In This Issue
- Two "Must-Reads" Books
- A Four-Step Model for Revitalization
- Brand Challenges – A Lesson from Toyota, by Chuck Reed
Two recommendations for your “must read” stack
By Bob Sevier, Senior Vice President, Strategy
Over the holidays, I had the opportunity to read two books:
- Academic Turnarounds – Restoring Vitality to Challenged American Colleges and Universities by Terrence MacTaggart
- Prioritizing Academic Programs and Services – Reallocating Resources to Achieve Strategic Balance by Robert C. Dickeson
The books
Like you, I have read dozens of similarly focused books. Most have offered little value beyond their suggestive and hopeful titles. However, these two books are different for five reasons: First, they are both readable. Second, they are grounded in reality. Third, they are less about theory and more about practice. Fourth, they are an excellent primer for admissions, marketing, and fundraising professions who are often left out of these conversations.
Importantly, and finally, both authors place responsibility for long-lasting change directly on the shoulders of the president and senior team. While committees and taskforces have their place, ultimately the right decisions, in a timely fashion, need to be made at the top. In addition, neither author is overly distracted by institutional hand-wringing and the “woe is us” that has pervaded so much of higher education. The authors agree that the challenge before our colleges is not so much the economic circumstance of higher education, but how colleges choose to respond to that circumstance. In addition, both authors indicate that many of the problems facing higher education are a result of a generation of colleges living beyond their economic means. Says Dickeson, “Most institutions can no longer afford to be what they’ve become.”
Read in tandem, the books offer significant insight into what is possible
MacTaggert makes his “turnaround” recommendations in three broad areas:
- Stage I: Restoring financial stability
- Stage II: Marketing and branding (with sidebars on recruiting and fundraising)
- Stage III: Strengthening academic programs and culture
To give you a sense of his depth, MacTaggert offers 10 keys for restoring financial stability:
1. Balance revenue and expense growth rates
2. Estimate revenue conservatively before budgeting expenses, and contain or cut expense growth
3. Design a coherent net pricing strategy
4. Put into place a consistent foundation for revenue growth
5. Build a capital reinvestment fund for renovations and equipment replacement
6. Provide a contingency fund and a cash reserve greater than 16 percent of expenses
7. Install budget controls to manage over-expended budgets, track variances, and contain the addition of new employees after the start of a new fiscal year
8. Bill students monthly and establish collection procedures
9. Ensure that college development and alumni relations produce income equal to or greater than their expenses
10. Make certain that auxiliary and athletic programs pay their own ways
While not all keys will apply to all institutions, their internal logic and progression are important.
Dickeson looks at how colleges must continually and realistically evaluate academic and non-academic programs. Too often, these books tend to address only the non-academic side. Dickeson, however, believes that doing so would be short-sighted. Consider the seven points he makes early in his book:
1. Academic programs (such as degrees offered) are not only the heart of the collegiate institution; they constitute the real drivers of cost for the entire enterprise, academic and nonacademic
2. Academic programs have been permitted to grow, and in some cases calcify, on the institutional body without critical regards to their relative worth
3. Most institutions are unrealistically striving to be all things to all people in their quest for students, reputation, and support rather than focusing their resources on the mission and programs that they can accomplish with distinction
4. There is growing incongruence between the academic programs offered and the resources required to mount them with quality; and most institutions are thus overprogrammed for their available resources
5. Traditional approaches, like across-the-board cuts, tend to mediocrity for all programs
6. The most likely source for needed resources is reallocation of existing resources, from weakest to strongest programs
7. Reallocation cannot be appropriately accomplished without rigorous, effective, and academically responsible prioritization
This section alone makes the book a worthy read.
