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Adapting to a Changing Marketplace

Adapting to a Changing Marketplace

3/12/2017

Accessibility, affordability, accountability, and sustainability—these are the four pressure points that converged in 2008 and changed the market, according to author John McGee in Breakpoint: The Changing Marketplace for Higher Education (ISBN: 1421418207). McGee’s unique observations and assessment come from 28 years of experience in higher education, research and policy. In this interview with First American, he discusses his experience, his book, and his recommendations for business officers navigating this changing marketplace.
 
First American: You bring a very personal element to the book with the experiences you have had both on the academic side as the Vice President for Planning and Public Affairs at two liberal arts schools, and on the personal side while looking into colleges for your own children. Describe how you are able to incorporate this personal perspective into your daily work at the College of Saint Benedict and Saint John’s University.
 
Jon McGee: I wrote Breakpoint from two vantage points: as a professional who sits on the cabinet of two institutions that make real decisions in real time and as a parent with children in or about to enter college. On the one hand, I believe deeply in the value of informed decision-making—collecting and then actually using data and information to identify challenges and opportunities as a precursor to strategy. Success favors the prepared. At the same time, though, we need to humanize our knowledge about broad trends. Higher education ultimately is about individual people, not widgets or numbers. Grand averages and massed data by themselves put us at risk of depersonalizing what ultimately is a very personal experience: choosing a college, teaching and learning, selecting a life path. Big data, and even small data, rarely captures the emotion or intensity of emotion that underlies the college choice and the college experience.
 
First American: In what ways can business officers create a culture of more emotional leadership that brings this perspective into their decision-making?
 
Jon McGee: We need to put ourselves in the shoes of our prospective and current students and their families, to try to see the world as they do. It is often a world view filled with hope and ambition. But it also often includes a great deal of fear and uncertainty. It’s our job to look beyond the lens and language of our professional roles to imagine the world in their eyes—and to never lose site that we exist for them, not the other way around. A little empathy goes a long way.
 
First American: How do you best foster an environment with collaboration and empathy among campus leadership?
 
Jon McGee: There are many levels at which to address the collaboration issue. Like many organizations, colleges are mostly well organized vertically. We operate more or less neatly within divisions and departments. That works well in terms of articulating and addressing discrete interests and needs. Problems arise, though, when we must address complex issues that aren’t discrete. We need to be better organized horizontally—working across division and departmental lines to address issues that have implications across the institution.

There are few truly discrete issues left. Seemingly straightforward questions such as; how many students should we enroll, what student profile should we seek, or what programs should we offer or enhance, are much more complex than they appear. They encompass many variables—independent and dependent—and weave together all manner of market, mission, and management characteristics. Effective action demands that the multiple choice variables be dimensionalized in ways that clarify their points of intersection and highlight any trade-offs that may be required.

For example, a decision to increase undergraduate enrollment, simple enough, also requires reflection on enrollment profile and educational identity. Will our profile change? Who will comprise the increment and what might that mean for the learning experience? Is our educational identity appealing enough to attract the additional students we seek? Do we have the support services and physical capacity to serve a larger student body? Do the revenues associated with the additional students exceed the costs of enrolling and serving them? You get the point.

No one division or department is wholly responsible for anything. We work together—and must work together—to own all the dimensions of particular decisions and serve our students. More broadly, institutions have a stake in broader and deeper collaboration. Most colleges operate as independent units—we compete better than we collaborate. But as the population changes and the needs and expectations of new students change, the stakes associated with competition don’t serve us as well.

Colleges of all types have a significant role to play in creating and shaping the future pool of students. We cannot be bystanders to the early creation of opportunity. The new demography demands that we intervene in the college preparation process much earlier and more systematically than we have historically—as individual institutions, through institutional, community-based, and philanthropic partnerships, and through public policy advocacy.

There are five (mostly sequential) steps required prior to enrollment. Students must:

  • Be aware of college as an opportunity

  • Aspire to attend college

  • Demonstrate some level of achievement or preparation

  • Complete an application for college

  • Be able to afford the college choice they seek

For practical reasons, colleges and universities historically have focused the vast majority of their resources and attention on the last two, application and affordability—very often leaving the rest to others or to chance. But the die often is cast long before then for many students. How well we work with middle school and even elementary students and their families has broad social, economic, and enrollment implications. And to do that well, we will need to collaborate better than ever before with a variety of organizations, some competitors, some familiar, but others new and unfamiliar. Our future depends on the success of those efforts.
 
First American: What are some of the ways schools can navigate this changing marketplace when there is often tension that comes with balancing these changes while staying true to their core mission and values? At what point should schools consider a shift in mindset to adjust to this new market?

