Over the past decade, scholarships have become a critical component of a student's overall financial aid package. According to one report, more than $7 billion in scholarships and grants are awarded each year. Scholarships can come in many forms. Some scholarships are publicly available, through various websites and products, and are independent of the enrolling institution. These “external scholarships” typically require minimal effort to incorporate into a student’s final award package.
Another significant category of scholarships is institute-funded, often provided by donors who establish criteria and partner with institutional endowments to distribute them to students. These scholarships are fully maintained and processed by an institution. Given the importance of these “institutional scholarships” in making tuition affordable, their distribution places an increased burden on campus financial aid and advancement offices. Scholarship management systems have become critical tools for maintaining, distributing, and prioritizing this source of tuition funding. I've found that there's not a lot of common understanding of what these systems can do and what institutions should look for when considering a system.
Establish Scholarship Rules and Data Maintenance
Institutions have hundreds of institutional scholarships, each with its own specific rules and criteria. These rules can be as simple as a student's major or GPA, or as complex or subjective as scoring an essay explaining why a student should receive the scholarship. Maintaining these scholarships is extremely time-consuming and dependent on individual administrators.
What your system needs:
- Your technology solution should let you modify, add, or remove scholarship rules. Scholarship rules are often kept in disparate systems, Excel, or even on paper, making them labor-intensive to maintain. With an intuitive interface, your system should focus on simplicity, making it easy to load new scholarships or maintain existing ones.
- You need flexibility in the scholarship data you have to maintain. The information and eligibility requirements for each scholarship vary widely, whether it is financial coding, rules, or donor information.
- A key capability to look for is the prioritization or rank of scholarships so you can determine which scholarships are distributed first. Matching students to scholarships requires prioritizing awards to maximize funding, which requires a holistic view of all scholarships.
Streamline the Student Experience
Through my conversations, I have found that the involvement of students in the award process varies wildly. Some institutions automatically consider students for scholarships, while others require lengthy forms that collect information already maintained by the institution (i.e. GPA or major). Ideally, the process would be frictionless for students, with minimal reliance on them.
What your system needs:
- Application forms need to be configurable. This allows institutions to make an application form optional and allows for a "smart" universal application form that leverages existing data. Some forms can be long and confusing as each scholarship may require unique information.
- Easy integration with existing systems is critical. Also, the system has to be designed to be convenient for the student. Students are asked for information that the institution already has due to lack of integration with existing systems or lack of common data models.
Improve Decision Making Through Matching Insights
With scholarship data and student information in the system, the next major step is to quickly match students to scholarships. Typically, this is a manual process, whereas conversations with some institutions have revealed that effective, systematic solutions can increase productivity by more than 50%.
What your system needs:
- Having insights by scholarship, which students match and partially match, is critical. Comparing students and identifying those that match can be a very long and labor-intensive process. That's why features like a “percentage” match by student are a must.
- Your system should provide an analysis of scholarship utilization. Identifying and addressing under-utilized scholarships is challenging, which means lost funding for students year over year. Institutions and donors alike should understand why students are not matching and receive feedback to increase the benefit of the scholarship.
Ensure Excellent Stewardship
Advancement office teams are critical to the overall scholarship management process. They often maintain donor relationships and drive fundraising efforts to increase institutional scholarships. Scholarship management systems should address their needs to enable continued engagement with donors and drive further value.
What your system needs:
- An automated “Thank You” letter workflow improves this task’s completion rate and provides donors insight on the recipients. It also increases donor retention rate, which is paramount.
- Automated reporting on donor impacts revealing donation utilization both by recipient and award value can help with donor conversation and even improve retention rates. Gathering donor impact data from the distribution of scholarships is often a skipped step because of its manual nature.
- Providing advancement offices with secure access to real-time scholarship utilization data enables timely donor conversations and drives a collaborative process across departments. Advancement offices may not see the results of the match until the process is complete and awards have been distributed. This limits their ability to have timely conversations with donors and drives handoffs between departments.
Flexibility, simplicity, and impact are essential when assessing technical scholarship solutions.
A reliable system like Scholarship Magic drives insights and automation, resulting in streamlined processes, enhanced donor engagement, informed decision-making, and long-term financial sustainability. By leveraging such capabilities, institutions can maximize funding opportunities and strengthen relationships within their academic community, ensuring a positive impact for donors, students, and financial aid teams alike.
