Remarkable Times, Remarkable Blessings

Remarkable Times, Remarkable Blessings

by Zach Clark, Westminster Christian Academy, St. Louis

There is always a non-voodoo explanation.
From the TV series, Monk

In January of 2009, news began to spread that our nation and world truly was suffering the “worst economic crisis since the Great Depression”. The first week of January I was on the phone with Barrett Mosbacker, and I said to him, “I believe 2009 is going to be a remarkable year!” Barrett asked, “Remarkable in what way?” And I replied, “That’s what I like about that word…remarkable…I’m going to be right whether things get worse than anyone imagines or better than anyone dares hope for.”

2009 has been truly remarkable, and it’s not over yet. At the Christian school (grades 7-12) where I serve we faced the threats of major shifts in our region and world. From what I hear, it is possible that every Christian school in America faced some unique challenges this year, and many are struggling. At Westminster Christian Academy, we have been greatly encouraged by how God is leading us through these challenges. We are trying to determine what we are doing right (so we can keep doing it) and what we need to change or improve in the future (so we can stay strong).

I’m hopeful that some of my personal thoughts on the threats, strategies, blessings, and challenges that we have faced might be helpful to you.

We began the 2008-09 year having experienced the following in previous years:

1. Ongoing enrollment growth.
2. Ongoing income growth and record levels of giving.
3. Constant programmatic improvements and reputation for increasing quality.
4. The beginning of a capital campaign calling for transformational facility expansion, an entirely new campus.
5. A projection for another year of enrollment growth in 2009-10.

Only six months later, by February, we realized reality had changed:

1. A tuition increase was in place, although lower than in most recent years at 5%, it was still noticeable and felt by parents.
2. Shifts in our inquiries for admissions data suggested that enrollment would most likely hold steady, and more re-enrolling families than ever before would be requesting financial aid for the first time.
3. Unrestricted giving providing important dollars for the budget was the lowest in seven years. We projected our budget giving would be as much as 20% off of our budget.
4. Resistance to making any long-term campaign commitments was overwhelming.
5. A region-wide culture of fear and strong reactions was in place as we received constant advice on planning for such things as a possible 30% decrease in enrollment and 40-50% decreases in giving.

Another six months later, in August 2009, we started this school year with some amazing news of God’s provision through these difficult times.

1. Record enrollment, surpassing even our pre-economic crisis projections.
2. Record giving, and only a 10% drop in budget giving.
3. No significant cuts to people or programs that impact students and families.

Above I’ve provided a very general and high-level view of some of the key economic health indicators of a Christian school, and how dramatically they shifted. Perhaps your circumstances were more challenging or less so.

What I want to focus on in this piece is how we responded and the steps that we took because I believe they are instructive and helpful. Even though some may say the “crisis is behind us,” the basic steps we’ve taken and how we continue to move forward are based on core values and principles of effectiveness that should be helpful and transformative at any time. Our school leadership continues to discuss these, analyze these, and seeks to understand what is happening.

The aforementioned shifts literally seemed to occur overnight and our heads were spinning. There is no reason to pretend that we all “knew what to do.” Every person I talked to at the beginning of 2009 seem dumbfounded and awed by the changes that were occurring. I kept hearing people say, “I’ve never seen anything like it.” But, we took a deep breath, we prayed, we asked a lot of people for advice, and we tried to be steady and strong as we outlined how we intended to move forward during these strange times.

Firstly, we recognized that this is an overwhelming difficult time for so many people. Husbands and wives are facing fears and tests of faith they have never experienced before. Fathers and mothers are enduring major adjustments to their careers and lifestyles. Children are dealing with questions and uncertainty unique to this moment in history.

Secondly, we began by asking the question found in Ezekiel 33: “How should we then live?” We are finding strength in a renewed sense of our dependence upon God as we remember His faithfulness.

Thirdly, we made a conscious decision not to go into what we called a “hunker-down” mode. We wanted to be willing to make tough decisions but be proactive and not simply reactive.

Fourthly, we committed to communicate in an encouraging but straightforward manner.

Lastly, and maybe most importantly, we asked the Lord to help us discover ways to make decisions with the right priorities in mind. We believed this is a time where we could make significant statements about who we really are as a school community. We prayed that we could seize opportunities to live out the truth that God, in His unchanging love through Jesus Christ, is the faithful, merciful, and compassionate Provider and Savior of the world.

One of the things I personally learned is that all of the above is really easy to talk about. It’s taking the time to establish priorities and then make tough decisions to back it up that is the truly hard and sometimes painful part.

So, we recognized reality, asked questions, prayed, resisted the urge to hit the panic button, prepared to communicate, and established priorities to guide our decision making...and I mean all of this in the most literal sense possible.

Here are the priorities we established, put in writing, and communicated.

Priority #1: Today and Every Day

Today and every day, we will hold to our mission and vision to see young men and women equipped to engage the world and change it for Jesus Christ. Our core values will never change. We will keep the main thing, the main thing: the Christian education of the individual student. We continue to strive to hire and keep the best teachers, coaches, and staff members. We constantly improve, offering better value to students and families through the years, always working to become better than we once were.

Priority #2: Stronger Tomorrow

We are making the tough decisions that help us stay financially strong over the long haul. We are holding fast to the families we serve, enrolling new students, and we will serve families in good times and bad. We are pushing forward on difficult decisions that pave the way for our future sustainability, ensuring a strong Westminster in the future. We will also introduce new technologies and programs that best equip our students for their future, not our past. We will not compromise the quality of today for tomorrow’s dreams, but neither will we make decisions that are so shortsighted that they compromise the financial stability of our future.

Priority #3: Moving Ever Forward

We will continue to implement our strategic plan and communicate our vision for the future, providing opportunities for people to make a difference and make decisions that move us ever forward as a Christian school. Planning will continue to be a dynamic part of our culture. We pray that God will move the hearts of people to give in order to keep Westminster strong and improving, and we will continue to wait upon the Lord for the sale of our current campus and provision of our future dreams.

It is usually easy to establish priorities, the challenging part is making decisions on a daily basis that honor your priorities.

Then, we took it a step further. We articulated, in very specific terms, the types of disciplined actions we would be taking to reflect those priorities. I’ve underlined here the key principles.

• Implement conservative spending and aggressive fund-raising, making some tough decisions along the way in our annual budgets.
• Support creativity and innovation among teachers.
• Continue to go the extra mile for students who struggle socially or academically.
• Promote even more personal involvement of teachers and coaches in the lives of students and families, as many will face unusual challenges.
• Respond to the unique economic problems that may be faced by our parents and teachers to the very best of our ability.
• Improve our processes and communications with parents, utilizing non-paper methods to improve speed and lower costs.
• Leap forward in technology integration at the classroom level and 21^st Century learning for students.

And then, we started moving forward on all these actions in very tangible ways. I won’t go into every action, but here are some:

• We communicated like crazy, even asking families to respond to a “Share Your Heart” survey so they could tell us privately how the economy was really affecting them and give us advice.
• We put our campaign on a short-term hold, because Priority 2 said, “we will not compromise the quality of today for tomorrow’s dreams.”
• We froze faculty/staff salaries.
• We increased our total financial aid budget to respond to many re-enrolling families experiencing dramatic economic difficulty.
• We asked teachers and staff to give us their ideas on how to save money without reducing quality.
• We looked for key ways to add value to families without adding cost.
• We made significant shifts in our costs of paper and printing.
• Every administrator became personally responsible for helping teachers, staff, and even volunteers focus on student retention and new family enrollment.
• We increased our focus and energies on improving the school through changes, innovations, improvements, and efficiencies. And, we continued to focus on the implementation our Strategic Plan.
• We made our most significant and visible investment in technology for teachers ever, with every teacher receiving a new Macbook.

Ultimately, it is God’s mercies and provision, by His grace, that sustains us. But, I also know that God works through people, their decisions, and their strengths and weaknesses. Many schools are facing far more difficult times than we have. We do not pretend to fully understand all of what has happened or what is happening now. But, I do challenge you to join us in the day-to-day discipline of asking questions and digging deeper down and climbing higher up in the understanding of this calling of serving in a Christian school in today’s times.

