The next section of the introductory lecture is going to focus on two slides.
This will be the shortest in duration of these segments, but I want to spend some
time on each of these elements because they have applications in real world
settings as you're wrestling through cost-containment issues on campus. In the
readings we're not going to spend much time on how institutions are adjusting
their operating structures to reduce the cost of instruction. So these two slides,
until we have a chance to be together in Nashville, provide a little bit of an
opportunity to explore what other institutions are doing and then if this
is an area of interest we can converse via email or in person in Nashville with
respect to particulars. So as institutions; community colleges,
universities, private institutions, public institutions are examining costs are
examining their response to increased pressures from elected officials to hold
down tuition and fees.
What are the levers that they can pull to help minimize the cost side of the
equation. The revenue side of the equation as we witnessed in the prior
section of this lecture really comes from two primary sources state
appropriations and tuition and fees. So in an era of stagnant or declining state
appropriations coupled with increased pressure from public sectors to hold
down tuition or in a Promise era, I think there'll be growing calls on the
community colleges to minimize tuition and fees so that Promise can remain
within its financial projections. What are things that you can pull as
administrators, as faculty members, as staff to help balance the revenue and
expenditure side of this equation? So as you can see on the slide, there are three
thematic elements here and there will be a couple thematic elements on the next
slide. But within administrations, there are items that many institutions in many
systems
implement in order to realize administrative savings. First strategic
procurement. Rather than Northeast State or Motlow State or Walter's State buying
paper independently, through the collective purchasing power of the Board
of Regions they're able to purchase paper lower price. The same can be said
for banner the same can be said for anything that comes through a shared
services contract. Our state has implemented SciQuest, as have a number of
states across the nation, which brings together the collective purchasing power
of institutions to help savings from a strategic procurement perspective. The
next in shared services in the back office functions of your institutions. Some of
you may have looked to a third-party provider for the call center for your
financial aid office or you may have outsourced foodservice to Sodexo, AirMark
or Chartwells. You may look to enterprise to run your institutions
fleet rather than maintaining a portfolio of vehicles that require then
staff to support their maintenance. All of those are examples of efforts that
institutions have utilized to recognize cost savings from a back-office
perspective, Another's energy you see institutions utilizing energy savings
contracts to make investments in their physical infrastructure, their steam
plants, etc. to bomb that out and then to repay those bonds based but upon shared
expectations and energy savings. You're seeing that with lighting improvements
moving from traditional in fluorescent lighting to LED lighting brighter, more
safety, respective elements associated with lighting on campus, but cost savings
associated with that that are then paid out in long-term bonds. And then
personnel costs. Institutions are examining staffing levels in the extent to which
they may be over and understaffed and then right-sizing their institutions
from faculty and staff perspective. The next is through strategic investment.
How do we retrofit mechanical equipment? I referenced earlier, investments in
physical infrastructure moving from coal to natural gas is something that many
universities, ours included,
have done from retrofitting perspective transfer savings from student services
functions. Thereby maximizing investments and retention. So rather than spending in
an athletic area, for example, to take those savings reinvest them in student
affairs, in advising services, etc. with the hope that those investments will
maximize retention rates which will then generate additional tuition revenue and
benefit the institution from funding formula perspective. The purchase of IT
equipment to upgrade efficiency and system productivity. D2L is a wonderful
example of cost savings from an IT perspective, but you're seeing
institutions moving to the increased use of apps and IT elements that streamline
the process aspect of an institution. Allowing one person to do the work of
four as you bring systems into an electronic portfolio. And then other
institutions looking at faculty and staff pay plans. This will be a critical
issue with the implementation of the FSLA standards in 2016.
How do we ensure that we are complying with federal labor regulations to ensure
that we are not recognizing subsequent downstream increases in the production
function of institutions, because of our staffing portfolios. And then there are
efficiencies on the academic side. Improvements in the cost affection of
developmental education. We've seen this in Tennessee with the implementation of
the sales program and the integration of developmental education into a
traditional course experiences rather than standalone R&D programs and the
faculty to support those R&D programs as we had in the seventies and
eighties and nineties. Many institutions the Board of Regents has led this to
examine low-cost programs THEC has been involved in this as well, but to bring
together those programs that traditionally are low producing there by
realizing savings on the faculty side or on the staff side. You see institutions
looking to increase the credits that are produced off-campus online or through
prior learning assessments.
Thereby diminishing the need for full-time tenure-track faculty in some
respects, also pushing out to institutions in an off-campus perspective a
lower-cost means of production then you have on the traditional campus setting.
