We hear much regarding the crises facing higher education today – tumbling enrollments, changing student demographics, increasing institutional costs, the even greater increase in costs to students and the exponential rise in student debt, the challenges occasioned by increasingly influential rankings, the declining interest in the humanities and liberal arts, the rise in market-capturing online programming, and much more. And we hear much about the suffering of the small, mostly private, mostly stand-alone institution. But what we do not hear enough about is the important opportunities present – on both sides of the negotiation table.
What the current environment has begun to achieve, albeit slowly, is to encourage college and university executives and governing boards to begin to think beyond the usual strategies of enrollment management, enhanced campus amenities, tuition and fee discounting, and expanded online programming and adult learning. More and more executives and board members are beginning to consider how a strategic partnership, possibly including a merger (sometimes termed consolidation or acquisition depending on perspective), may be the best tactic to achieve growth, sustainability, and success – for both the institution and students.
Why should institutional leaders consider a merger now? Because, paraphrasing Churchill, “Never let a good crisis go to waste”. As the pressures on many institutions rise, the opportunities also increase.
For example, some colleges or universities may want to expand their geographic or market footprint by partnering or merging with an institution that is already located in the area or community of interest.
Or some schools may want to develop programs in law, health sciences, or manufacturing. What better way to do so rapidly than to merge with a school that is already offering such programs? Especially, considering the many specialized schools throughout the nation.
Or some institutions may want to expand their degree portfolio, adding bachelors, masters, or doctorates, by merging with a school that already offers these degrees. Or, alternatively, a school may want to gain a secure base of undergraduates. What better way to do so than merging with a two-year college?
And still other institutions may seek future sustainability, ensuring that their mission is continued and students are served, albeit perhaps in a modified manner.
Yes, it is a time of opportunity. But a few things should be kept in mind.
First, institutions should not wait too long, particularly if they are seeking greater sustainability. Opportunities should be explored, deliberately and with resolve, when the institutions are still in good financial and political state.
Second, institutions should be strategic. While opportunism is often the leading guide to strategic partnerships, we believe that is best for institutional leaders to have clarity around the strategic tactics that are most fitting to their institutions. And which should guide their search for a strategic partner.
Third, institutional leaders should remember to put their ego in their pocket. These partnerships are not about them. They are about the school and its future. And most importantly, they are about the students. So, when in doubt, ask what would be best for the students? Today and in the future?
So, are you and your institution making the most of this time of opportunity?
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Writer: Ricardo Azziz, Principal, SPH Consulting Group.
© SPH Consulting Group 2023