Over the last year, I've been reconnecting with college presidents who were appointed at about the same time I was, seven years ago. Conversations among college presidents often turn to board relationships. We recall our initial years, when many of us were concerned that well intentioned board oversight could be too intense, crossing the line into micromanagement.
The leash felt too short, we would complain. Now, as mid-career presidents, the concern is often the opposite—that our boards are not involved enough. We appreciate the trust that we enjoy, but we need the thoughtful oversight and constructive engagement of our trustees.
The American Council on Education reported that the average president had served 8.5 years in office in 2006, up from 6.3 years in 1986. With presidents tending to have longer terms, boards must be more deliberate in examining how to interact with experienced presidents in a way that acknowledges the track record of those presidents without relinquishing careful stewardship of their institutions.
The real danger with a successful president and a complacent board is that the board will no longer have the benefit of a "marketplace of ideas" when making critical decisions. Supreme Court Justice Oliver Wendell Holmes stated in 1919 that truth is best reached by "free trade in ideas." Our faculties admonish our students the same way: Before reaching a conclusion, they should fully explore the differing ideas of diverse groups. Boards that rely on an experienced president as the major source of their information are just as likely as a student's single-source paper to arrive at uninformed conclusions.
Boards tend to take their oversight responsibilities most seriously during transitions in presidencies. At the beginning of a president's term, especially when it's a first-time president or someone new to the institution, boards are more engaged in ensuring that the president effectively executes the agreedupon agenda. When the new president faithfully implements a strategic plan, raises more money than expected, or generally steadies the ship, trustees collectively breathe a sigh of relief.
With that collective sigh of relief often comes an increased risk of complacency. Recent history shows the dangers of complacency. Preliminary reports from President Obama's commission investigating the BP oil spill blame the disaster on a "culture of complacency" among those within the oil industry and the regulatory community. The commission investigating the space shuttle Columbia disaster found the same thing: A culture of complacency was "as much a cause" of the disaster as the Columbia's mechanical failings.
The Arrogance of Excellence
College and university boards, and their presidents, are particularly at risk for a culture of complacency when a president has served his or her initial term and has been appointed to a new term. But what concerns me most is that two factors are combining in ways that may exacerbate the problem.
The first factor that may lull boards into complacency is adopting IRS Form 990 "best practices." I serve on several community nonprofit boards. Like college and university boards, each has adopted a set of "good governance practices" so that the organization may report those practices on the newly revised IRS Form 990 for nonprofit organizations. Many of the lawyers who drafted these "best practices" emphasize to boards that they are necessary "for IRS purposes," but they give short shrift to the real reason that they are needed. Such practices, and others, are designed to enhance board engagement and avoid complacency by appropriate oversight mechanisms. Yet an unintended consequence of hastily adopting those practices, particularly when boards trust their successful president, is that boards can often start thinking that they ensure good governance. In fact, adopting the policies is only the first step in a long and sometimes difficult path to ensuring strong governance.
The second factor that encourages board complacency is surviving the recession. Many boards are breathing a sigh of relief that their presidents have piloted their institutions through the greatest recession since the Great Depression. Enrollments and endowments are bouncing back. Many institutions are achieving record class sizes. Budgets and financial ratios are strengthening. In the eyes of many board members, the recession was a wake-up call, but the college had a president who was shrewd enough to help the institution dodge the bullet.
The combination of those two factors can significantly increase the risk of complacency and lead an institution to what I call the "arrogance of excellence." It occurs when college boards and presidents stop doing what we ask our students to do: Use the power of critical thinking. We tell our students to ask the hard questions and peel back the layers of superficiality by exploring whether the assumptions being made are indeed valid. Only then can we have the creative energy that characterizes outstanding boards.
Such an arrogance of excellence is particularly dangerous today. Although our colleges and universities are strengthening after the recession, I believe the ground has shifted under our feet. The old model of institutions increasing tuition at twice the rate of inflation and students willingly taking on ever more debt is irreparably broken. While enrollment is up at many colleges and universities, net revenue per student is flat. Students and their parents are taking less on faith. While they still appreciate that college is a time to grow in mind, body and spirit, they also want to know how their investment will lead to jobs and fulfilling careers. Trustees that fail to take these shifting sands into account do so at the institution's peril.
Needed: More, Not Less, Engagement
The antidote to an arrogance of excellence is continued (and revived) board engagement. In today's world, even with experienced presidents, board members need to be particularly vigilant about:
Demanding transparency. Board members should insist that presidents operate with a high level of openness that goes beyond traditional president's reports and dashboards of indicators. Seasoned presidents have a special responsibility to make sure these reports aren't stale or merely amount to a gazette of the college's accomplishments over the last year.
At the college where I serve as president, Augustana College, I provide our board with a 50-item dashboard of indicators. And even though an expansive dashboard of indicators is far superior to reams of reports, I fear it can make the board's job too easy. Too often board members skim over it, not taking time to look at both the positive and negative, or to peel back the layers on the numbers and their significance.
In my president's reports to the board, I've started to spend most of my time discussing those indicators that are red flags or have the potential to become red flags. To identify those troublesome indicators, I look for deterioration from previous years or significant differences from our peer colleges.
Creating a culture of critical analysis and inquiry. Almost without fail at every board meeting, I am asked—often in executive session—what keeps me up at night. It's a good question and one that's often the most difficult for me to answer. Sometimes what keeps me awake are external matters over which I have little control. I often find that board members have faced similar problems in their work and can shed a new light on them. Some nights' sleep is waylaid by internal challenges that run the risk of becoming Gordian knots. A frank conversation with the board about these issues usually does not yield an immediate solution, but it does provide useful guidance and support.
