Sunday, July 12, 2009

Why Analytics and Lifting Out of Recession?

We are launching this blog to discuss three simple theses:

  • A new generation of “action analytics” is emerging in higher education.
  • The current recession requires both immediate, severe cutbacks/adjustments and longer-term innovation and reinvention of higher education.
  • Lifting out of recession in a manner that sustains higher education’s competitive advantage will require re-imagining our policies, processes, practices, performance, and value propositions for the post-recession global economy. Analytics will be critical to our success.

Premise #1: A new generation of analytic capabilities is emerging in higher education. These analytics are driven by two factors: 1) the skyrocketing demands for accountability by higher education’s publics – an issue that will be at the forefront of re-imagining institutions, and 2) the proliferation of Web 2.0 tools and practices. Some practitioners refer to these new practices as business intelligence, higher education informatics, or performance measurement and improvement. We prefer the term, Action Analytics ®, to describe the next generation of analytics practices, so powerful that they don’t just enable action, they demand it.

In the article, “Action Analytics: Measuring and Improving Performance That Matter in Higher Education”. EDUCAUSE Review, Jan/Feb 2008, my colleagues Linda Baer, Joan Leonard, Lou Pugliese, Paul Lefrere, and I described the elements of open-architecture enabled action analytics - :

  • The capacity to extract data from a wide range of internal and external data sources – administrative ERP, academic information systems, assessment, alignment, and external information sources – enabling greater cross-institutional/cross-sector analysis;
  • Loosely-coupled data, information, reporting, and analytics capabilities combining data marts/warehouses, ETL, OLAP, BI and data mining/predictive modeling capabilities with assessment management/alignment tools and other niche applications; and
  • A presentation and visualization layer consisting of a range of tools like dashboards, scorecards, portals, portfolio, data libraries/data books, and other visualization tools – more advanced and sophisticated than today’s.

The new generation of analytics will not be broadly distributed, overnight. Technology is just part of the issue. Building organizational analytics capacity requires changing the behaviors of leaders, faculty, staff, students, and other stakeholders and reshaping institutional culture. Already underway before the recession, the emergence of a culture of performance improvement will accelerate. The need to establish financial sustainability demands it.

Premise #2: The current recession is hammering high education in a way that requires both immediate cutbacks and longer-term innovations/reinventions of many aspects of higher education. Higher education’s pain is caused by a perfect storm of financial woes: reductions in state appropriations for public institutions, dramatic reductions in investments, most impactful on private institutions, and traumatic declines in the capacity of parents and students to pay for higher education, today and continuing into the future. The affordability crisis will likely accelerate even after the economy improves.

We are all familiar with the short-term adjustments pummeling campuses today: financial rescissions, short-term fixes, competing for and leveraging stimulus money, lay-offs, furloughs, pay cuts, creative approaches to financial aid, continuing to increase tuition to fill the gaps, compressing the time for an undergraduate degree from four (or more) to three years, and enrollment shifts to less-expensive institutions. In the short-run, financial exigency seems to be trumping innovation. But campus financial officers know that budgetary challenges in 2-3 years may be even more harsh when stimulus money is gone. Moreover, demands for transparency and accountability are growing. In years two, three, and beyond, institutions will need to pursue a mixed strategy of operation efficiency, innovation, reimagining, and new revenues to reclaim financial sustainability.

In the literature on responding to recession, writers from other industries emphasize innovation and preparing to compete in the post-recession economy. Higher education must do the same.

We are assembling examples of institutions responding to these imperatives with efficiencies, innovations, and reinventions – many of which will be shaped by analytics. Their cases will tell the story of survival and reinvention.

Premise #3: In order to lift out of recession, higher education needs to increase its use of analytics. Analytics will incease both internally and externally. Institutional leaders must discover and demonstrate improvements in operational efficiency and leverage innovation and re-imagination of programs and services. Action analytics will prove critical to improving and demonstrating the value proposition for high education.

Comparative measures of access, convenience and affordability (total time and cost of education), and success (completion, employment, satisfaction with outcomes and experiences) are emerging. The public will eventually demand these measures – and greater transparency from most institutions. Options for accelerated completion, greater convenience, and programs tailored to workforce needs will be valued. The availability of these programs will be broadly publicized.

Higher education is not alone in being under the microscope of public scrutiny. Virtually every industry is striving to reinvent its practices tio deal with the challenge of global competitiveness, post-recession: financial services, real estate, manufacturing, agriculture, retail, energy, transportation, and health care. In particular, our national competitiveness depends on health care and education reimagining themselves. Health care is being pressed to reduce costs, improve health outcomes, eliminate disparities in access to health care and outcomes, and practice evidence-based medicine. PK-20 education is facing expectations to remake itself in fundamental ways: halt the escalating total cost of education for individuals and families, increase the educational attainment of the population, reduce remediation and improve success rates, improve educational outcomes and provide evidence of their attainment, and provide the fexibility and choice needed by diverse populations of learners at all stages of life and careers.

Our goal is to blog on tales of analytics, lifting out of recession, and the intersecting of the two. Primarily in higher education, but also in other industries that can be illustrative. Stay tuned for more from the front lines of evidence-based, re-imagined practices. Please join the discussion and share insights, offer examples and best practices, and debate how higher education can emerge from this recession in a position to thrive.

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