« Ten "No Consultant" Tips to Increase Retention »

This Executive Briefing was prepared exclusively for senior decision-makers. The perspective taken in this Briefing assumes the reader’s progressive organizational experience leading to a senior position in a college or university setting.

Our last Executive Briefing identified ten things adult-centered and professional programs can do to increase enrollments without hiring consultants. This Executive Briefing identifies ten things these programs can do for themselves to increase retention – the “sweet spot of convergence among higher education’s stakeholders.”

From a financial perspective, most programs would benefit from reallocating 12-18% of their enrollment budget to systematic retention activities . . . and the financial benefits are only the tip of the iceberg.

The suggestions you will read represent topics drawn from InterEd’s Executive Retreats. We would love to see you at a Retreat this summer but offer this as an alternative.

The following tips are those that we have seen successfully implemented in programs similar to yours. They are field-tested and you don’t need a consultant to implement them.

Sidebar on Consultants: Having worked in this arena for 25 years, we have seen countless enrollment and retention consultancies come and go. When it is time for consultative services, it is important that you choose carefully, not only with respect to the return on your investment, but with respect to the cultural fit between the proposed solution and your institution. If you have exhausted your DIY projects, ask me for an objective list of considerations in choosing a consulting firm.

Tip #1: Socialize the Benefits of Increased Retention

Most executives possess a decent grasp of the importance of retention to their institution. It helps to socialize this perspective in order to provide a broad and diverse base of support for the changes that will be necessary.

I have found it helpful to focus on a specific metric – retention-to-graduation (RTG) – rather than the more abstract idea of “retention.”

More than any other metric, retention-to-graduation defines the “sweet spot of convergence among the interests and values held by all stakeholders.”

Happy indeed are the academics (product delivered), the operations folks (fewest hassles and happiest customers), the financial team (maximum revenue/maximum margin), your executive team (integrated systems working well to achieve the mission), accreditors and regulators (RTG is central to the definition of a successful program), and stakeholders external to the system, such as employers. Perhaps the most satisfied of the stakeholders are the students themselves. Goal set . . . Goal Sought . . . Goal achieved!

A few more words about the financial stakeholders’ perspectives may be useful. On balance, aggregate delivery costs begin high, well into negative margin territory, and steadily decline over the matriculation cycle. Students who drop before the break-even point cost the institution money. Following is the result of a typical break-even analysis based on $2,250 learner acquisition cost, 30% unit level margin, and $475 per credit hour tuition.

Course	B/E Margin
1	($1,822.50)
2	($1,395.00)
3	($967.50)
4	($540.00)
5	($112.50)
6	$315.00
7	$742.50
8	$1,170.00
9	$1,597.50
10	$2,025.00

As can be seen, the typical break-even point for the typical adult-centered program is found between the fifth and sixth courses. NB: This model examines the cash flow for a single student. It does not include statistical drop rate projections. The actual break-even point using the above assumptions will be closer to the seventh course.

It is glib but correct to observe that you would have been better off paying the early dropping students $1,000 to attend another institution.

Many adult-centered programs believe their programs reach break-even more quickly than this but, upon inspection, we often find that they have allocated only a faction of their learner acquisition costs.

Another cause of failing to see the true break-even results is amortizing enrollment costs across the student’s matriculation life. We recommend expensing enrollment costs as they occur, managing the enterprise to the break-even point and then retention to graduation. Amortizing enrollment costs may make the initial books look better but it does nothing for real cash flow and is theoretically problematic in that one must revise the theoretical student life cycle to conform to actual drops. (If this explanation is too terse, ask me for an expanded version.)

Tip #2: Socialize the Risk of Failing to Retain Students

There are symmetrical and asymmetrical risks associated with the flip side of retention. Students who drop are adults who failed to realize an important goal. They are dissatisfied and perhaps more. They must allocate responsibility for their failure and the obvious targets are themselves and the school. Students who blame the institution for their failure, and many of them do, will actively discourage others from attending. The greater their dissatisfaction, the more likely they are to refer negatively.

In contrast, students whom you retain to graduation will refer positively and appropriately. You want these referrals because they convert at rates higher than any other lead source.

Tip #3: Develop an Approach Based On Critical Incident Theory

The history of the typical drop is a current events human interest story. On Thursday, after the third workshop in the second course, Joe has a vague feeling that he is in over his head. Joe’s classmates and study group seem to be doing better than he is. He is behind on his individual and group work. One of his study group members good-naturedly chided Joe for being late. Friday evening, Joe feels the need to study but his family is tugging at him to engage . . . same thing Saturday when his wife asks if he is going to be able to keep their weekly commitment to do something special together.

