President Obama has tried to inspire the collegiate world by setting a goal for the United States to have the highest percentage of college graduates in the world by 2020. Looking at this goal very simply, the colleges, especially state universities need to start graduating more students. The situation gets a little more complex when you realize that colleges rely very heavily on state funding, and with the economic crisis, most budgets have been cut. The University of Hawaii system has seen its budget cut over 20% from 2009-2011. So, how can you increase graduate rates with fewer and fewer resources?

The University of Hawaii system has decided to combine a performance measurement approach with an incentive system to implement a new "graduation initiative." The goal or outcome is to increase graduation rates by 25% in five years. 54% of students graduate today in 5 years, which is about average for university systems nationwide. Achieving this increase would put UH in an elite position of leadership when it comes to graduation.

In order to achieve the ultimate outcome of higher graduates, the UH system has identified 5 key driver measures, and has agreed to allow some of their funding to be tied to these measures. UH believes in the following measures

• Increasing the number of degrees conferred systemwide
• Boosting the number of native Hawaiian undergraduates and graduate students
• Increasing the number of science, technology, and engineering students
• Growing the system's pool of Pell grant recipients, and
• Increasing the number of transfers from community colleges

This is a very innovative approach for a university, but it is relatively commonplace in for-profit organizations. First you identify the key outcomes and then you press forward with measuring the drivers that you think will deliver the results you are looking for. They key to making this work for the UH system is to clearly communicate these goals throughout the system and to translate them to meaningful goals at each of the universities. Thus UH-Manoa and UH-Hilo need to see how they contribute to achieving these results.

With some careful monitoring and the ability to adjust if they determine that these are not the right driver measures, the University of Hawaii should be well on its way to increasing graduation results. Further, the increase in state funding is tied to these results, so taxpayers will soon be able to see if their money is being put to good use. Hopefully this process of performance management and incentive funding can be replicated in more universities and public institutions.

add comment »