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Business Officer Magazine

Partners in Parallel

NACUBO's corporate partners look at past developments that have shaped the CBO position, and the ways their companies' work with higher education institutions has tracked-and will continue to mesh-with those trends.

By Trae Turner

*The mission of institutions to deliver a great education hasn't changed significantly in the past five decades, but nearly everything has changed about how it's done. Fortunately, NACUBO's corporate partners provide essential support as the role of the chief business officer continues to evolve from one of accountant to that of strategist. That transition has been shaped by trends ranging from student activism in the 1960s to the economic pressure of the recent recession. Each decade has brought with it new complexities, as institutions differentiate themselves in the marketplace and respond to additional sweeping developments, such as technology, sustainability, changing student demographics, and international influences.

As the higher education atmosphere shifts away from the perceived slow-moving culture of academia to a more rapid-fire environment, CBOs are now at the forefront, leading the fundamental changes required in a postrecession world. Corporate partners provide tools and expertise to help make the leap to quicker decision making and to support strategic endeavors—most often in the overarching areas of strategic planning, technology advances, institution complexity, and purchasing power. Here's what they've been involved in lately.

Strategic Planning, Front and Center

One of the most significant hallmarks of change for business officers came as recently as 2004, says Mark Olson, IBM account manager for the U.S. Department of Education (and former executive vice president and chief operating officer at NACUBO). Under the leadership of former Comptroller General David Walker, the U.S. General Accounting Office changed its name to the U.S. Government Accountability Office. With that shift, explains Olson, "We also saw a significant change in the role of the CBO. The move from a focus on accounting to accountability transformed the job of the CBO from reporter to analyst."

"Corporate partners need to provide better and faster information to the decision makers."

Ralph Maier, E+I Cooperative Purchasing

The new emphasis put the focus on determining strategic intention and helping institutions plan and predict a more successful path. "The role of the CBO now more than ever-as a leader on the president's cabinet-is to help analyze data and use it to make decisions," says Olson. "IBM has made significant investments in business analytics technology as well as acquiring companies that do this kind of work. We're making tremendous efforts in higher education to help institutions develop balanced scorecards, manage assets, achieve goals, perform budget and risk analysis, and improve business operations."

  • Shared services from several sources. Olson points out that another strategic direction in which higher education CBOs can lead the way is in facilitating shared services. As an alternative to spending for separate systems or services, colleges and universities can participate in collaborative efforts, such as the Boston Consortium, where 15 institutions share risk management, recruitment, and internal audit services. Collaborations such as the community-sourced Kuali Financial System also offer opportunities for significant savings and continuous improvement. "Whether it's outsourced, open-sourced, or shared services," says Olson, "these are the strategic trends that CBOs are contributing to."
  • Quantifying results. There's no doubt that economic trends are changing parent and student expectations of higher education. "We're seeing changing models," explains Olson. "With the passage of the No Child Left Behind Act and increased attention to outcomes assessments, analysts and policy makers began to take a new look at how the value of higher education could be measured. Will students and families continue to make the significant investments needed for a college education without knowing the outcomes?" asks Olson. If employment is thought of as one of the principal "ends" for education, then the means of getting that education begin to take root at a much earlier stage, with high school completion the key component in moving upward on the education track—and eventually to a job and career.

In an interesting reflection of this changing landscape, IBM is partnering with educators on projects like P-TECH, a collaboration with the New York City Department of Education, City University of New York, and New York City College of Technology, where a unique model for grades 9-14 has the goal for its student population of 100 percent completion of an associate's degree within six years (See sidebar, A Public-Private Partnership". The bottom line: Mentoring and connections with the "real" workplace give participating students a better chance of landing jobs after graduation.

Technology Marches On

Although economic and social trends have heavily influenced higher education and the role of the business officer, Frank Kurre, national managing partner for higher education at Grant Thornton, contends that the biggest transformation continues to come from evolving technology tools and upgrades. "Although the economy has inspired belt-tightening, which has resulted in delayed capital campaigns and construction projects," says Kurre, "we are seeing many institutions begin the quiet phases of capital campaigns and the beginnings of extensive construction and renovation planning." Now, he explains, there's a shift from fundraising aimed at permanently restricted scholarships and endowed chairs to more flexible funds to invest in technology and student life on campus. "Institutions are using such capital campaigns, along with surpluses from operations and additional borrowings to fund these investments," explains Kurre.

On the tech side, "education is becoming 'anytime, anywhere,'" says Kurre. "You see even the most prestigious institutions offering online courses for their students."