Occasionally what keeps me up at night is a decision I made that, in retrospect, was a bad call. A discussion with the board of how this happened and what can be learned is usually among the most valuable discussions of all.
Deliberately assessing outputs. Most college boards of trustees are focused on inputs, not outputs. They carefully monitor such inputs as credentials of admitted students, diversity at the college, student-faculty ratios, and net tuition revenue per student. In most cases, experienced presidents have proven track records with admission, fund raising, and financial management. As such, we have improved inputs.
But at one recent board meeting, I was asked how we knew that the nearly $100 million dollars that the college had invested in annual operations was making any difference at all in the lives of students. It is a fair question to ask whether the experienced president who has enhanced inputs has similarly enhanced outputs, like student-learning outcomes.
Inputs are convenient focal points because they're much easier to measure. But what makes a great college has much more to do with great outputs. At Augustana, our current strategicplanning process focuses on maximizing student learning as opposed to enhancing inputs. Success with this plan will be determined by measures such as the National Survey of Student Engagement and scores on the Collegiate Learning Assessment.
As important, however, will be surveys of student satisfaction and recent graduate satisfaction. Although students and alumni are sometimes ill-informed about the details of sound pedagogy, they are experts when it comes to measuring the value and the quality of the education they have received.
Continuously learning. Like our best faculty members, great board members engage in continuous learning. Yet those boards with successful, experienced presidents are often tempted to rely on him or her as the sole source of learning about the complexities and challenges of higher education. There are a number of ways to avoid that potential pitfall and enhance the breadth of a board's understanding.
At Augustana, we've added three board members who are, or were, faculty members at other colleges. Likewise, I've asked former college presidents from other institutions to facilitate retreat discussions, in order to give the board a broader perspective than mine. And nothing, in my view, broadens trustees' perspectives more than to invite a significant number of faculty members to our board retreat. Board members say that they enjoy learning from the faculty members, and they also comment that the interaction helps them understand the delicate dance of shared governance.
Rigorously evaluating the president. Even the most seasoned presidents need regular and meaningful evaluation. While it may be tempting to forgo a rigorous assessment after a president's contract has been extended, board members must not forego an annual evaluation of their institutional leader, with more comprehensive evaluations every three to five years. Even the strongest and best president has some years that are more successful than others. A long record of strong performance can be broken as a president faces personal problems or unforeseen institutional challenges. Likewise, in a few cases, longer-term presidents can sometimes start to think of the institution as theirs, no longer welcoming the oversight or criticism of other people. Those presidents usually isolate themselves in a way that makes them more prone to poor decision making. I view constructive criticism from the board as a tool to be taken seriously and a gift to be received gladly.
Renewing the board. The majority of Augustana's board members have been appointed during my term as president. Some might think that newer board members might be the most accepting of the decisions of the administration and its direction because their appointment was endorsed by the president. But I have found that not to be true. Newer trustees tend to take a fresh look at the quality of a presidency and are less likely to assume that success over the past years necessarily means success for the next years.
The Augustana board appoints trustees who have strong critical-thinking skills and aren't shy about expressing them. We encourage new board members to be actively engaged from the time of their first meeting, emphasizing that no question is unfair or out of bounds. The enhanced scrutiny of new board members, together with the sense of history of longer-serving trustees, creates a balanced mix for interacting with a president. At Augustana, eight-year term limits allow the board to continually renew itself.
Four Steps Towards Better Presidencies
Effective board leadership, through the board chair and a strong trusteeship or governance committee, is necessary to engage the board as I've described. Board chairs must clearly remind trustees that their duties have not changed merely because the institution enjoys the service of a seasoned president. The landscape of higher education is littered with colleges whose boards were charmed by a successful president into relinquishing their duties of oversight.
Working with Augustana's board chair, I've taken several steps to help the board engage me in a way that gives my administration the benefit of the doubt, while retaining strong oversight:
• I remind myself and our vice presidents that board meetings are not lectures; rather, they are more like class discussions. The board chair and I expect trustees to be prepared for meetings. And I admonish my vice presidents that our administration should listen more than talk—something admittedly not easy for experienced administrators to do—and should frame our presentations to draw out critical inquiry from the board.
• I encourage the board to meet in executive session without me. Many boards limit executive sessions to discussing the performance of the president, but I encourage board members to use the time to discuss anything on their minds. Successful presidents often have big personalities and a big presence to match. Board members, I believe, should have a safe space to discuss concerns in executive session as a way of being fully engaged. If those concerns are not discussed in executive session, they will probably be discussed in the parking lot in a much less productive way. Our board chair conveys the substance of those discussions with me, so that I might consider the issues raised and report back when appropriate.
• I encourage board members to have as much interaction with our vice presidents and faculty members as possible. That is contrary to the instincts of many presidents, but I have found it enhances board engagement. Each faculty member and vice president has a different take on the challenges facing the college. Those differing viewpoints enhance the marketplace of ideas in which good decisions are made.
• I deliberately engage the board's leaders in a candid discussion of my own leadership. Usually these are the ultimate questions that can make or break a presidency. Am I delegating too much or too little? Is our risk-tolerance in the same range? Have I appointed a team that trustees have confidence in? Are my measures of success the same as theirs?
Several of us mid-career presidents have observed that, early in our presidencies, we were tempted to admonish the board with the old saying, "Eyes in, fingers out." Now, with a little more experience under our belts, we're more tempted to say, "Eyes open and ready to engage." Increasingly, we want more board input, because we realize that, although we have been successful, we are operating in a very different world from the one in which we were appointed. Our egos might have been a bit fragile as "newbies," but our skins have now thickened. We are thirsty for board engagement in this constantly changing, sometimes frightening, but ever-exhilarating world of higher education.