The Survival of Small Private Colleges

This is Future youe with Jeff Salingo and Michael Horn.

Welcome to Future youe. I'm Michael Horne, joined by my colleague Jeff Salingo. And we have a very special guest on today's episode, President Helen Drynan of Simmons University, the eighth president of Simmons, who's been there since 2008, really credited for turning around the university, which we get to talk about, and turning it from a college into a university. President Drynan, thanks so much for joining us.

You're welcome, Michael.

A question we love to ask our guests when they first come on is not about their current job, but how did they get into higher education to begin with? So I'd love to hear your story about how you got into this field.

Okay. So I'm an accidental college president, without question. I have a strong background in human resources and I have moved through a number of jobs in that regard. I was the executive vice president of human resources at a bank, Boston Corporation, a local, very successful organization. Then I was president of the Society for Human Resource Management, which is the largest human resource organization in the world. And I came back to Boston and was head of HR for a health care organization. And when I came back to Boston, I joined the board at Simmons, very sort of spur of the moment to fill a position that was vacated by a classmate of mine. And long story short, I kind of fell in love with Simmons again. I have two master's degrees from Simmons and was asked to join the board permanently and was asked to chair the board and then as chair was asked to be temporary present when our then president left unexpectedly. So it was definitely an accidental presidency.

So, President Drynan, we heard in the last couple of weeks and months here in the, in the Boston area, a lot of small private colleges are really struggling. Mount Ida Newberry News recently that Hampshire is looking for strategic partners to kind of continue on do the small private college, particularly in New England, where there is an overabundance of them, it seems, given the population growth now in this region, how can they compete in this hyper competitive landscape?

Well, I think one of the key things is solid finances. And I think that financial management in higher education has not been a key competency that has been sought in most presidents. So I think lots of times the realities of the income and the outflow have been missed until it's really a very drastic situation. So I think upticking that expertise in higher education is very important. I think the other issue is being realistic about how distinctive you are. Everyone wants to say that they're excellent at this or providing a well rounded education at that. But you really have to look at why are people coming here and not going somewhere else in a way that is really defensible, that is differentiated, and that doesn't happen just by reading about it. I think you have to do real, genuine market research to get that. So I think there's a lot of business skills in running colleges and universities that have not been especially strong. I think that's one big area. I do think you're right. There's a concentration of higher education in New England. And unfortunately, the demographics are going in the wrong direction for New England. And we know that kids go to school relatively close to home. They don't necessarily. Everybody doesn't go across the country. So it's a very definite issue. I think every school that is, especially those of us who are tuition sensitive and modestly endowed, have to be looking at how do we develop alternative revenue sources. And again, that's a business skill. So there's a lot of skills now being required to deal with big problems that are occurring in higher education.

So as you think of Simmons, like, what did you do that, for example, Mount Ida. And I'm not trying to have you compare the two, but any of these small private colleges, but Mount Ida I picked because it's only, what, eight, nine miles down the road. That's right. Rode from you. What did you do that put you in the position you are today, which is not one of these small, struggling colleges?

