Why Risk Management Is Important in Higher Education

September 14, 2019 0 By Ronny Jaskolski

Risk management is all about finding the events
and occurrences, strategies and trends that could prevent an institution from being successful.
It’s also about – risk management is also about finding the opportunities that one should
take advantage of. So it is really a business tool, a process, risk management is to look
ahead and survey the landscape, survey the scene, the macro and micro environment and
identify things that can help an institution be more successful or it could set it up for
not being successful. And that risk – that’s what risk management is on a very high level
perspective. I think the reason risk management is so important right now is there are a number
of issues that have changed over the past five, ten years. I’ve been involved in serving
higher education for about – a very long time. And so what’s different now is there is much
less margin of error for institutions. There’s much greater opportunity for something wrong
to go happen. And because there’s a general discussion that the business model of higher
education may not be sustainable for an awful lot of institutions, having a handle on what
things or occurrences, trends could happen that could derail the institution is more
important now than it was probably ten years ago or even five years ago. And so the things
that can change for an educational institution that can really put it in parallel, the demographics,
clearly 2008 and 2009 shook a lot of institutions to their foundation. The competition – I was
taking the Metro down today for this discussion and I saw advertisements for Drexel University,
Penn State, and two other institutions. I had to remind myself that I was in Washington,
D.C. and not in another city. So competition and who is looking for our students is very
different now than it used to be. So Boards have to be more engaged in looking on the
horizon with the institution on what sorts of things could derail its plans.