A recent example: Harvard University and Massachusetts Institute of Technology (MIT) announced in May a new nonprofit partnership, known as edX, to offer free online courses from both institutions. According to a New York Times article ("Harvard and MIT Team Up to Offer Free Online Courses," May 2, 2012), "Harvard's involvement follows MIT's announcement in December that it was starting an open online learning project, MITx. Its first course, Circuits and Electronics, began in March, enrolling about 120,000 students, some 10,000 of whom made it through the recent midterm exam."

  • Change of heart. Kurre agrees that economics coupled with the availability of education from anywhere inspires a practical approach for parents and students. "They now want to know: 'What happens after graduation?'" he says. The liberal arts emphasis of "developing the whole person," Kurre says, is giving way to a focus on "what job will I get?" With that kind of laser focus coming from higher education customers, graduation—in a field with direct business application—is becoming much more desirable. Kurre notes that technology has so radically changed higher education that he wonders whether the traditional, and expensive, campus experience will be replaced with new approaches that focus less on investing in real estate and more on developing flexible campus operations that can be leased or moved as distance learning and other technology investments continue to flourish. Schools must change their dynamics, and business officers clearly see the need to revise strategic plans to support the technology that keeps top-quality programming and service at students' fingertips.
  • High-tech competition. "It's a different world because of demographics and international competition," Kurre points out. India, China, and South Korea continue to increase the number of students they are sending to the United States, while many foreign countries are also looking at expanding their own university systems or sending students to countries other than America that also have strong academic programs. Alternatively, American universities are running campuses and programs throughout the world that go way beyond the traditional study-abroad programs, raising institutional risk substantially. For-profit universities are also on the rise, competing strongly with nonprofit institutions and generally tapping into federal financial aid for their students. This brings with it another economic model in which even professors' jobs and salaries are based on performance, says Kurre. "It's a different dynamic that provides access to other forms of capital, negates the need for an endowment, and allows institutions to operate more efficiently," says Kurre.
  • Revenue alternatives and other assets. Another trend that Kurre sees CBOs navigating is increased pressure from local municipalities that expect institutions to pay taxes; payments in lieu of taxes; and fees for services, such as water, fire, and police. Kurre points to Brown University's recent agreement to make $31.5 million in payments to its home city of Providence, Rhode Island over the next 11 years, a precedent that may well be cited by many other cities in the future. Since Brown is a nonprofit university, the payment was voluntary, but other schools are wise to anticipate such costs, suggests Kurre, and build them into future budget plans. This speaks, again, to the expense of a campus-based education versus—or combined with—virtual, or long-distance, education that could bring in additional revenue.

Clearly, the recession has already driven an ongoing need for alternative revenue streams, with some obvious areas of opportunity including distance education, planned giving, research development grants, and use of facilities in off-peak times.

Complexity Comes of Age

According to Edward Van Dolsen, executive vice president and president of retirement and individual financial services at TIAA-CREF, complexity has become the overlying driver of change for the role of the business officer. "Technology is a big part of that. Students anticipate immediate adaptation of technology and infrastructure, an expectation that requires a higher level of financial sophistication to make more complex investments." This also makes the margin of error smaller, a dynamic that Van Dolsen says requires providing more turnkey solutions to business officers who focus on administration, records, and funds. Consequently, says Van Dolsen, "we've made significant investments to strengthen technologies, services, and recordkeeping abilities as well as comprehensive fiduciary and compliance support."

In addition to their traditional roles, notes Van Dolsen, many CBOs provide leadership and vision, as their institutions navigate evolving social change—diversity issues, employee work-life balance, retention, and recruiting. "Generally, the CBOs I know rely on a unique blend of creativity, entrepreneurial spirit, and collaboration to keep the institution vibrant and moving forward."

Decisions on the double. "The speed of decision making has had to increase in a community that is used to a lot of debate," says Van Dolsen. "The business officer sits in the middle, needing to make rapid decisions while operating in an environment conditioned to respond with much more deliberation than speed."

Time-consuming tasks. Van Dolsen sees business officers also dealing with increasing complexity in many other areas, including:

  • Retirement needs. As the economics of each institution have diversified throughout the years, Van Dolsen finds that retirement needs have followed suit. "We work with institution leaders to customize specific investment models and help administer them, a task that is increasingly more complex as each institution evolves. Our experience shows that engagement is key to driving better outcomes for institutions and their employees-and their plans. For our part, we need to fully understand the needs and desires of all employees throughout their life stages."
  • International influence. "Whether it's urban New York University, large rural Pennsylvania State University, or smaller Dickinson College, in Carlisle, Pennsylvania, many institutions have expanded their international focus," says Van Dolsen. The result is additional risk and cost, which both require the CBO's ongoing involvement.
  • Government regulations. Van Dolsen also points to the trend of regulators requiring administrators to adhere to more-intricate compliance procedures. Whether it's managing and reporting the activities of the significant number of veterans returning to college campuses or weighing in on the burdensome requirements of the IRS Form 990, compliance efforts take more and more time and effort on the part of the business office. "We've had to adapt our company service model accordingly," he says.