Right. So we were one of these small, struggling colleges when I got to Simmons in 2008. And really good for us that the whole rest of the world was preoccupied with the Great Recession in 2008 and 9. And we didn't stand out like a sore thumb. But we had serious problems. We couldn't meet payroll. The day that I arrived at Simmons, really, we didn't have the money to finish what is now our newest building in the rear of our campus. Because we'd spent that money. Lehman Brothers failed and they held all of our swaps. It went on and on and on, and we had to act rapidly. We did not have any choice. So we had to do things like significantly reduce the budget and we had to lay people off, which in higher education is. It's news when you see anybody laying off two or three or 10 people. We laid off 73 people. So it's a lot of stress. Again, I was grateful I had the experience to say, I know what we have to do, but that's just survival. And as soon as you survive, you have to be looking at how are we going to move to a place where we're not fighting for survival every single year? What's our class? How are we going to make budget? So we moved pretty quickly to strategy and really worked hard on a very focused strategy. And again, in higher education, a lot of strategy is about being as excellent as you can be. Really not being very clear about what do we have to do that differentiates us. And we picked two things, really two specific things. One was to decide how we were going to differentiate our undergraduate program, which as an all women's undergraduate program, as you probably are aware, is one of the hardest recruits in the country. So what are we going to do about this program to say I want to be there. In spite of the fact that it's women's education, I want to be there. And the second thing was, what can we do to capitalize on this wonderful history? We have a vibrant, well developed on the ground graduate professional education programs that we could not break out of New England to market. So we were basically saying they're great programs, they have wonderful reputations, they compete at a national level, but we have no market beyond New England because people had to come to Simmons to get those degrees. And if you're commuting from Maine three nights a week, that's about all you can do. And so we, at the time, it was 2010, 11, we said, we have to look at online education. And you'll recall that that was not exactly the heyday of online education. And people were very afraid we were going to ruin our reputation, become another University of Phoenix. And yet we said, you know, we've got to explore this. So we did what you would call in the larger world a skunk works project. We tried it ourselves and we picked a discipline that was not one of our well known disciplines. So if it didn't work exactly the way we wanted to, we weren't putting one our big programs online. And it didn't work the way we would hope. The thing we learned is that a school of our size could never at that juncture, ever spend the kind of marketing dollars and invest in the kind of technology dollars that we needed to get really out there into the marketplace. So we attracted great students, but only a handful of them. You can't make a program on that. And during that period of time, we were lucky enough to make a partnership with the organization called 2U. And they re approached us, having once approached us when they had a business model that was one discipline per institution, that was their original business model. And they approached us at that time and decided they were looking at us for library and information science and decided not to offer that program. So they stepped back. Then they came back to us not too long afterwards and said, we're rethinking our business model. We can't possibly take all the students that are interested in online education if we stick to one institution per discipline. And we'd like to know about your interest in nursing. Well, nursing is one of the things we are most well known for. And so within three months, we made an agreement. We'd had enough knowledge with that Skunk works efforts to say, we can do this. We just need a partner to help us with the marketing and the technology. So it was just such an opportunity and it really made the strategy real.

I'm really curious because I think a lot of colleges or universities in your position, having done a pilot themselves, having seen it not go well, would you say, throw up their hand, say, it's not for me. It seems you were very careful about learning specific lessons from it, but you didn't change the vision that online was going to be important. Can you talk about that ability to do that on a campus and then tell her, tell, tell our listeners how it's gone?

Yes. So one of the things I think is really important is to view failure as a learning opportunity, not as a disaster where everybody gets discouraged. And I will say there was a lot of worry about that. If we fail, how will that look to people inside the community as well as outside the community? And from the beginning we said we really need to exploit online. So we've got to keep pushing and not give up if it doesn't work the first time. I will say, based on that first time experience, we knew that it wasn't. We can't just keep repeating this kind of an experience. It has to be decidedly different. So that partnership opportunity was key to this. I will also say that has sent a message to the organization that failure is not fatal. You don't lose your job over failure. And I think that's been very important. Nobody's ever lost their job over trying to do something that's interesting, that we think is a good idea. And I think that message is a very important one. There was still reluctance. There's no question about going online big scale. But again, we were fortunate that nursing was our first undertaking because our nurses had such an incredibly practical orientation to this. Their orientation was, we're going to produce more nurse practitioners than we possibly can on the ground. And this country has a huge shortage of primary care across the country. And this is a big answer to that solution.

So, huge answer.

So they're working on mission. I mean, that's really what drove it. And we started in 2014, we started that program and we made $4 million in the first year. And this year we'll be making about $80 million in online revenues. Now, that's not just nursing. About a year and a half after the nurses got going, TU approached us about offering our social work program. So we have to say our social work professors talked to our nursing professors and got the word that this was a great thing, it wasn't a bad thing. And so it became a little contagious. And then 2U approached us about putting a group of small programs online in addition to two big ones. So we've experimented with that. Of the five programs we put online, four have not succeeded, one has. But there, again, our view is, okay, what did we learn from that? We learned from that that it's always best for us if we have a substantial program on the ground before we take it online. That's just always best for us. The second thing is we have to be willing to invest in a program and hold it. If it's a small program, we can't decide after two years that it isn't doing what we want it to do. So again, we've learned from that. And now we're thinking about one more program, which is a big program we have going on partnership with 2U. Again, so it's sort of continuous learning and continuously saying, okay, the principles of this are evolving, but they're pretty clear about what's good for us and what's not.

