Creative Destruction: Recruiting and Enrollment in Higher Education
Why colleges who don’t make recruiting and enrolling students “Amazon-Easy,” will quickly go the way of Sears.
Each year when a new group of students enters into my class, Business and American Society, one of the first lessons they face involves the theory of Creative Destruction. Admittedly, I’ve twisted the term from its original meaning, but whether one follows Marx or Joseph Schumpeter, the main idea is that there are creative-destructive forces in all businesses and institutions. Whether one is an economist, historian, or biologist, the theory is easy to understand. Charles Darwin wrote in 1859 that “the extinction of old forms is the almost inevitable consequence of the production of new forms,” which is perhaps the most useful analogy of all. My favorite classroom mantra for aspiring entrepreneurs is that to be successful, you have to obsolete yourself. The problem is, obsoleting yourself is not easy. The stories of once-mighty corporations, NCR, RCA, and Sears, to name a few, are stories of companies with an inability to pivot or adapt. A few have made the leap, Proctor and Gamble’s brilliant move away from candle-making and into soap-making upon the invention of the lightbulb is one of my favorite examples, but most businesses do not — remember MySpace?
The continuing disruption in the higher education market is due to many factors, and to blame any single cause would be short-sighted. A declining population of high-school graduates, a shift towards adult learners, the devaluation of a liberal arts degrees, a growing demand for STEM and healthcare programs, the rise in online learning, and the expense of maintaining a state-of-the-art campus are just a few of the challenges that have thrown many colleges onto the dust heap of history. Despite the cacophony of problems, some still rise above — think Southern New Hampshire University (SNHU), Western Governors University (WGU), and Arizona State University (ASU) to name a few. While academicians and scholars proudly maintain the truism that biggest is not necessarily best, survival at any size is “kind of important” as one of my business students succinctly stated in a recent online assignment post.
While the challenges listed above are well-known, the social adaptation of technologies plays a significant role in student recruiting and enrollment, yet often goes unrecognized. Put more succinctly, society has turned to an instant-on model. In my history of business innovation classes, I’ve been saying that all interactions, from car insurance to merchandise, have to be “Amazon-Easy.” No longer can transactions be difficult or complicated — society always moves towards transactional streamlining. Sears became the number one retailer because of new systems and technologies, including rural route postal service and railroads. Online retailing obsoleted Sears when the website replaced the catalog and modern logistics allowed for deliveries in two days or less. Progressive Insurance, e-Trade, and LegalZoom were all disrupters, agents, brokers, and lawyers saw their long-established business models vanish and never saw it coming. If Schumpeter were alive today, he’d say “I told you so,” in his proud Austrian accent.
Historically, the little things usually go unnoticed by those who are about to be obsoleted. The release of the Model-T did not overtly threaten buggy-whip manufacturers at first, but we all know how that ended. What organizational history has taught us is that those who study and notice processes and trends usually come out ahead. Take the lowly transcript for example, all colleges require a returning student (think adult learners), to submit a transcript as part of the application process, this is a hassle for the applicant, especially if they’ve been out of school for a while. Southern New Hampshire University eliminated this hurdle with a customer service team that, for a $10 fee, will find your transcripts for you. I still talk to administrators who claim that this can’t be done, but SNHU is doing it, and their enrollment has gone from 10,000 to 90,000 in 10 years. Yes, I know that they are all online, don’t provide the college experience, and will never play Michigan in the national championship game — but they’ll be making payroll long after the traditional brick and mortar school next door has closed their doors.
Think about this for a minute — everyone reading this article except for perhaps a few Luddites — have ordered from Amazon, it’s just easy; click, order, wait a day, open package. We no longer need to mail bills, drive downtown, or pick up food. Uber and GrubHub are the transactional equivalents of in-house transcript sourcing. Even if you are old-school in your thinking, the students you need to attract are not. Today’s eighteen-year-olds were born into a world where the World Wide Web existed for ten years before their arrival. All of their transactions have been online, always — but online is not the most important part, its streamlined service. Waiting to jump through a hoop or fill out a form to drop in the mail is no longer acceptable, and if you think it is, I have a small liberal arts college in Vermont I’d like to sell you.
It’s not just transcripts. Financial aid, the little engine that keeps the business of higher education chugging along, is also made Amazon-Easy by the colleges that “get it.” Western Governors, for example, allows you to fill out and submit the FAFSA on their site and you can conditionally find out about your awards and any other federal grants within hours. Speaking of funding and waiting — what about waiting for the semester to begin? At WGU you can start many programs on the first of any month. While registrars nationwide struggle to balance academic calendars with student aid rules, some places have figured it out — I am no expert in this area, but go check out WGU’s website. I had a sales job once during my undergrad years, and I remember a Zig Ziglar style sales manager who said “close the sale before someone else does and always ask for the order,” say no more.
Along with the streamlining of old gothic-style college transactions, marketing and contact management is critical. Ever notice how many billboards there are for competing colleges placed on the way to other colleges? How about near large employers? One bad day at work and the number on the billboard is a lifeline to an adult student ready to get a new start. Social media and banner ads, targeted and persistent, are also effective. The schools previously mentioned also have a television presence, usually in the morning during the news to catch people getting ready for work. A quick check on a media tracker site showed that SNHU aired 6,857 commercials nationally in the past 30 days.
Once the prospect makes contact with recruiting, contact management is key. A colleague recently shared with me his experience enrolling in an online graduate program. One minute after he submitted his contact information requesting more information, his phone rang, and he spoke to a helpful enrollment staffer who answered all of his questions — no waiting — just like Prime. My son experienced similar service during his last year of high school when a recruiter from out of state came to his school and was available at the local Starbucks after school. All of his questions were answered, and he was receiving marketing materials online the same evening. Follow up was early and often with college visits scheduled seven days a week and personalized. If you don’t close the sale quickly, someone else will, period.
Before I start to be assailed by my coffeehouse cohort of humanities PhDs who may justly accuse me of being a sell-out capitalist reductionist, I understand that the schools I’ve referenced are not what we know as “traditional” and that they are mostly online. I will not engage in arguments about online versus face-to-face — I’ve taught in both modalities for quite some time, and I will hold on to my love for the sage on the stage as long as I can — but that’s not the point of this essay. I would also add that it’s not only the schools I’ve referenced in this narrative that are Amazon-Easy, a good number of other non-profit, regionally accredited, schools; including some large state universities, are as efficient and are taking a significant enrollment share from the laggards.
Like it or not, higher education is a business. Yes, there may be too much administrative oversight, the football coach makes too much money, the humanities are dying, research is important, etcetera, etcetera — we’ve heard this all before, but again, that’s not the point. I for one prioritize student learning, which requires a stable and affordable institution, and stability, unfortunately, depends on revenue. What is the first thing colleges do when there is financial trouble? They cut faculty, which in turn causes student learning to suffer; this is not a complicated cycle to understand.
You don’t have to be a professor of business history and innovation to figure this stuff out. Colleges need students, students need colleges, and any transactional lag or resistance in the chain is problematic. Whether you strive to enroll the best and brightest, the non-traditional, the online learner, or the young coed, you have to make it easy. Prospective students need to know who you are, what your value proposition is, and get enrolled with just a few clicks with no waiting. Amazon-Easy. As a very wise university president once told me about the difference between business and higher education, in business, it’s dog-eat-dog — in higher-education, it’s just the opposite.
