Monday, December 20, 2010

Prepublication Copy of The Affect of Attrition on the Budgets of 1668 Four-Year Colleges and Universities

 Prepublication copy

1146 College Get Failing Retention Grade: US Colleges Lose at Least $16 Billion from Attrition:
The Affect of Attrition on the Budgets of 1668 Four-Year Colleges and Universities

Prepared by
N.Raisman & Associates

December 2010

This report is a first-time study of the relationship of attrition to lost revenues in four-year public, private and for-profit colleges and universities on an annual basis. It is based on data collected from colleges and universities directly, IPEDS, the Educational Trust, college and university websites and reporting, as well as the College Board “Annual Survey of Colleges 2010”. The report calculated the average six-year graduation and attrition rates of 1669 private, public and for-profit four-year colleges and universities then applied predicative formulas to determine the amount of revenue lost by the schools due to attrition for the 2010-2011 academic years. 

Revenue lost from attrition
The 1669 colleges and universities lost revenue due to attrition in an amount close to $16.5 billion ($16,451,945,426) with the largest single school losing $102,0533,338 the smallest single loss being  $10,584; and the average school losing  $9,910,811 

The publicly assisted colleges and universities averaged a $13,267,214 loss from attrition; the  average private college or university lost revenue of  $8,331,593 and for-profit schools lost an average of  $7,921,228.

These are dollars which may have been calculated into the budgets of the schools but are still dollars not received as revenue.  They remain as losses to revenue and at the very least $16.5 billion dollars left on the table.

Grading schools on graduation
If the 1669 colleges and universities were graded as they grade students on an A through F with an A equal to a graduation rate of 90% or more; B 80-90%; C 70-80%;D60-70% and any graduation rate under 50% equal to an F the breakdown would be
43 A’s
101 B’s
165 C’s
259 D’s and
1132 F’s.

1669 schools would be earning a national average grade of D (51.52%) if this were a college classroom. They would be failing.

What strikes the researchers as significant is not merely the massive amount of money colleges and universities lose from attrition but that schools that graduate an average of less than 40% of entering students can attract new enrollment at all. Moreover, it is hard to understand that four-year colleges and universities that graduate less than 20% of an entering class even over a span of six years can remain at all attractive to potential students and remain in business. Furthermore, federal funds continue to support schools that cannot retain and graduate more than 20% of their students.

Some Immediate Observations
It is interesting to note that of the 43 schools that graduate 90% and more of an entering class, only three are public institutions:
University of Virginia
University of California – Los Angeles and
The College of William and Mary.
The other 40 are all private schools.

Of the top 43 institutions with an average 6-year graduation rate higher than 90%, most are “name brand schools” except for two small unbranded private colleges: Apex School of Theology (NC)  and Sinte Gleska University (SD).

Of the 43 lowest graduation schools, all with a graduation rate less than11%, 20 are private schools, 16 for-profit and 7 public institutions. One is a theologically-oriented school and one a tribal college.

No apparent patterns come out of the study related to explaining attrition such as size of school; public, private or for profit; costs; Carnegie level. What is apparent however is that every school in the study lost significant sums of money from attrition.  This is revenue that could have been captured in part to help during a time of fiscal uncertainty and contraction but was not.

Additional Consideration to Improve Retention and Revenue
Though no apparent patterns came out of the data as has also been found in other studies on graduation rates (which are the flipside of attrition rates), it is recognized that the schools could improve their retention rates by up to 84% if they focus more on student needs and concepts of returns on investment.

The 84% is a figure derived from seven annual studies2 of why students leave a college. They might transfer to another school but they drop out of the first school and take their tuition and fees with them. The results of the seven studies done with 2,400 students each after the students were out of a school for at least six months to allow students to respond to the study without emotional bias toward the school they left are below.

The four major reasons students leave account for 84% of the attrition rate:
1.     College doesn’t care,
2.     Poor service and treatment,
3.     Not worth it, and
4.     Schedule.

