By James J. Kragenbring
A key lesson from the renaissance of Midwestern Seminary is that a healthy administration lays the foundation for a healthy institution by creating a robust and sustainable business model. Dr. Allen described this when he became President, and the last decade has borne out this truth. The renaissance our institution has experienced has indeed touched every square inch of the campus. Herein I endeavor to provide an insider’s perspective on how a healthy administration relates to a healthy institution by giving an account of how such a foundation is laid, interwoven with a first-person account of how it happened at Midwestern Seminary.
What is an Institution?
An institution is an organization pursuing a God-given mission in Christ-honoring ways. This definition is faithful to Scripture, sensitive to our cultural context, and consistent with social-scientific approaches to social institutions. Every organization is shaped by purpose, elements, and interconnections. Our purpose at Midwestern—our God-given mission—is to serve the church by biblically educating God-called men and women to be and make disciples of Jesus Christ. The elements of our organization include faculty, staff, students, classrooms, dorm rooms, a wifi network, white boards, and more. Interconnections are all the complex ways in which we interact to achieve our purpose—all of which we intend to be Christ-honoring.
Building a Healthy Administration
The responsibility of administration is to coherently organize the elements and interactions of the organization to maximize effectiveness in achieving its purpose. Put another way, the role of administration is to create positive feedback loops, uniting elements and interconnections in ways that multiply our impact as we seek to fulfill our God-given mission.
I joined Midwestern to lead Institutional Administration during the Summer of 2017, at the chronological midpoint of the last decade of growth. For the last ten years, Midwestern has been one of the fastest growing educational institutions in the United States, growing from just over 1,000 students and $10 million in revenue during the 2011-12 academic year to almost 5,000 students and $33 million in revenue at the end of the 2021-22 academic year.
Extraordinary growth was a blessing that transformed the institution in countless ways, many of which we celebrate in this issue. But growth also exerted pressure on the foundations of the institution. Midwestern needed a robust and sustainable business model—one that stewarded all elements and interconnections with utmost wisdom.
Identity
In view of its role in the institution, I aspired for Institutional Administration to develop an identity as the “towel & basin division” (John 13). This is on account of our calling to do the often inglorious and sometimes even dirty work that enables others to fulfill their callings. For members of our Grounds Team, Custodial Team, and others, the dirty work is quite literal! For everyone else in Institutional Administration, the towel and basin is a metaphor for humble service across our campus to support the work of others. Today I am privileged to lead a team of men and women who embody this identity, eagerly serving students, faculty, and other staff so as to multiply their ministries.
Values
In view of what administration is, I aspired for two values to shape our divisional culture: best ideas and neighborly love. These two values guide how we organize the elements and interactions of our organization to maximize effectiveness in achieving our God-given mission.
At the most basic level, best ideas guide what we do and neighborly love guides how we do it. We seek to discern and implement the wisest means by which to organize our institution (best ideas) and we interact with one another and with those we serve by loving them as we love ourselves (neighborly love). We seek to be good stewards and to serve others by doing for them what we would want done for us, were we in their position. This is how we contribute to Midwestern’s God-given mission in a Christ-honoring way.
But these values have an even deeper significance, for their impact extends beyond what we do on our campus. As administrators, good stewardship undertaken in a way that loves one’s neighbor is loving God with our minds. And good stewardship is not only a means of loving our neighbor nearby, but also far away. In exercising good stewardship, we are loving the churches and church members that partner with us through the Cooperative Program as well as those that will be impacted by our graduates’ ministries. These values, then, compel us ultimately toward love of God and neighbor.
Strategy
Guided by this identity and these values, we enacted a strategy to direct our work. We have consistently applied a paradigm designed to steward the elements and interconnections of our organization wisely: process, technology, better people, more people. We have focused first on creating processes: intentional, thoughtful, and repeatable ways of performing necessary and recurring tasks or functions. With processes established, we have sought to implement technology: to develop and deploy technological solutions that make the established processes efficient and scalable. With respect to personnel, we have consistently striven to employ better people in every position: to invest in the professional development of existing staff and to attract professionals who would enhance our team. Finally, when the benefit from improvements in process and technology and investments in our existing team have been fully realized, we have added a few more people where they were essential to improving our effectiveness and efficiency.
A Healthy Administration and A Healthy Institution
A healthy administration lays the foundation for a healthy institution by providing the necessary elements, designing interactions, and coordinating both in a manner that multiplies the institution’s effectiveness in achieving its God-given mission—that is, by building a robust and sustainable business model. Of course, much more is required for an institution to be healthy. But given what administration is and does, it is nearly impossible to have a healthy institution without a healthy administration serving and leading it.
Given their innate interdependence, the health and achievement of any one area of an organization depends significantly on the health and achievement of others. Compliments and congratulations properly go all around. In this issue of The Midwestern Magazine, my colleagues have celebrated achievement in building our faculty and building our team. Herein, I would like to celebrate achievement in building our institution, beginning with achievements in Institutional Administration and extending to achievements that result from our shared stewardship of the institution.
An efficacious administration. A healthy administration is effective in discharging its responsibilities. Effectiveness is observed directly in Institutional Administration: we have implemented best business practices, enhanced care for our physical and digital spaces, and improved service to the faculty, staff, and students who depended on us, all of which has led to tangible operational results. Effectiveness is also observed indirectly in our institution, in many of the ways that follow.
An efficient administration. A healthy administration is efficient in its use of resources. Consistent application of our operating strategy has made our division not only effective, but also efficient; we have built a lean and cost-effective organization. Based on the most recent data, we lead our peers in cost-efficiency. We administrate effectively at a cost that is 53% lower than our peer average per student (full-time equivalent); and institutionally, we provide high-quality education at a total cost that is 41% lower than our peer average.
