Despite an early goal by new Chicago Booth Dean Sunil Kumar to significantly strengthen the school’s alumni network, Booth is now reporting that its overall alumni participation rate of annual giving fell slightly last year to 16.8%.
The school, in its just published 2011-2012 annual report, did not disclose the previous rate of giving which Poets&Quants had earlier estimated at 18% (see “Best B-School Alumni Networks.”) But the decline in what had already been one of the lowest participation rates of giving for any of the elite business schools came as something of a surprise.
The leader in this category, thought to be a long-term satisfaction index with the school, has been Dartmouth College’s Tuck School of Business, where participation topped 70% for the first time last year. That is more than four times the rate of giving at Chicago Booth.
BOOTH GIVING RATES WELL BELOW OTHER LEADING BUSINESS SCHOOLS
The participation rate, also considered a sign of the alumni network’s loyalty to the school and its willingness to help current students, is also well below other leaders in this area such as Yale’s School of Management (roughly 46%), the University of Virginia’s Darden School (roughly 43%), and Stanford Graduate School of Business (41%). Harvard Business School recently disclosed that its participation rate in its last fiscal year was 27%, and the average for a top 20 school is approximately 20%.
Chicago Booth has been aware of this issue because soon after arriving in early 2011 Dean Kumar pulled together a committee to study how it could strengthen the alumni network (see “Chicago’s New Dean Pursues Globalization and Stronger Alumni Network.”) According to the annual report, the committee recommended increasing “the sense of purpose and community alumni feel by providing more opportunities to volunteer, network with other alumni, and hear from faculty.”
The committee also urged the school to “engage students early in their Booth careers by giving them glimpses into the benefits of being a Booth alumnus; to make reunions more robust and rewarding experiences and to hire a senior director whose sole responsibility will be alumni engagement.”
Despite the lower participation rate, the school said its annual fund set a new record with $5,354,755 raised in the last fiscal year. “Our goal is to make our fundraising efforts more sustainable by increasing the rate of participation,” the annual report said.
In his annual report letter, Dean Kumar said that the school is updating its database for alumni by using “public sources, such as LinkedIn, to improve our communication and provide more opportunities to stay connected. This summer we launched the first phase of our website upgrade and soon will roll out significant enhancements for alumni. The committee also recommended best practices to help alumni stay connected and promote the school, and we are encouraging alumni to adopt these.”
SCHOOL HIRING MORE ADJUNCT AND ‘CLINICAL’ TEACHERS
The school also reported that it has added proportionally more adjunct and “clinical” teachers to its faculty over tenure and tenure-track positions. While adjuncts have risen by nearly 28% to 37 in 2011-2012, from 29 in 2008-2009, tenure and tenure-track faculty have increased only 1.6% to 130 from 128 over the same period. “Clinical” teachers, generally those with business experience, have risen by nearly 27% to 19 in 2011-2012 from 15 in 2008-2009.
BUDGET SURPLUS HIT A RECORD $14 MILLION LAST YEAR
The trend appears to be more of a strategic decision rather than a reflection of the school’s financial position. Booth reported that its net operating surplus—the amount of money it has in excess of its expenses—rose to $14 million last year, up from $12 million a year earlier and just $5 million in the academic year 2008-2009. And the school’s total revenues increased 2% to $211 million last year, up from $207 million the year before.