Experts warn that the competitive landscape for colleges may shift
in the wake of the recent global economic downturn and national
pressures for increased numbers of college graduates. A special panel
at AGB’s recent National Conference on Trusteeship, moderated by AGB
President Rick Legon, examined how ready colleges are to adjust to new
economic and competitive realities. The following Q&A is adapted
from the discussion.
The Panelists:
The Honorable James Geringer, former governor of Wyoming and board chair, Western Governors University
Kevin Reilly, president of the University of Wisconsin System
Jane Wellman, executive director, Delta Project on Postsecondary Education Costs
Robert Zemsky, author, Making Reform Work: The Case for Transforming American Higher Education
Rick Legon, moderator and AGB President
Legon: Kevin, let me ask you the basic question. Does higher education as a sector—an entire sector—need to change?
Reilly: Yes, I think we do need to change to meet the needs of
the United States in two very big ways that will be difficult for us to
manage.
We’ve all seen the data on our falling behind in terms of the
percentage of our population with college degrees. We’ve been stuck at
about 39 percent for 20 or 30 years. Others have vaulted ahead of us.
And I know there’s lots of noise around how accurate some of the
numbers cited are, but I think there’s no doubt that we have fallen
back.
We are stepping up to the challenge at the University of Wisconsin. At
our board of regents meeting, we’ll lay out some goals for degree
production by 2025 in our total university system. We’re going to do it
in three ways—more enrollment, much better retention and graduation
rates for the students we now have, and using the new modes of
instructional delivery and new credentialing protocols to get degrees
to a lot more folks who have some college credit but haven’t finished.
These are folks who can’t come to campus and abandon their spouse,
partner, dogs, or kids and move into a dorm for two years to finish a
degree.
One piece of the change is how we use our system to produce more
degrees. And we’re going to have to do it at a lower cost per degree
than we’ve ever done it in the past. We are now $1,500 below our peers
in the cost to educate students in the University of Wisconsin system.
We were $1,200 below when I took over as president. But we’re going to
have to drive that cost down further by use of technology, by some of
these credentialing protocols—credit for prior learning and those kinds
of things.
On the other side of the coin, we’ve got to have jobs that have legs
for the 21st century for those new graduates once they finish their
degrees. So a big part of what we have to do is to be the economic
engines that help create the new jobs through our research. This
includes getting more of our intellectual property from the initial
discovery to patenting to licensure to commercialization.
Legon: Jim, so much of what we’ve been facing over the last few
years in higher education and across society has been related to the
country’s fiscal challenges at the state level and elsewhere. What else
is changing around us that requires higher education to make some
fundamental changes?
Geringer: Although we are all very aware of the fiscal situation
in the states, we may not all be aware of how dramatic it will be for
quite some time. Over all, just to get back to 2008 revenues in our
states will take at least four to six years, and the head of the
National Governors Association refers to a lost decade.
And given the demands on federal spending, the ratio of the federal
debt to our gross domestic product is increasing rapidly. So the
capacity to draw funds from the federal side is diminishing
significantly.
With greater demands and fewer dollars probable, what’s changing is the
need for individual institutions to decide how many partnerships to
form strategically. As an example, we formed Western Governors
University as a strategic partnership among the western states to
leverage the capacity of our existing institutions (190 institutions in
18 states) beyond what they could do individually. We also adopted the
principle of competency-measured education—measuring knowledge, not
courses taken, using independent assessments. It has worked quite well.
We have high retention so far, with 18,000 students.
Change will come about, I think, as much as anything out of necessity
due to increased demand. I think what’s going to be colleges’ greatest
challenge is not doing more with less. You will have less. Now, will
you do more?
Legon: Jane, you track these things. Do you think the changes
that you’ve seen, to this point, are moving us toward being in a
position to increase completion rates, as the country is seeking?
Wellman: Yes and no. Looking around higher education,
particularly looking at public big systems, I think there’s more
evidence now of real efforts to address the mismatch between resources
and need, and to do a better job educating the current student
population than I’ve seen in 30 years of observing higher education.
