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BL RETURNS AND INVESTMENTS
24,2
A more robust view of the
revenue stream: are students a
118
tool for corporate finance?
Accepted May 2011 Terry Cottrell
University of St Francis, Joliet, Illinois, USA
Abstract
Purpose – The purpose of this paper is to explore the viewpoint that college students serve the same
function as customers purchasing products from corporations.
Design/methodology/approach – This paper gives comparisons and differences between the
process of students learning through higher education and the process of customers buying a
consumer good.
Findings – This paper recommends that while similarities exist between students and consumers, a
more robust view should be maintained and communicated as a means of preserving the true nature of
the academic enterprise above and beyond simple consumer activity.
Originality/value – This paper presents a clear acknowledgment that while all students consume
knowledge, they are also all held to the expectation to return new knowledge. This reciprocity is not
part of the ordinary consumer interchange.
Keywords Customers, Students, Colleges, Libraries, Finance, Product
Paper type Viewpoint
Students at enrollment-driven institutions are not only the fuel for growth, but also
survival. There is no large endowment on which institutions such as these can rely
during registration or fundraising shortfalls. Student enrollment must always remain a
priority until an endowment suitable to maintain existing operations can be built from
years of tuition dollar savings. Many major corporations carry large sums of cash, in a
manner similar to university endowments, as a means to mediate times between failed
product launches and major strategic changes. Even large companies like Microsoft
have utilized large cash reserves to restructure during revenue shortfall periods. After
years of winning the consumer software wars with their popular Windows and Office
products, Microsoft all of a sudden found itself in need of new strategic direction in the
wake of Apple’s rise to rise to dominance (Tweeny, 2010). Company cash reserves
ultimately allow for the reinvention of corporate missions that lead to new products
that can preserve solvency in the marketplace and relevancy to customers.
Managers in the library world are keen to keep their eye on developments in the
corporate world, like the Microsoft/Apply dynamic, because this is place where core
The Bottom Line: Managing Library financial lessons can be found. Younger and younger students are entering university
Finances halls and libraries with a differing set of expectations that drive services and collection
Vol. 24 No. 2, 2011
pp. 118-121 offerings. These expectations are partially driven by consumer experiences and
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0888-045X
influence a new viewpoint that must be engaged. The expectations of paying students,
DOI 10.1108/08880451111169160 and the perspectives of librarians and other university employees collecting fees and

2. tuition, can sometimes appear much less complex than simple financial statements or Robust view of
business model correlation analyses may show. The question is: how truly similar are the revenue
universities, their students and their service offerings to corporate products and
customers making purchases? stream
A closer look at customers and students
When a company like Microsoft loses ground to a competitor, it pulls cash from 119
reserves to develop new products to meet consumer needs and increase sales.
Managers of libraries everywhere, and especially at enrollment-driven schools, can
look at this financial strategy and find similarities in scope along with significant
differences. Libraries are subjected to their funding sources as much as corporations
are reliant on customer wallets. There are, however, no customers at universities
directly funding research and development in a one-to-one exchange. Consumers find
products they think they will enjoy – either through leisure pursuits or productivity –
and give funds for acquisition. A company uses revenue from the sale of its products to
develop new tools for future monetary exchanges with the returning clients while at
the same time trying to garner attention from new customers.
Libraries are more complex in the sense that there appears to be a one-to-one
customer exchange, but at universities there is truly no singular product being
developed for consumption. The viewpoint between producer and consumer here is not
linear. It is in the product development process and delivery where corporations begin
to differ greatly with institutions of higher education and their libraries. In libraries,
and university classes, students search for the information they need out of a desire to
excel in courses bearing a minimum set of requirements. Students’ approach to library
and university offerings is significantly different than their approach to consumer
products, because students’ primary source of motivation with collegiate studies is
found in a mixture of inquisitiveness and forced compliance with assignment demands.
Seeking pleasure or greater efficiencies are not primary views for students in libraries
as with consumer goods. How can libraries use the framework of corporate interaction
with their customers juxtaposed against students interacting with university
departments and libraries to show a more robust method of valuing students apart
from mere revenue sources? The answer is found in encouraging a perspective and
point-of-view the embraces the fact that students do consume the product of libraries
and scholarship, but they also contribute something back to the organization from
which the purchase has been made.
Strategic maneuvers: librarian views vs administrative focus
Many collegiate administrators find the idea of equating university operations with
those of corporations to be very appealing (Kenney and Khanfar, 2009). Education can
sometimes be seen a commodity like corn or wheat. Students can therefore be prized as
tools for revenue generation and funding sources before the recognition of their value
as change agents and creators of the future of knowledge is considered. Libraries and
librarians are generally opposed to this profit-centered idea. It is true that, as paying
customers, students at institutions of higher learning drive the development of new
products and services. Increased headcount for an enrollment-driven institution means
a new major may be born, or a new simulation lab may be created. It is also true that
not focusing on student needs through survey responses (now currently seen on every

