Business and Operations//
March 22, 2020
As we find ourselves in the COVID-19 pandemic, the Business Officer has a crucial role in helping his or her school weather this storm.
In an unprecedented move, most independent schools made decisions to close their buildings while moving to remote learning. International schools, ahead of the US by a few weeks, have been sharing their experiences. The whole world of education (secondary and universities) has stepped into remote classrooms. Throughout this radical change, trust, excellent leadership, and proactive communication will be required to demonstrate stability.
What We Know Today
- Schools have closed their buildings, and most have transitioned to remote, web-based classrooms.
- Parents are inquiring about refunding tuition.
- Schools are grappling with decisions about paying employees, vendors, etc.
- School leaders are understandably nervous about financial stability.
Why Closing Buildings Is Necessary
COVID-19 is a brand-new virus, and no person in the world has developed any immunity to it. This fact is the single most important one to understand and explain to constituents.
Additionally, COVID-19 is thought to be much more deadly than the regular flu. Putting these two pieces of information together is a data-driven approach for explaining the school’s decisions. The Business Manager is in a unique and influential position to help everyone understand this data.
A Crisis With the Power to Grow Exponentially
At the beginning of a pandemic, growth is small and slow. But infections increase daily, and eventually, they double every three to six days. When you get into the millions, and those numbers double every few days, the enormity of the problem becomes crystal clear.
This is a frightening reality but we can lessen the number of infections by reducing human-to-human interactions. That’s why we must embrace social distancing.
As we decrease the frequency of interactions, two things happen:
- We decrease the number of infections, thus reducing the number of deaths.
- We decrease our load on the healthcare system (If we overpower the healthcare networks, we enter into a period where doctors have to decide whom to treat and whom to allow to die).
Therefore, to proactively manage the crisis, ISM makes the following recommendations for Business Officers.
Recommendation #1: Be Well-Informed
The Business Manager is in a unique position to understand the data around this crisis and will be vital in communicating that information to parents, faculty, and staff. The Business Manager also influences decisions. Helping the School Head and the Board understand your school’s unique position will be required. Therefore, the Business Manager must be well-read and informed during this outbreak.
Recommendation #2: Create a Tuition Strategy
Schools should not feel obligated to refund prepaid tuition, nor should they forgo collecting tuition throughout the remainder of the year—as long as they are proactively developing and implementing remote learning. While school buildings are closed, learning has not stopped. If the school charges extra fees for programs and services such as athletics, clubs, food, etc., those fees should be refunded. However, if your tuition is all-inclusive, refunding is neither required nor recommended.
Recommendation #3: Maintain Current Salaries
As much as possible, maintain the current salaries and hourly wages paid to all employees, even if they’re at home. COVID-19 is a worldwide crisis. Everyone has to continue to pay their living expenses and feed their families. Although a school may have no legal obligation to pay workers when buildings are closed, there remains a social responsibility to support team members.
Recommendation #4: Set Board Expectations
If your school has cash reserves, discuss the possibility of accessing these funds with your Board. If you’re able to do so, consider calling a virtual Board meeting to share your thoughts so everyone is on the same page. This requires looking at your current by-laws and making certain that a virtual Board meeting is allowed. You should also understand how much notice is required before you can hold an official meeting. Your Board can also approve the Finance Committee to authorize the Business Manager to spend reserves up to a fixed dollar amount (consider $100,000) to manage COVID-19. In that scenario, If the need is greater than $100K, approval of the full Board would be required.
Recommendation #5: Be Flexible
Business Managers must understand that this is a worldwide emergency. The normal rules no longer apply. Everything may not fit into the normal budget “buckets.” Flexibility and accommodation will be critical for the remainder of this school year. Prepare the Board and the Finance Committee for these changed circumstances, and make certain that your Head and teachers also appreciate this new reality.
Recommendation #6: Only Allow Essential Employees on Campus
Determine your school’s essential functions, and judge whether those functions can be accomplished remotely. Allow people to be at the school only if their presence is essential. This will ensure all faculty, most support staff, all cafeteria staff, and most facility staff stay home, unless specifically requested. The current advice is to avoid groups of greater than 10.
COVID-19 is a worldwide pandemic. Indeed, much will be learned by this event, and many business models will change. This will require flexibility, and it will almost certainly cost money. Wise Business Managers will help their schools ask questions, make grounded decisions, and adapt.
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