Ricardo Azziz has held quite a few govt positions in greater training and led the merger that resulted in Georgia Regents College, now Augusta College. He’s principal at Strategic Partnerships in Larger Training, or SPH, Consulting Group.
He writes the regular Merger Watch opinion series on company restructuring in greater training.
Headlines typically refer to schools and universities as taking one kind of motion or one other — say “University of the Arts land $8.3M in bids for 2 buildings,” or “Gannon University and Ursuline College announce official merger deal.” But schools are inanimate.
We ought to be clear — institutional choices aren’t taken by inanimate objects. They’re made by the school or college’s leaders, after variable intervals of reflection, information gathering and dialogue. Nevertheless, the necessity for tight headlines typically underemphasizes the worth and important nature of management in figuring out the long run — in greater training and past.
The upper training panorama is altering quickly, and usually not for the higher. Consequently, extra institutional leaders might want to contemplate what different greater training specialists and I have termed “Big Scary Change,” i.e., mergers, acquisitions, closures, company conversions and main strategic partnerships. Not surprisingly, in a previous analysis my coauthors and I recognized a “dedicated and understanding governing board” and the “proper management” because the No. 1 and No. 2 key components, respectively, of upper training merger success.
Ricardo Azziz
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My crew and I work carefully with these devoted — and infrequently rightfully anxious —leaders, together with faculty and college chief executives and their boards, as they contemplate and navigate the uneven waters of “Large Scary Change.” This work leads me to need three needs for greater training leaders in 2025, specifically that they:
- Be disposed to accepting the information.
- Be prepared to discover all strategic choices.
- Be agreeable to accepting exterior assist.
First, accepting the information could sound apparent. However I’ve witnessed a lot magical pondering in govt workplaces and boardrooms in schools and universities throughout the nation.
If an establishment’s enrollment has been declining constantly for a decade or extra, maybe with total full-time equivalents falling greater than 35% throughout that point, then anticipating that development to vary within the close to future and return to ranges noticed in 2013 is just unrealistic.
If an establishment has been constantly working a deficit whereas leveraging market good points in its endowment and the occasional unrestricted philanthropic present to steadiness the finances, then anticipating this development to immediately reverse displays a level of magical pondering.
Keep in mind additionally that merely evaluating the numbers of 1 12 months to the subsequent may be terribly deceptive. Essential tendencies can solely be acknowledged when not less than eight to 10 years of knowledge is reviewed. But too typically govt leaders and their groups are sometimes unable or worse, unwilling, to current this information to their boards.
Whereas magical realism can work properly in literature, it typically works poorly when planning for the operational and monetary realities of a faculty or college. As writer Jim Collins reminds us in his ebook “Good to Nice,” efficient leaders have to be prepared — and search — to face the brutal information.
Second, institutional leaders ought to be prepared to discover all strategic choices. Nevertheless, to discover all strategic choices, institutional leaders should possess three attributes: They will need to have the mandatory experience, be prepared to dedicate the mandatory time, and be capable of actively search the information required to satisfy the challenges dealing with greater training.
To successfully discover all strategic choices, greater training leaders — together with chief executives and their groups, and the governing boards that they reply to — should undertake common and intensive strategic planning. At minimal, they need to do that on a yearly foundation.
With the monetary, market, demographic and regulatory surroundings altering quickly, boards and govt groups have to be prepared to speed up the pace at which they keep on prime of rising tendencies.
Larger training leaders ought to be reminded of the quip attributed to the late Jack Welch, former CEO of Normal Electrical: “If the speed of change on the surface exceeds the speed of change on the within, the tip is close to.”
Exploring strategic choices in an everyday and well timed method additionally calls for being prepared to grasp all strategic choices — not simply those who nibble on the edges of the issue, just like the myriad of techniques marketed to extend enrollments, model recognition, tutorial choices and value slicing.
Larger training leaders must also intentionally purpose to grasp the place and function of main restructuring alternatives, together with mergers, acquisitions and even deliberate closures.
Understanding the facility, alternative and challenges of those main restructuring occasions (i.e., Large Scary Change) doesn’t imply institutional leaders must in the end pursue the choice. However the train will allow them to be extra aware of, and fewer anxious about, contemplating these main restructuring occasions if wanted. In the long run, greater training leaders ought to remember the fact that markets with massive excess capacity, rising costs and reducing demand over the long run are ripe for consolidation.
Third, greater training leaders have to be extra prepared to just accept exterior knowledgeable help. Whereas it could come throughout as self-serving contemplating the companies my firm gives, the truth is that endeavor — and even contemplating — main restructuring occasions, equivalent to a merger or deliberate closure, is just not one thing that the majority greater training leaders have really finished earlier than.
Faculty leaders shouldn’t underappreciate the complexities and nuances of those occasions, both when exploring them, or when really negotiating and implementing them. Additional, leaders ought to acknowledge their restricted bandwidth to deal with the numerous actions required to make sure an initiative’s success, notably since in addition they must proceed to give attention to managing their establishments as very best.
Whereas conserving heritage and historical past alive in a merger requires cautious planning, doing so in a closure — even a deliberate one — is troublesome. It’s then my hope and want for 2025 that faculty and college leaders will heed the recommendation I’ve laid out — and achieve this earlier than they lose all remaining model, monetary and enrollment property that make them a pretty accomplice, or earlier than they miss out on potential alternatives to quickly improve their aggressive energy.
