By Dennis Barden
[The following is excerpted from Restoring Trust in Higher Education, edited by Aneil K. Mishra, PhD. (Praeger ABC-CLIO, 2017). Permission to post online for a limited period has been granted through Copyright Clearance Center. Read the full chapter by Dennis Barden, and our recent newsletter in which it was included.]
When my clients inevitably ask me the state of the market for chief executives in higher education, I always give the same answer — the market is de facto irrational for the simple reason that there are still people who want the job. Despite the difficulty of being the servant (leader) of many masters, the discomfort of living in a fish bowl, the stress of financial challenges, the pressures of fund raising, and the frustrations of shared governance, dedicated, accomplished people still seek to lead the enterprise.
Will they always? I think they will. People drawn to higher education tend to be idealists, compelled by the possibility of changing the trajectory of individual lives (through teaching) and societies (via research). They believe that they can change the world, and thus the vicissitudes of the journey are already built into their thinking. Not all who so aspire have the requisite skills and experience for leadership in these times, but those who do take their positions knowing that the going will be difficult and that success is far from guaranteed.
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Among the issues that divide constituents is the notion of running higher education institutions “like a business.” This infuriates faculty in particular. To many on the faculty, running the institution like a business means making decisions on the basis of consumer (i.e. student and parent) demand, essentially becoming vendors providing for their customers what is asked of them rather than what they themselves know to be in those customers’ best interests. Board members, most of whom are successful in the world of business, simply cannot understand that an organization that charges for its services can be so unresponsive to the marketplace, so stubbornly willful as to refuse to accommodate the hands that feed it.
There are all too many examples of how extreme these positions can be. The efforts of the University of Virginia’s Board of Regents to run off their president, Teresa Sullivan, is only the most notorious. Lesser known are little stories, like the one I heard from a client on the West Coast. It seems that an elected faculty representative to this institution’s board was sitting in a budget meeting. The group was struggling to match the revenue and expense sides of the ledger when the faculty rep spoke up. “Why do we have to have a balanced budget? We are a non-profit organization.” Clearly, the gap remains wide.
That gap will likely close, however. Already, institutions are being enormously more transparent with their budgeting processes, inviting faculty and other constituents into the conversation and challenging them to make difficult decisions regarding budget allocations, rightsizing programs and staffs, and articulating institutional priorities. This movement is likely to continue and may well accelerate. What is certain is that the CEO of the future will have to demonstrate sound business acumen…whether or not he or she ever uses the word “business.” The days of tuition increases that surpass the rate of inflation are likely over, at least for as far out as can be reasonably predicted.Cost containment will be the constant mantra in the board room. Institutions will be challenged to prioritize their programming on a regular basis, and most institutions will no longer be able to afford to be all things to all people, making the choice of what thing to be and to what people of central importance. The president will play a seminal role in this process and must bring to the table considerable working knowledge of higher education finance, budgeting, debt financing, bond rating, and financial regulation. This is the president or chancellor truly as chief executive officer.
Read the full chapter by Dennis Barden: The Next Generation of Higher Education Leaders