Ricardo Azziz has held quite a few government positions in greater schooling and led the merger that resulted in Georgia Regents College, now Augusta College. He’s principal at Strategic Partnerships in Greater Schooling Consulting Group.
He writes the common Merger Watch opinion collection on company restructuring in greater schooling.
Lately, a number of universities and schools have explored or applied consolidations of faculties inside their campuses. How do consolidations or mergers of faculties inside the identical greater schooling establishment relate to mergers between totally different establishments? The brief reply — there are vital similarities but in addition vital distinctions that leaders should acknowledge to facilitate a extra profitable and fewer disruptive consolidation.
How are these mergers comparable?
Mergers between establishments, when they aren’t solely about survival, stem from shared motivators: a need to create operational efficiencies, collaborations, new applications, expanded scholarship alternatives, and a basic rejuvenation and reenergizing of the events.
So too are mergers of faculties or schools inside the identical establishment.
Ricardo Azziz
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Mergers between establishments are additionally pushed by a need to create better operational efficiencies and monetary financial savings. It is the identical when a college or faculty goals to scale back the variety of schools or faculties on campus by way of consolidation, notably if their enrollment has been flat or declining. Whereas it could be optimum to redirect financial savings to boost the scholar and school expertise, they’re typically wanted to offset current deficits.
For instance, North Dakota State College President David Cook dinner lately proposed decreasing his establishment’s seven tutorial schools to 5. The transfer would start to deal with a $7.6 million discount in state funding associated to declining pupil credit score hours on the college. The College of Wisconsin-River Falls proposed a plan to scale back the variety of schools on campus from 4 to 3 and save on administrative prices. Pennsylvania Western College, itself the results of a current three-way merger, will consolidate its six tutorial schools into three because the college seeks to chop prices whereas reversing enrollment losses. And the School of St. Scholastica, in Minnesota, introduced in April that it’s consolidating its six faculties to 3.
Consolidation of faculties typically means a concomitant discount within the variety of executives, workers and even school, enhancing financial savings. Nevertheless, much like institutional mergers, the financial savings in human capital are vital however comparatively modest in comparison with everything of an establishment’s funds.
For instance, PennWest estimates it would save roughly $2 million — or 0.67% of its roughly $300 million funds. This could not come as a shock since, regardless of what some school assume, the price of administrative assist inside greater schooling establishments is usually modest relative to the working funds of all the enterprise.
One closing similarity lies within the degree of authorization required to execute this organizational restructuring. Such proposals require the approval of the establishment’s governing boards.
What are the variations?
There are, nonetheless, essential variations between inner mergers and institutional mergers. Most important is the diploma of transparency, communication, and school and workers involvement. Often, when mergers, consolidations or acquisitions of establishments are being explored, everything of the consideration and negotiation section is confidential. It entails only a few members of the campus neighborhood, specifically the board and high-level executives. Solely when the deal is finalized does the rest of the campus and area people discover out and have interaction within the implementation course of.
Alternatively, when an inner merger of faculties or schools is being thought-about, the intention is telegraphed nicely prematurely, suggestions is sought, and committees of workers and school are appointed. Whereas this does not imply that school and workers have the facility to approve such a consolidation — the governing board has that sole authority — the initiative doesn’t come as a shock. Stakeholders normally have the chance to, at a minimal, guarantee their voices are heard and affect the form of the consolidation.
A closing distinction lies within the board’s willingness to assist the initiative. Inner mergers are sometimes supported readily, not like mergers between establishments, which usually entail painstaking and tough deliberations by board members.
As for institutional mergers, you will need to notice that not all inner consolidations are essentially the best technique.
I used to be beforehand president of Georgia Regents College, now known as Augusta College, proper after it had been created by way of a merger of establishments. Following the merger, we intentionally cut up the then School of Arts & Sciences. The huge faculty, which had housed over 60% of all undergraduates, turned the Pamplin School of Arts, Humanities, and Social Sciences and the School of Science & Arithmetic. This allowed for better and distinct consideration to be paid to the liberal arts and, individually, to the STEM fields. It additionally leveraged the brand new relationship to the tutorial well being sciences ensuing from the merger of Georgia Well being Sciences College and Augusta State College.
Nonetheless, there is no such thing as a doubt that in in the present day’s more and more tough surroundings, inner mergers might improve wanted efficiencies, collaborations, and interdisciplinary scholarship and schooling, whereas offering a modicum of financial savings. We also needs to do not forget that the construction of upper schooling establishments shouldn’t be immutable — it must be versatile sufficient to adapt to a quickly altering surroundings.
