Address by the Rev. Dennis H. Holtschneider, C.M., to the VISION twenty12 Leadership Congress
May 12, 2006
If anyone ever points to the official ending date for a strategic plan, March 4, 2006, was as good a day as any to declare that Vision 2006 had come to a close. For it was on March 4, that the university's board of trustees unanimously accepted and approved the work that this university community had done in writing a new strategic plan. This offers an opportunity for reflection and evaluation. On balance, I believe we can declare Vision 2006 a success:
- The plan was largely accomplished. We grew beyond anyone's wildest expectations.
- We built the students wonderful facilities that are frankly envied by our competition.
- The new tuition enabled us to hire first-rate faculty, from some of the finest graduate schools in the nation.
- We expanded our outreach to first-generation students, students of color and students from poorer backgrounds.
- We became nationally known for delivering degrees to students of color, listed among the very best in the nation.
- We became known for being a "College with a Conscience," ranked as among the best in the nation for service learning, and recognized throughout much of the city for the enormous contribution that faculty and students make in the community.
- Our students reported that they were the happiest in the nation. Numerous other organizations ranked us highly in many categories.
- Several of our units grew toward national prominence. Our music and theatre schools are recognized as among the best in the country by their respective industries. Our entrepreneurship center, evening MBA, programs in intellectual property, health law, psychology, philosophy, and School for New Learning are ranked or acknowledged as outstanding programs. CTI recently sent a team of students to international competition, where only three U.S. colleges emerged in the top 20 worldwide: Princeton, MIT and DePaul.
We have much to be proud of from the work of these past six years.
That said, we know well that DePaul has faced numerous challenges in recent years. For the past two years, DePaul has been taking corrective action. A lot of it:
- We cut 165 positions from the organization, a decision that had to be made, but one that introduced fear, anger, cynicism and a loss of confidence into the organization, and cost the organization some talent.
- We cut budgets, sometimes drastically. Some of these cuts, unfortunately, were detrimental to DePaul's long-term health, such as marketing and advertising, but overall the cuts brought the organization into a stronger position.
- These cuts enabled us to incorporate substantial debt service into our operating budget
- We incorporated annual capital investments into our operating budget so that we could pay for items as we go, rather than through additional borrowing.
- We sold off bad investments, preventing further losses at Barat and Discovery Ridge.
- Worked to get control of spiraling health benefits that threaten the institution's viability and quality in the long-run.
- We refinanced our debt at more favorable rates, and evened-out the payment schedule.
- We created a transparent budgeting process that gives everyone in the organization a sense of participation and confidence in the numbers and decisions.
- We instituted budget parameters for fiscal discipline.
- We imposed numerous internal controls, including such simple matters as requiring receipts to document expenses.
- We instituted standards for the Board of Trustees, including basic standards of attendance and philanthropy.
- We've done substantial work in rebuilding the advancement offices.
- We're rebuilding relationships with the business and governmental communities, and rebuilding ties to our alumni.
- The College of Commerce and CTI have taken proactive and effective steps to begin to turn around their enrollment losses.
- The Law School has successfully begun to reverse its lowered entry standards, working toward to recovering its former reputation.
All of this was good work. It was hard work, and the organization had to absorb hard decisions. But it did, and we are stronger today because of it. The Finance Committee recently applauded the university community at their meeting, acknowledging the turnaround of financial results that DePaul has achieved as well as the hard work of all those who helped achieve it. We successfully managed and held off some serious threats to the institution's long-term health and strength, and better positioned the organization for a stronger future.
There is much to be proud of in this work as well.
It will not surprise you, of course, to hear me tell you that there more challenges ahead that we must face. Here are 10:
- Our profitability has increased markedly, but our enrollment is slipping. In truth, it's slipping less today than it was a year ago, but our enrollment trend is not yet positive.
- Our competitors continue to challenge us in the marketplace with new programs, higher standards and better marketing.
- There are new entities providing education electronically, and we must both decide how to maintain our core business against such competition, and decide the degree and manner in which we will enter that competition directly.
- DePaul's endowment represents about eight months of the operating budget—a vulnerability that became only too real for many of our sister institutions in New Orleans this past year—and an amount that is far below the generally accepted standard of having an endowment that is twice your operating budget.
- The federal and state governments are equivocating in their support of educational aid. While it appears that the recent changes in Congress to student loans will have a more modest affect on our students than at first proposed, our intention to remain an institution in which students from families without great means can receive a great education will require us to develop additional strategies to support this mission.
