A financial model for blended learning

I was recently involved in a training session with managers on blended learning, and the underlying issue for them was working out a sustainable financial model for this way of working.

The easy (but ineffective and ultimately expensive) approach is to simply ask teachers to develop the online learning elements in their own time, and then reward them by reducing their face to face contact time for each unit or module. This results in the teachers then teaching more units or modules in total, which means more marking (which as we all know, teachers do in their own time). Not surprisingly this method doesn’t work, but sadly it seems to be the approach that many are adopting – all that happens, is the good teachers leave to work elsewhere, and the organisation has to go through the expensive process of finding replacement staff, and the associated disruption to the team dynamics.

So the solution is to find a model that works for the students, the teachers and the organisation. This may sound like an unattainable Holy Grail, but it is possible, and  a college I supported recently used such a model in one of their HE areas which I will describe here.


The initial driver came from the students; who didn’t like travelling into college 4 days a week, and then find the lectures were often not ‘focused’, and there were big gaps between lectures. The idea was to reduce the face to face element so they only had to attend on 3 more focused days. Each lecture would be reduced in length by roughly 25% and be replaced by an online element that students do in their own time, either as preparation for the face to face element (flipped learning) or as a follow up from the face to face provision (it varied from unit to unit).


A pile of £1 coinsThe team invested money into developing this model, by actually paying the teachers a small amount to develop each of the online chunks. I forget the exact amount, but it was something like £10 per online session, and they had to develop the relevant resources/activities before they were paid. Most of the staff carried out this additional work in the summer months before the start of the next term, and they were supported by the in-house learning technologists, and myself.

First year delivery

In the first year of delivery, although the face to face time for students was reduced, the amount of teaching time allocated to the teachers remained the same, this allowed them to effectively support the online elements that they had developed – and to reflect on and improve them. This means there was no increase in the teachers marking commitments, and made the model attractive to the teachers.

Second year delivery

In the second year of delivery, the teachers allocation was reduced to more closely match the actual face to face delivery time, but they were still given a one third allocation for the online elements (e.g. for every 3 hours equivalent of online element, they were allocated 1 hour of teaching time). They also changed the pay mechanism, so the basic pay was effectively less, but the teachers were paid for marking on a per assignment basis – e.g. if a teacher has a particularly large cohort, they are paid more for marking than another teacher who has a much smaller cohort. This payment was again relatively small, but an essential part of the whole mechanism, as a long term objective of this process, was to increase the student numbers on the courses, which wouldn’t be possible if teachers are paid a flat fee for the marking.

Subsequent years delivery

Once set up and working, the model then becomes financially attractive for the organisation – even by paying the teachers to support the online elements, and changing the assignment marking element (neither of which were huge additional costs anyway) – the overall staff cost was less than before, but where the real financial gains came in, was in the courses where they were able to increase the student numbers – in some cases significantly, and easily offsetting the initial financial investment required in development and years 1 and 2.


This model worked, as it met the needs of students (who preferred this way of working, and the reduced travelling times/costs). The teachers were happy, as although their work had changed, they didn’t feel like their workload had been increased. At first some teachers were apprehensive, but they recognised that this was happening whether they like it or not, so got on board. Many of the teachers involved in the initial development, found that as well as being paid for this extra work, they actually reduced their overall preparation time that they would have done anyway. And of course the college was happy as this became a very lucrative source of revenue for the college, as well as overall raising the quality of the provision.

Key points

This worked because the college had the ability and foresight to invest sufficiently in this area. They then approached this strategically, by planning, engaging with appropriate advisers, and then following this through. The initial driver for the change, was not financial, but was about raising the quality of the product/service being offered. The financial benefits although expected were secondary, and I think helped to make more money in the longer term. Yes, the college had a model whereby they could change the pay mechanisms for the staff involved, which was essential for this project, and some colleges will say they don’t have that flexibility, but if providers want to survive in these difficult financial times, then they will have to start to do things differently, or rephrasing this – be more business-like. And finally, they picked areas that they were confident they could increase their student intake, which was essential for the longer term sustainability.

Can other providers use this model?

Simple put – yes, of course they can. Many organisations will come up with reasons why they cannot adopt this model or a similar one, but most of the ‘reasons’ will be self-imposed, and if unpicked can be resolved. The key is to identify a small number of areas to do this initially, areas where it is most likely to work, and where there is potential to increase student numbers over time (which gives the financial benefit of economy of size). Once these areas have been set up, and are into years 2,3 and onwards (and thus bringing financial benefits for the organisation) – then start to roll this out to other areas within the organisation.

A different organisation that I worked with, when implementing a similar approach, we developed a model which started with investing in a single area initially, then the next year expanding slightly, and building up bit by bit, until after 7 years, all areas would have been ‘converted’. This required an initial investment in years 1 and 2, but after that, the financial savings of the early adopters, funded the development of the other areas, and from year 4 on-wards, as well as funding the development, would also return a ‘profit’. I am aware that organisations will tell me they ‘don’t have the funds to make the initial investment’ – but this is where the strength of the organisation leadership comes in – in that strong leadership will find that investment somehow, and then commit fully to make this work, to ensure that they get a return on the investment.

I have made reference on a few occasions about the financial benefits of increasing student numbers (which gives economies of scale), obviously there is a finite number of students out there, so all organisations cannot increase their numbers in all areas. I think providers will have to carefully identify which areas they are strong in, and which areas they are weaker in. They will increase their numbers in the strong areas and reduce the numbers in the weaker areas (probably getting rid of that area of provision). Ideologically I don’t like suggesting that organisations should cull entire areas, but the sad reality is that we live in difficult financial times, where education is grossly under-funded and if we want to survive, we have no option but to make these harsh business like decisions.

Image Ref: https://pixabay.com/en/background-british-budget-business-20126/