Increased expectations. As pressures push business officers to bring costs down, student—and sometimes parent—expectations have risen in terms of services and amenities. Similarly, the demand for individual retirement planning counseling services for faculty and staff has risen. Van Dolsen points out that people don't make decisions based simply on data; they want a person to help them understand their retirement plan; they want objective advice available online, on the phone, or in person. "The demand for counseling, education, and packaged solutions has increased as retirement complexity has increased," says Van Dolsen.  "We've advised some cost-efficient services, often for small institutions, including video and web conferences."

Power Purchasing

Since products and services constitute one of the largest parts of an institution's budget, "Schools can leverage their procurement capitalization and see buying power as a strategic priority," says Ralph Maier, vice president at Enterprise Solutions Group (ESG), a division of E&I Cooperative Purchasing, an educational buying cooperative.

Stretching every dollar is coupled with the need to improve process efficiency, or streamline operations. It's all about complementing your own staff with external business partners to redeploy internal resources to gain higher value, says Maier. "It's a culture change from the comfort of the past to carefully managing risk with efficiency. The transition challenges CBOs to get more out of what they have."

Collaborate to economize. A big part of doing more with less comes from cooperative purchasing-looking at other business partners to see how both can maximize their dollars. For instance, Maier points to Stanford University's William Cooper, associate vice president and chief procurement officer, whose team spent time with faculty and staff to identify and meet the needs of his division's clients across campus.

Stanford's procurement department found not only that technology could quickly change the nature of those needs, but that the right purchases often make for better results and more efficiency. For example, purchases for media storage changed from arranging to store archives with various companies that rented space for hard-copy files to procuring imaging and scanning services that could digitize material for storage on a remote server (see sidebar, "Shopping Lists Then and Now," for more examples).

While many institutions are increasing their adoption of cooperative contracts, Maier recognizes that a large number of schools are using procurement to focus on other priorities, such as sustainability: "The challenge is to meet sustainability goals while remaining fiscally responsible." Maier points out that colleges and universities actually can purchase environmentally friendly products, which sometimes cost more, at a lower price if products are purchased in bulk, which usually means collaboratively. "In many cases, sustainable products can be cheaper than traditional products when purchased this way," explains Maier.

Think, and Think Again

Dealing with changing pressures takes creative problem solving, says Maier. For example, Ron Coley, associate vice chancellor for business and administrative services at the University of California-Berkeley, certainly feels the pain, in a state where funding has been particularly scarce. "We consulted with UC-Berkeley on projects to streamline administration," says Maier. "The university's Operational Excellence initiative is an example of 'out of box' thinking." This framework for conducting a comprehensive diagnosis of the campus's operational and financial environment is designed to pinpoint cost-saving opportunities that lead to proposals for shared services and cooperative purchasing.

Collaboration between communities in urban proximity is another trend that Maier believes will continue. "There is no longer a barrier to change when it comes to working together on procurement. It's a matter of survival," says Maier.

Today's challenge, says Maier, is that in many cases adaptations to the recession have been cosmetic—or thought of as a short-term necessity. But we really need fundamental change. "Business as usual no longer cuts it. You have to change your strategic intent," Maier says. In terms of procurement, it's not so much about what you buy, as how you buy it.

For this and other priorities, says Maier, corporate partners need to provide better and faster information to the decision makers. For E&I's part, online contract and RFP templates are standard. But the company's unique tool is its Strategic Sourcing Committee made up of higher education procurement and information technology professionals who give constant feedback from the field on how the trends in purchasing are changing (see sidebar, "Equipment Evolution"). In this way and many others, corporate suppliers to the higher education business continue to be trusted partners of the colleges and universities they serve—perhaps now more than ever.

Trae Turner, Charlottesville, Virginia, covers higher education business issues for Business Officer.

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A Public-Private Partnership

Connecting high school, college, and the world of work through dynamic partnerships, P-TECH (Pathways in Technology Early College High School) is a unique grades 9-14 model, where the goal for its diverse student population is 100 percent completion of both a high school diploma and an associate's degree within six years. Through an emphasis on technology and work-readiness skills, P-TECH establishes a public-private partnership among the NYC Department of Education, City University of New York, NYC College of Technology, and IBM. One of the unique aspects of the new program is that it pairs each student with an IBM mentor who helps the student learn about the technology industry.

