What Happens when Public Universities are Run by Robber Barons

Strategic Mumblespeak -
Er, UVA's Teresa Sullivan was fired for what?

by Siva Vaidhyanathan

Slate.com
June 15, 2012

http://www.slate.com/articles/news_and_politics/hey_wait_a_minute/2012/06/teresa_sullivan_fired_from_uva_what_happens_when_universities_are_run_by_robber_barons_.html

In the 19th century, robber barons started their own private
universities when they were not satisfied with those already
available. But Leland Stanford never assumed his university
should be run like his railroad empire. Andrew Carnegie did
not design his institute in Pittsburgh to resemble his steel
company. The University of Chicago, John D. Rockefeller's
dream come true, assumed neither his stern Baptist values nor
his monopolistic strategies. That's because for all their
faults, Stanford, Carnegie, and Rockefeller knew what they
didn't know.

In the 21st century, robber barons try to usurp control of
established public universities to impose their will via
comical management jargon and massive application of ego and
hubris. At least that's what's been happening at one of the
oldest public universities in the United States - Thomas
Jefferson's dream come true, the University of Virginia.

On Thursday night, a hedge fund billionaire, self-styled
intellectual, "radical moderate," philanthropist, former
Goldman Sachs partner, and general bon vivant named Peter
Kiernan resigned abruptly from the foundation board of the
Darden School of Business at the University of Virginia. He
had embarrassed himself by writing an email claiming to have
engineered the dismissal of the university president, Teresa
Sullivan, ousted by a surprise vote a few days earlier.

The events at UVA raise important questions about the future
of higher education, the soul of the academic project, and the
way we fund important public services.

Kiernan, who earned his MBA at Darden and sent his children to
the university, has been a longtime and generous supporter of
both the business school and the College of Arts and Sciences,
where I work as a professor. Earlier this year he published a
book called - I am not making this up - Becoming China's
Bitch. It purports to guide America through its thorniest
problems, from incarceration to education to foreign policy.
The spectacle of a rich man telling us how to fix our country
was irresistible to the New York Times, which ran a glowing
profile of Kiernan and his book on Feb. 29.

At some point in recent American history, we started assuming
that if people are rich enough, they must be experts in all
things. That's why we trust Mark Zuckerberg to save Newark
schools and Bill Gates to rid the world of malaria. Expertise
is so 20th century.

Kiernan played a strange and as-yet-unclear role in the
ousting of Sullivan over last weekend. Here is the story of
how it unfolded and how we came to know of Kiernan's role in
the matter.

Sunday morning my phones started ringing and my email box
started swelling. The rector (what we in Virginia call the
chairperson) of the University of Virginia Board of Visitors
(what most states call a Board of Regents) had written an
email to the entire university community announcing that
Sullivan had resigned.

I can't begin to describe the level of shock this generated
among alumni, students, and faculty. Suffice it to say that
everyone - every dean, every professor, every student, and
every staff member at the university - was surprised. Even
Sullivan did not have a clue that this was coming down until
the Friday before the Sunday announcement. I can describe two
things: the affection and respect that the university
community had for president Sullivan in her two short years in
office; and the bizarre turn of events that led to her forced
resignation.

Sullivan is an esteemed sociologist who specialized in class
dynamics and the role of debt in society. The author or co-
author of six books, she spent most of her career rising
through the ranks at the University of Texas, where she served
as dean of the graduate school while I was working toward my
Ph.D. in the late 1990s. She was known around Texas as a
straightforward, competent, and gregarious leader. She carried
that reputation from Texas to the University of Michigan, the
premier public research university in the world, where she
served as the chief academic officer, or provost, for four
years.

When the University of Virginia sought a president to lift it
from the ranks of an outstanding undergraduate school to a
research powerhouse, while retaining its commitment to
students and the enlightenment Jeffersonian traditions on
which it was founded, the board selected Sullivan in 2010. She
became the first woman to serve as president of UVA, a place
she could not have attended as an undergraduate in the 1960s
because it was all-male at the time.

