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A 30-year look back and a glimpse into the future at Stanford

President John Hennessy in his address to the Academic Council on Thursday presented a sweeping overview of the last three decades and set the stage for the future.

In his annual address to the Academic Council, President John Hennessy reviewed three decades of growth and academic preeminence, but cautioned that the university's future growth will need to be strategic and likely more modest. He also said that future expansion is likely to include gradually increasing the number of undergraduates to re-balance the student body and accommodate more high-quality applicants.

L.A. CiceroPresident John Hennessy gives his annual address to the Academic Council

President John Hennessy gives his annual address to the Academic Council on Thursday.

Hennessy attributed Stanford's growth and academic rise over the last three decades to the university's entrepreneurial culture.

"By entrepreneurial culture, I don't mean startups in Silicon Valley," Hennessy said Thursday, speaking to an audience in CEMEX Auditorium at the Knight Management Center. "I mean faculty who are willing to head in new directions, establish new fields and lead in the development of their fields."

Stanford's capacity for growth has been key to allowing that culture to flourish.

"We haven't very often had to make the decision of saying in order to do something new we have to close something down," he said. "We've been able to do that slowly and gracefully within departments and centers and schools where it made sense, but we haven't been under tremendous pressure, because we had the ability to grow with the large campus we were given by the Stanfords, but also because we've been able to generate research funding with federal dollars to allow that to occur."

But in the future, several of those things will change, he said, adding that the physical capacity for growth on the core campus will be more limited, requiring the university to think strategically about how it wants to use the space.

He said research funding will probably grow more slowly in the future, so the university will have to look to other sources for support.

At the conclusion of his 45-minute presentation, he offered an optimistic appraisal of Stanford's ability to meet those challenges.

"In my mind, the secret for Stanford, the key for Stanford going forward will be to develop a vision and set of priorities for the institution that we can talk about to our friends, our donors and our alumni that will compel them to help support that mission through their philanthropic dollars," he said.

"If we do that well, I'm confident that we'll continue to flourish and Stanford will continue to be one of the great universities of the world."

He illustrated his talk, "Stanford: A 30-Year View and Some Implications," with dozens of colorful bar charts that showed various aspects of the university's development from the 1981-82 academic year to the present.

He said that during his 2012 sabbatical, he began reflecting on the university's development and how much it has changed in recent decades.

Hennessy's address focused on five major topics: the faculty and academic programs; students and financial aid; the endowment, revenues and development; facilities; and the Stanford Medical Center, which includes the School of Medicine, Stanford Hospital & Clinics, and Lucile Packard Children's Hospital.

Students and financial aid

Hennessy said the Board of Trustees has begun discussing the possibility of rebalancing the student body with more undergraduates, to get closer to an equal balance between undergraduates and graduate students. He noted that university officials had begun this discussion in 2007, but the economic downturn forced them to put the idea on hold. Now that the university's endowment value is likely to return to what it was prior to the financial crisis, Hennessy said, "we've begun this discussion again."

"Obviously, we are a residential university that takes pride in a four-year undergraduate residential experience," he said. "We couldn't expand the students until we had housing to put them in. We would need to grow the faculty at whatever rate we would need to maintain our student-faculty ratios."

At Stanford today, Hennessy said, 40 percent of students are undergraduates, 50 percent are graduate students and 10 percent are postdoctoral scholars.

"Anybody who walks around the university would recognize that our graduate programs have grown significantly over time," he said.

The number of undergraduates and graduate students was roughly equal in 1981-82 (with 6,590 undergraduates and 6,280 graduate students). Now, graduate students greatly outnumber undergraduates. In 2011-12, there were 6,927 undergraduates and 8,796 graduate students on campus.

With regard to undergraduate student diversity, Hennessy noted that the undergraduate student body has transformed from a majority white population – 71 percent in 1981-82 – to an institution that has no majority.

"It's a real mix that reflects the state and the country we live in now," he said.

Hennessy said one of the reasons Stanford has been able to attract a diverse mix of students from a variety of ethnic and socio-economic groups is the "incredible efforts" the university made to provide financial aid, in particular the undergraduate financial aid program the university established in 2008.

