Online program management and potential principal-agent problems

ABSTRACT Enrollment pressures and other considerations spur Master of Public Administration online offerings, and specific skillsets are needed for implementation. Online program management providers (OPMs) are for-profit companies that bundle services to establish academic programs in exchange for tuition revenue sharing agreements, upfront fees, or a combination of the two. In such relationships, principal-agent problems may arise in which a company’s profit motives conflict with a university’s larger set of goals and, as a result, stakeholders should recognize the dynamic. However, the lack of industry transparency and emerging business models impede easy understanding. Analysis of contracts obtained through open records requests and other documents (a) identifies available services and (b) reveals potential problems as well as mitigation tactics. Findings contribute to our understanding of what OPM agreements entail, including the contributions made by faculty and other university personnel.