The first year of Sullivan's tenure involved hiring her own
staff, provost, and administrative vice president. In her
second year she had her team and set about reforming and
streamlining the budget system, a process that promised to
save money and clarify how money flows from one part of the
university to another. This was her top priority. It was also
the Board of Visitor's top priority - at least at the time she
was hired. Sullivan was rare among university presidents in
that she managed to get every segment of the diverse community
and varied stakeholders to buy in to her vision and plan.
Everyone bought in, that is, except for a handful of very,
very rich people, some of whom happen to be political
appointees to the Board of Visitors.

We know from the email Kiernan inadvertently (stupid "reply
all" button!) sent to a large group of Darden School
supporters that he had plotted to convince many members of the
board that Sullivan should go. The Sunday we all found out
Sullivan had been forced out, Kiernan wrote in the email,
"Several weeks ago I was contacted by two important Virginia
alums about working with [Board rector] Helen Dragas on this
project, particularly from the standpoint of the search
process and the strategic dynamism effort." Kiernan assured
his readers that Sullivan was a very nice person whom he
respected. And he reassured them that sharp, trustworthy
people were handling the transition process: "And you should
be comforted by the fact that both the Rector and Vice Rector,
Helen Dragas and Mark Kington are Darden alums," Kiernan
wrote. "Trust me, Helen has things well in hand."

In her initial letter to the university community and again in
a statement later that Sunday, Dragas declined to offer any
reason for dismissing Sullivan. One thing we have learned from
watching universities in the past year is this: When a
university president fails to report a pedophile football
coach, it's a good reason to fire him. But no one, including
Dragas has ever even suggested that Sullivan had failed the
university financially, ethically, or morally.

"The Board believes that in the rapidly changing and highly
pressurized external environment in both health care and in
academia, the University needs to remain at the forefront of
change," Dragas wrote in her initial email announcement. I
have no idea what that means or why it pertains to Sullivan's
dismissal. I guess it means that stuff is changing. So the
university must change. Firing a president is change.

On Monday Dragas, sensing that the university community might
want some explanation for such a radical act, sent out a
second message: "The Board believes this environment calls for
a much faster pace of change in administrative structure, in
governance, in financial resource development and in resource
prioritization and allocation. We do not believe we can even
maintain our current standard under a model of incremental,
marginal change. The world is simply moving too fast."

OK, then. It's all about pace. I suppose this means the board
will appoint a new president every two years. Or maybe more
frequently, because that's the only way to keep up with the
pace of change.

Earlier in the statement Dragas wrote that "the board feels
strongly and overwhelmingly that we need bold and proactive
leadership on tackling the difficult issues that we face." So
we can derive from Dragas' statements that Sullivan was not
bold enough, fast enough, or "proactive" enough to guide a
bucolic 193-year-old institution founded by a stocking-wearing
guy who studied Greek and Latin for fun.

We were all baffled. So Sullivan did nothing wrong? The board
would not even hint at the reason she was fired. Conspiracy
theories quickly circulated to fill the vacuum. And they got
worse after Kiernan's letter unleashed an unfounded fear that
an MBA "cabal" was in cahoots with Goldman Sachs to loot the
university.

In a live appearance at the Rotunda, the central icon of the
university, Dragas did say, "We had a philosophical difference
about the vision of the future of the university." So what
were those differences? She wont say.

Fortunately, Kiernan's email, leaked to newspapers on the
following Tuesday, contained some clues. "The decision of the
Board Of Visitors to move in another direction stems from
their concern that the governance of the University was not
sufficiently tuned to the dramatic changes we all face:
funding, Internet, technology advances, the new economic
model. These are matters for strategic dynamism rather than
strategic planning." Wait. What? "Strategic dynamism?" That
struck many around the university as "strategic neologism."
Kiernan used the phrase two more times in his short email to
supporters.

Laughter ensued. It's the catch-phrase of the year at the
University of Virginia.

I have spent the past five years immersed in corporate new-age
management talk. For my recent book, The Googlization of
Everything - and Why We Should Worry, I immersed myself in the
rhetoric of Silicon Valley and the finance culture that
supports it. I subjected myself to reading such buzzword-
dependent publications as Fast Company. So I had heard about
"strategic dynamism" before. I can't say that I understand it
fully. But if my university is going to be governed by a
mysterious buzzphrase, I had better try.

