Strategic Plan Of The Apollo Group

MBA 580 Presented by: Rose Soto Instructor: John Vincent

History of the University of Phoenix  John Sperling (88 yrs) – Founder  Chairman of the Apollo Group Inc  “Unintentional” entrepreneur now on the Forbes 400 list of America’s wealthiest people  Completed high school  Joined the merchant marine  Went on to Reed College  PhD from Cambridge University (Economics major)

Online Concept Formed Early On  1972 Sperling was chosen to run workshops at San Jose State  Brought in teachers who were experts in their fields, divided the class into small groups, and challenged each group to complete a project  Curriculum he sketched out was slapped down  Stanford University backed his idea  USF became his first client and became a success

Strategic Thinking  Became a for-profit enterprise  “The faculty member is an equal in the classroom. His job isn’t to expound wisdom, it’s to serve a learning group.”  Sperling forbade tenure in his own programs  After a futile five year battle to win accreditation, Sperling left California and headed to Phoenix  In 1979, UoP earned its accreditation

UoP – How a university for working adults should look, feel and function  Main campus has no student center, no fine-arts buildings, no center  School offers undergraduate and graduate-degree programs in business, information technology, accounting, management, marketing  Age of average student – 34 yrs earns between $50,000 and $60,000 a year  1989 Sperling purchased a distance-learning company to create profitable electronic education system

John Sperling was ahead of the game (a strategic thinker)  In 2000 the university’s online enrollment jumped 81%  Phoenix online now generates $327 million in revenue  Analysts at William Blair & Co. call it one of the best- performing tracking stocks of all time

SWOT ANALYSIS  Strengths: UoP offers classes both online and on campus  Instructors are working professionals in their fields  Credit is given for prior courses and life credit is also considered when enrolling

SWOT ANALYSIS CONT’D  Weaknesses: Many other online schools today that rival with UoP  UoP must invest more money in their technology in order to stay ahead of the game  Faces controversy over traditional higher educational schooling

SWOT ANALYSIS CONT’D  Opportunities: To continue being a leader in online education  To increase the program offerings at the school in order to keep up with the market  To expand on a global level and use the same business model that has made it successful

SWOT ANALYSIS CONT’D  Threats: Ongoing battles to force the university to continue to meet accreditation  Many other online competitors will try to gain advantage over UoP with newer marketing methods  Concept of attracting only working adults is changing to lure in students who are completing high school as a potential market share

Financial Key Notes  Since going public in 1994, Apollo has racked up an annual growth rate of roughly 25%  In 2002, it had $1 billion in revenue-a 31% increase over 2001.  Its distance-learning division claims nearly 60,000 students and an enrollment that’s increasing at a rate of about 60% a year  Its stock has split twice and nearly tripled in price since its IPO in 2000, making it one of the few Interact companies to have prospered

John Sperling’s lessons on business: Ignore them  Ignore your detractors: “If I weren’t immune to criticism, it would have been impossible to create and protect the University of Phoenix from hostility and legal assaults. But that’s a unique characteristic that was positive for me. If someone in an organization is indifferent to the feelings of others, he won’t function well.”  Take bet-the-farm risks: “I drove my company to near bankruptcy on a couple of occasions, that kind of bet- the-farm risk taking helped build the Apollo Group. But I had nowhere to go but up. I had nothing to lose.”

More advice we should ignore…  Challenge authority: “If you challenge authority, but you’re not tough enough or shrewd enough to carry it off, you’ll be ill served by this advice. The same can be said for a number of characteristics that have served me best: opportunism, joy in conflict, a thrill from taking risks. None of them is a safe ride.”  Never set a goal: “An English historian once observed, ‘He goes farthest who knows not whence he goes.’ There’s much truth in this. If you have a goal, you’re constrained by the goal. Organizations must have a coherent philosophy, a clear direction, and the strategies to make the journey successful.”

References  Breen, Bill. (2003). The hard life and restless mind of america's education billionaire. Fast Company, (68), 6p. Retrieved May 17, 2009, from Business Source Complete database.  Apollo Group, Inc. (2007). Mergent's Handbook of NASDAQ Stocks (Wiley), (1), p22. Retrieved May 16, 2009, from Business Source Complete database.

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Strategic Plan Of The Apollo Group

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