NACUBO's 2016 National Profile of Higher Education Chief Business Officers, with support from TIAA, is available free online. In addition to demographic characteristics, the report sheds light on the higher education chief business officer profession, including the makeup of individuals currently filling this role, core job responsibilities, and career pathways leading to the CBO job. The 2016 National Profile builds on previous surveys conducted in 2010 and 2013. The triennial survey of CBOs at U.S. colleges and universities should enhance understanding among college and university presidents and other sector leaders about the unique skills and expertise business office executives bring to their institutions and what is required for aspiring CBOs.
Based on 2016 survey responses, the "typical" top business office leader is a married white male, about 56 years old, earning an annual salary of between $150,000 and $300,000, who has been in his current position for about eight years, and has spent most of his career in higher education. While this general description of a campus CBO has changed little since the inaugural 2010 study, indications that significant retirements of senior CBOs are looming in the near term could begin to shift these demographics for future surveys. In light of this, new to the 2016 survey are questions related to CBO succession planning activities.
Outlined below are a handful of important observations about the higher education CBO position based on 2016 National Profile results. For the complete picture, including in-depth analysis and tables, be sure to download the full report and supplementary resources that provide additional context to the report's data (see sidebar, "CBO Pipeline Resources").
Higher education CBOs perform a range of duties for their institutions. It should come as no surprise that the vast majority of respondents said they are responsible for the budget and financial planning of their institutions (98.5 percent) and have controller (94.1 percent) and bursar (83.2 percent) responsibilities. Approximately three out of four business office leaders also named as a core function oversight of auxiliary services (up by nearly 5 percentage points since the 2010 survey), and about 70 percent of survey respondents noted their work with institutional investments and the institution's endowment (up by just over 10 percentage points since the 2010 survey).
Roughly half of responding CBOs also have responsibility for internal audit, public safety, and administrative technology. "Other responsibilities" listed in a write-in section of the 2016 survey captured a broad range of activity, including athletics, facilities management/operations, physical plant, real estate operations, bookstore operations, financial aid/admissions, legal affairs, diversity offices, Title IX compliance, museums/performing arts centers, and research administration. With regard to managing staff, approximately 82 percent of respondents said they supervise between four and 10 direct reports.
As if these responsibilities didn't consume enough of a busy CBO's day, many survey respondents indicated they also spend time serving organizations external to their institutions. For instance, about 38 percent are board members of nonprofit entities, such as hospitals, social service organizations, and charitable and religious organizations; a little more than 17 percent said they serve on boards of higher education or professional organizations; and roughly 9 percent serve as board members for their local chambers of commerce.
MOST IMPORTANT ROLE
Asked the question, "Besides managing the institution's financial resources, which aspect of your job do you believe is the most important?," the response of "strategic thinking and decision making" (31.8 percent) was the most popular cited, followed by a near tie between "leading change and fostering innovation" (16.8 percent) and "supporting president and managing up" (16.1 percent).
When asked about their level of job satisfaction, an overwhelming majority of survey respondents (86.7 percent) were "very satisfied" or "satisfied." Yet, those "very satisfied" represent a decline of 9.3 percentage points since the 2013 survey, while those "satisfied" rose 6.6 points since 2013. Meanwhile, the 13.3 percent of 2016 survey respondents indicating they are "very dissatisfied" or "dissatisfied" in their jobs represents a 3 percentage point increase since the 2010 and 2013 surveys. Worth noting is that no significant differences in job satisfaction levels were detected based on gender or type of institution served. That said, the report's authors suggest the slight uptick in job dissatisfaction is an area that bears watching.
As for the most important CBO retention factors, a new answer choice provided in the 2016 survey topped the list: institutional "integrity/ethical mission/culture" (40 percent). Other selections included "ability to implement change" (24.7 percent) and "appreciation/respect" (19.8 percent). Among other important factors for staying in the job that respondents noted in a free-response section of the question were additional staff (specifically for compliance with unfunded mandates), ability to contribute to the institution, and professional challenge/personal growth.
Among the biggest job frustrations cited by 2016 respondents were "culture that resists change" (27 percent), followed by "never enough money" (25 percent). Free-response answers to this question showed frustrations related to resources, institutional culture, external entities, and lack of time and staff.
