ALUMNI GIVING
UV6394 Rev. Sept. 22, 2014
This case was prepared by Phillip E. Pfeifer, Richard S. Reynolds Professor of Business Administration. It was written as a basis for class discussion rather than to illustrate effective or ineffective handling of an administrative situation. It should not be used as a source of primary research. Although the characters and situation are fictional, the data are not. Copyright 2012 by the University of Virginia Darden School Foundation, Charlottesville, VA. All rights reserved. To order copies, send an e-mail to sales@dardenbusinesspublishing.com. No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means—electronic, mechanical, photocopying, recording, or otherwise—without the permission of the Darden School.
ALUMNI GIVING
Madison Kryswada had been director of alumni relationships at State University for two years before she shared her frustrations about alumni giving with her staff. Kryswada’s team was responsible for all aspects of alumni relationships at State University, but the only thing the president’s office seemed to care about was money.
“Not only is there extra pressure to increase total giving now that state support has been
cut back,” she lamented, “but we are also pressured to increase the percentage of alumni who give (in any period).” Kryswada continued:
This new metric is called average alumni giving rate by U.S. News & World Report, and it constitutes 5% of the overall rating the publication gives to colleges and universities. In today’s competitive market for students, those ratings, as flawed as they are, are tremendously important. The average alumni giving rate is used as a measure of student satisfaction, and our 8% rate is in the low category. Analysis done by folks in the president’s office suggest that raising it is one of the easier ways to improve our overall #132 U.S. News ranking in the National Universities category. Not that I’m looking for excuses, but it always seemed to me that 8% was a very reasonable rate for a school like ours. We are not a small liberal-arts college that can cater to its students. We are a large public university that serves students from a wide variety of backgrounds. Although we do have a first-rate football team, our campus life is not, shall we say, as “memorable” as some of the football- powerhouse schools in the South. Our faculty members do a lot of research, and classes tend to be large and are often taught by graduate students. A substantial percentage of our students commute. All of this suggests to me that convincing 8% of alums to give something to good old State University in any year is actually something to be proud of. Or, excuse me, something of which we should be proud.
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Alumni Giving Rate Data
To investigate further, Kryswada asked her assistant to assemble data on class sizes, graduation rates, and, most important, alumni giving rates for a selection of peer schools. Rather than spend a lot of energy defining the set of peer schools, Kryswada suggested using the list of U.S. schools that fielded football teams in the Football Bowl Subdivision (the highest competitive division for U.S. college football). Within a day, the assistant (with the help of a $34.99 subscription to premier content on the U.S. News & World Report website), assembled relevant data on 123 U.S. schools. Exhibit 1 describes the variables in the database, Exhibit 2 shows the first and last three entities in the database, and Exhibit 3 provides summary statistics for each of the six variables. The Research Questions
Kryswada was eager to learn what these data could tell her. As she saw it, this was an opportunity to uncover “the drivers of alumni giving rate.” To help her assistant take the next steps, Kryswada compiled a list of very specific questions:
1. School A’s graduation rate is 10 points higher than school B’s. How much higher do we
expect A’s giving rate to be? 2. How does the answer to question 1 change if we learn that A and B have identical
student-to-faculty ratios? 3. Which of the 123 schools has the most (least) impressive giving rate? 4. Consider a school similar to ours. We have a 67% graduation rate and a student–faculty
ratio of 17:1, 34% of the classes have fewer than 20 students, 23% of the classes have more than 50 students, and we have a freshman retention rate of 77%. Should this school’s giving rate be greater than or less than 8%? “We’ll meet first thing in the morning,” Kryswada told her assistant. “You can give me
the answers, and we’ll take it from there. You find this exciting, right?”
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Exhibit 1 ALUMNI GIVING
Descriptions of Variables
Variable Description ID An identifier running from 1 to 123 (schools are listed in alphabetical order)
School Name of the school SFR Student-to-faculty ratio LT20 Percentage of classes with fewer than 20 students GT50 Percentage of classes with greater than 50 students GRAD Average six-year graduation rate FRR Freshman retention rate
GIVE Average alumni giving rate Source: Created by case writer.
Exhibit 2 ALUMNI GIVING
Alumni Giving Database
ID School SFR LT20 GT50 GRAD FRR GIVE 1 Arizona State University 24 42% 16% 59% 81% 8% 2 Arkansas State University 19 49% 4% 37% 69% 11% 3 Auburn University 18 24% 17% 66% 87% 31% . . . . . . . . . . . . . . . .
121 West Virginia University 23 32% 19% 59% 80% 12% 122 Western Kentucky University 19 43% 6% 49% 73% 13% 123 Western Michigan University 19 36% 11% 52% 74% 10%
Data source: U.S. News & World Report, 2010 survey data, http://premium.usnews.com/best-colleges (accessed May 22, 2012).
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Exhibit 3 ALUMNI GIVING Summary Statistics
Source: Created by the case writer using StatTools, a statistics toolkit from the Palisade Corporation.
StatTools Report Analysis: One Variable Summary
Performed By: Pfeifer, Phil Date: Thursday, April 17, 2014
Updating: Live
SFR LT20 GT50 GRAD FRR GIVE One Variable Summary Alumni Giving Data Alumni Giving Data Alumni Giving Data Alumni Giving Data Alumni Giving Data Alumni Giving Data Mean 17.772 0.4037 0.13628 0.6452 0.84114 0.14179 Variance 20.407 0.0179 0.00361 0.0288 0.00705 0.00651 Std. Dev. 4.517 0.1339 0.06006 0.1698 0.08394 0.08067 Skewness ‐0.3623 1.1068 ‐0.0129 ‐0.0459 ‐0.2427 1.1040 Median 18.000 0.3800 0.13000 0.6400 0.84000 0.13000 Mode 19.000 0.3400 0.16000 0.8000 0.97000 0.13000 Minimum 6.000 0.1400 0.00000 0.2600 0.58000 0.02000 Maximum 31.000 0.9500 0.31000 0.9600 0.98000 0.41000 Count 123 123 123 123 123 123
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