Will the changes be enough? And are they strategic? I’m not so sure.
Much of what’s going on now is a response, necessarily, to budget cuts
and revenue shortfalls, with institutions doing what they must. We
haven’t really made the transition into what I think we must do better,
in every type of institution. And that is strategic decision making
using data. We copy last year’s budget and roll forward with changes
around the edges.
We know very little about the relationship between spending and real,
robust measures of student learning. Should you spend your marginal
dollar on student aid or student counseling or by getting more faculty
members into the classroom? Nobody really knows the answer to those
kinds of core questions—which should be empirical and shouldn’t be that
hard.
I think individual institutions have to step up to this challenge, but
I think we also have a public-policy challenge here, particularly at
the state level. By and large, I think state-policy capacity now for
setting an agenda for higher education is weaker than it was 20 years
ago. And we very much need it to be stronger.
Geringer: I would suggest that institutions demonstrate how
their partnerships can work to allow colleges to do more with
less—those strategic partnerships where you actually show you are
increasing productivity. Use those as the example of what you have
gained, what you have saved, and what the increase in opportunity is.
That sets the benchmark for the legislators to say that higher
education gets it—“Look at the example they’ve given us, and they have
to have the data to back it up.”
Legon: Bob, in your latest book, Making Reform Work, you
advocate meaningful change. What is it that you’d like to see the
academy consider by way of meaningful change or transformation?
Zemsky: If you’re really going to change what we’re talking
about, there are three things that have to get on the table that never
do. The first one is time. The way that we divide time in the academy
now is very, very expensive.
Second, we have to talk about what it really means to be a faculty member.
And the third is about the curriculum. We have enshrined choice.
Everybody gets to choose; they get to choose to start on Tuesday
instead of Monday at 8. We get to choose what we want to teach, when we
want to teach it, how we want to teach it. We get to choose how many
majors we’ve got. We’ve got almost no ability in the academy to say No.
And so we constantly add. It isn’t that we’re wasteful. We’re just
over-choiced. Anybody who runs any business knows that you cannot have
constant changing of the product line and have any economies of scale
whatsoever.
Legon: How can boards and administrators have the kind of
meaningful conversation that includes faculty, to get these kinds of
changes moving forward?
Reilly: One good suggestion is to have regular sessions between
your board and faculty members about how faculty members really spend
their time. You know, it’s 8 a.m., and what is the faculty member doing?
I don’t think trustees generally have a very good feel for that. Then,
in conversations based on that kind of evidence about what faculty
actually do, engage them in these tough conversations about whether
that’s what the institution needs them to keep doing. Is that what the
state—if you’re a public institution—needs them to keep doing, what the
country needs them to keep doing?
In institutions like Western Governors and some of our for-profit
competitors like the University of Phoenix, there are new roles that
have developed for faculty—they are more the curriculum developers and
mentors of the instructors. Now in effect, we’ve also done that in
traditional institutions. In the University of Wisconsin system now, 40
percent of the undergraduate coursework is taught by non-tenure-track
faculty or instructors. That’s a way we’ve saved some money on faculty
salaries.
More and more, I think, our faculties are going to morph into those
kinds of mentors and curriculum developers—with others doing more of
the direct instructional work.
Legon: How do we change the conversation in the board room at this point toward strategic priorities, strategic decision making?
Wellman: The first thing trustees need to do is try to move from
annual budget balancing—which institutions still need to do—into a
mindset about strategic finance. What really are the two or three
priorities? And how are you spending your resources to get there?
The second point I’d make is that, for all of the appropriate focus on
faculty and curriculum at the core, we are ignoring how money is spent
now in ways that are hugely inefficient—for administrative and support
costs. Over half of the money at almost every institution goes for
something other than core faculty and student support.
For example, at the University of California-Davis, they’ve recently
gone through an exercise to consolidate payroll functions. It was very
painful. Jobs were lost. Tough choices had to be made. But they
discovered that by having separate payroll functions in virtually every
department on the campus, they were spending $40 million on that one
function. By consolidating it, they saved $8 million. That’s a whole
lot more money than savings from cutting out core program options in
the English department.
