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New Commission on the Skills of the American Workforce

May 2007 ETS – Princeton, NJ

www.sedona-edge.com WhatWhat isis atat stakestake forfor America?America?

A possible free fall of America’s standard of living

Loss of trading markets

America’s hold on of which we had assumed we were the world’s major provider June 07 Beginnings…

June 07 TheThe SituationSituation inin 19891989

400

300

200

100 0 1969 1972 1975 1978 1981 1984 1987 WEEKLY

Data from the Current Survey of the US Department of Labor - Average real wages corrected for inflation WhyWhy WeWe CreatedCreated thethe FirstFirst CommissionCommission

WorkersWorkers’’ incomeincome inin freefree fallfall WhyWhy WeWe CreatedCreated thethe FirstFirst CommissionCommission

US LABOR PRODUCTIVITY GROWTH

2.0%

1.5%

1.0%

0.5%

0.0% GROWTH RATE 1973-1990 1990-1995 1995-2000 2000-2005 PERIOD USUS ProductivityProductivity growthgrowth flatflat WhyWhy WeWe CreatedCreated thethe FirstFirst CommissionCommission EconomistsEconomists saidsaid thatthat wageswages inin advancedadvanced industrialindustrial nationsnations wouldwould fallfall untiluntil theythey camecame intointo equilibriumequilibrium withwith risingrising wageswages inin advancedadvanced developingdeveloping nationsnations ButBut somesome wageswages areare risingrising inin thethe samesame advancedadvanced nationsnations thatthat werewere leadingleading thethe listslists inin lowerlower secondarysecondary educationeducationJune 07 performanceperformance WhatWhat WeWe FoundFound —— andand AssumedAssumed TheseThese nationsnations werewere leavingleaving thethe lowlow skillskill jobsjobs toto thethe lostlost costcost producersproducers andand movingmoving upup thethe valuevalue chainchain ThatThat requiredrequired educatingeducating manymany moremore studentsstudents toto aa muchmuch higherhigher standardstandard WeWe assumedassumed thatthat onlyonly thethe advancedadvanced industrialindustrial countriescountries couldcould makemake thisthis investmentinvestment andand wouldwould notnot competecompete onon wageswages June 07 HowHow thethe WorldWorld HasHas ChangedChanged SinceSince 19901990 ......

And The New Sources of Comparative Advantage

June 07 $280

$275

$270

$265

WhatWhat$260 isis thethe SituationSituation Now?Now?

$255

$250

$245 1985 1990 1995 2000 2005 WEEKLY WAGES High in previous period was $331 After boost from productivity uptrend in 90s, now resuming downward curve 1.1. TheThe AsianAsian ChallengeChallenge 1.1. TheThe AsianAsian ChallengeChallenge

IndiaIndia andand ChinaChina combinedcombined producingproducing 950,000950,000 engineersengineers perper yearyear AboutAbout 135,000135,000 engineersengineers perper yearyear ofof internationalinternational qualityquality (compared(compared toto 60,00060,000 forfor thethe US)US) andand growinggrowing fastfast ManyMany studentsstudents whowho camecame toto USUS fromfrom ChinaChina andand IndiaIndia andand stayedstayed areare nownow returning.returning. OthersOthers areare stayingstaying homehome EngineerEngineer GraduatesGraduates perper YearYear

600,000

500,000

400,000

300,000 600,000

200,000 350,000 100,000 220,000

0 US China India India and China combined producing 135,000 per year of internationalinternational qualityquality (compared to 60,000 for the US) $60,000

$50,000

$40,000

$30,000 $55,070 $20,000

$10,000 $10,000 $4,800 $0 US China India 1.1. TheThe AsianAsian ChallengeChallenge

LargeLarge fractionsfractions ofof ourour mostmost successfulsuccessful computercomputer andand communicationscommunications executivesexecutives andand technicaltechnical subjectsubject professorsprofessors areare fromfrom IndiaIndia andand China;China; theirtheir lossloss wouldwould bebe aa majormajor problemproblem forfor thethe USUS 1.1. TheThe AsianAsian ChallengeChallenge

300300 millionmillion inin thethe USUS areare competingcompeting againstagainst 2.52.5 billionbillion inin thesethese twotwo countries.countries. ThusThus allall ofof usus areare competingcompeting againstagainst thethe toptop 1/81/8 ofof them.them. ButBut lessless thanthan halfhalf ofof usus achieveachieve anan 8th8th gradegrade levellevel ofof literacyliteracy beforebefore leavingleaving highhigh school.school.