A Four-Step Model for Revitalization
By Bob Sevier, Senior Vice President, Strategy
Lately I have been trying to develop a simple model for campus revitalization; a model that will allow campuses to make positive moves in a number of key areas. Drawing on a number of sources, conversations, and experience, here are my initial thoughts. Of course, the devil is always in the detail
1. Restore financial stability
a. Cut costs
I. Academic side – majors no longer in demand
II. Non-academic side
NOTE 1: Pay particular attention to the appendices in Dickeson’s book, Prioritizing Academic Programs and Services – Reallocating Resources to Achieve Strategic Balance
NOTE 2: Eliminate non-productive areas. Avoid the dangerous “let’s make everyone deal with the same 5% cut”
b. Improve revenue
I. Improve recruiting
II. Enhance fundraising
III. Increase grant writing
IV. Improve retention
NOTE 1: In the near term, focus on recruiting more students from your primary market for existing programs. Developing new geographic markets or launching new programs will not impact fall ’10
NOTE 2: Focus first on your annual fund. Gains there will be almost immediate and will portend your audiences’ interest in supporting a capital campaign
NOTE 3: This will take longer but ultimately will have a huge payoff. Make sure your admissions office targets students who are most likely to persist
2. Identify academic growth areas
NOTE 1: Stress data, not intuition and hopes. Avoid the temptation to simply add programs. Be willing to subtract programs as well.
3. Reallocate resources to support growth areas
NOTE 1: It is not about being fair, but being strategic
NOTE 2: When you do launch a program, be willing to swarm that launch by investing dollars in recruiting, marketing, and financial aid
4. Build a brand to support recruiting and fundraising
NOTE 1: Effective brands differentiate you from your competitors in ways that target audiences value. A valued point of differentiation becomes your most strategic asset
I have tried to keep this as simple as possible. I would welcome any thoughts or comments. Thanks. Bob (bob.sevier@stamats.com)
Brand Challenges – A Lesson from Toyota
By Chuck Reed, Senior Vice President, Client Services
Look no further than today’s headlines for a brand lesson.
I’ve driven Toyotas all my life. The first car I bought was in the The Odd Years for the Corolla, when it looked like a beefed-up version of the iron from the Monopoly board game, 1982. I bought it at Thanksgiving so I didn’t think I needed air conditioning (Nebraska in November, you know). Still, the car never let me down once.
I’ve had Toyota vans and sedans du jour since then, with three sitting in my driveway at home right now for my oldest son, my wife, and I to use. Only age and a cell phone-using distracted driver sliding through a light have stopped any part of them.
Still, Toyota as the “reliability” brand is sure being tested this month.
Living the brand is never easy—colleges take note. Let’s review a few basics and ask yourself how you stack up.
Every one of the more than 3,600 colleges in America has a brand—just a few have a vivid and powerful brand on par with Toyota (owner of the word “reliable”). Many have a brand that is defined and strong in a more regional (and often more appropriate) way, and build on these themes in their operations and marketing messages. Then there are the rest who claim an unproven position or have made no claims and simply let the world brand them, right or wrong.
Living your brand means planning and operating on brand-centric action and deed, not tagline and puffery. Ask yourself what word/idea your institution “owns” near and/or far, and if you’re living the brand:
- If you claim rigorous you make sure admission standards and academic offerings are stringent. No exceptions, even to adult part-time and certificate/degree-completion programs (the latter should probably not exist in such a brand, but they do—they make money and some president chased that dream).
- You can’t swing a diploma without hitting a school that is the most supportive around. So is your business office open 5–7 in the evening for adults, your academic tutoring program so pervasive that you are online or in person with help, and your peer-support programs intentional and required?
- You are the friendly school (you stopped short of “supportive”). Maybe to one extreme your athletic teams are exceptionally well-mannered in defeat and victory; at your core, you instill a level of customer service second to none, and this is embedded in the employee evaluation process.
- You are the region’s success (jobs/career/outcomes) school, maybe built on bar/licensure pass rates or a long exceptional record of proven employment. What happens when you aren’t first in passage rates in a year, as reported in your core area media? How’s that position now, in the recession, and how do you react? If you are the jobs/outcomes expert, are you the place media come to get expert counsel on all things jobs?
- Brand challenges aren’t always instant or immediate. If your brand is tied to a specific church relationship (locally, you are “The Lutheran School,” for example), what does that mean when things erode over time? You evolve to be more Catholic or even Methodist than Lutheran—does this rock your identity? With whom? How does it change how you do business, if at all?
Give some thought to your brand, as best you know it. Do you have a plan to handle a brand-related crisis, be it major or slow to happen? Would you know what to do, and not to do?
Watch Toyota. Take a lesson from their right and wrong actions now.
It’s a reliable lesson.
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