Higher education and its leadership are being forced by events to address a once in every 100-year crisis. It is one that touches upon almost every aspect (and risk) of the operations and reputation of our nation’s colleges and universities. Thus far, the pandemic of 2020 has uprooted the operations of most institutions of higher education; business as usual disappeared almost overnight. And we surmise that it is only the beginning.
Enrollment, revenue/expenses, the value proposition, teaching, and research have all been challenged and these challenges will continue to frame higher education over the next decade at least. The social and racial justice initiatives that emerged following years of racism and abusive policing policies across the country will also continue to impact the nation’s colleges and universities. The virus has forced substantial adjustments to higher education’s traditional model. A new model will dominate consideration by higher education institution leadership. The changes are likely to be more than anything seen since the GI Bill of the 1940s or the Higher Education Act of the mid-1960s.
Higher education institutions will need to act boldly, while ensuring their autonomy, as they address the most effective approaches to navigate a future with many unknowns. With nearly 40 percent of enrolled students deciding to rethink their education plans for the fall 2020 semester, and students whose primary option is to learn virtually perhaps choosing to alter their academic plans going forward, the challenges are substantial. Building sound institutional responses will require careful thought, risk taking, and sound leadership in order to reset the higher education sector. The impact of these factors on the work of college and university administrative leadership, governing boards, and faculty will be transformational in ways that most institutions have not yet fully anticipated.
After struggling through an initial wave of tough decisions for the spring and fall 2020 semesters, institution and system chief executives and their governing boards are now addressing the next set of challenges, including operational plans for spring 2021 and beyond. Practical policy and financial decisions for the immediate future cannot be set without considering longer-term implications, most specifically questions related to the business and financial model of each institution and the delivery of academic programs.
Higher education has been urged to consider meaningful change and transformation for the better part of 20 years. Whether due to necessity or opportunity, and as we contemplate a higher education enterprise that emphasizes the “new” rather than the “normal,” it strikes us as an appropriate moment to ask and address a new set of strategic questions at the leadership level as higher education looks to meet the future. The reset may well involve more online/virtual teaching and learning, with the presumed benefits of the residential campus perhaps diminishing and fewer students choosing the traditional model of education. There will likely be an even greater reliance on two-year colleges as well as other online providers for many students’ first years of a higher education experience because for much of higher education the future will look distinctly different from the recent past.
Perhaps those institutions with the largest endowments and with impressive domestic and international reputations will be able to get through this period with little changed from the past, although all of higher education will likely need to address some fundamental questions. For those institutions—primarily elite and highly selective institutions that might be able to fend off substantial change in their financial model—they may well be able to revert to their previous model. Yet it is unlikely that the higher education sector as a whole will not be significantly affected—needing to address some higher hurdles while also seeking opportunities embedded in pandemic-driven changes.
Collaborative leadership, among institution and system chief executives and governing boards and faculty, will be essential in order to reclaim and shape higher education’s future value. Boards will need to balance the scope of their engagement in a way that is supportive of visionary leadership while committing to a culture of innovation for the future. Governing boards will need to recognize the breadth of their responsibility as essential partners during the challenging and uncertain period ahead. Through their support of fresh strategic planning processes, working from board and committee agendas that focus on value-added issues, and scheduling regular board retreats and special meetings to address fundamental questions about the future, engaged governing bodies are an asset that will be needed during these stressful times for the institution each serves. Board members should balance their expectations between the urgency of immediate action and the requisite patience associated with the implementation of change. Course corrections require care and hard work. How higher education progresses through this period of transformation should be tracked so as to serve the broader interests of the sector over time.
The following represent some essential questions that boards should be asking:
1. What is the future role and value of higher education?
How will the public judge the value of a traditional undergraduate degree? Will a new financial model siphon off students from traditional four-year institutions as students and families consider alternative and more affordable providers and goals?
Governing boards, consisting of women and men who connect the institution they serve with external communities, should engage in a meaningful and strategic consideration of how higher education and the institution they serve fit into the needs and expectations of society. This is not an idle exercise, as the question of the value of higher education (“Is it worth it?”) continues to be among the concerns that prospective students and their families will be asking more fervently.
Setting an institution’s future course will require a renewed and candid approach to conveying the purpose and impact of higher education across society, and consideration as to how any one institution meets that purpose. Institutions will need to determine how to balance their own value vis-a-vis other similar institutions that are also likely to be resetting their financial models. Such conversations will ensure that future strategic plans and direction-setting is based on pragmatic considerations as distinct from a presumptive return to past assumptions and practices that, for many, may be out of reach. Addressing the value proposition question should be a useful starting point for governing boards and institutional leadership to ask and answer.
2. What will our institution’s financial model look like?
Higher education finances were a challenge prior to the onset of the pandemic for many public and private institutions. Between the difficult financial decisions made by all institutions since last spring, and the significant financial unknowns that lie ahead— perhaps without increased federal financial support, and uncertain state funding for public institutions over the next number of years—institution financial models will be part stress-testing of new and unclear models and part guesswork. The uncertainties may result in unpleasant and uncomfortable results for many institutions. And yet, crisis leadership is designed for such moments. Governing boards must understand how they influence the way forward, while having a high degree of confidence in the men and women who have been selected to lead their respective institutions.
Some strategic concerns that need to considered by governing boards as institution financial models are reset include the following:
- Should our institution shift to a more permanent online/virtual teaching model as prospective students reconsider their education options and financial needs?
