Over the past decade, we have witnessed the closure of several small private institutions and a year does not pass when Moody’s highlights the tenuous fiscal outlook of many small private colleges. Changing student demographics resulting in a decreasing population of traditionally-aged college students coupled with ever increasing competition among institutions has resulted in smaller enrollment cohorts. Naturally increasing operational outlays added to the growing number of unfunded mandates results in ever accumulating institutional expenses. Many institutions feel pressured to increase tuition discount rates to attract more students yielding additional and growing financial concerns. Given these fiscal realities, it is no wonder that there is public policy concern about the closure of small private institutions.
In my thirty-year career in higher education, I have experienced several periods of market realignment and institutional retrenchments. I would not have anticipated the closure of small private institutions, but the reality of these closures highlights the urgent need for consistent administrative and operational success. I have always viewed organizational success as an outcome that is integrally linked to the identification and adaptation of internal and external environmental factors. Given the closure of some small private institutions and the potential for more, one must ask if there are organizational characteristics that can foster success?
Innovation Leadership is required for institutional survival. Innovation leadership is the ability of a leader to foster a culture of problem-solving and critical thinking focused on creatively addressing organization needs that lead to positive outcomes. An institution that does not have a culture and commitment to smart change will not succeed. Gone are the days when there is time to implement a new strategy and wait to evaluate if that strategy is successful. Quickly changing environmental factors have dictated that planning intervals and required organizational response times have decreased from decades to months. An institution and its leadership must think critically about change and implement strategies that are immediately effective. This type of innovation leadership requires a comprehensive and coordinated institutional response to identified needs and problems, a process that many higher education institutions are not successful at implementing.
It’s not about a leader; it is about leadership. Collaboration and collegiality are paramount to institutional success. The model where a singular leader speaks for, and implements, all change in an institution will not lead to organizational success. I am a strong believer that the greatest source of innovation and change in an organization is present in the people of that organization. If a small private institution of higher education is to survive in this perilous environment, it will be successful because everyone in the institution works to achieve the stated educational outcomes. While this success strategy sounds simplistic, it is often difficult to enact within an organization. There are natural organizational tensions that prevent divisions from engaging in effective collaboration, plus there are always personality differences that hinder collaboration. The president of a small private college must work to foster an environment where every leader and manager in the school is focused on achieving the highest possible level of collaboration and collegiality.
Small private colleges can succeed in the current environment. Fiscal demise is not a certain outcome. However, the success of the small private college will require open and innovative institutional leadership. Institutional stakeholders and governing boards need to be aware that fostering a collegial, collaborative, and innovative culture within an organization is essential to the success of a college. A continuous and open dialog between all stakeholders will help encourage this success.
Originally published on LinkedIn on December 6, 2015.
©2015 Kenneth Clough