The purpose of this assignment is to analyze how businesses interact with their internal and external environments. Students will also apply their knowledge of decision-making models, techno

West Chester Private School Case Study

The following case study is based on true events. Names and identifying details have been modified.

West Chester Private School (WCPS), based in Phoenix, Arizona, and was founded in 1944 by the Chandler and Gilbert families who owned the school for 70 years. Over the years, the school acquired a reputation as a premier K-12 academic institution with an advanced curriculum. Parents described the school as having a high-performing, in-person academic environment that provided a rigorous curriculum while fostering a safe, family-oriented atmosphere in a place where community was valued. Not surprisingly, the student population grew, and the school opened five campuses in the Phoenix metropolitan area. In 2014, the Chandler and Gilbert families sold the school and its campuses to an educational consortium called Education Management Services (EMS). Even under the new ownership, the environment in the various WCPS campuses was still described as achievement-oriented, supportive, and desirable place to work as an educator.

In 2018, WCPS attempted to expand its campuses into Southern California, but the attempt was unsuccessful due in large part to regulatory factors within the state’s accrediting agencies. WCPS leadership focused so much on this expansion, in addition to launching an international baccalaureate, program, they failed to capitalize on the opportunity to expand their business virtually (i.e., online learning). In 2019, however, WCPS was successful at launching an International Baccalaureate Program (IBP), with the first graduating class scheduled for the spring of 2023.

Despite this success, WCPS decided to close two of its Phoenix locations due to “low enrollment” in early 2020. Families were notified that all other campuses would remain open. School closures were not entirely uncommon, as the economic recession in the United States between 2005 and 2011 led to many organizations going out of business and the education sector was not exempt (U.S. Bureau of Labor Statistics, 2013). Additionally, WCPS faced increasingly intense competition from charter schools, which are independently operated public schools. In the fall of 2019, two top-rated charter schools opened campuses within 5 miles of each WCPS school closing. What is troubling is that both EMS executives and WCPS administrators were aware of these competitor schools opening as early as 2017.

Shortly after the closures, the head of the school retired. In response, EMS executives appointed Dr. Audrina Murphy as the new head of the school. Dr. Murphy, a well-educated and experienced administrator, worked with "strategic planning experts" to create a new mission for the school. Dr. Murphy embraced her new role and continuously assured parents that the remaining campuses would remain open. Parents who attended the Parent Teacher Student Association (PTSA) meeting in early January 2020 affirmed that she offered assurances at the meeting.

January 2020

Winter break started on Monday, December 23, 2019, and students were scheduled to return to school on Tuesday, January 7, 2020. On Monday, January 6, 2020, the north Phoenix campus principal received information that the campus would close at the end of the semester and this news was conveyed to faculty and staff at the school. Only two campuses would remain open.

Parents were outraged, students were in disarray, and faculty and administration were in shock. If parents had been informed earlier, it would have been possible for them to try to secure a spot for their children at one of the schools nearby. However, open admissions at the surrounding schools had closed earlier in December 2019. Parents attempted to place their children on waiting lists, but most lists had already filled up, some in excess of 800 students. Additionally, many local schools had already completed their hiring for the following academic year, leaving WCPS faculty and staff limited in employment options.

Parent Meeting

Parents were invited to a meeting on January 8, 2020, to meet with the head of the school, Dr. Murphy. Parents invited the media to the meeting, but the media was denied access. At the onset of the meeting, Dr. Murphy took the podium and began by praising the north Phoenix campus and its community. These statements bothered some of the parents, who demanded to know why the school was closing if it had all the positive attributed to it.

The meeting grew tense and heated. Parents felt betrayed because of the timing of the closure announcement. Dr. Murphy stated that buses would be provided to shuttle children ages 2-12 to the other locations. This would not be a viable option for many parents, but the announcement timing left them with few options. Other parents tried to negotiate with the administration to run the school for one more academic year so families would have enough time to transition their children. Dr. Murphy did not agree to this proposed solution.

Some parents offered to pay more in terms of tuition, but WCPS administration again did not agree to this proposal. Parents asked if the closure was due to financial reasons. Dr. Murphy replied that finances were "not a factor" and the closure was for "demographic reasons."

