Higher Ed Transformation for the Campus of Tomorrow: Arkansas State University System President Shares How Institutions Can Adapt to Today’s Market
Across the country, higher ed leaders are in the midst of an upheaval. While a traditional higher education experience was an expected next step for the past few decades, students today are now weighing their options. Four-year institutions are competing with and creating global online programs. States are demanding more transparent data. And enrollment numbers aren’t as reliable as they used to be.
We have entered the era of accountability, and the future is simultaneously unclear but full of promise as new technologies allow schools to reach more students than ever before.
In order to meet the new standards of access and outcomes, higher ed institutions have to prepare for the future while still meeting their immediate financial, operational, and academic needs.
In this podcast series, Higher Ed Transformation for the Campus of Tomorrow, we’ll speak to experts on the transformation process, to help guide higher ed leaders through operational management for the present and strategic planning for the future.
In our first interview, we speak with Dr. Charles Welch, President of the Arkansas State University System. He believes if higher ed institutions want to stay relevant, they need to take a cue from other industries and adapt new technologies and processes to compete in today’s market.
“We see ourselves as different, we see ourselves as unique. And we are in so many ways. And you don’t want to lose those aspects of what we do. But at the same time, we have to realize that market forces affect us, just like they do a Toys ‘R’ Us or some of these other companies that are struggling against the Amazons of the world,” Welch says.
“I think that we have to look at the broader society and the things that are happening with technology, and the way that people are viewing services that are provided to them.”
So, what are some ways that higher ed leaders can adapt to a changing industry?
Listen in to our interview with Charles Welch to find out how the Arkansas State University system is adopting more efficient and innovative business practices for the future, creating not only better career outcomes for its students, but better economic prospects for the state as a whole.
Hannah Nyren: Hi, this is Hannah Nyren with EdTech Times, and today we are speaking with Charles Welch, president of the Arkansas State University system. Our topic is the transformation of higher education. So, Charles, how are you doing today?
Charles Welch: I’m doing well Hannah, thank you very much.
Hannah Nyren: So, tell me a little bit about who you are and the school that you represent.
Charles Welch: Sure, I am the president of the Arkansas State University system. I am about to start my eighth year in this particular position. Born and raised in Arkansas, and this is my third presidency in the state. The system itself has five institutions, a flagship university and actually four community colleges. We have about 24 thousand students, and a budget of about 300 million dollars, located in different parts of the state.
Hannah Nyren: Great. So, today we’re talking about innovation and planning, and how you’re going to make your institution even better in the future. So, what do you think are the biggest challenges facing higher ed right now, and how is your institution particularly adapting?
Charles Welch: Well, I think it’s the fact that higher education itself is not being valued like it once was. And that’s from multiple angles. First of all, obviously from a funding angle. And I hate to go straight to that one, but obviously it’s one that has to be discussed. When you look at the amount of state revenue that’s not flowing to higher education now, the cuts that we’ve seen across many states…Arkansas has been fortunate in that we have not experienced cuts. My tagline is that flat funding is the new winning. Although, if you see any sort of enrollment increases, obviously that decreases your per-FTE [full-time enrollment] student funding. So, I think that’s obviously a real challenge.
Charles Welch: But then, from the general populace as well — we see journal articles, we see studies that consistently say Americans wonder whether or not it’s worth the cost anymore of higher education. And so when you couple a disinvestment from the states with folks that wonder whether they really need to do it in the first place, it really is a double whammy for our institutions. And so, I’m really concerned about how we maintain that relevancy, that legitimacy, in the minds of of Americans. And how we try to impress upon our policymakers that it’s not just a cost, it’s an investment.