Jon McGee: This is not the first disruptive period for higher education and it won’t be the last. Our history is characterized by an ability to adapt and subsequently thrive. But that can happen only after we understand the nature of the environment we are in and then adapt and innovate in response to it. Throughout Breakpoint, I tried to convey the importance of knowing and understanding mission, market, and management practice.

We should assume none of that. In periods of market change and shifting preferences, finding a point of equilibrium for all three becomes an especially difficult task. But the new and still evolving marketplace for higher education—characterized by changing demographics, changing economics, and changing cultural expectations—demands a recalibration of equilibrium on campus. Most colleges and universities will need to find a new point of sustainable mission, market, and management balance. Phrased more simply as a question, college leaders need to ask themselves; What steps must we take to create sustainable conditions for excellence in the context for a shifting marketplace that demands change and adaptation? Those choices should not be the by-product of neglect or drift. Few colleges can afford the cost of either.

Too often we jump right to tactic rather than strategy. That is a dangerous approach. We have to begin by asking who we are, what we value most, what forces are playing on us, and how we must reshape, reimagine, and lead. There is no magic point that says, “This is it for all time.” Still, the moment a college is no longer able or willing to adjust its operations to meets its aspirations, its aspiration must change.
 
First American: You stress the importance of what you refer to as “decisive campus leadership.” How can business officers make the shift toward becoming more decisive on critical issues, such as the ones you outline in your book, and what are some ways schools can measure when they have successfully achieved it?
 
Jon McGee: Decisive leadership requires a strong commitment to understanding broad market forces and how they influence the institution, its mission, and the students it serves. You can’t go anywhere unless you know yourself first. That there may be no easily or readily apparent solutions to the many choices and
challenges in front of us makes our commitment to addressing them head-on that much more important. Decisive leadership is not a singular responsibility; it must involve all key players on campus: trustees, presidents, senior leaders, and faculty. As leaders who oversee the financial health of the institution, business officers play a particularly important role. They get to see the whole of the institution in ways few other campus leaders do. Consequently, they need to be particularly attuned to the changing winds of mission, market, and management change.
 
First American: What advice can you give to other campus leaders trying to drive change within their own institutions?
 
Jon McGee: Decisive leadership cannot be measured as an independent metric or statistic. It is reflected in the way campus leaders act and the operating results and outcomes the institution achieves. Richard Chait provides a wonderful framing for strategic and generative leadership in his book, Governance as Leadership.

To reduce the impact of decisive leadership to an old-time phrase, ultimately the proof is in the pudding. The well-lead institution continuously engages its present and its future, ensuring that its mission and values provide the lens for that assessment. It doesn’t mean they have definitively solved all of their challenges. But it does mean they have a commitment to identify their challenges and opportunities to address them.

They work to find points of equilibrium that allow them to serve their students and their mission to the best of their ability within the limits of their resources. In Breakpoint, I provided a series of campus conversation guides—sets of structured questions—to help campus leaders wrestle with questions related to differentiation, changing markets, pricing and spending as a platform for shaping pathways to the future.

Over many decades, most colleges and universities haveshown remarkable resiliency and adaptability as their operating circumstances have changed. While some suggest that the number of colleges who close will increase, I think the more immediate danger for many is the slippage towards a kind of sustained
weakness, trapping the institution into an annual process akin to disease management that closes off the ability to think beyond the challenges of the present. It remains possible to stay open and afloat, but it saps the energy and vitality out of the institution.

The tyranny of the immediate rarely results in anything good. The best way to avoid that condition is to remain absolutely vigilant about changing market conditions—demographic, economic, and cultural—and to take assertive steps either to head off problems or identify points of opportunity. That is what defines decisive leadership. Complex times require that colleges and universities continuously take their own market pulse and evaluate their course. Bad things happen when we take our eyes off the ball.

First American: There is a balance between schools increasing their net tuition revenue to be able to sustain the institution and proving the value they provide in a compelling way. Your book focuses on how schools need to differentiate themselves and effectively communicate the value they offer. What are some examples you have seen of schools that are doing this well?
 
Jon McGee: Let me frame this question a bit, first. As leaders, we have to be vigilant to avoid becoming consumed by two traps. The first is the tyranny of the present, which causes us to focus our work and energy almost exclusively on the most pressing issue of the day or moment—the current budget, the incoming class, etc. The second is the assumption that the past is in fact prologue for the future—that past trends do or should suggest future trends or outcomes. Each comes at the expense of consideration of and
preparation for the future.


Click here for more on Jon McGee's book, Breakpoint.


About Jon McGee:
Jon McGee is currently the Vice President for Planning and Public Affairs at the College of Saint Benedict and Saint John's University in Minnesota, serves on the cabinet of both colleges and is responsible for research and analysis in support of enrollment, budget decisions, strategic planning, and leadership in support of campus visibility. His academic and analytical background paired with his experience of looking into colleges for his own children guide this blueprint for how other college leaders can address complex challenges. 

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