State of the University, Spring 2013
February 28, 2013
Dear Colleagues:
In past years I have written to you just before commencement to update you on developments at the University that have occurred throughout the academic year. This year, I am writing earlier than usual to let you know about the specific steps we are taking this spring to address important changes in higher education. During discussions to develop our fiscal year 2014 budget, which began last fall, we examined all of our programs in the context of the uncertain economic climate. We concluded that we must not only address the immediate gap between revenues and expenses that I described in my letter of October 2012 by reducing budgets for fiscal year 2014, but also that the economic outlook for research universities calls for a more long-range and comprehensive strategy.
Consequently, as part of our development of the fiscal year 2014 budget, Provost Morrison and I have worked with deans and senior administrators to propose reductions in our budgets for next year amounting to approximately one percent of our total revenues. Later in this letter, I will describe the particular cost-saving administrative initiatives that are already being implemented to accomplish these reductions.
Finalizing the budget for next year is only the first step. The most important part of our efforts must be to develop the long-term capacity to continually assess the quality and effectiveness of our programs and services so that they meet our own expectations and aspirations as a leading private research university.
Why start this process now?
Over the last seven years, we have worked together to implement our plan to become a great private research university with a distinctively global focus; a university that offers innovative, rigorous educational programs led by a distinguished faculty deeply engaged in groundbreaking research and scholarship that is focused on the most important challenges and issues facing society. We have also renewed our focus on the success of our students during their studies at Boston University and in their subsequent careers.
There are a number of important indicators that we are on the right path. Our faculty members are increasingly recognized for their scholarship, many of our research programs are being heralded for breakthroughs, and our undergraduate students are succeeding at the highest rates in our history.
The invitation to join the ranks of the Association of American Universities (AAU) was an especially important milestone. The news that the number of applications for the freshman class of 2013 has jumped by 20 percent—to almost 52,700—is another, very tangible sign of progress. Finally, our first comprehensive campaign—which we launched publicly in September—is off to a fast start raising new resources for facilities, programs, students, and faculty. The campaign has already generated funding to endow 30 professorships and 60 scholarships. This success is creating new energy among our 310,000 alumni as well as many friends.
Even as we gain momentum, there are also concerning signs that the higher education landscape is changing. The environment for research universities in particular is uncertain. I believe we must position Boston University not only to adapt and adjust to these changes, but to succeed and excel in this environment.
There are three major forces at work, which will require change in higher education:
- Concerns on the part of parents and students about the value of a residential university education, as the cost outpaces inflation and their debt burdens rise.
- The availability of increasingly sophisticated web-based educational tools and the potential for online instruction to enhance or supplant traditional instructional methods, resulting in better learning outcomes, greater programmatic flexibility, and potentially lower cost for our students.
- The likelihood of significant decline in federal government support for research, with no clear prospect of a resurgence in the near future.
The Boston University Value Proposition
To achieve our goals, we must both offer an exceptional education and ensure that the University remains accessible to students from a diversity of socio-economic backgrounds. Our tuition rates—like those of our peers—have outpaced inflation for decades, in part because we are heavily dependent on tuition and fee income. Over 50 percent of the revenue in our annual operating budget is derived from tuition and fee income. Delivering high-quality academic programs and co-curricular experiences (such as study abroad, research experiences, internships, and other opportunities) does not lend itself to economies of scale.
Understandably, parents and students want to know that there will be a return on the substantial investment they make. There are questions that our prospective students and their parents ask that we should ask ourselves:
- Does Boston University offer distinctive academic quality and student experiences that justify the significant commitment of resources and, sometimes, sacrifice?
- Are our academic programs and advising systems structured so that each student can optimize his or her educational experience, getting the most out of Boston University, and predictably graduate in four years or fewer?
- Does a Boston University education translate into the successful launch of a career and provide a foundation for long-term personal and professional growth, especially in the highly competitive, globalized economy our graduates enter?
We are likely to find that as parents and students evaluate tuition costs and potential debt burdens, our traditional value proposition is very sensitive to the answers to these questions. The financial aid we offer figures into their assessment. Currently we offer more than $190 million in undergraduate financial aid with more than 50 percent of our students receiving aid.
