Know your numbers

Friday, February 17th, 2017

When I was a newly minted executive at a Fortune 25 health-care company, one of the first pieces of advice I got from my chief executive officer was: "Know your numbers."

Those three words have turned out to be some of the best advice I've ever received. After all, numbers tell us a lot about an organization's performance - what's working well, what needs improvement and what needs extra attention.

Earlier this month, President Michael M. Crow delivered the annual operational and performance review for Arizona State University. Streamed live, the review lasted five hours and consisted of a multi-part presentation by the president and his executive management team with questions from the regents. 

The review followed those of the University of Arizona and Northern Arizona University, whose presidents and executive teams led similar reviews last fall.

Arizona's public university enterprise is intently focused on the numbers. With businesses demanding more qualified graduates, families demanding more affordable tuition and state finances demanding more entrepreneurialism, we need to understand how we are meeting the demand for greater performance while simultaneously fulfilling our obligation for accountability and focusing on our primary goal - ensuring student success. 

As the size and complexity of the universities has grown, and as our universities have become more differentiated in their missions, we have updated the board's oversight of university performance as well.

"OFRs," as they have become known, were introduced to Arizona's public universities in 2014 and have since evolved to become a signature element of the regents' fiduciary oversight.

The OFR is not the only in-depth review the regents engage in with the universities. Indeed, hundreds of hours are spent each year reviewing their activities from maintenance needs and new policies to enrollment and graduation rates and more. However, the OFR provides the regents dedicated time for in-depth analysis and study of each university's functions - time to delve deeply into subjects such as academics, research, technology transfer, student services, athletics and affiliated entities. Each OFR is accompanied by a summary of the university's performance in nearly 50 charts that document progress on key measures related to enrollment, retention, graduation rates, academic improvements, student financial aid, research, debt capacity, operating costs and overall financial strength.

At the same time, a university president provides an updated strategic, business and academic plan (akin to that of a 10K filed by private-sector companies) that considers the opportunities and challenges of the university, as well as the resources needed to achieve the plan. In turn, each plan ties to ABOR's statewide university enterprise plan that sets goals and outcomes for our public university system.  

Once completed, the OFR does not simply occupy a space on the shelf. Inside each university, the plan is used to guide the future direction of the institution, including its priorities and allocation of resources. Throughout the year, the university presents for regents' review and approval all related material and significant transactions needed to execute the plan, such as academic initiatives, operating budgets, real estate acquisitions and building improvements. OFRs are also used in the university development and regent approval of tuition proposals. Additionally, the performance metrics provide opportunity for closer examination throughout the year through regents' committee meetings.

Best of all, the reviews, data and accompanying materials are made public through the regents' website so that they are easily accessible for the public. There's an interactive feature to program your own data query as well. Within minutes, any member of the public can get a sense of how each of our universities is performing today and what they plan to do in the future:

A focus on quantitative measures for outcomes in the public sector is often derided by those who say we can't measure something as important as the care or development of a person. Of course, the people we serve, whether we are delivering health care or education, are not numbers. But without close examination of the numbers, we can't know how well we are serving them. Simply put, we can't afford to not measure something as important as the performance of our public universities.

When my former CEO called on me to deliver performance results for my business unit to a gathering of my superiors, I knew my numbers.

When Arizona calls upon our public universities to demonstrate their performance, we have the numbers. We have the plans to make them even better and we are dedicated to their long-term success.