Costs and Benefits in an eLearning context Why and how?

1. Costs and Benefits in an eLearning contextWhy and how? Sofia Lundberg Centre for Regional Science at Umeå University (CERUM), Sweden.

2. Agenda • Costs and benefits in an eLearning context – what can departments and teachers learn from such an analysis? • Short presentation of the eLene EE – project • Note: Very general presentation – there are several important differences that are not explained. For example how higher education is financed.

3. Why bother about costs and benefits? • Resources are limited and have alternative use. • Is there a better use of the resources we plan to invest? • Reasonable condition: The use of ICT in higher education should be efficient

4. Important difference • Analysis of costs and benefits • Cost-benefit analysis • Is there a difference? • Yes! • Is it important? • Yes (again)! • What is the difference and why is it important?

5. Analysis of costs and benefits • Whom: • Department • Faculty • University • Firm • Objective function: Balanced budget (or profit maximization) • Central questions: • Do we reach more students by the use of ICT in our learning processes? • Do our students perform better due to the use of ICT in our learning processes? • Are their scale opportunities that results in lower per student cost due to the use of ICT in our learning processes? • Ends when the student is trained • Alternative case to the planned investment: • What can the department etc do with it’s resources instead?

6. Cost-benefit analysis (CBA) • Whom: • Society: Local -, County -, State level, Region, International - the geographical boarder is flexible! • Objective function: maximize individuals welfare • Central questions: • Are there added values that are not measured by traditional investment analysis? • With these added values taken into consideration is the investment motivated from the society’s (defined by the geographical boarder) point of view? Do the costs exceed the benefits? • The student’s occupation after training is central • Alternative case to the planned investment: • What is the alternative occupation of the trained student?

7. The difference between analysis of costs and benefits and cost-benefit analysis The Society

8. Example: Case study of a Nursing Program, North Sweden • 31 students enrolled in a netbased Nursing program in Northern Sweden • Provider of training: Umeå university • Financed by: Swedish central, county and local government and Umeå University • Added costs compared to on campus traditional Nursing program: Yes! About twice as high per student cost. • Alternative case: No nursing training and students would remain in their occupation prior to education.

9. Example: Case study of a Nursing Program, North Sweden • Cost side (Rumble, 2001): • Costs of developing online learning materials: 283 300 € • The cost of e-delivery: 1 021 624 € • The cost of e-administration: 32 517 € • Loss of production: 17 310 477 • Benefit side (region): Production value 19 107 679 € • Net outcome: 836 049 € • Efficient use of resources from the perspective of the society: here defined as a region (13 municipalities in Northern Sweden). • Exact figure not so interesting – look at the sign (or relation to an alternative)! Same as a analysis of costs on e.g. department level

10. eLene EE: Main Purpose • Main purpose: This project aims to increase knowledge of the incentives to create virtual campuses and to initiate teaching methods in education and training built on virtual mobility and the effects of elearning and if it is efficient. • Target Groups: elearning units (for example HEI, schools, firms, external providers), learners (e.g. students, un-/employed people), financiers (private as well as public), and decision makers. • Financed by: DG EAC/23/05 (eLearning Programme) Virtual Campuses • Period February 2006 – January 2008. • Grand finale: Conference in Paris November 2007.

11. eLene partners that take part in eLene EE • UOC: Open University of Catalonia • PVU: Polish Virtual University • UMU: Umeå University (Project coordinator) • CANEGE: French consortia of five universities • METID: Politecnico di Milano • Interdisciplinary! • Information: www.elene-ee.net

12. eLene EE specific areas • WP 1 - Costs/benefits of elearning: • The main question in WP1 is whether or not e-learning is an efficient use of resources, i.e. what are the main benefits and costs for the society? • One important aspect of the analysis is to consider effects, or outcomes, for different stakeholders (e.g. students, universities, and policy makers). • Although an investment may be beneficial for one stakeholder, it might not be beneficial for another. This raises the question of how costs and benefits should be divided between stakeholders in order to create a correct incentive structure. • Empirical: case studies (questionnaire to students and documented information about costs) • Models: Literature Review

13. eLene EE specific areas • WP 2 - Student performance of elearning • The main questions in WP2 are if the uses of ICT affect student performance and if the uses of ICT affect student performance differently depending on the subject? • These are two important questions that need attention in order to ensure quality in and efficient training from virtual mobility including the right choice of tools available from existing technology. • WP2 aims to provide answers to these questions with hypothesis and data from ongoing training. • Students performing well are a condition for creating benefits in the context of WP 1. • Empirical: Data from different courses and programs in different countries complemented by a questionnaire to students and teachers. • Models: Literature Review

14. eLene EE specific areas • WP 3 - Indicators of elearning • Main target is to work on indicators relevant at HEI level and indicative for the regional, state or European ICT’s policy. Our challenge is collecting data on indicators of e-learning progression in HEI with information characterize them and useful to aggregate and analyze data on policy perspectives. • Example of simple indicators: Number of users of a specific tool, number of coursers etc.

15. eLene EE specific areas • WP 4 - Digital divides and elearning • While the dividend of Educational ICTs seems obvious, countries may not meet the appropriate conditions in using these technologies and may fall under the digital divide. These technologies may enhance social exclusion and different groups of the societies will not benefit from these technologies. The aims of this Work package 4 are threefold: • First, we want to characterize the variety of digital divides in matter of educational ICT and to understand how to bridge them? • Second, we want to illustrate the differences of the Digital Divide in terms of Uses. What factors contributing to it as well as its various forms. A special focus on the concepts of Digital Choice and Digital Trajectories will be done. • Third, what are the main explanations of digital divides in matter of performances? Why some institutions, students, countries are performing better than others? Is there any “productivity paradox” on the High Education sector? Is there a “Skill Biased Technological Change” in matter of Educational ICTs.

16. Summary • Difference in approach and objective function depending on if we perform • An analysis of costs and benefits • A cost benefit analysis (CBA) • It is important to do both! • Why bother? To ensure that you get the best value for money! • eLene EE: both types of analyses are performed. • More information www.elene-ee.net • Contact information mikael.sjoberg@cut.umu.se • Future ideas: • Netbased higher education (ICT in higher education) as a local policy tool?! • Questions? sofia.lundberg@econ.umu.se