It is fashionable for governments to claim that they are bringing proven business practice into schools and colleges to raise standards. Marketing, flexible contracts, customer care, accountability and investment in people are some of the terms which pepper education policies.
But do these approaches work? The truth is that no one knows. A few local case studies of business-managed schools in the United States indicate potential gains. In the UK, participants say that partnerships such as headteacher mentoring and access to business management training have helped.
However, to plump for business methods is a risk. Risk-taking is driven by the need to raise standards to match those of our international competitors and to tackle the 20 per cent of underachievers cost-effectively. The 25 new education action zones to target underachievement will increase budgets by about 5 per cent. But only 400 of the thousands of schools and colleges in need will benefit. This indicates how little cash is in the coffers and how far we are turning to business to help make up the difference.
The current market model was designed by the Conservatives. Customer choice, open access and competitive marketing were supposed to promote high-performing schools and colleges and close down failing institutions or force them to reform. A decade of evidence indicates a modest overall improvement across the system while the numbers of failing students have increased.
At last week's launch of Labour's Social Exclusion Unit there was evidence of the increasing "tail" of underachieving students. Exclusions have spiralled to more than 13,000 a year. Schools are excluding "disruptive" pupils in the hope of enhancing their exam performance and hence their appeal to parents. Competitive marketing may advance high-performing schools and colleges, largely in privileged areas and at the expense of at-risk students and other schools. But it does not help Britain tackle the tail of low achievement in deprived communities.
Other "business practices" are now creeping into education. Experienced and highly-skilled (more expensive) teachers and lecturers are moving out, especially from further education, to be replaced by short-term, temporary and agency-supplied staff. This trend threatens professional quality and destabilises career structures. It undermines the status of the profession and reduces teaching's appeal to top-level graduates.
Colleges are being given permission to adapt certain courses and qualifications to their own needs - but what is the evidence that reducing the formal training of nursery nurses and auxiliary teachers will maintain teaching quality and childcare in the vital new pre-school clubs? This is policy by guesswork and untried innovation. We are gambling with the future of education and the UK skills base.
What is most annoying about "business trends" in education is that no one in a successful company guesses about anything or works in this way. Decisions, especially on risk and innovation, are based on evidence and taken by proven managers in consultation with stakeholders (highly-informed shareholders and employees demand it). Successful UK businesses have world-class managers through long-term investment in management skills and perform well against global competition through investment in all levels of employment. Yet investment in the teaching profession at every level is not just minimal, it is a national disgrace.
Set this position against the facts of business life. Skilled business managers do not expose divisions characterised by years of under-investment and over-strained human resource to open markets (we do it daily to schools and colleges serving the most disadvantaged). Business leaders do not wait until markets destroy whole plants before reforming managements removing the incompetent and investing in under-performing divisions (we wait until the bitter end in education, ruining the life chances of thousands). Finally, human resource directors develop flexibility where there is evidence of long-term benefits in terms of attracting, retaining and developing staff and ensuring competitive productivity and adaptation to technological change (in education we use these as desperate means to save cash in the short-term or cut corners). All in all education is being exposed to bad business practice.
It is time this Government learnt the lesson its predecessors ignored, but one which is known to business managers. The central plank of successful business is investment in people. When I have taken business leaders to schools and colleges to learn that the human resource budget for a teacher could be less than Pounds 100 each year they were appalled that the education system could be so inept. Fast-track managers in top UK businesses will have more than Pounds 100,000 invested in their development - and companies know this will reap long-term pay back. Let's stop messing around with short-term cost-cutting and really adopt best business practice. A highly-skilled professional firm would invest 10-15 per cent of expenditure on human resource development - so should every school and college. This would mean re-allocating something like Pounds 4 billion a year to invest in initial training and the on-going professional development of teachers with senior staff receiving management training on a par with BT, KPMG, Marks and Spencer or Unilever. Let's see a government invest in teachers like business invests in its people. This is the only strategy proven to add value to performance, build the status of a profession and so attract and retain high quality teachers.
Ian Pearce is director of education for Business in the Community