June 07 1. The Asian Challenge

BothBoth IndiaIndia andand ChinaChina havehave concentratedconcentrated forfor decadesdecades onon educatingeducating theirtheir eliteselites toto worldworld standardsstandards -- withwith ourour graduategraduate schoolsschools aa linchpinlinchpin ofof thatthat strategystrategy.. June 07 1.1. TheThe AsianAsian ChallengeChallenge

InIn aa nutshell,nutshell, wewe mustmust figurefigure outout howhow ourour toptop halfhalf cancan competecompete againstagainst theirtheir toptop 88 percentpercent whenwhen theythey areare chargingcharging farfar lessless thanthan halfhalf ofof whatwhat wewe chargecharge forfor thethe samesame June 07services.services. June 07 China and India are just part of the much broader picture The U.S. was the undisputed attainment leader over the whole of the last century

• The educated in the U.S. is becoming a smaller fraction of the world’s educated elite at an increasing speed with every

Junepassing 07 year Attainment in U.S. is stagnant; many others are overtaking us

June 07 Many others are overtaking us!

June 07 2. THE ATTAINMENT CHALLENGE

PERCENT OF WORKING AGE ADULTS WITH UPPER SECONDARY QUALIFICATIONS

100 1960's 1970's 1980's 1990's

90

80

70

60

50

40

30

20

10

0 Italy Spain Korea Poland France Japan Japan Finland Greece Mexico Austria Iceland Belgium Ireland Norway Canada Turkey Turkey Sweden Germany Portugal Portugal Hungary Hungary Denmark Australia Netherlands Switzerland Switzerland Luxembourg Luxembourg New ZealandNew United States United Kingdom Slovak Republic Slovak Czech Republic June 07 3. Advent of Digitized Work Tom Friedman’s thesis: Much work, including professional work, is being digitized at an increasing rate. CanCan bebe donedone byby anyoneanyone anywhereanywhere whowho hashas accessaccess toto thethe .internet. FirmsFirms areare creatingcreating worldwideworldwide workwork teamsteams ofof suchsuch peoplepeople 4. The Modularization

of Industry 4. The Modularization of Industry

ProductionProduction ofof bothboth goodsgoods andand servicesservices increasinglyincreasingly fragmentedfragmented andand modularmodular FirmsFirms areare concentratingconcentrating onon whatwhat theythey cancan dodo bestbest inin thethe world,world, outsourcingoutsourcing everythingeverything elseelse 4. The Modularization of Industry

TheThe quintessentiallyquintessentially AmericanAmerican modelmodel ofof thethe verticallyvertically integratedintegrated firmfirm isis disappearingdisappearing

DominanceDominance inin anyany particularparticular functionfunction subjectsubject toto constantconstant challengechallenge fromfrom anotheranother firmfirm thatthat hashas aa betterbetter ideaidea —— ideasideas andand thethe abilityability toto carrycarry themthem toto scalescale quicklyquickly areare thethe keykey toto successsuccess

5. Automation of Routine Work

• We were right in 1990: Low skilled work is migrating to low cost producers; American workers no longer competitive in that market • Transfer takes place not by outsourcing but by transfer of

Juneinvested 07 capital 5. Automation of Routine Work

• Routine work is not done only by low- skilled workers; many routine are done by white collar workers

June 07 5. Automation of Routine Work

• But the most important trend is the replacement of people doing routine work by machines that can do it better and cheaper

June 07 June 07 Industrial automation

June 07 Industrial automation

June 07 Robomower

RoboticRobotic LawnmowerLawnmower June 07 June 07 ƒNano technology (eg: fibers stronger, lighter and cheaper than steel that can be used for building materials)

June 07 ƒ Genetic engineering (eg: a second green revolution of foodstuffs that require no insecticides and much less fertilizer and water to produce a given yield)

June 07 ƒSeveral technologies available today that can boost auto mileage to 75 or more miles/gallon for mid-size cars ƒHydrogen fuel cells that will produce no pollutants whatsoever June 07 ƒƒ TheseThese andand manymany otherother technologiestechnologies nownow onon thethe drawingdrawing boardsboards havehave thethe potentialpotential toto replacereplace notnot justjust particularparticular jobsjobs oror firms,firms, butbut entireentire industries,industries, especiallyespecially asas newnew energyenergy sourcessources andand materialsmaterials areare

June 07introducedintroduced ƒ If the United States is the first to introduce and commercialize many of these new technologies, we may be able to sustain a high employment, high economy – If we do not … we have no chance of doing so! June 07 ¾Corollary to the decline of routine work is the rise of non-routine — or creative work.

June 07 ¾This is the work at the top of the value chain — what the world pays the most for: the work of producers, actors, painters, marketing people, teachers, , journalists, statesmen, business strategists, economists and software engineers June 07 ¾Creative — and not just professional — because it implies work that produces something that incorporates the latest technology, the latest fashion, the most powerful and appealing aesthetic, the form or function Junethat 07 just exactly suits the user. ¾Top dollar is paid to these people because they are responsible for the emergence and success at scale of new products, new services and new industries June 07 ¾The country that succeeds will produce and retain more of these people than any other

June 07 ¾The is restless, anti-bureaucratic and ambitious.