By Sunday morning – 2.5 days after the first thought of dropping – Joe has made the decision to drop and, under the typical institutional framework, you are still completely in the dark! You may have Joe in your “system” but you had no idea he was in trouble.

Tip #4: Embed Metrics Everywhere

Every facet of your post-enrollment system, including the pre-matriculation hand-off from the enrollment counselor, creates one or more opportunities for gathering retention-relevant metrics.

Generalization: If an artifact is created by or touches the student with the opportunity for a good or bad outcome, measure it.

Potential metrics areas include: the hand-off itself, easily gathered and managed data-points from instruction, metrics derived from the flow of data points, calendar and event-triggered metrics, and metrics gathered from systematic outbound touches.

Tip #5: Issue Real-time Reports

Most individuals in the supply chain have a role in retention. While instructors play a key role, often the most important, other roles can be important. The registrar, the bookstore, and every other functional area are responsible for performing on-time and in accordance with established standards. Metrics relevant to each functional area should be gathered and reported to the function’s constituents.

The reporting system should appreciate the fact that the elapsed time from at-risk student's first consideration of dropping, to the actual drop, is typically less than one week.

Tip #6: Create a Retention Counselor Role

Some of you will tell me that you have this role in place. But what does this person do? Do they sit at a desk waiting for someone to call or drop by or do they make dozens of scheduled and event triggered outbound email and telephone touches every day, managing a retention caseload of 450 or more students per counselor?

Having reviewed many job descriptions for retention counselors, the generalization is that most if not all are passive beyond the possibility of remedy. An effective retention counselor is a high-touch, high-relationship, outbound role in which several dozen students are touched daily at different levels, for different reasons, and via different communications modalities. Inbound work (i.e., direct requests for help) makes up 10-20% of the ideal role.

Tip #7: Build and Manage Relationships

If your retention counselor role waits for the call, retention will be what it will be. This traditional and passive approach to the role makes no material contribution to retention. Your RTG will increase substantially, however, if your retention counselor periodically touches every student in her caseload with the goal of establishing and maintaining a relationship with the student.

Q: How do you know if an effective relationship has been established?

Once a month, you place random phone calls to a dozen or so students. If a student knows the retention counselor's first name and knows the counselor's email and/or phone number, the counselor is effective in this role.

Q: Why is this metric the acid test of effectiveness?

Because the primary role of the retention counselor is to establish a relationship of sufficient quality that the at-risk student will reach out for help before dropping.

Tip #8: Compensate for Retention Success

When it comes to organizational culture, you get what you pay attention to and reward. No executive should expect increased RTG without accommodating this fact.

Happily, compensating for retention is not only more ethically sound than compensating good and bad performance equally, it is also relatively free of restraints from the Department of Education. However, there are details to be considered. Send me a note describing your circumstances if you would like additional guidance on this topic. We encourage performance-based compensation for all roles in the institution.

Tip #9: Don't Abuse Students

Irrespective of the nature of the metrics, reports, roles, and business rules you implement, you will benefit from an exhaustive examination of every facet of the supply chain to identify areas in which students are or might be abused by your system. Does the registrar’s office make “errand boys” out of students? Do departments insist on in-person advising requirements that are honored largely in the breach? Are appointments kept? When the student experiences a problem, who owns it? (The best way to answer this question is to ask who has the responsibility for making the next phone call or sending the next email.)

Do what you can to detect and eliminate these abuses. It is likely to improve RTG enough to be worth the effort. Additionally, the operational improvements may be worth the effort apart from improved retention.

Tip #10: Build a Suite of Retention Interventions

The concerns of some at-risk students will be resolved through informal counseling past the crisis. For some, at-risk students, it will be sufficient to learn that it is “normal” and perhaps expected that students will experience these feelings in the second or third course is enough to get past it. For other students, a short-course in time management will save the day. For yet others, learning how to use learning teams to work more efficiently and to help level variations in study load will be helpful. For a few at-risk students, a telephone or in-person conference with the student and his or her spouse may assist in reaching an effective resolution.

Improved Retention Is Only One Step Away

Rescuing a potential elective drop and transforming it into a successful graduation is a worthwhile goal that is best achieved through systematic processes supported by the right business rules. These tips will move you in the right direction.

Please Share

I am always interested in how individual programs improve their retention. Please share your experiences in the comments section below or send me an email. I will present additional tips as interest develops.

Robert W. Tucker is President and CEO of InterEd, Inc.

He can be reached through this forum.

The expression of other views by leaders in higher education is welcomed.