Well it is not exactly uncharted waters, but I do think that Kent State’s plan to pay bonuses to faculty for meeting institutional goals is very interesting, and perhaps a step down the less traveled path in public higher education. Right now the administration is incentivizing fund raising, research grants, and student retention. The formula for all three areas is that faculty will equally divide a cut of the additional revenue that flows into the university if a specific goal is reached or exceeded. In a nut shell:

• Student Retention:
  • Incentive = 40% of additional revenue
  • Goal = 0.5 increase
• Research Grants:
  • Incentive 10% of additional revenue
  • Goal = $2-million increase
• Fund Raising:
  • Incentive 2% of additional revenue
  • Goal = $2.8-million increase

Some information can be found at Kathryn Masterson’s, September 5th news item in the Chronicle of Higher Education, If Kent State Beats Goals, Professors Will Profit. You can do the math, but I think that at most institutions, nobody is getting rich.

So what are the potential upsides and downsides for the major stakeholders here?

• Faculty
• Learners / Students
• Parents / Partners
• Kent State
• Other Higher Education Institutions
• Administrators (Development Officers, etc.)
• Society in General (including tax payers)
• Donors
• Research Funding Agencies and Foundations
• Etc.

I would imagine, that even though executive leadership at Kent is talking in terms of sharing the wealth and success, I would think that the numbers of dollars shared with faculty will serve more as an artifact that illustrates some form of institutional community for the University rather than an opportunity for faculty to enjoy a significant income stream. It will also provide some focus on what the institution values. Tying some form of very low risk personal gain to student retention, research, and fund raising will keep those goals “front and center,” which is not where they would be if they were just listed as part of the University’s strategic plan, some presentation materials, etc.

Who knows, this bonus scheme might also raise some provocative and important questions about how “Retention” is measured and who (which learners, programs, and divisions) ought to be included in the measurements. Who qualifies as a member of the faculty? Why would it only be faculty who are included? This of course raises the question of who at the institution is included and excluded from the community, which might erode some of the culture strengthening benefits that could be attained, if a culture of shared success is being sought at all.

This approach has some connection with some industry practice of using bonuses as motivators and enculturation tools. I have spent most of my adult life serving higher education institutions, and all of my career I have been involved in education more generally. I have made brief forays out of the academy and into “industry.” For a while I served Harcourt Higher Education, which had its ups and downs, the last word is articulated pretty well in the BNET article Thomson buys, then shuts down Harcourt’s Higher Education web site, and then I served Spotfire, which in my opinion was a very well run (led and managed) organization that used personal and organizational performance bonuses very effectively. I have some thoughts on the matter of effective performance bonus practice in general, but am very interested in what others think of the application in higher education generally and how Kent State is applying their bonus incentive structure.

In any event, good on Kent State for “sticking it out there” and trying this. Whether you like the idea or not, this is something that I think we can learn from as it unfolds. Why are they doing it, would they be doing it, and does anybody know of other institutions that provide faculty bonuses through revenue sharing?

Posted: Sunday, September 14th, 2008 at 9:06 am
Filed under: World Campus
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Tags: World Campus

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