June 07 ¾It is comfortable with ideas, articulate, good at analysis but, even more important, synthesis, pattern recognition and inductive reasoning.

June 07 ¾Its members thrive in chaos, like learning, value excellence, prefer to be in stimulating environments with others like themselves.

June 07

June 07 1. Get it right the first time 2. Extend preschool to three and four year olds for all people, most emphatically among and minority groups 3. Issue competitive grants of $500 for every US child born – to be drawn upon for life for retraining, for work and professional transition as a growth annuity June 07 4. More choices, more diverse schools, usually run by teachers who respond to high performance standings set by states. 5. Governance – should change or step aside. Lay board’s may be major obstacle. Their 40 to 50 year record – low performing schools in the thousands,

June 07 more likely, several thousands! 6. Lop off 11th & 12th grades of high schools – admit students by exams to universities, colleges, community colleges and technical colleges

June 07 7. Create regional economic development authorities ¾ Link economic development policy to training and education strategy ¾ Economic engines based on clustered economic development and high skilled jobs ranging from manufacturing processes, medical and pharmaceutical protocols, chemical washes and solvents for green safety, organizational creativity and the rise

June 07 of the creative class 7. Create regional economic development authorities

¾ Greater emphasis on entrepreneurialism

¾ Democratize wealth creation!

June 07 8. Revise standards, assessments and curriculum that meets today’s and future needs 9. Recruit from the upper tier of graduates for teachers. Starting between $95,000 to $110,000 with incentive to earn more based on exceeding June 07performance standards 10.Place support where it is needed most – less on those who do well anyway ¾ Make educational performance classless, no longer based on advantage and socio- economic circumstance. ¾ Transcend circumstance to achieve universal high performance. June 07 PrototypicalPrototypical U.S.U.S. IndustryIndustry inin 1010 YearsYears IfIf AllAll GoesGoes WellWell

Creative work : Research, Development, Design, Marketing and Sales, Global Supply Chain In the United States Management, Etc.

Routine work done Routine work done by machines by people

In Less Developed Countries June 07

ModelingModeling thethe LastLast 22 DecadesDecades

Top Skills/Income

Middle Skill/Income ...... …… ...... … .. … ...... … … ...... … ...... …. .. . .… ...... …. ... . …...... Bottom Skills/Income

Industry I Industry II Industry III

NB: Dots represent jobs lost to outsourcing and automation

June 07 TheThe AmericanAmerican EconomyEconomy inin 1010 YearsYears WithWith CurrentCurrent DynamicDynamic

. . Top Skills/Income ...... …...... Middle Skill/Income ...... … … ...... … ...... … ...... … . … .... .… ...... … ...... …...... Bottom Skills/Income

Industry I Industry II Industry III

NB: Dots represent jobs lost to outsourcing and automation

June 07 June 07 June 07 ContinuousContinuous InnovationInnovation andand LearningLearning ——TheThe OnlyOnly SourceSource ofof CompetitiveCompetitive AdvantageAdvantage

z OurOur ownown researchresearch z PresidentPresident’’ss CouncilCouncil onon ScienceScience andand TechnologyTechnology z CouncilCouncil onon CompetitivenessCompetitiveness z MITMIT IndustrialIndustrial PerformancePerformance CenterCenter

June 07 GeoxGeox ShoesShoes

z HowHow MarioMario Polegato,Polegato, inin Reno,Reno, cutcut holesholes inin thethe solessoles ofof hishis shoesshoes toto ventvent perspirationperspiration z StartedStarted 19951995 ——3030 patentspatents laterlater…… z 5,0005,000 employeesemployees worldwide;worldwide; companycompany worthworth $1.5$1.5 billionbillion z ShoesShoes designeddesigned inin Italy,Italy, mademade inin RumaniaRumania andand ChinaChina z LegacyLegacy ofof regionalregional skillsskills inin shoemakingshoemaking z BigBig continuingcontinuing investmentsinvestments inin researchresearch andand technologytechnology

June 07 AvondaleAvondale MillsMills

z OldestOldest continuingcontinuing textiletextile manufacturingmanufacturing companycompany inin U.S.U.S. z $1$1 billionbillion inin salessales z InvestsInvests heavilyheavily inin appliedapplied technologytechnology andand innovation,innovation, includingincluding nonnon--wovenwoven textilestextiles andand ““smartsmart fabricsfabrics”” basedbased onon nanotechnologynanotechnology z WinnerWinner ofof 20022002 InnovationInnovation AwardAward fromfrom TextileTextile WorldWorld magazinemagazine