2009 is indeed a remarkable year, and remarkable times remain ahead. Let us go forward together.

They Are Coming After Your Students and Said So!

Dr. Barrett Mosbacker, PublisherAt a recent Executive Symposium on Distance Education that I attended a public school superintendent, not knowing I was from a private school, said to the group (to paraphrase), "we are developing a robust online program and we fully expect to recapture students from home schooling families and private schools."

I just reread portions of Christensen's excellent book, "Disrupting Class".  I am particularly interested by his analysis of the "Dimensions of Agreement" and the "Tools of Cooperation".  I have attached graphics depicting the concepts.  These are particularly important to me because it can be difficult to get staff to accept change--I find this particularly problematic among conservative Christians, whom by definition, are "conservative."  :-)  In my estimation, moving forward, carefully and thoughtfully, with distance learning programs in imperative but it is not an easy task--the learning curve is steep, creating a feasible business plan is critical, and getting buy in can be tough.  But, Christensen argues, refreshingly, that consensus is not necessarily the goal--cooperation is!  I find that a refreshing approach given the emphasis on consensus building over the last several decades in the management literature.  I was also surprised by his observation that change is most difficult when there is wide agreement on the goals and processes currently in place.  Generally, one would think that this is a good thing. Upon reflection, however, it is easy to see why change in an organization can be very difficult when the organization is in the upper right quadrant of the dimensions of agreement chart.  This means that one of our challenges is to challenge the consensus on the goals and/or processes currently in place, which is all the more difficult when the organization is successful.  In other words, success can actually work against us, as in "good is the enemy of great."  It is what I'm calling the "Hobbit Effect."

In the Lord of the Rings, the Hobbits went merrily about their lives oblivious to the fact that Mordor was rising and threatening them.  Only a few saw the danger and acted.  I wonder if distance learning and charter schools aren't the "Mordors" of Christian education.  While we argue about uniforms, dress codes, and tuition discounts, the public system is installing a robust distance learning infrastructure and charters are multiplying.  Will we wake up in 10 years and wonder what happened to our market?’

Christensen (2008), Disrupting the classroom, p. 187

 

I am so impressed with Christensen's book that I've ordered two more:
The Innovator's Dilemma: The Revolutionary Book that Will Change the Way You Do

The Innovator's Solution: Creating and Sustaining Successful Growth

The Charters are Coming!

How to Position Our Schools for Long-Term Success Despite Prolonged High Unemployment and New Competition

Dr. Barrett Mosbacker, PublisherOver the last year or so  200 Christian schools have closed their doors.  Many who have not closed have lost students and laid off staff.  More will close this year.  Although a few Christian schools are thriving, most are not.

This may not be a short term problem.   There are at least three long-term challenges facing the Christian school movement:

1) Prolonged high unemployment

2) Federal funding for more charter schools and distance learning programs

3) New research that seems to show that distance learning can be as or more effective than traditional instruction

Prolonged High Unemployment

In a recent Wall Street Journal article (August 25, 2009), Deborah Solomon warns:

The administration, in its mid-year budget review, painted a picture of a nation that … is in for a prolonged period of economic weakness, joblessness and unsustainable government spending …

The administration now foresees unemployment hitting 10% at some point over the next year and a half, with the jobless rate averaging 9.3% in 2009 and 9.8% in 2010 … "We do predict unemployment will reach 10% for some months and some quarters," …

In a measure of the dire state the nation's fiscal picture, the level of U.S. public debt when measured as a percentage of economic output is projected to reach its highest levels since World War II. The administration is projecting that public debt will hit 66.3% of gross domestic product in 2010, more than any other time since the 1940s, when it peaked at more than 121% of GDP.

Funding for Charter Schools and Distance Learning

In an article published by eSchool News, the authors report that:

… stimulus could spur more virtual charter schools 'Race to the Top' program favors states that encourage charter schools -- including those that offer online instruction …

As states compete for more than $4 billion in federal "Race to the Top" stimulus grants, Education Secretary Arne Duncan has made it clear that states willing to embrace charter schools and other favored innovations will get preference. That, in turn, could prompt a rise in the number of virtual charter schools and other charters that open across the country …

Duncan recently wrote in an opinion piece, declaring that states with limitations on charter school will decrease their odds of getting Race to the Top grants …

At the National Alliance for Public Charter Schools Conference this summer, Duncan called the charter movement "one of the most profound changes in American education--bringing new options to underserved communities and introducing competition and innovation into the education system." …

Todd Ziebarth, vice president of policy for the National Alliance for Public Charter Schools, thinks Duncan will want to reward states that are strong in all the elements, forcing states like Washington back to the table on charters …

Virtual charter schools are growing in popularity across the country … Indiana is opening its first statewide online charter school this year, and five organizations have filed petitions with Georgia's Charter School Commission to open virtual charter schools in the state, hoping to capitalize on the popularity of the state's sole online charter school, the Georgia Virtual Academy …The academy has nearly 4,500 students enrolled in just two years of operation and a growing waiting list …

Duncan has been putting states on notice for months that he wants them to embrace charter schools, and that their failure to do so could mean they lose out on federal money …

Tennessee lawmakers passed a bill expanding charter schools in the state after hearing Tennessee could lose out on the money if they kept blocking an expansion of charter schools.

Illinois lawmakers decided in July to allow 60 more charter schools to answer President Obama's challenge after a campaign in that state by the state network of charter schools.

Research Appears to Support Effectiveness of Distance Learning Programs, Adding Credibility

An article in the New York Times reports that a recent 93-page report on online education, conducted by SRI International for the Department of Education, has a starchy academic title, but a most intriguing conclusion:

“On average, students in online learning conditions performed better than those receiving face-to-face instruction.” …

The analysis for the Department of Education found that, on average, students doing some or all of the course online would rank in the 59th percentile in tested performance, compared with the average classroom student scoring in the 50th percentile. That is a modest but statistically meaningful difference.

“The study’s major significance lies in demonstrating that online learning today is not just better than nothing — it actually tends to be better than conventional instruction,” said Barbara Means, the study’s lead author and an educational psychologist at SRI International.

This hardly means that we’ll be saying good-bye to classrooms. But the report does suggest that online education could be set to expand sharply over the next few years, as evidence mounts of its value.

What does this mean for our schools? 

It means that our schools are likely to be squeezed from two sides—an anemic economy with high unemployment (and potentially high inflation) and more vigorous competition from charter schools and distance learning options.

So what do we do?

I make no pretense of having all of the answers but I would like to suggest the following ideas.

Don’t Panic

Every challenge has a reciprocal opportunity.  Although poorly managed and relatively weak Christian schools may not survive, those with strong, creative, and decisive leadership will not only survive but thrive—provided they adapt to the changing educational landscape. 

Focus on Excellence and Value

Although this may seem to be counter-intuitive, being “affordable” is not the solution—being excellent and providing a high marginal value for parents is.  We must be able to answer two questions for the vast majority of our parents who, unfortunately, do not grasp or fully appreciate the value of a biblical worldview:

“Why should I spend $x for a Christian education when the charter school is free and offers an education characterized by high academic standards and traditional Judeo-Christian “values”?

Or,

“Why should I spend $x for a Christian education when I could home school my child and supplement his/her instruction with distance learning?

Those are fair questions and they must be answered in concrete terms.  Simply answering by recounting the benefits of teaching a biblical worldview will not be an adequate answer for many parents. 

Do not misunderstand—teaching our students to have the mind of Christ IS the central mission of our Christian schools.  But that mission is always within the academic context.  Christian education is an academic enterprise with an unapologetic and energetic focus on providing students a Christ honoring world-class and globally aware education.

Whether we like it or not, most of our parents don’t understand the mission of developing a biblical worldview.  And if they don’t understand or appreciate it they will not make significant sacrifices for it, everything else being relatively equal.

In other words, for most of our parents, the development of a biblical worldview is an ethereal concept subservient to more “practical” considerations like education quality, admission to top colleges, the breadth and depth of extra-curricular programs, a safe and nurturing environment, etc.

