Review by: Seufert, Sabine (2006-07-20)

This report analyses the role of IT for improving institutional performance and for cost reduction at the same time. The basic assumption of the author is a growing external and internal pressure on most nonprofit institu-tions in higher education to improve institutional performance.

Starting point of his analysis is the challenge of higher education institutions to deal with a broader revenue and cost pressure that is being increased simultaneously with the pressure to improve institutional academic perform-ance (in analogy to the famous movie in the 70ies he calls this phenomenon "Catch 22"). He forsees the follow-ing changes:- on the one hand, Revenue sources are changing, such as:- shrinking percentage of public funding spent on higher education- decreasing percentage of higher education revenues from public fund- increasing tuition inelasticity resulting from competition from peer and for-profit institutions- increasing and, for many institutions, risky reliance on gifts, grants, and contracts (relative to public fund-ing)- on the other hand, cost pressures, such as- requests by policy makers to improve the academic aspects of institutional performance, a task they believe will require additional expenditures and, therefore, additional revenues- escalating (competitive) tuition discounting for less needy, but highly qualified students

The author concludes that as a result six expectations can be summarized as performance obligations which can be operationalized by performance indicators. The six institutional performance obligations are:-learning accountability (e. g., comparative benchmarking across time of retention, persistence, and graduation rates)-program accountability (e. g. percentage of annual student increase)-expense accountability (e. g. account for the direct expense of instruction and other key lines of service)-affordability of access (e. g., ratio of the annual rate of change in undergraduate tuition/fees)-convenience of access (e. g., percentage of all degree programs which can be delivered asynchronously)-capacity for access (e. g. percentage of qualified applicants refused admission or admitted with delay)

To react on the resource/cost pressure while improving the institutional performance, the author describes two main strategies:-a defensive strategy: activities such as increase tuition, cap enrollments or resist accountacibility, with the worst-case scenario of the combination-a proactive strategy: stresses three activities in order to address the performance oblications: Quality (access and improve learning and services), flexibility (integrate self-service and as-needed help) and costs (increase student to faculty ratio, decrease credit-hour expenses and increase capacity).

The report gives an in-depth overview of the management perspective to improve the institutional performance. It is an helpful article to make clear and transparent what kind of performance criteria and indicators should be considered and what kind of strategies represent options how to response to the performance pressure. The au-thor describes very interesting examples of improved institutional performance where he finally differentiates between:-program and service flex redsign strategy: means to redesign academic and adminstrative services and pro-grams to provide options for individual customization while eliminating inflexibilites and inconveniences in their delivery and while reduing the unit expense of services (focus on flexibility, convenience and cost).-common-course redesign strategy: means to improve learning while also reducing direct instructional ex-penses for common courses that account for a significant percentage of all enrollments (focus on quality in-stead of flexiblity).

To his opinion, higher education appears to understand that IT is a necessary ingredient in any systemtic attempt to improve performance. But higher education doesn't understand that IT is not a sufficient ingredient for im-proving insitutional performance systematically. His report is actually an important contribution for higher edu-cation institutions to better understand the role of IT as an enabler to improve institutional performance and to proactively response to "Catch 22"!