June 07 TimkenTimken CompanyCompany

z HighlyHighly successfulsuccessful manufacturermanufacturer ofof rollerroller bearingsbearings andand alliedallied productsproducts z ManufacturingManufacturing highlyhighly automatedautomated z LaborLabor contentcontent ofof productproduct veryvery lowlow z ManufacturingManufacturing employeesemployees veryvery wellwell paidpaid z CostCost ofof manufacturingmanufacturing inin U.S.U.S. outweighedoutweighed byby advantageadvantage ofof locatinglocating nearnear customercustomer

June 07 DellDell ComputerComputer z MostMost successfulsuccessful computercomputer manufacturermanufacturer inin thethe worldworld z UsesUses mainlymainly partsparts availableavailable toto anyoneanyone else,else, manufacturedmanufactured inin worldworld’’ss lowlow costcost productionproduction centerscenters z FinalFinal assemblyassembly inin U.S.U.S. becausebecause costscosts ofof doingdoing thatthat outweighedoutweighed byby advantagesadvantages ofof beingbeing ableable toto customizecustomize productproduct andand deliverdeliver itit quicklyquickly

June 07 TheThe EntertainmentEntertainment IndustryIndustry z MajorMajor exporter,exporter, 2nd2nd onlyonly toto aerospace,aerospace, revenuesrevenues toto growgrow toto $1.8$1.8 trilliontrillion byby 20092009 z ManyMany separateseparate technologiestechnologies collapsingcollapsing intointo oneone integratedintegrated industryindustry withwith repurposedrepurposed contentcontent z ArchetypeArchetype ofof industryindustry thatthat dependsdepends onon technologicaltechnological leadership;leadership; alsoalso ofof industryindustry thatthat succeedssucceeds byby networkingnetworking andand managingmanaging disparatedisparate teamsteams ofof highlyhighly creativecreative peoplepeople z DigitizationDigitization andand modularizmodularizationation creatingcreating opportunitiesopportunities forfor India,India, NZNZ andand othersothers June 07 TelecommunicationsTelecommunications z ExampleExample ofof anan industryindustry thatthat maymay bebe losinglosing technologicaltechnological leadershipleadership inin crucialcrucial areaarea z 1414 countriescountries havehave greatergreater numbersnumbers ofof broadbandbroadband subscribers/100subscribers/100 inhabitantsinhabitants thanthan U.S.;U.S.; eveneven furtherfurther behindbehind inin wirelesswireless accessaccess toto internetinternet z BroadbandBroadband isis thethe technologytechnology frontierfrontier forfor broadbroad scalescale improvementsimprovements inin industrialindustrial productivity;productivity; ifif otherother countriescountries becomebecome thethe locationlocation forfor statestate--ofof--thethe--artart broadbandbroadband development,development, seriousserious damagedamage couldcould resultresult toto thethe U.S.U.S. economyeconomy

June 07 WhereWhere WillWill thethe CustomersCustomers ComeCome From?From? z TheThe WorldWorld’’ss RapidlyRapidly ExpandingExpanding MiddleMiddle ClassClass z WhatWhat ““middlemiddle classclass”” meansmeans inin AsiaAsia

June 07 What Will It Take To Succeed in This Environment?

1.Unique products and services 2.Much better education 3.A very different kind of education

June 07 WhatWhat WillWill ItIt TakeTake toto SucceedSucceed InIn ThisThis Environment?Environment?

z ProductsProducts andand ServicesServices ThatThat OfferOffer SomethingSomething ThatThat NoNo OneOne ElseElse CanCan OfferOffer z New Technology z Great Design z Great New Features z Something That Expresses Me z The Next “Big New Thing” z Something I Can Afford

June 07 WhatWhat WillWill ItIt TakeTake ToTo SucceedSucceed InIn ThisThis Environment?Environment?

z StateState ofof thethe ArtArt TechnologyTechnology z EnormousEnormous CreativityCreativity z EndlessEndless InnovationInnovation z HighHigh LevelsLevels ofof KnowledgeKnowledge andand CompetenceCompetence z AbilityAbility toto DealDeal WithWith ComplexityComplexity z FlexibilityFlexibility z ConstantConstant OrganizationalOrganizational andand PersonalPersonal LearningLearning z Flexibility,Flexibility, Grit,Grit, Determination,Determination, ResourcefulnessResourcefulness z EmpathyEmpathy z IntimateIntimate KnowledgeKnowledge ofof SocietiesSocieties AroundAround thethe GlobeGlobe June 07 RoleRole ofof TraditionalTraditional AchievementAchievement z ImportanceImportance ofof strongstrong foundationfoundation inin mathmath andand sciencescience forfor maintainingmaintaining technologytechnology leadershipleadership z ImportanceImportance ofof languagelanguage skillsskills forfor crucialcrucial functionfunction ofof communicationscommunications z ImportanceImportance ofof analyticalanalytical skillsskills forfor broadbroad rangerange ofof economiceconomic functionsfunctions