A reproducing administration. A healthy administration reproduces itself. Our focus on better people—on investing in our team—has made us a division that produces leaders. Seven of the nine individuals who lead the departments and auxiliaries within Institutional Administration have been hired, developed, and promoted into their leadership role. This emphasis on professional and leadership development not only provides the key leaders we need to thrive, but it also preserves the identity, values, and strategies we have developed in our division.
A financially healthy institution. A healthy administration leads the organization to financial health. Apart from generous financial gifts from donors, an organization becomes financially healthy only as positive annual operating results and investment returns compound over time into financial strength. Over the last decade, Midwestern has been both the beneficiary of generous donors and has operated with increasingly positive operating results that have bolstered its endowment, transforming it into a financially healthy institution.
For the 2012 academic year, Midwestern budgeted to break-even, estimating just under $10 million in revenue and expenses. At the end of the 2012 academic year, Midwestern had $23 million in net assets, of which only $6 million was endowment or cash. For the 2022 academic year, we budgeted for just under $30 million in revenue and $21 million in expenses; our budget called for (and we achieved) a positive operating margin of $9 million, which was earmarked to build our endowment and fund necessary capital projects. At the end of the 2022 academic year, we had $79 million in net assets, of which $35 million was endowment or cash. The fruit of compounded positive annual results has been financial health: net assets more than tripled and cash and endowment increased six-fold. Soli Deo gloria.
A robust business model. A healthy administration builds a robust business model; this is the foundation it lays. Coherently organizing the elements and interactions of the organization to maximize its effectiveness in achieving its purpose leads to a robust business model. A robust business model is thus a result of the foregoing: an efficacious and efficient operating model combined with a prudent financing model creates a robust business model. And a robust business model provides many advantages for the institution; it touches every area of the campus.
An agile organization. A robust business model provides the agility to capitalize on new opportunities and to respond to challenges from the ever-changing environment in which we exist. It does so by providing the operational capabilities and financial margin to defend against threats and to invest strategically in opportunities. Countless successful investments in Institutional Relations and in Academics over the last decade testify to the value of this agility. Examples include the Timothy Track, in which masters students gain hands-on ministry experience as apprentices in local churches; the For the Church Institute, which takes theological education to local churches around the globe; Spurgeon College athletics, which now has four competitive intervarsity teams; and countless new undergraduate majors, graduate emphases, and doctoral fields of study that have expanded the ways we biblically educate God-called men and women.
An affordable education for students. A robust business model enables us to provide affordable education to our students. We desire to train ministers for the Church at a cost that enables them to launch into ministry with little or no educational debt resulting from their education at Midwestern. In order to do this, we build into our business model the expectation that tuition, fees, and auxiliary costs will be affordable to students. This commitment, combined with the generosity of the Cooperative Program and the strength of other components of the business model, has enabled us to continue providing an affordable education while investing in new initiatives and renewing our campus.
A renewed campus. A robust business model enables us to care well for our physical spaces. Over the last decade, Midwestern has spent over $45 million to build or renovate campus facilities and housing. These investments have impacted every building on our campus.
The first major project was the renovation of what is now known as the Berquist Administration Building and the construction of Jenkins Hall, completed in 2015. Jenkins Hall is named in honor of Bill and Connie Jenkins, whose generosity enabled the project. The project provided modernized facilities for the President’s Office, the Communications Office, and other administrators. It also provided for the creation of the Spurgeon Library—a permanent home for Charles Spurgeon’s personal collection and a research center around it. Also in 2015, the Administration began a program to renovate all campus housing, starting with the long outdated campus apartments.
In the spring of 2017, we broke ground on a new building to be known as the Mathena Student Center, named in honor the Mathena family in appreciation for their generous lead gift toward the project. Completed and dedicated during the fall of 2018, the Student Center added 40,000 square-feet of space for a new cafeteria, coffee shop, bookstore, offices, recreation area, gymnasium, and fitness facility, as well as new formal spaces for the Presidential Dining Room and President’s Reception Room.
In 2018, while constructing the Mathena Student Center, we renovated the 28,000 square-foot Trustees Building to create new faculty offices, a new student services center, and modernized classrooms. This renovation significantly enhanced the campus community by relocating our faculty to the Main Campus and by providing a new, central location for all student services.
Growth in the residential population of Spurgeon College and in our Global Campus and Asian Studies programs necessitated two renovation projects on our North Campus during the Summer of 2019. That summer we converted 10,000 square-feet of office space to a men’s dormitory for Spurgeon College and renovated 7,000 square-feet of unoccupied office space to accommodate our Global Campus and Asian Studies programs.
During the summer of 2020, we renovated the last outdated building on our Main Campus: our campus library. Now known as the Mark T. Coppenger Library, the renovation modernized the library in both form and function and created new space for our growing research centers, residential doctoral programs, and institutional archives.
With the library renovated, our Main Campus has been fully modernized. Our North Campus has been renovated and repurposed to new use. And in Campus Housing, all of our apartments have been renovated. Only two major buildings remain with significant deferred maintenance: the undergraduate dormitory and the Vivion Home. Renovation of both buildings began this spring, and we anticipate the completion of both next summer. By God’s grace, and through the means of generous donors and effective administrative stewardship, our campus has been renewed. As of next summer, every permanent building on our campus will have been constructed or renovated, all without incurring long-term debt.
Every Square Inch
A healthy administration lays the foundation for a healthy institution by building a robust, sustainable business model. Our robust, sustainable business model has, indeed, touched every square inch of our campus. Both literally and metaphorically, it has laid the foundation for the renaissance of our institution.
