National Association of College and University Business Officers (NACUBO)
Annual Meeting - Boston July 19-22, 1997
Revolutionary Ideas
David Hornfischer
Vice President for Administration and Finance
Berklee College of Music


The 1997 NACUBO annual meeting at the Hynes in Boston drew its largest crowd ever with over 1400 participants, 150 spouses, 220 exhibitors, and 35 major sponsors. The program featured five general sessions, several spouse sessions, and special interest caucuses. And, the six sets of concurrent sessions had about seven sessions in each one, for a total of over 50 sessions.

The Berklee furnished music was coordinated by Rob Rose at several events including an Accounting Gospel Revival (Dennis Montgomery), the Bob Doezema Blues after Dark, Monday afternoon entertainment, and the Ken Zambello Jazz Rock Ensemble performance at the ending clambake elevated the event to new level.

A few of the general sessions are outlined below. For more information, check out the NACUBO site


Opening session: Transforming Higher education for the Knowledge Age. A town meeting format (kicked off by a Lexington/Concord fife and drum corps) featured a five-person panel session coordinated by consultant, Donald Norris, and consisted of four academic panelists including the Presidents of Emerson (MA), Norfolk State University (VA), Washburn University (KS), and the Provost of Boston University.

Norris, a frequent writer and presenter about the transformations in higher education needed for the 21st century, led a lively discussion sparked by audience questions. See his handout. Some issues discussed include the following.

New knowledge will generate a large population of individuals who will need to be educated. Will they come from traditional sources?

What role will new learning tools play? Will virtual universities emerge from the private or public sector to meet these new needs? Will these sources replace traditional institutions?

Financially, will this mean closing facilities, greater cost reductions, efforts to find new revenue sources, new ways to fund technology, and new ways of looking at people costs.

How can institutions become more agile to meet needs of new learners?

Will higher educationÕs traditional credentialing role be replaced by the corporate sector? Who will set performance standards?

How will we deal with new forms of competition? Will major universities compete electronically for students that have traditionally gone to schools closer to home?

The central position of faculty was noted. Will tenure survive? Will the use of adjuncts increase? How can faculty be more engaged in change?

Will schools be organized vertically into specialized niches vs. the traditional, horizontal, broad-based institutions? What about management structures?

Will individual assessment of students become obsolete as we seek to transform education into more of a team focus where team members grade each other and the teacher becomes more of a senior team member?

Is on-line teaching effective? For certain courses? Will better interfaces (voice activated) increase capability for on-line teaching?

Will future generations of students tolerate lecture/exam course formats? Are they the first digital generation?

Is higher education ready to change? When some of our cash cow programs are attacked by less costly alternatives and disappear, change may be facilitated. Institutions need to have a team effort to anticipate some of these challenges, starting with a review of programs that institutions can least afford to lose.

Will alliances with business become commonplace? Will the financial officer be asked to play a key role in those negotiations? How can we find a partner to help us better deliver our educational message?

CONCLUSION Leaders were challenged to seize the opportunity to introduce the new and untried. The panelists each identified a key issue at the end of their talks: the business officer is an important player in the leadership of change; the computer is as much a tool as the pencil was in the past; be ready to embrace change dictated by new realities; and donÕt rely on the organizational chart alone when initiating change and remember that perspective is probably worth 50 IQ points.

Nicholas Negroponte, Director MIT Media Lab - Being Digital.

The head of the renowned MIT Media Lab began by noting the entrepreneurial nature and speed with which new ideas were developed in the Media Lab. He noted that often the best ideas come from those who were rejected by insiders. Negroponte stated Òwhen people tell you ÔnoÕ unanimously, the answer is probably Ôyes.Õ Ò He cited the case of the high tech magazine Wired,(Vanity Fair for propeller heads) which he personally supported after its proponents were rejected elsewhere. He noted that a large number of children gave subscriptions to their parents for Christmas, in an attempt to say, Òthis is my world.Ó

He noted that the digital revolution was being embraced most actively by the young and the old, leaving what Negroponte called a group of Òdigital homelessÓ in the middle age (30-55) cohorts. However, America is still wired more than most of southern Europe and Japan and Asia. Northern Europe has become the most wired part of the world. He referred to projections that by 2000, there will be a trillion dollars of commerce on the Web from a billion users. Because of this he projected that the traditional teaching universities will be at risk as knowledge providers. He urged schools to upgrade how we create knowledge in order to teach it better. By 2015, half of US citizen may get their degrees over the Net. Poorer countries may develop this capability faster because they have a less entrenched establishment to overcome and greater cost pressures.

The MIT Media Lab, created in 1979, is a venture capital operation that funds good ideas. Students from across the curriculum participate, many of whom are non-traditional. Currently the Lab has140 corporate sponsors, with 5 interviewed every day. Negroponte discussed some of the more radical ideas under consideration now, such as a reusable newspaper so that a homeowner would have a reusable cartridge which would be reprinted daily from a computer. This technology could relate also to the car painting process by using a paint which could be changed electronically, the development of wearable computer clothing, and even the possibility of a phone embedded in the hand.

Negroponte concluded by discussing the management of the Lab, noting that with his travel schedule, he had to rely on others to manage the operation. He noted the key point of control was in hiring. After that, Negroponte concluded, what happens, happens. I thought this was an important insight.

Sam Thayer, MD, CEO of Partners Health Care, and President of Mass General Hospital - Change: The Constant in Health Care and Higher Education

Consolidation in heath care, business, and banking is a reality. Higher Education has been cocooned by society so far, but with the rapid pace of change, Thayer suggested this too may change. Higher Education is too expensive, inadequately accountable (no social input to its cost), and inadequately interested in performance; resources are managed more like a loose cartel and for-profit challengers are emerging aggressively.

Change is being hindered by our social tradition in which the learned professorate is charged with maintaining a body of knowledge to be passed along verbally to the next generation. Professors are expected to uphold a code of ethics, set and enforce standards, and value their profession more than its rewards. This expectation is challenged by those who see education as a business.

The health care industry faced many of these same issues a few years back, but cost pressures, managed care, excess capacity, technology, and the Clinton nationalization efforts have changed all of that. In Massachusetts the situation was more extreme because costs were higher due to university hospitals. Mass General and Brigham merged in 1993. This was difficult. Thayer told of a elderly Harvard-educated, Mass General doctor who grew up thinking there were were three enemies: Yale, the Brigham, and the Soviet Union. He recently wistfully observed that now there was only one left.

Thayer described the Partners Health Care Initiative (PHCI) whose goal is 1000 primary care doctors with 1500 patients each. With a national mission and populace, as well as research and philanthropy objectives, the initiative has been a major challenge. Annual deficits ($17 million) continue but now they have almost $750 million, and 200,000 patients who generate 4,400 visits per doctor. Beth Israel/Deaconess is PHCIÕs major competitor. There are now 5 medical centers in Boston, compared to 7 few years ago.

Thayer concluded by noting that managers need to decide early about leadership and governance, integrate into one system, value human assets, expect confusion initially, and communicate a lot.

Reengineering - Jim Champy, MIT professor and co-author with Michael Hammer of the 1993 landmark management book, Reengineering the Corporation.

This book brought reengineering to the forefront of management techniques and the co-author spoke about a number of issues relating to revolutionary new ideas and reengineering.

He noted that in todayÕs environment, there is no choice but to continue to drive for revolutionary change, to be able to manage big change, to appreciate its difficulty, and to be try to understand what the future might look like.

Underneath it all, change agents, in addition to striving for effectiveness, must constantly ask themselves, are we creating better places in which to work?

He observed that the three drivers for change described in the 1993 book, intense competition in open markets, less loyalty from more demanding customers, and an accelerating pace of change have already become secondary drivers. Primary drivers today are coming from advancing technology that has both increased complexity of tasks and created both generational boundaries and a world-wide shift from planned to market-driven economies. He warned that we in the U.S. have yet to feel the impact of true global competition.

The purpose of an organization must be assessed against this environment. We must evaluate our customers more closely, understand how to promote our products, and evaluate our strengths. This will lead to consolidation with greater focus given to that part of our mission that represents our true strength.

Champy noted that the two primary drivers of change are usually vision and fear. Higher education understands vision. We have not had to experience too much fear. Higher education change has been largely incremental and primarily in administrative support functions. We have not addressed academic change very effectively. Faculty have resisted Reengineering and efforts have been fragmented. The organizational structure itself has limited change initiatives. For change to happen in higher education, Champy suggested that a radical plan would be more effective than incremental efforts which have been easy to dispel. This is where vision and technology will come together.

Change agents need to watch out for those who will deny the future, claiming that none of this change will happen on my watch. Because educational organizations are smart, successful, and composed of polite people, they will be harder to change since there is rarely debate over real issues. Faculty must see a compelling need for change, which to-date, has not emerged in many schools. Efforts so far have been seen as administrative efforts to cut budgets, which has generated resistance. Change will it be embraced only if it is seen as a way to make the organization better. A different leadership style will be needed that is less process-oriented and more engaged in active decision-making that can demonstrate real results.

In managing change, Champy stated that one cannot communicate enough. He encouraged town meeting formats around the issue of where the leader is taking the organization. Employees need to see what the change means to them. They typically have two big questions: Is the leader competent to carry out the change? and, What's in this change for me? Conversation is needed to answer those two questions effectively .

Finally the speaker noted that leaders need to be prepared for conditions when authority gets dispersed. Then, more accountability will be needed. Power can be maintained by giving it up but only when the receivers of it are accountable. Then leaders can feel free to share enough information to let those handed the power make decisions.

Champy closed by outlining his vision for the future workplace. He suggested leaders need to do the following.:

1. Encourage employee participation with freedom to ask the profound questions about what was heretofore impossible. Believe in the human potential to do right at the moment of truth.

2. Encourage pluralistic thinking with multiple goals. Foster a culture in which an employee wellness account replaces blind obedience (this will be difficult for Asian cultures).

3. Realize management authority comes not from an organization chart but from those who do work well. He warned that many top managers who cease to be important doers could become irrelevant in the new culture.

Champy summed up by asking us to be sure that what we do adds value and that we maintain our sense of empathy.