Reactive or Proactive, Systematic Errors and Moral Hazard

The question is not whether to be a proactive or reactive, but what is best for an institution.  From a college level Management 101 course, students are fed with the most fundamental POAC or POLC, the four management functions basic concept, which later add by others such as Fayol to POCCC.  Some others add other functionalities and turn the 4-basic concept into POSDMCCC.  The point that the Association is trying to bring to the readers is on the first two letters which is P and O.  These two letters have appeared regardless of who define the management functions.

From the basic concept to the most fancy one, the P is always put on the top or the first letter.  Activities in any organization, regardless of it size, goals or business structures will start with P for PLANNING.  Without it, an organization soon will collapse.  This is exactly the situation that one will find many are happening in the US higher ed institutions.  Perhaps, only handful organizations are operating based on the P, and the results are real.  One can search on the internet by simply typing the words of “student loans”, and there will be many articles on the topic.

Despite all the crystal clear facts, there are always others who think differently.  When the decision makers have to be realistic with the budget situation, they are facing a strong resistance, which then causes a dilemma.  This kind of situation should not happen at the first place, if an organization operates based on short or long range planning.  But what unique about US higher ed, is that the top person hops from one institution to the next or retire if she or he learns problems.  Therefore, they do not need to make a plan in managing the institutions, except exit plan for themselves.  This is another example of systematic errors that cause by moral hazard which the Association has discussed many times in the past.  Therefore, none of any analytics can be used effectively, if an organization is run without the P magic word or where the systematic errors exist.