Steadfast in What We Sustain
We are after Labor Day (no more seersucker until Memorial Day!) and that means that we are all back in school throughout the entire MISBO footprint. Most of the deeper south has already been in school for several weeks and there is a minor movement right now to legislate a later start date for the school year, something that is normally left up to local control. We will see how that turns out. With the start of the school year comes all of the nervous anticipation of introducing students to the rhythms of the school life and the magnificence of the relationships that will be fostered and will grow now and into later life. These are the most memorable parts of school for most students and these are the most worthy of being sustained for future generations.
Sustainability continues to be one of the most common buzzwords in the independent school landscape - and it has been for quite a while. In 2005, then NAIS President Pat Bassett described five areas for focused sustainability in independent schools: demographic, environmental, financial, global, and programmatic. Articles, blog posts, books, videos, and podcasts have been created and consumed on the topic for years. The current general consensus seems to be that financial sustainability is the leading concern among schools. Ask yourselves or ask any other school leaders what their top concerns are and they will invariably say enrollment and the financial future of their school. You have no doubt heard that we need to shore up enrollment, look for alternative revenue streams, and create a greater culture of philanthropy - all while continuing to keep up with other schools in our market with the best teachers, the most modern facilities, and the best technology.
Taking a quick look at the independent school business model reveals that we might be the only industry that charges less for our product than it costs to produce it. Considering what I call the "biggest rocks in the jar," tuition accounts for only about 80% of revenue for schools, auxiliary and giving about 7%-8% each, and investments about 4%. On the expenses side, we spend most of our funds on people at about 65% (this includes salaries, growth and development, retirement, and the skyrocketing costs of health care), technology and students, plant, administrative, and debt service.
Data from MISBO schools, 2017-18 school year.
A quick comment on the topic of enrollment: we spend most of our efforts looking at enrollment as an issue of getting more students onto campus, analyzing the highs and lows in various grades, and predicting patterns over a 10-12 year cycle. There are numerous outstanding tools and phenomenal organizations dedicated to the concept of enrollment management. These groups and I will loudly proclaim that schools with serious enrollment issues probably have even more critical re-enrollment issues. Consider changing the conversation at school and engaging the entire community in your long-term success. Not just the student-teacher relationship, which is the heart of the school experience, but the student-teacher-family-administration relationship, which speaks more directly to the totality of the experience. These experiences are shaped by hundreds of daily interactions that include things like carpool, cheering together at games, reviewing an essay, delivering a speech, and receiving accolades.
MISBO Board Chair Philip Cork describes financial sustainability as a result of practices that shape a school's culture.
Every independent school has its own school culture that is worthy of being sustained - defining this and celebrating it is the real hallmark of the future. Enjoy the start of school and join us in Hilton Head at our 2018 Fall Conference (which is just a month away!) where we will focus on some of the other big rocks in the jar and look at turning our Aspirations into Operations - and yes, we will avoid the hurricanes!