Olin College

October 24th, 2009

As stated in our Founding Precepts, Olin College was intended to "be an important and constant contributor to the advancement of engineering education in America and throughout the world." To support this purpose I write to announce the formation of a new Initiative for Innovation in Engineering Education at Olin College. Professor Lynn Andrea Stein has agreed to serve as the founding Director of the Initiative, and Mr. Ron Guerriero will serve in a supporting role as its Director of Business Development. Due to the importance of this Initiative and the complexity of internal and external relationships involved, I will provide personal supervision of the Initiative until it becomes well established. Lynn, Ron and I will work closely with Steve Schiffman, GIll Pratt, and Mark Somerville.

The overall goal of the Initiative is to provide coordination, leadership, and a single point of contact for both internal and external conversations aimed at fostering innovation and change in engineering education. In the near term the Initiative will provide an initial point of contact for potential new collaborators, seek external funding, and plan and execute workshops, meetings and custom programs in response to external requests. In order for this Initiative to succeed it will need the involvement of a number of Olin faculty members, and the programs within the Initiative must contribute to the professional development of the faculty involved.

In the longer term, the Initiative will aim to arrange personnel exchanges (fellowships, and other visits-to Olin and by Olin community members to other institutions) that will further enrich our own on-campus conversation. In order to achieve our purpose it is important that these activities be better organized and that Olin be better recognized for its efforts to innovate in engineering education.

July 31st, 2009

To all members of the Olin community,

About a year ago I approached the presidents of Babson College and Wellesley College to discuss a vision. It occurred to me that each of our institutions could benefit significantly now from a much closer relationship-as if we were all three part of a "virtual university" in the Wellesley-Needham area. We noted that the campuses are sufficiently close together that they might easily fit within the campus perimeter of a large state university, so our proximity would allow us to cooperate in ways that may approximate a single institution, if we had the mindset to do this. As we considered the potential for expanded joint academic programming, business and service collaborations, jointly sponsored conferences and guest speakers, and especially the potential for new interdisciplinary research and educational initiatives, our enthusiasm grew. We also recognized that the substantially different disciplinary foci of each of our campuses (engineering, business, and liberal arts) are remarkably complementary, and since the overlap in our programs is minimal, the potential for mutual benefit from expanded collaboration is substantial.

Over the year my conversations with President Bottomly of Wellesley College and President Schlesinger of Babson College gained momentum, and we involved other members of the senior staff. At this point I am certain that both President Bottomly and President Schlesinger are as committed to building on the current and possible future areas for collaboration as I am. The results could provide benefits for all members of all three campus communities, and in the best outcome, it could be transformational. If we succeed in building the necessary working relationships, the resulting three-way partnership and alliance could even help develop a new model for academic cooperation that would be of value to other institutions.

However, all such visions are limited in value and only provide benefit if they inspire others to reach out and take the initiative to build the relationships needed to realize the potential. The easy part is envisioning the future; the hard part is making it happen. To make this particular vision real will require the enthusiasm and commitment of many people, at all levels of the campus community, on all three campuses. There are a million reasons why we might choose to continue doing things the way we have always done them rather than try to build a new path that involves our partners.

So, to take full advantage of the potential benefits, we want to encourage all community members-- faculty, staff, and students--to take the lead in proposing new initiatives across the schools. In September, the three college presidents will jointly announce an exciting new initiative in the area of sustainability, so stay tuned. I will keep you posted on this and other developments. As the smallest of the three institutions, Olin stands to gain the most from expanded opportunities. I hope you will join with me in making this vision a reality in the months and years ahead.

Areas of current collaboration:

• Cross registration for courses unavailable at the student's home campus, based on availability and at no cost to the student.
• Courses offered by faculty from one college on the campus of another, at no cost. Examples include introductory accounting and law courses offered by faculty from Babson College on the campus of Wellesley College; courses in anthropology, immunology, mathematical modeling, human genetics, and introductory engineering offered by Olin College faculty on the campus of Wellesley College; and a course in Chinese offered by Wellesley College faculty at Babson.
• Jointly appointed faculty members on two or more campuses. An example is the joint appointment between Babson and Olin Colleges of faculty in technology entrepreneurship and science.
• Targeted academic degree and certificate programs. Examples include the MS in Management degree with a concentration in Technology Entrepreneurship offered by Babson College for Olin students; and the Certificate in Engineering Studies program offered by Olin College for students from Babson and Wellesley Colleges.
• Jointly offered academic courses on two or more campuses. Examples include Issues in Leadership & Ethics taught by the presidents of all three colleges for seniors from the three colleges; a course in product design involving both faculty and students from Babson, Olin, and Rhode Island School of Design (RISD); and a class in new technology ventures ("business by design") involving both faculty and students from Babson and Olin.
• Intercampus Curricular and Research Initiatives. An example is a new curricular initiative on "design for business" launched by faculty from Olin and Babson Colleges.
• Reciprocal library privileges.
• Open membership and participation in a variety of student activities and programs across all three campuses, at no cost. Examples include participation in club sports and drama ensembles involving students from the three campuses; music and dance ensembles involving students from Babson and Olin; participation by Olin students in Babson's Blank Center programs as well as participation by Babson students in Olin's Foundry programs; and programs offered for students on the three campuses by the Women's Leadership Center at Babson College and the Wellesley Centers for Women.
• Intercampus services to foster cooperation. An example is the student shuttle service between the three campuses.

