University Business - January 2009 - (Page 15)

money m at t e r s A major driver to an institution’s “best” aid strategy By Kathy Kurz and Jim Scannell Enrollment Capacity W hen analyzing financial aid strategies for our clients, one of the questions we always ask is “are you at capacity?” for many institutions, this is a difficult question to answer, and often we hear different answers from different corners of the campus. yet the answer has a big impact on how the institution should be thinking about its financial aid budget. for institutions that have empty dorm rooms and underused labs and classrooms, the financial aid budget can be viewed as a tool for generating additional enrollment and net revenue. at these institutions, a focus on simply controlling the financial aid budget or the discount rate can be shortsighted. if an institution’s applicant pool is very responsive to additional grant aid, increasing the discount rate could raise the total net tuition revenue (or net tuition and room revenue) produced by the class. for institutions that have no room for growth without adding significant fixed costs, the average net tuition revenue per student (a function of the discount rate) needs to be the metric of importance, and the campus needs to clearly understand the tradeoffs between the discount rate and other enrollment goals (e.g., quality and diversity). how can administrators begin to measure their institution’s capacity? Consider the costs related to campus facilities, personnel, and students. used between the hours of 10 a.m. and 2 p.m. four days a week. as for specialized facilities, often the space most at a premium is that used for special purposes such as labs or sports and recreation buildings. again, measuring current usage is critical to understanding whether those facilities could handle larger volumes. How many students could you add before having to build or renovate residence halls? or renovate residence halls? Could you change institutional policies to allow more students to live off campus? Could you “recapture” college-owned space that is being used for other purposes, such as rental property? how would tripling some rooms impact quality of life and student satisfaction? • Dining halls. how long do students currently wait in line at peak times? how long do the peak times last? During what hours can students just walk in and be served immediately? are there seats available, even at peak times? is your serving area capacity sufficient to handle higher volumes? The answers to these questions can help in establishing the number of additional students that could be served before an additional dining facility would have to be added. • Classrooms. During how much of the day are classrooms fully used? at many institutions, classroom space is only fully Personnel Does your institution need to keep the student-faculty ratio constant in a growth scenario, or can the ratio shift? if faculty members need to be added, will they be tenure-track or adjunct, full-time or parttime? Obviously, the costs of those options are quite different. Similarly, will it be necessary to add administrative staff? here benchmarking with institutions that are already at the size being contemplated can be helpful. in fact, the national association of Student financial aid administrators website (www.nasfaa.org) has a staffing model for aid offices to help in understanding whether an institution’s current staffing levels are above or below those at institutions with similar volumes. students it is important to understand where Kathy Kurz and Jim Scannell are partners in the enrollment management consulting firm Scannell & Kurz. They can be reached via their website, www.scannellkurz.com. G. Richard Wynn, vice president for finance and administration and treasurer at Haverford College (N.Y.), shared his thoughts for this article. January 2009 | 15 Facilities • Residence halls. how many students could you add before having to build universitybusiness.com http://www.nasfaa.org http://www.scannellkurz.com http://www.universitybusiness.com

Table of Contents for the Digital Edition of University Business - January 2009

University Business - January 2009
Contents
Editor's Note
College Index
Company Index
Advisory Board
Behind the News
Sense of Place
Viewpoint
Money Matters
Financial Aid
Community College
From Data to Information
5 Reasons to Switch to Virtual Servers
Finished in a Flash
Internet Technology
What's New
End Note

University Business - January 2009