Where continuing education is an appendage of the university, it is hard for it to become an overnight financial success. The general exceptions to this scenario are institutions or corporations set up specifically to manage a new model. Two obvious examples are the British Open University, opened 30 years ago to provide access to a quality British education to working Britons, and the venture-funded University of Phoenix.

The message is clear. It is the same message that the rest of the economy learned about the Internet. Online learning is worthwhile, but the miracle is not going to occur for any one institution by itself without a workable niche product, marketing know-how and dollars, or a captive audience. The financially successful non-profit operations have niche product, and their strategies revolve around maintaining a corporate-like model in which everything is driven from a business plan and process that focuses on marketing to potentially captive markets, such as working professionals or audiences with specific corporate-driven education needs.

While the typical continuing education operation serves working professionals, recreational learners, and increasingly more traditional on-campus students, the constraints continue to be the same. In short, many continuing education operations are regionally constrained and lack real business planning with financial, market, customer, competition and alliance analysis.

There are three fundamental barriers to pierce: the right supply, the right demand, and the right structure. In the case of distance education, the market is not organized. Supply and demand are not aligned, and the market has not formed as some predicted. In this down economy, when the unemployed should be returning for courses and degrees, the actual buying habits do not support the counter-cyclical theory of demand. Finally, owing to university governance and caution, money is not being spent to plan and strategize like a business.

To operate a university division as a business that can develop market-driven supply, develop effective marketing strategies and possibly align with the for-profit corporate world is foreign to most academic cultures. Moreover, modern corporations and academia are so inherently different from each other that they ultimately clash. Regardless, it seems inevitable that the future of the knowledge society requires that both pair together and share relative strengths. The value of the non-profit is that it’s in business to create the highest quality education, research and service. It competes on quality to select niches and is reputation-driven. The corporation must strive toward efficiency, the selling of the greatest number of units developed at the lowest cost to the greatest number of customers at the highest price the market will accept. It competes on returns and is market- driven. Combine the two and you should have the basis for high quality education sold in the most efficient manner with the highest return.

During the dot-com heyday, some universities answered this call by spinning out their own for-profit entities. They soon found out, however, that this model would not work. These new for-profit entities did not have enough product or enough reputation to get market-share. Other universities hired marketing entities but, again, lacked volume.

Other attempts, historically, to acquire product volume included the formation of university consortia, banning together to market and provide their products. Some of these have also failed because of the overabundance of conflicting university politics and attitudes.

What has not happened, however, is a combination of strengths, where volume can meet reputation and product can be delivered efficiently. There are only a few cases of success here because of political, legal, tax-code-related barriers and, frankly, a lack of creativity.

In the meantime, the for-profit universities are ramping up enrollments quicker than anyone thought possible. These institutions can mandate out the politics and look at efficient product creation and delivery. Like a successful corporation, they are quick and nimble when it comes to creating product to meet market demand. Additionally, they have been able to increasingly develop top-notch student services based on historically successful customer-service-oriented business models. Moreover, and perhaps most importantly, they have substantial marketing and advertising dollars.

Where does this leave continuing education? It leaves the universities in search of a way to find the right amount of product to effectively market and distribute in a way that contains business efficiencies. Ultimately, this can happen. Administrations, at the top, (President, Provost, CFO, CIO, Continuing Education Dean) must decide it is a mission priority and participate in its creation.

There simply is not enough business today for hundreds of universities to play on their own. Continual growth and funding are not givens. Thus, the modern knowledge society will require partnerships between multiple universities and real business elements, pre-tested for an ability to collaborate and a willingness to give up a certain amount of control to get the right quality offerings developed and marketed.