These are all issues related to academic customer service3 (and thus can all be addressed by the institutions to improve retention and revenue.  In fact, by addressing these issues successfully they could increase population by as much as 84% of the total number of drops. So for instance, a school that was losing $1,000,000 a year from attrition could recoup up to $840,000 by attending to the for academic customer service issues.

These are all issues related to academic customer service3 and thus can all be addressed by the institutions to improve retention and revenue.  In fact, by addressing these issues successfully, they could increase population and thus revenue by as much as 84% of the total number of drops. So for instance, a school that was losing $1,000,000 a year from attrition could recoup up to $840,000 by attending to the four customer service issues.

An initial consideration of schools should be whether or not the students that they admit might actually realistically be successful in the institution. It needs to be assumed that schools accept only those students they believe have a strong likelihood of succeeding in their studies and the culture of the institution. To do otherwise would have to advance a cynical supposition that schools accept and enroll students they know may not succeed just for their tuition, fees and collateral revenue. If this were so, they are doing a poor job of it since so many students leave the schools.

Finally, the study raises concerns about the future financial well-being of those schools scoring a grade of D and certainly those scoring a grade of F. How they can maintain a budget that can produce academic viability and quality needs to be looked at.  When a college or university is losing 60 to90% of its potential revenue, its needs to be a concern.

Moreover, when schools are losing 80-90% of their student body every year, it should be questioned not just what they are doing wrong but if any students should enroll there? Considering that the odds of graduating at the average school is less than an even bet at 1401 of the four-year colleges and universities. Students and families are “flipping a coin” for the odds of getting to the diploma which they seek at college for the future the college has marketed.

It may be argued by some that even exposure to college education is a plus and thus students who do not graduate have bettered themselves through their attendance. This is a self-serving and fallacious argument. Students enroll and attend college in search of the degree that will open the doors to a job and better life for them. Leaving college without a degree is in most every case not a gain but a failure of the school and student. The student has lost an opportunity and the money paid to attend college while the school loses future revenue and the opportunity to complete its mission for that student.

And as this study shows, the loss of revenue from attrition for schools is significant and hurtful to the financial well-being of colleges and universities. The financial and personal losses to the students are equally significant.


The formula used for calculating projected attrition loss was taken from Customer Service Factors and the Cost of Attrition: Revised and Expanded.4  92010) The formula is expressed as [(P x A ® SL) x T)]/2 with P representing a school’s Fall FTE population; A is the six-year annual attrition rate. So P x A yields SL, students lost then multiplied by T tuition. This is divided by 2 to account for the justifiable assumption that students drop after the first day and tuition is collected for the first semester from them but not the next. The formula does not account for uncollected tuition which will vary from school to school and add to the total loss.

Population in each school was reduced by 7% prior to the calculation for total revenue lost to take into account the findings of the IES report Persistence and Attainment of 2003-04 Beginning Postsecondary Students After 6 Years (2010)5

The attrition rate is a calculated annual average for the years 2003-4 through 2008-9. Using a 150% time to graduation rate provides the most accurate way of projecting each school’s losses from attrition for two reasons. First, it allows for a lenient calculation of graduation rates by not holding four-year colleges to a four year standard. This is in keeping with the accepted recognition that the average time to graduation is 6-plus years nationally. Second, the average provides for a more consistent attrition rate since the variation in rates from year to year for most all schools exists in a very small range of variance (+/- 2.36%). Thus what was the attrition rate from one year will be very close to the next and the use of a six year average mitigates variations.

It may be that in some schools the average graduation time is actually more than six years such as might be argued by some of the on-line schools such as the University of Phoenix On-Line but that information is internal and not reflected in the public numbers. Further, the calculations already incorporate a seven percent persistence rate as discussed earlier in the report.