- The world and workplace is becoming more globalized, and DePaul's students are not trained well to succeed and compete in this venue.
- Rising health care costs, fuel costs and others are putting enormous pressure on the organization to cut student services and moderate salaries in a way that DePaul is losing some ground in its relative ability to compete in the marketplace. We are absorbing these costs and cutting our way toward lower quality. We have not sustained irreparable harm to date, but the organization cannot continue in the long run to keep absorbing these rising costs internally. We will be forced to cut academic quality. It is not true that you get more with less. Once the fat is trimmed, you get less with less.
- Our enormous growth has imbalanced DePaul financially. We grew our traditional freshman class and lost relative ground in the adult and transfer market. That cut overall profitability and makes us more vulnerable to enrollment fluctuations.
- We must be honest with ourselves, that while we have pockets of true excellence —some of which I listed earlier—our overall academic profile is strong but not in a stellar kind of way. ESPN commended us this spring during the DePaul-Syracuse game for having a "fine academic reputation." That is true, and I was glad to hear someone in the popular media say it. We are entirely respectable, but we are not outstanding overall. When you ask people to list the finest Catholic Universities, they never list DePaul—they mention Boston College, Georgetown, Holy Cross, Notre Dame. Those who are in the know add St. Thomas Aquinas in California. Honestly, when asked for "the best Catholic universities," people never list DePaul. They are even surprised when they learn that we are the largest. We simply aren't on their collective radar screen.
- Even here in Chicago, where DePaul is well known, most people know about DePaul's size and its dominance in the market. They know that it's probably the best place in the city for evening and returning adult education. They generally know there's "a buzz" about DePaul that makes it an interesting place to attend. They even know that we are large—though they also are surprised to hear our claim to being the largest private in the Midwest and the largest Catholic university in the nation. But the true surprise—every time I tell them, is when I speak of DePaul's academic excellence. When I tell them how good our music and theatre schools are. They have no idea. When I tell them how impressive our CTI School is, our MBA ranking, or law school specialties, etc. I can still picture Barack Obama's face when I told him these things. He had no idea. Nor does most of Chicago.
And so, after nearly two years as your president, I report to you today that DePaul has pockets of true excellence—programs where the rest of the country will tell us and others that if students want to study that subject, they should go to DePaul. Beyond that, we are entirely respectable. We give students a solid education, and we have nothing to apologize for. But this is "pockets of excellence," not "across-the-board excellence."
The draft plan you see before you responds to the challenges we face, and also proposes ways in which DePaul can become stronger. For the past two years, DePaul has been successfully executing a strong defense. An effective defense. The truth is, you can "cut your way to stability," and we have. But you cannot "cut your way to greatness." This plan proposes that it's time for offense. We have to build something.
The plan that many of you have written rises or falls on one central idea: In a very competitive environment, the only safe strategy is to provide the highest quality at a good price.
A broad focus on the enrichment of academic quality— real and perceived— is the foremost and the most significant thrust of the strategic plan.
And so, the plan calls for:
- academic departments to improve, strengthen, update and teach more effectively their majors. We will ask them to create the best programs in the country so that students are well educated and well-prepared the day they graduate. No matter how good the program currently is, we will ask ourselves to raise it another notch.
- academic departments to raise standards, especially in writing skills. Not their entry standards, their daily standards. The level of work they accept from their students, and the amount of information they teach them.
- the internationalization of the curriculum. By this, the plan does not mean more overseas programs, but literally that students are prepared for a globalized workplace. Accounting students know global accounting standards. Law students can effectively serve businesses with global interests. All students understand global conflicts, international history, the intersections of religion, and more. When a DePaul student graduates, she or he should be ready for a world in which national borders are less meaningful every day.
- distance learning to distinguish itself by the quality of its education. We have no desire to become the WalMart of higher education. Indeed, I recently learned that the School for New Learning is regularly receiving transfers from the University of Phoenix because they students desire a higher quality education. The reputation of our distance learning program should and must build DePaul's academic reputation, not reduce it.
- DePaul to become a model of a diverse workplace and diverse intellectual community.
- faculty to deliver their courses using the city of Chicago as a laboratory. We believe that students learn better when they put that learning to work. Whether in service learning, internships, practical assignments, study abroad or more, the plan calls for the faculty extend classroom learning beyond the classroom.
- the university to make sure that students are not left behind when academic standards are raised. Our focus on retention (keeping them here) must change to a more proactive focus on fostering student progress.
I believe—and the DePaul community believes— that the university best protects itself from challenges, and best builds a strong future, if it focuses mightily on the enrichment of academic quality. In the end, it's the product that matters. The focus of this plan is on the product— the quality and reputation of our academic programs.
