Let’s start with your background, your current role and an introduction to your respective organizations. Keith, would you like to start?
Keith Fowlkes
My name's Keith Fowlkes, I'm the executive director and one of the founders of the HESS Consortium. I worked in higher ed for 35 years or so and was a Chief Information Officer (also in higher education) for quite a while; about 26 years. So, I have a lot of background in these topics.
The HESS Consortium is not a GPO (group purchasing cooperative), it’s a community of practice for Chief Information Officers and technology professionals in private nonprofit colleges and universities. We help our CIOs to work together and bring their staff together to find new ways of collaborating with different major companies across the country and globally. Additionally, we have lots of opportunities for technology professionals to develop connections with other technologies.
This is what HESS does.
Larry Kamons
My name is Larry Kamons. I am the CEO of the Independent College Enterprise (ICE). I spent perhaps the first third of my career as a software developer, did a lot of consulting work over the years, and ended up working for a very large bank where I managed many enterprises facing critical shared services. Then, I recently left the bank where I worked for over 20 years and came to the Independent College Enterprise. We're a very small consortium working on behalf of our member schools, supplying the enterprise resource planning (ERP) and student information systems (SIS) to those schools. So rather than schools running the software on-prem and needing to have a DBA, a systems administrator and other support staff, all of that support staff is shared and we run the infrastructure for them. We don't do their operations, we simply provide support when they need some technical help and we make sure that everything is highly available, running efficiently and can be disaster recovered if need be.
So, both of your organizations are in their own way collaborating specifically in technology. Is this something that is more in response to the cost of software in recent years, or is it a trend that might be in place for a longer period of time?
LK (ICE): ICE is a mature organization. We are a nonprofit and I report to the presidents of all the member schools. It's been in existence for a little over 20 years, so it's not new. If I were to come up with a mission statement, it would be to save money for my member schools. That's what we do. we run their IT infrastructure for their ERP and student information system, which is the majority of IT for any university or college. We keep the costs as low as they can possibly be and our existence saves the member schools dollars.
KF (HESS): It’s very similar for me and the HESS Consortium. HESS was basically born out of the need to find economies of scale for primarily ERP software, as well as the need to leverage our numbers with stronger relationships with those ERP companies. Therefore, we have relationships with all of the major companies (Ellucian®, Oracle®, Jenzabar®, Anthology®, Workday®, and so on). We have cohort groups for our member institutions that work with those companies in order to improve services and pricing, and to find new ways of working more efficiently. Additionally, we have other partners that are actually GPOs, and we develop contracts with them for many different companies. Then of course, our HESS Collective program with Oracle and Drive Stream brings an affordable method for our institutions to get into a cloud-native secure environment like Oracle Cloud and OCI. This is a fairly new program that addresses the ongoing issues that we're all facing; more costs and more difficult processes. The goal is to create an affordable product and to keep our institutions’ ERP and SIS systems going.
However, is there a general trend of increasing software complexity, as well as increasing costs for students? Is this true, and is this part of why it makes sense for an institution to join your respective organizations?
KF (HESS): Yes, I would say absolutely. That's why we have our cohort groups of member institutions, to receive feedback and information from those groups and then to help the vendors improve the programs. By working together with various institutions that are implementing and using the software, one can say that they're not implementing the software solution by themselves. They're working together in cohorts to implement this software and sharing best practices around the platform.
What do you consider to be the greatest achievement of each of your organizations?
LK (ICE): Again, I think we provide significant cost savings, according to the presidents of my member schools. It enables them to focus on educating and keeping their student populations happy and satisfied. They don't have to worry about their ERP and student information systems, which could be a big drain.
KF (HESS): I would say ours is the successful camaraderie and collaboration among our CIOs and other technology professionals as a community. When there are issues, they're voiced. We have several different ways that our CIOs communicate through listservs and through a closed social network platform. So, there are discussions and then when there are major discussions, we go to the company together and we have them address the issues that are out there. So, I think that's the biggest success that HESS has had over the last 10 years; giving our members a larger voice in a very complicated, largely lucrative industry, if you will.
That's from the side of the institutions, right? But you interact with major vendors, as well. Have they learned something? I mean, have these vendors taken away valuable lessons to their organizations by working with you?
LK (ICE): I don't think so. We just show up like any other customer. We meet with them regularly just as they would if we were an individual school. But, in terms of how we run our shared environment versus how they may run their SaaS solution we've never really had any discussions about it.
KF (HESS): In terms of Hess, we have almost 400 member institutions. Sometimes we're a thorn in the side of those companies and sometimes we're partners. It all depends on the year and what's going on in the companies, but we definitely bring a larger voice to the table.
And ICE, we're glad that Larry's with us, ICE is an associational partner. We have other associational partners too, so that brings an even larger voice to those companies that our members use individually.
Can you give us specific examples of efficiencies generated by institutions working together?
LK (ICE): Well, each school may have one really talented person. Maybe they have a systems administrator who's also a good SQL DBA, right? So now seven schools running the infrastructure on their own, that would be seven really talented persons. We have one system admin, one SQL DBA, some business analysts, et cetera across the seven schools.
Also, small schools tend to have a lot of staffing turnover. So, we provide training. If you get a new CIO or a CFO or a new controller or somebody in the finance office, we can provide training to them because we have knowledgeable people on our staff. They don't have to go pay elsewhere to train them. So, our mere existence saves money; it's an economy of scale. Instead of everyone doing it themselves, they're sharing resources and that's where savings come in. There's some collaboration between the schools as well in other areas.