June 07 ImportanceImportance ofof thethe ““CreativeCreative ClassClass”” z HighHigh--end,end, highhigh marginmargin dependsdepends onon thisthis talenttalent z USUS usedused toto havehave aa cornercorner onon thesethese peoplepeople z NowNow globalglobal competitioncompetition forfor themthem z 1/41/4 ofof scientistsscientists andand engineers,engineers, 40%40% ofof engineeringengineering professors,professors, moremore thanthan halfhalf ofof Ph.Ph. DsDs inin engineering,engineering, computercomputer sciencescience andand lifelife sciencessciences areare foreignforeign bornborn z FilmFilm andand musicmusic industriesindustries worldworld widewide magnetsmagnets forfor talenttalent z SurvivalSurvival dependsdepends onon growinggrowing ourour ownown

June 07 InIn aa NutshellNutshell

z MuchMuch BetterBetter EducatedEducated

z We will have to match the top nations in performance on PISA in language, math and science

z VeryVery DifferentlyDifferently EducatedEducated

z Major changes needed in standards, assessments, curriculum and pedagogy to reflect new requirements June 07 What We Have Going For Us and… The Challenges Ahead

June 07 WhatWhat WeWe’’veve HadHad GoingGoing ForFor UsUs z Superior Infrastructure For Investment in Risky Enterprises z Low Penalties for Failure of Unsuccessful Enterprises z Global Magnet For Bright, Ambitious, Well Educated People z Biggest National Investment in Basic Research z Best Graduate Education in the World z Strong System of Elite Education in the Lower Schools

June 07 TheThe ChallengesChallenges II z USUS hashas aa veryvery weakweak systemsystem ofof primaryprimary andand secondarysecondary education,education, mostmost ofof ourour collegescolleges areare ofof indifferentindifferent qualityquality andand onlyonly ourour postgraduatepostgraduate institutionsinstitutions setset thethe worldworld standardstandard z IfIf nothingnothing isis done,done, futurefuture forfor thethe majoritymajority ofof ourour childrenchildren andand forfor adultsadults withwith lowlow literacyliteracy isis muchmuch bleakerbleaker thanthan isis widelywidely assumedassumed z RisingRising proportionsproportions ofof ourour populationpopulation mademade upup ofof groupsgroups thatthat havehave veryvery lowlow attainmentattainment

June 07 ChallengesChallenges IIII z ChinaChina hashas aa strategystrategy toto raiseraise thethe performanceperformance ofof thethe ruralrural poorpoor andand thethe urbanurban elite;elite; IndiaIndia’’ss policiespolicies weak,weak, butbut eliteelite educationeducation steadilysteadily expandingexpanding anyway,anyway, respondingresponding toto demanddemand z NCLBNCLB hashas raisedraised thethe barbar atat thethe bottom,bottom, butbut probablyprobably atat thethe expenseexpense ofof loweringlowering thethe performanceperformance ofof allall ourour otherother studentsstudents z WeWe need,need, andand dodo notnot have,have, powerful,powerful, coordinatedcoordinated strategiesstrategies forfor greatlygreatly raisingraising thethe floorfloor andand expandingexpanding thethe peakspeaks

June 07 TheThe ChallengesChallenges IIIIII

z Highly educated foreign nationals either not coming here to get educated or returning home when they get their degrees

z Public disinvestment in higher education

z Public and private disinvestment in basic research

z Technical education greatly diminished

z Our elementary and secondary education system getting progressively less efficient

z Global companies no longer dependent on our education system’s results June 07 DriversDrivers ofof HighHigh Performance?Performance? TheThe OECDOECD AnalysisAnalysis 1. The best performers 2. The greatest value 3. Challenge and support: An analytical construct 4. The drivers 5. The “ society” and “knowledge work” 6. Are we trying to build “knowledge worker” skills with an industrial age education system?

