In light of the COVID-19 reality, some of the questions Presidents, CFOs, Vice Presidents and Cabinets are asking are: “Do we entrench, hunker down, even retreat a bit and try to conserve cash? Do we mark time, ride out the storm and wait to get through it? Or do we step out, try to advance and even grow during tough times like these?
What is the state of your institution? Have you started paring down or cutting your budgets? Are you laying off staff? Has your Board asked you to do the same or more with less?
These are especially good questions for the three departments that have revenue-producing responsibilities for your school: Marketing, Admissions and Advancement.
The Expense Line: One Approach to the Problem
The typical reaction of an organization during an economic crisis is to cut or freeze spending. I was just reading the titles of three articles just published by the Chronicle of Education:: The Hard Choices Presidents Will Have to Make, Will Corona Virus Close Your School For Good, and The Great Recession Was Bad for Higher Education. Corona Virus Could Be Worse. I must confess since I’m not a premium subscriber, I’ve not read the full articles. However, I did read the teasers on the cover of the first article in which the author appears to present: provide tuition refunds, provide room and board refunds, draw down endowment principle, implement furloughs, lay off staff, and cut benefits.
The Revenue Line: An Alternate Approach
The one thing these writings have in common is they all deal with the middle lines of the financial statements that the C-Suite and Boards of colleges and universities will evaluate in the coming months and maybe years. My question is, who is monitoring the top revenue line of the same financials? Particularly the institution's Net Tuition Revenue. Yes, we can all agree that’s probably the VP of Enrollment, which is a good place to start, but it can’t end there. I would argue the President and CFO need to spend as much time looking at their institution's top line as they do their middle expense lines. As a result, in the midst of the inevitable cuts, if they can find money to invest in enrollment-increasing initiatives, they can get return on their investment, which has obvious cascading effects on morale and growth. It's a bold and transformational leadership move.
"The fastest and cheapest way to increase your enrollment is to invest in sales training for your Admissions Counselors."
- Rob Westervelt, George Fox University
Revenue Line Investment: How to Justify
You’ve probably all heard the pitch from a vendor who claims, “If our product/service helps you bring in at least x-number more student(s) you will have more than covered the cost of our product/service”. However, according to Rob Westervelt, EVP of Strategy and former EVP of Enrollment & Marketing for George Fox University (GFU) “The fastest and cheapest way to increase your enrollment is to invest in sales training for your Admissions Counselors.” Further, Rob asks, “Why is it that we invest tens and hundreds of thousands of dollars on marketing (top of the funnel) our institution and zero on training and equipping our Admissions Counselors (bottom of the funnel)? These are the very people that have the most influence on a prospective student and those influencing their enrollment decision.”
He and other leaders, both public and at private institutions, realized a minimum of 5 to 10 times ROI by investing in a professional development program for their Admissions staff, which included our Enrollment Methodology. Additionally, the resulting Counselor earned increased the average staff tenure (which saves money in the long-run) and contributed to a highly beneficial career culture.
The Proof Is In the Pudding
George Fox University (GFU) was facing budget cuts and possible layoffs a little over 6 years ago. Within three years they avoided both and moved from a $2M deficit to a $65M surplus. In a webinar titled: Thoughtful Innovation and Deliberate Change in Turbulent Times, Dr. Robin Baker, President, and Rob Westervelt, EVP of Strategy and former EVP of Enrollment and Marketing, share how their institution achieved six record Freshman classes and increased the average yield of their Admissions Counselors from 78 to 144 enrolled students in the same three years.
If you’re interested in exploring actionable, revenue-increasing initiatives for your institution, Value Based is sponsoring a webinar titled: Coronavirus Response For Enrollment Leadership - 12 Marketing & Admissions Initiatives on Tuesday, April 21st at 11:00 AM (PT) / 2:00 PM (ET). I hope you can join us.
- Jim Allen, Author/President, Value Based