Module 4: VII.) The Blended Learning Budget

So this topic that we're about to dive in on is really important. It's about the budget, basically. How are we going to pay for this innovation? How do we afford it? How much is it going to cost? It's really important to think through these questions.

And Michael, I think you agree with me that we have a bias in this area, that we think you need to think about these changes in a scalable way. In other words, you can't just go out and raise X amount more on top of your existing budget to pay for blended and instead you have to really think about the structural changes that you will make in your school to make this sort of cost neutral. So that we know this is hard, we know it's not easy to make changes, but we think it's a really important concept to hold onto so that these changes can be sustained over time.

So our objective in this video is to give you a sense for the potential for costs and savings as you move to a blended learning model. And we've given you some tools to actually create a rudimentary budget for how these savings and costs work in these blended learning models. And the big idea here is that we'll actually start just by modeling this out within an individual classroom and then we'll move to actually seeing how blended learning cost and savings play out at a school wide level.

Now, budgeting is complex and it varies depending on the setting you're in. Different state funding rates, different district regulations. This little module is not going to give you everything you need to be a master of the budget. But we think it is important to play with some real trade offs. And so we've created some spreadsheets and we're going to walk you through some examples that to make this more real for you so you understand the trade offs of budgeting.

Now, we want to say this up front, which is that blended learning is not something you should dive into for cost savings reasons. Blended learning is not a cost savings tool. It's a learning tool to bolster student outcomes for every single student.

So we come to this because we believe blended learning is right for learning and the cost savings make it sustainable. Now, if you know budgeting, if you're a whiz on Excel and you've done a lot of sort of classroom and district and school level budgets, you can skip this module. We're not going to give you a proficiency test. Just take a look at the examples we have in the spreadsheets and if you feel very comfortable with them, skip the content and go and start Working on your final budget process. If not, what we're hoping to do is make this kind of tangible and real. As we look at some real examples, many of you may be thinking about how to do blended learning in a single classroom setting. So we're going to start there. And in this situation, if we assume one classroom with one teacher, there's really three variables to think about. The hardware, the software and the infrastructure.

So as we think about the hardware, the key decisions are how many computers do we need and what type are we going to actually purchase. As we think about software solutions, then that actually starts to leverage off of what decisions we've made on the hardware. But do we need core content, supplemental and so forth. And then infrastructure is really critical. A lot of schools forget about this, which is basically the decisions around how do we actually have the right charging stations within the classroom and if we set up the right headphone infrastructures, wireless, broadband and so forth.

Now, where you end up on the cost side of things for hardware and software and infrastructure does depend on the kind of model you have. If you're going to be a flex model and students are allowed to go at their own pace whenever they're ready for it, they probably need one to one. And if you're doing a station rotation with three stations, you can probably divide your class size by three and by that many number of hardware devices, and you'll probably still need software for every student.

That's right, Brian. And there's a second consideration as well, which is that you have to think about up front costs versus ongoing costs. So upfront costs might be that money that you put forth to buy the hardware initially. But then you got to think about what's the replacement cycle and how often are we going to have to buy new devices. Similarly, with software you might take a free solution, but if you have online software, you might actually have annual licensing costs.

So that's the cost side of the equation. Let's look at the other side of the equation. The potential revenue or cost savings that you could come up with. Now I understand you may not have full control over this. If you add a student to the class, you may not be able to capture that revenue. But it's important to think about this in designing your principals that you're trying to get the cost and the revenue to balance each other out. We're going to have two big important ideas in mind when we look at the cost savings or the potential revenue. The first is to increase the number of students in a classroom. And we know that Every teacher may not capture these savings, but schools can. And they should be thinking about the trade offs between increasing class size and, and the kind of new blended learning models that might be possible. A colleague of mine actually said this really brilliantly. He was looking at a school in which he's on the board and said we average a 27 to 1 class size. So the question isn't how much more we should spend to do blended. We should be talking about the trade offs. If we go to 28 to 1, we have about $7,000 of revenue for that school, and that's going to allow us to have some technology. If we go to 29 to 1, we'll have $14,000 more for that classroom. And that's going to allow us to have all the hardware and software we want. So the right question to ask is actually, can we do more with 29 to 1 and all the tech we want for a new model or 27 to one and none? And if you think about that trade off, you're actually evaluating the choices. Well, the second area that you might be able to save some funding on is instructional materials. As we move to more and more things that are online, open source classrooms, open source textbooks, we don't necessarily have to spend as much as we used to on textbooks or even photocopying, which adds up as a school level. So you need to think about both the cost savings from less instructional materials and then the additional revenue if you can add any students to the model.

