and see their teachers in a new light when they tell them the lesson directly connect to their summer experience at Google, Cisco, or Lockheed Martin.
    • Rima Hyder
    • VP, Investor Relations, Houghon Mifflin Harcourt
    No where in this article or in any of the comments, have we addressed another big issue for the stagnant education system..........teachers. Without good and effective teachers, schools will not improve. Schools that were failing 50 years ago are still failing because they don't have good teachers and they have continued to reward poor teachers for simply showing up to class.
    • Larry Zurmuhl
    • Consultant
    I think the number one area to start is accountability in the money that is already spent by school districts. If you try to question the school board it is a brick wall and more money is the answer to any problem. Taxpayers are weary of the request that if we only spend more money it will be made right and everything will improve.

    I do not think any additional funding will come from local government or taxpayers until the accountability issue is addressed and there is transparency. Without accountability you will never get the support.
    • Charles H. Green
    • Founder, CEO, Trusted Advisor Associates
    Anyone reading this article should immediately go read Rachel Aviv's powerful article in the current New Yorker, titled Wrong Answer. It provides a powerful counter-argument to several of the ideas in this article.

    Yes, there's a lot business can do to improve education, and yes we all have a lot at stake in it. The problem arises when a particular blind spot in most businesspeople rears its ugly head - and about half this article is infected with it.

    The blind spot is the unchallenged belief in scaling, metrics, and testing.

    To go from "there are lots of local success stories" to "the problem is how to scale them up" is a fallacy. The problem is not how to scale, the problem is how to encourage comparable results. You do not need databases, best practices, and - most especially - national standards to effect change.

    What we do need is an appreciation of the conditions under which education best happens. This is, by the way, NOT something which business happens to excel at.

    As the article notes, business is great at scaling and measuring; read Aviv's piece for a great human tragedy built on just such misguided ideas.

    Or, examine the fate of the similarly misguided $100M that Facebook CEO Mark Zuckerberg lavished on the Newark NJ schools. Another case of "business knows best" applied disastrously to an entirely different social system.

    Business can indeed influence education positively; but NOT by turning it into yet another business case.
    • Adlai Englard
    • Retired
    Having retired from the business world, I decided to take a course at a local university. This was my first time in an undergraduate classroom in over 30 years. The 24 students in the classroom, most of them humanities majors just a few months shy of receiving their bachelor's degrees, were very well versed with the technology --so well versed in fact that many of them had no trouble surfing the Internet, doing their shopping and apartment hunting from their computers while ostensibly listening to the professor's lecture. As part of a class assignment, I delivered a presentation on the life of Adlai Stevenson. Not a single student had ever heard of him, of course. But, most surprisingly, not a single one of those students had ever heard of his opponent in the presidential elections of 1952 and 1956, Dwight Eisenhower. I'm sure these students will do just fine without that bit of information, but what does it say about the state of the educ
    ation system when university students in the United States don't even know their own country's recent history? Have the schools and colleges been reduced to being merely baby-sitting institutions where students are warehoused until they are old enough to enter the workforce ? Obviously the educators have not done their job. Could business people do any worse?
    ( As a consequence of this experience, I ask every person in their twenties whom I encounter in the course of my travels whether they have heard of Dwight Eisenhower. So far, I have not met anyone in that age group who has heard of him).