strategic business framework - arizona state university business... · business planning framework...

Arizona State University

Strategic Business Framework February 2012 Update

ABOR 2/17/12

1

The Context for the ASU Strategic

Business Planning Framework

1. Constitutional Mandate

The universities are established to serve the citizens of Arizona

2. ABOR Vision 2020

ABOR establishes the goals to achieve the mandate

3. Enterprise Plan

The Presidents design innovative strategies to achieve the

goals

4. Strategic Business Framework for ASU

ASU utilizes specific strategies from the enterprise plan to achieve its targets

2

vision

To establish ASU as the model for

the New American University, measured

not by who we exclude, but rather by

who we include; pursuing research and discovery that benefits the public good; assuming major responsibility for the economic, social and cultural vitality and health and well-being of the community.

vision To establish ASU as the model for

the New American University, measured

not by who we exclude, but rather by

who we include; pursuing research and

discovery that benefits the public good;

assuming major responsibility for the

economic, social and cultural vitality and

health and well-being of the community.

3

national comprehensive

university by 2012 access and quality for all

establish national

standing in academic

quality and impact of

colleges and schools

in every field

enhance our local impact

and social embeddedness

ACCOMPLISHED

4

The New American University as Enterprise University

New American University Design Aspirations

=========================

Enable student success

Be socially embedded

Valuing entrepreneurship

Conduct use-inspired research

Fuse intellectual disciplines

Leverage our place

Transform society

Engage globally

Enterprise University Strategies

=========================

Secure resources to improve outcomes

Increase pipeline

Increase performance

Control costs

Maintain affordability

Increase research volume and value

6

Key Elements of ASU’s Strategic Business Planning Framework

Build the student pipeline

Maintain cost effectiveness

Secure the resources to build quality and

performance and to maintain affordability

Improve performance and achieve the metrics

7

ASU Strategic Business Framework Plan

Increasing Degree Production and Quality

• Key ABOR metric: 50% increase in degrees

• Requires :

– Expanded pipeline of new students

– Improved retention and graduation performance

– Curricula reform and improved student outcomes

– New platforms (ASU Online; Colleges)

8

Expanding Research Performance

• Key ABOR metric: $700 million in expenditures

• Requires:

– Growth in tenure and tenure track faculty and externally-

funded research faculty and staff

– Ongoing laboratory facility expansion

– Large scale inter-disciplinary research programs


9

Building the Resources Needed

• Expanded enrollment of non-residents and international

students

• ASU Online revenue

• Control of costs of education and financial aid

• Tuition rate growth to peer averages

• Performance funding

• Brand enhancement


10

The Enterprise University

Improving Cost Effectiveness

Control costs through innovation and use of

technology in academic and administrative operations

Use private sector services where efficient and effective

Enhance student success and outcomes

Build brand awareness and quality

Self-management of health and retirement programs

11

Building the Resource Base

Encourage new state funding based on performance

Develop enterprise revenue sources:

Non-resident enrollment

International enrollment

ASU Online

Technology transfer

Private sector partnerships & personal investments

Externally-funded research

Leverage existing and new partnerships

The Enterprise University

12

Steps to Build the Student Pipeline

Resident freshmen

• Limited growth without improved high school performance

• Encourage all qualified students to enroll

Arizona community college transfers

• MAPP and TAG programs

• Improved communication

Non-resident freshmen and transfers

• Aggressive recruiting expansion

• Focus on California

• Focus on international students

• Brand value enhancement

• Financial aid policies

• ASU online

Increasing Degree Production And Quality

13

Enhancing Performance

• Retention improvements

• ASU Online recruitment and marketing

• Change clock speed (all levels and functions)

• Flexible academic terms

• Learning outcome-based courses

Building the Resources Needed

• Moderation of tuition increases

• Financial aid controls

• ASU Online partnership investments

• Performance funding

Increasing Degree Production And Quality

14

Building the Pipeline: New In-Person UG Enrollment Sources

6,667 6,143 6,827 7,322 7,583

6,031 5,893

6,563 7,229

7,641

12,698 12,036

13,390

14,551 15,224

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

ASU Strategic Business Framework New Resident Enrollment

Total

NewResidentTransfers

NewResidentFreshmen

2,968 3,354

4,081 4,678

5,062

1,335

1,705

2,062

2,325

2,460

4,303

5,059

6,142

7,003

7,522

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

ASU Strategic Business Framework New Non-Resident Enrollment

Total

New Non-residentTransfers

New Non-residentFreshmen

16

Sources of Total In-Person UG Enrollees

23,784 24,406 25,116 27,801 29,709

15,256 15,593 16,768

18,924 20,222

9,799 10,327

11,979

14,430

16,312

3,244 3,802

4,729

5,656

6,189

53,383 55,090

59,856

68,081

73,692

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

Fall/Spring 2009 Fall/Spring 2011 Fall/Spring 2014 Fall/Spring 2017 Fall/Spring 2020

