Results tagged “Economics”

The LAUSD Dinosaur: Dismantling The Economics Of Scale

(Mensaje se repite en EspaƱol) The only justification that I have ever heard for the continued existence of LAUSD is the economics of scale. Simply stated, this is the notion that larger organizations can buy goods and services for significantly less money than smaller organizations, because of the quantity and consequential discounts they are able to get because of their size.You can see this principle in practice in a companies like Costco or Home Depot, where these companies abilities to buy larger quantities for less gives them a significantly lower unit cost, which ultimately gives them a market advantage over smaller businesses whose unit costs are higher. At LAUSD, the second largest school district in the country, where economics of scale should thrive, nothing could be further from their daily reality, since the majority of what they purchase is acquired from "agreed upon vendors," whose status as such insulates them from market competition that might ultimately have given them lower costs in educating students. In addition, not only does LAUSD not benefit from the economics of scale, they rather incorporate the worst ills of any too-large organization that suffers from the lack of coordinated management that comes from being so very large, cumbersome, and unaccountable. Cue the dinosaur business model.