Corinthian Colleges was born in 1995 and its common stock (COCO) was first listed on the NASDAQ exchange in 1999. But the vision for its laser-like focus on training began to take shape back in the 1960s. As a young soldier in the U.S. army, Corinthian's eventual co-founder David Moore was noticing things.
"Many recruits entered the military with no education, no marketable skills, and maybe a chip on their shoulder," remembers Moore. "Thanks to the training, they became literate, employed, and a productive member of society."
According to leadership expert Warren Bennis, formative experiences help create leaders. In the army, where Moore spent 20 years, training is everything. Meanwhile, corporate America has frequently borrowed from military models for employee development. For instance, The Conference Board and the U.S. Military Academy jointly conduct exercises in strategy and implementation, right on a former battlefield. The stage for Moore's future was set.
Community college administration
After his military retirement, Moore's growing passion for training was nourished during two other career stops. For 12 years he worked as an administrator at a community college in Flint, Michigan. "When I got to Flint, the auto industry was humming, and men and women with no education were making a middle-class living," reports Moore. "But then the auto industry moved the jobs from Flint. You know the rest."
In theory, the community college is supposed to come to the rescue during such economic displacement. But, according to Moore, that didn't happen, at least then. Community college faculty were products of traditional higher education. They wanted to reproduce what they were taught and how. With such a mindset, the community college setting was no place for an overwhelmed urban population to find new career skills. From this experience you might say Moore learned what approaches not to take in training people for employment.
Career college administration
Moore's next formative experience came during the two years he was president of DeVry Institute of Technology in Los Angeles. "Training there was targeted like a bullet on marketable knowledge and skills," he recalls. The graduates flourished. Their employers became word-of-mouth ambassadors for DeVry.
Several things were now clear to Moore. Training done right can transform individual lives, organizations and industries. Training done wrong or not offered at all can kill off a generation of the workforce and a once-thriving city. Also, the illusion of having-been-retrained and then not getting or keeping a job destroys hope. Activist Michael Moore (no relation, but with a Flint, MI background as well) became a household name by recording such hopelessness on film.
As the Council on Competitiveness documents, without a high school diploma, people are likely to be unemployed and in poverty. Both The New York Times and The Wall Street Journal have published articles describing how the American Dream is sputtering. That's at least partly due to inadequate education and a mismatch between the skills in demand and the skills people in poverty possess. David Moore was determined to provide a way into or back to the middle class for people who couldn't or wouldn't enter existing educational institutions.
All aboard for the middle class
In the mid 1990s, the Corinthian curriculum began with a focus on remedial education. The eventual career emphasis would be health care, information technology and business. But for that to click, other things had to be put in-place first.
Attracting and retaining 'atypical faculty' was at the top of Moore's list. Desirable instructors had to demonstrate a commitment to nuts-and-bolts skill development and the ability to transmit just-enough information.
In addition, Moore began to search for 'atypical administrators.' They had to share the mission of career training in a for-profit educational setting. Efficiency was a must, and that meant a centralized organization in which everything from best practices to computer systems were shared. Such an organization needed team players who understood how to create and maintain profitability, even enhance the stock price. In short, faculty and administration had to make Corinthian do well by themselves doing well.
Today Corinthian employs 4,100 faculty members. Most of the organization's administrative positions provide student services such as job placement.
David Moore's job description
Moore can usually be found concentrating on one of two things. Half his job description is chief business strategist. Much like former GE CEO Jack Welch, Moore seeks profits by being the leader in a region such as the Pacific Northwest. "If we can't be dominant, we won't be in that area," Moore states.
Just as companies manage portfolios of products, Corinthian manages a portfolio of campuses. Throughout the ten years it's been in existence, Corinthian has expanded through acquisitions and internal or organic growth, while also lopping off what's not profitable.
During fiscal 2004, the organization acquired 11 new campuses in the United States and 46 schools in Canada, of which 10 have been consolidated or closed. Corinthian also invested $75 million to open ten new campuses, remodel others and increase online access. In addition to diplomas and certificates, some Corinthian campuses offer undergraduate and graduate degrees.