Total

Other

Enrolled students whoentered as non-residenttransfers

Enrolled students whoentered as non-residentfreshmen

Enrolled students whoentered as residenttransfers

Enrolled students whoentered as residentfreshmen

17

Sources of In-Person Undergraduate Enrollees

45.7% 45.1% 42.9% 41.6% 41.0%

29.3% 28.8% 28.6% 28.3% 27.9%

18.8% 19.1% 20.4% 21.6% 22.5%

6.2% 7.0% 8.1% 8.5% 8.5%

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

120.0%

Fall/Spring 2009 Fall/Spring 2011 Fall/Spring 2014 Fall/Spring 2017 Fall/Spring 2020

ASU Strategic Business Framework Sources of UG Enrollees

Enrolled students who entered as non-residenttransfers

Enrolled students who entered as non-residentfreshmen

Enrolled students who entered as residenttransfers

Enrolled students who entered as residentfreshmen

18

Building the Pipeline: ASU Online

Strategies

• Establishing ASU Online as the first national comprehensive public university offering– must be moving quickly

• Private sector partnerships provide capital for rapid ramping up of scale

• Building ASU as a national brand in higher education – on-campus and in online

• Assuring high quality in broad program offerings from the faculties of the ASU schools and colleges

0

5,000

10,000

15,000

20,000

25,000

ASU Online Projected Enrollment and Degrees

Awarded

Total ASU Online enrollment Total ASU Online degrees

FY12 enrollment is over 5,000 students

Degrees production goal approaches 4,000 by 2020

19

Maintaining & Improving Cost Effectiveness

Strategies

Consolidation of administrative operations in academic units

Learning studio methods for teaching mathematics and writing

Private sector partnerships in appropriate areas

Innovative class staffing

Reduce unneeded in-state financial aid competition

20


Results & Goals

ASU performance as compared to other research universities is already

superior

Net E&G investment per degree in FY12 will be 10-15% lower than it was

in FY08

Improve outcomes at a faster rate than revenues.

Continue to drive E&G revenue per degree (CPI-adjusted basis) lower

than current levels

21

Current Cost Effectiveness

$-

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

$140,000

FY2010 IPEDS Tuition, Fee, and State Revenue per Degree

Very High Research Universities with >$750M in E&G Revenue

22

Current Cost Effectiveness

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

$14,000

$14,500

$15,000

$15,500

$16,000

$16,500

$17,000

$17,500

$18,000

$18,500

Deg

rees

Aw

ard

ed

Tuit

ion

, Fee

an

d S

tate

Rev

enu

e p

er F

TE

FY2010 IPEDS Tuition, Fee, and State Revenue per FTE & Degrees Awarded

Very High Research Universities with $15,000 to $18,000 In Revenue per FTE

23


60,000

65,000

70,000

75,000

80,000

85,000

90,000

FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20

Gross E&G Investment per Degree Awarded

Total E&G revenue per degree CPI adjusted

50,000

55,000

60,000

65,000

70,000

75,000

80,000

FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20

Net E&G Investment (less Financial Aid) per Degree Awarded

Total Gross E&G less financial aid per Degree CPI adjusted

24

Securing Resources

Strategies

Increase revenue derived from non-resident

and international enrollment

Build ASU Online

Cost control

Performance funding

Partnerships

Limited tuition rate increases

25

Results & Goals

Non-resident and international students grow from about 25% of

in person undergraduates to over 30%

ASU Online expands rapidly to over 20,000 students in 2020

Work to maintain moderate tuition rate increases (assuming low

inflation and reasonable state investment)

