You Have to Do It All!

I have a couple of brothers who are physicians. One is an OBGYN and the other is a plastic surgeon. Neither can do much for me in terms of critical health care 😉 However, their focus on health made me draw some parallels to things going on in higher education.

For example, 50 years ago the primary focus of healthcare was on heart disease and the effects of cholesterol. Don’t eat fatty food and balance your diet with more reliance on carbohydrates! The result was that we replaced heart disease with diabetes as the most rapidly growing health threat in the nation.

The parallel to higher education is that for the past 40 years the focus has been in inclusion and access. The result, according to new WICHE President Joseph Garcia is that, “we were getting a lot more people into college, but we weren’t graduating many more from college.” Now there is an increasing focus on outcomes, but financing models are still rooted in enrollment. According to Garcia, “I think that instead of spending so much time talking to CFOs and donors, presidents and governing boards need to spend more time talking to students.”

Garcia goes on to prescribe greater collaboration with secondary schools to avoid enrolling high school students “with a 3.5 GPA who then test into remedial courses.” He also recommends more focus on career and technical education programs. “We need to get students training in advanced manufacturing and computer programming.” Clearly implying more collaboration with employers!

So to me, the analogy is that the shift in focus from heart disease to diabetes is comparable to the shift from access to outcomes. The lesson, however, is that like humans, schools can’t just focus on one thing, they have to do it all! They must provide access and outcomes if they are to be successful in the future. Just like people must be aware of both heart disease and diabetes! According to my brothers, all it takes is a balanced diet.

Brookings and College Rankings

Brookings

Brookings and College Rankings
Bill Bradfield
Executive Vice President of Business Development, Greenwood Hall

A good friend of mine put me in touch with a contemporary study of College Rankings done by the Brookings Institution in 2015.  The report, which is both scholarly and weighty, makes a case for changing the traditional rankings (such as US News & World Report) with a methodology that is based on economic outcomes of its graduates.  The report (http://brook.gs/1RHNKBh) makes a case…  if only for the consumer, that schools can be ranked based on a formula calculating a school’s value add as a function of actual outcomes of alumni less predicted outcomes of alumni.  And those outcomes are almost totally economic outcomes.  The Brookings folk make the case for economic outcomes as important by stating, “Earnings are a major and important measure of well-being; earnings data are relatively precise and easy to obtain; and income and other labor market outcomes have have important civic and public policy implications.”

At its very introduction, the report states, “It pays to get a college degree.  Compared to typical individuals with only a high school diploma, typical bachelor’s degree holders earn $580,000 more and associate’s degree holders $245,000 more over their careers.”  While this concept is not new, it is new in terms of the basis of college ranking.  The new approach is both revolutionary and potentially threatening to traditionalists who prefer a “softer” set of criteria…  Are you listening, US News??

The study used five key quality factors to underpin their work:

  • Curriculum Value – Based on the earnings of people who hold degrees offered by the college.
  • Alumni Skills – Based on the average market value of skills listed on alumni resumes.
  • STEM Orientation – Based on the number of graduates prepared to work in STEM occupations.
  • Completion Rates – Based on the percentage of students who finished their degree within 2X the normal time… 8 years for a 4 year degree and 4 years for a 2 year degree.
  • Student Aid – Based on the average level of financial support given by the college to the student.

Admittedly, this analysis doesn’t even begin to approach the depth of the Brookings report.  It caught my attention since it informed a suspicion of mine that, as college costs increase and outcomes become more uncertain, consumers (Moms, Dads, and students, for beginners) will become more discerning about where to spend their dollars.  Maybe the new Brookings methodology will help inform those career and spending decisions, particularly the inclusion of completion rates as a key criteria…  Would you spend $100,000 for an education if the school could only promise a 3 in 10 probability of chance of graduation and only with skills that have limited market value?  Tough question.

So, I looked a little further and found that Brookings ranked 5,000 two and 4 year schools using the methodology (http://brook.gs/1ZnmiHL).  I immediately used the listing to look up my Alma Mater, Lafayette College and found it had scored an impressive 98 (on a scale of 0-100).  That put it ahead of Penn and a solid 8 points ahead of Dartmouth College (the school that turned down my application back in 1966).  😉  Check out the listing, it’s chock-full of surprises.

A Sobering Thought…College May Not Be Worth It?

drunk_homer

A Sobering Thought…College May Not Be Worth It?
Bill Bradfield
Executive Vice President of Business Development, Greenwood Hall

The average return on going to college is falling…  So begins a brief Goldman Sachs Global Investment Research paper from December 2015.  It’s a sobering warning, particularly given some of the equally sobering statistics:

  • For typical students (whoever they may be) the number of years to break even on the cost of college has grown from 8 to 9 years since 2010.
  • If current cost and wage growth trends continue, 18 year olds starting college in 2030 will only start making a positive return when they reach age 37.
  • The gap in alumni earning between colleges in the 99th percentile of scores (SAT as the proxy for selectivity) and those in the 99.9th percentile is as big as for those in the 1st percentile and the 20th.
  • Since 2009, the cost of college fees has grown 10.9% in real terms versus a .9% and -.1% change in wages for high school and college graduates.
  • Graduates from the bottom 25% colleges earn less, on average, than high school graduates.

So, all of this is “sobering” but it does foretell a potential trend in higher education…  that of a rise in consumer awareness, power and choice in higher education.  Will consumers begin earnestly looking to alternate places to get their education?  If earnings potential is low at the bottom 25% of colleges, will consumers make a conscious decision to seek another school, or another path?  Will they make such decisions about schools that have a lower probability of graduation (the national 6-year graduation rate is currently at a startling 52.9%!)?

With all the changes and challenges facing higher education, consumer awareness and threats from non-traditional suppliers (like corporate education and on-line surrogates) just add to the pile.  Education executives will need to be visionary, creative, agile and most importantly, swift in their responses to the threats.  Education is worth it.  The question is, will it be traditional colleges who provide it?

http://www.goldmansachs.com/our-thinking/pages/macroeconomic-insights-folder/what-if-i-told-you/report.pdf

Student Persistence: Blame the Customer

By: Bill Bradfield

Student Failure

I have been reading a fair amount about student persistence and persistence rates. While the reports are both scholarly and well constructed, most of what I have seen is that student persistence and retention rates are actually declining since the current emphasis has increased so dramatically. In fact, in a recent study by the National Student Clearinghouse Research Center, student persistence rates actually dropped 1.2% from 2009-2012.

That got me thinking. Isn’t measuring student persistence (or lack thereof) smack of blaming the customer for failure? As in, “I know that our processes and systems are cumbersome and that we are not yet customer service centric, but, students who have a natural propensity to persist can navigate them and get through the process.” Seriously?

Student retention rates are a real problem. Not just for the schools that have poor retention and 6-year graduation rates, but for the students themselves. Debt-laden former students face a pretty uncertain future, as do schools who leave millions of tuition dollars on the table every year due to poor retention rates.

I wonder what education would be like if schools approached their constituents experience the way Apple does? At Apple, it’s all about the customer experience. Most Apple products are modern, contemporary and actually fun to use! Folks who convert to Apple, generally stay (persist) with Apple. Apple is a customer centric company rife with innovation and loyal customers. Even when the company fails, it retains its customer’s loyalty.

Schools could learn a lot from following Apple’s lead. There is much to be learned from customer centricity and where the responsibility for retaining customers lies. There is also a lot of financial reward and brand equity associated with it.