Why don’t they understand and appreciate the goal of developing a biblical worldview? I believe there are at least three reasons:

1) Because they have never experienced its life changing impact.  Most of our parents were educated in public schools and public universities.  They don’t get it—at least at first.  They have no experiential context to draw upon.

2) Most of our pulpits do not explicitly endorse the value of a Christian education as an intellectual enterprise.  Christian education is not promoted as a theological or kingdom imperative.

3) The prevalence of theological ignorance and pietism.  As a rule, pietism minimizes the life of the mind while emphasizing the emotional/experiential component of the Christian life.

We must place emphasis on ensuring that we are delivering an excellent educational product and understand that doing so is intrinsic to providing a Christian education that honors Christ and prepares his disciples to serve him in this world.  We are NOT providing excellence in education AND a Christian education.  Christian education by definition must be excellent education. 

The good news is that many parents will learn to understand and appreciate the development of a Christian worldview once they experience it through the lives of their children.  Those who enroll for other reasons, e.g., academic quality, grow in their understanding and commitment to a Christian philosophy of education—but most do not start with that understanding or commitment. 

Excellence is in and of itself a holy goal when done for God’s glory.  It is also a practical means to encourage parents to enroll their children in our schools and to sacrifice to keep them enrolled.  Over time, these parents become strong advocates of Christian education for ALL of the right reasons.

Excellence Starts with an Excellent Faculty

I am not going to beat around the bush.  We must do whatever it takes, provided it is biblical, to ensure that every classroom is staffed with a highly competent Christian teacher.  We must dismiss, ethically and graciously, those who are unable or unwilling to learn and grow and who are merely adequate.  We must stop the educational malpractice of having students educated by mediocre teachers using “grace” as a pretext for an unwillingness to make hard decisions.  We do not have the right nor the liberty to make our students bear the educational cost of sitting under the instruction of ineffective or mediocre teachers.  Period.

I am absolutely convinced that the most important thing we can do to honor our Lord, serve our families, and strengthen our schools is to hire, train, and retain only excellent Christian teachers.  The same general principle holds true for every employee we hire or keep but quality instruction in each classroom must be our first priority.

Parents will make great sacrifices to have their children in a school where they know that their children will receive dynamic, creative, loving, and effective instruction year after year from mature Christian teachers.  They will—and I think rightly so—look for other educational options if this is not their experience.

For more information on hiring and training teachers, see my previous article “Rethinking Staff Development: “This Too Shall Pass.”

Distance Learning

Our schools need to consider how to leverage new technologies, particularly distance learning, to enhance and expand their curriculum and market.  For more information on this topic see my previous article “Can We Keep Up with the Competition?”

Think Ahead—Anticipate

It sounds like a cliché but we need to be less reactive and more proactive as leaders.  We need to look over the horizon in order to position our schools to take advantage of new opportunities and to meet new challenges. 

Case in point.  As I read the Wall Street Journal and witnessed the unraveling of the economy one of my first thoughts was, “How will this affect our parents and school?”  I quickly came to the conclusion that the rising unemployment rate would translate into lower retention rates, fewer new applications, and the increased aging of our accounts receivables.  With those thoughts in mind we quickly made the following decisions prior to the creation of the budget and prior to reenrollment deadlines:

1. We increased the total funds available for financial aid.
2. We froze all salaries.
3. We postponed a major capital campaign.
4. We intentionally “over-enrolled” our classes where possible—exceeding our stated enrollment caps.  We did so anticipating future attrition, which would bring the numbers back down to normal levels while simultaneously ensuring full enrollments.  Sure enough, that is precisely what happened.  In fact, in God’s providence, we have a record enrollment this year.
5. We continued to expand and develop our programs.  Cutting back on quality is NOT the right response.  We added a digital photography elective this year and an environmental studies course last year.  We are moving aggressively ahead with the development of our distance learning program and we are inviting world-class scholars and leaders to the campus.  We are also expanding our dual-enrollment program.
6. We continue to place top priority on the qualify of instruction in our classrooms as reflected in multi-year intensive training programs, teacher mentoring, and thorough evaluations.
7. We continue to invest in mapping the entire curriculum.
8. New technology is being added on both campuses including additional SMART boards for the elementary campus and server technologies that will enable us to move much closer to a “paperless” environment.
9. We are beginning to review the potential of digital textbooks as an effective and less costly option to standard printed textbooks.
10. We are expanding our efforts in Alumni development.
11. And  more…..

I share this information with you to illustrate that hard economic times is precisely the time to focus on quality and value while simultaneously working to reduce cost. Rather than reacting to the situation, we must plan aggressively for the future always asking, “how can we be more effective?”  “How can we provide greater value for our parents?”

Excellent Communication

We sometimes assume too much.  We assume that parents understand Christian education.  We assume that they know about our programs and the enhancements that we have made. 

The truth is that most parents are focused on their children and those things that immediately affect them. They are barely aware of “other” things going on in the school. 

It is important, however, that parents be aware of all school-related matters from the more dire, e.g., how the school is responding to the H1N1 virus to the new initiatives underway that will help their children.

It is an old advertising adage that it takes seven times for a message to “click”.  That means that we must communicate often using multiple venues and media.  Email, newsletters, meetings, Facebook, Twitter, one-on-one lunch meetings, the school’s website, etc……  Be creative but repeat repeat repeat! 

A Bias for Yes

I like to give my business to those who go out of their way to provide good customer service.  I am willing to pay more for good service.  So are most of our parents. 

The danger that we face is that we can create policies or respond in a way that demonstrates that “our convenience” “our policies” are more important than the needs and/or wishes of our paying customers—and they are customers! 

We strive to have a “Bias for Yes.”  “Yes we Can!” (Sorry, I couldn’t resist!)  “Yes we will.”  “Yes, we will seriously consider that.” 

Obviously we can’t always say yes.  I have had to turn down a number of requests from parents this year.  But I only do so when it is absolutely necessary to comply with important policies designed to enhance our service to parents/students or to protect them. 

We don’t say no because doing so is more convenient for us!

Concluding Remarks

The educational marketplace is more dynamic and competitive than it has ever been.  This new market reality combined with current economic difficulties create significant challenges and opportunities for our schools.  Although we cannot change the external environment we can and must adapt our internal practices and programs.  Adapting is the only way many of our schools will survive, let alone thrive.

How Facebook Can Affect Your Enrollment, Marketing, and Communication

According to Sharon Gaudin of Computerworld, a recent study shows that social networks for middle-agers (that’s most of us reading this article) are now a more popular form of communication than email.

I remember that just a few years ago many Christians, including Christian school administrators and teachers, viewed social networks as the exclusive domain of teenagers or were immoral, or both and therefore should or could be ignored.  Such a perspective was a mistake then and is a mistake now.  Social networks are a form of communication and social interaction.  Social networks are neither inherently good nor inherently evil.  HOW they are used determines their value.

According to a report by Nielsen Online (download PDF), social networks are used by two-thirds of all worldwide online users.  Social networks and blogs have become the fourth most popular online products.  The report lists e-mail as No. 5 on the list of users' favorite online tools. Search tools, portals and PC software topped the list.

Other highlights of the report include:

• Putting the growth of social networks – popularity and engagement – into context
• How the audience to social networks is changing
• The challenges facing advertisers on social networks
• What advertisers can do to find the magic formula for advertising in social networks
• Factors contributing to the Facebook phenomenon
• Why localization has won the day in many countries
• Where mobile social networking has taken the greatest hold
• What ‘traditional’ publishers can do in the face of the social network phenomenon

Mind Share

“Of the social networking sites out there, Twitter and Facebook seem to have the lion's share of the mind share these days. And Facebook has the lion's share of the market share, as well. In January, online researcher comScore Inc. reported that Facebook, once thought of as the up-and-coming social network, had overshadowed rival MySpace, with nearly 222 million unique visitors in December compared to 125 million for MySpace.