Transfers Out
The issue of the number of students that transfer out of a particular school is not significant to this study since the objective is to look at the total number of students lost. If they are lost through transferring to another school, dropping out or even “stepping out with intentions to return at some date, they are still losses which in turn yield revenue losses to the university or college.

1.       Jean Johnson and Jon Rochkind with Amber N. Ott and Samantha Dupont “With Their Whole Lives Ahead of Them, 2008, Public Agenda; Frederick M. Hess, Mark Scheider, Kevin Carey and Andrew P. Kelly “Diplomas and Dropouts: Which Colleges Actually Graduate Their Students (and Which Don’t) 2009, American Enterprise Institute; William G. Bowen, Matthew M. Chingos and Michael S. McPherson Crossing the Finish Line: Completing College at America’s Public Universities 2009, Princeton University Press; Alexandria Walton Radford, Lutz Berkner, Sara C. Wheeless and Bryan Shepherd, “Persistence and Attainment of 2003-04 beginning Postsecondary Students: After 6 Years”. 2010; IES/NCES.

2.       Neal Raisman, Customer Service Factors and the Power of Attrition: Revised and Updated, 2010; The Administrators Bookshelf.

3.       N. Raisman in The Business of Higher Education Volme 3: Markeitng and Consumer Issues by John C. Knapp and David J. Siegel, 2009;Praeger.

4.       Neal Raisman, Customer Service Factors and the Power of Attrition: Revised and Updated, 2010; The Administrators Bookshelf.

5.       Alexandria Walton Radford, Lutz Berkner, Sara C. Wheeless and Bryan Shepherd, “Persistence and Attainment of 2003-04 beginning Postsecondary Students: After 6 Years”. 2010; IES/NCES.


1.     Colleges and Universities Alphabetically
2.     Colleges and Universities by Graduation Rates
3.     Colleges and Universities by Attrition Rates
4.     Colleges and Universities by Revenue Lost (most to least)
5.     Private Colleges by Revenue Lost (most to least)
6.     Public Colleges by Revenue lost (most to least)
7.     For-Profit Colleges and Universities (most to least)
8.     Colleges and Universities Graded

If you wish to see any of the tables, just write to me at and I'll be happy to share them. I am accepting comments and suggestions as we finalize the report for publication. Thank you

Wednesday, December 08, 2010

"If the School Don't Fit;;Don't Admit" Buying a Dress and Academic Customer Service

Retention can be understood in part by buying a dress. When a woman buys a dress she wants something that will be a good fit. She also wants to be attractive, for her to look good in it and for it to be worth the cost of the dress in her mind. Like buying that dress, the final decision to buy or not is not an intellectual conclusion It is an emotional one. It is a decision that is supposed to make you happy. (Unless you’re a bridesmaid and have to spend a lot of money on what is almost always a bad looking, ill-fitting and costly ugly choice. But in the analogy that is the same as having to choose a school which is a runner up and not the top choice.) If the choice does not make you feel as if it is a good fit which means it is does not provide an emotional, affective and financial (time, money and effort) return of investment, then the dress is one that is discarded or returned. For a school, that means a student leaves it hanging in his or her historical closet and walks away from it.

This is an emotional not intellectual decision. The initial shopping can and will often be an rational one. I need a dress. I want it to be a certain color, size, hem length, style, price range and even brand. So I begin by looking for dresses that fit that initial logical set of considerations. Dresses that do not fit into the intelligent framework are not considered, at least at first.  For a school these considerations are often level of selectivity. location, size, majors, and name value. Those that do not fit into the schema are not looked at.

Then the purchaser goes to the store to look at dresses that could work and to try them on. The schools visit, tour and even stay over. This will eliminate some contenders but the decision to continue to consider is now an emotional one. What dress fits well? What dress looks right on me? What shade of the color I want is really the right shade? Does the length look right for me? Does wearing it make me feel good? Attractive?  More appealing? Does it make my butt look big?