Performance funding has been proposed in the Governor’s budget

Securing Resources

26

Tuition Revenue Sources

27

39.1% 47.0%

43.1% 41.2%

43.9% 34.8%

34.8% 36.0%

17.1% 15.2%

13.7% 13.3%

0.0% 3.1% 7.7% 8.9%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

FY08: $415M FY12: $732M FY16: $1,050M FY20: $1,452M

Colleges tuition

ASUOnline (net)

Graduate tuition

Non-Resident UGtuition

Resident UGtuition

State budget reductions and the resulting tuition increase

Growth in non-residents, international, and ASU Online allow more moderate resident tuition increase

E&G Revenue Sources

28

41.4%

60.5% 61.5% 64.9%

0.0%

1.9% 5.2%

6.4% 49.0%

25.6% 23.0%

20.8%

0.0%

9.6% 12.0% 9.9% 7.5%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

FY08: $1,002M FY12: $1,173M FY16: $1,567M FY20: $2,023M

Total other

Stimulus

General Fund

ASU Online (net)

Colleges tuition

Total In-Persontuition

Tuition had to replace state funds in the FY08 to FY12 period. Online will slow the growth of that trend, and non-resident tuition will become a larger proportion of tuition.

Gross Revenue Sources

29

10.9%

19.6% 19.0% 19.4%

12.2%

14.5% 15.4% 17.0% 4.7%

6.3% 6.1% 6.3%

1.6%

2.9% 2.3% 2.0% 2.5%

7.2% 9.1%

32.9%

17.1% 15.2%

13.6% 1.9% 1.4%

1.2% 1.0% 8.5%

5.1% 4.2%

2.9%

8.9%

8.1% 6.8% 5.9%

18.4% 22.5% 22.7% 22.8%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

FY08: $1.50B FY12: $1.75B FY16: $2.40B FY20: $3.10B

Research*

Auxiliary*

Other*

TRIF*

State appropriations

Online tuition

Fees and summer session

Graduate tuition

Non-Resident UG tuition

Resident UG tuition

Maintaining Affordability

Strategies

Maintain the commitment to financial aid – the key strategy since

2002

Low rate of tuition increase

Innovative curricula structures to reduce time to degree

Transfer guarantee programs to reduce time to degree

Higher graduation rates = fewer students paying tuition without a

pay-off

30

Maintaining Affordability

Results & Goals

Increased enrollment of UG minority students by over 25% since

2008 and 90% since 2002

Increased enrollment of Pell Grant recipients by almost 150%

since 2002

Over 6,500 students enrolled in MAPP and TAG transfer programs

at community colleges

Lower tuition rates now available at West and Polytechnic lower

divisions and at Lake Havasu City in Fall 2012

31

942 1,038 1,071 1,271 1,225 1,137 1,215 1,211 1,141

2,074 2,270 2,330 2,516 2,676 2,749 3,013 3,295 3,263

1,461 1,661 1,735

1,893 2,082 2,105 2,465

2,767 2,942

5,056

5,723 5,991

6,464 6,999 7,311

8,109

8,734 10,075

76

713

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

2002 2003 2004 2005 2006 2007 2008 2009 2010*

Two or More Races

Native Hawaiian/PacificIslander

Hispanic/Latino

Black/African American

Asian

American Indian/AlaskanNative

All Undergraduate Minority

Fall Total Degree Seeking Enrollment

32

All Graduate Minority

Fall Total Degree Seeking Enrollment

224 238 166 182 202 233 238 273 231

461 487 426 428 416

510 620 640 680

307 344

310 318 309

384

449 490 510

962 926

825 861 860

1,012

1,225 1,190

1,277

19 133

0

500

1,000

1,500

2,000

2,500

3,000

2002 2003 2004 2005 2006 2007 2008 2009 2010*

Two or More Races

Native Hawaiian/PacificIslander

Hispanic/Latino

Black/African American

Asian

American Indian/AlaskanNative

33

ASU Pell Grant Recipients: Nine-year Trend

9,238 10,344

11,957 12,348 12,137 11,714 11,597

13,334

18,454

22,487

0

5,000

10,000

15,000

20,000

25,000

Head

co

un

t

Aid Year

143% increase over

nine years

34

Undergraduate Tuition & Fee Planning

35

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

120.0%

FY04 to FY08Actual

FY08 to FY12Actual

FY12 to FY16Range

FY16 to FY20Range

Resident UG Tuition and Fee Rate Increases

Higher range Projected Actual

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

FY04 to FY08Actual

FY08 to FY12Actual

FY12 to FY16Range

FY16 to FY20Range

Non-Resident Tuition and Fee Rate Increases

Higher range Projected Actual

Tuition increases in FY04-FY08 built program quality. Increases in FY08-FY12 partially compensated for state appropriation reductions. Future tuition increases can be moderate provided inflation is limited and state investment is maintained and supplemented by consistently supported performance funding.

