What Small Colleges Need for Their Survival

News of the travails of small colleges has continued throughout the summer. Following Sweet Briar’s planned and later rescinded closure, we have watched others: Ashland’s release of tenured faculty, Bay Path University’s too-optimistic plans for online education, the failed merger of Montserrat College of Art with Salem State, and the yet-to-be consummated merger of Union Graduate College with Clarkson.

What is missing from many of the published stories of these transactions is the extent to which expert, objective, comprehensive analyses were undertaken before the announcement.  My own experience with two transactions at the Thunderbird School of Global Management has provided many lessons.

Small schools, like those mentioned, lack economies of scale, face heavy burdens of fixed, overhead costs, and are often highly dependent on annual tuition revenue. It is no surprise that they struggle. What is saddening is the potential loss of schools like Sweet Briar and Thunderbird. The very good news for Thunderbird is that it survives now as a unit within Arizona State University with the completed merger. We would have lost much if Thunderbird had closed its doors. Its historic origin from a World War II air-training base is palpable as you walk the campus grounds. Thunderbird’s specialized global education is needed now more than ever. Its students with their cognitive complexity and global outlook are terrific. Its independent-minded, globally dispersed alumni are assets to international companies, governments and NGOs around the world.

The presence of distinctive schools like Thunderbird and Sweet Briar strengthens higher education; they add diversity to students’ choices. But preserving them is complex and challenging. The challenge and complexity may not be so evident to those inside the institutions, and that is why expert help is often needed for the future of these valuable, but vulnerable institutions.

Small, vulnerable schools need an objective analysis that often comes best from the outside and those who have experienced the challenges and successes associated with improved institutional viability. Schools need an environmental analysis that offers blunt perspectives of their markets. They need an institutional analysis that reveals the trends and realistically confronts the culture, governance, and financial constraints. Schools have to take into account the complex issues of accreditation and the processes of accrediting bodies. Schools need alternatives; one size does not fit all.

For some small schools, a merger like Thunderbird’s may be the best alternative. For another, it may be new programs, including online ones. For still others, operational changes, including sophisticated CRM, may be the answer. For still others, it may be refinement of what the school stands for in its perceived brand. It may be a partnership with an outside company. And it may be a combination of all of these. But in every case, thorough, objective diagnostics with financial analyses and forecasted trends are the first steps.

I want to see schools like Thunderbird continue to work their magic and educate students. And many alumni and students may say the same for their schools. These great schools deserve an objective look at themselves and their alternatives. Experienced, external expertise is part of the answer.

Advertisements

Accountability in Higher Education

The original name of this blog was Access With Success. Since its founding 5 years ago, it has drawn attention to two key education issues: access to education for all qualified students and successful outcomes from education. On July 27, US Education Secretary Arne Duncan spoke about the same two issues at the University of Maryland-Baltimore County. Mr. Duncan’s remarks identified three needed shifts in our attention to higher education: a focus on outcomes, needed innovation as well as student debt and the costs of higher education.

Too little attention has been paid to higher education’s outcomes. The issues of accountability get lost in the attention to the cost of college and the level of public debt, despite their very significance. Greater attention has to be paid to accountability. That is why I wrote, “Just graduating is not enough” in a recent blog. I wrote about the experience of our administrative team in bringing about accountability with transparent information on students’ performance at Colorado State University. Too few US colleges have adopted and maintained what we instituted there almost a decade ago.

However, there are changes that we can make in the coming reauthorization of the Higher Education Act, which was originated in 1965 and last reauthorized in 2008. Those changes can address the need for greater accountability. They include publishing data like those envisioned in the College Portrait on the Department of Education’s website. Parents and prospective students deserve information about college persistence; graduation rates; and postgraduate employment, education and career choice. This information makes good consumer sense.

The needed changes to the Higher Education Act also extend to accrediting bodies. Mr. Duncan observes in his remarks that regional accrediting bodies pay little attention to outcomes and accountability. He is mostly right. Years ago I served on a site review team of a major research university up for its periodic regional accreditation review. Another team member and I were very concerned with whether the university’s honors program was delivering a quality education. We had met the young people. They were enthusiastic about getting an education, and they appeared highly intelligent. They deserved more than what they said they were getting. Yet, the site review team’s report, led by one of the accrediting body staff, paid little attention to our concerns about outcomes. There are needed changes to higher education accreditation, including more streamlined processes, requirements for evaluation of a college’s outcomes, and encouragement for innovation in light of the financial challenges especially for small schools.

