[caption id="attachment_168057" align="alignleft" width="300"] Wesley College President Bob Clark says he's focused on proving ROI[/caption]

Wesley College President Bob Clark is well aware of the challenges that colleges - from small private schools like his to larger university systems - are facing due in large part to declining enrollment.  He's also heard the rumors swirling lately about his own Dover-based school, although he does point to a recent observation by Dover Councilman Bill Hare who, when asked if he's heard about Wesley's challenges, responded "You've heard that for the last 20 years."

But the talk persists, including complaints about Wesley redirecting $1.375 million in state funding earmarked for renovations to the Dover Public Library to helping meet operational expenses. Wesley reported $49 million in expenses in FY 2016, the most recent 990 data that's publicly available.  Other rumors center on Clark looking to merge with other institutions and spending levels.

Enrollment has been declining for a few years, particularly on the undergraduate side. According to Wesley's website, its undergraduate enrollment was 1,228 last fall, down 219 from 2017 and 372 from five years prior. Of those 1,228 students, 1,125 were full time.  And Clark concedes it will drop again when they report numbers next month.

Clark is the former Commandant of the U.S. Naval Academy and came to Wesley in 2015.  As a former military officer, he's not difficult to find or talk to, and in an interview last week, he was open about the challenges and the task ahead.  Wesley doesn't have an endowment to get it through tough times, so he is pursuing other options to preserve an institution he sees as critical to the state.

Early in the interview, he referred back to his military experience and the importance of making sure your team feels they have a voice and they're empowered, quoting from "Meditations" by Marcus Aurelius who said, "What does not benefit the bee does not benefit the hive either."

That's where his conversation with DBT Editor Peter Osborne began.  It has been edited for length and clarity, but this is a story we'll continue to follow.

What's your mission and how do you plan to accomplish it?  Provide our students the best educational experience possible so that they can make a positive contribution to the communities that then they'll go on to serve and then meet the educational workforce needs of our city, state, and region while providing a pathway through partnerships for alums to remain and prosper in our state.

I think the narrative around higher education today is wrong. It doesn't reflect the desired effect that we as a society want. For me, it's what we do. And that's what I meant in terms of pathways through partnerships, keeping kids here.  A lot of people don't realize this, but over 50% of our students are Delawareans. But even more important, more than 80% of our graduates stay here. So, talk about a return on investment. Folks come to Wesley and get educated with the partnerships and the support that surrounds our state.  That's a great thing about our state. It's small, it's inclusive and it's family. The students then stay here and they truly make a difference in their communities that they serve. The fact is, we employ 500 folks from full professors, students, staff, maintenance, adjuncts, and we provide $80 million a year - and that's conservative - to our region.

Other schools are having challenges with enrollment, and some are closing as a result.  If you look at our undergraduate enrollment, like almost all small colleges, and it's been on a decline. Not anything against the schools. It's just there's a lot of students that are at the point coming out of high school that for whatever reason are choosing to go into higher ed and the numbers are smaller. It will be down again this year. We have not been able to turn that around. But the glass is half full. On the graduate side, we not only turned around, we're almost close to vertical.

We focus a lot on the needs of the state as we look at programs and services and the return on investment to the Delawareans we serve.  For example, our nursing program is one of the tops in the state and we provide a large portion of Delaware's health care force. Our Masters of Occupational Therapy (which Wesley started when Clark arrived at the university four years ago), is the only one in the region. And that is one of the most-in-need professions in the country.

A lot of our success is dictated by the accreditation. For example, this last year we had roughly 400-500 folks vying for 40 Nursing slots. Our first class from our Master's of Occupational Therapy program just went through their certification exams and the pass rate was 100%, which is an order of magnitude higher than the national average.

How do you accomplish your mission? First of all, you have to be fiscally efficient. You look around at everything from how you handle consumables to what type of lights you use across the board. You have to expand revenue sources because small schools are tuition-driven. When undergraduate enrollment goes down, revenue goes down. Your expenses at the least are going to go up a little bit with inflation. That model doesn't work.  We're looking for partnerships, collaborations, and changing our business model.

Many smaller private schools have closed their doors in the last few years, for the same sorts of reasons. And to be frank, a lot of people would say that on paper, "Wow, they're much better off than this little school in Delaware."

So how do you buck the trend of being part of that?  I knew exactly what I was getting into when I came here.  What Bill Hare said about Wesley having challenges for the past 20 years, that is part of the school story.

For all practical purposes, we're revenue-driven. I saw the people here, the faculty, the staff who have dedicated their lives to these young men and women. A lot of our students, second generation, a lot of our students come here because they may have tried somewhere else and they succeed here. So, how do we buck that trend? We have to be a little bit more proactive than reactive. We start looking at really what do we fundamentally need to do to change the business model?

The norm is not good anymore. There are a lot of schools out there - ourselves included - that have a lot to offer, and there's schools that have a lot of need. The key is to find those institutions that could share efficiency, have a common culture, and at the end of the day provide the desired effect. So, you get these partnerships, you get these collaborations and now instead of having a campus of one, maybe you have a campus of two that opens up those opportunities.

