Investing in Improvement: Strategy and Resource Allocation in Public School Districts

Executive Summary:

The operating environments of public school districts are largely void of the market forces that reward a company’s success with more capital and exert pressure on it to eventually abandon unproductive activities. HBS senior lecturer Stacey Childress describes the strategic resource decisions in 3 of the 20 public school districts that she and colleagues have studied through the Public Education Leadership Project at Harvard. The stories in San Francisco, New York City, and Maryland’s Montgomery County occurred largely before the districts faced dramatic decreases in revenues, though they show the superintendents facing budget concerns near the end of the narratives. Even so, the situations share common principles that superintendents and their leadership teams can use to make differentiated resource decisions—reducing spending in some areas and increasing it in others with a clear rationale for why these decisions will produce results for students. Key concepts include:

• Given the rarity of strategic approaches to resource allocation described in the examples, it is clear that district leaders need more guidance and tools to help them make better decisions and manage the consequences, particularly when they are under enormous fiscal pressure.
• Back your strategy with a resource plan—otherwise it is not a strategy.
• Don’t get trapped by the dogma of decentralization.
• If leaders alienate influential stakeholders when budgets are flush, it will be even more difficult to preserve key strategic investments during financial crises.

Paper Information

• Full Working Paper Text
• Working Paper Publication Date: January 2010
• HBS Working Paper Number: 10-057
• Faculty Unit: General Management