The Department of Education cannot take on the entire burden for accountability. Many don’t want it involved at all. I believe they are wrong about limiting too severely the Department’s involvement. There is a role for the US Department of Education. There is also a role for states and the institutions, themselves. States can take action now to demand outcome rather than input data from state schools. They can also take action to make that information publicly available in accessible websites. Private and proprietary institutions can do the same.

Mr. Duncan’s remarks address all of higher education, not just for-profit education. We have needed this widespread focus on all of higher education. I applaud what he has done. I hope his remarks receive widespread attention and debate.

The Consumer and US Higher Education

Demonstrating that US Higher Education provides real benefits to society is essential. Society’s considerable support of higher education in federal and state funding merits it. Consumers – parents and students – deserve it in order to make wise choices among colleges and universities. America deserves it for its global competitiveness.

Two reports in the last month provide relevant criticism and direction. The first is from The Economist and the second comes from the Senate Committee on Health, Education, Labor & Pensions. The Economist’s criticism readily acknowledges that the results of a college education are clear.  Those with more education, especially a college degree, receive higher incomes. This relationship of income to college degree does not, however, prove that higher education is responsible. For those of us with long-term experience in higher education, we know the truth. Excellent learning opportunities abound in our best schools. Good advising helps to lead to career-enlarging choices by students. But despite best efforts, a student can coast by with reasonable intelligence and choices of less demanding majors and easier classes. Too many do.

Society is the loser.   When students graduate with little improvement in their knowledge and skills, US capacity to innovate and become more productive is harmed. We hear repeatedly from recruiters that graduates are too often ill-prepared. Re-training by the hiring business is a major, unnecessary expense; it should not be the norm.

While The Economist’s article, Excellence versus Equity, challenges the notion that US higher education is responsible for post-graduation income improvement, the recent work of the Senate Committee on Education offers potential direction. It points to the opportunity to alter the data provided from schools and it points to the need to alter how those data are used as information for parents and prospective students. It does so in its report, Federal Postsecondary Data Transparency and Consumer Information Concepts and Proposals.

Having had ultimate reporting responsibility at two higher educational institutions as president, I was consistently frustrated by the level of institutional resources devoted to federal reporting and discouraged by the inadequacy of the resulting consumer data. That is why as President of Colorado State University (CSU), I instituted the College Portrait to provide consumers with more information about CSU’s outcomes. It was why I sponsored a trial at CSU of the Collegiate Learning Assessment as a potential means to measure the value added for undergraduates by their education. It was also why I sponsored considerable improvements to the student career services as President of the Thunderbird School of Global Management and why I serve on the Advisory Board of AfterCollege, a career path service for college students.

Just graduating is not enough. It is not enough to warrant the investment and expense of college degrees. It is not enough to satisfy students and parents. It is not enough to meet the needs of society, and it is not enough to retain America’s global competitiveness. Change is essential, and that means collecting the right data in order to provide usable information to consumers. The reauthorization of the Higher Education Act is a potentially positive step.

Student Records and Improvement to College Graduation Rates

This past week, U.S. District Judge Rudolph Contreras ruled against the Department of Education and its Secretary in a request that was filed asking the Court to amend the June 2012 judgment that set aside new rules associated with what is called Gainful Employment.  The Gainful Employment Rule from the Department was designed to motivate for-profit colleges and universities to reduce loan default rates among graduates by insisting on higher levels of post-graduation, successful employment.

The Court’s ruling may well have unintended, but positive consequences if it provides an avenue to improve college graduation rates.  This surprising potential outcome of the ruling comes from the possibility that Congress could use the ruling as a rationale to alter the Higher Education Act’s restrictions on data collection, the basis for the Court’s ruling against the Department of Education.  Those restrictions now limit the collection of student data that could be used to mitigate low graduation rates in our public institutions as well as for-profit ones.

A little background is essential.  The U.S. continues to lag many countries in the percentage of its population that receives a college degree, and low graduation rates impede our economic development.  With the best colleges and universities in the world in the U.S., this sad state of affairs seems inexplicable.  Confounding the problem of understanding and mitigating our low college graduation rates is the increasingly complex attendance patterns of college students.  Those patterns are marked by lower than desired persistence of freshmen students from their first year to second year of college, relatively high transfer rates between community colleges and four-year institutions, dual enrollments in community college and a university, and the inability to track students across those enrollment patterns.