The same is true of schools now under consideration? Did visiting or applying to it make me feel good about myself. Will it make me look smarter? More fit for the job I want? Does it make my brain look big? These are not intellectual issues but purely emotional ones that go to the core issue of “is the dress/school a good fit for me?”

The salesperson in the store will of course try to make the buyer believe the dress is a great fit, makes the buyer look wonderful and by the way, you look just right in that dress. Cash of charge?” In a similar way, the admissions office of some schools try to make the school a good fit by tailoring the image to the students’ desires. In fact, some intelligent schools even use CRM to totally tailor the school to the specific shape of the student’s interest. These schools will even have current students who are similar to the prospective student email or call to reinforce the feeling of a good fit just like a salesperson in a store may call over another salesperson to give her “opinion” on how the dress looks. If there are any issues, the buyer is assured that the situation can be altered to fit better. They are after the sale so they do all they can to convince the student that this is the right school and fit so apply here now.

The decision is made.  The dress or school is bought and brought home. But if that initial sale and fit become questioned there is a problem. If the dress is worn and in the actual wearing it feels too big, or tight or the color is wrong or the neckline off, hem too short or long or the color is not complimenting the original feelings about it.  In other words it is not a good fit finally.. The purchase either gets discarded (dropout) or returned (transfer).  The buyer feels she was oversold quite often and loses faith in the store. She decides not to go back so the store loses future sales as well as the school loses revenue it would have gained from the student who leaves.

So what determines a good fit? Will I get an emotional, financial and affective return on my purchase? These three roi’s will determine if it is finally a good fit. Now it has to be granted that there are times when the label of the dress, the name of the school will override the balancing of the three returns on investments. Sometimes  a person buys a dress primarily because the label is a designer brand and that name alone will make the person fit into the dress even if it is not a really good fit in and of itself. And because the name and the cost are high, the person will likely continue to wear the dress even if it is tight for example. It is so affectively satisfying to say “the dress? Oh, well it is a NAME BRAND”. Or “I go to XXXX”

But there is an additional factor in the decision to buy. The way the store treats the customer. If the employee of the store or the college is not courteous, does not provide good customer service, makes you feel unworthy or sells too hard and gets caught at it there is an automatic decision that this is not a good fit. The potential dress buyer or student leaves quickly. Equally negative is indifference to the customer. That is also a form of bad service.

And don’t be fooled by the cost of the dress or school and the student’s ability to by either. If someone feels the fit is there, wants the dress of school enough he or she will do what is necessary to get that dress if they feel they need it. For example, that ugly bridesmaid dress discussed earlier, the buyer will get it even if it is much more expensive than it should be because the need for it is there. The dress may be ugly but it is a definite fit for the need. The school may not be all the student wanted but if it where he or she can get a major leading to a life goal, the student will by it even if it is expensive. There are credit cards and student loans for that purpose.

But if the fit is not there, believe it or not it is better to do what you can to dissuade the person from buying the school unless it is a choice or a necessity. Because if you sell the school and the fit is wrong, you have wasted your energy, will lose money and a customer who will tell at least twelve others that the buying experience was very disappointing. Don’t go there.

To paraphrase Johnny Cochran “If the dress don’t fit; don’t admit.”

 The author Dr. Neal Raisman is the leading presenter, researcher and consultant on customer service for retention in colleges, universities, community and career colleges in the US, Canada and Europe. He and his associates have provided retention solutions for over 300 schools and businesses that want to work with higher education. Dr. Raisman is the author of over 400 articles and four books including his latest bestseller The Power of Retention; More Customer Service for Higher Education available from The Administrators' Bookshelf in hard copy and digital editions.

If you would like to discuss a retention issue or see if he has a time available to come to your school or business for a workshop, presentation or other retention solution such as a full customer servicing audit,
CALL 413.219.6939 begin_of_the_skype_highlighting              413.219.6939      end_of_the_skype_highlighting OR CLICK NOW FOR A FREE 30 MINUTE CONSULTATION ON ANY RETENTION OR CUSTOMER SERVICE ISSUE. Start improving your enrollment and revenue NOW.
413.219.6939 begin_of_the_skype_highlighting              413.219.6939      end_of_the_skype_highlighting or email

Monday, November 29, 2010

Golden Age of Rudeness

Welcome to the Golden Age of Rudeness.

