Episode 65: Drumm McNaughton on Boards Balancing Oversight, Insight & Foresight
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What are the forces changing how college and university boards work? What does good governance in higher education look like? How can boards effectively balance oversight, insight, and foresight? We dive into these questions with board governance consultant and host of the Changing Higher Ed Podcast, Drumm McNaughton, sharing insights and examples.
In the rapidly evolving landscape of higher education, the role of a Board of Trustees has shifted from a quiet, background oversight body to a dynamic engine for institutional change. But how exactly does a board balance its fiduciary duties with the pressing need for innovation?
To explore this, Elliot Felix sat down with Drumm McNaughton, a seasoned higher ed board consultant and host of the Changing Higher Ed podcast. With a background ranging from Navy pilot to university provost and board member, McNaughton offers a holistic "tree-top" view of how governance influences everything from the university budget to the career outcomes of a graduating senior.
Keywords: Higher education board governance, student success metrics, university strategic planning.
Defining the Three Pillars of Board Responsibility
At its core, board governance is anchored in legal and ethical statutes. McNaughton identifies three primary fiduciary duties that every trustee must uphold:
The Duty of Care: Treating the institution with the same diligence and concern as one would their own family. This requires "getting into the weeds" of documents and data to understand what is truly working.
The Duty of Loyalty: Ensuring that the university’s interests always come first. This is particularly vital in navigating potential conflicts of interest with major donors or corporate partners.
The Duty of Obedience: Adhering to the laws and mission-driven guidelines that define the institution’s purpose.
While these duties provide the framework, the real "color" of board work comes from strategic foresight. A high-performing board doesn't just approve a budget; it mandates a rigorous strategic planning process that ensures every dollar spent is an investment in the institution’s future.
The "Nose In, Fingers Out" Philosophy
One of the most common pitfalls in higher education board governance is micromanagement. McNaughton champions the "NYFO" rule: Nose In, Fingers Out. The board’s role is to ask the tough questions and set the "what"—the goals and standards—while leaving the "how"—the day-to-day execution—to the president and administration. For instance, instead of telling an admissions department which specific students to recruit, a board should ask: "Are we attracting the students who will thrive here, and what does the data tell us about their progress?"
Measuring What Matters: Student Success Metrics
For a board to truly enable student success, it must move beyond anecdotal evidence and embrace robust data. McNaughton suggests that boards should closely monitor a specific set of student success metrics:
Persistence and Graduation Rates: Are students staying, and are they finishing on time?
Job Placement and Underemployment: Are graduates finding roles that match their training, or are they struggling in low-wage positions well into their thirties?
Return on Investment (ROI): Is the student better off financially and professionally for having invested in this specific institution?
By holding the administration accountable for these outcomes, the board ensures that the university remains a value-add in the lives of its students.
Adapting to a Changing Higher Ed Landscape
The way boards function today is drastically different than it was twenty years ago. Two major trends are reshaping the boardroom: Technology and Diversity.
Modern boards are increasingly using digital dashboards to monitor institutional health in real-time. Simultaneously, there is a push for "experiential diversity." McNaughton uses the Johari Window concept—the balance of knowns and unknowns—to explain that a board with diverse professional backgrounds and perspectives shrinks the "unknown-unknowns," leading to better, more informed decision-making.
Furthermore, boards are navigating the increasing politicization of higher education and the influence of "mega-donors." Staying true to the duty of loyalty is more critical than ever to ensure that an institution’s mission isn't siphoned off by external interests.
From the Boardroom to the Cafeteria
McNaughton’s most practical advice for board members seeking to drive success? Get out of the boardroom.
He shares the story of a board chair who moved their meetings from catered boardrooms to the student cafeteria. By eating with students and walking the halls, trustees gain an energized, firsthand perspective of the campus climate. This "ground-level" insight, paired with high-level data, allows a board to lead with both empathy and evidence, ensuring the university doesn't just survive, but thrives.
Episode 65 Transcript
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Elliot Felix: What role do you think boards can play in student success?
Drumm: From a student success perspective, they should be monitoring the numbers that indicate student success, graduation rates, persistence rates, job placement rates and even to some degree, what are the salaries that students are making when they graduate out of programs. The bottom line is a student who has invested money in going to this institution better off than they would be had they not come. Do they have a job? One of the big challenges right now is that students are going through, they're investing all this money in their education and they're not finding good jobs. Higher paying jobs until into their early thirties. Yes, unemployment is very low, but are students being trained properly to enter the job market?
Elliot Felix: Right, you don't want, you don't want underemployment either.
Drumm: Exactly, underemployment is very bad. And so with this, boards should be asking the tough questions are we preparing students for their careers? What are the things that we need to be focusing on? Are you focusing? What's the data? Without getting into the micromanaging of telling them how to do it.
Elliot Felix: Right. So setting and monitoring metrics which I always think of metrics as like goals in disguise because those are effectively the targets people are looking to hit And you mentioned graduation retention career placement salary, which gets to roi and payback and so forth and then asking the tough questions to prompt the administration and hold them accountable.
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Elliot Felix: What role do you think boards can play in student success?
