Leadership sets the tone.
West Point teaches that lesson. How about business schools and other management training?
If they don't, they should, because it's one of the most vital lessons for a young executive to learn. And for evidence, consider North Dakota State University and its recent audit.
"North Dakota State University spent more than $24,000 on unused hotel rooms and more than $15,000 to send two employees to seminars by motivational speaker Tony Robbins, said an audit released Thursday that echoes a familiar theme about the school's past spending practices," The Associated Press reported.
As the AP notes, the audit "echoes a familiar theme." But that theme remains sobering no matter how many times it's confirmed: Success went to ex-NDSU President Joe Chapman's head, and the result cost Chapman his job, hurt NDSU and the university system -- and, apparently, prompted some subordinates to also behave in high-handed ways.
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The success Chapman inspired was real -- and lasting. It's the positive side of the coin that reads, "Leadership sets the tone." Chapman saw NDSU's potential and inspired others to see it, too. He famously told his deans to take their departments to the next level -- and they did: athletics to Division 1, enrollment to 14,000 and status to a Carnegie Classification of "high research activity."
North Dakota's key policy issue is economic growth. So ,when Chapman steered NDSU to unprecedented growth, he won solid support and even acclaim.
That's where the trouble began: The president's house cost $1.5 million more than expected. Heated sidewalks, automated blinds and outdoor restrooms helped run up the home's costs. Chapman spent $22,000 to charter an aircraft and stay in luxury accommodations to attend President Obama's inauguration.
Chapman resigned in late 2008, and the audits and disclosures -- some also criticizing UND -- that came out since prompted Lloyd Omdahl to start a May 2010 column: "With fiscal affairs amok, North Dakota higher education is experiencing its third major scandal since statehood."
Now comes the latest chapter, an audit that documents NDSU practices such as spending nearly $20,000 on three first-class or business-class plane tickets for overseas trips. At a time when university tuitions are rising faster than inflation, at a time when college administrators justify those tuition hikes by pleading poverty and rising costs, there's no excuse for higher-education employees flying first class on the taxpayers' dime.
It shouldn't have happened at NDSU. The school's policy states "reimbursement will be allowed for the actual cost of tourist or coach fare, purchased at the lowest available rate," the audit said.
But leadership sets the tone, and clearly, Chapman's sense of entitlement filtered down several layers to improperly influence his management staff.
NDSU's current leadership deserves great credit for recognizing this trend and stopping it. "We're not doing business like that anymore," President Dean Bresciani said this past week. "We're setting a higher expectation."
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Unfortunately, the damage is done to higher education's reputation, and key lawmakers have spoken up about it. Now, the question is whether that loss of trust will prompt action by the Legislature, action such as a move to reassert legislative control over the higher education system.
Chapman and NDSU certainly don't deserve all the blame. North Dakota's entire higher education system gained lots of clout over the past 10 years, and more than one administrator was swayed, including at UND.
The key now is for officials to recognize the state's concerns and act on them. Scrupulous fiscal prudence is a great place to start. As governor of Indiana, Mitch Daniels ordered state agencies to reuse the paper clips residents sent in with their tax forms. That's a little thing; but when leaders of any organization make a point of such examples and follow them, those little things can mean a lot.
