ERP in Higher Education - An Unsustainable Model
Most of higher education is under enormous pressure simply to survive. Annual growths in tuition, and in all too many cases low graduation/completion rates, are simply not sustainable. Demographic changes are challenging us to rethink just who it is that will come to our institutions in the future. From a tuition perspective, at least within private higher education, if nothing changes, we will be looking at tuition rates above$75,000+ a year all too soon. There are already more than 150 colleges that charge more than $50,000 a year. At least one American institution is over $60,000.
With this reality in mind, and as we think about what distinguishes one institution from another, I doubt that many of us would focus on business or administrative processes. That is, the process that we use to pay our employees; the process we use to award financial aid; the process we use to pay our bills, to collect our revenues, to hire our employees. And yet these processes require substantial investment and on-going support. So, what should distinguish our colleges and universities one from the other? It strikes me that the primary measures are: the quality of our faculty; the quality of our programs; the quality of student learning; the quality of student outcomes.
Nearly every single institution of higher education has made enormous investments in business and administrative systems, to support the processes among others noted above. Whether we use Banner, or Datatel, or PeopleSoft, or Campus Management, or Jenzabar, or some other system, these investments are likely the largest single investment in technology any institution has ever or perhaps ever will make. And the initial investment is only the beginning. Annual maintenance, hardware, technical staffing to support the software and the hardware upon which it depends subsumes an ever greater percentage of our increasingly limited budgets. Is this really the place where we need to invest our technology resources?
While some may call this naïve, I believe the future is: Cloud (worried, get over it); Software as a Service (SaaS); Subscription-based models (using Student FTE as the count?); and, most importantly, the adoption of much more common and standard business processes.
There are models existing today, while not mature enough, will be sooner rather than later.
I suspect the biggest challenges to this new model will not come from Information Technology but from business and administrative offices that ‘couldn’t possibly change the way we’ve always done business’. The bottom line question for our institutional leadership: Is this current model of individual installations of software; individual installations of hardware; individual institutional groups of technical staffs; and unique business practices sustainable? I say NO.