Charles Welch: All we talk about is the cost of higher education. The cost of the individual, the cost to the state. We never talk about that investment. We never talk about the fact that incarceration rates are significantly lower for an individual with a college degree. We never talk about the fact that unemployment rates are half typically for a college degree of what they are for a high school graduate. We never talk about how health, health usage, I mean, the cost of healthcare for a college graduate is much lower than it is for high school graduates. We never talk about how they lead longer lives, how they’re more philanthropic. There’s so many different things that are positive for society and for what we spend governmental funds on.
Hannah Nyren: And particularly in your state, I know there’s been a lot of investment in education to create a better future and better economy for the constituents within the state.
Charles Welch: We’re a state that historically is ranked somewhere near the bottom in terms of baccalaureate attainment rate. You know, K-12 is constitutionally mandated. And several years ago, there was a landmark legal decision that required adequate funding of K-12. And so there have been millions upon millions of dollars that have been put into the K-12 funding system.
Charles Welch: And I’m supportive of that obviously, a stronger K-12 system makes for a stronger higher education system. The problem is, we have to continue to impress upon those policymakers that we can’t afford to stop at the 12th grade — whether or not that is a two-year degree, a vocational technical training, or whether that is the baccalaureate degree and beyond. We’ve got to find ways to increase those linkages and that understanding that we can’t stop there if we want to have the type of high-wage jobs that they’re going to propel our state forward.
Charles Welch: But I will say that our policymakers on the whole have really been resistant to doing what we’ve seen in a lot of other states, and that is dramatically cutting higher education and forcing our institutions to rely upon tuition increases or other things. And so again, while we haven’t had new funding, they have recognized at least the need to maintain the funding that we have now in hopes that that we can use innovation throughout our institutions to try to offset some of those — that lack of new money.
Hannah Nyren: So, speaking of funding — you recently received, I think, 500 thousand of state funding for the Accelerate ASU efficiency study. What compelled the governor to believe that this investment was necessary for higher ed?
Charles Welch: This is something that our board of trustees and I have been talking about for some time. And that is a comprehensive, system-wide study to really try to determine where we could become more efficient, where we could become more strategic in making sure that we have our resources appropriately aligned. You know, we see institutions all around the country that are having to force layoffs, they’re having to shut down programs, they’re having all sorts of problems. And we didn’t want to get there. We weren’t to that point yet, but we wanted to be proactive in trying to find ways that we don’t wake up and have that same situation affect us.
Charles Welch: And so, what this study did was really look at both administrative and academic efficiency opportunities. We partnered with Huron Consulting Group. They came in and did about a 14-week on-the-ground review of all five of our campuses, as well as the system office. They created an academic cost accounting model for us, that allows us to know how much a degree is costing both the student and the institution. And it was not an effort that was focused on closing programs, but rather understanding better exactly what we’re spending, where we’re spending it, what sort of return that we’re getting. We can see if we’re underfunding particular programs in ways that if there are programs that aren’t performing or giving us the ROI that we would want, we can look for ways to try to reformat those programs or do things that would allow them to be more efficient and productive in the future.
Charles Welch: Of course, you know, the challenge on our campuses is about making sure you’re very transparent when you do these things on the campus. Because immediately, obviously, there was concern that this was being done to legitimize shutdowns. And that was not at all the case. But rather, perhaps we can make improvements, so again, we don’t wake up two or three years down the road and being forced to do things. And so, that’s a challenge. But we feel good about it, the results we feel good about. We feel like there’s a ton of opportunity for us to do things better and smarter and more strategic in ways that we could really have an impact — not only on the programs and on the institution’s bottom line, but on students as well and ensuring that they’re getting the resources appropriately placed where they need to be to maximize the educational value for them.
Hannah Nyren: Right. And when it comes to the business of higher ed, people do get a little alerted and concerned. But when it comes down to it, in order to get the results that you want, you have to treat it like a business. So, what has Arkansas State University done to transform its business practices to be more efficient so far?
Charles Welch: I think that one of the things that we have really pushed over the last four or five years is really trying to reduce our reliance on student tuition and fees. You know, I’m a first-generation college student. Arkansas is a historically very undereducated state. And we realized that if we place more of that burden on the backs of our students and their families, we are only furthering that problem and making it even more difficult for students to access higher education.