To back up comScore's numbers, Facebook CEO Mark Zuckerberg noted in a January blog post that the social networking site had hit a big milestone -- 150 million active users, nearly half of whom use the network daily.”

Neilson’s report also shows the significant increase in the time spent on Facebook:

In all the markets that the company tracks, Facebook is visited monthly by three of every 10 people online.

Our Parents and Prospective Parents are on Facebook

THE MOST SURPRISING FINDING OF THE REPORT is that Facebook’s greatest growth in global audience numbers has come from people aged 35-49!  Social networks aren’t just for the teenage set anymore.

This is the prime child rearing, school selecting age of the population!

Should We Use Facebook and Other Social Networks to Connect with Parents?

Frankly, I don’t know the answer to that question but I am researching the issue because I believe we should try.  Here are some of the issues to consider.

Our Mindset/Mental Model Must Change

Traditional advertising is one-way communication—the message is pushed or placed in front of the intended customer.

Social networks by definition are SOCIAL and therefore the “advertising” must be a conversation.  According to Nielson, “the point that social network members are co-creators of content and, therefore, have a sense of ownership within the site means advertising should be about participating in a relevant conversation with consumers rather than simply pushing ads on them. After all, it is social media. Advertising shouldn’t be about interrupting or invading the social network experience, it should be part of this conversation.”

This two-way conversation presents opportunities and problems.

Positively, it provides a framework for engaging in authentic conversations about education, Christian education, and our schools.  Facebook, for example, is a wonderful way to provide helpful information to current and prospective parents.

Negatively, we run the risk of false accusations and unjustified negative comments being made by disgruntled individuals.  The social network, if not managed well, could also foster gossip and slander.

In other words, promoting our schools through social networks can be a two-edged sword.

“Messaging within advertising should come from a more authentic, candid and humble perspective.

Social media has, once again, brought word of mouth to the fore as the ultimate form of advertising at a time when traditional advertising is suffering from a major lack of trust.

Nielsen’s analysis of social media conversations back in 2007 and again in December 2008 showed that ‘false’ was the term most closely associated with “advertising”.
Social media has fanned the flames of consumer distrust about advertisers claims. However, at the same time social media has provided the motive, opportunity
and means for advertisers to engage consumers in a more open and honest way.”

Building Trust and Friendships with Parents?

The report goes on to note that “social networks are ultimately about friendships, where members add value to each other’s lives through interaction.  Therefore, advertising should follow the same philosophy of adding value through interaction and consultation. Fan sites or sponsored groups are, perhaps, one of the ore successful examples of social network marketing that touch on the principles of interactivity and adding value …

However, the challenge for advertisers is that discussions within these groups won’t necessarily align itself with the brand-designed messaging. Much like a friendship, marketing on social networks requires continual investment – in terms of time and effort as opposed to financial – to be of value to both parties.”

In other words, some of the conversation on a Facebook fan page for our school will not reflect the message that we are trying to communicate.  Some of the comments posted by participants may be blatantly false. Although this presents a significant problem, it also presents an opportunity—an opportunity to correct false information, rumors, and gossip and to share positively the philosophy and impact of Christian schooling.  Doing so of course requires that someone from the school be fully engaged with the Facebook site.

What Do You Think?

• Does your school have a Facebook presence?  If so, why?  If not, why not?
• If your school has a Facebook presence, how has it worked?  Has it been a net positive experience or a negative one?

Technorati Tags: Facebook,Social Networking,Social Network,Advertising,Christian,Schhool,Education,Christian School,Christian Education

Are You Spread Too Thin? How to Thrive and Not Merely Survive as a Christian School

(Reposted from Google Blogger)

Dr. Barrett Mosbacker, PublisherI recently read an interesting article by the CEO of Yahoo! titled The Peanut Butter Manifesto. Click here to read the memo. I highly recommend it to you.

For the purposes of this blog article I want to focus on the following statement from the memo because it is instructive for us as school leaders.

"We lack a focused, cohesive vision for our company. We want to do everything and be
everything -- to everyone. We've known this for years, talk about it incessantly, but do nothing to fundamentally address it. We are scared to be left out. We are reactive instead of charting an unwavering course. We are separated into silos that far too frequently don't talk to each other. And when we do talk, it isn't to collaborate on a clearly focused strategy, but rather to argue and fight about ownership, strategies and tactics ...

I've heard our strategy described as spreading peanut butter across the myriad opportunities that continue to evolve in the online world. The result: a thin layer of investment spread across everything we do and thus we focus on nothing in particular."

Spread Too Thin: Strategic Allocation of Limited Resources

The Christian school movement is not particularly healthy. Based on recent statistics that I have seen, the number of Christian schools and overall school enrollments are stagnant or declining.

Although there are external forces beyond our control that affect our schools, many of our problems are self-inflicted. One of our self-inflicted wounds is similar to that articulated by the CEO of Yahoo!--we are often not strategic in the allocation of our tangible and intangible resources and as a consequence we are not offering a substantial marginal value to our current and potential clients. I am referring to our parents a clients because notwithstanding our missions as Christian schools, our parents are essentially paying clients who make economic calculations in deciding whether to enroll or re-enroll their children in our schools.

School Finance 101

If there is one unalterable truth about school resource management, it is this: the laws of economics do not discriminate. The laws of economics apply equally to both religious and non-religious institutions, regardless of their mission. The laws of economics are not religious.

Economic laws, like physical laws, apply universally to all regardless of one’s religion, one’s motives, or one’s hopes and dreams. Economic laws can no more be circumvented than the law of gravity because the laws of economics are as much a creation of God as the laws of physics.

The laws of economics are the laws of God. They are in the same way that the laws of physics are the laws of God … They are the laws of God because it is He that decrees the existence of the entities whose nature it is to obey those laws: had He wanted other laws He would have had to create other things ….Like physical laws they are necessary but only hypothetically necessary. They work positis ponendis. In other words, these laws are formulated in terms of “if then” statements. Economic laws do not tell us what human beings will or will not do, how they will behave, [nor how they ought to be behave]. They tell us rather what will happen if human beings behave in certain ways.... [Emphasis added] (Sadowsky, 2005, p. 3)

Assuming that God will suspend the laws of economics because the school is a ministry, too many Christian school leaders believe they can violate those laws with impunity. With the best of intentions, usually with the goal of making Christian education affordable for everyone, many administrators and boards establish financial policies that violate basic economic principles, good business practices, and common sense.

School leaders have a responsibility to understand and to apply economic laws and sound financial practices to the management of their schools. Failure to do so is a failure to apply the very biblical worldview to school management that is its raison d'être.

The Cost of Excellence

A basic law of economics is that for an organization to survive, let alone thrive, its revenue must equal or exceed its costs. This is just as true for “Pearly Gates Christian School” as it is for IBM. Common sense enough but it is surprising how many intelligent people violate this basic axiom of economics when filling a leadership role in the Christian school. Motivated by the laudable desire to provide a Christian education to as many children as possible, many school leaders abandon common sense. Sadly, such well-meaning intentions threaten the survival of the very ministry they so earnestly believe in.

Artificially low tuition is one example of violating basic economic law. Yet many administrators and boards routinely establish tuition rates below the actual cost to educate and compound the problem by providing multi-child and vocationally-based tuition discounts regardless of parents’ ability to pay. With inadequate revenue, programs are often under funded, limited, and of mediocre quality. Shallow fine arts programs, out-dated and/or underutilized technology, limited foreign language offerings, and limited or non-existent programs for gifted and special needs students are common.

Providing a world-class Christian education cannot be done on the cheap, it is expensive. According to the NCES (2004a), expenditures for public and private education were estimated at $866 billion for 2003–04. Expenditures for elementary and secondary schools alone were estimated to total $514 billion.

Public school per pupil expenditures for the 2001-02 school year averaged $8,259. By comparison, tuition per pupil in ACSI member schools in the same year averaged $4,642, a difference of $3,617/student .

This 44% differential is “funded” by paying below market compensation, through fundraising and/or church subsidies, by offering programs of limited scope and marginal quality, and/or by incurring debt.

