Assessing Student Success Initiative ROI—Pitfalls to Avoid

As institutions increasingly turn their attention to outcomes and student success, what is frequently missing from the conversation is an understanding of the higher education business model. To effectively analyze student success initiatives (SSIs), institutions should first identify the cost of initiative implementation. Next, they should extend this understanding of cost to include an understanding of the initiative's return on investment (ROI)—both to students and the institution. In this way, ROI is redefined to include student success (progression, fewer excess credits, reduced time to degree, more completions) and contributions to institutional financial sustainability (savings, efficiencies, more net revenue). By capturing both cost and ROI, institutions can benefit from past experience and avoid common pitfalls. We describe some of those pitfalls here.

Assembling the Wrong Team

Before beginning an assessment of cost and ROI, institutions must assemble the right team to populate and interpret the data and analysis. In addition to the principle grant investigator (in the case of grant-supported projects), institutions should include representatives from institutional research, the finance offices, and academic budgeting. In general, institutions should treat the assessment as a business model analysis.

Failing to Capture All Costs: No Free Services

Institutions should ensure that they capture the total resources used to implement the project. This includes revenues and expenditures that extend beyond grant funding alone; all personnel and operating costs should be included, some of which may be paid out of existing institutional budgets.

Ignoring KPIs

Using key performance indicators (KPIs) can support increased transparency and accountability. Institutions should clearly define project success by creating performance metrics. This process encourages the institution to tell the project story in tangible ways—that is, what the project is attempting to contribute and how its success will be demonstrated.

Forgetting Previous Investments

SSI projects are often built on previous investments. The question is when to include those earlier investments in the assessment of cost and ROI. We recommend using the following three questions and considerations as a guide:

• Could the current initiative be implemented without the initial investment? If not, then include the initial investment.
• When did the initial investment occur? Although there is no hard and fast rule for time periods, institutions should establish an investment window regarding which earlier investments to consider; typically, this is not more than two years prior to the start of the current initiative.
• Does the initial investment benefit the initiative specifically, or is the benefit broadly distributed throughout the institution? An ERP system implementation, for example, would impact the institution too broadly to count toward an SSI implementation. A module related to degree audit, however, might be appropriate to consider given its narrower focus on initiative-related goals.