Last time I looked, applicants have about a 5% chance of getting accepted at Harvard or Stanford. Said another way, those esteemed institutions have mastered one of the most difficult words in the English language…“NO!!!” If we count the very bright students who either choose not to apply or could never afford to attend, a high school valedictorian probably stands less than a 2% chance of attending either of those two schools. And yet instead of looking disparagingly at Harvard and Stanford as we might look at some snooty, exclusive country club, everyone admires them for their world class programs and ground breaking research conducted by the best and the brightest. They are one example of organizations that know how to match their “product” with the most desirable customers/students to achieve superior results over time.
I have been asked recently if it is true that Credentials does not work with smaller colleges and universities. My answer is “yes and no”. Currently, Credentials works with many smaller institutions, most of which came over in the merger with eScrip-Safe. We are delighted to serve these fine institutions. At the same time, our current sales and marketing efforts are directed towards colleges and universities with enrollments greater than 4,000 students. Why is this? Pretty simple actually. Our primary businesses, transcripts and campus parking permits, are transaction processing services. We derive all of our income solely from processing the underlying transactions. No licensing fees. No start-up fees. Very small annual fee for electronic senders not utilizing our ordering system. In other words, we live and die on the basis of transaction volumes. And since volumes correlate closely to enrollment, larger schools deliver larger volumes than smaller schools. Logical. The other factor that influences our focus is that our services are expensive to implement and maintain. Here’s why:
- Our commitment to delivering the best customer service in the industry is best illustrated by the fact that we operate 3 customer service call centers in three different time zones. And our representatives are supported by superior systems that enable them to be instantly responsive to virtually any inquiry. We think it is central to our mission to assure our client institutions that their students and alumni have a superior ordering experience backed up by world class customer service.
- For more than 12 years we have provided industry-leading transcript processing automation with RoboRegistrar®. Robo is functionally robust and has been engineered to integrate with all major ERP’s as well as outliers and even some legacy environments, with minimal time and effort on the part of campus IT resources. Moreover, each Robo installation is closely monitored throughout the day to ensure things are operating properly, which is costly.
- Our commitment to data security consumes us. Not only do we pay for an annual outside audit of our compliance with PCI DSS, but the ongoing cost of being compliant and protecting our systems from intrusion is incredibly expensive. This is important and something you need to care about.
- We did not need Obamacare to tell us how to be a socially responsible employer. Ever since we could afford to provide employee benefits, we have provided a fantastic healthcare plan to employees at virtually no cost along with a package of other great benefits. Ironically, this may change next year because Obamacare may end up classifying our health plan as a “Cadillac” plan resulting in some kind of surtax. Somebody will have to explain that one to me. Being taxed for providing a superior health plan to employees leaves me scratching my head.
The other factor driving our strategy is ownership. We are not a charity. We are a corporation that pays taxes and dividends. The company is essentially a family-owned business. Our ownership is comprised of the founding partners (who all work here), the prior owners of eScrip-Safe, family members (some of whom work here) and certain long-tenured employees who have made outstanding contributions to the firm. There are no bankers, venture capitalists, angel investors or private equity firms involved. Hence, we control our own destiny and have a continuing obligation to our stakeholders that the firm be profitable, while continuing to grow in a competitive marketplace.
Back to the question of whether we will work with smaller institutions, the answer remains both yes and no. If a smaller institution wants to use all of our services and is willing to live with a price premium, we will be happy to work with them. There does come a point where the fee we would need to charge is unconscionable and we will not do that. It may surprise you to know that we very frequently refer these schools to the Clearinghouse (think of Kris Kringle in Miracle on 34th Street). NSC offers a competitive suite of products without some of the bells and whistles and, perhaps, a lesser commitment to customization and customer service. Nevertheless, their services often satisfy the essential needs of the school and we feel good making the referral. They are a non-profit and therefore, less concerned about what any particular school contributes to its “bottom line”. They derive income from an array of other services in order to keep the books balanced.
In the case of the smaller institutions that came with the eScrip-Safe merger, we think that over time they will self- select to the Credentials platform in order to gain access to some of the superior features and functionality. In the meantime, we are working on ways to deliver those services more cost effectively. At the end of the day, our mission is to match our commitment to service, technology and security with all schools in a way that creates a win-win-win situation. Students win. Schools win. Credentials wins.
In a distant sort of way, we consider Harvard and Stanford to be our role models. We have a long way to go but we’re working on it…every day.