Many Christian schoolteachers bear the burden of subsidizing below cost tuition rates through low salaries and poor benefits. Sixty-eight percent of teachers employed in ACSI member schools with at least 10 years of experience earn less than $30,000 per year, (Association of Christian Schools International, 2005). By contrast, statistics from the NCES (2002) show that the average starting salary for teachers with no experience in public charter schools that used a salary schedule was $26,977, compared with $25,888 for public school districts.

Education is a labor-intensive enterprise with labor costs typically representing 65 to 80 percent of a school’s entire operating costs, (William J. Fowler & Monk, 2001). The combination of below cost tuition and high labor costs results in artificially depressed salary levels making staffing the school with highly trained and competent teachers throughout the program difficult, especially at the secondary level.

Low salaries and poor benefits often produce high staff turnover creating discontinuity in the academic program. The applicant pool is small, forcing the administrator to hire the “best available” from a pool of relatively mediocre teachers. The result is poor to average instructional and academic quality, the loss of parental confidence, low student retention rates, especially at the upper school level, and a reputation for mediocre quality.

Many Christian leaders find themselves caught in a vicious and self-defeating cycle. Under funding produces poor quality, which in turn restricts enrollment levels and school revenue. To increase revenue, school leadership needs to raise tuition rates but many current and prospective parents do not believe that the school’s quality justifies the higher cost. Parents choose to leave or not to enroll their children in the school in the first place. In a desperate attempt to stem the loss of students or to stimulate enrollment, tuition continues to be set below actual cost thus perpetuating the cycle.

Supply and Demand

The theory of supply and demand is one of the most basic in economics. Simply stated, supply is the amount of product or service that a business or organization is willing or able to provide at a specified price. Demand is the amount of product or service that a consumer is willing to buy at a specified price, (International Society for Complexity Information and Design, n.d.). Modifying this definition for the Christian school market, the definition may read as follows; supply is the quality of education that a Christian school can provide at a specified tuition level while demand is the amount of tuition that parents are willing to pay for the perceived value of the education provided.  Everything else being equal, demand (enrollment) will be strong when the market (parents) believe that the school provides a quality of education valued at equal to or above the tuition charged. If enrollment is stagnant or declining this is a sign that the market does not perceive the value offered to be equal to the tuition charged.

Common sense enough, but things are a bit more complex than the foregoing definition implies. To grasp more fully the economics of Christian schooling, two other economic principles need to be considered; price elasticity of demand and marginal value. Relax; this is not as bad as it sounds!

Elasticity refers to market sensitivity to price changes. Demand for very price elastic products or services will vary significantly based on price. Relatively small increases or decreases in price will have a significant impact on demand. On the other hand, demand for products and services that are price inelastic is relatively stable even with relatively wide swings in price. For example, farmers face a relatively inelastic market; modest increases or decreases in groceries have only a modest affect on consumer demand for staples. However, airfares are elastic; even slight price increases or decreases in airfare can dramatically affect ticket sales.

There are several factors that affect elasticity of demand (QuickMBA, 2004):

· Availability of substitutes, the more possible substitutes, the greater the elasticity,

· Degree of necessity or luxury: luxury products tend to have greater elasticity. Some products that initially have a low degree of necessity are habit forming and can become "necessities" to some consumers, e.g., the microwave and the cell phone.

· Proportion of the purchaser's budget consumed by the item: products that consume a large portion of the purchaser's budget tend to have greater elasticity.

For the Christian school this means that, other factors being constant, the availability of schooling options in the community will affect the administration’s ability to increase enrollments and what can be charged for tuition. The more options, the more elastic tuition rates will be. Likewise, the fewer alternatives that parents have, the less elastic tuition will be.

The quality of alternative educational options will also affect tuition elasticity. If area public and private schools are considered poor relative to the local Christian school, enrollment in the Christian school may be perceived as more of a necessity than it will be if the community is blessed with a large number of high quality public and private schools. In the latter case, parents have a smorgasbord of quality educational options. If parents perceive the local public schools to be safe, high quality learning environments, they are more likely to consider enrollment in the Christian school to be a discretionary “luxury” purchase. Only the most diehard adherents to a Christian philosophy of education will consider enrollment in the Christian school a necessity. If on the other hand, local schools are perceived to be unsafe and of poor quality, “purchasing” a Christian education is more likely to be considered a necessity, making tuition levels less elastic.

The Archdiocese of Chicago provides a compelling example of this principle. Faced with declining enrollments and a school deficit of $20 million, the Archdiocese commissioned a study to determine how to boost school enrollment. Boffetti (n.d.) reports that researchers discovered that:

Struggling schools, at the very least, needed to fill every available seat with tuition-paying students. Surprisingly, many inner-city parents, both Catholic and non-Catholic alike, did not know that Catholic education would only cost them $1,000 a year, with the diocese picking up the rest of the tab. When they learned the facts, many said they would eagerly pay to get their children out of the awful and dangerous public schools they were in.

 Suburban parents were more sanguine. Parents who believed in the importance of Catholic education already sent their children to Catholic schools. The rest of the parents did not think it would be worth the added expense because they felt that their suburban public school system was at least equal to, if not better than, the Catholic schools in terms of academics and amenities [emphasis added]. In other words, the “Catholic” in Catholic education was not worth an extra $1,000 per year to them. (pp. 7-8)

Marginal Value

A closely related concept to elasticity is marginal value. Simply stated, marginal value is the amount of benefit perceived by purchasing an additional “unit” of a product or service in terms of other goods or services. Several factors influence marginal value: price and perceived value being among the most important. Brimley and Garfield (2002) define the marginal dollar (a way of understanding marginal value) as the dollar that would be better spent for some other good or service. In other words, as applied to the Christian school, marginal value or the marginal dollar can be understood as the calculation that parents make that an incremental increase in tuition, either at the school their children currently attend or at competing schools, is worth more than say a nicer home, car, or vacation. That is, as tuition increases, parents make a calculation that the added cost is or is not producing an incremental value equal to or greater than the increase in cost relative to other educational options and other purchases. If parents do not perceive the quality of education provided to be of more value than other options, parents will choose those options.

The impact of marginal value calculations made by parents is seen in the typical attrition rate from junior to senior high common in many Christian schools. Many parents conclude that the added cost of four years of Christian schooling is not justified relative to the breadth of programs offered by local high schools.

The reflex response by many school leaders is to assume that the way to increase the marginal value of their schools is to keep tuition low. This is certainly an important element in maintaining value. Another approach, however, is to increase the incremental value of the education provided relative to tuition charged by improving quality, expanding programs, hiring better teachers, and enhancing facilities. In other words, value can be increased by giving parents more for their tuition dollars. The balance between quality and cost produces a perceived value; it is perceived value relative to other educational options and other purchases that determines the willingness of parents to purchase a “Pearly Gates Christian School” education for their children.

Strategic Budgeting for Marginal Value

There are many ways to increase a Christian school’s marginal value: three of the most important are:

• Hiring superior teachers,
• Effective integration of technology, and
• Careful stewardship of existing funds.

To accomplish these goals school leadership should engage in strategic budgeting in contrast to default budgeting. Default budgeting is budgeting based on current realities, existing exigencies, and existing allocations. By contrast, strategic budgeting aligns planned expenditures to strategic initiatives designed to enhance marginal value. Leadership allocates funds based on the school’s strategic plan, not merely on existing spending patterns.

Strategic Budgeting: Personnel

For example, because a school is only as good as its teachers, one of the most powerful ways to increase marginal value is to establish a long-term plan to enhance the school’s ability to recruit, hire, and retain superior teachers by offering competitive salaries and benefits. To accomplish this goal, prayerful, strategic, and sometimes hard decisions have to be made concerning the existing allocation of resources. Are there personnel who need to be let go? Are there curriculum offerings that need to be dropped? Are there programs that need to be eliminated or reduced?

Suppose the school offers a home economics course. The administration may have established this course several decades ago because it met a need at the time. This course is assigned a teacher and allocated resources. However, there are only 30 students enrolled out of a total of 500 high school students. Given cultural changes, marginal value would be increased by eliminating this class and allocating the funds for a media literacy or graphics design course. Such a course would serve a greater number of students and would increase the value parents are receiving for their tuition dollar.