Drumm: From a student success perspective, they should be monitoring the numbers that indicate student success, graduation rates, persistence rates, job placement rates and even to some degree, what are the salaries that students are making when they graduate out of programs. The bottom line is a student who has invested money in going to this institution better off than they would be had they not come. Do they have a job? One of the big challenges right now is that students are going through, they're investing all this money in their education and they're not finding good jobs. Higher paying jobs until into their early thirties. Yes, unemployment is very low, but are students being trained properly to enter the job market?
Elliot Felix: Right, you don't want, you don't want underemployment either.
Drumm: Exactly, underemployment is very bad. And so with this, boards should be asking the tough questions are we preparing students for their careers? What are the things that we need to be focusing on? Are you focusing? What's the data? Without getting into the micromanaging of telling them how to do it.
Elliot Felix: Right. So setting and monitoring metrics which I always think of metrics as like goals in disguise because those are effectively the targets people are looking to hit And you mentioned graduation retention career placement salary, which gets to roi and payback and so forth and then asking the tough questions to prompt the administration and hold them accountable.
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Drumm: The board's role is really to think strategically, regularly assess what's working, what isn't, mandate rigorous strategic planning process that's tied to budget allocations, setting goals for the institution that the administration needs to do. And then really focus on how the board can help the president and his or her administration. So, It's the board's role to think strategically, and that doesn't mean that the administration doesn't do that, but they should be working in partnership. The president and his or her administration develops and faithfully implements the strategies and policies that the boards approve, and the two of them should be working collegially with each other.
Drumm: A lot of times boards can bring in a different perspective as to where industry is going. When we're doing planning with an institution, we call this future environmental scanning, which looks over Multiple areas and kind of plans where the industries are going. If you think about football or soccer. If you think about hockey, you never throw the ball or push the puck to where the player is. You want to push the puck out of the football to where the player is going to be. Higher Ed needs to do that as well. And boards should be asking administrations. Where are industries going? We have a nursing degree here. Is it still relevant? Is it going to still be relevant in five in 10 years? Because it takes a while to build up a new program. AI is a great example of this.
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Elliot Felix: I'm interested in your take on what's changing the way boards work. Are boards functioning today the way they did 5, 10, 20 years ago? Or is it, what's the same, what's different?
Drumm: In a lot of ways they are functioning the same and in a lot of ways they are different. You're seeing boards coming out with dashboards where they've got clear ability to monitor outcomes these are, this is a great use of technology, which really helps folks. The other thing that I'm really liking that I'm seeing with boards is I'm starting to see a greater diversity. And when I say diversity, I don't necessarily mean demographics, racial diversity, et cetera. Those are things Real hot buttons when it comes to higher education, especially with the politicalization of higher ed. When I say diversity, I look at it from a education, from an experience. Not everyone can see things the same way. We all see things differently, and by looking at and having boards with different perspectives on how students are acting, how they're attaining their objectives it gives you a fuller perspective on how an institution is doing.
Elliot Felix: And I think you mentioned as an aside, but the politicization of higher ed is certainly a change. There's a real trend in terms of institutional advancement moving from individual donors to more corporate foundation, and mega donors. Do you see that showing up with boards? Are the mega donors often board members?
Drumm: They can be and sometimes they are sometimes they're not when you get a donor on a board you have to be very careful that the donor's interests don't override the best decisions. Multiple times, whether it be in higher ed, whether it be in political campaigns if you've got a lot of money, you can have influence on a political campaign, potentially on a board at a, at an institution, and you have to be very careful that you're still Following your fiduciary duties and making sure that you're acting in the best interest of the institution and not necessarily in the best interest of the donor.
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Elliot Felix: Well, any final advice for board members? If for the board members that are listening or, future board members on how they can really best fulfill their role and enable student success.
Drumm: Yes, one institution I worked with was not really in touch with their students. They would come in, they would have their nice catered lunch and the board room and a lot of great camaraderie. The board chair, the new board chair took over and said, we're going to eat in the cafeteria with the students. Every time we have a board meeting, it was such an incredible way for them to get in touch with the students, get energized and really hear what the students think about the institution. That's just one example of how board members can and should stay in touch with who's using their product.
Elliot Felix: That's really great. Great advice. I'm on the board of MCAD, the Minneapolis College of Art and Design here in Minneapolis. And I co chair the student experience committee this year we're really focusing on the on campus experience. So one time our committee did a tour of the dorm and the next time, student services and then the last meeting was actually in the, in the cafeteria eating, going through the same line and everything. And it was really it was enlightening so I love that suggestion, and I'm personally trying to walk that talk.
Drumm: Well, keep a pulse on what's going on, not only at the university, your job is to hold the president accountable, approve the budget, oversight, set goals, objectives, but also keep a pulse on what's going on. When your graduates get out into the marketplace, are they doing well? Are you doing alumni surveys? That's a great way for administration to find out what's going on with their graduates. It's not just a, Hey, you're graduated. Now you can help pay us a little more money by donations. But that information should be coming to the board to give the board a sense of: Are the graduates being successful? If they are, great. What are we doing that's helping them be so successful? If not, why not? What do we need to change? Because those alumni surveys can give you incredible information about how your graduates are doing.