Continuing and professional education units are the innovation engines of higher education: identifying emerging markets and audiences, enabling wider access and outreach, addressing increasingly complex delivery channels and platforms, and embracing “risky” programs and partnerships that are more sensitive to current market demand than traditional academic content. How is yours performing?
As we begin our next round of continuing and professional education benchmarking, we wanted to share three of our findings from our pilot study:
CE unit autonomy does not correlate with giveback to central institution overhead.
CE units often develop their own “in-house” versions of business services such as admissions and marketing to better serve non-traditional learners. Therefore, they rely less on centralized services at the institution. But these self-support CE units are generally required to pay a percentage of gross revenue to cover central overhead costs. We reviewed whether institutional policy on CE unit contribution to central overhead correlates somehow with the level of “autonomy” of the CE unit from the parent institution. We assigned an autonomy score to each CE unit based on how many services and functions they each manage (“1” = fewer in-house services; “10” = many in-house services). The autonomy score is the x-axis, and the percentage of the CE unit gross revenue required to cover central overhead costs is the y-axis.
There is very little correlation between how many in-house services a CE unit provides and how much revenue is required to be returned for central overhead costs. This suggests a lack of rationale in institutional policy toward CE units.
Revenue and even net revenue metrics can obscure CE unit manager performance. Reviewing spend efficiency can better normalize performance across varying tuition price points.
Revenue metrics are widely used to generalize “performance” across many different organizations. But in the case of for-credit offerings in higher education, price – or tuition policy – is not always subject to CE unit manager influence or control.
To account for differences in tuition, we plotted on the y-axis “spend per enrollment” – that is, how much money it takes to capture a single enrollment – against “revenue per enrollment,” or price, on the x-axis. We find correlation between higher prices (revenue per enrollment) and higher spending per enrollment.
You can see in our graph that more efficient institutions have plot points below the trend line, and less efficient institutions have plot points above the trend line. For example, the plot point circled in red offers courses at the $1,800 price point but spends nearly the same amount to acquire that enrollment. The plot point circled in purple offers courses at the $1,700 price point but spends less than $1,000 to acquire it.
CE unit managers should review their own “cost of doing business” and be able to articulate and clarify to senior leaders which aspects of spending are due to institutional mandate (required expenses or expenses that support mission) versus managerial decisions.
More marketing expense does not reliably lead to higher enrollments.
Marketing spending and channel selection are of significant concern to CE unit managers, many of whom are responsible for marketing planning for their units. In our sample, larger CE units spend significantly more on marketing expenses than smaller CE units. The following chart plots enrollments against the amount spent on marketing.
We find no discernible trend supporting the idea that more marketing expense leads to higher enrollments. For example, CE units with greater than 20,000 enrollments spent at both the lowest and highest ends of the spectrum.
How are you doing?
We invite all CE units across the country to participate in our next round of benchmarking. Participation is free and open to all types of CE units. Please contact us today for more information on how to participate at email@example.com.
Download the Insight In Brief for our Critical Insights for Leaders: Inaugural Continuing & Professional Education Benchmarking Study.