Acquisition of Consulting Firm Signals New Day at Research Group

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The acquisition of a consulting firm by the American Institutes for Research, one of the nation’s largest research organizations in the social and behavioral sciences, could portend industrywide changes, experts said last week.

The institutes merged with the McKenzie Group, a Washington consulting firm that works closely with urban school districts, in an Oct. 15 deal. It was the second such move by AIR in less than six months, and marks a change in emphasis for the fast-growing nonprofit research organization.

In May, the Washington-based AIR announced plans to merge with New American Schools, a group formed in 1991 to bring whole-school reform models to schools nationwide. ("Research Group, New American Schools Merge," May 5, 2004.)

Both the Alexandria, Va.-based NAS and the McKenzie Group specialize in school improvement services, while AIR has made its mark over the decades through research and evaluation projects.

“We really want to expand our work in the area of research-to-practice, and we thought both acquisitions would help us move in that direction,” said Sol H. Pelavin, AIR’s president and chief executive officer.

Some experts said last week that the move could foreshadow other changes among some of the larger private research firms that do business in education. While some, such as the San Francisco-based Wested, have long combined research with more practice-based services, most rely on large-scale federal- or foundation-funded research projects to sustain themselves.

James W. Kohlmoos, the president of the National Education Knowledge Industry Association, a Washington trade group for education research organizations, said the nationwide emphasis on school accountability—exemplified by the federal No Child Left Behind Act—could drive some of those changes.

“People are looking at the market and trying to respond to it, and I think that’s positive,” he said.

Ericka M. Miller, the president and chief operating officer of the McKenzie Group, agreed. “Certainly, NCLB has increased the need for expertise in assessment, curriculum development, and leadership development,” she said, “and data demands are a challenge for some school districts.”

“I think there’s a need for a combination of well-researched, evidence-based practices, as well as an understanding of the day-to-day challenges that schools face,” she added.

Rapid Growth

AIR at a Glance

The American Institutes for Research, a nonprofit founded in 1946, is one of the largest behavioral- and social-science research organizations in the world.

Locations: Headquartered in Washington, with offices in 10 U.S. cities and nine locations overseas.

Number of employees: 1,000

Revenues: $133 million for fiscal 2003

Current education projects:

  • Conducting two longitudinal evaluations of the Federal No Child Left Behind Act
  • Developing the U.S. Department of Education's What Works Clearinghouse
  • Evaluating high school reform efforts financed by the Bill & Melinda Gates Foundation
  • Assisting in the federal Schools and Staffing Survey
  • Maintaining the Education Department's Comprehensive School Reform Quality Center

SOURCE: American Institutes for Research

The new merger also marks a period of rapid growth for AIR, which was founded in 1946. The firm has grown from fewer than 150 employees a decade ago to more than 1,000 now, according to Mr. Pelavin. AIR’s education division, with nearly 600 employees, is its largest. The organization’s total revenues for the 2003 fiscal year were $133 million.

The McKenzie Group, in comparison, has $3 million a year in revenue, Ms. Miller said, and a core of 18 employees in its Washington headquarters. It was launched as a for-profit consulting firm in 1988 by Floretta Dukes McKenzie, a former schools superintendent in the nation’s capital.

Under the terms of the merger agreement, the McKenzie Group becomes a wholly owned subsidiary of AIR. It will retain its brand-name identity and commercial status for the foreseeable future, according to Larry McQuillan, an AIR spokesman.

The McKenzie Group brings to the marriage its experience in having worked in dozens of school districts. Among its current projects, the organization is helping Howard University develop a middle school of mathematics and science in Washington and is providing technical assistance to 30 school districts working with the National Science Foundation to improve math and science teaching.

Besides the McKenzie Group and New American Schools, AIR has hired several former public school superintendents to join in its new efforts toward school improvement. They include: Steven J. Adamowski, a former Cincinnati superintendent; Anthony P. Cavanna, who has been the superintendent of several districts in New York and New Jersey; Libia Socorro Gil, a former superintendent of the Chula Vista, Calif., public schools; Joseph Olchefske, a former Seattle superintendent; and Maria Santory Guasp, a former community-district superintendent for the New York City schools.

Looking for Impact

Mr. Pelavin said his organization’s venture into more research-and-practice projects will not come at the expense of its primary research focus. Rather, he said, it will continue in the vein of international AIR efforts that are aimed at improving the quality of life for children.

With support from the U.S. Department of Labor, for example, AIR has been spearheading campaigns in Zambia and other African nations to move young children out of the workplace and into the classroom.

“All of that work has an immediate impact,” Mr. Pelavin said. “We’re looking for the same sort of impact in the United States, but it’s a lot harder because we’re starting with more sophisticated education systems.”

However, Mr. Kohlmoos of NEKIA warned of a potential downside when researchers known for their dispassionate analyses move into the school improvement arena.

“It’s not always clear where the research component ends and the service component begins,” he said. “You need to be able to draw a line at a certain point.”

Vol. 24, Issue 09, Page 6

Published in Print: October 27, 2004, as Acquisition of Consulting Firm Signals New Day at Research Group
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