Educational institutions turn to CRM, predictive analytics

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As hundreds of thousands of college students nationwide hand in their final exams, pack their bags and head off campus over the next several weeks, higher-education administrators - busy number-crunching next year's budgets - will be left to ask: How many will return to campus in the fall?

At a growing number of universities nationwide, administrators and student recruiters are turning to the mathematical science of predictive analytics to better forecast student retention and enrollment. Higher-education institutions need to successfully recruit, retain, inform and service students and alumni to be competitive in a market where the competition from other institutions is intense. They have even coined their own term - "student lifecycle management" - to refer to the process of following students from prospect to alumni and supporting them all the way.

"The pump is primed for CRM in higher education," said Nicole Engelbert, senior analyst for education and vertical markets technology at Datamonitor PLC.

"In the last 18 to 24 months, two things have come together: a growing realization that institutions will have to compete with one another far more than they have in the past to recruit and retain students, and the fact that by 2010, demographics will shift and the boomlet will end, so there will be more competition and fewer students to compete for," she said.

Ms. Englebert said that the international market is also making schools more competitive: More and more U.S.-based students are being lured away by these institutions because their schools are less expensive but just as high in quality. As a result, universities are turning to CRM to help them compete more efficiently.

Another reason CRM is growing, according to Ms. Englebert, is because as institutions grapple with less funding, institutions are keen to find ways to do more with the same or with less. And this is the hallmark of CRM.

"The automation of administrative tasks is the hallmark of CRM," she said. "Because of CRM, sending out e-mails is not something that a team of work-study students have to do, but something that a CRM system just does."

Ms. Englebert also said that in most university settings, the IT infrastructure has improved so that CRM systems can work properly.

Darling Clementine

Thulasi Kumar, director of information management and analysis at the University of Northern Iowa, says his administration relies on the power of predictive analytics to more accurately determine enrollment figures for the coming semester and school year.

"By more accurately predicting return enrollment of students, we have better control on budgets and expenses," Mr. Kumar said. "Just as important, we use the predictive technology of SPSS to take proactive measures to ensure the majority of our students return to campus in the fall. That's what's important to the university and at the top of the list for parents and students as well."

The school uses Clementine data mining software services from Chicago-based SPSS Inc. (www.spss.com) to identify students who are likely to drop out of the university, as well as to understand the factors that influence a student's decision to join and continue at the school.

The university has a Web portal that students and staff can customize, as new programs and services are often communicated online.

In addition, it recently sent some targeted e-mail campaigns to understand student behavior.

"This was done to validate and improve the data-mining models developed in an earlier project to understand and improve student engagement," Mr. Kumar said. "Students who are highly engaged at the institutions tend to stay at the same school until they graduate."

Mr. Kumar said there are two major obstacles to the implementation of CRM in higher education.

" One is the initial investment for CRM as well as a steep learning curve in understanding the state-of-the-art CRM practices as applicable in the higher education sector," Mr. Kumar said. "There is also a fundamental difference between the business industry and the higher education sector. Unlike business, in higher education students are learners, not customers. Service is the goal."

He said more universities and colleges are investing in CRM products and services to attract and retain students because of declining state support for higher education and the increased competition for new students.

Executive privileges

CRM is also being used successfully by Florida Atlantic University' s College of Business. The school needed to create a consolidated view of its students to employ more effective marketing and recruitment efforts, as well as to increase visibility into the recruitment and admissions efforts.

The FAU's College of Business is a leading regional business school, offering a diverse set of management education programs, including a Virtual MBA and a Ph.D. in business administration. It offers bachelors, masters and doctoral degrees and other executive education opportunities.

FAU believes that delivering high-quality and diverse education opportunities are critical to the success of the university.

After teaming up with Intelliworks and its CRM software, the admissions and recruitment process worked as a whole instead of fragmented operating silos, and it saw a 30 percent rise in graduate business college admissions.

"With the increasing number of universities initiating executive education programs, FAU needed to stay competitive," said Vegar Wiik, program director at FAU.

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