The enhancement of cohort and alternative delivery models and
curriculum redesign. Tristan Denley, the Board of Regents is doing a lot of work
around the redesign of programs that prevent transition through the pipeline
for undergraduate students. And last but not least, institutions looking at
space utilization. We will touch on space utilization and some of these elements
as we discuss RCM budgets later in the semester, responsibility centered
management within RCM frame. Subsidiary elements within the university would pay
for space, so rather than the University covering the cost for space across
campus departments would pay for the space that they use within the
institution's infrastructure with the thought and the realization from a
research perspective that departments are then much wiser stewards of their
resources when they're having to pay for space rather than space being paid for
by the institution as a whole. What can we do to maximize revenues from an
administrative perspective? Institutions are looking about at chargeback elements
across campus. So rather than the provision of services for free print
shop, photographic services, IT services, etc. many institutions are charging their
departments for the provision of such services just as if IT, print shop, etc.
was a third-party entity. They're increasing fund raising expectations for
Deans, Presidents. department heads, etc. with the recognition that external funds
from the philanthropic perspective can help balance decline to state
appropriation and support the operations of the institution. You're seeing many
institutions develop profit models for their off-campus centers. That those off
campus centers become cost centers, they stand on their own, they receive no
cross-subsidization from the university, there by realizing efficiencies in the
production function. You're seeing public-private partnerships that
maximize land resources. So rather than a University building a residence hall on
its own, you work with a third-party provider
who would construct the capital, they would incur the debt service
payments, and then an institution would guarantee occupancy in that residence
hall so that pays off the note and then 30 years later that facility transfers
to the University so the use of market-driven, public-private
partnerships to meet the capital infrastructure needs of the academy. And
then you're seeing budgeting at the campus level linked to planning goals. The
next element from a revenue perspective is enrollment growth. If you're unable to
increase tuition fees, a way to maximize revenue is to grow your enrollment. So
reaching out to new markets, adjusting financial aid programs to maximize the
yield on those institutional investments, if you know that you're going to have a
hundred students with 29 ACT scores come to your institution and you're
providing them with five-thousand-dollar scholarships, would that 100 remain 100 if
you reduce the scholarship to 3,000, took the net savings invested those in need
based programs which drive enrollment across the institution, partner with
alumni to help market and recruit the institution in new areas, to develop
online programs to coordinate marketing campaigns across universities. Many of
you as you logged into this course on D2L, as you looked at the course syllabus,
or if you see my lapel pin you notice that the university has one consistent
mark the E with the state of Tennessee in the middle. When I arrived as President
four-and-a-half years ago, we had a hundred and thirty-two logos across
campus so it was difficult for the institution to convey its message in the
marketplace when they were multitude of images that represent the university. It
was hard to tell what was ETSU and what wasn't ETSU. So by moving to one
consistent visual identity it makes it easier for someone to say that's East
Tennessee State University I want to learn more about it. Many institutions
are looking at fee specification. So online fees, differential fees for
programs, and manner and mechanisms through which cost of instruction can be
recognized from the fee side of the equation given the fact that the funding
formula and its current iteration in the state of Tennessee does not recognize
the differential production costs for high-cost programs.
And then finally moving adult students through short-term courses. Many
universities across the country start semesters every week,
some have multiple starts for the semester throughout the fall, in the
spring. So the recognition that in order for institutions to meet the needs of
non-traditional students, we have to adjust the pace and tone of the academic
calendar. That pace and tone being geared to meet the needs of students rather
than traditional starting to fall, start in the spring. And then finally from an
academic perspective on revenue enhancement with new programs, new
programs with market potential, RN to BSN programs that are online, moving to
larger class sizes in space maximization rather than teaching an Intro to
American Government course, which I taught as an undergrad and I also taught
at Nashville State Tech with 30 students putting me in front of 300 students
providing support from a pedagogical perspective to help work with students
i.e. a smaller scale version of the MOOCs about thereby lowering the production
costs for the delivery of that instructional methodology. Focusing
on a completement agenda and then finally the Rio Salado model, I referenced that
earlier with multiple starts to the semester. I had the chance a number of
years ago to visit Rio Salado Community College in Phoenix. I was fascinated by
the structure of their academic year. They began a new semester every Monday. A
faculty member would be responsible for teaching a set number of students
throughout the fall semester, so as a faculty member it would be my
responsibility to teach a constant load of 40 students all fall. Some may start at the
beginning of the term, they complete the course mid-cycle, the students move at
their own pace with the recognition that they need to complete the course by the
fall, but they can take the course in six weeks, four weeks, two weeks, eight weeks,
12 weeks. As students come and go, I would have additional students join my course,
so I would be teaching 40 students at different points in time across that
curriculum but i would bear a constant load of 40 students for that class. And
then if that I had a load of five classes for the semester that would be
replicated for the other courses that i taught in my department.
Rio Salado realized significant and pronounced to exponential growth because
they brought products to market a public institution in a manner that meet the
needs of non-traditional students. So as you reflect upon calls that you receive
from members of the General Assembly, members of the Board of Regents, your
president and chief academic officers, chief fiscal officer and others to
examine ways to increase productivity, diminish cost, increase revenues, maximize
resources, the items that I've walk through here in this portion lecture give a very
quick glimpse of some of the things that are being articulated across the nation.
If you're interested in learning more about this, the Delta Cost project.
Jane Wellman and her staff have done a great deal of work on the production and
revenue side of the equation as well as those items that drive costs, Patrick
Kelly at the National Center for higher education management systems has also
done a lot of work in this area with his colleague Dennis Jones and there's a
rich stream of resources available on the Lumina website that allows you to
research case studies of institutions in which they have implemented efforts to
reduce costs and maximize revenues. so from Lumina to and NCHEMS to the Delta
Cost project, three resources that if you google and spend some time on their
website will allow you to dive with greater granularity into the topics
covered in this brief portion of the lecture. I'll be back to talk a little
bit about environmental challenges that we face in the academic domain. So I'll
pause and look forward to joining you here in the next section of the course.
Thanks.