202111 May
Dont use Student Credit Hours to allocate Cost!
General News

The Student Credit Hour seems to be ‘the’ go-to metric for cost allocation for financial analysis of courses and programs, unfortunately it can be horribly misleading. Costs should be allocated based on the level of effort required to teach and support the course, this means calculating the Academic Workload. The full cost is calculated based on data from multiple systems: • HR/Payroll – Who the teaching staff are, their level (professor, adjunct etc) and how much they are paid • Timetable – Which classrooms are used • Student Management – Numbers of students in each course, types of revenue Collecting, cleansing and transforming all of this data is a significant job, and connecting the dots between all of these systems is even more complex. Firstly the costs need to be allocated to where the work is undertaken – at the course level, this is where the teaching effort and student support actually occurs. This means that when looking at the allocation by Student Credit Hours we can see that it is distorting this by: As mentioned previously the Academic Workload in this example was kept purposefully simple.

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