June 07 OECD:OECD: GreaterGreater EquityEquity andand HigherHigher PerformancePerformance z FinlandFinland z CzechCzech RepublicRepublic z NetherlandsNetherlands z DenmarkDenmark z JapanJapan z FranceFrance z BelgiumBelgium z SwedenSweden z SwitzerlandSwitzerland z AustriaAustria z AustraliaAustralia z GermanyGermany

June 07 OECD:OECD: BestBest ValueValue forfor ExpenditureExpenditure

z AustraliaAustralia z FinlandFinland z BelgiumBelgium z KoreaKorea z CanadaCanada z JapanJapan z CzechCzech RepublicRepublic z NetherlandsNetherlands

June 07 OECD:OECD: ChallengeChallenge andand SupportSupport HIGH SUPPORT

Poor performance, Strong performance Improvements idiosyncratic Systemic improvement

LOW CHALLENGE HIGH CHALLENGE

Poor performance Conflict Stagnation Demoralisation

LOW SUPPORT

June 07 OECDOECD’’SS DRIVERSDRIVERS z HighHigh ambitionsambitions z Devolved z ClearClear standardsstandards responsibility, the z AccountabilityAccountability andand school as center of interventionintervention inin inverseinverse action proportionproportion toto successsuccess z Individualized learning z Integrated educational z AccessAccess toto bestbest opportunities practicepractice andand qualityquality z High quality pastoral professionalprofessional care developmentdevelopment

June 07 OECD:OECD: EducationEducation forfor aa KnowledgeKnowledge SocietySociety

THE FUTURE OF EDUCATION Creating a knowledge-rich profession in which schools and teachers have the authority to act, the necessary knowledge to do so wisely, and access to effective support systems

Informed professional judgement, the teacher as a Informed prescription National “knowledgeProfessional worker” prescription judgement

Uninformed prescription, Uninformed professional teachers implement judgement curricula

The tradition of education systems has been “knowledge June 07 poor” THESIS:THESIS:

WeWe areare tryingtrying toto produceproduce 21st21st centurycentury knowledgeknowledge workersworkers withwith aa 20th20th centurycentury systemsystem designeddesigned toto produceproduce workersworkers forfor aa massmass productionproduction economyeconomy

June 07 Should We Be Hiring Further Up The Queue and Changing the Progression Through the System?

1. Teacher and leader quality 2. System efficiency 3. Student Motivation 4. Competition and innovation

June 07 TheThe QualityQuality ofof TeachersTeachers andand LeadersLeaders z What would we have to do to hire (and retain) much higher off the queue? z amount and structure of compensation z training z work organization and management system z workplace culture z Should we adopt a system similar to that of the British to recruit and train teachers? z How would collective bargaining have to be changed to turn teaching into a true profession of “creatives”?

June 07 WhereWhere WouldWould WeWe GetGet thethe Money?Money? MakeMake thethe SystemSystem MoreMore Efficient!Efficient!

z AA largelarge fractionfraction ofof thethe studentsstudents whowho gogo toto ““collegecollege”” readread atat anan 8th8th gradegrade levellevel oror lowerlower —— soso theythey areare reallyreally enteringentering 9th9th grade,grade, notnot collegecollege z NAEPNAEP 4th4th gradegrade readingreading scoresscores havehave beenbeen levellevel forfor 3030 yearsyears whilewhile costscosts havehave increasedincreased byby aa factorfactor ofof 2.5.2.5.

June 07 22 KeysKeys toto SystemSystem EfficiencyEfficiency z GettingGetting itit rightright thethe firstfirst time,time, ratherrather thanthan ““reworkingreworking”” atat everever higherhigher costcost asas ourour studentsstudents getget olderolder z Analogy to what our best firms had to do in the late 70s when attacked by Japanese firms that produced better quality at lower cost z GreatlyGreatly increasingincreasing studentstudent motivationmotivation toto taketake toughtough coursescourses andand studystudy hard,hard, asas thethe AsiansAsians dodo z The most important explainer of Asian achievement is the motivation of their students

June 07 AnAn Idea:Idea: ChangeChange thethe ProgressionProgression

[SEE HANDOUT]

June 07 HowHow WouldWould ItIt Work?Work? z HowHow studentsstudents progressprogress throughthrough thethe systemsystem z TheThe ideaidea ofof anan examexam--basedbased systemsystem z NoNo deaddead endsends z InstitutionalInstitutional competitioncompetition z FreeFree throughthrough endend ofof collegecollege z DollarsDollars followfollow thethe studentstudent z Savings:Savings: Remediation,Remediation, yearyear ++ ofof totaltotal costscosts z PlowedPlowed backback intointo increasedincreased teachersteachers’’ pay,pay, earlyearly childhoodchildhood educationeducation

June 07 StudentStudent MotivationMotivation

z TheThe otherother sideside ofof aa systemsystem withwith endlessendless ‘‘secondsecond chanceschances’’ z HowHow wewe sendsend thethe wrongwrong signalssignals toto ourour studentsstudents aboutabout whatwhat itit takestakes toto succeedsucceed inin thethe worldworld z WhatWhat itit wouldwould meanmean toto givegive studentsstudents manymany shotsshots atat thethe targettarget withoutwithout movingmoving thethe targettarget z ImpactImpact onon resourcesresources availableavailable forfor twotwo otherother keykey componentscomponents ofof motivation:motivation: engagementengagement andand supportsupport June 07 TheThe LiberalLiberal ArtsArts RedefinedRedefined

z “College” is where we define general education — Strong communication and math (analytical) skills,sound conceptual grasp of science, the roots and conditions of democracy, design skills, creativity in many forms, understanding of other peoples, exposure and analysis to the great works of art, technological competence, the ability to work in teams and to lead,etc. z Here is where we figure out what it actually means to learn how to learn z Who should control this agenda? Should states adopt an examination board system? Should boards allow for different concentrations, levels of mastery?

