The current crisis
Colleges and universities are under unprecedented financial stress as they face declines in tuition, lost auxiliary revenues, significant state budget cuts, and increased costs due to COVID response. While these challenges were exacerbated by the pandemic, many are long-standing trends. The expected decline in the number of eighteen-year olds, the growing gap between median family incomes and rising tuition, and state disinvestment in public higher education mean that even post-pandemic (whenever that may be) college and university budgets are not likely to return to what they looked like before Spring 2020.
In the last recession, many institutions made significant (but temporary) administrative cuts and then pursued enrollment growth and price increases. That strategy is untenable for most institutions today.
A more comprehensive approach to short-, medium- and long-term financial sustainability planning with a focus on the academic enterprise is essential and urgent.
In this two-minute video, EAB expert David Attis outlines how higher ed leaders can flip their way of thinking about cost-cutting and university spending trends to make sure their institutions emerge from the COVID-19 pandemic prepared to execute their mission and strategic goals.
The leadership challenge
Addressing fundamental financial issues is challenging even in the best of times, but in the middle of the current crisis it is nearly impossible to do on your own. Few administrators have ever faced financial adjustments of this magnitude before. While many leaders may have a toolkit to manage 5 to 10% cuts, an entirely different set of strategies is required to tackle 15 to 30% cuts. Long-standing questions about the drivers of academic costs and revenues must be answered, and near-term decisions must be linked to a clear and compelling vision for the institution’s future.
Introducing EAB’s financial sustainability collaborative
EAB has spent the past fifteen years forging and finding over 8,500 best practices in areas such as recruiting, retention, budget models, new program launch, academic program assessment, and academic reorganization. We are bringing together this depth of knowledge and expertise to a new partner experience, the Financial Sustainability Collaborative.
The Collaborative focuses your institution on four key drivers of academic costs and revenues and helps you build a strong plan and a transparent process for achieving financial sustainability.
Four key drivers of academic revenues and costs
Realizing Academic Efficiencies
Prioritizing Academic Programs
Improving Retention and Persistence
Developing New Programs to Reach New Students
Interested in participating in the collaborative? Email FSE@eab.com to learn more.
We believe in the power of bringing partners together
Collaborative participants will learn best practices, share their progress and roadblocks, receive advice from each other, and benefit from coaching from EAB expert advisors.
We believe the most difficult strategic decisions must be made by you
We believe difficult tradeoffs and strategic investment decisions must be made by the judgement of your institutional leaders based on your mission and values and in consultation with your faculty and other stakeholders. Our role is to help you identify the best options, assess their likely implications, and facilitate a transparent process that will build consensus on a way forward.
We believe in a long-term partnership
In some ways, creating an initial set of recommendations is the easy part. Implementing change over the next three to five years is the bigger challenge. That’s why we’ve adopted a long-term support model rather than a one-off engagement. We can help you make sure that your plan is implemented and its full impact achieved. Through detailed action and accountability plans and regular check ins with your EAB strategic leader and expert advisors, we will support your key strategic initiatives through to completion. We are in this with you for the long-term as a trusted partner, not just for a single difficult decision during a crisis.
The ultimate objective is to help you attain stability AND set you on a path of continuous performance review and improvement so that you can avoid the kinds of painful cuts that many institutions now face.
- Estimate achievable targets for revenue growth and cost savings
- Communicate external and internal challenges in a clear and compelling way to stakeholders
- Identify the main drivers of performance in enrollment, retention, new program launch, academic efficiency, and instructional productivity
- Quantify the implications of different options to help you assess tradeoffs
- Every participant will create an Academic Opportunity Assessment that identifies the most promising options for your institution
- Every participant will develop a prioritization rubric to identify programs that merit continued investment, revitalization, or possible discontinuance
- Within 6 months of kick-off, every participant receives a Plan of Action and Accountability to guide implementation of the selected recommendations and approaches