In the middle of the past decade many of us had hoped for the data necessary to track those complex enrollment patterns so that we could analyze them and address the problem.  The assumption is that collecting data and analyzing them are essential to an understanding of the problem and the creation of interventions to mitigate the problem and improve college graduation rates.  Many of us had thought that a universal student unit record was the foundation for intervention that might address the problem.  This form of data could have come from requiring colleges and universities to report student data that would allow us to follow a student through the complex enrollment behavior that has become characteristic in the U.S..

The problem, however, with this solution was one that Americans understand in our commitment to protecting our privacy.  Universal practices of collection of student data represented a threat to the privacy of students.  Therefore, Congress imposed restrictions on the collection of student data that led to the end of hope for a universal student unit record and to the ruling of the Court against the Department of Education’s Gainful Employment Rule.  The basis of the Court’s ruling is embedded in the Higher Education Act which prohibits:

the development, implementation, or maintenance of a Federal database of personally identifiable information on individuals receiving assistance under this chapter’ unless that information ‘is necessary for the operation of programs authorized by’ Title IV.

What is needed now is a careful rewriting of the restriction quoted above and along with its being embedded in the Higher Education Act.  That rewriting should protect students’ privacy but it could also permit tracking of student enrollment patterns for purposes of improving graduation rates.  Whether we should use data to apply rules like the Department’s Gainful Employment Rule is quite another question that this blog has already addressed.

 

Change to Higher Education – Possible with The President’s New College Scorecard

Last week, Penley on Education and Energy joined others in praising President Obama for the Department of Education’s (DoE) new College Scorecard.  Following the State of the Union address, the DoE made available a new information site about college costs, including tuition and student debt.  It plans to offer more information such as employment outcomes later.

Making American higher education more accessible and successful has been a common topic for this blog.   The concern for access with success comes from a concern about students’ readiness for higher education along with affordability of colleges and universities and the extent to which the resulting education lives up to its promise of knowledge and skills needed by the American labor force.  Already the scorecard addresses affordability, and plans include information on the extent to which colleges and universities deliver on employment.

A focus on employment is not inconsistent with valuing a liberal arts education at the undergraduate level.  Those of us who received our baccalaureate education from a liberal arts college appreciate what we found in the opportunity to hone analytic and cognitive skills.  We also hope that we are better citizens as a consequence of that education.  But many of us went onto to pursue professional education in areas like business, law, and medicine.

The US needs a well-educated workforce – with the analytical skills promised by a liberal education – and the knowledge and skills needed by employers.  Our economic prosperity depends upon it, and this is clear from economic growth theory that makes the quality of labor and technological advances central to improvements in economic prosperity.  The DoE’s College Scorecard offers hope that higher education will focus more directly upon cost, speed to degree, and employability.  Time to degree matters; shorter degree programs like three-year undergraduate degrees and one-year MBAs lower debt.

With the addition of information from the College Scorecard on employment, there will also be more motivation for colleges and universities to become far more market-driven rather than faculty-driven.  This information, when it is available, will lead colleges and universities to design their degree programs based on the knowledge and skills that matter upon graduation.  That employer-driven focus on the market will have a positive impact on the quality of our labor force.

A recent Wall Street Journal article on student debt is evidence that the Scorecard will have an impact.  Quoting one parent, the Journal reported her saying, “ . . . it would have been ‘absolutely wonderful’ to have such information when her family was picking colleges.”  In other words, the Scorecard will drive parents and students toward some schools and away from others.  That will, indeed, drive change toward increased access – lower tuition and faster time to degree – and greater success – the knowledge and skills needed for employment.   This is good news.

The 2013 Forces for Change in Education

Forces for change in education will produce more choice for consumers, and that is good news.  What we need, of course, is not just more educational choice but better choices that produce a labor force with greater knowledge and skill sets.  The forces for change will lead us in that direction, but education remains a faculty- and teacher-driven industry that is less market-focused than society needs.

Despite lingering economic challenges in the US and Western Europe, the global economy is slowly recovering.  With that recovery, businesses will start to increase hiring of new talent.  What they will find in the labor market, some believe, is a talent base that is improving too slowly in terms of business-needed knowledge and skills.  We see that slow improvement reflected in the frustration of many young people and their parents with underemployment and long-term unemployment.  One reason for low level jobs and the lack of jobs for many people is their lack of the knowledge and skills needed by business.