Progress Towards Achieving the Vision 2020 Metrics

36

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

Research expenditures$700 million

In-Person enrollment85,000

ASU Online enrollment20,000

Total degrees25,000

6-yeargraduation

75%

Freshmen retention90%

FY08

FY12

FY16

FY20

Goal

Retention and graduation indicate rates of progress to the goals. They do not indicate actual rates of retention or graduation.

Increasing Degrees Awarded

Strategies

Build the student pipeline

eAdvisor and other technology tools

Assuring the availability of classes needed (part of eAdvisor)

Financial incentives for unit for improving retention and graduation

Innovations permitting faster time to degree

ASU Online

Efficiency of transfer via the MAPP and TAG programs

37

Increasing Degrees Awarded

Resources Needed

Continued investment in faculty

Financial aid to assure that costs are not a barrier to enrollment

and retention

Ongoing innovation in technology to support retention

Ongoing innovation in teaching

Space renovations to support teaching innovations

38

Continual Improvement First-time Full-time Freshman Retention Rates

77.2%

79.5% 81%

84%

2006 2007 2008 2009

Retention Rates

6.8% Increase in

retention rates

Entering Cohort on 21st Day

39

Degree Projections

40

0

5,000

10,000

15,000

20,000

25,000

30,000

Degrees Awarded

ASU OnlineGraduatedegrees

Graduate in-Persondegrees

ASU OnlineUG degrees

In-Person UGdegrees

14% increase in UG degrees since FY08 31% increase in Graduate degrees since FY08

Silver Gold Target Target

Increasing Research Expenditures

Strategies

Faculty hiring in strategic areas

Organize departments to encourage large scale inter-disciplinary

research programs

State-funded research facilities program approved in 2004

provided support for three ISTB buildings, Biodesign, and ABC 1

Aggressive proposal generation and funding targets for schools

Partnerships with foundations and private companies

41

Increasing Research Expenditures

Resources Needed

Healthy research support in the federal budget and at foundations

and corporations

Globalization of research support

Continued investment in in tenure and tenure track

faculty and externally-funded research faculty and staff

Ongoing laboratory facility expansion

Appropriate federal indirect cost recovery

42

44

-

50,000,000

100,000,000

150,000,000

200,000,000

250,000,000

300,000,000

350,000,000

FY2001 FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011

Research Expenditure Growth

SERD researchexpenditures

HERD researchexpenditures

Research Expenditures

$0

$100

$200

$300

$400

$500

$600

$700

$8001

97

21

97

31

97

41

97

51

97

61

97

71

97

81

97

91

98

01

98

11

98

21

98

31

98

41

98

51

98

61

98

71

98

81

98

91

99

01

99

11

99

21

99

31

99

41

99

51

99

61

99

71

99

81

99

92

00

02

00

12

00

22

00

32

00

42

00

52

00

62

00

72

00

82

00

92

01

02

01

12

01

22

01

32

01

42

01

52

01

62

01

72

01

82

01

92

02

0

NSF adopted a new reporting standard in 2010. 2003-2009 have been restated under new standard for comparison.

Total Research Expenditures

Mill

ion

s

Aggressive Forecasts

Conservative Forecasts

45

Legislative and Governance Needs

State of Arizona

Performance funding program with consistent funding

appropriation

Ability to withdraw from required participation in the Arizona State

Retirement System

Ability to withdraw from the Arizona state health insurance model

Freedom from mandates and policies that hamper effective

operations and development of an attractive national brand.

46

Legislative and Governance Needs Arizona Board of Regents

Tuition rates that are responsive to HEPI/CPI and State

investment changes (+/-)

Permanent policy allowing 40% non-resident undergraduate enrollment

Flexibility and speed in expanding facilities to meet metric-driven needs

Flexibility and speed in entering partnerships to build resources and efficiencies

Acceptance of the differentiation model between the three universities in establishing policy

Flexible business model for ASU Online.

47

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