Road Too Little Traveled
Early on, as the financial markets spiraled down and unemployment surged, some commentators argued that the national environment would provide the impetus to effect serious change in higher education. After all, they reasoned, campus stakeholders understood the seriousness of the events around them as massive layoffs were occurring, 403(b) funds were being reduced to 203(b)s and it was universally understood that no job on campus was safe, potentially even faculty jobs.
As a variety of troubling conditions became almost simultaneously woven together, it appeared as though a sea change for institutions was inevitable -- a perfect storm for change was developing over higher education. The economic downturn and associated collateral damage created urgency for all stakeholders to come together in a more politically civilized environment to invoke major shifts in how the academy operates as an organization and as a learning community.
However, generally absent from cost containment and revenue sustainability decisions are cost reallocation decisions regarding the relevance and viability of the academic portfolio. The extent to which institutions explore the financial performance, market demand and mission impact of academic programs (e.g., programs, concentrations, courses, sections) across the program portfolio is largely unknown. It is unclear if institutions have a structured process, access to the data and reporting mechanisms to inform review of programs and, subsequently, if they have the capacity to make decisions to retire/eliminate programs.
Given the significant resources allocated to academic programs, the time many programs have been in existence, and the changing market place and challenging economic conditions, a rigorous, objective review is a reasonable and necessary part of an institution’s due diligence. However, these decisions may be the most challenging of all.
Even in the face of unprecedented financial challenge, are the traditions, political forces, mission arguments and ideological posturing within the academy trumping the ability to restructure the academic portfolio, and the decision making and resource allocation structures that currently exist? Or, alternatively, is the eye of the storm of such magnitude that this level of macro change will be deferred until stimulus funding evaporates and there is a public moratorium on tuition and fee increases?
Perhaps for some regions, major restructuring will occur only when the reality of large declines in the high school pipeline make their way into annual operating budgets, and community colleges begin cannibalizing enrollments from neighboring four-year institutions.
A Case Illustration
Consider a view of the national academic program portfolio. In 2007, higher education produced 2,189,315 degrees in total across 1,079 fields of study. The distribution of degree conferrals across fields of study varies greatly, ranging from 0 to 218,212. Despite the volume of degrees conferred annually, focused on an extensive variety of fields of study, it is a reasonable assumption that not all of these programs possess either the recent historic evidence or market opportunity to support their continuation.
For illustration purposes, review the set of program viability metrics below. These are real data points of an academic program currently offered by an accredited institution. Enrollments have not grown over the past 5 years, degrees conferred have declined by 20.5 percent, projected employment of graduates in this field within the State is relatively static through 2014 and the regional competitive landscape is saturated with similar programs, as seen in the table below:
|Has enrollment for this specific program grown at the institution?||No||Enrollment for the program has witnessed 0 growth from 2004-2007 with 17 degrees conferred during each of those years.|
|Nationally, have conferrals in this or similar degrees grown?||No||From 2002 to 2007, bachelor’s degrees conferred nationally in this field declined from 468 to 372 degrees, or a 20.5% decrease.|
|Regionally, are relevant occupations for graduates of this degree expected to increase?||No||Employment of graduates in this State is low and growth is expected to remain static. Specifically, employment is expected to increase minimally from 99 in 2004 to 122 occupations in 2014.|
|Nationally, are relevant occupations for graduates of this degree expected to increase?||No||Employment prospects for this field will remain relatively static at a 3.7% growth rate from 2006-2016 (or 1,000 jobs dispersed nationally) with no (0) expected annual average job openings due to growth and net replacements.|
|Is there a strong market opportunity for this degree program?||No||There are 12 regional competitors offering a similar bachelor’s degree.|
Institutional leaders can use this type of analysis to make difficult, but evidence-based, decisions. There are, of course, other variables that should be considered in this context. For example, is the program directly aligned with the institution’s mission and strategic plan, and/or does it support the goals of a liberal arts education? However, a decision to maintain the program will be made based on a review of a more comprehensive set of program metrics, including projected market demand.
Adopting a Portfolio Review Process
An academic portfolio review process differs from the traditional internal review process. The internal review often focuses on such academic program elements as student achievement and learning outcomes, course scheduling, strengths of faculty, course/adviser workload and resource utilization. The review of the academic portfolio is focused on sustainability, market relevance, and viability of programs moving forward.
The results of a regular and systematic academic program viability review can help institutions creatively address a number of key challenges. As institutions identify emerging program growth areas, many have a severely restricted capacity to add new programs -- new programs that make sense in the context of emerging/evolving fields, occupations and sectors such as sustainability, energy and the health sciences. However, absent grant awards and major gifts from donors, these and other necessary new programs will not have access to the significant capital to both launch and sustain them over time.
Beyond new program development, there are also competing needs for resources to improve student retention and success; advising and mentoring, faculty enrichment, assessment, and focused student support resources. The academic resource pool should be dynamic and fluid. Programs that might be missed but are no longer necessary or relevant (based on market demand, financial performance, competitive landscape, quality, etc.) should have their resources repurposed for emerging needs or opportunities. The tradition of adding programs without changing the base is simply no longer feasible.
So, to what extent are institutions engaged in a systematic and regular evaluation of its academic program portfolio? Consider the following set of questions as an entry point to such a process:
1. If a program has neither the demand (marginal or declining enrollments) nor the market for its graduates, what other factors or rationale is used to support the program’s continuance?
2. To what extent are academic offerings directly aligned with the vision, mission and strategic objectives of your institution’s priorities? If a program is not financially viable but is clearly aligned with the mission of the institution, can the institution afford to have that program subsidized by other financially viable programs?
4. What impact does the competitive landscape for a program have on the institution’s capacity to successfully recruit students, retain faculty and sustain resources to make the program viable in the long term?
5. Do the characteristics of the program lend itself to an alternative delivery mode such as online learning?
6. If analysis suggests that a program is not financially viable, is without a market and is not mission critical, consider how those instructional, program and physical space resources could be re-tasked to address emerging needs or other mission-specific needs of the institution.
There is no question that this is a challenging area to address. There can be strong arguments to maintain programs even if those programs are not directly reflected in present or future market demand or are financially neutral. It may be that they are “untouchable” due to the core values and commitment to a broad based education. But it seems implausible to think this can be the case for all academic programs.
Creating a program viability assessment culture that objectively organizes the metrics for market demand, financial performance, mission impact and program quality appears a necessary part of institutional due diligence, especially during these economic times.
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