Hennessy said the biggest change in the composition of the graduate student population comes from an increase in the percentage of international students to 33 percent in 2011-12, compared with 20 percent in 1981-82. Achieving racial and ethnic diversity in the graduate student population remains a challenge, he said, noting that there was some growth in the Asian American graduate student population over the last three decades and smaller growth in the number among African Americans and Hispanics.

"Again, this of course bears directly on the issue of faculty diversity, which is why we're putting so much emphasis on the pipeline and on diversity graduate programs, which Vice Provost for Graduate Education Patricia Gumport is working on," he said.

The university may have to bear a larger share of graduate financial aid if federal research funds are reduced, he said.

Faculty

Hennessy said the quality of Stanford's faculty has improved over the last three decades, a fact that he demonstrated with slides showing a list of major awards faculty have won in a dozen categories, and rankings of doctoral programs by the National Research Council and U.S. News and World Report.

He noted that over the course of 30 years, the majority of Stanford's graduate programs have moved from being among the top 10 to within the top 5 in the nation, with many programs number 1 or 2.

He said the age distribution of faculty at Stanford has changed dramatically in recent decades, since the U.S. Congress eliminated the exemption that universities once had to require faculty to retire at age 65. Since then, the median age of faculty has gone up, while the percentage of younger faculty has gone down.

Hennessy said the number of faculty less than 40 years old has dropped from one-third roughly to 21 percent over that period and the median age has shifted up about seven years. He said that if that trend continued, it would be hard for the university to hire younger faculty.

Hennessy said Stanford has engaged in a "long, slow haul" to increase the diversity of the faculty, which was 75 percent white in the 2011-12 academic year, compared with 93 percent white in the 1986-87 academic year.

"This is going to continue to be something that is continuously looked at and worked on by the university," he said.

Finances

Hennessy said that the university's endowment has enjoyed a "very blessed period," over the past three decades.

"The endowment has grown at 6.7 percent above inflation, so that's a stunning growth number," he said. "That gives you something in the range of over 11 percent for the total growth of the endowment on an annual basis, through thick and thin, through multiple financial crises."

He said the biggest change in Stanford's revenue makeup over the last 30 years can be seen in the university's increased reliance on the endowment (which accounted for 21 percent of total revenue in 2010-11, compared with 6 percent in 1981-82) and on medical services (which accounted for 13 percent of total revenue in 2010-11, compared with 5 percent in 1981-82).

In the future, he said, fundraising though the Office of Development will become an even more important source of university funding, Hennessy said.

Facilities

Over the last three decades, much of the campus has been renewed, Hennessy said, with one of the most amazing transformations seen in the Science and Engineering Quad.

"The Science and Engineering Quad actually has both more square footage than the buildings that were in the same region of campus and more open space at the same time," he said. "It has enabled us to add density to the university without destroying what we really treasure about this institution – its great vistas and its open spaces."

Several projects are underway or planned, including the Anderson Collection at Stanford University and the McMurtry Building for the Department of Art and Art History, which will be significant additions to Stanford's expanding "arts district."

Hennessy announced that Stanford has found a donor to restore the Old Chemistry Building and turn it into an undergraduate science center, with classrooms, library and new laboratories.

"That building is an architectural treasure and we're delighted it will be restored," he said.

Hennessy also cited the Stanford Energy System Innovations Project, which will be among the most energy-efficient systems of any major research university in the world when fully implemented.

Medical Center

Hennessy noted that there has been a dramatic rise in hospital revenue over the last 30 years, to $2.5 billion in 2010-11, compared with $468 million in 1981-82. But he noted that the impact of the Affordable Care Act on longer-term hospital revenues is an unknown.

Hennessy heralded the Medical Center Renewal project, which involves renovating and expanding its 1950s-era hospital facilities to accommodate new medical technology, increase capacity needs and meet seismic-safety requirements.

He said it is likely that the current expansion will exhaust the capacity for building on the west side of campus.

"Longer term, we're going to have to think about further expansion of the Medical Center, particularly clinical service, being off campus," he said.