Following my brief update to the faculty during the Faculty Retreat I was asked what risks were considered and how did we come up with the eight risks identified in Affirm, Assure and Assess?
I thought it might be helpful to provide a little background on risk.
2008-09 and Enterprise Risk Management Assessment
Augustana’s assessment of risk and vulnerability goes back to 2008-2009 when President Bahls was challenged by Doug Hultquist, who was then chairman of the Board of Trustees, to develop “an enterprise risk management assessment.” While this kind of risk identification is commonplace in the corporate world, it was new to Augustana College.
In typical fashion President Bahls responded to the board chair’s challenge and produced a very thoughtful analysis of the most significant risks Augustana faced.
At the annual board retreat in January 2009, the president and senior leadership team presented a summary of the ten most important issues facing the college, as well as steps being taken to address those issues:
- Inability to maintain enrollment
- Inability to adjust to stock market and high levels of debt
- Breakdown of “high-cost/high-discount” business model
- Loss of reputation
- Breakdown of trust between board, administration, faculty and staff
- Neighborhood concerns
- Change in federal or state financial aid policies
- Failure to address deferred maintenance
- Natural or manmade disasters
- Inept management or complacency of the board, administration or faculty
So, the idea of risk and assessing vulnerabilities is not new to the college, but members of the Strategic Planning Task Force believed it was prudent to revisit the risks identified in 2009 to determine if any or all were still relevant.
Re-Reviewing Augustana’s Risks
This re-review of the risks facing Augustana College was the foundation for the plan we developed.
Early in the planning process, The Strategic Planning Task Force reevaluated the risks identified in 2009 and asked whether or not each risk was still relevant. The group then went a step beyond, and asked whether or not the college had “any control” over the identified risk.
This question was critical because it demonstrated that the Strategic Planning Task Force understood right away that our plan must focus on those things we can control.
Grading Augustana’s Risk
To help the The Strategic Planning Task Force set the college’s strategic direction and focus on vulnerabilities over which we have some control, the risks were grouped in the following way.
Risks facing all of higher education and those colleges in our sector over which we have little control:
- Natural or man-made disaster
- Loss of state and federal aid
- Endowment losses and market volatility
- General attack on higher education
- Lack of meaningful measurement of core learning outcomes
- Sustainability of the liberal arts model
Risks facing all in higher education and which we can minimize through strategic focus, planning and programming:
- Difficult job and graduate school market
- Calls for accountability and demonstration of effectiveness and outcomes
- Inability to advance reputation
- Inability to respond swiftly to the market or a crisis
- Changing demographics in employee base and student body
- Breakdown in the high-cost/high-discount model
Risks facing Augustana that we must minimize through strategic focus, planning and programming:
- Physical plant
- Tuition dependence
This exercise helped the Strategic Planning Task Force narrow its focus and develop those risks that most deserve our strategic focus.
A Contemporary and Realistic View of the Risks Augustana Faces
Although our list of ten quickly grew to 15, we were able to ultimately settle on eight contemporary risks, with the understanding that 1) each area is something over which we have control, and 2) the inability to address each could have a significant impact on the college.
- Inability to maintain full-time, on-campus enrollment of 2,500 students from diverse backgrounds without significantly increasing the tuition discount rate
- Inability to maintain and develop the necessary financial resources to deliver our mission/program
- Inability to prepare our graduates to stand out to employers and graduate schools
- Inability to demonstrate the college’s value, advance our reputation and earn positive recognition
- Inability to successfully recruit, motivate, diversify and develop our human resource base
- Inability to address issues related to our physical plant, including technology infrastructure and deferred maintenance, in a timely manner
- Inability to respond to adverse changes to our neighborhood and/or broader community
- Inability to respond quickly and proactively to external conditions
In agreeing on these risks, we clearly delineated the boundaries of our risk profile—those things that uniquely or independently impact our college and those things that others also may face, but to which we are committed to being better than anyone else. We had a strategic direction that mattered.
W. Kent Barnds
Vice President of Enrollment, Communication and Planning