In 2013, business is likely to effect change in education as it increases its demands on the education industry for graduates of K-12 and colleges with the skills and knowledge to meet its needs.  Businesses are likely to pressure educational institutions to be more market focused, and that is a good thing.  What will be needed are collaborative efforts between business people and educational institutions to define more market-driven knowledge and skills along with the internal will of educators to drive change into curricula and pedagogy that is responsive to this force for change.  This force for change is likely to increase the demands on traditional educational institutions and to produce more choice in education.

Sunday’s New York Times provided the last in a series of articles about New York’s K-12 education.  Although not focused on common core standards, it unintentionally makes the case for another force for change in American education – the common core standards.

This last article was about classes for gifted and talented students and the disproportionate enrollment of whites in those classes.  The writer made clear that the vast majority of students and most non-whites are receiving an education that fails to challenge students to think and problem solve.  Previously on this site I noted that common core standards are producing pressure for change in teaching methods that increase students’ problem-solving skills.  The sidelining of non-white students to education that is deficient is further evidence that common core standards will increasingly provide a force for change.  And that change will demand teaching methods that place greater pressure on students to think creatively.

Pressure for change on education in 2013 will also come from the transformation in the telecommunications and information technology industries.  The transition from desk-based devices to mobile devices will grow stronger in 2013.  With it, telecoms will move even more vigorously from voice to data in their source of revenue and from land lines to cellular as the medium.  These changes to the telecom industry will provide another force for change to education.  Students will increasingly want readily available mobile, digital access to learning materials.  Use of iPads and their devices will grow and with that growth will come expectations from students that will provide a force for change to education.

Can traditional K-12 and higher education respond to these forces?  The answer is only if educators are willing to be more market driven.  The evidence is not very supportive that traditional education can make the changes necessary, i.e., providing more pragmatic knowledge and skills, altering curricula and pedagogy to raise problem-solving capabilities, and responding to students’ desires for mobile access to learning.

The Open University and Higher Education

A visit last week to the Open University in Milton Keynes, England reminded me of an alternative to some of the challenges faced by higher education.  Right now, traditional higher education differs substantially from the Open University, and higher education without some substantial change is facing many who question its future.  Traditional higher education is under attack from those who question the value and payoff from academic degrees; it appears at times to be threatened by for-profit institutions’ growth in enrollment, and it is being squeezed by limitations on its revenue growth with higher costs for faculty, laboratories and debt services.  At the same time, there is a waning willingness among the public to pay for continuously rising tuition or to provide greater subsidies from already stretched state and federal budgets.

 

As a Professor Emeritus of Management, I have watched salaries in the business disciplines rise as student enrollment has expanded.  I have watched as well as the size of introductory course classes has increased.  No longer are the sciences the only discipline on traditional campuses with very large introductory classes.  Introductory economics classes and introductory business classes in management and marketing are of similarly large size, but mostly without the smaller recitation sections or laboratory experiences of the sciences.  Although universities are proud of the quality of their faculties, there has been significant erosion in the proportion of classes taught by permanent, tenured and tenure-track faculty.  The latter are just too expensive in light of increasingly limited school and university budgets, and they have been moving in that direction for more than a decade.

The Open University chose an alternative model for instruction and instructional design years ago, one that appears to be providing an alternative to the higher tuition prices of many traditional institutions.  With the growth in digital learning resources and the documented quality of online learning today, the opportunities for the Open University are evident.  Rather than using the traditional approach of a lone faculty member designing a course for a single class and having responsibility to update it, the Open University uses an instructional design team to create a course.  The team can include many people, but it usually has at least a learning technologist, a media specialist, and assessor, and, of course, one or more subject matter experts (i.e., the faculty).  This instructional design model is not cheap with its multiple human resources along with the digital infrastructure required for the development and delivery of the course with the support of tutors working with smaller groups of students.  But with relatively large enrollments, its financial viability is evident even at lower tuition prices.

 

The traditional model for education is one that I valued as a student.  But the Open University’s model has a number of attractions, especially in light of the growth in university enrollments and the widespread desire for and availability of higher education.  The model increases accessibility, and it offers smaller classes, admittedly taught by tutors in less frequency than traditional classes.  It takes advantage of students’ growing ease with digital media and their appreciation of it.  And the model responds to the threat of rising costs of traditional education’s tuition and the inadequacy of large introductory classes.  The Open University’s model also takes advantage of the significant changes that are coming to education (see my blog: Digital Learning Day).  It cannot replace the research university for its value in creating new technology, but it has much to recommend it, especially today.