Higher Education institutions have been challenged over the past years with slowing enrollments. In addition to the economy issues, trends affecting Higher Education include:
- Government concluding it can no longer afford to subsidize universities
- A technological revolution challenging its business model
- Recognition of the responsibility for training and retraining workers throughout their careers
Identifying Key Performance Indicators are key to addressing these trends and preparing institutions for near-term and beyond.
KPIs: A Review
As mentioned in my July blog post on the subject, Key Performance Indicators (KPIs) represent a set of measures focusing on those aspects of organizational performance that are the most critical for the current and future success of the organization. KPIs should be measured frequently and tie directly to the success of an organization. They should include components that address the following:
- Actual results of the indicator
- Target what the indicator is striving for
- Differences between actual results and target results
- Signal values or benchmarks
However, as Higher Educational institutions prepare for the future they are facing trends that Susan Fitzgerald of Moody’s, a credit-rating agency, foresees as a “death spiral” of closures. Impacting these institutions the most are the “Demands for value in return for tuition dollars, compelling higher education to package their courses and services into a menu of convenience, efficiency and comfortable, predictable outcomes.” Therefore the most crucial KPIs that institutions need to focus on involve:
- Keeping costs down for prospective students
- Keeping graduation rates high
- Making job placement more predictable
The College Scorecard
The U.S. Department of Education has developed a tool entitled the College Scorecard that provides prospective students the ability to analyze their options in order to decide their return on tuition. It provides different parameters to search for colleges. When it displays the result it lists:
- Costs associated with attending that institution
- How that college ranks among other colleges
- Graduation rates and how the college ranks (low to high)
- Loan default rate of the institution compared to the national average
- Employment, or the types of jobs students who graduated from the institution were able to secure (this feature is to come)
With the outlook bleak and tools being provided by the government to help students choose wisely, it is important that Higher Education institutions have the ability to move the KPI dials in the right direction. The new transparency and accountability required by the federal and state government are forcing institutions to treat the student as a client with the ability to compare criteria just like any other commodity or service.
Such changes to the Higher Education landscape will require an extensive review of the institution’s existing KPIs to ensure they align to the way students will select the college of their choice. Through these KPIs, an institution must prove the value through return on tuition with an outcome that meets students’ short and long term goals. Institutions should implement their KPI strategy now to understand the levers that will need to be adjusted to attract students in the future.