June 07 TechnicalTechnical EducationEducation z VeryVery fewfew highhigh schoolsschools havehave thethe resourcesresources toto offeroffer sound,sound, currentcurrent technicaltechnical educationeducation programs;programs; onlyonly thethe technicaltechnical andand somesome communitycommunity collegescolleges do.do. z SoSo whywhy notnot letlet thosethose studentsstudents whowho wantwant thisthis kindkind ofof educationeducation gogo toto thethe institutionsinstitutions thatthat dodo itit well?well? z WhyWhy notnot putput anan exploratoryexploratory frontfront endend onon thethe system,system, andand offeroffer optionaloptional coursescourses toto qualifyqualify studentsstudents toto taketake thethe universityuniversity boardboard exams?exams?

June 07 CompetitionCompetition andand InnovationInnovation z LetLet highhigh schools,schools, communitycommunity colleges,colleges, technicaltechnical collegescolleges andand fourfour yearyear collegescolleges competecompete forfor thethe newnew ‘‘collegecollege’’ studentsstudents z IfIf thethe dollarsdollars followfollow thethe students,students, theythey willwill competecompete onon qualityquality andand innovationinnovation andand thatthat competitioncompetition cancan onlyonly benefitbenefit thethe studentsstudents andand theirtheir familiesfamilies

June 07 Should We Adopt A Management Schema Designed For Knowledge Workers? 1. Set clear goals and appropriate measures 2. Push decisions as to how to achieve those goals as far down in the organization as possible 3. Incent the people on the front line to achieve those goals 4. Slim down middle management and change it’s role from direction to support, support, support 5. Measure, analyze and reward

June 07 1.1. GoalsGoals andand MeasuresMeasures z TheThe critique:critique: z Standards brokered, not coherent, not matched to this analysis, often provide inadequate guidance as to what is expected, often not relevant because not well matched to tests z Tests not the logical extension of curriculum (as in syllabus driven exams), overly driven by psychometric considerations, based on brokered selection of items from test banks, therefore no more coherent than standards, not well matched to standards, limited to narrow range of cognitive outcomes

June 07 1.1. GoalsGoals andand MeasuresMeasures z ShouldShould wewe gogo toto aa systemsystem ofof nationalnational andand statestate boards,boards, supplementedsupplemented byby aa setset ofof approvedapproved privateprivate boards?boards? z ShouldShould wewe replacereplace NAEPNAEP withwith PISA,PISA, oror shouldshould thosethose statesstates thatthat wantwant toto dodo soso adoptadopt PISA?PISA? z WhatWhat cancan wewe learnlearn fromfrom thethe bestbest standardsstandards andand examexam systemssystems inin thethe worldworld aboutabout whatwhat makesmakes themthem effectiveeffective (eg:(eg: CambridgeCambridge IGSCE)?IGSCE)?

June 07 2.2. DevolutionDevolution

z TheThe Critique:Critique: z Authority and responsibility mismatched at every level of the system (eg: principals have most of the accountability and little authority, the converse for central office decision-makers) z Central office controls what it should not (eg: school staffing patterns and budgets) and does not seize control where it should (eg:create effective systems to reward school professionals who produce high student achievement and deal with those who don’t) z Result: Can’t hold the front line responsible for their work and can’t get the quality we need there June 07 2.2. DevolutionDevolution z How much control over budget, purchasing, program, staffing , hiring and firing should a principal have? Who should he or she share it with? z To what extent should the answer to the first question depend on how well the school is doing? What should trigger reductions in autonomy? Who decides? z Should the district and/or school be allowed to contract out functions that would plausibly be performed better or cheaper by others? z Should all schools in the district be public charter schools operating under performance contracts?

June 07 3.3. PerformancePerformance IncentivesIncentives

z TheThe Critique:Critique: z Student incentives to perform at high levels are very weak, compared to most other countries z Teachers are mainly incented to be loyal to those in authority; they have no formal incentives to produce the highest possible student performance z Principals’ incentives are mainly to play the politics of central office, please his or her other adult constituents and keep the peace z Central office’s incentives are to maximize their budget, staff and power at the expense of their colleagues z None of these people is incented to improve June 07 student performance, the ostensible goal of the whole system 3.3. PerformancePerformance IncentivesIncentives z HowHow cancan wewe provideprovide positivepositive incentivesincentives to:to: z Teachers z Principals z Entire school faculties z Central office staff z HowHow cancan wewe incentincent moremore competitioncompetition amongamong schools?schools? z HowHow cancan wewe incentincent facultiesfaculties toto raiseraise thethe barbar forfor allall studentsstudents,, notnot justjust thethe lowestlowest performers?performers? z WhoWho structuresstructures thethe incentivesincentives —— statestate oror district?district?

