The Economics of Online Professional Education – Exploring the Delta between Design, Delivery, and Demand


Association leaders are looking for methods to extend reach, and to attract and retain new members. Many membership associations consider education to be a core mission of the organization because they provide certification and continuing professional education to members. These programs are a major source of non-dues revenue, and moving to online learning seems like a logical step to create growth and sustainability. However, unlike universities which also provide education for revenue, associations do not enjoy the economies of scale, and many lack resources required to invest in quality online programs. The focus of this research is to determine the actual cost of developing various types of online learning programs and to assess the value of each as determined by industry pricing and perceptions of association members. In order to achieve these goals, content for an online course will be developed from the results of the current study “Exploring Critical Success Factors of eLearning Program Development in Associations”. Using the data gathered from the qualitative portion of the study, curriculum will be developed for a course entitled “How to Launch a Successful eLearning Program”. Using activity cost accounting methods, each step of the process will be tracked including the development of the curriculum as a “build from scratch” project. When disparate skills are involved, time will be tracked to account for this variation in skill sets. The course curriculum will be presented in three formats a) an on-demand, “point-and-click” course, b) a live webinar series and c) a facilitated online course. The time required to facilitate the courses will also be tracked. The relative value of each eLearning program will be determined by learner assessments and perceptions, and by the price of similar programs available through associations. The outcome of the study will be a cost-benefit analysis of the various types of eLearning offerings typically found among associations who offer continuing professional education. The results of the study will be disseminated through the association community through a partnership with the American Society of Association Executives (ASAE), and through scholarly publication.


Research Design

Understanding the direct costs associated with course development starts with curriculum that can be adapted for online learning. The curriculum for the course “How to Launch a Successful eLearning Program” will be derived from the current study on critical success factors of eLearning program implementations. Therefore, the time to create the content from study results will also be tracked. Each component part of the course itself is built as a “learning asset” that together will create courses of various types, using the same curriculum. Not all learning assets will be used for each of the three course designs, so the labor to build each asset will be logged individually and according to the skills required.

Each of the three course designs (webinar, fully on-demand, and online instructor-led) have different elements that are unique so each of these learning activities will be accounted for separately in the time tracking program. Additionally, course delivery and administration skills are different for various types of courses, to these costs will be captured in separate cost centers. Garbett (2012) created a cost-collection model for eLearning, and this methodology will be used in my study. The following is taken from his article on activity-based costing models for online learning and is adapted for professional development programs. In general, each course style will include the following types of costs collection activities:

Total Cost is the sum of Fixed Costs plus Variable Costs plus Semi Variable Costs. (TC = FC + VC*N) In the following cost calculations:

Fixed Costs include, for example, costs associated with administering certificate programs. These fixed costs are in place no matter the number of learners. These costs are similar for traditional face-to-face delivery and online delivery.

Variable Costs include items such as assessment that fluctuate with the number of registrations in the program. Clearly, the total time spent on assessing students’ work varies with the number of learners.

Semi Variable Costs arise with various course activities and are specific to the type of course under development.

Activity-Based Cost Tracking

To fulfill the requirements of tracking all activities, the program “Bill4Time” will be used. The time management and billing software is designed to track various types of activities and associated skill levels. In the fully on-demand courses, there will be video components (for example) and video production is a skill set that must be tracked separately from course facilitation.

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