Sharpening Our Vision:
Exploration of the AAA's Possible Future Roles
AAA Annual MeetingMonday, August 5, 2013
Anaheim CA
Thanks to the Broad Participation
• Mike Diamond – past president and volunteer leader• The Board• Council• Task Forces
Agenda• Our path
– Overview of the changes facing higher education– Overview of our process– Insights from Council– The time is right: One-Time Opportunities
• The journey: Task force reports• Where we are – and where we’re going• Feedback? Questions? Insights?
Overview
Mike DiamondPast President of the AAA
University of Southern California
Why are we’re doing this?
Two key elements as relates to higher education
– Technology– Business model disruption
The challenge: a rapidly changing educational environment ripe for
“disruptive innovation”
Technological Forces
“Technology is doing to education what it’s done to countless other industries: disrupting it.”-- Victor Hu, Goldman Sachs
Stanford U. President John Hennessy on online
education: “There’s a tsunami coming.”
…a Technology is changing the way our students learn…and courses are delivered
Bain/Sterling white paper conclusion
“Higher education in the United States is at a tipping point. In its time of need, the leaders of our colleges and universities have a tremendous opportunity to reshape and reinvent an industry…”– The Financially Sustainable University, July 2012
Source: www.thesustainableuniversity.com
Business Model Disruption
Christensen, et al Disrupting College (simplified)
VALUE PROPOSITION
PROCESSESPROFIT FORMULA
RESOURCES
From Society’s Perspective
Their Tuition The Value of their Degrees
From the University’s Perspective:Their profit model
Their Costs
Tuition IncomePublic Funding
+ +><
Headline: July 23, 2012 US Higher Education at ‘Tipping Point’ with One-Third of Schools Financially Unstable
“The data is clear: A growing percentage [currently about 1/3] of our colleges and universities are in real financial trouble.”– The Financially Sustainable University, July
2012 Source: www.thesustainableuniversity.com
Reducing University Costs?
• Inefficiency is part of it – but not all– Economies of scale?– Increasing volume?
• To manage means reducing complexity
• Changing the model means changing the value proposition– MOOCs, for example
Source: Adapted from work by Lloyd Armstrong, presented to Council, Nov 2012
Raising Tuition?
• Increasing the real price decreases access
• Decreasing access reduces opportunity – bad for society
• Increasing the real price is causing rapid growth in student loans
• We are in trouble with tuition!
Source: Adapted from work by Lloyd Armstrong, presented to Council, Nov 2012
VALUE PROPOSITION: CHALLENGE FOR HIGHER EDUCATION
• We’re facing complaints• Growing demand for
demonstrable outcomes– Government spending scrutiny– Students and families concerns with
increasing tuition• We must increase value
– What we teach: Move beyond algorithms
– How we teach: Use emerging, proven techniques
Source: Adapted from work by Lloyd Armstrong, presented to Council, Nov 2012
INNOVATION IN PROCESSES
• Competency-based education– Defined by panels of experts– When you display the
competency, you earn the credit– Changes time to degree– Enables transfers, comparisons– Western Governors University– Bologna Process
Source: Adapted from work by Lloyd Armstrong, presented to Council, Nov 2012Photo by EarthLED and used under the Creative Commons license. Photo is available here:http://www.flickr.com/photos/62324368@N06/5927652703/sizes/z/in/photolist-a2NLCF-9FUj2C-9FUu6f-9FRkyB-9FUxfu-9FRxZc-dDYcwN-9YGXqC-9YGYSA-9YGXAj-9YE5ix-9YGXjY-9YE3Ye-9YE3TP-9YGY9w-9YE4yr-9YGYGE-9YGYdG-9YGXRS-9YGY4m-9YGYuq-9YGX7w-9YE54x-9YGXZf-9FVhV9-9FRnEx-9FUAfj-9FUwjf-9FRDTP-9FV3G7-agwPPw-9FSnS4-9FUrpL-9FRqei-9FUKfq-9FUQtW-9FRG2H-bMhmjx-bynDeN-bynE8b-9LDaw1-99jY9H-agwPPs-w1PKK-8HFjm6-9FRR2P-9aCWV1-4Uqv85-5K827n-5qxWLQ-c55YEj/
BUSINESS MODEL DISRUPTORS
• NUMEROUS POTENTIAL NEW “UNIVERSITIES”– MOOCS
• Available everywhere• Low cost, quality courses “taught” by
famous faculty• A huge disruptor
– Corporate universities– Publishers and media companies– Companies and foundations using open
source materialsSource: Adapted from work by Lloyd Armstrong, presented to Council, Nov 2012Photo by EarthLED and used under the Creative Commons license. Photo is available here:http://www.flickr.com/photos/62324368@N06/5927652703/sizes/z/in/photolist-a2NLCF-9FUj2C-9FUu6f-9FRkyB-9FUxfu-9FRxZc-dDYcwN-9YGXqC-9YGYSA-9YGXAj-9YE5ix-9YGXjY-9YE3Ye-9YE3TP-9YGY9w-9YE4yr-9YGYGE-9YGYdG-9YGXRS-9YGY4m-9YGYuq-9YGX7w-9YE54x-9YGXZf-9FVhV9-9FRnEx-9FUAfj-9FUwjf-9FRDTP-9FV3G7-agwPPw-9FSnS4-9FUrpL-9FRqei-9FUKfq-9FUQtW-9FRG2H-bMhmjx-bynDeN-bynE8b-9LDaw1-99jY9H-agwPPs-w1PKK-8HFjm6-9FRR2P-9aCWV1-4Uqv85-5K827n-5qxWLQ-c55YEj/
BUSINESS MODEL DISRUPTORS
• Accreditation makes entry difficult – for now
• Lack of some input requirements• Competency-based outcomes OK
