IT training rip-offs

Some shoddy IT schools squander students' time and money. Learn how to safeguard your education investment.

Sue Clark, an IT pro at a heavy equipment manufacturer in Wisconsin, was taking online classes last year in the hopes of advancing to a higher-paying job. Clarke was halfway through the coursework she needed to earn her Certified Novell Engineer (CNE) certification when she logged onto the school's Web site one Monday morning last March to find this message:

"The Masters Institute has closed. Sorry for the inconvenience."

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Without any warning, the San Jose computer science training center had shut its doors, leaving Clarke and about 5,400 other students without the certification they were working toward and without their tuition - which came to more than $10,000 a year.

"It was very scary," says Clark. "My family - we don't make a lot of money. That's why I was going to school so I could get a better job and improve our standard of living. I kept thinking, "I'm going to lose $10,000. I started to cry when I had to tell my husband."

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The IT training market

Fortunately for Clark, it all worked out. She was able to transfer her student loan and continue her IT training at the University of Phoenix. And she recently landed a higher paying job as IS network coordinator at Reinhart FoodService in LaCrosse, Wisc. "My training definitely helped me get this job," she says.

IT training is big business. Last year, U.S. companies spent roughly $12 billion to train their techies, according to IDC. Network executives want to keep their IT staffs - everyone from those manning the help desk to system administrators - on the cutting edge of technology that continues to change at lightning speed. What's more, thousands in the IT field are footing the bill themselves for education that will help them climb the corporate ladder.

Regardless of who writes the check, they're paying upward of $15,000 or even $20,000 a year to do it. In a flagging economy, that's a steep investment for a company, especially when you multiply it by several employees. And for someone reaching into her own pocket, the hefty price tag could wipe out a nest egg or rack up student loan payments for years to come.

But how safe is that training investment? And how much work are companies actually doing to make sure their training funds, and their IT staffs, are well cared for? Getting good training isn't so simple, students and IT executives say.

Clark isn't alone in her training disaster. In California, 300 of the state's 3,000 private post-secondary and vocational institutions close every year, according to the California Department of Consumer Affairs. A spokeswoman for the U.S. Department of Education says the organization doesn't track the number of schools and training centers that shut down, but it could number in the thousands.

Underperforming investments

The number of failing schools means many people are losing a lot of money.

Students such as Clark who took out student loans to pay for training were able to transfer those loans to other schools or training centers. They lost time, momentum and often enthusiasm, but didn't lose all their investment.

However, students who paid for classes out-of-pocket and corporations footing the bill for their employees simply lost that tuition. It wasn't retrievable or transferable.

"I actually had only another month and a half before finishing when the Computer Learning Center [CLC] closed," says Kenton Payne, a network administrator in Fort Washington, Pa.

He paid $3,000 and took out $12,000 in student loans for an eight-month network engineering boot camp. "There were a number of students who had literally just started, and some of them had paid all cash upfront. They paid $15,000 and got four weeks of education," he says.

CLC, in Alexandria, Va., has a story similar to Masters'. Both training centers closed down early last year without prior notice to students or government agencies. CLC had 2,500 students enrolled when it shut its doors. A spokesman for the California Department of Consumer Affairs says both institutions were underfunded and overextended, bringing in too few students for new e-learning ventures and underestimating the cost of the new online programs.

Compounding their problems, both Masters and CLC were investigated by the Department of Education, which reported administrative problems at the schools.

But financial distress and school closings are only part of the problem. Students, industry analysts, high-tech job recruiters and even one instructor say some training centers offer poor-quality instruction - at full price.

"The teachers really didn't have a hold on the subject matter," says Payne, who crammed for two months after CLC closed down to finish studying for the Microsoft Certified Systems Engineer (MCSE) certification exam. "Sometimes students began teaching more than the teachers. . . .Classes organized little coups. Students complained about some of the curriculum and the teachers in charge."

For Jake Mavity, a 20-year-old tech support worker at a California software company that he asked not be identified, the quality of the instructors was just the beginning of his training problems. Mavity paid $9,000 to the Santa Ana, Calif., branch of Lanop Center to study for MCSE, CNE and Certified Cisco Network Associate certification, only to get to class to discover that the instructor was handing out photocopies of the instruction manual, complete with Xs where photos or network design illustrations should have been. And to add insult to injury, it was a photocopy of an outdated manual.

