Small College Struggles in the Sights

Heightened concern about liberal arts institutions is reflected in presidents’ outlooks and an institute program.

January 8, 2018
 

HOLLYWOOD, Fla. -- The Council of Independent Colleges has been among the most bullish organizations when discussing the state of small private liberal arts colleges, but a heightened sense of concern underpinned much of the organization's annual Presidents Institute this year.

The concern was evident in the institute's programming, which included a notable number of sessions addressing mergers or partnerships between institutions, as well as strategies for taking on financial challenges. It was also evident in this year's theme -- “Pathways to Excellence: Resilience and Innovation.” Institutions cannot be resilient if they are not faced with significant challenges, after all.

Numerous presidents at the institute agreed that they see an increased urgency among their peers interested in exploring significant changes in order to stabilize their colleges' standing or seek long-term viability. In a few cases, presidents pointed to a confluence of trends causing them to reconsider doing business as usual, such as a declining number of traditional high school graduates in their regions, increased financial pressures, stiffer competition from public institutions or the free public college movement.

More often, presidents reported having long been aware of headwinds. But their Boards of Trustees, alumni and faculty members have recently become more open to making significant changes, they said.

That openness has come as the challenges facing colleges and universities continue to gain prominence. Murmurs beginning with the closure and reopening of Sweet Briar College in Virginia have grown as that college has struggled to regain its footing. A spate of college closures announced last year was joined by news of a merger agreement between Wheelock College and Boston University. Other significant changes were announced, such as the move by Marygrove College in Detroit to eliminate undergraduate enrollment.

So the fact that small private colleges are under pressure is not new. The extent to which CIC -- an organization whose role is in part to advocate for small private colleges -- is addressing the pressures is new, however.

The difference between this year's program and last year's isn't black-and-white, said Richard Ekman, CIC president. He called it an “incremental shift in emphasis.” And there were many sessions that were not focused on addressing colleges' struggles.

Ekman also said he continues to be bullish on the future of the sector.

“We still only see a handful of colleges go out of business every year,” he said. “And we still think it's a pretty small number that are in very serious financial shape.”

To be sure, prior years' Presidents Institutes have featured several sessions geared toward addressing financial pressures or competing in a changing world. They included sessions on leading transformed colleges and on low-cost models. They have addressed strategic alliances and affordability.

Still, they did not grapple with change in the same way as this year's program, which included sessions on “Innovative Collaborations and Partnerships,” “Effective Strategies for Addressing Financial Challenges,” “Presidential Considerations for College Mergers and Acquisitions,” and several variations on innovation.

It was important to present a nuanced program about strategies for the future at a time when many wrongly assume all small, nonelite private institutions are in dire financial shape, Ekman said.

“We thought it was time to talk about all the new and good things that are going on that are truly responsive to educational and social issues in the context of resilient institutions,” he said.

Presenters who have been through merger processes offered a variety of perspectives on the positives and negatives.

Troy D. Hammond is the president of North Central College in Illinois, which recently acquired Shimer College. Every college will find itself in a different situation, he said. But his opinion is that institutions under the most financial pressure should consider having conversations about the future.

"I'm not saying that's the right answer," he said of mergers. "But if you want to do anything that's meaningful from the strategic standpoint for the long term, you want to do it from a position of strength."

Cynthia Zane is the president of Hilbert College, which in 2015 opted not to do a merger with St. Bonaventure University in upstate New York after more than a year of talks. She offered suggestions based on the experience.

Both sides of a potential merger should be clear up front on details, she said. Such details include what colleges' real estate assets are worth and what kind of expertise each institution's faculty has.

"Mergers rarely work if it's only about the money and the bottom line," Zane said. "Look at the complexity. You have to look at the nuances, about what value would it bring to a partner institution if they were to go into a strategic alliance with you. What value will it bring to students? What value will it bring to the faculty, the staff, to the community as a whole?"

James Martin, the former provost at Mount Ida College and co-author of the book Consolidating Colleges and Merging Universities, spoke at a session examining some of the nuts and bolts of mergers, partnerships and strategic alliances. He addressed the financial benefits of new business models, the ways new opportunities for joint fund-raising can be created and ways to turn the very real concerns of faculty and alumni into opportunities -- like joint academic programs and expanded alumni networks.

While presidential leadership on mergers is important, Martin said, sustained leadership from chief academic officers is crucial to any merger or partnership discussion.

"You have to have two chief academic officers that get going and carry weight," he said.

The idea of the program was to provide practical approaches, said Hal Hartley, CIC senior vice president.

“There's no one playbook that all colleges can use,” he said. “Let the presidents sort out what's going to work best for their institutions. I think that's why you hear so much buzz around the room.”

Not everyone is sure the buzz will translate into widespread mergers or other significant changes. The sheer number of constituencies at colleges -- students, alumni and trustees -- makes it hard to generate lasting momentum.

University of Charleston President Edwin H. Welch has heard that higher ed has been at a crisis or change point before. But he said colleges and universities still face the same negative inertia as they have in the past.

"I'm a skeptic," he said of the idea that significant changes are near. "But it would be nice if it's true."

Welch considers himself a change advocate who is not deterred by his skepticism. He pointed out that it's easy for institutions and leaders to change the way they talk, but it's much harder to change their cultures.

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