now for accreditation• Likely to be more institutions
accredited on outcomes soon – offering essentially free degrees
Source: Adapted from work by Lloyd Armstrong, presented to Council, Nov 2012Photo by EarthLED and used under the Creative Commons license. Photo is available here:http://www.flickr.com/photos/62324368@N06/5927652703/sizes/z/in/photolist-a2NLCF-9FUj2C-9FUu6f-9FRkyB-9FUxfu-9FRxZc-dDYcwN-9YGXqC-9YGYSA-9YGXAj-9YE5ix-9YGXjY-9YE3Ye-9YE3TP-9YGY9w-9YE4yr-9YGYGE-9YGYdG-9YGXRS-9YGY4m-9YGYuq-9YGX7w-9YE54x-9YGXZf-9FVhV9-9FRnEx-9FUAfj-9FUwjf-9FRDTP-9FV3G7-agwPPw-9FSnS4-9FUrpL-9FRqei-9FUKfq-9FUQtW-9FRG2H-bMhmjx-bynDeN-bynE8b-9LDaw1-99jY9H-agwPPs-w1PKK-8HFjm6-9FRR2P-9aCWV1-4Uqv85-5K827n-5qxWLQ-c55YEj/
CONCLUSIONS
• The business model is changing• Change will not effect all institutions equally• Professional associations that represent those
institutions, their faculties, and their graduates will need to move in ways that reflect that evolution
Source: Adapted from work by Lloyd Armstrong, presented to Council, Nov 2012
Why are we doing it now?
• Higher education in the midst of disruptive innovation
• AAA-specific opportunities– Board commitment– New council structure– One time financial opportunity– Commitment to fulfill our mission “To further
the discipline and profession of accounting through education, research and service.”
How are we doing it?
Our Mission: reevaluated – and we recommitted to it!
Our timeline: Major events in 2012-2013
Nov 2012
– Council Kick
off
January 6, 2013 – Task Force
Meeting
March 16 – Council meeting: received input from Council on
top suggested initiatives
April 17 - Council Webinar Meeting:
Follow up
May 15 -
Initiatives
Refined
May 21-23 – Board
Strategic Retreat
August 5 –
Panel session at the Annual Meeting
November –
Finalized project,
approved by the Board
With many, many conference calls and work sessions!
Insights from Council
Pat PoliChair of Council, AAA
Fairfield University
The time is right - Insights from the Finance Committee
Steve MoehrleVP of Finance - Elect, AAA
University of Missouri – St. Louis
Thanks to strategic decisions and a great community…
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CIIA
JETA
JLTR
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API
JMAR
BRIA
JIS
JATA
AJPT
Horizons
Issues
TAR
Journals and pages published by the AAA
pagesjo
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als
When we faced challenges… we found opportunities• IPTF 1: Recognized the strategic role of “expanding knowledge”• IPTF 2: Recognized the strategic importance of our capabilities to
manage partners• The AAA successfully negotiated with EBSCO
• So we have a (likely) one-time opportunity to increase revenues– Continue operations– Protect a conservative “rainy day” fund– Make strategic investments to insure a strong future, even if publications
change radically
How should we think about the publications revenues?
Uses of Publications Revenues
Current Model"Rainy Day""Rainy Day"
• Revenues used to fund our current model– Approximately $2MM
historically built into the budget
– Budgets usually targeted to be net neutral
– Require these funds to continue with the current business model
Presented at the Finance Committee budget meeting,February, 2013
How to think about the additional revenues?
Uses of Publications Revenues
Current Model"Rainy Day"In-vest-ment
• We are in a time that is – Exciting
• New models• New types of IP• New audiences
– Unpredictable• Range of revenue models
• Thoughtful balancing of– Investments for the future– Preparation for a potential
“Rainy day”
??
Presented at the Finance Committee budget meeting,February, 2013
Recommendations for 2013-14• Support a task force to explore
organizational/structural alternatives– Focus on capabilities needed to be
• Member value producing• Agile• Efficient• Strategic• Sustainable
– Recognized this would likely require• Professional support• Face-to-face meetings
– Budgeted for the task force
The journey –Task force reports
Expanding Knowledge and Idea Development
Steve KaplanCouncil Representative, AAA
Arizona State University
Our Task Force Members• Christine Botoson, University of Utah, Co-Chair, • Steve Kaplan, Arizona State University, Co-Chair,• Bonnie Klamm, North Dakota State University, • Ranjani Krishnan, Michigan State University, • Elaine Mauldin, University of Missouri – Columbia, and • Steve Sutton, University of Central Florida
Our Timeline
Informing and Influencing Policy & Practice
Hughlene BurtonChair-elect of Council, AAA
University of North Carolina at Charlotte
MODEL: Span of Influence
National
Global
AAA
Public AccountingBig 4
Regional FirmsSmaller Firms
University AdministratorsDeans
ProvostsPresidents
RegulatorsFASBGASBIASB
NASBAState Societies
Corporate AccountingIMA
Controllers, CFO’s
Faculty Members
Practice Members
Department Memberships?
