The adoption of cloud-based communications platforms and other virtual tools in higher education has made a world of difference in today’s new flexible learning environment. Leveraging technology to facilitate hybrid learning, distribute source material more efficiently, and manage administrative functions has helped to keep many colleges and universities from shutting their doors altogether when the pandemic hit.
But what about the office of finance? CFOs and other finance professionals in higher education require the same kind of agility, if not more, to address the financial impact that new learning models have had on their institutions. That impact includes the dramatic shifts in income that come with making tuition modifications to accommodate online or hybrid students who previously may have been paying extra fees, including room and board.
Let’s explore all of this further.
The Virtual and Blended Learning Experience
The pandemic caused a drastic shift in how colleges and universities function and educate students – and that blended learning shift is here to stay. This has changed the landscape when it comes to student engagement and delivery of communication.
For example, there are presently more options for securing certificates or diplomas online and interest in this is growing, because it’s quicker and less expensive and enables students to start earning faster. Many higher education institutions now find themselves competing with these offerings or looking to offer something like this themselves.
Adding to that, students are now comfortable with a hybrid learning environment, and it remains a priority for many of them. In a survey of 2,600 students, faculty and administrators conducted by Barnes & Noble College Insights, almost half of learners (49 percent) noted they prefer a hybrid class format.
This data is further supported by research conducted by Quality Matters and Encoura Eduventures Research in its Changing Landscape of Online Education (CHLOE) report. In the survey of 300 Chief Online Officers at U.S. colleges, respondents predicted that by 2025, programs and courses that offer both on-campus and online learning experiences will become the norm, and that the full shift to a blended model for higher education will become effective by 2025.
All of this requires institutions to maintain flexibility and agility across the board, including in their finance offices.
Higher education was growing at roughly the same year-over-year pace in pre-pandemic times, providing some consistency for institutions when it came to predicting cash flow. But, this hybrid learning shift removes that consistency in revenue by forfeiting fees charged for on-location students, such as room and board and activity fees. Adding to that, students attending virtually have no interest in prestige factors that may have attracted them to their institutions before COVID; e.g., a state-of-the-art gym and/or robust athletic program. As a result, hybrid learning can not only impact fee revenue, but it also can affect enrollment.