Note: This talk was given to Catholic businessmen and women of Nashville at their monthly breakfast on the occasion of Catholic schools week, 2011.
Thank you for inviting me to speak with you this morning.
Last week, we celebrated national Catholic Schools Week, and so I’d like to stay on theme this morning by talking about Catholic Schools of the Future. To do that, however, allow me to talk briefly about Catholic Schools of the Past.
Imagine the following:
You’re a business analyst, hired by a national company to address these alarming trends :
• In 1960, the company had approximately 13,000 franchises around the country and a customer base of 5.2 million.
• By 2000, those numbers had fallen off precipitously: The company now has 8600 franchises and only 2.6 million customers.
• By 2010, it lost another 1600 franchises and an additional 20% of its customer base.
As best you can tell, there are three issues driving these numbers:
• In 1960, this company was one of the few privately held companies in its field. Over the last decades, a plethora of new privately supported ventures and new public initiatives have made the competition much tougher.
• Prior to 1960, the company was able to pull its best employees from a training center that didn’t charge the company for its training. Now the company must employ independent contractors who demand higher wages and who must be trained at company expense to attain the same skill set as the previous base.
• Each franchise must invest heavily in buildings and infrastructure to deliver its product. Unfortunately, many are now surrounded by customers unable to pay retail price because of changing demographics. The businesses are now too far away from the customers.
“What has the company done to address its precipitously dropping market share?” you ask the CEO of the company.
“We’ve counseled our franchises to look for ways to raise capital to improve their buildings and hire better employees” says the current CEO, fidgeting. “We’ve also suggested to keep their prices low and give discount pricing to those who might need it so as to keep brand loyalty.”
“That doesn’t sound like a winning formula”, you remark. “How can you reasonably expect these franchises to raise revenue for capital improvements when they can’t collect full freight for goods and services? "Let me ask it differently” you say. “What has the company done to help the franchises? ” “Well”, the C.E.O. says hesitatingly, we’ve created a national association of these franchises, and we have an annual convention to swap good ideas and conduct research that measures how we’re doing.
“It looks like your research says it's been a bad fifty years” you say. " Do you have a new business model? Have we tried to re-organize the way we do things? Or are you still pretty much delivering it the way you did fifty years ago?
“Uh… We've added some technology, but the business model is the same”.
It is impossible to imagine a company in the Fortune 500 operating this way. Their boards would have fired many CEO’s over those fifty years. The company is crumbling and yet they have no business plan, no plan for his franchises to re-structure, re-locate or try something new.
But this is exactly the state of Catholic K-12 education in this country. From our peak enrollments in the early 1960’s, we’ve lost more than 60% of our student population and closed 6,000 of our schools. In the last ten years alone, we’ve lost 1600 of those schools and 20% of our student population. (NCEA, Annual Statistical Report on Schools, 2009). Just last month the Archdiocese of New York announced it is closing another 27 schools next year—26 elementary schools and one high school.
It’s an absolute crisis. Our Church and our schools are making heroic efforts to stem the tide, but we’re tackling this crisis as if we just need to work harder and keep doing what we’re doing better. In the words of one of John Mayer's songs, we're "slow dancing in a burning room."
Catholic Schools of the Future will need to consider new paradigms.
I have five thoughts about this.
My first thought: Catholic Schools of the Future are going to have to be more willing to experiment with hybrid parish-regional models of Catholic schooling. Exclusively parochial schools—schools tied to a parishes—worked very well for the first hundred years of Catholic schools, but I don’t think it’s going to work for the next 100. City demographics have changed and will continue to do so, leaving once well-positioned schools in neighborhoods that can no longer support them. And so, a kind of Darwinian evolution takes place—the strongest schools, surrounded by the most affluent neighborhoods, thrive, while the weaker schools die a slow, painful death. I think we’re going to have to look at models—not in every parish or every school, but where this makes sense—where schools need to be linked to several parishes (for an example of this kind of model, click here). It’s not a coincidence of all the schools that have closed in the last 50 years, relatively few are diocesan high schools—precisely because they are not tied to single parishes, but pull from a broad geography. Regional schools are also more able to create robust financial aid programs that help subsidize families who need it, making Catholic education more accessible.