So we have to come at it from both the delivery and the administrative
side, and be willing to look with a very unsentimental eye at all of
the automatic spending in our institutions for things that don’t
materially contribute to the quality of core teaching and learning or
even research.
Reilly: If we want to get to the possibility of some new
investment to avoid cuts—and the possibility of greater flexibility in
how we run our operations—we’re going to have to show that we’re trying
to deliver to the state and the country and its citizens what we need
to deliver.
In the University of Wisconsin, we have relatively less state money
than we’ve ever had before. But we still have about a quarter of our
budget—over a billion dollars a year in our operating budget—that is
state taxpayer dollars.
Legon: If we were starting with a clean slate, what might the academic experience look like in order to hit our goals?
Zemsky: Well, it would start to look a little bit like Western
Governors, actually. You would actually say that “seat time” doesn’t
matter the way it used to. My estimate, for what it’s worth, is that
about a third of the core undergraduate curriculum could be taught by
competency-based activities. When you’re ready to demonstrate that you
know the facts, you go in, take the exam, get the credit.
Another change would be using technology more for teaching. It turns
out there are three basic areas in which you can do this, but we’re
just not doing enough of it. One is with math. One is English
composition. And the third is languages.
The other thing is that it’s time to get away from the four-year
baccalaureate degree. We’re in a world now where really the core
postsecondary education is five years. It really should be three years
for a bachelor’s and two years of masters’ study. But the only way to
get to a three-year degree, actually, is to do the first things I
mentioned, which is change the curriculum, use technology, change use
of space.
Let me caution, however, that I’m a lifelong faculty member, and what I
am talking about can only be done by faculty. You cannot sit in a board
room and design what I’m talking about. I’m also a trustee, and I know
my job on the board is to create environments in which the faculty
members do the redesign. And the good news about faculty is that we are
really pretty smart people if you get us moving in the right direction.
And that’s the job of boards: Get us moving in the right direction.
Geringer: At Western Governors, many of our courses are taught
by tenured faculty but using technology, and using academic, as well as
progress, mentors who work one-on-one with the students to assure their
progress.
I’m an engineer by profession. I’ve seen many of the functions
performed by civil engineering, mechanical engineering, and electrical
engineering outsourced overseas. What if, using today’s technology,
many of our courses were outsourced overseas? That’s the alternative if
we don’t take that initiative ourselves. China in particular has said
it wants to be the world’s innovator. Well, let’s innovate ahead of
them, instead of them just reengineering what we are already doing.
Reilly: We’ve announced a couple of three-year degrees at a
couple of our institutions in the UW system, and we want to move in
that direction. But I’d actually like to move down from six-year
degrees, which is mostly what we have now for about 57 percent of the
population who get bachelors’ degrees.
If you complete a UW degree in four years, you save $15,000 that you’d
have to spend to go the fifth year, and maybe another $15,000 for the
sixth year. Students may say they can’t afford to pay the tuition and
will work in a minimum wage job for 30 hours a week throughout college.
But if they’re paying $15,000 or $30,000 more because they can’t take
as many credits each semester, that doesn’t make a whole lot of sense.
We know that lots of our students are working lots of hours now, and we
know what that does to the cost of their education and our own
productivity. The longer students stay, the fewer seats we have for new
students.
A lot of this will depend on what we can do with financial aid. Can we
say to students, “You don’t have to work 30 hours a week. We want you
to work no more than 15 or 20, and we’ll find ways to get you financial
aid to cover the difference if you need it”?
Legon: Jane, can you suggest how boards or specific board
committees—finance committees, academic-affairs committees—could frame
some specific strategic questions related to cost and delivery and
institutional priorities, so that they don’t drift too far over into
the management side of the equation, but can ask effective questions?
Wellman: I think the first question is to ask where the money is
spent and what the patterns have been over time, and where spending is
increasing proportionate to other areas. That will show whether your
administrative costs are growing relative to your academic costs.
The second one is to ask about student access and attainment and the
proportion of needy students who are being served by the institution.