Charles Welch: Obviously, you have to seek other ways of creating revenue streams. And what we’ve tried to do is be innovative through public-private partnerships, to bring additional revenue into the institution. We actually created the state’s second medical school on our campus through a partnership with a private medical school. That brings in additional revenue stream. That brings in additional students into our science programs as they want to matriculate into that program. And it’s helped us very much from that standpoint.
Charles Welch: We actually opened a campus in Mexico, a campus that is entirely funded through private funds, Mexican private funds. They essentially are a revenue generator for us. But also provides a ton of ancillary type benefits from student and faculty exchange and international educational relations. We’re in the process of building an Embassy Suites Hotel and Convention Center on our campus. A private developer with all of the costs, again we’re essentially a landlord, but provides a number of programs for our students. We’ll have a hospitality management program, and they’ll have a hands on lab there to work. And again, it’s a revenue generator. So, we really look for alternative revenue streams and continue to do that so that we don’t have to rely on student tuition knowing that there’s not a great likelihood of a lot of new governmental funds coming into our institution.
Charles Welch: In terms of the practices side, we’ve really looked for ways to collaborate among our campuses. And if we can find ways to collaborate that internally save money for each of those institutions, we can do it. We’ve tightened up travel processes. That seems small, but all of those things add up a little bit at a time.
Charles Welch: When you consider the fact that about 76 percent of our budget system-wide is tied up in personnel salaries or student scholarships. You have a very small percentage left that isn’t directly tied to our people. And so one of the things that we say is, “We’re not going to cut our way out of this. We have to innovate our way out of this.” And so we’re really trying to look for different models, ways to do things differently. I talk a lot about the old joke that if Thomas Jefferson were to come back to life the only thing he would recognize is the inside of a college classroom because we don’t change very much. And—
Hannah Nyren: That’s pretty harsh.
Charles Welch: It is harsh, but, but we’re all — we’re typically one of the last to change. And we talk about change in higher education is like turning around a cruise ship. And so, we’re really trying to be a model for that. I think that’s one of the things that helped with our request to Governor Hutchinson, is he recognized this wasn’t our first foray into this area. We had already been trying to do things. But I think it’s one of those that, you know, if you don’t set yourself apart, if you don’t find ways to do things differently, I think higher education’s in a very, very challenging environment right now, and we’ll all find ourselves in a very difficult situation if we’re not different than what we’ve been doing in the past.
Hannah Nyren: Yeah, I think you might be right there. I think a lot of people are realizing that and kind of trying to figure out how to innovate and how to change and how to prepare.
Hannah Nyren: So, why is innovation so crucial to a higher education institution’s survival? You were just saying how important it is but like, what would happen if they didn’t innovate? What would happen if these changes weren’t made?
Charles Welch: Sometimes I liken it to what’s happening in retail right now. If you look at these entities that sort of ignored what was happening outside of them and continued to do things the way that they had…And all of a sudden they find themselves in a very dramatic situation. And I think higher education’s no different.
Charles Welch: I typically tell the story about my previous presidency. I was speaking at an entire faculty convocation. And one of the things that they talked about a lot was my age. I was very young. It was early in my career.
Charles Welch: And I was talking to this group and I was trying to impress upon them the importance of change and innovation and doing things differently. And this was a very traditional institution, that really preferred the face-to-face instruction Monday through Friday. And I told the story of an evening that I was leaving the office and one of our administrative assistants, one of our lowest paid employees, a single mother, was sitting at her desk working. And I stopped in and said, “Hello,” and I said, “what are you working on?” And she said- she got this apologetic look and she said, “I’m not working on ‘work work’. I’m actually taking a class and working on it.” Now, I prefaced all this with saying we waved 100 percent of tuition for our employees. And I said, “Oh which class are you taking?” And she said introduction to psychology, a very basic level course that I said, “Who’s your professor?” And she said, “I’m taking it from a university in Wisconsin.”
