American Accounting Association

The Future Viability of AAA Members' Programs

Report of the Changing Environment Committee

American Accounting Association
July 15, 1998

Executive Summary

As the AAA and its members move into the 21st century, they face enormous opportunities for adding value in post-secondary education in business and accounting. To add value, the AAA should assist its members in understanding the ever-changing business environment. In turn, members' institutions and AAA members should adopt a responsive strategic focus that reflects their particular strengths. In this way, the AAA, members' institutions, and AAA members will position themselves to remain competitive in the fast-changing market for post-secondary education. Given the pace of change, the time is now for action.

Market Changes
All facets of the "market" for post-secondary education in business and accounting are changing: employers, deliverers, information technology, students, faculty, and curriculum content and delivery methods. Employers are undergoing fundamental changes in organizational structures, definition of core competencies (e.g., learning as a core competency), uses of information technology, and globalization of business activities, all of which combine to dramatically alter the demand for accountants in public practice, business, and government. Non-traditional deliverers of business and accounting education (i.e., corporate universities and for-profit universities) offer a mix of subject matter, time schedules, and credentialing that many students find attractive; hence, they are experiencing rapid growth. Changes in information technology (IT) are having a profound effect on the market for post-secondary education, both directly through enabling a power shift from producers (academia) to consumers (students) and altering delivery methods, and indirectly through its pervasive impacts on all facets of business activities. Undergraduate student profiles are rapidly changing: from recent high school graduate to older, more mature students with work experience; from full-time to part-time; from those willing to accept a "one-size-fits-all" education to those demanding customized education. Faculty see changes in promotion and tenure criteria, pressures to do away with tenure altogether, increasing turnover through retirements, and heightened pressure to perform along new dimensions. Finally, as business and accounting programs become more "customer focused," curriculum content and delivery methods continue to change in response to demands of the market.

Threats and Opportunities
The Committee has identified numerous threats and opportunities to traditional business and accounting programs arising from developments in the environment. Non-traditional deliverers pose several threats including delivering education through more effective use of information technology; offering specialized education that meets the credentialing needs of life-long learners; and continually introducing new curricula to reflect the changing business environment. Opportunities for traditional business and accounting programs arise from the life-long learning needs of professionals in public practice, business and government. Information technology provides the means for developing new innovative approaches for delivery of education. And, partnerships and alliances provide numerous opportunities for leveraging scarce education resources.

The Committee explicitly recognizes that AAA members may be affiliated with traditional educational institutions, corporate universities, or for-profit universities. Hence, although the Committee examined threats and opportunities by contrasting developments in traditional business and accounting programs vs. developments in non-traditional programs, the Committee's intent is not to pit AAA members one against another, but to assist all members in better serving their customers (and their customers' customers).

In formulating its recommendations, the Committee explicitly recognizes that institutions and faculty will differ greatly in the degree to which they have already responded to many of the threats and opportunities identified in this report. Hence, each institution and faculty member must weigh these recommendations in light of its own position in the market for post-secondary education.

Based on its examination of the changing market for post-secondary education in business and accounting, the Committee recommends the following actions for the AAA, AAA members' institutions, and AAA members:


Proactive monitoring: The AAA should establish a permanent committee to evaluate the competitive standing of members' programs, to identify changes in the market for accounting programs, and to disseminate the findings to the membership. Programs that fail should be analyzed to identify the reasons for failure. Other specific elements of this committee's charge should be to: a) examine the status of accounting programs in responding to the constructive criticisms since 1986; b) determine comparative enrollment data for students in directly competitive segments of corporate university programs and for-profit university programs; c) assess the comparative economics of competing programs in terms of student-faculty ratios, faculty contact hours, tuition, research output, etc.; and d) identify best practices in competing organizations.

AAA members' institutions:

  • Adopt a customer focus: A fundamental power shift from providers to consumers is taking place in all segments of the economy, including post-secondary education. To remain competitive, institutions need to adopt a customer focus, which will become the key driver in the design and delivery of post-secondary education.
  • Gain an understanding of the market: Each institution needs to understand: a) the needs of those employer organizations with whom it wishes to place its graduates; b) the needs of prospective students, including degree requirements, credentialing, and other life-long learning opportunities; and c) the strengths and weaknesses of its competition.
  • Develop a strategic focus for accounting program(s): Each institution needs to define the unique market niche that will set its program(s) apart from other accounting programs with which it competes.
  • Put in place a timely, continuous process of curricula development: Each institution needs to identify those "high priority" segments of its curricula that will be pivotal in establishing its market niche and then quickly build new curricula in the identified "high priority" areas. Reduction of cycle time in curricula development should be an integral part of this initiative.
  • Invest in faculty development: Each institution needs to identify new knowledge and skills required to teach the "high priority" segments of its curricula, such as information technology and globalization, and begin to build those skills through faculty development initiatives.
  • Modify faculty reward system: Each institution needs to review and critically evaluate its faculty reward system and, if necessary, modify the reward system to align it with the market-driven mission and objectives of itsprogram(s).
  • Create partnerships/alliances with key corporate employers: Each institution should identify a small group of employers that are key to the success of its programs. These key employers represent potential partners with whom it should pursue alliance initiatives, such as resource commitments by the employers in exchange for access to an enlarged pool of graduates that possess desired competencies.

AAA members:

  • Faculty teaching faculty: Given the limited availability of faculty development opportunities and scarcity of resources, to the extent feasible, individual faculty should be expected to leverage their development experiences by teaching other interested faculty.
  • Faculty as team player: The notion of a faculty member operating as an independent contractor is obsolete. Faculty members must view themselves as team members willing to work together to achieve strategic objectives through program innovations that meet market demands.
  • Utilization of university-wide resources: Faculty should identify and avail themselves of existing resources on their campuses, including instructional development/curriculum design expertise, technology resources and support, writing centers, faculty development centers, etc.


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