Originally published: “Leadership and Community in Tumultuous Times“, Inside Higher Ed , Month 24, 2020.
Susan Resneck Pierce advises presidents and boards on how they should respond to the myriad challenges and dislocations caused by the coronavirus pandemicby Susan Resneck Pierce
Those of us who were college presidents on Sept. 11 understood that our larger society would be changed in significant ways. But even as we all feared an unknown future, including possible new terrorist attacks, we nevertheless sought to help our campuses both mourn the victims of that horrendous act and come together even more deliberately as a community. Simply put, we sought to enhance our connections with one another. Although we worried about our short-term financial health, I think that most of us were not concerned about the survival of our institution or of other colleges and universities.
The coronavirus is a far more significant inflection point, as our sense of community is being shattered. Students sent away from their campuses and scattered over the country and even the world are understandably distressed at losing their connection to one another and to faculty and staff. Many faculty members are struggling with the demands of teaching online for the first time. Some faculty and many staff members worry that they will lose their jobs. Some already have. A number of colleges and universities fear that they will not survive financially.
The fact is that higher education institutions are contending with daunting challenges and forces over which they have little if any control. Endowments are rapidly losing their value. Unless the market makes a huge and reasonably immediate rebound, colleges are going to have a problem going forward funding financial aid and operations that depend both on endowment income and also on tuition, room and board.
Tuition, room and board revenues will also go down if enrollments decline further, as they very well may continue to do. The huge downturn in the stock market will inevitably affect the choices of many students and their families going forward. For a number of years, we have recognized that the sticker price for tuition has discouraged many students from applying to or enrolling in the higher education institutions of their choice. We have also seen the perceived value of higher ed come under serious attack. Families who are experiencing a dramatic shrinkage of the money that they put aside for college will inevitably rethink what they can afford.
Most institutions will be hard put to provide additional financial aid to compensate for the diminished ability of families to afford tuition at its current levels. With an average tuition discount of 52 percent nationally, and many institutions discounting much more than that, some colleges and universities are already failing to earn sufficient net tuition revenue. I know of way too many institutions that already have unsustainable annual structural deficits in the millions — and even some with deficits in the tens of millions.
There is also evidence that growing numbers of future and even current students will choose to attend colleges close to home or want to live at home. A senior administrator at one of the nation’s most selective colleges tells me that it is receiving an unprecedented number of transcript requests with notes from students saying that they love the institution but want to be closer to their family in the future.
In this time of enrollment uncertainty, many institutions will be even more reluctant to make tenure-track appointments. Some institutions are already extending the tenure clock in an effort to support tenure-track faculty. Others may postpone tenure decisions for a year as a wait-and-see tactic so that they can better determine their staffing needs going forward. And even greater numbers of adjuncts will confront increasingly precarious employment situations.
ACT and SAT are postponing tests, and that will create havoc in terms of the timing of admissions decisions unless additional institutions go test optional immediately — which won’t make parents of high-testing students happy. It will also require a new thinking about admission standards on the part of institutions that have previously continued to value standardized tests.
Lots of places don’t have the technological capability or faculty expertise/experience to teach online courses effectively. (I wonder how many students encountering ineffective online courses will decide to transfer to online universities that they believe know how to do it better.) Some institutions are viewing the new reliance on online learning as an opportunity and are planning to expand their online offerings. Moving to online courses has also led some campuses to switch to pass-fail grading, which may affect how graduate programs and employers make choices. At the same time, some students are returning to homes that don’t have sufficient or any Wi-Fi capability. Nor can they rely on local libraries, which generally are closed.
And of course, fixed costs are fixed costs. For example, even if fewer students enroll and/or live on the campus, colleges will still have to maintain buildings and pay the debt service on those for which they borrowed.
