Changing How We Think about Business Models

If we were designing a commercial aircraft, we would hand the engineers a set of desired specifications, say, 10,500 miles range (London to Sydney, about half-way around the world), fuel use, passenger load, and ETOPS parameters (the maximum length of time en route for the aircraft to reach an alternate airport). After cooking the numbers, exploring materials for weight, durability and so forth, the engineers would tell us what is possible (or not) and at what price.  Then the finance people would construct spreadsheets to forecast at what load factor and at what fare the plane would need to fly in order to make money for an airline. 

No amount of "wouldn't it be nice" or "I wish we could" is a substitute for trying every possible combination of designs, materials, loads or whatever in order to figure out whether, given what we know and have available, the specifications are even remotely possible.  

Independent school boards of trustees face a similar challenge with setting tuition.  Almost everywhere we go we hear lots of "wouldn't it be nice if we could actually reduce tuition," or "I wish we could be more affordable for more people."  How about treating this as a design problem?  Let's set the specifications (say, US$10,000 tuition, faculty/student ratio of 11:1, and anything else that seems meaningful) and then put people to the task of figuring out if it can be done, given what we know and have available.

Of course, every aircraft, whether a Boeing or Airbus design, is a compromise.  The world's longest range commercial airplane only flies a bit under 9,000 miles.  Fuel comsumption is almost always higher than would be preferred.  And, as we all know, passenger comfort ends up being less than those of us who fly would like.  The school we would create using the above approach would be a compromise, too.  Tuition might be higher, enrollment larger (or smaller), ratios different, but at least the board would understand why decisions were made as they were and at what trade-off.  And, just possibly, we all might benefit by some breakthrough thinking about how to deliver mission in as resource-efficient a manner as possible.