Initiating P-TECH'S plan in 2011, Mayor Bloomberg said, "I'm excited to announce a new partnership we've entered into with IBM and the City University of New York, and it's the first of the kind in the country. ... All students will learn the traditional core subjects, but they'll also receive an education in computer science and complete two years of college work. When they graduate from 'grade 14' with an associate's degree and a qualified record, they will be 'first in line' for a job with IBM and a ticket to the middle class, or even beyond."

Since that announcement, a steering committee has met regularly to plan the important aspects of the school. The group grew over the year to include additional staff from each of the partners as well as P-TECH Principal Rashid Davis, who took the lead in planning key elements of the school design, including staff selection and hiring. The school will add a class of roughly 100 students each year, growing to enroll between 400 and 450 students on site by school year 2014–15.

According to Davis, "P-TECH also represents new paradigms in American education-a public-private partnership that blazes a pathway from high school through college to careers, a hybrid of high school and college that enables the creation of that pathway, and a repeatable model that any community can follow to connect education to employment." Following New York's example, Chicago will open five 9–14 schools this fall, and Mayor Bloomberg announced plans for three more schools in New York.

Read more about P-TECH at

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Long-Term Partners

Some of NACUBO'S corporate partners have been "partners in parallel" for more than 25 years, including:

Corporate Partners and Business Partner Members

  • Bank of America Merrill Lynch (formerly Merrill Lynch)
  • Commonfund
  • Fayez Sarofim & Co.
  • Fidelity Investments
  • Goldman Sachs & Co.
  • IBM
  • J.P. Morgan & Co.
  • John W. Bristol & Co.
  • KPMG (formerly Peat, Marwick, Mitchell & Co.)
  • PricewaterhouseCoopers (formerly Coopers & Lybrand)
  • State Street
  • Wellington Management Co.


  • ABM
  • ARAMARK (formerly ServiceMaster)
  • Ellucian (formerly Datatel)
  • Follett Higher Education Group
  • Sallie Mae
  • Valic
  • Wells Fargo (formerly Wachovia)

This list represents only a portion of NACUBO's corporate partners.

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Shopping Lists Then and Now

A comparison of today's campus purchases to items institutions were ordering a decade or more ago is clear evidence of the speed in which technology is transforming tools and processes—and hence the procurement office. According to William Cooper, associate vice president and chief procurement officer at Stanford University, California, even a cursory list of continually improving products would make for some interesting contrasts, including these:

  • Audiovisual projector makes way for media bundle that includes touch-screen monitor, wireless projector, and retractable screen.
  • Cars, buses, department transportation evolve into energy-efficient vehicles and systems.
  • Manual, bulky athletic equipment is replaced by upgraded, space-efficient digital machines.
  • Chalkboards made obsolete by whiteboards with printing capabilities to capture everything written on them.
  • Textbooks shoved aside by iPads, e-readers, and e-books.
  • Landlines go the way of the dinosaur; fiberoptic cable service becomes ubiquitous.
  • Mice for research testing are replaced with mice bred with specific qualities related to medicine, disease, and genetics.
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Equipment Evolution

As a member of E&I educational buying cooperative's Strategic Sourcing Committee—a group, including college and university procurement professionals, that advises on cooperative purchasing—I see many changes in the commodities needed to meet campus needs.

One of the most significant shifts at my institution (Colorado College) over the past several years is the change in equipment based on new and ever-changing technology, specifically in the way we address campus printing needs. Until two years ago, the information management services department supported and maintained campus printers, while the purchasing department managed copiers. Each department had separate and distinct processes, which weren't designed to be holistic or strategic in addressing the issue of spending. For example, end users mistakenly thought that buying an inexpensive printer and purchasing printer supplies was less costly than using the charge-back model (cost per copy) for copiers.

With the evolution of more complex, networked devices and the ongoing improvements to printers and copiers, we explored the possibility of marrying the copier and printer programs. After deliberation and discussion, we initiated a Managed Print Program for the campus in January 2012. Although we are in the fledgling stages of implementation, the specific goals for rollout are very clear:

  • Reduce the number of machines (copiers or printers) on campus.
  • Increase functionality of new equipment, which is to be strategically placed based on department locations, volumes, and other factors.
  • Minimize our carbon footprint.
  • Reduce paper usage by setting the duplex function as a default on all available machines.
  • And, of course, save money.

So far, we have captured good learning points during the first several months and plan to continue with phased-in implementation to ensure end-user satisfaction and success, buy-in, and acceptance for the initiative.

GINA ARMS is director of purchasing for Colorado College, Colorado Springs.

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