So I know, Brian, it's actually really helpful for me to actually have an example in front of me to think through how this actually works. So let's assume that we're actually going to implement a blended learning station rotation model in an elementary school classroom. So if you go to the resources section right now, there's actually a template there where you can actually see the costs and savings of implementing, implementing such a blended learning model. Now, it oversimplifies things just a little bit, but it's really helpful, I find, for thinking through the trade offs that you're going to have to make when you're implementing one of these things on a budget.

Right. So let's start with the hardware in this model. We're going to have a computer for every three students and we're going to use Chromebooks at $250 a piece. And then we'll buy one or two extra computers for when something's broken or when a computer is in charge. We have that Flex built into the budget.

So if we move to Software, let's assume that we're going to be able to pay roughly $10 per student. Now, that's not a lot of money, but remember, this is for one subject and one class. Now, for simplicity's sake, let's assume that the room is already set up for adequate wireless and we figured out how to charge the computer so there are no infrastructure costs.

So that covers the cost side of things with the hardware, software and infrastructure. Now let's think about the revenue and savings side of the model. This is a California school that's made a decision to increase class size by one student from 28 to 29 to try to create some extra savings to put towards this new model. And in California, we assume about $7,000 per student. In addition, they decided with all this technology that they were going to shave about $5 per student off the textbook or instructional materials budget, so they get some additional revenue and some cost savings.

So now that we've walked all through this, what does this actually look like from an overall cost and savings perspective? So, hardware and Software combined are $3,290 in upfront costs.

And on the upfront savings, they're going to generate $7,145 from the additional student and from the savings on instructional materials.

So in the first year, theoretically, the costs, that $3,290 figure could be covered by the savings, which were $7,145.

And the big picture actually gets even better when you look out into subsequent years. You would have $1,207 in ongoing costs replacing the hardware, the software licenses, but you'd still have that $7,145 in savings or revenue. So you actually would be generating $5,900 per year that could be used to increase the student experience and learning in different ways. So this is just one example, but hopefully it helps people see that this is not something that's totally out of reach. We don't all have to go out and raise massive amounts of money before we can think about blended learning. We do have to think creatively though, about the trade offs and the costs and revenue side of this process.

So let's turn our attention now to the school wide level. As we think about the school level, we actually have a lot of the same levers at our disposal as we did in a classroom level for the cost and savings. But we have one certainly additional input, which is to start thinking about staffing. Now, we recognize you may not have control over all these factors, and sometimes these issues are Tricky, or you may not actually agree with a certain decision, but it's still an exercise that's worth thinking through.

So as you think at the whole school level, think about these key hardware, software, infrastructure, instructional materials, space and furniture, staffing.

So we've talked about the hardware, the software, the infrastructure and the instructional materials. Basically, when we move to a school wide level, it's the same levers, but just a larger frame on it. Now, as we start to think about furniture and things of that nature inside of the space, we'll actually dive into that deeper next week by introducing some hacks that you can use to get the great space that you want for your model without spending a lot of money.

So let's look at the steps and the big ideas. Here are how many staff with how many students and what they're paid.

So let's actually look at an example of an elementary school that's implementing a lab rotation model that has 540 students.

This school has an iPad lab and a lab with desktops. So they have 45 iPads and 45 desktops. And their software licensing costs are about $40 per student.

So that covers some of the more straightforward costs. Let's turn our attention to the staffing model. With 540 students, they would typically have 22 to 24 teachers. But in this model, because they have paraprofessionals staffing the Labs, they have 15 core credentialed teachers and seven paraprofessionals. So the same amount of adults in the school, but two different types. Because of this, they also are able to pay their teachers $10,000 more.

So let's look at the number of students they have in this school and the kind of facilities and space that they use.

So this school decided to keep their classrooms at the same student to teacher ratio, so they had no additional costs or savings on either side there. They also decided to keep pretty traditional classrooms, so they didn't actually have any facilities costs in a transition there.

When you put all this together, the results are actually pretty interesting and compelling. They have $67,000 in up front hardware and software costs. But on the flip side, by changing their staffing model, they've actually created $100,000 of savings compared to what a traditional model would do. So overall, even in their first year with all their upfront costs, they generated $33,000 in net savings. And in ongoing years they free up $66,000 to invest into different places in their school. So hopefully these examples give you a better feel for how the budget actually works when you're thinking about blended learning. And remember, it's not about just raising a bunch of money. It's about making the structural changes that allow you to do blended the way you want to but actually afford it within your existing resources.

Yeah, that's exactly right. And as we've talked previously, realistically most of the costs in the school model are in the people. So rethinking how we use staffing structures and classrooms in innovative ways actually may be a critical tool in your arsenal to make your blended learning model both sustainable and scalable.

And lastly, we do talk about budget because it's important. But remember, we're not at blended learning as a concept for the cost savings. We think you have to do it responsibly and we think you have to find the savings within your schools. But this is really about better outcomes for students and we're just trying to help you think about how you can afford to do it within your existing model.