So on the other side of the equation, on the women's college side and the undergrad experience, what did you do there to really differentiate that and continue to be able to draw students?

Totally different approach. We hired a great firm, I think, art and science, that helps you to analyze your differentiated position in the marketplace. And again, you know, for a college that's struggling financially, they are the sort of high price spread, if you will. But we just decided this is such an important problem. We need to engage the people we think have the greatest capacity to solve the problem. And they helped us through an entire entire sequence of admissions and really helped us to think about what is there going to say about Simmons that is going to make it different from all the other opportunities students have. And we came up with a number of things. First thing was revise the curriculum. It's not robust Enough. General education curricula are pretty much across the nation what they have been for a long time. So change the gen ed curriculum, make it far more robust. Find a way to frame the undergraduate curriculum that has continuity from first through senior years. So an experience that follows the student through those four years. Add into the curriculum these high impact practices that are tried and true or becoming to be tried and true. Things like learning communities, things like great big problems to solve outside the university and then finally to make certain that every student has an opportunity to participate in this coherent experience which we based on the curriculum of the city of Boston. We said we've got to capitalize on being in this city. We can't just say we reside here. The curriculum's got to be premised on the city of Boston.

Could one of these strategies have worked without the other? In other words, if you didn't get the revenue that you were getting from online, could you have done what you did with the undergraduate experience?

If we were only undergraduates, then obviously we would have done the only undergraduates. The way I think the two strategies are linked and the way we thought about them at the beginning was we can't do what we're trying to do at the undergraduate level with the finances that we have. We need to increase our finances. And our big opportunity was graduate professional education. So graduate professional education funds a lot of what we're trying to do at the undergraduate while funding its own self improvement because it's now the single largest source of revenue we have. The undergraduate program and the on the ground revenue as two separate categories are kind of neck and neck with online education far and away the most dominant revenue source.

So that's the alternative revenue source.

That's right.

And so I guess the question as I'm listening to you here is that every small college is looking for. Well, not every, every college is looking for alternative revenue sources. But thinking about your category of institutions, how transferable is your experience? Like if every small college did what you did, you know, everybody would be online.

Right.

And I don't think that's sustainable. Right. So how transferable is your experience to other small colleges?

So you can imagine many people have asked us that and I don't think it is transferable per se to many other colleges. There are other small universities that probably could do something like what we're doing, but we had early adopter advantage. If you look at the 2U partners list, we are the smallest by way judgment by size. We also have generally the lowest cost program. So we're the ones that are essentially helping a student that wants to get into the field get a great degree for a less, less going into debt and high price tag opportunities. So being an early adopter was huge for us. What I would say is transferable is the, is the discipline of those strategic thinking. Because, for example, it's taught us to be always looking at what we're doing and saying, huh, is that an opportunity to do something that there might be a market for? So, for example, we had a leadership conference that we've been running for this will be our 40th year. It was started by alumni, it was pretty small, and it grew to be a good sized leadership conference, but it was basically break even or worse. We were subsidizing it in order to run it. And I gave the charge to our head of marketing at the time to figure out how we made this into a surplus generating operation. And we now make over a million dollars on that conference which we use to supplement graduate scholarships. So I think it's, you know, it's really saying, okay, what are we doing that there's an opportunity to do something else with? And right now we're thinking about that conference in a bigger way where it's basically saying, okay, so we've made this work. Could the conference be the connection to other things we could do in the leadership arena? And so I think it's the strategic thinking that could be reapplied. And I often think when I listen to stories about other colleges, I think that's an opportunity for them.

Well, President Drynan, thank you so much for joining us today on Future youe. We really appreciate it and we'll be right back.