3. BL retail restaurant chain receipt), or other tricks of the trade in use the traditional
24,2 commercial world, can be disastrous for enrollment goals and accreditation reviews.
College and universities want feedback from their students as much as for-profit
corporations want feedback from their customers. Imagine, however, if every library
checkout receipt had a survey offer printed on the back. Imagine if every phone call to
the library ended with the phrase, “Thank you for calling. Would you be willing to
120 answer a quick survey about our services today?” These ideas may initially seem like
good ways to adopt corporate customer policy and implementation within the library
and other areas of the academy. The issue at hand is not to disparage these ideas
completely, but to challenge library and other collegiate administrators to
acknowledge the debate, and then strategize accordingly. For some institutions,
these ideas work with their culture. For many, however, they are simply too close to the
sterile and disingenuous corporate customer relations methods often disparaged and
ignored by everyday consumers. Library managers must find which viewpoint fits
with their own institutional culture, and decide to work from the inside for support or
change.
In the classic text The Art of War, by Sun Tzu, it is advised that negotiation is both
an offensive and defensive enterprise. Librarians are generally best kept in accordance
with the ending of this ancient writing on strategy – the acquisition of intelligence
(Tzu, 1910). Although library managers may feel negatively about the idea of viewing
students solely as tools for revenue, it is important to realize the middle ground and to
explain the entire situation of higher education to all parties involved in debating this
viewpoint. A consumer view of students is truly an overly simplistic way to streamline
the learning process, and the products created from displays of education. Students are
essentially both the creators of and contributors to their respective fields of new
knowledge while at the same time being the revenue steering growth and university
development. The key to a student’s long term satisfaction with their degree-granting
institution, and the instilling of good memories of services performed by groups like
libraries, writing centers, tutoring centers, and IT support, is the viewpoint and
communication of former. This will eventually lead to the financial success seen in the
ladder. Helping others see the wisdom of this viewpoint takes time to develop, and
careful execution to permeate throughout an organization.
Longer-term vision leading to shared expectations
Is it best that to tell students that they are the customer? Must they be told that since
they pay for a service, they are always entitled to a very specific and easily-anticipated
result? Is this a good lesson to teach students? Institutions of higher learning cannot
expect to clearly transmit the same message that a company like Microsoft sends when
it tells customers that if they do not like the company’s products they may return them
for a refund. Librarians, faculty, and educators form a relationship that is much larger
than the revenue stream born from tuition dollars. The entire academic enterprise must
be acknowledged during the “sale” to the customer in addition to the degree they
obtain at what appears to be the end studies. Universities are unique in that they
provide services, but also expect contributions in return (Burns, 2009). The familiar
customer satisfaction survey on the back of a retail receipt, as it were, is established a
priori when students research, write, codify and demonstrate how the academy’s
teaching and learning resources enable them to create new understandings and

4. viewpoints of their own. Companies like Microsoft and Apple sell products, and expect Robust view of
nothing in return from their customers besides dollars leading to the development of
new products the companies hope will command return dollars at a later date. This is
the revenue
the corporate view of the product and revenue lifecycle. Universities charge tuition stream
while also giving students a charge to develop themselves over time through practice
and demonstration. This more robust viewpoint denotes a much more refined
relationship than any corporate financial figures can show at the end of a fiscal year. 121
This viewpoint also shows each student’s field of study, professors, libraries, and alma
mater as a whole, as inviting them to an intimate cooperation extending throughout a
lifetime. There is no benefit to students, or their degree-granting institutions, in
reducing this richness of perspective. Doing so changes the core mission of academia
entirely, and does a disservice to future students who will reap both the benefits of
knowledge shared in addition to tuition paid.
References
Burns, G. (2009), “The customer’s not always right at every B-school”, Chicago Tribune,
December 17, available at: www.chicagotribune.com
Kenney, M.G. and Khanfar, N.M. (2009), “Antecedents of repurchase intention: propositions
towards using marketing strategy to mitigate the attrition of online students”, Services
Marketing Quarterly, Vol. 30 No. 3, pp. 270-86.
Tweeny, D. (2010), “Apple passes Microsoft as world’s largest tech company”, available at: www.
wired.com/epicenter/2010/05/apple-passes-microsoft/
Tzu, S. (1910), The Art of War, translated by Lionel Giles, available at: www.gutenberg.org/files/
17405/17405-h/17405-h.htm
Corresponding author
Terry Cottrell can be contacted at: tcottrell@stfrancis.edu
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