Have Your Class - and Afford it, Too!
In just a few short weeks, your incoming first year class will arrive! Congratulations are in order to all the institutions that are looking at full enrollment with the right mix of students. Enrolling the desired class is no small accomplishment in the current climate with:
- Congressional and state scrutiny of college costs;
- Increased financial aid grants awarded by many highly selective institutions;
- Challenges in the student loan industry;
- A slowing national economy;
- Global competition for U.S. students;
- Dramatically increased waitlist activity;
- Impending student demographic shifts; and
- The advent of the first $200,000 undergraduate college degree.
There is no doubt that enrolling a sufficient number of students to meet revenue goals – let alone crafting a first year class on various dimensions of desirability – is more difficult than ever before. And it’s even more difficult for all but the wealthiest institutions in the country to actually afford the class they enroll even if they do reach all their various goals such as gender balance, diversity, increase in student quality, and geographic representation. For many, it’s been a long, hot summer of uncertainty.
So how can chief enrollment officers and their teams contend with the current circumstances and still enroll the class they envision? In our collective experience, it requires a holistic, data-driven approach. Below, we offer four recommendations to those who are looking forward and planning for fall 2009 and beyond.
- Set your goals for 2009 now.
At Maguire Associates, we advise our clients to build their first year classes based on both their goals and an evaluation of viable scenarios, rather than run the risk that their classes will just “happen” to them each fall. These days, managing enrollment is a matter of intentional, sophisticated design rather than annual inevitability. We also advise our clients to start their planning process as early as possible. For example, how many students does your institution want to enroll in Fall 2009? 2010? 2011? In what geographic and socioeconomic breakdown? In what qualities are you especially interested? How much revenue does your institution need from tuition?
An important part of planning is setting realistic and affordable enrollment goals. Many institutions want to increase enrollment, diversity, and academic quality, lower their discount rate, admit fewer students, and bring in significantly more tuition revenue — all within one year. These goals, while often achievable in the long term, create inherent conflicts in the short term. Trying to accomplish too much too fast can result in unintended consequences. Institutions may find themselves in more jeopardy than before if they attempt to meet unrealistic goals.
So, we stress early internal dialogues, clear prioritization, and understanding of the tradeoffs required to achieve the institution's highest priorities. One rule of thumb is that enrollment of any group of students not typically represented in your “bread & butter” population will cost more money to attract and therefore decrease revenue. Expanding beyond your traditional audience is not only difficult, it’s nearly always expensive, especially if you try to rush the process.
- Plan backwards.
Much like creating a good mystery novel, crafting a class in challenging times is best done in reverse order. Start from your enrollment goals and work backwards. For example, a certain number of enrolled students require a certain number of admitted students. A certain number of admitted students requires a certain number of applicants. The number of applicants depends, in large part, on the number of inquirers. Inquirers come from a base of prospects, which requires a certain volume of name acquisition.
That said, it’s about the composition as much as it is about volume. For example, if you wish to increase the number of men, students from California, or bassoon players in your enrolled class, you must find and recruit these students in sufficient quantity and quality into your applicant pool so that you can admit them. The planning process starts years before – at the initial name-acquisition stage – when a deliberate cultivation process should begin. Often, institutions are unable to achieve enrollment goals because they have not cultivated enough interest among target groups to be able to admit them in sufficient numbers. Starting with multiple, concrete benchmarks that define success – for specific profiles of prospects, inquirers, applicants, and admitted students – can make "reach" goals achievable.
- Mine your data.
Information culled from institutional data is the most valuable tool you can use in planning for and enrolling the optimal class. However, data points that exist on your campus are essentially useless until they are turned into usable, actionable information. This transformation – from data to information and insight – is not an easy one, but it is always worth the investment of your time and effort.
Actionable information will immediately guide decisions, strategies, and tactics needed to enroll the students you want on your campus in 2009, 2010, and beyond. Enrollment managers who commit time and resources to extracting and taking full advantage of the value at their fingertips almost always come out with a net gain in the end. Unfortunately, on many campuses, data are plentiful, but actionable information is scarce. Make data analysis and research an institutional priority.
- Take a hard look at your financial aid awarding strategy.
If you didn’t achieve your enrollment goals this year, chances are that your financial aid awarding strategy is in need of some attention. Is your institution using the same financial aid awarding scheme (from matrix awarding, percentage of need met by institutional grant, specific scholarship levels, etc.) that it did in 2004 (or even 2005 or 2006)? If the answer is yes, then the strategy that drives your institutionally awarded dollars may not be as effective as it once was. The dynamics of student choices and the responses of many institutions have changed significantly over the past several years.
In fact, admitted student behaviors shift every year, necessitating annual adjustments to your financial aid awarding. This does not mean that you have to award more and more money in institutional grants and scholarships each year. Instead, we advise that institutions reallocate the financial aid budget so that it optimally incentivizes the students they most want to attract and enroll. Quite frequently, institutions actually over-award sub-groups of students, providing far more incentive than needed to enroll those students, often due to limited flexibility in the institution's awarding structure. Over-awarding, in turn, reduces net revenue and constrains award offers to other desirable student sub-groups.
With a carefully crafted approach, institutionally-funded grants and scholarships can enhance your class and boost your institution’s bottom line. If that is not happening, it’s probably time to find out why.