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A forum for discussing issues in Independent School governance in the third decade of the 21st Century

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School Sustainability

5/10/2013

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I read with sadness this week that the pre-school that has traditionally been a feeder for my former school in Bermuda had announced that it was closing its doors for good this June. Among the reasons cited for its demise was the fact that over the past few years, my former school had attracted more and more of its students (and if truth be known many of its best staff) and consequently it was no longer financially sustainable. After my guilt subsided (having been the principal architect of its enrolment drain down the hill to my campus) I thought about the fragility of many of our schools. As I said to my Board a number of years ago, it's not the major financial crises that sink schools, but rather the slow attrition caused by a series of relatively minor setbacks.

A major fiduciary responsibility of Boards of Governors is to ensure the on-going sustainability of the school. Some Boards engage in stop-gap measures such as "strategic downsizing" (a euphemism for declining enrolments) or "financial restructuring" (increasing debt load) but the real challenge is to put in place those measures that set the school up for success and then measure how well it is meeting its targets. High performing Boards (and their Heads) have well-established and actively monitored key performance indicators on such significant markers as: enrolment trends; inquiry/application/acceptance ratios; faculty and staff turnover; pupil/teacher ratios; and pupil/admin ratios. These numbers are often a window on the health of the school. 

For example, if your number of inquiries is high (hits on your website, visitors to open houses, phone calls and tours, etc.) but your number of actual applicants is low, then you know that you have a competitiveness problem. Potential families are looking at you but choosing someone else. If you have a declining number of applicants and yet a consistent level of acceptances and admissions, then you have a standards problem. Stable numbers can often hide the fact that the school is accepting students whom would have been turned down in previous years. This might result in short-term financial stability but will definitely mean long-term decline in quality of programme, community reputation, and eventually, student numbers.

A sobering trend in independent schools in both Canada and the United States over the past 10 years has been an increase in the number of professional staff disproportionate to the growth in enrolments. The number of employees in independent schools has increased at double the growth rate of the student population while class sizes have remained constant. Who are all of these new employees? Part of it is an increase in service: counsellors, human resources personnel; communications/IT staff; etc. However, much of it is due to two other upward pressures. To begin with, as schools cast a wider net to find students, they begin to accept individuals who need a higher level of service (ESL, Learning Resource, educational assistants). The cost of these employees often more than cancels out the tuition revenues of the students whom they serve. Secondly, many independent schools are bucking the trend of the corporate sector by actually subdividing administrative responsibilities and adding new positions of responsibility rather than consolidating and streamlining. Boards often get too focused on the level of administrative salaries while ignoring radically rising administrative costs due to a creeping growth in the infrastructure. 

So what can you do as a Board to ensure that your school is sustainable? In my next post I will discuss some key questions that Governors need to ask and predictive trends to consider when reviewing school performance.


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    Author

    Dr. Jim Christopher
    has been working with Boards and Heads on Governance issues for the past 15 years. He is a former Superintendent of Schools, ED of the Canadian Association of Independent Schools and Canadian Educational Standards Institute and is the author of a number of books and articles of education and governance. His latest book, Beyond the Manual: A Realist's Guide to Independent School Governance is available on iTunes or at https://www.smashwords.com/books/view/388729

    View my profile on LinkedIn
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