Roland Fryer and the Root Cause of Good Management

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Roland Fryer is one of the top education researchers in the country. His research is always thought provoking and whenever we talk I learn something.

If there’s one area Roland and I may disagree on, it’s the potential for school districts to sustainably adopt the best practices of charter schools (which Roland has been instrumental in helping us understand).

This issue is of course wrapped up in the bigger question: will the greatest value of charter schools be the birth of  innovative practices or the scaling of a better governance model?

I. Roland’s New Research: MGMT Matters

Roland just came out with a fascinating study on the importance of effective principal management.

The experimental research project was set in Houston and provided principal management training (much of it borrowed from Paul Bambrick-Santoyo of Uncommon Schools) to a treatment group of school district principals.

The researchers found:

Overall, the estimates suggest that management training was effective in year one – increasing efficiency approximately 7% — but produced precisely estimated zeros in year two. Pooling the two years produces marginally significant results that fall on the other side of significance with more conservative standard errors. Management training tends to be more effective with more flexible, stable and higher human capital principals and teachers. The most robust partitions of the data are whether a principal was employed for both years of the experiment and fidelity of implementation of the management training.

In sum: they found impressive effects with talented principals who stayed in the job for two years but no effects overall due to principal turnover and too many low human capital leaders.

II. Why Did Fryer Need to Conduct an Experiment in Houston?

Data driven instruction and teacher feedback, which were key to the intervention, are not new ideas. Bambrick wrote Leveraged Leadership in 2012. And he surely wasn’t the first to implement these management practices.

So why did Fryer need to construct an experiment to apply these sound management practices in Houston?

Why wasn’t the Houston school district applying these techniques already?

As it happens, some other researchers (Nicholas Bloom, Erik Brynjolfsson, Lucia Foster, Ron Jarmin, Megha Patnaik, Itay Saporta Eksten, John Van Reenen) just published a paper on this very subject – with the aim of trying to understand the root causes of good management practices.

III. What are the Root Causes of Good Management Practices?

It’s hard to do a controlled experiment on management practices in the private sector, so caution is warranted in interpreting the results.

The authors used survey data and business results to determine whether sound management practices are correlated to increased business success (they are), and then tried to figure out what business conditions led to better management practices.

While the methodology is inherently tricky, it did reaffirm my priors.

The researchers found:

What could cause these huge differences in management practices across establishments? We found several major factors. First, establishments in more competitive industries (measured by the Lerner index) adopt more structured management practices. Second, those in more pro-business states (proxied by states with ‘right to work’ laws, as in Holmes 1998) tend to use more structured management practices. Third, establishments with more college graduates and firms located near universities (building on the work of Moretti 2004 for identification) tended to adopt more structured management practices. Fourth, being located near a successful large new entrant (using the ‘million dollar plants’ identification strategy of Greenstone et al. 2010) is correlated with more structured management practices, likely because it allows local companies to learn about practices from these large, successful firms.

All these factors matter, but they explained less than half of the variation in management techniques, which means that many other factors matter, too. One hypothesis is that individual managers and CEOs themselves are another critical driver (e.g. Bandiera et al. 2017).

To summarize: good management practices were most often found in (1) competitive industries (2) with less restrictive labor laws (3) located near universities and (4) successful new start-ups.

I know a city educational system that meets all these conditions.

It happened to achieve some of the best student achievement results the country has recently seen.

IV. Yes And

It if it ever occurs, it will take a few decades to scale the charter sector serve the vast majority of low-income students.

For this reason, I appreciate Roland’s efforts to see if charter practices can increase achievement in districts. While I don’t think this is the long-term game, there might be short-term benefits to be had.

But if you want these achievement gains to be sustained, you have to address root causes.

And the root cause of good management is not really about intellectually understanding good management practices.

Rather, it’s about creating the enabling conditions to sustainably execute these management practices.

I believe that non-profit governance will prove to be one of the most important enabling conditions in the public education sector.

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