Are you talking about the alignment of existing programs or are you talking about looking at things like a merger with a university that maybe is in a little bit different part of the state or a little bit different part of the region?  Both. Program alignment is important, and I've talked to my folks since I've been here. People (focus on us being private in regards to discussion about state support). I don't. I don't look at Wesley as the oldest private school in Delaware. I look at Wesley as one of Delaware's schools. We serve our community.

Our team together started the occupational therapy program in my first year. That was a huge need in the state.

My background is nuclear submarines, I know a little bit about technology. I would like to think I know a little bit about leadership. And so we get wrapped up a lot in STEM, which is very important. Science, technology, engineering and math. But having that liberal arts underpinning is extremely important as well because it's the soft sciences. It's the arts. Because I could be the smartest engineer in the world, but if I don't interact well with people and can't communicate my priorities, it doesn't move forward.

If you're talking about changing the business model, what does that look like and how long will it take? How are we different than these other schools that are shutting their doors? First of all, I think Delaware is special because of the access we have to state leadership and business leaders. Everyone knows each other.  That translates to support. People understand Wesley's worth. You just have to figure out how to get the funding to fix something when it breaks.

[caption id="attachment_168058" align="alignleft" width="300"] Wesley President Bob Clark has found facility efficiencies on campus. Photo by Eric Crossan[/caption]

I'll give you a perfect example. Two years ago, we had an HVAC system die in one of our residence halls.  We had to fix it. Did we have the funding? No, but we reached out to several foundations. There were local business folks who had excess material. Our maintenance folks became part of the demolition team and the repair team. At the end, we took an eight-month job that was quoted at close to $1 million and through partnerships, through internal rolling up your sleeves, through some foundations investing, we did it over the summer for less than $300,000. And in doing so, we also get some energy efficiencies - everything in there is LED, much brighter, and we saved tens of thousands of dollars a quarter going forward.

When I got here, Wesley College had only one energy meter across all the building on our 55 acres here. We had no idea whether one building was more efficient than another, and which buildings we should use for summer classes.  So, we got a small grant. We got everything metered. We'll go back to fiscal efficiencies. Figuring out how to run the buildings to save money is part of the revenue stream.

You said you don't think of yourself as a private institution. But the governor does. But the bond bill this year allowed you to redirect $1.375 million from the library renovation to operations. But can you talk a little bit about that state support?  First and foremost, the state has been incredibly supportive, and the governor's been incredibly supportive and quite frankly, it's up to me to prove the return on investment. We serve Delaware. We are here to ensure that Delawareans have the opportunity of education and then we should collectively ensure they have that partnership pathway to remain here and affect our community.  I told them to hold us accountable to ensure we do what they task. So I'm still working on some of our legislators to get that private/public out of the vernacular and look more at return on investment.

When we can educate half our students being from Delaware, we can take over 80% of our students and keep them in Delaware. When we can be the primary driver or one of them for our healthcare system in Delaware. Again, small school, big impact. Nowhere did I mention private or public return on investment.

Biggest accomplishment from the last nine to 12 months?  I would say the list is long. I mean, it truly is. There's a lot of goodness here and I understand it and I don't mean to minimize the significant challenges we have.

A few examples: Over the last several years, we've reduced operating expenses by close to $3 million. When I first got here, we started renting out the residence halls during the summer. The first year, we grossed around $145,000, made a few changes, and this year we'll net almost $300,000. It's just doing things a little bit differently.

We recently signed a letter of agreement with Rowan University in New Jersey in response to students saying they'd like to include engineering in our STEM program. So now there's a program set up where you come here, get a bachelor's, you go up there during a transition year, get a degree and you get right into your Chemical Engineering Program.

We're working with the Department of Education on a Title III grant that'll bring close to $2.5 million to help out with some of our IT stuff. We started an Informatics Program in math and as you know, nowadays, that transcends everything. Last year we started an eSports Club. Our sports program is nationally recognized, but we are doing eSports because that's what students want. As a result, we're now considering an e-Sport management component to our business program?

So that's a partial list. I'm glad you asked that because people get focused on the, "Well, hey, tough year for finances." That's understandable, but let's not lose sight of the good things that are happening here at Wesley.

Let's talk about some of the rumors out there. People say you had a deal in place with the University of Delaware and there was a unilateral decision that just, that wasn't going to move forward.  First of all, there was never a deal in place with the University of Delaware. There were discussions and they are great partners. We do a lot of things with them, but there was never a deal in place. There was just discussions about the opportunity of being part of that University of Delaware system. Think of it in terms of Penn State. You got Penn State, but you got Penn State Brandywine.  So we had some very, very preliminary discussions. We were doing some due diligence but it just wasn't the right time for the University of Delaware.  But that was not a done deal that somehow fell apart.

This is a beautiful campus, and it would be a huge gem for them, in terms of a downstate presence. We thought so as well.

