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Submitted on behalf of Administrative Council, Discussion Table 19
Brainstorm question - What costs does MIT guarantee and what do we cut when faced with hard choices?

We began by posing several other questions related to the question we were assigned.

We decided that instead of thinking about what to cut, we would focus on how to get more resources. This led us to question what role do we want corporations to play? Do we want to consider creating and extension program where professionals can be sponsored by their employers for continuing education (presumably at a higher return for MIT)?

It was suggested that we could think about increasing the quality of learning while keeping costs the same OR keep quality constant but with lower costs.

Since such a large part of the cost of an MIT education is faculty salaries, for MIT this may not be a cost saving effort, but rather a quality enhancing effort that would allow us to seek other revenue opportunities beyond traditional tuition and philanthropic gifts.

We all agreed that MIT should not cut the size of the faculty because even the online courses will need refreshing over time and without the faculty to do the refreshing the online component of an MIT education would deteriorate over time.

It also was noted that research and education at MIT are inextricably intertwined, so retaining the faculty who do the research is essential to retaining the character of an MIT education.

We then discussed the possibility of licensing the online courses to other universities in search of high quality course content. (SPOT Licensing) Experiments in this space are already underway.

The final idea we discussed was the possibility of having students do one year of their MIT education online and only spend 3 years on campus. This would allow undergraduate classes to grow to 1,500 students each (since the campus can accommodate 4,500 total undergraduates) rather than undergraduate classes of 1,125 (an increase of 1/3 over four years). This would generate more tuition revenue as well as create more alumni more quickly, which should generate increased philanthropy over the long term. It would also allow larger lecture spaces on campus to be repurposed and presumably save on other associated overhead costs (such as heating and cooling, electricity, etc).

We also had a side discussion for part of the time about how teaching blended classes (online lectures with hands on face to face time with faculty, TAs and fellow students) is less of a drain on faculty in preparation time. It was estimated to be about 30% of a faculty member’s time rather than 50% time currently budgeted, so the other 20% time could be redirected to executive education at higher returns than traditional undergraduate face to face teaching.

A New Financial Model, Revenue opportunities