Reevaluating the standard salary scale is another example of strategic budgeting. The basic idea is to create salary ranges designed to differentiate pay based on market supply and demand. Under such a plan there may be different compensation ranges for different classifications of teachers, e.g., for scarce specialty teachers and personnel such as advanced math and science teachers or technology specialists.

The idea of creating differentiated salary ranges whereby certain teacher classifications are paid more than others is counterintuitive for most educators. Educated and trained in a system in which teacher salaries are based on experience and credentials, regardless of competence and market conditions, is deeply ingrained in the psychology of school leadership and in the structure of schooling.

However, to put differentiated pay into a larger context, it is helpful to note the following research findings as reported by the Educational Research Service’s report, Teacher Compensation and Teacher Quality (Goldhaber & Eide, 2003).

Current teacher quality and staffing issues have affected some subject areas more than others. For example, studies have shown that teachers of math and science have some of the highest levels of attrition among all teachers. Additionally, some schools face teacher quality issues with the math and science teachers who do remain in the classroom….

The fact that teacher shortage and teacher quality issues affect math and science especially severely can be explained with the teacher labor market and the single-salary schedule. Lakdawalla (2000) found that the returns to technical skills have outpaced the returns to teaching skills. Teachers with math and science skills are most likely to be able to have high-paying technical jobs as viable career alternatives. This means that the opportunity cost for math and science teachers has grown more than the opportunity cost for all other teachers….

We find that the shortage for math teachers is greater than that for history teachers, because the wages of teachers are inflexible. Thus, schools will have more difficulty hiring math teachers with an adequate level of training and also face greater levels of attrition in the current math teacher labor force….

Goldhaber highlights the severity of the problem of finding and retaining highly qualified math and science teachers for most schools…

This leaves schools with difficult choices and challenges. They could procure and devote unprecedented amounts of money toward teacher compensation [or] differentiate salaries by teacher skills…[emphases added]

It is quite likely that schools will have to raise compensation for math and science teachers in order to compete with the private sector and attract individuals with technical expertise in those areas. The above point suggests a need to restructure teacher compensation and move away from the single-salary schedule…and should include concepts such as the supply and demand for particular teacher skills. (pp. 38-52)

When assessing teacher compensation, it must be borne in mind that money is not the primary motivator for teachers. If it were, many would have chosen a different profession. Hiring teachers intrinsically and passionately committed to the ministry of Christian education is critically important to ensuring that teachers are kingdom rather than self focused.

Nevertheless, the “workman is worthy of his hire.” Creating differentiated pay ranges has the benefit of positioning the school to recruit and retain the finest faculty available while not requiring the uniform and universal raising of all salaries. The result is that the school is able to attract advanced science and math teachers while simultaneously avoiding the large tuition increases that would result from adjusting the entire salary scale upward. It also enhances the marginal value of the school by increasing quality and minimizing tuition increases.

Strategic Budgeting: Technology Integration

Leadership can significantly enhance marginal value by enriching the academic program through integrated instructional technology. The key concept is integrated. The vast majority of both ACSI and CSI member schools offer computer classes. Very few integrate the technology into daily instruction.

Technology integration means that technology is an instructional tool, not merely a subject of instruction. Integrated technology is the seamless infusion of technology in both instruction and learning so that technology becomes a ambiguous tool used by both students and teachers. It goes beyond computer labs to the natural incorporation of technology into teaching and learning as naturally as a white board and notebook. Using technology for the sake of using technology is not the objective. The objective is to use technology to enhance teaching and learning when it is the most effective way to teach and to learn. Technology is not the end; it is the means.

The following abridged example of technology integration for a high school class illustrates the concept. Although designed for high school, this lesson could be easily modified for junior high students.

Lesson objective: Students will deepen their understanding of the relationships between social and human capital and the creation of wealth in a first and third world country.

Lesson Content and Assignment:

· The teacher will provide background reading and lectures on social and human capital, biblical concepts of economic justice, fundamental principles of economics, and the impact of educational attainment on the creation of individual and national wealth.

· Students are to use library and Internet-based resources to research economic, demographic, and educational data for both a first and third world country using resources just as the CIA Fact Book, the Library of Congress, the U.S. Census, the World Bank, International Monetary Fund, etc.

· Data is to be collected using an Access database. Students will export the data to an Excel spreadsheet. Graphs are to be created depicting important data. Working with the math department, students will run a simple correlation analysis using Excel or a program such as SPSS.

· Students will use Word to write an eight-page research report. The report is to include embedded Excel charts and graphs. The report is to be in MLA format using Endnote for the citation of references and the creation of the reference section. This written report is to provide a discussion of biblical principles of social justice, a summary of research findings, and conclusions regarding the relationship between social and human capital to the creation of wealth in a first and third world country. Students are then to answer the following question: “What does this mean to me?”

· Students will use PowerPoint to present a five-minute summary of their findings.

Assessment:

· Students will be assessed using both a traditional assessment (test) and an authentic assessment. The authentic assessment is the quality of the research, the quality of the written report, the quality of technology use and integration, and the quality of their presentations. The teacher will use a rubric to evaluate the authentic assessment.

A useful middle school example is Was It Murder? The Death of King Tutankhamun: The Boy King. This lesson can be found at the following Internet site: http://www.pekin.net/pekin108/wash/webquest/.

Unfortunately, there is little evidence that Christian schools are integrating technology in a manner even close to the lessons described above. In a national study designed to assess the current level of technology access and integration, defined as Technology Level, in CSI and ACSI schools, Mosbacker (2005) found that the majority of CSI and ACSI schools are not characterized by the level of technology integration required to prepare students with the 21^st century skills needed in an information-rich, global economy.

The majority of the schools are at a relatively low technology level as measured by the CEO STaR Chart definitions. The STaR Chart is one of the most comprehensive categorizations of schools based on their level and use of the technological resources. The CEO Forum’s STaR Chart identifies and defines four school profiles ranging from the school with “Early Technology” to the “Target Technology” school characterized by integrated technology throughout the curriculum. The STaR Chart also matches potential educational outcomes — the potential benefits — to the level of technology and integration in each profile category. Based on technology presence and integration throughout the curriculum, the STaR Chart provides a technology snapshot of a school in each of the profile categories.

Most CSI and ACSI schools provide access to technology, there is little curricular integration.

Consequently, the majority of the schools are at a relatively low technology level with 77% of the schools defined as Low to Mid Technology. Twenty two percent of the schools are classified as High/Advanced Technology schools and only one school is classified as a Target Technology school.

Many parents will immediately perceive an increase in marginal value through the addition of integrated technologies. For this to become a reality, leaders will need to develop strategic budgets that fund the necessary hardware, software, and staff training, the latter being particularly important. Simply adding the funds for technology development without a strategic review of the existing budget may increase total cost unnecessarily. Realizing increases in marginal value will require reassessing current budget allocations and may require eliminating or reducing other expenditures in order to fund technology development without adding significantly to tuition. A combination of strategic budgeting and fundraising for technology purchases can make technology affordable while improving marginal value to parents.

Strategic Budgeting: Strategic Allocations

An important way to increase marginal value is to control cost by the prayerful and careful use of the resources entrusted to our care—stewardship. Jim Collins (2001) provides a poignant example of stewardship from the corporate world.

When we interviewed Ken Iverson, he told us that nearly 100 percent of the success of Nucor was due to its ability to translate its simple concept into disciplined action consistent with the concept. It grew into a $3.5 billion Fortune 500 company with only four layers of management and a corporate staff of fewer than twenty-five people—executive, financial, secretarial, the whole shebang—crammed into a rented office the size of a small dental practice. Cheap veneer furniture adorned the lobby…instead of a corporate dining room, executives hosted visiting dignitaries at Phil’s Diner, a strip mall sandwich shop across the street [emphasis added]. (p. 136)

Twenty-five members of a corporate staff to run a $3.5 billion dollar company is, by any measure, good stewardship! Look around. Has the school incrementally added more and more staff as it has grown? Is it necessary to have such a large staff? Can things be done more efficiently, for example, by utilizing administrative computing system more effectively and through better staff training? One method to assess staffing levels is to compute the total number FTE (full-time equivalent) employees to students. If that ratio is consistently increasing, it may indicate excessive staffing levels.