Yes, it is true. You have been living in an age in which rudeness is a normative behavior. It is likely that you may have been treated rudely at sometime today. Or you may have been rude to someone else and not even noted it because it is just what we do.

We have lost our sense of manners, never mind politeness.  And this is true of our students and ourselves. Captain Kangaroo would be so depressed. All he asked is that we be polite to one another. Please. Thank you. That’s all. Thank you rather than f%k you.

We live in a very uncivil time. A time when our so-called leaders don’t lead but degrade another. A time when decorum is gone. When doing good is replaced with doing what is good for me.   

A time when it is not only accepted to publicly insult the president and the office, but it seems to de rigeur. And there is pride and support that follows rather than shame and indignity. Heckling at the State of the Union address leads not to censure but to support and fund raising. Heckling of the university president as she addresses the faculty meeting has also become acceptable. Is there much difference? Perhaps in the level of public exposure but it show the same disrespect for the person and the office.

We have lost our way. We do not show respect for others. And that occurs on our campus as well and what is worse is we can be the perpetrators. We who are to positive role models to students  have become as rude as they are.  Ignoring a student who stands before your desk because you “are busy doing something.” Not showing up for office hours when students expect you so they might get some extra help to succeed. Not helping a student who you know is in trouble with a problem.  Letting the phone ring in the office because it is not my turn to pick it up. Not returning voice mails or emails. Using language when talking to a colleague or student that shows a level of disrespect for the other.  Doodling, writing, reading, texting while a colleague or an administrator is talking because you just don’t care what he has to say. Ignoring one another or students when we walk in the halls or across campus. Coming to a meeting late or not at all then holding the committee up because you do not agree with what they concluded at the missed meeting. Answering our phones when with a colleague or student. And letting one student disrupt a class or come in late or text or show disrespect to you and the rest of the class.

Or not bothering to acknowledge a job application. Or getting back to those who were being considered for a position- even finalists - with a ‘dear occupant” rejection. Or even worse with a generic email. How depressing. Or not getting back at all.

And of course all the gossiping and slandering we do behind the back of another. My goodness, academic love to natter away with some rather outrageous hearsay, rumor and slander mongering. And how do I know, not simply because I have observed and heard but I participated too. It was just part of academic culture. When colleagues got together it was for a bitch session about this one or that one.

Yes, we can be rude too. And yet we can get upset when our students who are to learn from us are also rude. They live in a rude society and we are part of that. So if we want our student to become less rude we need to do the same.

Becoming less rude
So how do we start? Simple. Recall Captain Kangaroo and do what we try to get our children to do. Start by saying please, thank you and you’re welcome. Do it long enough and it may become a habit you once had.

Avoid looking for the negative in people.
Be patient with others.
Realize others could be competent too.
Try to stay out of the campus gossip.
Return voicemails.
Answer emails
Use academic not street language.
Show respect for others.
Hold the door for someone.
Be there for students and others with a smile on your face.
Don’t accept rudeness as the way things are.

Then smile as if you are happy and as you walk through the halls say hello to people. In fact, make it a goal to say hello to at least ten people you do not know. Ask people how they are and listen to them. If they could use some help, help them.

This is just a start. Will it change students for the better? Maybe after a while and a concerted effort from everyone. But it will change you and that is a grand start.

Tell us about rudeness at your school and how you and others are working to end it.

If you found this article had some merit, you may want to read more about how not to be rude, providing good academic customer service and Captain Kangaroo in the best selling book The Power of Retention: More Customer service in Higher Education by this article's author, Neal Raisman.

Order a copy through the Administrators Bookshelf NOW