I totally agree with you on the importance of educating chapters fuly about how the system works. I think 99% of the issues we had in the first year of using them resulted from the chapters not understanding how it worked and not having it explained to them well enough.
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"Remember that apathy has no place in our Sorority." - Kelly Jo Karnes, Pi
Using Flex Lists allow for adjustments to the return rates in real time - as gatordeltapgh mentioned to take into account the cyclical nature of recruiting strength seen on campuses. Especially now - as RFM is allowing more chapters the chance to pledge Quota, these chapters are becoming stronger recruiters. So they might not need all of the PNMs that have accepted their invitations.
And having PNMs flexed on or off does NOT necessarily indicate a change in your chapter's performance. It is always done by looking at retention and other considerations as a whole. Flexing on and off affects everyone, and it's always done in a way to give PNMs and chapters the best options possible.