- Will we (and should we) be able to maintain the breadth of academic programs that so many institutions currently make available?
- How will those decisions impact faculty recruitment and retention, research pressures, and long-term financial commitments such as tenure policy?
- Might institutions consider sharing faculty, especially in a public system structure or regional college consortia? How might those changes impact faculty culture and commitment?
- Will fundraising strategies shift to more operational (budgetary) support while moving away from the larger and more transformational gifts that have defined higher education’s larger campaign goals? And how should those endowed assets that are unrestricted be allocated?
- Should administrative costs be revisited in both overall staffing and compensation packages for senior administrators and others?
- Are we appropriately factoring our institution’s outlays for intercollegiate sports and amenity-driven student recruitment investments into overall and long-term budget realities?
- And will it become necessary to ask sustainability-related questions, recognizing that not all institutions will remain viable and may need to explore collaborative or merger arrangements in order to protect their mission and legacy?
- Should collaborative multi-institution purchasing collaboratives be expanded to establish annual spending efficiencies?
- Could institutions in the same region share more courses and other activities?
- How will the institution demonstrate a clear-eyed readiness to address issues related to social and racial justice issues, diversity in leadership, and ensuring a campus culture that values diversity for all?
The answers to these and other financial and policy considerations will require input from all institution stakeholders; yet ultimately the decisions will be dependent upon effective board governance.
3. How will a reset of higher education impact board governance?
The job of being a fiduciary will grow more complex; it will require a new set of considerations in shaping boards for a future that could be a bit of a roller-coaster ride. The current challenges require that governing boards step up to meet the moment. Collaborative governance, with an effective leadership partnership will be essential as institutions consider the way forward. Boards will need to balance their level of fiduciary leadership and engagement with their support and respect for presidential leadership and healthy shared governance.
And yet, as the reset of the sector unfolds, this is a useful time to begin to reflect on some of the ongoing challenges in higher education’s governance structure. There is much work that can and should be done in this area by institutions and state policy leaders. And there are some creative governance reforms that merit immediate board leadership. The selection of independent governing board members—with private institutions self-selecting their members and public governing board members typically selected through a political process— should be revisited as institutions work through the challenges ahead. Board governance requires a professional commitment to a voluntary role, it requires time and awareness, and it needs courage and curiosity. It is neither about passivity nor advancing partisan agendas. It is about applying sound judgment and innovative ideas drawn from analysis as well as from the experience of other institutions and sectors.
Among those being recruited to serve on governing boards should be men and women who have some familiarity with the higher education business model, and who are willing to make tough and innovative decisions. A reset also provides an opportunity to consider the number of board members serving on private institution boards whose size can, at times, intrude on board effectiveness. And, appointment and selection processes of public institution board members should limit those board members who are in their seats based mostly on political loyalties as distinct from their level of expertise and distinction.
Central to the process and selection of board members will be a needed shift in their diversity. As the country and higher education work through the painful recognition of past prejudices and racial discrimination across our institutions, along with exclusionary biases and hiring practices on our campuses, it is increasingly essential for college and university governing boards to establish a commitment to diversity in the boardroom. Data clearly show that governing boards are insufficiently diverse in their makeup and their leadership; an issue and opportunity that boards should aggressively and immediately address. Higher education’s customers (students) want to purchase their education product from institutions that demonstrate a recognition and commitment to who they are; too many governing boards don’t look like today’s (and tomorrow’s) students. Limited diversity in higher education’s boardrooms will only exacerbate the current problems facing the sector. All governing boards should develop a formal governance diversity policy (and standing committee) that commits them to making progress in the boardroom and across the campus, just as society is confronting its own past racial and social justice challenges.
Higher education governance is based on legal principles that address loyalty, care, and obedience and that serve a public interest. Additionally, governance should be symbolic of all that is good in a sector that has long been driven by moral and ethical standards.
Higher education is facing a pronounced tipping point. Can it continue to be the difference-maker for which it has been seen over multiple generations? Governing boards, structured for the future, need to be asking the right questions and helping to reset the sector for a more uncertain future.
The call for a substantial transformation of higher education has been discussed in higher education circles for decades but change has been slow to come. Now that transformation appears to be bearing down on us. Are we ready?
A. Lee Fritschler, PhD, is president emeritus of Dickinson College; he also served as the assistant secretary for postsecondary education in the U.S. Department of Education.
Richard D. Legon is the immediate past president and chief executive officer of the Association of Governing Boards of Universities and Colleges (AGB).
Takeaways
- The COVID-19 pandemic uprooted much of higher education’s financial model nearly overnight. Colleges and universities must act boldly to ensure the sector effectively addresses current and anticipated challenges. Collaborative leadership, among institution and system chief executive and governing boards and faculty will be essential to reset the sector going forward.
- Governing boards will remain essential voices in advocating on behalf of higher education’s value proposition.
- Board governance will grow more complex and board members must step up to the plate by applying sound judgement and a culture of innovation to their work. Diverse, inclusive boards will ensure that the duties of loyalty, care, and obedience are fulfilled.
- The reset of higher education will deeply impact board governance. As the duties of governing boards grow more complex, trustees must step up to the plate by applying sound judgement and innovative ideas to every facet of their work. Diverse, inclusive boards will ensure the duties of loyalty, care, and obedience are fulfilled.
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