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A Collective Agreement on Efficiency in Public Higher Education

The views expressed are those of the author and do not necessarily reflect the views of ASPA as an organization.

By Kenyatta Lovett
January 13, 2015

Lovett janFor some time now, the public higher education policy arena has been flooded with ideas and debates on how to make institutions more affordable and accessible. To complicate matters, there is an additional public focus on student success – retention and completion.

On the academic side, the industry has been inundated with initiatives centered on speed-to-completion strategies, with some evidence of success. The cost-reduction efforts for administration currently have few options available beyond budget cuts, outsourcing or consolidation, many of which are not sustainable strategies. The time has come to advance the conversation on efficiency in higher education by adopting new metrics and standards of institutional performance that incorporate academic and administrative values, in a transparent way that makes the industry better.

The Association of Governing Boards, in collaboration with the Lumina Foundation, offers an interesting perspective on efficiency. It includes values present in academia and administration. More important, their approach to creating a framework for efficiency in higher education highlights the transformation needed among policy and decision makers to embrace a different perspective on performance.

This shift in thinking is not much different from the leap from Ptolemy’s view to that of Copernicus. The adjustments in discerning reality and knowledge in this new context are, in many ways, just as tumultuous for higher education. There is no doubt some resistance to quantifying the service of higher education exists among faculty and administrators. Yet, the anomalies continue to grow in number and justify a review of how we measure cost and performance in higher education.

Much of the internal hesitation to include measures of efficiency and administrative performance centers on concerns for poorly justified reductions in funding which place limits on access, or a catastrophic degradation of the core mission of higher education. And indeed, the risk is present for these unfortunate outcomes, if the plan for these new standards is poorly constructed. The opportunities, if planned well, I believe can produce great benefits to the industry.

Innovation Validated Through Efficiency

Innovation is a central component of the national completion agenda. Across this nation, institutions are venturing off into new territory academically and operationally. Success, as recognized by the industry, centers on a handful of student performance metrics – grade improvements, pass rates, retention rates and graduation rates. While any institutions would welcome improvements in these student success areas, the devilish details often illustrate a different story.

Innovation based on existing academic metrics often becomes less beneficial to other institutions when the factors of cost and resources are added to the equation. A one-to-one student-teacher ratio is ideal in most cases, but highly improbable for many obvious reasons. The same story of grade improvement success or a dramatic increase in retention rates presented through a comprehensive lens of efficiency would not only remove the operational mystery, but also allow institutions the opportunity to better compare the circumstances on their campus to the situation of the originator of this innovation. The impact of student success metrics may waiver when bundled with standard measures of efficiency, but the value increases when justified with factors impacting the bottom line.

Examining Investment and Resource Allocation

In alignment with my first point, a common understanding of efficiency has the potential to go beyond examining the global usefulness of local innovation. Standards for efficiency can also offer comparative benefits to decision makers as it relates to resource allocation. Comparisons on performance have typically been limited to a small subset of metrics in higher education.

Yet, all institutions are generally made up of similar operational components. The perspective of efficiency offers a chance to examine cost and resource allocation based on key functions central to all institutions, viewed through the lens of transaction costs to achieve a desired outcome. The presence and openness of this comparison can shed new light on the collective administrative problem.

For many, this new framework could aid in identifying areas where there is too little, or too much, resource-investment in certain areas central to the institution’s mission. Legislators and decision makers would also have new tools to begin constructive conversations regarding higher forms of efficiency beyond budget cuts or consolidation. In turn, administrators would have some guidance on the realistic opportunities for efficiency improvement, given the evidence demonstrated by peer institutions based on a common framework.

The need for higher education efficiency standards, in part, centers on allowing the various stakeholders to better understand and help reverse the trend of rising costs. Before we can benefit from a more transparent view of the performance of administration in higher education, we must first develop the language necessary to construct useful dialogue. The pressure point appears to be common across the public higher education domain. A collective effort to create standards of efficiency is a useful and symbolic way to embrace an opportunity for all to become better, for the sake of our students and our missions.

Author: Kenyatta Lovett is an adjunct professor at Tennessee State University’s College of Public Service and Urban Affairs.

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The American Society for Public Administration is the largest and most prominent professional association for public administration. It is dedicated to advancing the art, science, teaching and practice of public and non-profit administration.

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