RIDING THE WAVE: AMERICA'S CHANGING DEMOGRAPHICS AND ITS EFFECT ON THE ENROLLMENT AND FINANCIAL STRENGTH OF PRIVATE COLLEGES AND UNIVERSITIES ___________________________________ By Michael F. James ___________________________________ A DISSERTATION Submitted to the faculty of the Graduate School of the Creighton University in Partial Fulfillment of the Requirements for the degree of Doctor of Education in the Department of Interdisciplinary Leadership _________________________________ Omaha, NE June 22, 2015 Copyright 2015, Michael F. James This document is copyrighted material. Under copyright law, no part of this document may be reproduced without the expressed permission of the author. iii Abstract This quantitative study explored the relationship between diversity, enrollment size, and financial strength at America's private, four-year colleges and universities. Based on principles of environmental scanning, this study examined the external environment for these institutions in light of changes predicted by the Department of Education's Projections of Education Statistics to 2022. This study created diversity and financial strength scores for all schools in the sample. A correlation test was conducted to determine the correlation coefficient for each pair of variables. Schools were separated into their five size classifications and means were calculated for each variable in each size category. These means were then compared. Scatter plots were created in an attempt to determine any visual clues to the relationships among the variables. Means were calculated separately for the member schools of the Association of Biblical Higher Education (ABHE) in each IPEDS size category. Those means were compared to the means of the peer group as a whole to determine the differences between institutions of biblical higher education and their secular peers. Finally, the financial strength variable was modified to account for the predicted demographic changes. The change between the original financial strength score and the modified score was used as a variable in another round of correlation measurements and comparisons. This study found that it is far too simplistic to say that bigger schools are more diverse or are financially stronger than smaller schools. Likewise, ABHE member schools are not less diverse or financially weaker than their secular peers. Instead, the relationships between diversity, enrollment size, and financial strength are much more nuanced and less intuitive. Keywords: higher education, leadership, diversity, enrollment, financial strength iv Dedication This dissertation is dedicated to my wife and family who suffered through long nights and weekends without me and still provided never ending encouragement and motivation. It is further dedicated to the Lord, Jesus Christ, for whose glory I labor unceasingly. v Acknowledgements I would like to thank my committee members. Dr. Eckman has been a professional mentor and having him on my committee has spurred me to excellence in scholarship. Dr. Hawkins has been a rock from the beginning of my program until its completion. Even when I doubted myself, she encouraged me to trudge forward. It is no exaggeration to say that without her, I could not have completed this dissertation or this program; I owe her an enormous debt of gratitude. Finally, I want to thank the faculty and staff of the Interdisciplinary Leadership department. From my initial contact until my graduation, they were responsive, cheerful, and professional. Thank you to all. vi Table of Contents Page Abstract . iii Dedication . iv Acknowledgements. v Table of Contents . vi List of Tables . .. ix List of Figures . x CHAPTER ONE: INTRODUCTION . 1 Background of the Problem . 1 Statement of the Problem . 3 Purpose of the Study. 5 Research Questions . 6 Method Overview . 7 Definition of Terms . .8 Assumptions . 10 Delimitations and Limitations . .11 Significance of the Study . 12 Summary. 13 CHAPTER TWO: REVIEW OF THE LITERATURE . 14 Introduction . 14 Systems Theory. 15 Environmental Scanning. 17 vii Diversity in Higher Education . 18 Financial Distress . 22 Summary. 24 CHAPTER THREE: METHODOLOGY. 26 Introduction . 26 Research Questions/Research Hypotheses. 26 Description of Participants/Sample. 27 Instrumentation. 28 Variables . 29 Data Collection Procedures. 31 Data Analysis Plan. 33 Assumptions . 37 Ethical Considerations. 38 Summary. 39 CHAPTER FOUR: FINDINGS. 41 Introduction. 41 Review of the Methodology. .41 Data Analysis Procedures. 42 Results. 44 Results for Diversity. 44 Results for Financial Strength . 47 Results for Change in Financial Strength . 49 Summary. 50 viii CHAPTER FIVE: CONCLUSIONS AND RECOMMENDATIONS. 52 Introduction. 52 Summary of the Study. 52 Discussion of the Findings/Implications/Suggestions for Further Research. 55 Diversity . 55 Financial Strength . 62 Change in Financial Strength. 68 Recap of Major Findings. 76 Summary. 77 References. 79 Appendices. ..