More than one message
The other half of Moore's job is Chief Evangelist. He's out there regularly explaining to influencers, be they government representatives or community activists, the link between workplace skills and global competitiveness. According to the Council on Competitiveness, U.S. jobs that require technical skills will grow by more than 50 percent in the coming decade. Present educational and training trends, if they continue, will expand the skills gap. Won't that lead to outsourcing and off-shoring American jobs? What can be done to prevent it? David Moore wants to restore the connection between higher education in America and workforce development.
Moore also sings praises about the benefits of for-profit higher education. In doing so, he's had to include an explanation of a recent controversy surrounding Corinthian that affected the organization's stock price and reduced student enrollments.
Much of the negative attention was generated by an inquiry from the Securities and Exchange Commission (SEC). The regulators requested information about financial reporting that could have had relevance to its shareholders. Corinthian provided the data. The SEC ended that inquiry in January 2005.
"The point I make with those who have had concerns about us as an educational institution is this: No accrediting body has ever raised serious issues about any of our educational policies or operations," emphasizes Moore. "The quality and integrity of our programs is not in question."
The post-Enron Sarbanes-Oxley era has ushered in transparency requirements that can trigger unaccustomed media and regulatory attention toward commercial enterprises, large and small. In addition, Corinthian Colleges is also a commercial hybrid within a largely unaccustomed higher education industry. Corinthian anticipates and receives more than the usual scrutiny. "Adversity and having to constantly justify our approach to education makes us stronger," Moore offers.
Robust growth
Corinthian's strength is reflected in new career training and education offerings that range from HVAC technology to criminal justice. Last year it entered a new niche, providing training for the Canadian government and Canadian corporations, many of whom are newly outsourcing this function.
Corinthian had nearly 60,000 registrations for courses delivered online in the past year. Since adult students tend to learn more in the classroom, online learning at Corinthian is always integrated with instructor interaction. "Unlike some of our competitors," says Moore, "we don't seek to become an online education center."
Woven through both halves of Moore's job description is an essential theme. Career training must always remain the number-one driver at Corinthian. And it must remain affordable. In fiscal 2004, Corinthian's tuition rates for its U.S. and Canadian diploma programs range between $6,000 and $26,000. For undergraduate degrees, tuition is $235 to $315 per credit hour. And for graduate degrees, $390 to $415 per credit hour. The Corinthian price point is higher than a typical community college, and lower than a four-year private college or university.
Corinthian campuses are accredited by a variety of national, regional and programmatic accrediting agencies, so its students have access to financial aid. In fiscal 2004 about 80 percent of its U.S. students received some federal Title IV financial aid.
Last year, Business Week magazine ranked Corinthian number seven among America's fastest-growing small companies. This ranking was based on the company's three-year record in sales, earnings increases, and return on capital. During fiscal 2004, COCO revenues rose more than 55 percent, net income 24 percent and student enrollment 50 percent.
COCO's future
On one hand the future looks quite rosy for Corinthian. Certification is required in a growing number of workplaces. And the workplace is opting for schools such as Corinthian's to provide just the courses needed rather than a more general education.
On the other hand, competitive capitalism is well at work, and the opportunities are obvious to other educators and investors, even Donald Trump. There will be more competition in career training. How will Corinthian maintain its competitive advantage? Research and experience show that in education, leadership is key. Moore wants the best people in the right positions.
The organization can leverage its pioneering spirit about its mission. An informative article in the May issue of Boston magazine describes the attempts among schools in New England's $20-billion higher education industry to regain a dwindling market share. A fresh pioneer spirit might be of real value there.
Corinthian's corporate governance may prove to be a competitive advantage. "As a hybrid institution, from day-one we knew we needed strong board members who understood business and education and would be active in operating Corinthian Colleges," says Moore. "Unlike many other public firms we aren't playing catch-up recruiting and retaining directors who have useful know-how in our marketplace."
Robert L. Dilenschneider is founder and chairman of The Dilenschneider Group, a corporate strategic counseling and public relations firm headquartered in New York, with offices in Chicago, Washington DC, Los Angeles and London.