While Dr. Murphy stated that the reason for the closure of the two campuses was not financial in nature, Moody's analytics reported that the parent company (EMS) was experiencing some strain. The rating of Moody's analytics is a representation of the analysts' opinion of the creditworthiness of an organization (Moody’s Analytics, n.d.). In light of the financial strain reported by Moody’s, and the situation would only get worse.

Moving Forward

Following the parent meeting in January, some families pulled their children out of WCPS immediately, prior to the completion of the academic year. Those families received no financial reimbursement as parents had signed a contract for the academic year. Other families decided to withdraw from the school at the end of the semester. By March 2020, the COVID-19 pandemic was a worldwide crisis and U.S.-based K-12 school districts decided to shutter for the remainder of the school year and required students to complete their coursework remotely. This created significant challenges for students who did not own computers or have access to high-speed internet and WIFI. Beyond that, WCPS teachers struggled mightily to adjust to emergency remote teaching (ERT), as a massive skills gap was identified. Thus, only teachers who had prior experience with virtual educational technologies, such as Zoom, Google Classroom, etc., were able to effectively deliver course content to students.

In addition to school closures, federal, state, and local governments in the United States decided to lockdown all “nonessential” businesses. As of June 2020, the unemployment rate in the United States stood at 11.1%, with a reported 21 million people out of work (Pickert, Rockeman, & Bloomberg, 2020). The short- and long-term (negative) effects to the U.S. economy, in addition to local and state economies, are virtually incalculable.

As the school year came to a close in May 2020, WCPS assessed next steps. A small number of students from the north Phoenix location planned to transfer to one of the two remaining locations. More troubling, however, was that few parents decided to keep their children enrolled at WCPS’s remaining locations, which appeared to be related primarily to the economic hardship experienced by parents as a result of the pandemic and, secondarily, to the growing distrust experienced by parents and students about how WCPS handled the most recent school closure.

What was not known at the time was that the technology gap with regard to (some) students not having accessing to technological devices and adequate internet access, in addition to the teachers lacking the skills necessary to deliver instruction remotely, played a significant role in decision making about parents withdrawing students from WCPS. In addition, many of the teachers lacked the technology skills necessary to deliver online instruction on such short notice. With no training or support provided by WCPS to assist, many teachers struggled, expressing frustration and higher levels of stress, exacerbating already stressful times due to pandemic concerns. Subsequently, this impacted motivation and hindered productivity. Ultimately, this played a significant role in parents’ decision making in regard to withdrawing students from WCPS.  

In late-June 2020, EMS executives, Dr. Murphy, and WCPS administrators began scrambling after having learned that many parents decided to enroll their children at Allegiant Academy, one of the new charter schools that opened in the fall of 2019. When founded, Allegiant Academy understood the evolution and expansion of learning modalities and created a robust online academy in addition to traditional, face-to-face classrooms. Thus, Allegiant Academy is prepared for delivering high-quality instruction in the fall of 2020. With on-going questions surrounding the 2020-2021 academic year due to the COVID-19 pandemic, especially considering that K-12 education will be delivered online/remotely, the future of WCPS is uncertain. As the effects of the pandemic persist, along with declining enrollments at the two remaining locations, financial hardship experienced by parents, increased competition, and general distrust, the viability of the business is suspect at best.

References

Moody’s Analytics. (n.d.). Credit risk modeling. https://www.moodysanalytics.com/solutions-overview/credit-risk/credit-risk-modeling

Pickert, R., Rockeman, O., & Bloomberg. (2020, June 9). What is the real unemployment rate? Your questions about the shocking jobs report, answered. Fortune. https://fortune.com/2020/06/09/us-unemployment-rate-jobs-report-how-many-americans-jobless-unemployed-bls-labor-market-faq/

U.S. Bureau of Labor Statistics. (2013, January 15). Travel expenditures during the recent recession, 2005–2011. The Economics Daily. http://www.bls.gov/opub/ted/2013/ted_20130115.htm

© 2021. Grand Canyon University. All Rights Reserved.

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