The strategic enrollment planning imperative for colleges and universities

Last fall, Doug Lederman at Inside Higher Education wrote, “It’s official: Higher education is shrinking, for the first time in at least 15 years. Total enrollment at American colleges and universities eligible for federal financial aid fell slightly in the fall of 2011 from the year before, according to preliminary data released Tuesday by the U.S. Education Department’s National Center for Education Statistics. The data from the department’s Integrated Postsecondary Education Data System show that 21,554,004 students were enrolled in fall 2011, down from 21,588,124 in fall 2010. While that drop is smaller than two-tenths of one percent, it is the first such dip since at least 1996, according to officials at NCES.”

Just this week, the National Center for Education Statistics released its Projections of Education Statistics to 2021, which forecasts higher education enrollments will increase a mere 15 percent between 2010 and 2021. That represents a projected compounded annual growth rate of 1.25 percent. To put that figure in perspective, higher education grew at a compounded annual rate of 3.52 percent between fall 1996 and fall 2010.

With these projections in mind, there is little doubt that enrollment growth will slow over the next decade. Furthermore, demographic shifts will lead to regional variations in these enrollment projections, with the Northeast and Upper Midwest particularly hard hit. These demographic shifts indicate that the traditional student cohort is becoming more ethnically diverse, less able to pay for college, and less prepared for the rigors of post-secondary education.

Meanwhile, the traditional economic model for both public and private institutions is also changing. Slowing enrollment growth will impact institutions that have previously relied on growth to fund campus improvements and the expansion of academic and co-curricular programs. Shrinking state support is already forcing public institutions to rely increasingly on net tuition and fee revenue to fund operations. In a report on state higher education finances, SHEEO (State Higher Education Executive Officers Association) examined funding across all public institutions over a 25-year period. In 1985, net tuition revenue as a percentage of public higher education total revenue was 23 percent. By fall 2010, that figure had increased to 40 percent. Private colleges and universities, long dependent on net tuition revenue to finance the majority of their operations, are experiencing much slower growth in net tuition revenue per student as their discount rates increase in the wake of the financial crisis that began in 2008.

These conditions have significant, long-lasting implications for colleges and universities. However, they are not insurmountable if campuses take the appropriate steps to adapt to these new realities—especially if campuses make strategic enrollment planning an institutional priority.

Unfortunately, even if campuses already have a strategic enrollment planning (SEP) process, most are not satisfied with the results. According to a 2011 Noel-Levitz study, only 34 percent of four-year publics, 28 percent of four year privates, and 11 percent of two-year publics reported having a strategic enrollment plan that is of excellent or good quality. Many institutions also engage in SEP processes that are not guided by data, tracked through key metrics, or even very strategic.

At Noel-Levitz, we define strategic enrollment planning as a complex and organized effort to connect mission, current state, and a changing environment to long-term enrollment and fiscal health, resulting in a concrete, written plan of action. Importantly, we emphasize building robust data sets to inform the planning process, which typically proceeds according to the following eight phases:

1. Preparation
2. Identification of key performance indicators
3. Development of a comprehensive situation analysis (data compilation, research, the SEP dashboard)
4. Strategy identification
5. Action plan development (business plan for each potential strategy)
6. Strategy prioritization (mission-fit, ROI, likelihood of success)
7. Development of quantifiable goals and a funding strategy
8. Execution, evaluation, and modification

Because so many campuses struggle with the SEP process, my colleagues and I came together to produce a comprehensive book on the subject: Strategic Enrollment Planning: A Dynamic Collaboration. With chapters written by Noel-Levitz consultants and campus-based enrollment managers from across the country, it contains numerous organizational models, detailed strategies, tools, and case studies that should help you conduct an effective SEP process on your own campus.  Regardless of where you are in that process, I think you will find it a valuable resource.

I also welcome any questions you have about strategic enrollment planning. We have consulted with campuses of varying size, type, and mission, and while this is a complex process, it can be broken into manageable pieces. Send me an e-mail and I can suggest strategies for embarking on the strategic enrollment planning process, how it benefits your campus, and how you can demonstrate those benefits to encourage campus buy-in. I also invite you to explore this topic at our forthcoming Strategic Enrollment Planning Executive Forum this December.

Whatever you do, be sure you take action. The changes described above are likely to become more dramatic in the coming years, and the sooner you address them, the sooner you can chart a course to future stability and success for your campus.