Shifting from a Scarcity Mindset to an Opportunity Mindset

Chess game

Series: Costs Down, Quality Up

Historically, initiatives to improve quality have also meant added cost—smaller class sizes, more faculty who conduct research, etc.—but this is no longer a sustainable model for all institutions. What are the innovations that can actually drive the cost to educate a student lower while driving critical outcomes like student success and completion higher? This series offers provocative questions that challenge the cost-quality paradigm and the old ways of managing institutional strategy and growth.

Also in this series:
Why Good is Still the Enemy of Great at Most Colleges and Universities
Rethinking General Education: Too Many Options?
3 Ways to Address the Cost/Quality Challenge Facing Higher Ed: Lessons from the Healthcare Sector
Overcoming the Heavy Weight of Tradition: A Practical Approach

The Danger in a Scarcity Mindset

Many institutions have responded unproductively to economic scarcity in recent years—often by freezing in place. Institutions have reduced spending, streamlined inefficient practices and shelved futuristic plans, in effect trying to do the same work with fewer people and fewer dollars.

We don’t mean to sugar coat or deny problems. The lack of investment capital or any number of other critical resources presents real and difficult challenges, leaving institutions with hard choices to make. But this way of reacting reinforces a dangerous dynamic that is prevalent on many campuses, something we call the “scarcity mindset.” By this we mean that prevailing beliefs, even amongst leadership, are uninspired and self-limiting – “we’re carrying too much, change is hard, it won’t work, we never have enough resources, we’ve always done it this way, lets stick with the tried and true.”

The danger in this thinking is that we operate in a passive mode—reacting to events as they occur—as opposed to a proactive mode —responding thoughtfully and opportunistically to changing conditions. We become skilled at advocating for resources, but not at creating them. In fact, this way of reacting is not new, it’s the way higher education has operated for decades. As articulated in “The Other Higher Education Bubble,” we have always assumed that more resources are a prerequisite for providing higher quality of services.


Leadership advisor and Cambridge Fellow, Navu Radjou, has studied this issue for many years and developed the concept of “frugal innovation” which is defined as creating more economic and social value with fewer resources. In his research he contrasts the traditional approach of innovation in the U.S. – by adding features to products and charging more for them – with the approaches taken in other countries where both consumers and entrepreneurs do not have the same resources. He has a compelling Ted Talk that is well worth 16 minutes of your time and would be a great resource to share around campus when thinking about how can we, in higher education, pursue frugal innovation?

This scarcity mindset fosters powerlessness and inaction, as institutional leaders accept the stance that their institution’s destiny is driven by external factors and agents. We need to re-frame the conversation from “we need more funding from X and Y” to “here’s what we can do, today.” We need to be asking questions like these:

  • How can we achieve higher levels of quality and services through our own efforts?
  • What investments can we make to create sustainable long term returns for the institution?
  • How can we use our current constrained environment to –re-energize and re-focus the institution?

There are opportunities that can be seized during times of constraint and scarcity, but adopting this institutional mindset requires bold, focused, visionary and persistent leadership.  It requires our leaders to counter the scarcity mindset and inspire us toward more productive and investment-oriented habits of thinking. This more productive mindset realizes that resource constraints can actually be a positive force for good that can drive the creativity and innovation needed to confront the challenges ahead.

3 Examples of an Investment Mindset in Higher Ed

We can learn from examples of such innovative thinking at a growing number of colleges and universities. In each of these cases, the institution responded to a real and significant challenge with bold ideas and new thinking. They were not afraid to make critical investments that, as we’ll see, will pay off in terms of better outcomes for students (improved learning and graduation rates) and for the institution (reduced costs and improved revenue streams).

We’ve selected these examples because they represent three very different institutions facing different challenges. Let’s look at:

  1. National Louis University’s Harrison Pathways Program
  2. Georgia State University’s focus on student success
  3. Bay Path University’s approach to creating new academic programs

1. National Louis University’s Harrison Pathways Program

Recognizing the growing need of low-income and first-generation students in the surrounding Chicago neighborhoods, National Louis set out to create a $10,000/yr bachelor’s degree that could have a net cost of $0 in tuition when students utilize the Illinois MAP grant and the Federal Pell Grant.

The program, designed from the ground up, uses existing physical capacity but entirely new instructors, curriculum, and student success coaches to ensure a highly-personalized but scalable system for educating students. Early results are promising—the program is growing, profitable, and the first-second year retention rate is 75%, for a population that is usually 50%. You can read more about the program here.

2. Georgia State University’s focus on student success

Facing unacceptably low graduation rates, Georgia State didn’t place the blame on the high-need student population it was serving or respond to demographics with an attitude of helplessness. GSU took matters into its own hands and invested in a new approach to student success.

Knowing that personalized attention was key to increasing the number of students they graduate, GSU invested in 40 additional academic advisors and a state-of-the-art predictive analytics system in order to better track and support students. The expense wasn’t minimal but it enables them to provide the kind of attention more commonly seen at small independent colleges, at an institution that serves more than 50,000 students. As a result, they now graduate 1700 more students each year than just five years ago.

3. Bay Path University’s approach to creating new academic programs

In the face of unfavorable demographic trend-lines, many small and independent institutions are struggling to compete. Rather than rely on shrinking academic programs to match declining enrollment, Bay Path University has intentionally made the decision to grow in ways that are market-relevant and mission-minded.

Bay Path has nurtured a culture of thinking entrepreneurially: spotting trends and identifying how new programs could enhance the overall and unique position of this women’s serving institution. New programs like the American Women’s College (the first women’s only fully online program) and new initiatives that emphasize leadership, community service and career preparation for women have help Bay Path become one of the fastest-growing private institutions in the country. You can learn more about their approach to growing new academic programs here.

In Closing: What an Investment Mindset Requires

Adopting an investment mindset as opposed to a scarcity mindset—as these institutions have—requires courageous leadership. We must believe that success is achievable and demonstrate our own excitement and energy in pursuit of it. We must also be committed to engaging the entire community in understanding institutional challenges. Empowering staff, faculty and students to be part of the solution will free the collective imagination, yield new creative ideas from those most engaged with the inner workings of the institution, and foster a united sense of investment in our shared future.


The big challenges and questions facing higher education don’t have clear or easy answers. Leaders are going to have to cross boundaries, negotiate complexity, and take smart risks to move their institutions forward. Our leadership programs, uniquely designed for higher education, emphasize practicality and interactivity. You’ll sit next to and work with colleagues from across the institution, including academic and non-academic leaders. Discover your leadership potential and experience what other leaders in the field are so highly recommending. Explore our calendar of upcoming leadership programs: