HBCU Lessons For Lemoyne-Owen College

While all institutions of higher education struggle with the problems of reaffirming their accreditation on a cyclical basis, the unique problems facing Historically Black Colleges and Universities (HBCU’s) have been pernicious in recent years.

The recent problems at Lemoyne Owen, while well known to those of us in Memphis, are not the only ones for this group of institutions.

Everyone jumped for joy when Lemoyne Owen came off probation on this week. As reported in the Chronicle of Higher Education: “LeMoyne-Owen College … had been put on probation for financial troubles. The college was able to raise money from its surrounding community, including $3 million from the City of Memphis, to get out of debt and become financially solvent…(Interim President) Johnnie B. Watson, interim president of the college, said the money raised help turn $1.5 million in debt into $2.3 million in surplus. ‘The community really got involved to save this historically black college,’ he said, ‘the only one in the area.’”

The Commercial Appeal reported it this way: “The college had been on probation primarily due to budget trouble and lack of resources for its library. SACS determined that those problems had been remedied.”

The CA then went on to quote Mr. Watson as saying: “When I came on board a year or so ago, I was charged with creating stability at the college and making sure we were reaffirmed by SACS…With that goal achieved, my mandate is to continue building the organization’s foundation as the groundwork for future reinvention which includes strengthening fiscal controls, shoring up fundraising and enrollment management and securing major academic and program grants.”

Two days later the CA accurately reported in a headline: “Relieved LeMoyne isn't out of the woods; College still needs more money, students and plan to transform.”

The Recent Track Record

In recent years, 10 historically black colleges have closed, merged with other institutions, or lost accreditation. When institutions — historically black or not — lose their accreditation, the most common reason is that they got into a financial hole they cannot dig themselves out of.

Ms. Belle Wheelan, President of the Southern Association of Colleges and Schools, said that historically black colleges have sometimes gotten into hot water "because they were trying to live beyond their means." For example, some colleges have opened programs in expensive specialties for which there was too little student demand. She pushes colleges to step back from such budget-breaking commitments, holding up as an example institutions like Clark Atlanta University. In 2003, the historically black institution announced that it was closing its 10-year-old engineering department. Clark Atlanta students are still enrolling in engineering programs through collaboration agreements with several other institutions.

Desegregation vs. Competition

From 1976 to 2005, enrollments in postsecondary degree-granting institutions rose by 57 percent overall and gains in minority-student enrollment accounted for roughly half of that increase. Minority enrollments increased by 269 percent in graduate programs and by 331 percent in professional programs during this period. While the enrollment of students at HBCU’s has grown since 1975, the percentage of minority students receiving degrees from HBCU’s has declined over 33%. The impact of affirmative action and the admission of minority students at previously majority institutions have contributed significantly to this shift.

The shift in enrollment has occasionally led to charges by HBCU’s of unfair competition by majority institutions. Several states have passed administrative rules and legislation restricting universities from offering programs which may cut in to the enrollments of HBCU’s. This has been the case in Maryland where, in a recent interview the president of an HBCU, Morgan State University, Earl S. Richardson, said his institution needed more power to challenge plans by other colleges to duplicate its efforts because the state still has not eliminated the vestiges of its past segregation and put its historically black public colleges on an equal footing. He called the bill passed by his state's Senate "a monumental step in the right direction, toward achieving comparability and parity."

But at another Maryland institution, Towson University, a majority institution, President Robert L. Caret argued in an interview that Morgan State had proven unable to offer an M.B.A. program that would attract large numbers of students. "I fully support our HBCU's," Mr. Caret said, "but they have to realize that they are in a capitalistic society, and at some point they need to be working with these programs to make them competitive."

Similar problems have plagued other HBCUs. In Louisiana, Grambling State University is under a consent decree to increase enrollments of non-minority students. In response, it identified several programs targeted to increase the number of non-minority students (tactics have included scholarships and graduate assistantships targeting white students).

These strategies have not resulted in the intended outcomes. The quality of the programs is frequently cited by students in responses to questions about why they are unwilling to make the move. A graduate nursing program at Grambling has proven to be high quality and has attracted large numbers of majority students; this has lead to some faculty and students on campus referring to the building which houses the program as “the White House.”

In Texas, historically black Prairie View A&M University fought last year to block the University of Houston from establishing a new satellite campus in the northwest suburbs of Houston, where it was likely to compete for students with Prairie View. The Texas Higher Education Coordinating Board voted last September to allow the new campus, but it placed enough restrictions on it — stipulating, for example, that Prairie View could have a say in which programs were offered there — that the University of Houston abandoned its plans.

HBCU’s Aren’t Alone

Quite a few higher-education institutions are at risk in 2007 and beyond, according to Moody's Investors Service, which gauges colleges' financial health. They include small private colleges with limited geographic draw, colleges with ambitious spending plans to improve their national reputations, regional public universities that face heavy competition from community colleges, and HBCUs.

Terrence MacTaggart, a former chancellor of the University of Maine system and editor of Academic Turnarounds: Restoring Vitality to Challenged American Colleges and Universities (ACE/Praeger, 2007) and his colleagues have examined what it takes to turnaround these institutions. They look at three myths about turnarounds: only money matters, autocratic leadership is best, and faculty members don't play much of a role. The reality turned out to be a contradiction to each of these myths.

Myth 1: Only Money Matters

To be sure, money is important. But restoring financial health is only the initial step in turning around a distressed institution. Such transformations usually have three phases. The first is creating a business model that yields a balanced budget. The second focuses on marketing programs and building or rebuilding the college's reputation or brand. The culminating stage is what is called "academic revitalization." It requires an institution wide effort to redefine the educational mission, to imagine new ways of teaching and learning and to
communicate that renewal of academic energy both on and off the campus.

Myth 2: It Takes a Dictator

Albert J. Dunlap, onetime head of the Scott Paper Company and a legendary takeover artist, earned the nickname "Chainsaw Al" for his slash-and-burn tactics in turning around sluggish companies. He immediately fired 11,000 employees before selling Scott off.

The myth lingers that, especially in the early stages, turnarounds in higher education demand a brand of ruthlessness akin to Chainsaw Al's. This would seem to fit well the leadership model frequently found in HBCU’s. An article on leadership at HBCU’s by a professor at the HBCU in Jackson, MS., Jackson State University, finds that the structure of leadership at these institutions frequently follows, what he calls, the plantation model; referring to the authoritarian model of the southern plantations of the slavery period in US history.

In contrast to the myth, MacTaggart found that while the most effective turnaround leaders in higher education were decisive, to be sure, they were also collaborative. This fits well with his finding regarding the third myth.

Myth 3: Faculty Members Don't Play a Key Role

In fact, professors often sound the alarm that a college is failing, and there are numerous examples of faculty leadership in turnarounds. With their jobs on the line, faculty members at beleaguered institutions are often more sensitive to inadequate presidents and flawed strategies than trustees are. Faculty members are, of course, central to designing and offering new academic programs during the marketing phase of turnarounds.

Few colleges are so distressed that they cannot be turned toward a brighter future. To transform underperforming institutions usually requires new leaders who combine tough-mindedness with collaboration, and who recognize that fixing the balance sheet is only a first step. Successful turnarounds demand that virtually all key groups on a campus, particularly the faculty, contribute to making tough choices, help reposition the institution in the academic marketplace, and find the inspiration to revitalize the teaching and learning experience.

Why We Should Care

African-American men who attended historically black colleges and universities in the late 1970’s and early 1980’s enjoyed higher lifetime earnings than those who attended other four-year colleges and universities, according to a study conducted by two Virginia Tech researchers.

The researchers found that the black men in their study did not reap any benefit from attending a historically black college immediately upon graduating. But over their lifetimes, their wages increased 1.4 percent to 1.6 percent faster per year than did the pay of black men who had attended other colleges.

Noting that other studies have suggested that black men face greater wage disparities relative to white people than black women do, the researchers said the social networks that the black men in their study formed at black colleges may have helped them close the wage gap over time.

The long-term wage benefits that black men derive from graduating from such a college "appear to a large extent to be attributable to the fact that HBCU’s enroll disadvantaged males, in terms of pre-college attributes, who initially earn less than non-HBCU males, but eventually catch up."