So what should boards and presidents do in response to all this? As a starting point, I suggest the following:
- With the president’s involvement, the board chair should create a crisis response committee of some of the board’s most strategic-minded trustees, including some with financial expertise, to work with the president and the finance staff to project the economic implications of various scenarios. Depending on when groups can congregate again and when the campus can reopen, this committee needs to consider such factors as enrollments, the numbers of students living on campus and fundraising. For example, they will need to make a recommendation to the entire board about the level of endowment payout, which itself will depend on what happens with their endowment over the coming months. If appropriate, they will need to review bank covenants. They will need to make decisions about moving forward on pending capital projects and other major new investments. They should work with the audit/risk committee of the board to discern any other unusual risks. Members of this crisis response committee will need to determine the various financial runways for the institution depending on which scenarios prevail and make the decisions, such as employment decisions, that these circumstances call for. Everyone involved will also need to be nimble, as it is likely that many institutions will not have a clear understanding of their fall enrollments until classes have actually begun again, and fundraising is likely to remain uncertain for at least the near term.
- Presidents and key trustees should work with senior staff to determine how, if at all possible, to continue to pay and provide benefits for employees and, if that is not possible, to determine how the institution might best help those it must lay off. This latter response won’t be easy financially, but it will be an ethical one.
- Under all circumstances, presidents and other campus leaders should do everything possible to sustain a sense of community. They should make it a priority to send regular communications providing as much information as possible to students, faculty, staff, trustees, alumni and appropriate members of the larger community. Faculty members are meeting with their classes online but might want to set up ongoing chat rooms for students to talk with one another outside class. They might want to schedule book clubs or meetings on current topics. The staff might encourage leaders of student organizations to form video or audio chat groups with regular meeting times. Institutions that are canceling commencement ceremonies might try to create a virtual commencement complete with a compelling commencement speaker and, yes, even the playing of “Pomp and Circumstance.”
- Presidents need to create additional teams, some populated with those with expertise in specific areas (e.g., enrollment, financial aid, fundraising or facilities) and others that might include faculty, staff, students and trustees to do scenario planning for as many possible circumstances as they can imagine. Ultimately, they would make recommendations to the president, who would, in turn, recommend any strategic, policy or significant budget matters to the board. Teams might also devote themselves to considering the impact on admissions, on hiring, on campus services and on how courses will be taught under various circumstances.
- More than at any other time, trustees need to set a philanthropic example — something that may be difficult for some in light of what is probably happening to their own financial portfolios. They also, more than ever, need to be ambassadors not only for the institutions that they serve but for higher education in general. For example, they might follow the advice of the American Council on Education and other higher education associations to ask Congress to support students and institutions in this time of crisis. They might write op-ed pieces explaining the value of a college education or volunteer to help recruiting students by making calls and hosting events.
- The advancement team might reach out, as some institutions already have, to alumni to provide support for students from low-income families who might not be able to go home if their campus has closed, as well as for additional financial aid for students for the fall.
- The academic vice president or provost should work with the faculty to develop contingency plans for curricular offerings and any new hiring for the fall.
- Institutions might make it clear to current students that if they should choose next semester or next year to attend a college closer to home, they would always be welcome to return later without having to reapply.
- Campuses in line for accreditation visits should consult with those organizations immediately to consider a new schedule.
- Finally, in the event of the truly unhappy reality that some institutions will no longer have the financial means to remain open, the board and president need to fairly quickly make a series of truly devastating decisions: when to notify the campus community, whether a partnership or merger with another institution is possible in such a short time frame, what severance faculty and staff will receive, how to provide teach-outs to current students, what to do with the campus, and what to do with any remaining endowment. The closing of a college campus, as we all know, is traumatic. Arriving at this place abruptly and in today’s current economic climate will be even more so.
I began this piece talking about community. Sadly, in recent years, our larger society has experienced a breakdown of community that has also become manifest on some of our campuses. In this difficult time in which we are required to be physically separated from colleagues, friends and even family, we nevertheless will need to work together in the best of faith so that we make the best decisions we can for our students and institutions.
In good times, our colleges and universities have been wonderful examples of diverse and effective learning communities dedicated to producing educated citizens who will make a difference in the world. In this worst of times, we must continue to do just that.