A Pivotal Moment: A Message for Faculty and Staff at the Start of the New Semester
As we begin this semester, we must recall our path to this moment, which includes
our strategic plan and the Magis Operational Excellence program. I know many of us are feeling a wide array of emotions regarding the organizational
and financial decisions that face us. Members of the President’s Advisory Council,
President’s Coordinating Council, and Deans have continued to apprise me of your unease,
questions, and concerns.
Here are the important points I hope you receive from this message.
- SLU values you, our people. Even as technology changes, the work done here requires
intelligent, compassionate, and driven individuals like you.
- Difficult decisions affecting the SLU community will be made in the coming months
and over the next few years. We fully understand these decisions will affect your
- This is a pivotal moment in the history of our university. The direction we turn,
depends on all of us.
- When we look at the many challenges in our world, nation, and region it is apparent
that the type of Jesuit education and compassionate health care we provide has never
been more important, relevant, or needed.
Driven by our common purpose, our aspirations for our community, and our Jesuit values,
we have dedicated ourselves to building a culture of collaboration and trust. We remain
united by a shared calling to serve, especially our students and patients, and to
advance various fields of study that improve our world during times that test our
In August 2014, we embarked on a collaborative strategic planning process. Through
it, we expressed a shared ambition to be operationally excellent and financially stable.
We also identified a series of broad initiatives that will define SLU as it moves
into its third century of providing a distinctive, Jesuit education.
Despite our history as an innovative leader in academics, in health and medicine,
and in our community, challenges remain. In our many planning sessions, you identified
several longtime institutional barriers to the transformative change we imagined.
- Administrative processes are too complex.
- Approvals are too burdensome.
- Levels of service are inconsistent.
- Budgeting lacks accountability.
- Students have insufficient time with some of our finest faculty.
Further, our ability to implement the strategic plan has been constrained by the University’s
negative operating margin. Auditors confirmed SLU closed the last fiscal year (ending
June 2016) with an operating loss of $16.7 million
Combine these factors with the changing landscape of higher education, and we have
operational and financial performance that is simply unsustainable. As stewards of
this nearly 200-year old mission, we have a responsibility to transform the university
in ways that assure its long-term impact and history of excellence.
In my March 2016 memo, I shared, “Despite these forces, we remain committed to keeping
a SLU education within reach for qualified students. We will continue to increase
financial aid and maintain need-blind admission policies that assist in enrolling
low-income students, academically talented students, veterans, and first-generation
Rather than yield to the challenges facing our University, we launched the multi-year
Magis Operational Excellence program. It was designed to identify opportunities for cost
savings, revenue growth, and improvements in operational effectiveness at every level.
Another reason for this undertaking is the recognition that continuing excellence
and achieving our high aspirations depends on our ability to fairly reward our faculty
and staff. Future surpluses will address our strategic priorities. As previously communicated,
“We plan to devote at least 20 percent of the positive net results realized by the
multi-year Magis Operational Excellence program to bringing our compensation practices in line with
our strategic plan” (March 2016 memo).
This complex undertaking required an external consulting firm. So after a difficult
deliberation and rigorous interview process, we selected Bain & Company, who provided
us with a comprehensive set of facts and comparisons to assist with the design work
Initiative Teams. While I await recommendations from Co-sponsors Provost Brickhouse
and CFO Heimburger, I am also seeking advice and information from other administrators,
faculty leaders, and staff.
To be clear, our University leadership will make the decisions, and all changes will
be considered in a manner consistent with our mission, values, and culture.
A regrettable part of the operational review will be the reduction in the number of
people employed by the University. This is painful for any organization but it is
particularly so for us, a place where community is strong, dignity of person is valued,
and our common purpose is the framework for success.
We do not yet know the exact number of reductions, but we do know they will impact
every operational and academic unit. Decisions will be guided by data and made after
careful thought and discussion. We remain committed to following our practices of
shared governance during deliberations affecting academics, and I encourage faculty
to connect with their deans and members of the Faculty Senate with questions and suggestions.
We will do all we can to support those transitioning to employment elsewhere. Special
considerations for tuition remission are being developed for current and future SLU
students who are children of parting employees. Qualified employees with a history
of good job performance will be given hiring preference in future years. Details are
still under development but will be made available prior to any notification of job
I know this situation generates angst and anxiety. It is legitimate to feel stress
about how the Magis Operational Effectiveness program may affect your family, your future, and your role
here at SLU. It is our hope that frequent communication and continued transparency,
which includes sharing the timeline for separations as it is known, will aid in releasing
some of the tension you rightfully hold. I understand that in the meantime, if other
opportunities arise, you have to do what is best for you and your family.
As we move through reductions we will simultaneously focus on growth. I am in the
midst of creating a group of academic and other leaders to recommend programs and
opportunities that are in line with our strategic plan and likely to add new net revenue
and raise our national prominence. I will be sending another communication that describes
this effort later in the term.
I realize that you work hard and make sacrifices to advance SLU. I have observed many
of the ways in which you have ensured that the experiences of our students and patients
are the first priority. I hear many stories of how you go above and beyond to help
I want to thank each of you, particularly the hundreds of faculty, staff, and students
who spent thousands of hours working together over the past few years to create a
vision for SLU, assessing our strengths, identifying our weaknesses and envisioning
So what must SLU do now?
We must face the challenging decisions before us. We must improve our financial situation
in order to have the resources necessary to fund our plan and better compensate our
people. We must reassess our overly complex and burdensome processes, flatten organizational
layers, and fix inefficiencies. We must break down walls and achieve the many benefits
of creative collaboration. We must identify areas for focus and growth and vigorously
pursue them. We must become more of the SLU we all want to be and in so doing, reach
new heights as a premier, Jesuit research university.
You are all dedicated professionals. I know that through this process you will keep
doing your best work, advancing the frontiers of knowledge, educating and supporting
our students, and treating our patients, in the spirit of our Catholic and Jesuit
values. That is what makes SLU the special place it has always been and always will
Fred P. Pestello, Ph.D.