The 2016 National Profile also examined the career paths of higher education CBOs, including how much of their career had been spent within the postsecondary arena. For instance, most respondents had spent at least half of their careers working for colleges, universities, or related entities and many had spent nearly their entire careers doing so. Overall only about 17 percent of current college and university CBOs reported having no prior experience working in the sector before landing the top business office leader position. The full report delves much more deeply into differences of career paths by gender and institution type, among other criteria. Tracking these shifts is important for a host of reasons, including helping identify the potential CBO pipeline.
For the first time, the 2016 National Profile collected data about CBO salary levels. While responses from survey participants indicate that about half (53 percent) of higher education business office leaders earned annual salaries between $150,000 and $300,000, institution type and gender are among the factors contributing to earnings above and below this range.
Approximately 18 percent of CBOs hailing from four-year public institutions made between $300,000 and $500,000, while 11 percent of those at private nonprofit colleges and universities and less than 0.1 percent at community colleges fell within this higher salary range. By contrast, CBOs earning less than $150,000 annually included almost 73 percent of those from two-year public colleges, 29 percent at private nonprofit institutions, and about 11 percent of four-year public institution CBOs.
Substantial differences in CBO salaries were also evident based on gender. Whereas approximately 12 percent of male CBOs earned between $300,000 and $500,000, only about 6 percent of female CBOs earned salaries in this higher range. By contrast, 45 percent of female CBOs earned less than $150,000, while only 31 percent of their male counterparts reported earnings in this lower range. The study's authors caution that closer examination of these salary discrepancies by gender may be required in future studies to account for other influencing characteristics, such as education levels and years of experience.
Since the 2010 National Profile, the percentage of current higher education CBOs at or above the traditional retirement age of 65 has nearly tripled from 5.4 percent to 14.4 percent in 2016. Among the 2016 survey respondents, nearly 44 percent said their next career move is to retire. About 10 percent of CBOs planning to retire would like to do so in less than one year (compared with 6 percent in 2013), and another 34 percent anticipate retiring within the next three years.
Recognizing that institutional leadership must begin to address an impending exodus of experienced CBOs, the 2016 National Profile included a new section of questions about CBOs' succession plans with regard to "a process for identifying and developing people with potential to fill key leadership positions within the organization." An overwhelming majority (82.6 percent) of survey respondents said they consider succession planning "important" or "very important." When asked separately about the relationship they perceived between succession planning and long-term institutional viability, 70.8 percent said it was either important or very important. Furthermore, approximately 69 percent consider diversity and inclusion as "important" or "very important" factors in the succession planning process.
That said, it appears that most institutions do not have formal plans for succession of retiring CBOs, with only 2.8 percent of respondents saying their institutions have formal, written strategies in place to fill their jobs. Close to 11 percent indicated a "somewhat formal" plan in place. And while more responded that their institutions have an "informal" (32.3 percent) or "somewhat informal" (16.1 percent) succession plan in place, more than one-third (37.3 percent) of survey respondents said no plan, formal or informal, exists for filling their position.
As to the reason so many institutions lack a formal succession plan, respondents offered some clues: "not a priority" for campus leadership (13.2 percent); "no time to write one" (7.3 percent); or a "weak bench" (4.8 percent). Additional write-in responses included:
- Cultural issues (e.g., formal plans are not part of institution's culture).
- HR issues (including open search laws).
- Changes in the president and/or board of trustees.
- Succession planning is solely the responsibility of president and board of trustees.
- Philosophical disagreement on necessity of succession planning.
Respondents did suggest what they consider the most important aspects of a succession plan. The top-ranking answer, cited by about one-third of respondents, was professional development and training, along with appropriate qualifications (14.9 percent) and identifying potential successors (13.6 percent). Some respondents suggested the need to develop a team, not only individual candidates, to step in to fill core CBO functions. While much more work must be done, succession planning does appear to be on the radar of survey respondents, who identify a strong need for a broad approach through mentoring, skills-based training, and professional development.
Karla Hignite, editorial consultant to NACUBO, is editor of NACUBO's HR Horizons; e-mail: email@example.com