Don't take graduation rates and student earnings at face value when assessing university performance, finds Bain & Co. analysis

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May 21, 2024, 09:10 ET

Bain analyzes more than 900 US higher ed institutions; finds graduation rates can be misleading, data can help institutions learn from schools that outperform

BOSTON, May 21, 2024 /PRNewswire/ -- Graduation rates and student earnings data are not enough to assess the performance of higher education institutions, according to new research released today by Bain & Company.

During its analysis of more than 900 US higher ed institutions, Bain found that differences in student body mix such as underlying readiness for college and cost of living, as well as geographic location, can mask which institutions excel in terms of student outcomes.

"More than a third of college students fail to graduate within six years of enrolling and many don't see the growth in their income necessary to provide a strong return on investment," said Jeff Denneen, global head of Bain's Higher Education practice. "Colleges and universities need to change track and focus on the interventions that matter most to delivering better student outcomes. Our research identifies four areas higher education leaders should focus on if they wish to provide the most value to students. For example, universities can leverage advanced analytics to avoid students slipping through the cracks due to their socio-economic circumstances. By helping all their students succeed, universities can create a virtuous cycle of differentiation and increased demand."

Predicting student outcomes
As part of its analysis, Bain built a tool that assesses student outcomes and performance of public and private four-year institutions while controlling for student body characteristics and socio-economic factors. Many institutions outperform expectations that are often impacted by factors, such as family income and education history, academic preparation, full or part-time status, or racial, ethnic, and gender demographics. There is a strong relationship between actual and predicted outcomes, Bain found.

"The media, policymakers, and general public are starting to talk much more about outcomes than student debt and tuition, but most reports aren't considering the full story," said Mark Krafft, Bain partner and member of Bain's Higher Education practice. "Many colleges and universities aren't getting enough credit for the outcomes that they support their students to achieve because they are working with student bodies or in geographies with historically lower graduation rates and career outcomes. People talk about the impressive graduation rates and starting salaries from the top ranked universities while most of those students were destined to succeed regardless of the institution. Our analysis allows us to tease that apart so that we can better understand who is helping students succeed the most."

Four areas for success
Four critical areas that higher ed leaders should prioritize if they wish to improve student outcomes according to Bain include:

Make student outcomes leadership's top priority: Announce publicly that student outcomes are the top institutional priority, and shift time, attention, and resources accordingly. Boosting student outcomes requires sustained support from an institution's board and senior leadership.
Address systemic barriers to student success: Map the student journey from admission to graduation to tackle barriers preventing students from succeeding. These can include internal barriers such as complex course registration or degree requirements, and external barriers such as financial need, mental health challenges, and family obligations.
Implement a strong career-connected learning strategy: Prepare students for successful careers and lives through a combination of classroom learning and real-world experiences. Partner with employers to determine the skills and experiences they value most.
Employ data to set targets and inform the approach: Use data to understand institution- and department-level student outcomes and set realistic improvement targets.

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About Bain & Company

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Across 65 cities in 40 countries, we work alongside our clients as one team with a shared ambition to achieve extraordinary results, outperform the competition, and redefine industries. We complement our tailored, integrated expertise with a vibrant ecosystem of digital innovators to deliver better, faster, and more enduring outcomes. Our 10-year commitment to invest more than $1 billion in pro bono services brings our talent, expertise, and insight to organizations tackling today's urgent challenges in education, racial equity, social justice, economic development, and the environment. We earned a platinum rating from EcoVadis, the leading platform for environmental, social, and ethical performance ratings for global supply chains, putting us in the top 1% of all companies. Since our founding in 1973, we have measured our success by the success of our clients, and we proudly maintain the highest level of client advocacy in the industry.

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