We Are in Recession: We Are in Recession:

I'll Work for LessI'll Work for Less

Austerity, Public Accountability & the Free Market

Attempting to fit these Attempting to fit these sometimes competing sometimes competing values neatly together values neatly together is becoming a major is becoming a major challenge for many challenge for many administrators.administrators.

Stabilizing Leadership Continuity Requires…

FORESIGHT:FORESIGHT: ensuring a leadership ensuring a leadership legacy for the college is not always an legacy for the college is not always an inexpensive or popular task.inexpensive or popular task.

HINDSIGHT:HINDSIGHT: looking back at past looking back at past practices or the local culture may not practices or the local culture may not always provide the clearest viewpoint, always provide the clearest viewpoint, however it is where one must start.however it is where one must start.

A WORLD VIEW:A WORLD VIEW: balancing the free balancing the free market with local expectations, personal market with local expectations, personal values, expanding job expectations, & values, expanding job expectations, & evolving customary practice is not so evolving customary practice is not so simplistic anymore. simplistic anymore.

What this presentation is NOT:

1.1. Not an example of everything our College does right.Not an example of everything our College does right.

2.2. Not an explanation of what you should do.Not an explanation of what you should do.

3.3. Not an indictment of compensation.Not an indictment of compensation.

4.4. Not an indictment of Boards.Not an indictment of Boards.

5.5. Not an indictment of College Administrators.Not an indictment of College Administrators.

6.6. Not an indictment of the Faculty.Not an indictment of the Faculty.

7.7. Not an indictment of the Public.Not an indictment of the Public.

8.8. Not an indictment of Politicians.Not an indictment of Politicians.

9.9. Not a moral tale of Right versus Wrong.Not a moral tale of Right versus Wrong.

10.10.Not an assumption that we have answers.Not an assumption that we have answers.

What this presentation IS:

1.1. An attempt to have a necessary but highly An attempt to have a necessary but highly uncomfortable conversation about leadership, uncomfortable conversation about leadership, stewardship and compensation in the current stewardship and compensation in the current time period.time period.

2.2. A desire to dialog about rationality, market A desire to dialog about rationality, market forces, public discourse, and the role of higher forces, public discourse, and the role of higher education professionals in managing a education professionals in managing a sometimes controversial subject matter.sometimes controversial subject matter.

3.3. An attempt to An attempt to rationallyrationally discuss where we discuss where we should be going in compensation, how we should be going in compensation, how we justify it to the public, and how we bring back justify it to the public, and how we bring back prestige to higher education professionals.prestige to higher education professionals.

Summer 2011: A Case Study: New Jersey

New leadership in the Statehouse, a new agenda: not New leadership in the Statehouse, a new agenda: not always friendly to public education.always friendly to public education.

Strong recession with negative impacts in the Strong recession with negative impacts in the households of the people we serve (devastated households of the people we serve (devastated housing markets, high unemployment, no jobs for housing markets, high unemployment, no jobs for college graduates, etc.).college graduates, etc.).

A news media, full of low paid reporters, who are A news media, full of low paid reporters, who are watching their industry die.watching their industry die.

A series of sensational stories that drives the public A series of sensational stories that drives the public discourse.discourse.

An anger filled public, close enough to Wall Street to An anger filled public, close enough to Wall Street to feel impact of bank failure, but far enough away that feel impact of bank failure, but far enough away that the ‘villains’ are out of reach.the ‘villains’ are out of reach.

Public focus on unions and executive compensation. Public focus on unions and executive compensation.

Summer 2011: A Case Study: New Jersey

Other Campus ActivitiesOther Campus Activities

1.1. A series of very public A series of very public Retirements/Resignations under pressureRetirements/Resignations under pressure

2.2. Comptroller’s Office Investigation of NJ CC Comptroller’s Office Investigation of NJ CC Presidential Compensation (ongoing)Presidential Compensation (ongoing)

3.3. In two year period, 5 of 19 presidents left In two year period, 5 of 19 presidents left institution under scrutiny, overall during same institution under scrutiny, overall during same period 3 other presidents retired, and a series period 3 other presidents retired, and a series of other administrators were dismissed.of other administrators were dismissed.

4.4. Hard time to be in the recruiting business for Hard time to be in the recruiting business for campuses.campuses.

Finally in August 2011

Statewide look at Compensation

• Newspapers OPRA All• Community Colleges vs. Senior Publics show no comparison• Some senior college president’s make more in retention bonuses.• Public Outcry: None“College Professionals Make $”Non-Story•Statewide Senior Public Organization shows guts.

Aftermath Hard searches for leaders become even Hard searches for leaders become even

more difficult in NJmore difficult in NJ

Dissention on campuses, notably in union Dissention on campuses, notably in union contract discussionscontract discussions

Community College presidents being Community College presidents being investigated by the state Comptrollers investigated by the state Comptrollers OfficeOffice

Reputations DamagedReputations Damaged

Trustee Reputations DamagedTrustee Reputations Damaged

Students Lose Again!Students Lose Again!

Why Change is Why Change is NecessaryNecessary

In this game of In this game of public austerity public austerity and accountability and accountability for Colleges, what for Colleges, what is the best method is the best method of competing in of competing in the Free Market?the Free Market?

One drop can affect…

every college in a system.

Higher Education Compensation

National Public Presidential CompensationNational Public Presidential Compensation

$1.8-million (Highest)$1.8-million (Highest)

$440K (Median) – Senior Publics$440K (Median) – Senior Publics

$175K (Median) – Community Colleges$175K (Median) – Community Colleges

$88K (Lowest)$88K (Lowest)

NJ Athletic CoachesNJ Athletic Coaches

Football: $2.5-millionFootball: $2.5-million

Basketball $500K (M) & $950K (W)Basketball $500K (M) & $950K (W)

Looking into the future,Looking into the future,What is Higher What is Higher

Education to do?Education to do?

Clear Expectations, Clear Principles, No Guess Work, No “Understandings”

1. Clear Expectations2. No “Grey Areas”3. Define Your Community Tolerance Levels in Advance4. Be Public (Do not work in shadows for comfort’s sake)5. Dialog about compensation, expenses, & reality6. Put safeguards in place.

1. Internal Reviews (Annual)2. External Reviews (Audit)3. Succession Planning4. Continuous Public Dialog

The Administration, Faculty & Staff must work together to master the coming days.

Questions

The ultimate loser in these conflicts

Legal fees & ‘buy-outs’ are

paid by ourstudents.

Remember who really pays the

bills.

What drives our

economic engine?

What shouldrunning our

colleges not be about?

• PoliticsPolitics• PopularityPopularity• PersonalityPersonality

Next Step…

Commitment!Commitment!

Recommendations

1.1. Sometimes “No” is the best answer.Sometimes “No” is the best answer.

2.2. Build leadership from within, create a Build leadership from within, create a succession plan. We did our own, cost $0succession plan. We did our own, cost $0

3.3. Develop an “Exit Strategy” and stick to it.Develop an “Exit Strategy” and stick to it.

4.4. Prepare yourself to be unpopular and stand up Prepare yourself to be unpopular and stand up to the public/politicians (sometimes they are to the public/politicians (sometimes they are wrong)wrong)

5.5. Develop TrustDevelop Trust

6.6. Be Fair, Just, & Principled.Be Fair, Just, & Principled.

7.7. Stay ahead of the curve.Stay ahead of the curve.

Leadership Leadership LostLost