Strategic dynamism, or, as it is more commonly called,
"strategic dynamics," seems to be a method of continually
altering one's short-term targets and resource allocation
depending on relative changes in environment, the costs of
inputs, and the price you can charge for outputs. In
management it means using dynamic graphs to track goals and
outcomes over time, and having the ways and the will to shift
resources to satisfy general goals via many consecutive short-
term targets. Most management textbooks offer equations one
may use to dynamically chart and execute strategy. And for all
I know it makes a lot of sense.

Consider sailing, which one might do if one is a hedge fund
billionaire from Connecticut. In sailing one sets a general
course to a distant target but tacks and shifts depending on
the particular environmental changes. I understand why
"dynamic" is better than "static." Who wants a static
sailboat? But is a university, teeming with research, young
people, ideas, arguments, poems, preachers, and way too much
Adderall ever in danger of being static?

The inappropriateness of applying concepts designed for firms
and sailboats to a massive and contemplative institution as a
university should be clear to anyone who does not run a hedge
fund or make too much money. To execute anything like
strategic dynamism, one must be able to order people to do
things, make quick decisions from the top down, and have a
constant view of a wide array of variables. It helps if you
understand what counts as an input and an output. Universities
have multiple inputs and uncountable and unpredictable
outputs. And that's how we like them.

Still, this cultish diction seems to have swayed at least a
few people on the Board of Visitors. It helped convinced them
that Sullivan was either not strategic enough or dynamic
enough or both. Almost a week after the event and in the face
of harsh and universal condemnation, the board itself remains
silent about its specific disagreements with Sullivan. The
Kiernan letter is the only text that guides us.

We on the faculty, joined by thousands of students and alumni,
have been asking the board for two simple things. Would it
please tell us the specific issues on which it disagreed with
Sullivan? And would it please tell us what sort of person it
thinks should be president of the university...and for how
long?

Both the Kiernan letter and Dragas' shallow statements discuss
the climate facing the university and all public universities
in the United States. The problem is, everyone seems to
discuss the fact that universities have too little money as if
it actually were a matter of climate.

It's not. It's a matter of politics. States have been making
policy decisions for 20 years, accelerating remarkably since
the 2007 recession, to cut funding severely, shifting the
costs to students and the federal government. Adjusted for
inflation, state support for each full-time public-college
student declined by 26.1 percent from 1990 to 2010. Meanwhile,
faculty and staff salaries have been plummeting and security
evaporating. This is especially true at the University of
Virginia, where state support per student is far lower than at
comparable state universities such as North Carolina.

So as tuition peaks and federal support dries up, the only
stream still flowing is philanthropy. Our addiction to
philanthropy carries great costs as well as benefits to public
higher education in America. We are hooked on it because we
have no choice. Either we beg people for favors or our
research grinds to a halt and we charge students even more. I
am complicit in this. I enthusiastically help raise money for
the university. And my salary is subsidized by a generous
endowment from board member Tim Robertson, son of the Rev. Pat
Robertson.

The reason folks such as Dragas and Kiernan get to call the
shots at major universities is that they write huge, tax-
deductable checks to them. They buy influence and we subsidize
their purchases. So too often an institution that is supposed
to set its priorities based on the needs of a state or the
needs of the planet instead alters its profile and curriculum
to reflect the whims of the wealthy. Fortunately this does not
happen often, and the vast majority of donors simply want to
give back to the institutions that gave them so much. They ask
nothing in return and admire the work we do. But it happens
often enough to significantly undermine any sense of
democratic accountability for public institutions.

The biggest challenge facing higher education is market-based
myopia. Wealthy board members, echoing the politicians who
appointed them (after massive campaign donations) too often
believe that universities should be run like businesses,
despite the poor record of most actual businesses in human
history.

Universities do not have "business models." They have
complementary missions of teaching, research, and public
service. Yet such leaders think of universities as a
collection of market transactions, instead of a dynamic (I
said it) tapestry of creativity, experimentation, rigorous
thought, preservation, recreation, vision, critical debate,
contemplative spaces, powerful information sources, invention,
and immeasurable human capital.

[Siva Vaidhyanathan is the Robertson Professor of Media
Studies at the University of Virginia. He also teaches in the
School of Law, and is the author of The Googlization of
Everything and Why We Should Worry.]

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