Assembling the puzzle

Evangel University is in the middle of arguably it’s most challenging year to date. The nearly 60-year-old Springfield-based higher learning institution merged with Central Bible College and the Assemblies of God Theological Seminary in May 2013 – nearly three years after the Assemblies of God General Council gave the go-ahead – and now the heavy lifting begins.

The university will begin shuttering the declining CBC campus in January and will actively seek buyers interested in the school’s 108-acre parcel of land on North Grant Avenue. Evangel spokesman Paul Logsdon said all real estate proceeds would go toward paying off CBC’s more than $6 million debt load, but any surplus funds from that sale will be used to create an endowment fund for future ministry-based students at Evangel.

Beyond that endowment fund, the CBC legacy will continue in the consolidated university curriculum. Forty-three faculty and staff transitioned to Evangel in fall 2013 with the launch of the School of Theology and Church Ministries. Melding program aspects from all three entities, it is the first official school of study as Evangel moves from a department-based structure to a traditional university model – a long-term project with a target completion of 2020.

Logsdon said prior to the decision to consolidate, CBC experienced a protracted enrollment slide as the traditional Bible college model has fallen out of favor.

“Of the 17 or 18 Assemblies of God Universities around the country, CBC was the only one that couldn’t make the transition to a liberal arts university,” he said. “Because of proximity to Evangel, they weren’t really able to grow that much. So while CBC was losing students and deferring maintenance projects, we’ve been growing and renovating our residence halls.”

From 2000–10, as CBC’s enrollment fell by nearly 25 percent to 650, Evangel’s student body grew to more than 2,000 students and curricula were expanded to more than 100 undergraduate and master’s degree programs.

As a combined financial picture took shape, the total debt load topped $30 million and operational deficits existed in several areas. As a result, Evangel’s overall $38.7 million operating budget had to be reduced by 2.7 percent, or slightly more than $1 million.

Part of that adjustment came in the form of staff reductions that were announced Dec. 19. Across all three institutions, 12 staff positions were eliminated and six faculty contracts will not be renewed for the next school year. Additionally, seven current staff vacancies will remained unfilled, bringing the total number of affected positions to 25, or about 5.8 percent of total university positions.

Although she is a semester away from fully taking the reins of Evangel from retiring 40-year president Robert Spence, President-elect and CEO Carol Taylor is approaching the challenges of her position with an experienced eye. Taylor has mounted a similar turn-around before, at Costa Mesa, Calif.-based Vanguard University in 2009.

She enters the Evangel picture during a consolidation – approved by accrediting body North Central Association’s Higher Learning Commission in 2013 – which  mirrors the changing landscape of religious education.

According to Christian Standard magazine, which conducts an ongoing study of independent Christian colleges, total enrollment has risen more than 70 percent since 1987. And while there are fewer schools overall, the number of those institutions with more than 500 students has tripled.

Taylor contributed a chapter to the 2012 book, “Thriving in Leadership,” a collection of strategic essays on Christian higher education, in which she wrote about leading organizational turnarounds. She outlines a strategy hinging on a total commitment to transformation, while cautioning against underestimating the depth of any particular crisis.

“If you cannot face or define the reality of your situation, eventually another group will define it for you,” she wrote. “It may be your faculty and staff, donors, students, alumni, financial institution or accrediting body.”

Defining a new EU
Moving forward, Taylor has a clear vision for defining the future of the consolidated Evangel University, which includes the rigorous questioning of both old and new programs.

“Is there a need?” she said. “Can we meet the need in a unique way? Will it attract students who are passionate about pursuing that kind of a program?”

Both Logsdon and Taylor declined to comment on future program moves, but noted one such new program within the business department, funded by an anonymous alumnus, targets those seeking leadership careers in nonprofit organizations. It’s a unique curriculum that blends altruistic focus with business acumen, and was filled to capacity as soon as courses opened.

“Our perspective is that all students are called to serve,” Taylor said. “We need to be geared toward those with a head for business and a heart for service, helping them to find that place where their talents, inclinations and interests all line up in a way that allows them to really be of service to the world.”

Inclusive leadership is key to a successful integration, said Dr. Gary Weedman, president of Johnson University System, a 1,000-student school in Knoxville, Tenn. His institution is one semester into joint operations after a similar two-school merger earlier in 2013, and Weedman said it would be foolish to attempt any such consolidation without respecting the culture, ethos and history of each entity.

Just four years after transitioning and rebranding from a Bible college into a traditional university model, Johnson University was approached in May 2013 by the trustees of Florida Christian College, a 370-student school in Kissimee, Fla. Strictly due to financial reasons, Weedman said, the institution had lost its accreditation from the Southern Association of Colleges and Schools, and was in jeopardy of closing.

 “They were just digging the hole deeper and deeper every year,” he said. “They had debt that was killing them, with 6.5 percent interest on that loan, plus internal borrowing.” Weedman said Johnson University leaders did their due diligence and decided it was a good long-range proposition.

“We really looked at the finances carefully,” Weedman said. “They had record enrollment two years ago, and we have hard projections that it can be viable within two to three years. It really was a business decision, not just a wish. Our board wouldn’t have let us do it otherwise.”

In 2013, Johnson University made Forbes Magazine’s list of 100 financially fit higher institutions.

Long-term integration
While the business side of such an acquisition must be solid, leaders caution that attention to the soft aspects of the union are key to the long-range success when consolidating institutions.

Local health care executive Todd Schaible is leading a trifurcated merger within his organization, folding the educational The School of Professional Psychology at Forest Institute into Burrell Behavioral Health. The two entities were officially joined on Jan. 1 by Clarity Recovery and Wellness to form a comprehensive continuum of mental health services.

Though the industries differ, Burrell President Schaible approaches the melding of cultures with a similar respect. From annual events to operational strategies, to corporate culture and volume purchasing, each decision should be evaluated in broad context, he said.

“You have to look for ways and means that the whole can be greater than the sum of the parts, without lessening any of the parts,” he said. “Everybody brings something to the table, and you have to make sure you take advantage of those opportunities to make the whole greater.”

The Forest merger carried with it up to $2 million in assumed debt and a thin operating margin on its annual $7.2 million budget, according to Springfield Business Journal archives. Still, Burrell identified the value of anchoring Forest Institute’s graduating psychology professionals in the area to ensure adequate future staffing for area mental health programs.

Schaible said it’s important to recognize not just the ledger balances, but the intrinsic value that individuals place on their company.

“Too many times, Company A sees something of value in Company B,” he said. “And so A merges with B to get that value. But in the process of merging, they try to make Company B fit in by making it more like Company A, and they destroy the value that they set out to gain.”[[In-content Ad]]