When the pupil is modeled as a "customer" something has to take the place of "revenue" when measuring the relative success of different management- and educational strategies and comparing them to cost. There are different quantifiable "revenues" in education like student-hours, grade averages, diplomas etc. But the focus is on diplomas, passing grades and standardized tests (as opposed to teaching hours or other measures of undefinable value to the "customer").
To cover cost, teaching institutions rely on funding, and funding is tied to "revenue" e.g. test-results and diplomas. This causes a misalignment of incentives that reveals the real customer of teaching institutions: The funding agencies (department of education, local state government etc.). Students, or more specifically diplomas, are the product. And demand is growing. The only rational response is to produce more diplomas and test results. The supply of students who will thrive in a given educational environment, now defined implicitly as "that which produces the desired diplomas and test results" is fixed. Lower standards or lose funding. The NPM-ethos is "run it like a business" so the choice is obvious.