Charles Welch: And what I said to the faculty that day is I said, “Folks, a lot of you think I’m very young. I haven’t been out of college that long and perhaps that’s true.” But I said, “When I was in college, if you wanted to take a class from a university in Wisconsin you got in the car and drove to Wisconsin. And I said, “This is an entirely different time. We have a lot more competition. The game has changed. And so we have to do things differently.”
Charles Welch: And I think one of the things that we’ve really resisted in higher education is doing that. We see ourselves as different. We see ourselves as unique. And we are, in so many ways. And you don’t want to lose those aspects of what we do. But at the same time, we have to realize that market forces affect us just like they do a Toys “R” Us or some of these other companies that are struggling against the Amazons of the world. And so, I think that we have to look at the broader society and the things that are happening with technology and the way that people are viewing services that are provided to them.
Charles Welch: And if we’re not doing it in the manner that is most conducive to the lifestyles of those who want to seek higher education, someone is. And, you know, they will go find that someone. Whereas historically maybe there were fewer options, now the options are limitless for students that want to provide higher education, and we have to find how we fit into that mix.
Hannah Nyren: Yeah that’s very true, and it’s good that you’re already working on that. So, how does your own unique personal educational and career background influence the way you approach education today?
Charles Welch: Well, mine is certainly not a typical background and path. I was the individual who was… had my career path charted out when I was 10 years old. And then quickly figured out that wasn’t what I wanted to do after I got to college. But went to college with the anticipation of going to law school and entering the political arena. That’s what I thought I wanted to do. And I was elected student government president at University of Arkansas. And in that role, worked very closely with the chancellor and other members of the administration and began to think about the impact that they have on the lives of young people that are looking for a different future than perhaps what their own family has experienced. And that’s what really began me thinking about, perhaps I wanted to do this. This was my opportunity to be a public service, to give back to — to my own family, to my own state and try to help other people have some of the experiences that I did, particularly coming from the background that I did.
Hannah Nyren: That sounds great. And I see that you’ve spent your entire career and your entire life trying to help your community and trying to help further education within the state of Arkansas.
Charles Welch: Absolutely. My parents, my father didn’t graduate from high school. He was a truck driver. My mom is a high school graduate. They were extraordinarily supportive of that and taught me at an early age because they wanted me to have what they hadn’t had, which I think is all of our dreams as parents. But they also didn’t quite understand what they wanted, how the process worked, how the system worked. And so I realize there’s a lot of young Chuck Welches out there that, you know, perhaps they think they might like to go to college, but they’re concerned that maybe they’re not smart enough. Or no one in their family has gone, so why should they? Or can they afford it, or I don’t understand what a credit hour is, or what is the FAFSA, or how do you fill out an application for admission? When they look at me, they don’t see my upbringing as being similar to theirs.
Charles Welch: And so if I can tell them, I had that exact same upbringing and challenges, and I had student loans and all of those things. I think it helped show that hey, this is possible. To sit there and watch those young people walk across and realize that for many of them this was something they never dreamed imaginable and now because of that they’re going to be able to do things they never dreamed imaginable in their life. So, it’s a very fulfilling part of the job.
Hannah Nyren: Well, you certainly serve as an inspiration for your university students. Thank you so much for speaking with us today. It’s been great to hear about what you’re doing at Arkansas State University systems and to see how you’re bettering the state overall.
Charles Welch: Thank you. It’s been a pleasure to talk with you. Thank you.
This episode is brought to you by Huron.
Huron is a global professional services firm with an extensive history in higher education. For nearly two decades, Huron has provided consulting services for over 500 educational institutions, including all 100 of the top research universities in the United States.
You can learn more about what Huron does by visiting huronconsultinggroup.com.