Possible areas for expanded future collaboration:

• Expansion of academic program collaborations. Examples include developing joint grant proposals for new academic initiatives; increasing the opportunities for students to cross register at neighboring campuses; increasing the number and breadth of integrated certificate, degree, and major concentration programs across institutions, i.e., Wellesley's education department offerings; support for joint student and faculty research, and student internships; and jointly hosting national and international programs to bring major new ideas onto our campuses.
• Joint sponsorship of visitors, speakers, and conferences. Examples include jointly hosted visits by visiting fellows from academia, business, and industry; jointly sponsored workshops, forums, and high-profile speaker series for academic, business, political and industry leaders; and jointly sponsored co-curricular programming.
• Expansion of business and service collaborations. Examples include using economies of scale in joint purchasing of supplies and services; initiation of joint intra and intercampus projects to enhance the sustainable practices of campuses and business operations; and staff sharing.
• Joint outreach programs. Examples include joint outreach to the regional and state community, especially to small business and non-profit organizations, experts, and advisors; joint outreach to the K-12 community, especially to teachers; and joint admission recruitment efforts.

June 18th

To all members of the Olin Community,

Now that the 2008-09 academic year is over and the May Board of Trustees meeting has concluded, I write to report to you on the major events of last year and our plans for the 2009-10 academic year.

As you know, Olin College played a central role in two major national meetings last year aimed at catalyzing change in engineering education across the nation. The first of these was the Summit on the National Academy of Engineering Grand Challenges held at Duke University in early March. Olin partnered with Duke University and the University of Southern California to co-organize and sponsor this meeting which was intended to change the conversation about engineering and the future. A total of 1,100 people attended the meeting, including 400 students. At the initiative of Olin, Duke, and USC, a new national program was launched at the Summit, the National Academy of Engineering Grand Challenge Scholars Program.

Also this spring, Olin partnered with the University of Illinois at Urbana-Champaign to co-sponsor the Summit on the Engineer of the Future 2.0, a national meeting held at Olin College in early April. This meeting was attended by more than 150 engineering educators from around the world and a new proclamation was signed that announced a broad commitment to innovate in engineering education.

There were, of course, many other wonderful academic achievements last year, but I won't take the time now to enumerate them.

Efforts to recruit the Class of 2013 were highly successful, and once again Olin will welcome an incoming class next fall that is extraordinary in quality and achievement. We expect to enroll 85 students next fall, and for the first time in Olin history, the majority of entering students will be women (53%). The academic and extra-curricular credentials of the class are uniformly exceptional and are nearly indistinguishable from those of previous entering classes at Olin.

The Board of Trustees elected two new members at their meeting last month. They are Dr. Elizabeth Armstrong and Mr. Tullio Cedraschi. Dr. Armstrong is a member of the faculty at Harvard Medical School, Director of the Harvard-Macy Institute, and Director for Education Programs at Harvard Medical International. She was awarded an honorary doctorate from the University of Lund Medical Faculty for her international work in leading innovation in medical education, and she is a former trustee of Cornell University. Mr. Cedraschi served for 30 years as President and CEO of the CN Investment Division, one of the largest pension funds in Canada. Under his leadership this US $15 billion fund achieved an annual rate of return of 11% over a period of 30 years. He is a Director of the Toronto Stock Exchange and a Governor Emeritus of McGill University. More biographical information on both new trustees is available on the Olin College web site, under "About Olin."

In spite of these and many other important achievements, much of last year was dominated by the global financial crisis and its effect on our financial position. Olin's financial model is highly dependent on investment returns from the endowment portfolio to provide a large fraction of our annual operating revenue. In fact, about 78% of our operating revenue was derived from the value of our endowment last year. Very few other colleges or universities are so highly dependent on this one source. In fact, most other institutions derive less than 20% of their operating revenue from endowment spending. As a result, compared to other institutions, Olin has had a financial model with most of our "eggs" in this one basket.

The severity of the financial crisis surprised almost everyone in the financial world, and endowment values dropped at almost every college or university in the country. Olin was no exception. Even though our financial managers performed in the top quartile nationally during the crisis, our endowment lost substantial value, dropping by about 25%. The result is that projecting into the future, Olin College may experience serious financial difficulty with our current financial model if the value of the endowment does not return quickly to the level it held before the crisis began last fall--unless we take action to address the shortfall.

As everyone on campus knows, Steve Hannabury and I scheduled open campus meetings in the auditorium twice each month since last Fall for the purpose of sharing all the detailed numbers and to answer all questions. We also recorded these presentations in the Spring and shared them in webinars with alumni and parents to make sure everyone in the community had an opportunity to make suggestions and monitor our progress. Our goal was to keep the campus community well informed of our changing financial status.