The same concerns are affecting graduate professional programs. Currently, there are fewer job opportunities and career advantages for graduates from programs that have traditionally assured professional success. Nationally, enrollments in select professional programs are declining; the decrease in applications to law schools has received considerable national-level attention, but is not an isolated example.
The Potential of New Technology
A simultaneous and, perhaps, countervailing phenomenon is the advent of new, more sophisticated web-based tools that offer the potential to revolutionize how the faculty uses its classroom time with residential students. These technologies may also offer added flexibility for our students to combine their on-campus experience in Boston with internships, study abroad, and other co-curricular opportunities.
Incorporating web-based instruction into our programs may dramatically alter how we deliver instruction, enriching the learning environment, and, consequently, enhancing our value proposition. Its use will, I believe, help control costs, even in an educational environment where we are committed to enriching faculty-student interactions. Boston University has extensive experience in non-residential, web-based education in graduate professional programs that we can build on as we incorporate these important tools into our residential curriculum.
Our Council on Educational Technology & Learning Innovation (CETLI) is working to recommend a strategy for the use of technology in our residential programs, as well as the expansion of our programs for non-residential students. We will need to commit resources to support the Council’s recommendations to develop and test promising innovations in the use of educational technology.
The Research Mission in Uncertain Times
Boston University faculty and students are working on some of the most important challenges of our time. At no time in history has society relied so heavily on the knowledge and innovations produced by our research universities for economic growth and societal good. We must remain focused on this mission, with all that this commitment entails. Most critical to the research mission is the recruitment and retention of internationally recognized scholars and the development and maintenance of the infrastructure that sustains their research and scholarship. Our revamping of the funding of doctoral research education is an important element of our work to provide sound research infrastructure, as is our investment in expanding and updating research facilities.
The commitment to the research mission will be more difficult during a period of flat or declining federal support for research, as the federal government moves to address the deficit. It is clear that Boston University will need to make strategic investments during this period of scarce federal support.
A Path Forward
Concerns about the higher education value proposition, revolutions in web-based learning, and likely shrinkage in federal research funding, taken together, are harbingers of significant and fast-moving change in higher education. Our goal must be, as it has been, to strive to be a high-quality, private research university that not only adapts to changes but that leads in finding innovative and cost-effective ways to fulfill its education and research missions.
How do we do this?
First, we must critically examine our academic programs—in terms of research, scholarship, and teaching—to ensure that they are meeting our expectations for quality, innovation, and impact. The newly established process for Academic Program Review is proving to be an important means for assessing quality. The reviews that are being conducted give us much-needed external perspectives on the quality of individual programs. These external assessments, combined with our own data-based analyses, will help us make difficult but necessary decisions about which programs are best positioned for growth and our investment, and which ones might be reduced in scope.
Second, as we look to the future and the need for continued investment in our programs and services, we must control costs and seek efficiencies so that we can simultaneously moderate tuition increases and maintain our financial strength and flexibility so that we can continue to invest in our future. We are working to create uniformly efficient core administrative services including support of desktop and portable computers, as well as finance, budget, and human resource support services. These efficiency initiatives will result in the clustering of some services in order to serve several administrative and academic units rather than having small-scale and often duplicative services across the University. Clusters are already being developed among multiple administrative units. For example, we are well on our way to consolidating support services within the Offices of the President and the University Provost, and we are working to include other administrative offices on the 8th and 9th floors of One Silber Way into one administrative cluster.
In addition, we have begun to study our purchasing patterns to find economies of scale that can be translated into savings both for the institution and for our researchers. We are also assessing administrative management structures to make sure that they meet current standards for scale and efficiency. These efficiency initiatives, combined with very modest budget reductions in academic and administrative units, will bring us into fiscal year 2014 (which begins July 1, 2013) on a sound financial footing. More importantly, we will develop the habit of continually seeking better and more efficient ways to deliver quality in our services and in our academic programs. The consistent effort to improve will serve us well in uncertain times.
Boston University is a great private research university with a commitment to excellence in residential undergraduate and graduate professional education in the changing, globalized environment for higher education. I look forward to working with you to fulfill that commitment.
Sincerely,
Robert A. Brown
President