VISION twenty12 has a built-in tension, however. As we strive to raise our academic quality, we also intend to strengthen the institution's financial health. The plan calls for the university to work toward an endowment slightly greater that our operating budget, and slightly greater than our total debt. In short, we want the organization to have more powerful reserves working to support the institution, and are seeking to lessen our debt exposure. At any university, there is always a temptation to use present resources to achieve present dreams.
This plan you have before you today proposes a more conservative and long-range view that DePaul's mission long-term will be best protected and served if we lessen our debt and grow our endowment. This built-in tension—investment in academic quality while choosing to divert our available resources into the endowment and voluntarily minimizing any new debt—will make life hard for Helmut Epp and Scott Scarborough in the years ahead, but we believe that this dual-goal is the best one for DePaul long-term.
The plan you have before you is the work of the university community. You worked hard to create this plan. Staff added this into their already full-time responsibilities. Faculty participated over the summer and school breaks when many of them work full-time conducting their research. But you all accepted the task because you wanted to shape DePaul's future. The organization has built a consensus—perhaps not on every detail, but on the overall direction.
We could not have gotten there without the leadership of Gerry Mulderig, Helmut Epp, Scott Scarborough, Mary Finger, the faculty and staff of the Planning Committee, the countless faculty and staff serving on the various subcommittees and task forces. But in truth, we could not have gotten there at all without the leadership of Susanne Dumbleton. She, more than anyone, understood this organization, and knew how to create a process in which voices were heard, respected and incorporated. In her gracious, focused, organized way, she took an organization the size of DePaul and fostered consensus, credibility, and an energy to volunteer and build this vision. There were fits and starts, mistakes and successes, but she gave evenings, weekends, and vacations so that we can sit here today. Susanne, you will always have my respect and immense gratitude.
In truth, this plan is not an abrupt change of direction for DePaul. We are not leaving one business behind to start another.
- We are building a better DePaul.
- We're building an academically stronger DePaul.
- We're building a better academic reputation for DePaul.
- We're building a financially stronger DePaul.
- We're building a better internally functioning DePaul, that offers students outstanding service;
- We're institutionalizing and solidifying DePaul's Catholic and Vincentian character.
- We're taking the long-standing mission of DePaul—to make an extraordinary education accessible—and trying to live up to that mission promise.
If Vision 2006 was about building capacity, VISION twenty12 is about optimizing capacity.
If the Vision 2006 was about dominance, this plan is about is about prominence, but a prominence that keeps the door wide open for the students we love and cherish—those students who do not have the family resources for a truly outstanding education. Students of color. First-generation college-goers. Adults returning to earn their degree. We're not tightening the entry standards, we're strengthening the education they receive when they arrive. That's the kind of prominence, I believe, that befits a Vincentian institution of higher learning.
And so, the strategic plan focuses more on academic programs than on new facilities, but VISION twenty12 does note that the quality of the music, theatre and the science programs at DePaul are at risk if the university does not build new facilities in the years ahead. You've seen this in the plan. The new science building alone will cost $40 million. The Board of Trustees heard this need at its recent meeting, and suggested that the university could divert the budget for non-routine capital to this purpose for the next three years. That should raise 30 of the $40 million. So, we still need to raise $10 million to build this building, and we've already begun work on a campaign.
But I have an announcement today. This past Monday, as this campaign had barely started, a funder agreed to invest $9 million to help us build our new science building. We are still working out some of the details, but this will be the second-highest investment ever committed to DePaul University in its history. We're going to try to raise more, so that we can use the University's funds for other priorities. Still, we've got a plan now for 39 of the $40 million we need. We have a million to go, but it appears likely that we will be able to put a shovel in the ground next summer at this time. VISION twenty12 is off to a great start!
VISION twenty12 says this:
DePaul intends to become one of the finest urban, Catholic universities of the United States. Resolute in its Vincentian mission to make an extraordinary education accessible, DePaul will focus its energies on creating nationally recognized, rigorous program of study; preparing women and men to be at the forefront of their chosen fields as ethical and socially engaged leaders; and building the financial and operational foundations to make our cherished mission permanent and truly effective.
That's the vision. For the next six years, we are going to roll up their sleeves and build nationally recognized, rigorous programs of study. This plan begins and ends with academic quality and reputation. We will be successful if, six years from now, DePaul is a very different institution, and known as one of the finest urban, Catholic universities of the United States. No small task, but a worthy one.
God bless you.