The Board of Trustees and the Cabinet have been working especially hard all year on containing the financial risks while preserving our unique academic program and quality. We began early last fall to reduce all unnecessary expenses. For example, we suspended most of the new expenditures called for in our 2007 Strategic Plan, substantially reduced expenditures during the 2008-09 academic year without layoffs, and generated more non-endowment revenue than anticipated. We project that when we end the current fiscal year on June 30th we will have reduced endowment spending by about $4.47 million out of the budgeted $26 million. The result is that our endowment spending rate for this year will fall below 5% for the first time in five years. In addition, we have prepared and the Board has approved an operating budget for the 2009-10 academic year that includes more than 6% in additional reductions in operating expenses. This was accomplished in part by eliminating salary increases for faculty and staff this year, just as many other colleges and universities have done.

In spite of these reductions, we have continued our strong commitment to the academic program, and recruited two exceptional new faculty members who will join us in the fall. One of these new faculty positions amounts to a net increase in the total faculty count, an installment on the commitment in our strategic plan to further grow the total faculty size in future years. We expect to continue our efforts to recruit new faculty members next year, and to make strategic investments in our academic program to maintain and further improve the high quality of the learning environment for Olin students.

But these immediate cost reduction efforts are not likely to be enough to insure both our long term financial sustainability and the quality of our academic program. The magnitude of the decline in our endowment coupled with our unusually high dependence on endowment spending for operations creates a challenge that is too large to address through budget reductions alone. As explained in my remarks in the auditorium each month last year, our plan is to address the financial needs through a four-point approach. In addition to immediate budget reductions, we plan to also increase our efforts at private fund raising through gifts to the College. Thanks to your support, our fund raising results this year are more than 48% ahead of the total received for all of fiscal year 2008, and participation rates remain very high-in spite of the very difficult financial climate that we are all facing. I am enormously grateful for your generosity in this time of financial stress.

The third point in our plan for dealing with the financial crisis is to expand our efforts to diversify our financial model and reduce our high level of dependence on endowment spending by developing new sources of revenue. After many months of careful study and deliberation, and after receiving many thoughtful and passionate letters from students, parents, faculty, and staff, the Board of Trustees has very reluctantly decided that it is in the best interest of Olin College to reduce the value of the Olin Tuition Scholarship by 50% for the students who will enter in the Fall of 2010 (Class of 2014). This decision will not affect any current student at Olin, nor will it affect the students arriving in August of this year (Class of 2013). Members of the Class of 2014 will each receive a very large merit scholarship each semester for 8 semesters. The value of the scholarship will amount to about half the total cost of tuition at Olin. In addition, Olin College will remain need blind in admissions, and all admitted students will be eligible for Olin's standard need-based aid.

The Board feels that the level of tuition scholarship that the College can afford to provide is likely to change from year-to-year as the financial crisis evolves, and, therefore, the level of tuition scholarship will be reviewed by the Board each year and may change for future entering classes.

The Founding Precepts of Olin College clearly identify the permanent goal of providing an exceptional engineering education to all students at little or no cost, and it is our sincere intent to restore the scholarship to 100% when and if the future financial condition of the College might allow this. However, since the current forecasts for the duration of the financial recession indicate that it is likely to take several more years before the recession will completely end and it will take some time to see significant increases in gift revenue, it is impossible to predict when the College might be in a position to make such a decision.

It is also important to note that to implement a decision as profound as this reduction in tuition scholarship is a complicated issue for the College due to the legal requirements of the Endowment Grant Agreement from the now-dissolved F.W. Olin Foundation. It has taken several additional weeks to clear all the governance and legal hurdles in making this decision because of the high level of consensus required on our Board and the unanimous approval required from the three surviving directors of the Foundation. As you might imagine, this decision was the result of very intense and difficult discussions.

The fourth point in our plan for dealing with the financial crisis amounts to a kind of insurance on our ability to maintain the quality of the academic program through this difficult period. This insurance is provided by the ability of the College to request short-term funding from the endowment to address any unforeseen crisis, if this should arise. The process requires special approval and high levels of consensus from the Board, but would avoid the need to suddenly reduce the quality of learning experience for any current students.

As you may have noticed, the financial markets have begun to show some signs of recovery in recent months. I remain optimistic that the steps outlined here will contribute to our continued strong financial security and continued rise in reputation and influence nationally. I remain committed to providing you with comprehensive reports on the progress of the College as we did last year.

On May 17th we graduated our fourth class at Olin College. I am confident that as the world begins to discover the remarkable talents and abilities of Olin alumni in the years ahead, an ever increasing number of new supporters will join our ranks. Olin is all about creating a new paradigm for engineering education that produces engineering innovators who are entrepreneurial thinkers that will make a positive difference in the world. Finances are important only to the extent that they enable us to touch the lives of more students and to influence change at other respected engineering schools. Olin is involved in an educational innovation that is important for the country and is unavailable at any other institution. Olin really matters-not just to those of us who work here or who are students or alumni, but to many others who are concerned about the future of engineering and of education.

Let me end by thanking all of you for your passion, your patience, and your support through a difficult year. I am confident that working together we will exceed all of our expectations for the 2009-10 academic year. Have a wonderful summer.