And that's all before Lanop, a 15-year-old company that trained people to take high-tech certification tests, closed down last spring - before Mavity could get all of the certifications he wanted.

Mavity wasn't the only one with training trouble. There were 12 U.S. centers operating under the corporate Lanop umbrella, according to John Goodfriend, Lanop founder and president, who says he's not sure how many students were enrolled when the schools closed last year. Goodfriend says he tried to sell off each center as individual franchises but says he believes only about five now are operating independently.

"By the time we closed, we were in terrible shape," says Goodfriend, who blames Lanop's demise on Microsoft forcing platform upgrades and discontinuing certifications. "That was sort of a disaster."

After Lanop went under, Goodfriend tried to start up a group of Linux-based training centers, called Linux Centers USA. Without the support of a major vendor, Goodfriend says the venture never took off. "It was a good idea that didn't work."

For Mavity and other students like him the core problem lay with the training itself.

"I barely passed my test," says Mavity, who knew enough of the old material to scrape by. He says of the Lanop facility, "There was network cabling hanging down from the walls. The network had been kind of thrown together. . . . It was really stressful, and I was frustrated and angry. It's still kind of hard to talk about."

That's a common complaint, according to Dennis Hartle, a senior Novell instructor who taught at Lanop for 2 1/2 years. Hartle says some training centers graduate students who haven't laid hands on a network, teaching them less about the network and more about what to memorize.

"[After they graduate,] the students are not prepared for a job," says Hartle, who now teaches at Computer Education Institute. "It's the way the subject matter is taught - or not taught may be a better way to put it. . . . Memorize the answers for the certification test. Take the test. They're not teaching for them to have a job."

The way to avoid these problems is to thoroughly investigate any training center before signing up. IT managers should set policies about which training centers or schools employees can use, according to analysts, students and corporate trainers.

"There are some bad apples that are spoiling the whole lot here," says Bob Klehm, research director at Giga Information Group. "There's a lot of information out there . . . and they need to kick as many tires as they can."

Creating a list of what training centers can be used, along with a policy on how classes are paid for, saved Lanetta Denise Pitney's employer about $10,000.

Pitney, an IT specialist at a large California testing and measurement company, started taking MCSE for Windows 2000 classes last January at a small branch of New Horizons Computer Learning Centers, which is headquartered in Anaheim, Calif. She says the classes were hands-on and practical, and all was moving along fine until that particular branch shut down toward the end 2001.

Pitney's employer, which didn't want its name used, didn't lose its $10,000 because company executives struck a deal with New Horizons that the payment would go straight to New Horizon's corporate headquarters and not to the branch's coffers. Pitney is continuing with her certification training by taking New Horizon classes online.

Barry Stauffer, CEO of Corbett Technologies in Alexandria, Va., an $11 million IT security firm, says having a tuition reimbursement program is one of the ways he takes care of his staff. Corbett offers each full-time employee $5,000 a year for job-related training, and last year he spent $20,000 helping to train 20% of his workers.

But finding a good school and working out the deal is up to the employee.

"We've not prescribed [where they can go], though we certainly recommend some," Stauffer says. "I'm not too concerned because most of our people are going to regular colleges and universities in the area. . . . Though, it's something we need to consider."

However, some companies get more involved.

At BankOne in Chicago, there's actually a full-time, eight-person team that sets up training for the company's 2,000-member IT staff. The financial giant largely offers its IT employees in-house training - called BankOne University - but offers tuition reimbursement for classes taken with outside vendors.

But BankOne is very specific about which training firms employees can use.

"We do a lot of investigation into any vendor," says Debbie Graye, training manager for technology and operations at BankOne. "We do a rigorous analysis of the state of the vendor's business."

Graye says BankOne also compares pricing; finds out if the training center will customize a student's course makeup; checks the background of the vendor and the instructors; and even sends people to audit the classes.

And for a company that has previously spent $750,000 on IT training a year, that's simply guarding its investment.

Last year's school closings might actually have been good for the IT training industry, says Marjorie Bynum, vice president of workforce development at the Information Technology Association of America.

"It's been a warning to students," Bynum says. "People are investing in their education and career . . . and people need to do as much homework as they can before committing. And it's a reminder to schools to mind their p's and q's."

IT training rip-offs

Underperforming investments

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