Being cheap is not equivalent to wise stewardship. Increased value and marginal return on the investment are the marks of wise stewardship. Being “cheap” does not promote excellence nor does it add marginal value. The wise use of resources through the strategic allocation of scarce resources does both. Excellence is promoted by allocating funds to strategic initiatives designed to enhance value and expand programs, e.g., hiring better teachers and/or developing integrated technologies.

Strategic allocation is no more complex than seeking the “biggest bang for the buck.” What will produce the greatest educational return on investment for the dollar spent? The concept of marginal return complements the concepts of marginal utility and marginal value.

Although a financial concept, marginal return, as applied to the present context, can be thought of as the return or impact on the school that is realized for the dollars invested.

For example, if a school has been given an undesignated gift of $50,000, the question is; where will that $50,000 dollars produce the greatest results? Should it be spent on new textbooks? Will buying new computers or science equipment produce a higher educational return for parents than spending the funds for a new bus or designating the funds for financial aid?

It is notoriously difficult to quantify the marginal return in the educational context. Nevertheless, carefully aligning expenditures to a strategic plan will increase the impact (return) for every dollar invested. The problem is that pressing short-term needs or pressure from parents often trumpets the strategic allocation of tuition revenue and financial gifts. Rather than allocating the funds based upon a strategic plan or upon a careful assessment of what will add the most marginal value for parents, many leaders spend the funds to cover short-term needs or to placate the loudest constituency.

Stewardship

If our schools are to survive, much less thrive, we must stop "spreading the peanut butter too thin." We need to think far more strategically. Where should we place our resources? What is the basis for our decision? What programs should we eliminate? What programs should we add? The the marginal value of our schools been stagnant or declining?

These are important questions that we must answer with ruthless honesty.

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Leading Your School In Uncertain Economic Times: Practical Suggestions

Many experts predict that we are headed for a recession. A recession in and of itself is not particularly worrisome. Like breathing, expansions and retractions in the economy are normal and keep the economy healthy and vibrant over the long-term.

What is of concern is that this recession may be deep and long. According to the Wall Street Journal:

The bailout plan was needed but more needs to be done to fix things, and we're not even sure a rate cut will be enough," a trader at GFT Global Markets says. To many Wall Street veterans, a painful, long recession unlike anything the U.S. has suffered in decades seems increasingly likely. (WSJ: Today's Markets, Oct. 6, 2008)

Given the turmoil on Wall Street and words like "crisis", "recession", "bank failure" and "depression" circulating in the media, it is not surprising that consumers have dramatically cut back on spending, The New York Times reports that:

Cowed by the financial crisis, American consumers are pulling back on their spending, all but guaranteeing that the economic situation will get worse before it gets better ... But in recent weeks, as the financial crisis reverberated from Wall Street to Washington, consumers appear to have cut back sharply ... Recent figures from companies, and interviews across the country, show that automobile sales are plummeting, airline traffic is dropping, restaurant chains are struggling to fill tables, customers are sparse in stores. Graph from the WSJ Business Section, Oct. 6, 2008-click on the graph to go to the article.

Whether the predictions of gloom and doom come true or not, it seems clear that we are in an extended economic slowdown, which may affect many of our schools. As school leaders, it is our responsibility to assess the situation and then to provide prayerful, faithful, and steady leadership.

My good friend Zach Clark, Westminster Christian School (St. Louis), put it this way:

1. We should have an attitude of gratefulness for the strengths we have as a Christian school like increased enrollment and strong budgets, freedom to make changes, talented staff, etc.
2. Be steady during this time when everyone is looking for a reaction. Be realistic but confident in our ability to act.
3. Be sure that our focus is on keeping our attitudes positive, and encourage each other to stir each other up to love and good deeds.
4. Look for opportunities to be effective and efficient NOW.
5. Become an expert in engaging and developing others, especially volunteers to improve our stewardship of resources and human resources.
6. This is an opportunity to turn people’s focus to the substance of our work. To not only allow, but also enable others to determine the value of a Christian education.
7. Wait and watch what the Lord will do, trusting in His faithfulness.

Preparing Our Students and Our Schools

So how do we prepare our schools for economic turndown, or even a possible prolonged recession? The role of the leader is not to react but to respond prayerfully and strategically. If the economy spirals into a long recession it will affect our families and in turn, our schools.

I offer the following series of possible contingent responses for your prayerful consideration if, as seems inevitable, there is a sharp economic downturn. Obviously, every school and local market is different, but perhaps one of these suggestions will be helpful.

1. Pray faithfully for your families and for your school ministry. As I indicated in a previous post, I do not encourage prayer because it is the expected thing to say or because it is the politically correct preamble to a real solution. I say pray because in the final analysis it is the Lord who grants wisdom and who will provide for our needs. Remember, your school ministry is the Lord's!

2. I refer you to my article Economic Crisis, Globalization, our Students, and our Mission (Era of U.S. financial dominance at an end: Germany) on possible ways to prepare your students for an economic downturn.

3. As much as possible, move toward zero-based budgeting or at least look at your budget from that perspective. Investopedia defines zero-based budgeting is "a method of budgeting in which all expenses must be justified for each new period. Zero-based budgeting starts from a "zero base" and every function within an organization is analyzed for its needs and costs."

This contrasts from the usual method of simply adding a percentage increase to existing budget categories or departments. This requires a strategic approach to school leadership. For more information, see my previous post: Are You Spread Too Thin? How to Thrive and Not Merely Survive as a Christian School.

4. Smaller schools need to assess the number of students per class to ensure that each class is at break-even on a contiguous basis. Depending on the school's expenses and tuition levels, break-even is usually 16-18 students/full-time teacher. If you have classes that are not at break-even you have built financial losses into the school's budget, which is never a good practice but is particularly problematic in during an economic downturn.

If you are losing money in any class consider how you can consolidate classes. For example, if you have two third grade classes, both of which are not at break-even, consider combining them and then hiring a full-time teacher and a full-time academic aide (and laying off the other teacher or making him/her the academic aide but at a lower salary (I know this is hard, but it may be the right thing to do).

Doing so will permit a larger financially viable class without sacrificing academic quality while reducing cost IF the teacher and academic aide are experienced and very effective. Obviously, this could present some PR issues so great prudence must be exercised. But if you have classes of say 13 each, combining them into a single class of 26 with a teacher and academic aide will cut cost without negatively affecting academic quality.

5. Increase financial aid. This is, of course, easier said than done, but increasing financial aid may be essential. There are several ways to increase financial aid; 1) allocate/earmark a certain dollar amount from tuition specifically for financial aid. For example, $50/student x's 300 students produces $15,000 in additional financial aid. 2) Approach parents with financial resources to contribute specifically to the financial aid fund. 3) If your school is a church ministry, ask the church in contribute (or increase contributions) for financial aid.

6. Stay on top of your accounts receivables. This is one of those areas that is hard but ESSENTIAL. Do not allow parents to keep their children in the school if they are not keeping their accounts current. I would not, however, dismiss a student mid-year if avoidable as this can be harmful to the student. However, re-enrollment should not be extended unless and until accounts are current. If the family has a history of slow payment, require at least a half-year of paid tuition before permitting re-enrollment.

Be patient, understanding, and creative in working with parents. "Do unto them as you would have them do to you." This does not mean that you are obligated to provide them a free education. You have no ethical obligation to do so. Doing so jeopardizes the long-term viability of your school (which is poor stewardship) and is unethical because tuition paying parents are subsidizing the non-paying parents. Schools are not banks.

7. Think of ways to expand your market. For example, consider running a bus to "outlying" neighborhoods to increase enrollment. Keep in mind that you need parents with the financial means to pay tuition so target neighborhoods accordingly.

