ISM Stability Marker No. 1 Revisited: Cash Reserves, Debt, and Endowment

Vol. 42 No. 16

Cash reserves, coupled with low debt/no debt and endowment, have always ranked either first or second among the ISM Stability Markers. These indicators of institutional sustainability, in widespread use now for more than two decades, serve as fundamental points of departure in all private school leadership-level strategic conversations and plans. ISM suggests that you, as Board President, Finance Chair, School Head, or Business Manager, as a matter of basic organizational discipline, monitor the status of the three components in ISM Stability Marker No. 1.

Summary and New Dimensions in Our Measure of Well-Being on Executive Leadership

Vol. 42 No. 16

Over the past year, ISM studied the interrelationships among executive leadership, well-being, and school performance. In the previous three articles in this series, we have confirmed:

  • ISM’s existing measure of executive leadership and the Head’s level of flourishing correlate with key school performance variables (school stability, financial strength, enrollment demand, and faculty culture);
  • that neither the School Head’s experience in the field of education nor cumulative experience as School Head is related to the key school performance variables. There is no evidence a school improves with the Head's experience.The Head’s current length of tenure, however, was correlated with the school’s financial strength;
  • enrollment demand is related to the strength of leadership and well-being of the School Head; and,
  • the School Head’s level of professional support and well-being significantly influences the faculty culture—a central construct that enhances the student experience and the enrollment management process.


Vol. 42 No. 16

A confusing element of a school’s accounting is the bald statement, “We have a million (or some other number) dollars in endowment.” What does that mean? In most endowments that ISM examines, that number includes different elements, each of which has distinct characteristics. In a previous article, we discussed true endowment. Here we think about quasi-endowment. As the Business Manager or Chair of the Finance Committee, how do you think about this money? How does the Finance Committee think about it? How do you educate the Board about it in its strategic planning process?

Avoid the Danger of Misinterpreting Research

Vol. 42 No. 15

We live in an information age where we are inundated daily with information on multiple devices. News feeds quickly summarize research from various sources, and weeding through all this information can be daunting. As a result, we often forget to put on our critical reading glasses.

Carrying Out the Annual Administrative Agenda

Vol. 42 No. 15

In a previous article, we outlined the process for developing the annual administrative agenda. This, the fourth in the series on setting annual agendas, details how to orchestrate the administrative agenda in subsequent Leadership Team meetings.

True Endowment

Vol. 42 No. 15

What is the nature of true endowment? We note that true endowment is distinguished from quasi-endowment (which will be dealt with in a subsequent article). From your view as School Head, Business Manager, or Finance Committee member, what are the issues you should be considering?

Head Support and Evaluation Committee: Reporting to the Board

Vol. 42 No. 15

The Head Support and Evaluation Committee (HSEC) is the link between strategy and operations. It is a safe place for the Head to report ongoing progress toward his or her goals, and for the HSEC to advise, support, and hold the Head to account.1 But what is the relationship of the HSEC to the Board? After all, the reason for the HSEC is the Board’s inability to evaluate the Head. But, at the same time, the Board is the Head’s employer and has a “right to know” and ensure the Head is held accountable.

Executive Leadership: The Relationships Between Predictability and Support, the School Head's Well-Being, and Faculty Culture

Vol. 42 No. 14

In the first two articles in this series, we shared the results of our 2016 study on executive leadership, well-being, and school performance. The study validated the centrality of a high-quality, charismatic, and flourishing executive leader in the school’s ability to drive the school’s success, including enrollment demand.2 In this third article, we answer the question, “What predicts high scores on executive leadership?”

Through the first two articles, we established that charismatic (but not excessively extroverted) leaders who guide schools with greater enrollment demand scored higher on our executive leadership measure. Of course, this assumes the school has a strategic plan and a strategic financial plan. In this article, we examine the factors that lead to high scoring on the executive leadership measure (Stability Marker No. 3). In other words, what are the major contributors to being a high-quality leader?

We Need New Evidence for Old Meta-Messages

Vol. 42 No. 14

Private-independent schools have the daunting task of persuading families to purchase what is available free through their public school system. Despite national perceptions that public schools system are “broken,” the annual Gallup/PDK poll finds that parents are happy with their local public schools.1 We can’t rely on distaste for public education to drive our enrollment. More specifically, many of our families live in the same neighborhoods as the highest-ranked public schools in their area. Quite obviously, we must attract and re-attract families to our mission. While each school nuances these messages, schools have approached this task by delivering the following meta-messages to communicate the value of an independent education.

Scheduling Supports Advisory Program Success

Vol. 42 No. 14

The advisory program can be a distinguishing feature among your school’s offerings, and a source of multiple benefits to your students and their families. Of course, it must be well-planned and effectively implemented. There’s also the question of how advisory activities will be scheduled. The success of your advisory program depends, in part, on how it is incorporated into the school day, week, and year. As the School Head, meet with your scheduler to go over your expectations and ensure the schedule supports the scope and excellence of the program.

The Head Support and Evaluation Committee: Technicalities

Vol. 42 No. 13

In an earlier article, “The Head Support and Evaluation Committee: An Update,” we stated that “the HSEC, as a Board Committee, is primarily concerned with the Board’s strategic objectives and the Head’s responsibilities in their successful achievement.” Consider now the HSEC’s membership, its charge, and its self-evaluation.

In staffing the HSEC, the Committee on Trustees should consider the School Head’s position as an executive and as the sole employee of the Board. The Head is responsible for all aspects of the school’s operations, from marketing to teaching Social Studies—without a peer in the school. Use the following chart to ensure the appropriate questions have been asked about the HSEC’s membership.

Developing the Annual Administrative Agenda

Vol. 42 No. 13

The annual administrative agenda delineates the tasks of the School Head and the Leadership Team (the senior administrators who report directly to the Head). A previous I&P article articulated the process for uncovering the operations responsibility in the Board’s strategic plan/strategic financial plan.* That is not the totality of what the School Head and Leadership Team are accountable for, however. This article, the third in the series, details how to develop the annual administrative agenda.

How to Jump Start a Stalled Fundraising Campaign

Vol. 42 No. 13

Many schools run capital campaigns and annual fund campaigns simultaneously. Capital campaigns are usually implemented over several years and are designed to increase capital assets such as new or improved facilities and/or growing endowment. Annual fund campaigns are repeated yearly and are most often created for enhancements for the current year. Balancing these two efforts requires clear goals, appropriate volunteer training, targeted donor solicitation, and a strategic sense of timing. A capital campaign, because of the size of the goal and the drive’s length, is more likely to falter than an annual campaign that in many schools has become habitual. Being prepared with “jump-starting” strategies can mean the difference between success and failure.

Review Your School's Capitalization Policy

Vol. 42 No. 13

As your school grows in size and complexity, you should review (or establish) accounting policies. Often overlooked is the school’s capitalization policy.

A capitalization policy sets guidelines determining which purchases you expense and which purchases you capitalize and then depreciate. It allows your school to match revenues more closely to the expenses associated with the use of those assets. By depreciating an asset, you recognize that it will provide value to your school’s operation for several years. It is easy to determine what constitutes an asset. Land, buildings, utility systems, kitchen equipment, and vehicles certainly qualify. Classroom furniture, computers, and athletic equipment, among others, may also fall into the asset category.

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