Schools across the nation must fundamentally change the way they view things.  In fact, we are in discussions with several institutions about a partnership like that.  You can keep individual partnerships with businesses, investments from foundations, investments from the state, investments from alumni. That's all very important. And that keeps the train moving. But the track you need to keep that train truly moving into the future are collaborative partnerships that expand the opportunities for the states they serve and also become efficient in terms of a business model for the institutions they are. So we are, like I said, actively pursuing several right now and I wish I could give you more detail.

With the 990s lagging as much as they do. It's difficult to see the numbers for a private university and there is data that indicates you have some fiscal challenges. But more than one person has said to me, "they're hemorrhaging money" in terms of expenses being higher than the revenues coming in.  I wouldn't focus on hemorrhaging. You can't just cut your way out of it. You've got to find other revenue, but you've got to get more financially efficient. That's why we've reduced operating expenses by close to $3 million because there were efficiencies to add. That's why we're looking at what we do with the residence halls during the summer, and we're also pursuing a potential partner right now to occupy a residence hall or two during the academic year.

Because you have vacancies.  We have vacancies. We recognize it and we're putting ideas into place to mitigate it. The things we do here are to allow us to be on those strong footings, whether the finances are good or bad.

How different are the management and leadership challenges here at Wesley College than they were at the Naval Academy when you were the Commandant?  That's a great question. A lot of people confuse leadership and management. Managers do things right, leaders do the right thing. I knew what I was getting into. Very small schools don't have the backing and financial stability that a national service academy does. Having said that, I approached both exactly the same way.

I can remember a discussion with the officer responsible for leadership development about a yard patrol fleet, which were small crafts you train midshipman on. I asked him, "How do we refuel?" (His response was based) on a percentage that we use for large warships that are going to the Middle East.  I asked whether it should it be different if we're only going to Rhode Island.

They did an analysis and said we could safely reduce it 10 percentage points and save a lot of money.  My point is that did we have the money at Navy? Yes. But just because you have the money doesn't mean you stop looking for efficiencies.

We're creating that culture of questioning here. It's creating that culture of how do we do it better? How do we do it for a little less money so then you can allocate those resources elsewhere. Same thing here. The difference is when I came here, there wasn't a lot of that surge capability to reallocate, but you could still put processes in place as simple as getting all the buildings metered, changing out light bulbs with LED. Why does every department have a credit card for consumables? Let's have one where all the consumables come in to one place and then work a deal with a company to decrease the cost.

Our food service folks are great partners, but we asked about their commitment to our future and our students during contract negotiations. If you walk over there now, we have a brand-new den area and a brand-new serving area. Wesley College didn't have the money in our budget, but my partner who's investing in our future put it together for us.

I'm betting that you have a Dashboard. What are the key metrics you look at? When there's an issue, I face it head on and we have an honest and upfront discussions. I've told my faculty and staff that when we do things, hopefully you won't be surprised and if you are then I need to know so I need to change the way we communicate.

Does that mean everybody agrees with me? Absolutely not. Because there's been some very hard decisions that had to be made for the betterment of the school and the students. It's not popular, but again, there's a difference between likership and leadership. When it comes to potential partnerships, I don't want to get the cart before the horse. My board is very supportive and very engaged.  I regularly send them an update and it's kind of like your questions. It's in the same format each time and it's not the, "Oh, everything's great." It's here are the issues, here's what we're doing about it, here's the help I need. 

(Clark gets up and grabs the update)

I do a stoplight chart that's got the pros, cons and trends and then what we're doing. I always highlight a student and a faculty member so they can get to see their return on investment, but yes, every two weeks the Wesley Wednesday goes out.

Up here on the left you have the four pillars of our strategic plan. Over here you have the top five near-term priorities. Down here are interest items (so the responsible person knows it's on my radar). If you're the vice president of finance, you know I want to hear about debt reduction and the fiscal efficiency plan.  Or it reminds the person who's responsible for school security that maybe they haven't looked at the emergency plan for a while.  It's my way of, again, not directing, but seeding.

The current Interest list includes Spring Enrollment because we need to find a way to flip the year; Cultivating Educational Partnerships; and College Center complex HVAC system.  It's still operating, but we don't know when it will go, so we're looking at a whole host of contingencies in terms of if it does drop, what things do we move where, doing it now before it happens. I let everyone know my schedule. If I'm traveling, they can say, if you're going there, we're really trying to get an inroad to this high school; can you just stop by?" 

What does Wesley look like in two or three years?  The soul of Wesley stays the same, but the brick and mortar and the construct has to change and that goes back to the partnerships. I think a better question is what does higher education for smaller schools look like in three to four or five years?

I'd tell you the same thing. It looks like collaborative partnerships. It looks like consortiums. It looks like some of the states that have already started some decades earlier than others. The New Jerseys, the Pennsylvanias, the Indianas, the New Yorks where you have the primary research institution and then you have the various satellites that serve the various needs for that particular community. All working towards that common goal of providing the best educational opportunities to their constituency group, but also moving forward collectively the state and the region on the international level. That's what higher education in Wesley is going to look like.

Sam Waltz, who was the founding publisher of DBT, contributed to this story.