Indiana teams up with Western Governors University

By:

Aug 5, 2010

A fascinating development took place in education just weeks ago when Indiana Governor Mitch Daniels signed an executive order creating WGU Indiana, which will be Indiana’s eighth state university as well as a new branch of Western Governors University, which is a private, nonprofit online university designed for working adults.

The white labeling in effect is a brilliant move, as it allows Indiana to expand its state education system even as WGU Indiana will not be allowed to receive state funding like the other colleges because it will still be a private program technically. It will, however, allow students to use state scholarship money for tuition at WGU Indiana, which is about $6,000 a year.

With no additional state subsidies, that’s truly a low-cost degree any way you cut it at a quality institution that is helping to turn education around on its head with its competency-based degrees (as the eCampus News article about the announcement reads: “Students are charged a flat rate and move at their own pace instead of being charged per credit hour or semester.”) Looking just at tuition figures at public colleges is often misleading as an indicator of cost because of the hidden costs for which the public pays.

The ultimate purpose of Indiana doing this is to help adults earn degrees at their own pace and on their own schedule. The interesting thing will be if other states soon follow. Western Governors would seem an ideal partner because of its history, but others may get in the game as well certainly.

Another interesting aspect of the arrangement is that the startup costs for WGU were funded through grants from the Lumina Foundation for Education and the Gates Foundation. That seems like a sensible way of using grant money to spur innovation without creating a program that can’t be sustained or that distorts the market.

Michael is a co-founder and distinguished fellow at the Clayton Christensen Institute. He currently works as a principal consultant for Entangled Solutions.