We have a strategic advisory council (SAC, as we call it) made up of the CFOs and CIOs of each school, which meets monthly. We also have our own listservs that we make available, and there's some collaboration going back and forth. Another thing we do, is hire an external consultant yearly to train and go over the changes in financial aid, which is obviously a very important part of recruiting and managing a school. It's valuable to have all the schools up to speed and knowledgeable on the changes in policies and whatnot. So, again, it's an economy of scale. Instead of one school having to go pay a consultant, this cost is divided among seven. We simply provide a mechanism to do cost savings for each of the schools, and additionally, we enable them to focus on educating students and not running IT.
Is your organization actively looking for more institutional members or more schools to join?
LK (ICE): Yes, we are looking for new members! We are looking to take on probably two, maybe three new members this year. We're not looking to be huge because the economy changes and at some point you have to add staff; it's a balance. We don't want to compete with, let’s say, Ellucian services and their cloud. Most of our schools are smaller schools that maybe want to have Colleague®, but on their own. They’re just too small and can't afford it; these software packages are quite expensive.
Would you say that the SIS and ERP are the most expensive, within the budget of any school, regardless of size?
LK (ICE): I wouldn't be in a position to speak for the budget of the member schools. However, these are significant numbers for sure.
KF (HESS): Yes, it's definitely the largest cost that I had over the years as a CIO in the IT budget. It ranks up there about fourth or fifth in the overall college budget as well.
In the case of HESS, are there specific topics that CTOs, CIOs, and CFOs are concerned about at the present?
KF (HESS): Absolutely. Our CIOs, CTOs, and other technology professionals are concerned about a lot of different things, specifically regarding audits, compliance, and data governance. Quite recently, the big topic has been the use of AI in their operations and how this would affect and/or apply to many of the current problems with admissions and retention. These are kind of top-of-mind issues. However, we’ve conducted wonderful research and we're in the process of doing more with Doctums® on how to apply this new AI technology to the problems and the challenges of private and nonprofit colleges and universities. So yes, the ongoing new developments in technology are always an issue. Also, Quantum computing, how that affects security and a lot of different things within the organization, has lots of conversations going on now as well.
This is a question for Keith. As a community of practice, what's the most engaging channel for them to interact with each other?
KF (HESS): We’re kind of unique in that process. We do have listservs and all kinds of webinars throughout the year; two or three webinars a month. We also have a national conference, which is a great collaboration space. But throughout the year, most of our discussion happens within our cohort groups and also on what we call the HESS-OLC, the online leadership community, which is a closed social network software. There's lots of collaboration going on between our institutions through that. They can share files, they can share graphics, they can share discussions in that space and have kind of a closed discussion about certain things, which is kind of innovative in terms of what we do with our members. I don’t know of any other organizations that use this software, but there’s lots of different ways that our institutions collaborate and communicate together.
LK (ICE): Keith keeps reminding me of things. Another piece of software we use is Entrinsik Informer® as a reporting platform. In the last couple of years, Informer® went through a major upgrade from version four to version five, which was almost like implementing a new system. So again, our economy of scale, one of our analysts who supports reporting held regular meetings with the reporting user group and went to these meetings. Oftentimes we'll get a query from one of the schools that wants to run some type of report, and the individual who manages that user group can share the stub report from a school that already did this process. That way, they don't have to start from scratch.
KF (HESS): We are doing some of that as well with our HESS Collective program with Oracle Cloud®. That group has 11 schools, and many more will soon join this year. However, this is a collaborative and ongoing design between the institutions where they're sharing a lot of information. They're sharing integrations between the institutions, as well as reports, workflows, automations, and all kinds of resources that they would have had to pay for individually historically. Basically, they're getting all those resources at no cost, which is a wonderful thing. Also, we have a great relationship with DriveStream® that will enable these schools to pool their support hours into a project that might cost one institution 200 hours shared between 10 or 20 schools it's much less.
LK (ICE): Again, Keith keeps reminding me of things. Some of the schools share a Title IX coordinator. One of our bigger schools in the consortium has a full-time CIO, and one of the smaller schools agreed to share their CIO. So, we are trying different things and the schools keep trying things as well in a collaborative manner. Their goal, ultimately, is to save money.
Is it easier to be a CTO or a CIO nowadays than 20 years ago? Or is it harder?
LK (ICE): I would argue that the CIOs of my member schools don’t have to worry about their biggest system, that's my concern. The schools focus on providing great student networks and other important things. Some of the real small schools, they sort of outsource their CIO role and they just have a consultant come in.
There is a common theme in our discussion: a shortage of staff or IT talent at certain schools. Why is that a challenge?
KF (HESS): My concern is a brain drain. As these schools begin to shrink and their pockets begin to get tighter and tighter, if they can't think outside the box and do their own thing, they're going to have to turn it over to someone who can. We’re going to see a brain drain as top CIOs and top technology people leave higher education and go into commercial work. It's going to hurt private colleges even more, and they're going to have to outsource.
Many of the institutions that are stronger and have a bigger vision will survive, but smaller institutions are going to have to look at ways to consolidate many of their operations. IT is one of them, especially the ERP operations.
That brings me to my final question, and it is licensing. I mean, in the context of the total cost of ownership, is licensing the biggest item? Above staffing? Above talent?
LK (ICE): I'm telling you; software licenses go up every year. They go up more than the salaries of my staff, I assure you. Everyone wants to squeeze the blood out of the turnip.
There's an obvious disconnect in the education space. I mean, it's not just money for making more money. There should be a balance there, right? And what I find interesting about the work you do is that it basically uses the same educational values, which is knowledge sharing, but with an operational purpose and an administrative purpose as well.
KF (HESS): Hess is a nonprofit, the Coalition is a nonprofit, ICE is a nonprofit. We don't see other nonprofit organizations that serve the same constituency as adversaries, we see them as partners.
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