Second thought on Catholic Schools of the Future: I think we’re going to need to experiment with our traditional K-8, 9-12 model and look at different age groupings for our schools where that makes sense. When the K-8 model formed in the late 1800’s, there was virtually no competition other than public schools and elite, very expensive private schools. Now, it’s an extremely competitive market, with all levels of private schools and magnet schools. Statistics show that our schools become vulnerable when students move into 5th, 6th and 7th grade, because at that age, our schools compete against K-12 or 5-12 or 7-12 private schools that leverage their high school facilities—libraries, science labs, athletic fields, athletic programs, down to their younger kids. I think it's unrealistic to expect that stand-alone K-8 schools can duplicate those offerings. Remember too that although we talk about K-8’s, the reality is that many of our kids are not beginning in K anymore—they're beginning in 4 year old programs or even 3 year old programs, meaning by the time the child gets to 6th grade, he or she has been at that school as long as a the 8th grader has in a traditional K-8. So I predict that nationally, we’re going to need to look at other more competitive models—perhaps, for example, distinct middle schools, perhaps locating those middle schools on the campus or in the vicinity of the high schools, tied to some sort of regional paradigm. Or perhaps we need to think about K-12 schools like our private school counterparts.
Third thought: I think we'll need to look at new partnerships between high schools and existing elementary schools, where administration teams merge to run both schools. For example, in the president-principal model typical of diocesan high schools, the president may be able to help the elementary school by using his or her development office to help market that school and professionalize that school's external image. Or more radically, in Montgomery, AL we took two existing parish elementary schools, merged them with the diocesan high school to become a "K-12 school with three campuses", renamed the school "Montgomery Catholic Preparatory School," and made the president responsible for running a single business office and development office that served all the campuses together. Each campus, however, retained its own principal, who retained the day to day administrative responsibilities (for more on this, go here). This was a more realistic use of resources than expecting each elementary school to hire its own president, run its own business office and hire its own development director. It also allowed us to do things that our parents appreciated, like giving cross-campus discounts to families with kids at both the high school and elementary campus.
Fourth thought: To attract and retain the kind of teachers we want and to offer competitive programs with our private school counterparts, we are going to have to adopt more of a college tuition model for our schools. By this I mean we’re going to have to charge parents the actual cost of educating their child, while at the same time, increase our financial aid substantially. We can no longer be the cheapest game in town—the sisters are no longer with us. Yet the most highly educated, highly credentialed teachers in Catholic schools across the nation with 20+ years of experience rarely make more than 50,000/year. Most diocesan principals make less than 70,000/year. Think about trying to support families on those numbers after being in the same career for 15-20 years. Though passing on the faith remains our most central mission, middle class Catholics expect us to also offer first tier, competitive academic and athletic programs. We cannot do so if we’re priced at ½, or ¼ as much as our competitors. Being the cheapest will no longer sustain us. So I think we’re going to have to raise rates aggressively, but while we do so, offer robust financial aid and remove whatever stigma exists about applying for it. After all, almost 80% of full time college students in this country receive some sort of financial aid.
Fifth thought Regarding these paradigm changes, let us admit that our church is not very good at changing paradigms. We’re better at preserving and caretaking than innovating. In contrast, businessmen and women such as yourself are much better at strategic planning, much more adept at modifying on the fly based on what the numbers show you, quicker to change marketing strategies if necessary, more accustomed to risk-taking, more willing to innovate.
That’s why I believe Catholic schools of the future must consider models of institutional governance that give a greater role to committed Catholic laypersons such as yourself, not just within the local schools, but at a broader, diocesan level. The archdiocese of Chicago, for example, founded a Board of Education in the Spring of 2009 to help them make recommendations for the future of their schools. The Board was hand-picked by the bishop, and reads like a who’s who list of Chicago Catholics—CEO’s, university leaders, top level Catholic businessmen and women. They’re doing amazing things—I invite you to spend some time on their diocesan web site just to get a sense of things. But here’s the biggest news: for the first time in decades, Chicago Catholic schools opened with more students than the previous year. I don't presume to have all the answers, but I think if we empower people like you to dream, innovate and lead, there are new models and new ideas that you will uncover help us implement.
Of this I am convinced: We have a lot to work with in Nashville. We have two remarkable diocesan high schools. Most dioceses would give their right arm to have EITHER a Father Ryan or a JPII. We have many excellent, strong elementary schools. The active presence of the Dominican nuns is a tremendous blessing to Nashville, and has lessened some of the national effects I have discussed here. With a few exceptions, we are generally healthy. But that’s precisely the time to really plan for our future, to consider new paradigms and structures—from a position of strength….not from weakness or out of desperation.
I want to thank all of you who are already involved as volunteers in our schools or those of you who send your kids to our schools. If I or Pope John Paul II can serve you or your families in any way, don’t hesitate to call me.