This episode of Future youe was made possible with support from the Academy for Innovative Higher Education Leadership. The Academy is a partnership between Arizona State University and Georgetown University and is the premier training ground for those who aspire to senior leadership positions in higher education and those who want to lead organizational change at colleges and universities in the future. This episode was also made possible with support from Entangled Solutions. If you want to shape the future of education, Entangled Solutions would like to hear from you. Entangled Solutions is hiring smart, mission driven team members interested in helping world class institutions solve their most vexing challenges in learning and education. Learn more at Entangled Solutions

and welcome back to Future youe. I'm Jeff Salingo with my co host Michael Horn and we just had President Drainan on from Simmons University. A fascinating conversation given what's happening in the rest of the New England and Boston area. And particular. And that last question, Michael, I asked her about what's transferable from her experience because obviously online has been a big boost to them and that may not be transferable to every institution. In what you heard from Simmons, what do you think is transferable? What can other small colleges and leaders of other small colleges draw from this?

Yeah. So I took away three things, I think, from what she said. One was the importance of stepping back and having strategic thinking about what are our opportunities. And that that bleeds into number two, which is having a clear sense of what differentiates you and stopping the higher ed race to be all things to all people and look like everyone else. And she, you know, they had very clear ideas. We have programs that are national caliber, but landlocked, in effect, by New England. That's a differentiator we can exploit, in effect, to bring in new revenue. And online was the medium. But the takeaway isn't about online in my. The takeaway is being clear about what's your differentiator and developing around that. And then the third thing that I took away from it was something that she hit very hard in the beginning around business skills in the leadership and financial management in particular. And it's just clear that higher ed has paid a lot of short shrift, at least in New England, but probably all over to this question. And I wrote that piece for Forbes a couple months back about will 50% of all colleges really close in the next decade or what Clay Christensen said? My conclusion was, no, but. But it's starting to happen. But it's going, but it's going that direction. And I think New England's going to be rough. And, and it's really my big contention in the article was everyone says, oh, Clay made this prediction because of disruptive innovation. That's not why he made the prediction. It was because the business model, the management of finances, revenue, keeping up with expenses is broken in a lot of these places. And that's what's happening. And so I thought. But I really took that from her. I mean, what did you take from it?

Well, the alternative revenue sources fascinates me because whenever you're talking to colleges that are kind of struggling on their balance sheet, a lot of them say, well, we can't really cut costs anymore, which I don't quite believe.

I was stunned by the way that she cut 73 people.

And most people, I think they can do it, they're just unwilling to do it. So everyone's looking for raising more revenue, but no one really knows where to look. And one of the things that she said in there, she was talking about that conference, for example, that they were putting on, you know, this opportunity, looking at everything with a new set of eyes and say, is there an opportunity to do something else? We're already doing this. Is there an opportunity to do something else? You know, I'm always reminded of Paul LeBlanc, when I first met him, telling me kind of how they started online at Southern New Hampshire, how they grew it to where it is today. And he talks about when he first got there. You know, he kind of was looking under every rock, and he said, hey, we were doing this online piece on the corner of campus. No one was really paying much attention to it, but I knew there was something there. And I think, again, it's this idea of looking across the board at a set of fresh eyes. And part of the problem, I think, with many of these small colleges is that a lot of the leadership, especially at the dean level and below, has kind of been there for a while. They've been doing things the same way all the time. And sometimes it does require a new president or a board to ask questions that haven't been asked before.

Yeah. And something I took from that. I mean, it's an entrepreneurial eye, right? It's an eye of. We have. I mean, colleges and universities are exciting places. There's a lot of neat things going around with incredible faculty members doing pioneering research, teaching, whatever, leadership programs and the like. Being able to look across that and say what's truly different and that we can use in some way that no one else has thought to, to fill some sort of need and drive revenue. The other thing that I. It made me think of, and I'm curious, your take on this, given the book you're working on around the admissions process, is the college asp of this being in New England with a declining population, the cliff about to happen. I'm just. I mean, I don't know that I have a question, except I'm curious. Your takeaways. They stuck to being a women's college. They did some very cool stuff about curriculum development. Does that move the needle for someone applying?

