Fethke: Business schools more driven by market, demand

IOWA CITY -- Business schools have done a better job adapting to the needs and demands of a changing higher education market than other areas of public universities, a former dean of the University of Iowa Tippie College of Business said.

Business schools are more responsive to the courses students want, and to the advantages of selecting the right students, advising them and helping them with career placement, argues Gary Fethke, who retires at the end of this semester after nearly 40 years on the UI faculty and stints as the Tippie College dean and interim president of the university.

"You have to spend an awful lot of time on outside the classroom activities to make this work," Fethke, 70, said. "And I think business schools have done a better job of that than other places."

Paying attention to the marketplace and external forces -- and the competition -- will be increasingly important for public higher education as state funding levels continue to make up less and less of university budgets, Fethke said. The Sioux City native co-authored a new book, "Public No More," which looks at the funding model of public higher education and offers alternatives.

"If you are totally dependent on subsidies, I think it breeds a kind of contentment and sluggishness," he said. "You don't have the luxury of having that if you're not subsidized."

As an economist, Fethke said he believes competition is a good thing because it disciplines people and encourages innovation. It can do the same for higher education, he said.

"Public No More," published in April by Stanf0rd University Press, argues that to succeed, public universities need  streamlined governance structures, a condensed scope, a more entrepreneurial approach and a reduced sense of dependency and entitlement. Top research universities have the potential to survive even with continued erosion of state funding, but that means paying more attention to what the market wants and being more selective in the programs offered, Fethke said.

"It's hard to justify subsidizing a program where there's nobody willing to pay," he said.

Fethke and his coauthor argue in the book there should be more variable tuition for programs, depending on the actual costs and the demand by students.

"We now have a situation where price doesn't reflect cost and so you have people making choices who aren't having to pay the consequences of those choices," he said.

It would also make sense for each of Iowa's three public universities to have a separate governing board with expertise representative of each school, rather than one Board of Regents, Fethke argues. That would allow the decision making, including pricing, to reflect the mission, strategy and strengths of each university, he said.

Higher education funding is an area about which Fethke expects to continue writing and lecturing after his retirement from the UI. He expects to keep busy because retirement, Fethke said, is an odd word for someone who has worked full time since he was 19 years old.

Fethke came to the UI as an undergraduate student in 1961. He earned his bachelor's and doctoral degrees from the UI and with the exception of six years spent teaching at Bradley University, Fethke has spent his career at the UI. He was interim dean and then dean of  the Tippie College of Business from 1993 to 2006, and served as interim president of the university for more than a year in 2006 and 2007 during a time of some tumult for the UI and a search that led to the eventual hiring of current President Sally Mason.

"It's never been difficult for me to leave things. I'm not overly nostalgic about leaving a position even though I liked it," Fethke said. "It's not a period of nostalgia, it's a period of searching out what I want to do next."