June 07 4.4. Support,Support, Support,Support, SupportSupport z TheThe Critique:Critique: z NCLBNCLB andand thethe accountabilityaccountability movementmovement generallygenerally havehave tightenedtightened thethe screws,screws, butbut providedprovided veryvery littlelittle practicalpractical help.help. LargeLarge citycity districtsdistricts havehave cutcut backback onon anan alreadyalready strainedstrained curriculumcurriculum andand PDPD staff.staff. StateState agenciesagencies areare atat barebare bones.bones. PublishersPublishers offeroffer littlelittle usefuluseful assistance.assistance. SchoolsSchools ofof educationeducation staffstaff commandcommand littlelittle respectrespect inin thethe schools.schools. ResearchResearch isis generallygenerally lowlow quality.quality. WhereWhere isis thethe helphelp toto comecome from?from?

June 07 4.4. Support,Support, Support,Support, SupportSupport z The crucial element here is the system’s capacity to support front line professionals, which is now very low; so: z Where is the best of the current capacity? z How and where do we concentrate it where it can do the most good? What is best done at the state level and what is best done at the district level? How does coherence play into the picture? Is there a role for an inspectorate? z What does central buy and what does it make? z How do we attract the best people to this workwork?? z How do we deploy them?

June 07 5.5. Measure,Measure, Analyze,Analyze, RewardReward z TheThe Critique:Critique: z When virtuous cycle works, staff up and down line are incented to constantly improve measured performance, so they are constantly analyzing performance for clues that will help them improve it; the cycle never stops because incentives never end z Some districts making headway on systems for gathering, storing, analyzing and publishing student performance and related data, but without reward element, measuring and analyzing will accomplish little

June 07 5.5. Measure,Measure, analyze,analyze, rewardreward z How do we build a continuous improvement system that creates a culture that rewards most those who are striving for better student performance? z How do we destroy a system that rewards loyalty over performance every time? z How do we create systems whose incentives to perform at ever higher levels outweighs the incentives to use the system to benefit the adults over the students?

June 07 WhatWhat AboutAbout StudentStudent Support?Support?

z WhatWhat wewe havehave seenseen abroadabroad z What is being tried and what seems to be working z Why it is important z IntegratedIntegrated socialsocial servicesservices inin thisthis countrycountry z WhyWhy mayoralmayoral controlcontrol isis importantimportant z MoreMore timetime forfor studentsstudents whowho needneed itit forfor studiesstudies andand forfor personalpersonal supportsupport

June 07 Do we have the capacity, where we need it, to do the ?

June 07 DoDo WeWe HaveHave thethe CapacityCapacity atat Central?Central?

z What capacity does the State Board of Education and State Department of Education need to play their new roles? z Authority? z Compensation? z Competence? z Organization? z How should responsibility bebe divideddivided betweenbetween statestate and districts? z Should big city systems (and perhaps others) be run by mayors?

June 07 What about those already in the workforce?

June 07 ForFor ThoseThose AlreadyAlready inin thethe WorkforceWorkforce z ShouldShould wewe eextendxtend thethe TradeTrade AdjustmentAdjustment AssistanceAssistance ActAct toto serviceservice workforce?workforce? z ShouldShould wewe createcreate aa BritishBritish style?style? entitlemententitlement forfor lowlow literacyliteracy workersworkers z ShouldShould wewe createcreate aa lifetimelifetime renewablerenewable educationeducation fundfund forfor adults?adults?

June 07 DesignDesign SpecificationsSpecifications z High, clear, coherent z Standards matched to real standards societal requirements z Accountability in inverse z High student motivation proportion to success z High quality staff z Access to best practice and z Strong incentives on staff to professional development improve student performance z Devolved responsibility with on the plains and at the peaks school at center z Authority and responsibility z Individualizes learning matched z Integrated educational z Strong support for staff opportunities z High system efficiency z High quality student support z Competition and innovation

June 07 June 07 June 07 SpaceSpace Station'sStation's roboticrobotic armarm

June 07 June 07 June 07 June 07 June 07 June 07 June 07 June 07 June 07 Shanghai JiaoTong University (SJTU) Research Institute of Robotics

June 07 SOCCER ROBOTS NASANASA MarsMars RoverRover

June 07 June 07 June 07