Reducing gaps in degree attainment between socio-economic and racial
groups is the single most important dial we need to turn if we’re going
to make our attainment goals. And that takes investment of resources
and financial aid, it takes aggressive counseling, but mostly it takes
setting the goals and paying attention to performance.
Find out how you’re spending your money. Ask two or three simple
questions about what’s driving the costs. Don’t get distracted by all
of the other spreadsheet things that we can get distracted by—how
you’re spending your money in your auxiliary enterprises or your
hospital is irrelevant, for the most part, to the core academic
program.
Legon: What kind of change do we need to see within our research institutions?
Zemsky: That’s a whole different discussion, but in an odd way,
it relates. There’s an NIH study out that essentially complains that
all the money it’s spending on these huge research grants is for
filling in small gaps in the knowledge. The funders are beginning to
worry that the faculties at research universities are practicing what
might be called safe science. That doesn’t mean there isn’t good
research being done or that there aren’t good researchers out there.
But they aren’t reaching for the horizon aggressively enough.
There are some very basic questions on the research side about whether
the money we are spending—we still spend more money than anybody
else—is actually producing the kinds of things that Kevin was talking
about that are going to be the transformative insights for the rest of
this century.
Reilly: Let me say that if you’re at the University of Wisconsin
engaged in cutting-edge stem-cell research and you’re talking to
certain portions of the population and certain portions of the
legislature about it, it doesn’t feel like safe science.
But on this research-to-jobs issue, I think we really need to claim
some ground here. The Wisconsin Technology Council, which is an
independent 501 (c) (3), put out a report last year that said academic
research and development in Wisconsin is a $1.1 billion industry that
employs either directly or indirectly 38,000 people. That’s more people
than the construction, rubber products, and paper industries employ in
Wisconsin.
This means academic research and development is a major industry in our
state now. And it’s an industry that’s creating jobs that are the jobs
of the future. I think every institution, not just our research
institutions, has a contribution to make in terms of creating new jobs
through the research that we have conducted and helping our staple
industries infuse the new technologies into their operations.
Trustees should think about institutions’ roles as job creators and how
they can support the faculty and staff members capable of producing
intellectual property and getting that down the line from initial
discovery to commercialization.
Wellman: The topic of research brings up for me the question
about graduate education, particularly doctoral education. We haven’t
yet had the conversation about the academic doctoral agenda for the
country and what types of things need to happen to improve the quality
and productivity of that enterprise.
The number of students who persist to a doctoral degree is fewer than
50 percent, so that attrition rate is worse than the undergraduate
attrition rate. The unit cost of the graduate degree is almost four
times that of the average cost for a baccalaureate degree. What does
that mean for efficiency and effectiveness? This has not been engaged
either at the policy level or inside institutions.
Legon: What do you think is the most significant change we’re going to see in higher education over the next year or so?
Zemsky: Well, the sad truth is, we’re not going to see anything
in the next year or two. This is hunker-down time. Maybe the change we
need to see in the next year or two is to simply to say, “Enough
already. Let’s start the conversation from scratch.”
Reilly: It’s going to be rough the next couple of years, but we
need to work with strategic partners to discuss where our states need
to be, coming out of the recession.
Wellman: I think I agree with Bob that this is a hunker-down
time, and we’re not going to see much evidence in the next two years of
deep change. But this is a perfect time for agenda building—to set the
path forward, get the goals in place for access and degree attainment,
do the diagnostic work, figure out where the interventions need to
occur. Are you losing students in the first semester? Is it the math
class? What’s happening to the student flow within your institutions?
Geringer: I recall a comment to me by one of our University of
Wyoming trustees as we were sitting on the stage at graduation. She
said, “How do we know that they know what we say they know?”
The best thing a trustee can do at this point, or the president or any
administrator can do, is to ask good questions. Ask the faculty, “How
do you know that they know what you say they know?” And what don’t we
know that we could know, if we had the right information systems in
place?
You rebuild public trust in small steps. It takes a crisis to finally
get people to work together. Treat this as a beneficial crisis.