Other StakeholdersSoftware firms
Advisory Services
Overview of BIG Idea
• Develop a AAA Center for Education, Research and Thought Leadership– Sponsor joint conferences between AAA sections and practitioner and
policy making groups
BIG IDEA – Develop aAAA Center for Education, Research and Thought
Leadership
• Value Proposition– Currently there is no single place for someone from
practice or policy makers or for AAA members to find information relating to academic research or educational materials. This center would promote many of the ideas provided by the individual groups inside the AAA. By establishing a center to birth, nurture and house the ideas, the center can begin from a modest base and grow in whatever direction the challenge that lie ahead direct us.
BIG IDEA – AAA Center for Education, Research and Thought Leadership
• Some examples of things this Center could do– Joint Conferences with Practice and Policy
Makers– Repository of Online Educational Resources
(OER) –– Think Tank focused on practice / professional
challenges– BIG DATA and Qualitative Analysis
Promote Joint Conferences
• Value Proposition– Currently there are few opportunities for faculty
and practicing accountants to interact. As a result, there are concerns that our research isn’t relevant because faculty don’t know enough about current issues in practice; and practicing accountants don’t have access to (or visibility of) current research to inform their efforts.
Promote Joint Conferences
• Benefits– This would allow AAA members to partner with practice to do
research and hold discussions that would be a benefit to both policy and practice. This is also a way that we could partner with practice globally as well. Many of the practice and policy organizations are global/international. We could have different themes for these conferences. Also could partner with some of our AAA section journals to have publication outlets for some of the papers/research from these conferences that could be disseminated to a wider audience than can attend the conferences. This would also help with one of our other proposals to focus more academic research on relevant practical issues for policy and practice.
– Suggestion for first conference – BIG DATA
BIG DATA and Qualitative Analysis
• Value Proposition– This is one of the biggest problems facing the
accounting profession today. Society faces problems with accounting for health care, federal budgets, etc. Many of these problems relate to BIG DATA and how to analyze these large and cumbersome systems. This would be a great place for the AAA to get involved in some important societal questions and make an impact on practice and policy makers.
Repository of Online Educational Resources
• Value Proposition– These would be short topical video segments
available to AAA/Practice for use in class or by practitioners in their training. Created from practice and educational point of view. Could have global reach to many users. Free for AAA members, with some cost to others.
Promoting Effective LearningandAdvancing Faculty Careers
Julie Smith DavidChief Innovation Officer, AAA
Promoting Effective Learning
Reward and
celebrate
accomplish-
ments
Doctoral student
New faculty
Newly tenured
Senior scholar
Close to
retiring
Emeritus
Acknowledge a wide range of contributions
Help faculty learn about
future capabilities
Support
faculty
through
career
services
Realize faculty growth at all stages
#2 Educating the MembershipKnowledge is Power!
sample rec’s
• Accounting Faculty of the Future Panels – Annual meeting– Midyear and regional
meetings
• Centers for Research Databases and/or Centers for Faculty Development and Teaching Excellence
• Member/institutional empowerment
Where we are – and where we’re headed
Julie Smith DavidChief Innovation Officer, AAA
Reflections on SoV!
concentrated voice
policy recommendations
“Go To” organization
balanced member:staff roles
efficiency
impact
sustainability
continuity
integration
external engagement
value to members, segments, andthe accounting academy as a whole
two-way communications with external entities
increasing the size of the pie
decentralization overload
faculty development
leverage
sharing
leaders
reimagining our core
concerned with practice
research
teaching
How to flesh out the idea?• Develop the initiatives from the SoV
recommendations• Professional assistance• Engage our members
– sharpeningourvision.com – Section and region meetings– Webinars– Accounting Education News updates
• Establish two new task forces
Continuing through
A. Strategic Initiatives Task Force– Focus on strategic
initiatives • Especially “Big Ideas”• Potentially creating a
“Center” (or some other new structure for new initiatives)
– Chair: Christine Botosan (AAA president-elect)
– Staff Liaison: Julie Smith David
– Seek professional assistance
B. Strategic Organization Task Force – Recognized by the Finance
Committee and Board– Focus on changes to enable
transformation• Eliminate roadblocks• Work with segments
– Examples• Make all journals
available to members• Webinars
– Chair: Stacy Kovar (former VP Finance)
– Staff Liaison: Dave Frazier (Interim CFO)
SoV Task Force: Chaired by Karen Pincus (Past President)
Feedback?
Questions?
Mike DiamondPast President of the AAA
University of Southern California
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