Theme: Missing Opportunities by Being Too Internally Focused
Some schools have developed such a defensive stance as a result of the Great Recession that they're not poised to take advantage of future growth. In other words, they're so busy playing defense that they're not playing offense, either. In a basketball game, if you can't take the ball to the hoop on the opposite end of the court, you will score no points, which means that you will lose. A simple life lesson from middle school athletics: if you're on the court, you're playing, so you may as well have a strategy that produces points!
The Emerging Risk Survey underscores that executives are doing the same thing as many schools; too few are "going on the offensive and creating new opportunities. Only a small percentage said they are developing new products, expanding into new markets, increasing their distribution channels or establishing new business partners." Those businesses that are playing just as much offense as defense are following a formula (below) that is engendered by the top five emerging risks that I identified in Part 1 of my commentaries on this survey. The impact on strategies and objectives means that business have to do the following:
- implement changes to the cost base of the business
- drive cost management strategies
- effect financial growth trends
- develop alternative sources of capital
Although the business terminology differs somewhat from that which we use in schools, the impact of the risks is the same, basically: pay attention to the bottom line, adjust costs where you can, try to create your own self-fulfilling trend, and focus on non-tuition revenue sources that make a difference (i.e., not $500 here and there; try six-figure or seven-figure goals: be daring! be innovative!).
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