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Reading Your Metric 'Gauges'

Savvy financial aid directors use metric 'dashboards' to track what's really important

Ever ask financial aid directors how they spend their working hours? There's no standard answer to this question, and the broad range of responses might surprise you. That's due in part to the size and complexity of the institution-that is, total enrollments and the number of different populations that the financial aid office serves (e.g., undergraduate, graduate, professional; part-time/full-time; transfer/freshman; independent/dependent). But it's also a function of institutional control (i.e., state-supported, private, or for-profit).

Still, regardless of these factors, there is a common denominator in managing today's financial aid office, and that common denominator is metrics-the data and trends that need to be maintained, monitored, analyzed, and routinely compared, in order for you to know if you are actually doing the right things, and if you're doing them the right way. To put this in the form of two questions you could ask yourself: Are you utilizing data to conduct formative and summative evaluation in an ongoing, continuous way? Are you including longitudinal analysis required for a "vision with precision" of how things are changing? You'd better be, because there's only one constant in the world of financial aid, and that constant is change. Don't believe us? To prove this point, we asked two veteran chief financial aid officers to run through an exercise, and break down precisely how they spend their working time.

Shirley Ort is the associate provost and director of the Scholarship and Student Aid Office at the University of North Carolina-Chapel Hill. The university has over 25,000 students (15,800 undergrad and 9,600 graduate and professional students). Fifty-three percent of the undergraduates receive financial aid, as do 44 percent of the graduate and professional students. Ort reports that 30 percent of her time is devoted to forming policy through data-or, stated another way, in research and policy development. In this role, she is working with state legislators, governing board members, senior administrators, and the faculty in order to be sure that all the stakeholders are properly informed and educated about current and future student financial need. Access is a very important, even foundational, priority at Chapel Hill, she points out. Another 30 percent of her time is spent "moving things forward" in both the financial aid office and, more broadly, across the institution. Finally, 30 percent of her time is dedicated to working on the area of scholarships, troubleshooting, improving workflow and systems, and working with Development to make the case. Without a doubt, the three major tasks consuming 90 percent of her time are all based on having accurate, timely, and understandable data.

Putting metrics into place may seem overwhelming,
but most are one-time development efforts that can
be placed in your regular production schedule.

Troy Martin, director of Student Financial Services at Houghton College, spends his time quite differently. Houghton is a relatively small liberal arts school, located in southern New York state. The college has a total of 1,350 students, 1,200 of whom are traditional college age, the other 150 adult degree-seeking students. Seventy-five percent of the students receive Houghton College money, and the financial aid office produces almost 1,200 awards a year.

Martin spends more than 50 percent of his time providing personal attention to individuals: both internal campus constituencies (including his own staff of five), as well as external "customers" (students and parents). About 25 percent of his time, he says, is spent on packaging financial aid awards. The remaining 25 percent includes such things as making sure Houghton is in compliance, and participating in professional associations. Yet, a most important segment of that time, Martin reports, is spent contributing to the strategic discussion on campus regarding how Houghton should allocate its financial aid resources to meet enrollment goals. Once again, the quality and accuracy of his efforts are dictated by the availability and usefulness of good data.

Although clearly, the data needs of financial aid offices will differ (just as the activities of directors of financial aid differ), there are some metrics useful in any aid office for tracking and managing the use of institutional resources over time, and benchmarking with other appropriate IHEs. At any institution-regardless of size, complexity, and institutional control-a financial aid "dashboard" would include the following 12 items, completed with the help of Mike Bartini, director of Financial Aid at Brown University:

1-Aid expenditures by type of aid (institutional scholarships/grants, state/federal grants, loans, work awards, etc.). This report is typically produced yearly by financial aid offices, and provides a solid means of monitoring changes in funding sources over time.

2-Profile of students (segmented by undergraduate, graduate, and professional), noting those students eligible for merit versus need-based aid, need levels versus costs, and so forth. Such data provide ongoing information about the percentage of students receiving institutional aid, the percent of students showing need, etc.

3-Number of undergraduates with unmet need, and average amount of unmet need (segmented by resident and non-resident tuition payers for state-supported institutions). This provides a measure of accessibility; a factor central to the mission of many institutions, especially those that are publicly funded.

4-Number of students employed on campus, average earnings, and number of hours worked per week.

5-Debt levels of graduating seniors, and default rates on both Perkins and Stafford loans.

6-Admits, enrollees, and yield rates for freshmen and transfers by need level, quality, and amount of grant (in-state versus out-of-state, for institutions with different resident and non-resident charges). Such reports should be used annually to recalibrate awarding strategies. (Note: It is particularly important to maintain historical records for offers made to students who didn't enroll, as well as those who did enroll, in order to be able to accurately calculate yield rates by aid offer.)

7-Number of freshmen, transfers, and total undergraduate enrollees, and average net tuition revenue (NTR) they generate. Ideally, the new student data would be further segmented by such factors as quality, geography, ethnicity, and need groups. Over time, this information will enable the institution to understand trends in net tuition revenue generated as prices increase. The various segmentations suggested would be useful in monitoring trends among specific populations as well as in community discussions regarding tradeoffs between enrollment goals. (Note: Tracking success rates for transfers vs. freshmen can help you make decisions regarding where to invest your resources.)

8-Freshman, transfer, and total undergraduate discount rates. Discount rates are calculated by dividing total tuition and fee revenue by institutional financial aid. Division I athletes (total grant-in-aid recipients) and faculty/staff tuition remission recipients should be excluded from both the calculation of tuition revenue and the calculation of institutional aid, as they are fully funded under special programs having nothing to do with the generation of net tuition revenue. Restricted and endowed funds, as well as general institutional resources, should be included in the calculation of institutional aid. Until the last five years or so, discount rates have been hot topics exclusively for private, independent higher education. Today, because of reduced state support, increased out-of-state tuitions, and financial aid expenditures (both in and out of state for the best and brightest), discount rates have become a universal focus in higher education.

9-Freshman cohort profiles of students who stay, versus those who leave. This detailed retention analysis will shed light on what student characteristics may be related to attrition. The analysis should include financial-aid-related information (need level, amount of unmet need, changes in aid from year to year, scholarship eligibility, etc.) as well as academic data, in order to enhance the institution's understanding of the role financial aid plays in retention.

10-Competitor data on sticker price and quality profile should be updated annually to understand the relationship between stated tuition/fees and acceptance rates, average SAT or ACT scores, rankings in U.S. News & World Report, freshman discount rates, etc.

11-Projecting aid resources. Keep senior administration aware of any economic trends that may change the need profile of new or returning students.

12-Tracking the number and type of appeals (e.g., loss of job or medical issues), as well as institutional response (e.g., increase loan, grant, or no change).

Yes, at first glance, putting these metrics in place may seem overwhelming. But most are one-time development efforts that can then be placed into a regular or annual production schedule. And if you are familiar with financial dashboards as individual numbers meant to capture the real "essence" (and you find the liberty taken with these more expansive "metrics" excessive), think about this: The financial aid dashboard is a tool, not an end unto itself. It is intended to help inform institutional leadership as well as provide timely information for midcourse corrections. Unlike the dashboard we're most familiar with, the indicators on this dashboard should flash before there's a problem. U

Kathy Kurz and Jim Scannell are partners in the enrollment

management consulting firm, Scannell & Kurz, Inc.


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