I think it moves the needle a little bit because you have to remember there's still a deeper pool here. She's right. Right. Most people go locally. The pool is shrinking here, but, you know, we still only have about. You know, I don't know what the rate is in New England, but. But we only have about 68% of American high school graduates go right on to college. So you still have 30% of the pool that you're not reaching. And they're hard to reach. Right. They're students with sometimes low SAT scores, sometimes not great high school grades, or more importantly, I think they're incredibly financially needy students. So these are students who historically have not been well served by higher education. And I think there is a path forward for some of these institutions to really go deeper into some of these communities and really transform lives in the way they haven't. I also think that they haven't before. I also think she talked a lot about the high impact practices which come out of AAC&U and George Q's research at Indiana University. And I think to me this is everyone's trying to do this, right? Everyone's trying to do undergraduate research and learning and living communities and hands on work. And I thought what was interesting about her was this Simmons approach is kind of like, okay, we're also in Boston. We're going to take advantage of that. It's not just saying we're going to take the list of high impact practices and we're going to put them in practice.

Right, right.

But we're going to have our own unique spin on it. And I think, you know, we see that out at Dominican University out in California with Mary Mara, you know, and others who are doing kind of interesting things. Mary Marcy, sorry, a friend of mine is Mary Mara. And so I think that what we need to do is I think more colleges need to look at these things with unique spins on those high impact practices.

Yeah, I think that makes a lot of sense and something one of my pet peeves in the world is the phrase best practices because that's an on average statement that doesn't apply to your circumstance. And so that really is what it says is learn from those practices, but then make them your own. And the other thing I was struck by in that making that own was the notion of having a continuous learning scope that wasn't just a hodgepodge of courses. Here's your Gen Ed, go into your major. But something that really connected the freshman experience all the way through senior year. It sounded a lot like what Minerva is doing in terms of reinventing the curriculum and having a clear arc to the curriculum. I just wrote a piece a little bit ago for Education Next around the power of storytelling as you create courses. And they're not thinking in terms of stories of courses. They're thinking about connective tissue and coherence of an overall scope and sequence of the overall curricular experience, which I think is powerful from developing a word of mouth. It's a longer term, I think thing in terms of building desirability of an institution. But for people going through it, I suspect it's a very powerful experience.

Michael, thinking about online education because you've written a lot about online over the years. Again, I think a lot of colleges are looking to that as their alternative revenue source. Are there other things though around for example credentialing or what are the other areas you think are potentially ripe hype? Maybe not to produce, you know, $80 million. Right. But. But can produce a million here and a million there that actually add up to real money afterwards.

Yeah. So. And, and I think I agree with the point. I think you're going toward which is online is much more saturated I think than people think it is. You really have to have a strong niche. From my perspective, I think credentialing is. Is an interesting one where you could not necessarily charge your existing students more because I don't know that that's going to pay off. But really developing assessments finely tuned with your, with your region so specific to your employers in your region, specific to the problems that matter that you can give credentials out on an assessment basis to people that aren't necessarily affiliated with a full time program in your community and make them effectively a Simmons alum of a small micro credential. That's one thing. I think that is certainly an aspect assessment in general to give credit for skills and experiences learned outside of higher ed. I think that's another opportunity to create revenues. And then the last thing I would say is partnering with employers not just in terms of developing degree programs but in terms of doing meaningful projects. And I suspect there's revenue streams that employers would be willing to pay colleges and universities around a whole range of activities from research specific to their industry to the students that were solving particular problems on the campus or excuse me, in the companies. And then third, the flip side of it obviously is placement of students into those institutions as well and actually training your current employees also. So I think there's a whole range of that that you can take your strengths and extend them out into a range of ways in the community.

Yeah. And I think one of the issues is that who does this at these small colleges? Right. These small colleges are, you know, they have pretty lean staffs and administrations and. Right. So you're just trying to keep the lights on every day. And now you have to also think about kind of forward. Right. I when I wrote the Chief Innovation Officer paper for Entangled last year, I was surprised by there's a couple of small, very small colleges that had officers, chief innovation officers, who were kind of responsible for kind of this business development as you're, as you're, as you're talking about it. So a lot to talk about. We'll be bringing up the idea of small colleges again in the future, but many thanks to, to President Drynan for joining us on today's episode and sharing her thoughts on the future of small private colleges and undergraduate education, especially for women. And thanks for tuning in and be sure to rate us on itunes or wherever you get your podcasts.