The Testing Industry Its Evolution and Future Directions

3. The Testing Industry Its Evolution and Future Directions Louis Woodruff NCTA Conference San Antonio Texas August 7, 2009

4. Texas is as large as all of New England New York, Pennsylvania, Ohio and Illinois combined San Antonio Texas San Antonio Texas

5. Texas includes 267,339 square miles. 7.4% of the nation's total area

6. There are more than 70,000 miles of highways in Texas

7. The world’s largest parking lot is located at DFW Airport The Airport is larger than Manhattan

8. Texas is home to Dell and Compaq Central Texas is often referred to as the Silicon Valley of the South

9. The name “Texas” comes from an Indian word meaning friends or allies

10. Texas was an independent nation from 1836 to 1845 Texas is the only State to enter the nation by treaty instead of annexation

11. The last battle of the Civil War was fought in Texas It was a Confederate victory

12. That same year…1865…forty years before the Wright brother’s historic flight a Texan flew a coil-spring-powered airplane

13. The craft soared totree-top heights before crashing into a henhouse killing several chickens and scaring many children

14. Rodeo is the official Texas State sport World's 1st Rodeo was in Pecos Texas July 4, 1883

15. Just two years after the 1st Rodeo Dr Pepper was invented in Waco There is no period after the Dr in Dr Pepper

16. 75% of the world's Snickers bars are made in Waco

17. The average American eats 42 quarts of popcorn annually!! More popcorn is sold in Dallas, per capita, than anywhere in the U.S.

18. The first word spoken from the moon on July 20, 1969 was "Houston"

19. The armadillo is the official State mammal

20. In Texas, for $150 you can become a licensed dead animal hauler

21. CCTC NCTA Test TACTP Exams In Texas it's illegal to put graffiti on someone else's cow

22. There are 18 million people in Texas and 16 million cattle

23. In “Texan” the plural of y’all . . . is all y’all

24. Texas is a national leader in the alignment of elementary and secondary curricula and assessment TAKS TEKS

25. Texas Association of Collegiate Testing Personnel Founded 1988 Administration of educational and psychological testing and assessment programs at Texas colleges and universities  Promote, implement, and evaluate professional standards professional testing personnel Disseminate information to professional testing personnel Promote continuing education and foster public understanding

26. The Testing Industry How Big is it? Testing Professional Not Your College Major Not Your Original Plan

27. Recently Reported Size of the Testing Market The Testing Industry • in 1955 - $7,000,000 • in 1997 - $253,000,000 • in 2007 - $700,000,000

28. Recently Reported Size of the Testing Market True False The Testing Industry $700,000,000 X

29. Recently Reported Size of the Testing Market The Testing Industry Educational Testing Service $700,000,000 - Reported Annual Cash Flow $50,000,000 - Contract in California

30. Recently Reported Size of the Testing Market The Testing Industry $700,000,000?? Likely more than triple that size . . . . . . and growing ! ! !

31. The Testing Industry Multi-Billion Dollar Industry Large Diversified Market Profit Opportunities ? Supporting Technologies Future Growth Potential

32. Low Margins Losses Limited Capital Expensive Demanding Infra Structure Diminishing Economies of Scale Complex and Costly Development

33. Low Margins Losses Limited Capital Expensive Demanding Infra Structure Diminishing Economies of Scale Complex and Costly Development HOW DID WE GET INTO THIS SITUATION ?

34. What were the early forces that shaped the modern standardized testing market? What role has Academia (the colleges) played in the evolution of the Industry? What market forces & business dynamics are driving the Testing Industry today?

35. Are there lessons to be learned from the past that can be applied in the present to shape a better future for our Industry?

36. In 1845 Boston schools applied “uniform” testing for all students through oral examinations. In 1874 the superintendent in Portland Maine, created a uniform curriculum with “standardized” tests. He published the scores. Soon after that he was removed!

37. An important lesson for those seeking change! A well intentioned action, ahead of its time, may be throttled and pounded into extinction. OK…but are there any business lessons from the past for the testing industry?

38. There is a lesson from the past for today’s Testing Industry . . . to be learned from the history of the #2 pencil !

39. Slates and chalk continued to be used after the pencil was invented due to high costs for the manual production of pencils In 1866 a patent was granted for a wood-plane machine enabling mass production . . .

40. This enabled the unit cost of the pencil to be lowered . . . Within 4 years over 20 million pencils were sold $ $ $ $ $ $ By 1903 the eraser was added and the cost dropped to a penny . . . the “new technology” (the pencil) was soon embraced in the marketplace

41. . . . this is the same situation the testing industry has repeatedly confronted . . . $ $ $ $ $ $

42. Having the technology is not enough. Having what the market needs is not enough. $ $ $ Through mass production and robust distribution channels, manufacturing has to provide the market the “right” unit cost ! $ $ $ $ $ $

43. Business Mandate Market Need Funding Sources Viable Product Low Unit Price Enabling Technology Distribution Channels Production Capability

44. Before we look at how the testing industry has handled this business mandate . . . we should first look at the forces that gave birth to today’s testing industry?

45. Today’s testing industry grew out of Academia in pursuit of scientific missions!

46. Early 1900's The College Entrance Examination Board published subject syllabi for schools to teach and colleges to test. Edward L Thorndike applied the scientific method to the construction of tests to measure academic performance. Lewis Terman at Stanford created the Intelligence Quotient (IQ) by dividing mental age by chronological age.

47. by the 1920's These tests were developed by Academics within the Universities. Those Universities supported the costs to develop these tests as well as the cost to bring them to market. Within two decades multiple standardized tests were in use.

48. by the 1920's The Stanford Achievement Tests were created to assess subject knowledge. The California Achievement Test was published. Researchers at University of Iowa developed the Iowa Test of Basic Skills. The Scholastic Aptitude Test was introduced. Cola Wars of Testing

49. 1930's Universities and the College Board were operating their own commercial testing business. However, hand scoring of answer sheets and manual processing of score reports kept costs high and limited use. By the mid-1930’s the fledgling industry was reaching its capacity for growth.

50. The testing industry, birthed through Academia, Measure Academic Achievement was facing the same challenge faced by the #2 pencil ! The Universities Scientifically Based Academic Assessments Still Needed: Enabling Technology Production Capability Academia’s Business Challenge Distribution Channels