8. Work on your retention rates! It is far easier to keep students than to recruit new ones. The key to retention is value, which is a function of price and quality.

Remember, if your community (market place) is blessed with a large number of high quality public and private schools, parents have a smorgasbord of quality educational options.

If parents perceive the local public schools to be safe, high quality learning environments, they are more likely to consider enrollment in the Christian school to be a discretionary “luxury” purchase. THIS IS PARTICULARLY TRUE DURING AN ECONOMIC DOWNTURN!

Only the most diehard adherents to a Christian philosophy of education will consider enrollment in the Christian school a necessity. We can make all of the theological and philosophical arguments about why Christian parents should have their children in a Christian school but this will affect the decision-making of only a small group of Christian parents.

The Archdiocese of Chicago provides a compelling example of this principle. Faced with declining enrollments and a school deficit of $20 million, the Archdiocese commissioned a study to determine how to boost school enrollment. Boffetti (n.d.) reports that researchers discovered that:

Struggling schools, at the very least, needed to fill every available seat with tuition-paying students. Surprisingly, many inner-city parents, both Catholic and non-Catholic alike, did not know that Catholic education would only cost them $1,000 a year, with the diocese picking up the rest of the tab. When they learned the facts, many said they would eagerly pay to get their children out of the awful and dangerous public schools they were in.

Suburban parents were more sanguine. Parents who believed in the importance of Catholic education already sent their children to Catholic schools. The rest of the parents did not think it would be worth the added expense because they felt that their suburban public school system was at least equal to, if not better than, the Catholic schools in terms of academics and amenities [emphasis added]. In other words, the “Catholic” in Catholic education was not worth an extra $1,000 per year to them. (pp. 7-8)

Increase the value of your school by improving quality (teachers are most important here), adding high-impact courses/programs, leveraging technology, reducing costs, and moderating tuition increases.

9. Consider merging with other Christian schools. This poses theological and philosophical challenges. However, merging Christian schools can reflect very wise stewardship through economies of scale, the ability to pay higher salaries, cutting costs, consolidating programs, and building larger fine-arts and sports programs, to name a few. Unless there are mutually exclusive theological and philosophical principles at stake, it makes little sense to have several small, struggling schools within a few miles of each other, particularly in a harsh economic environment.

Before considering a merger, keep the following in mind:

• You may need to create a transportation system. Convenience and cost (given current gas prices) are two high values for parents. If one school merges with another, one school will lose some students. This loss can be reduced by providing a transportation service for parents whose school closed.
• Emphasize the advantages the merger will create for students.
• Differences in preferences can be overcome and the schools can merge. However, fundamentally incompatible differences in theology or philosophy cannot and should not be compromised (e.g. a protestant school combining with a catholic school would reflect an unbiblical compromise, or the proposed merger of a fundamentalist school with a school committed to a reformed theology would be inherently incompatible theologically, culturally, and practically). Be careful to distinguish between policy and pedagogical preferences and fundamental theological differences. They are not the same but are often confused. The challenge is to determine what is preference versus what are genuine theological and philosophical differences and core tenets.
• One school must take over the other--a house divided cannot stand. One school board and administration must be taken over by the other. Seldom should board members or administrators be absorbed into the new school. More often than not this will be a recipe for conflict and failure. However, the personnel (support staff and teachers) of the school that is being merged/absorbed by another should be carefully interviewed and given priority for hiring provided they meet the absorbing school's standards. This is fair and just but the absorbing school is not ethically obligated to hire the staff of the merged school. Likewise, where there are redundancies in staff resulting from the merger, and there will be, only the best staff of either school should be retained. This seems harsh, I know, especially for Christian leaders. However, as leaders it is our responsibility to staff our schools with the best available personnel, which may mean in a merger that some staff from either school may be let go. If so, generous and fair severance packages should be provided and good staff who are laid off due to redundancies should be rehired if positions become available.
• Pride must be crucified! There is great pride of "ownership" by the leadership and founders of any organization, including Christian schools. However, our schools belong to the Lord--not to us! It is His glory and His kingdom that matters--not the sweat equity that we have invested in the schools we lead. Since the schools we lead belong to the Lord there should be no pride of "ownership" and no shame if one school must be merged with another. The merger may simply reflect faithfulness and wise stewardship for God's glory and the advancement of His kingdom. Pride should never prevent two weak struggling schools from combining if doing so ultimately benefits students by creating a stronger and more stable Christian school.

10. If you are a Covenantal school (a school that only enrolls children born to at least one confessing parent (1 Cor. 7:14), consider enrolling the children of non-believers. If the school's founding charter or theology/philosophy is covenantal, this will be controversial for leadership and for some parents. More so if your school is sponsored by a church, in which case approval by church leadership will probably be required.

I started out in Christian education as an ardent advocate for the covenantal model of Christian schooling but I have modified my position based upon theological considerations and personal experience (I have been founder and head of a covenantal school (Covenant Day School) and head of two non-covenantal schools, including my current school, Briarwood Christian School.

Great prudence and much prayer must accompany any discussion of this decision. The goal is to clearly discern the Lord's will in this matter. He has called some school ministries to serve only the Covenant community. Other school leaders and churches believe the Lord has called them to minister to BOTH the believing and non-believing communities. It could be that the Lord will direct you to change your ministry focus. Only prayer, study of God's word, and wise counsel will help you discern His will in this critically important matter.

Here are some things to consider as you prayerfully ponder this possibility.

(NOTE: This blog article is already too long so I cannot go into all of the details of why I suggest this possibility. If you have questions please contact me directly and I will be happy to speak with you.)

• I believe the decision as to whether the school is Covenantal or non-covenantal is a matter of Christian liberty. There is room for disagreement here based on the leadership's sense of God's calling, but I believe either model can be biblical, can advance the kingdom, and can glorify our Lord.
• I have been surprised to find that when a school is well-run with good leadership that there are no more problems in the non-covenantal school than in the covenantal school. This was counter intuitive to me until I gave this more thought. The short version of my thinking is this: non-believing parents who choose to send their children to a Christian school tend, by common grace, to share the same high standards for external behavior and academic achievement as many Christians (provided the school does not have a reputation as a reform [small r] school for troubled students). I find many Christians, on the other hand, to be antinomians (at least when it comes to their children) who, when confronted with a disciplinary matter, respond "I thought this was a Christian school--where is the grace!" Translation, grace means "no or only mild discipline, at least for my children."
• The admissions process is essential for ensuring a healthy school culture. I have found that having a "pooled" admissions process for grades 7-12, in which NEW prospective students are enrolled ONLY after they have interviewed with an admissions committee, is a very effective way to protect the school because only students who are deemed as good fits are enrolled. Frankly, sometimes the children of non-believers can be better fits then the children of some believers.
• The school must have strong caring school leaders who wisely and consistently enforce policies. When this is the case, I have found that enrolling the children of non-believes creates no more problems than those found in covenantal schools. On the other hand, when the school does not have good policies or when leadership fails to wisely and consistently enforce them, there will be problems resulting in an unhealthy school culture in both covenantal and non-covenantal schools.
• As a practical matter, the non-covenantal model greatly expands the school's marketplace. This has several advantages including larger enrollments and stronger finances. Under wise leadership, this translates into higher teacher salaries, improved instruction, expanded and higher quality programs, higher retention rates, and financial stability. This in and of itself is NOT sufficient reason to move from a covenantal to a non-covenantal model but if school/church leadership believe that either model, when done properly, can be biblical and that the Lord is leading them in that direction, then this model offers significant practical and financial advantages.

We may be facing difficult years ahead. Now is the time to prayerfully plan ahead. How are you going to position your school to not only survive, but thrive in uncertain times?

One of my favorite verses refers to King David's leadership:

For David, after he had served the purpose of God in his own generation... (Act 13:36, ESV)

We are called to serve the purpose of God in our generation, which includes providing godly, biblically informed, steady, and strong leadership for our schools during times of uncertainty. May the Lord grant us the grace to be beacons of light and steadfastness for our brothers and sisters and before a frantic and watching world.

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