Aligning Institutional Budget Models to Strategic Goals

Download the executive brief for an overview of the three imperatives of budget model redesign. To dive deeper into 13 budget model decision points, download the full report.

Persistent inflation rates, rising material and utility costs, wage pressures, and deferred maintenance are increasing overall operational costs in higher ed. Institutions need to rethink their budget models to achieve long-term financial sustainability.

Most models tend to be either centralized or decentralized, and while neither model is perfect, higher ed leaders are increasingly adopting hybrid models that utilize the best of both worlds. The right budget models help institutions respond to immediate pressures and proactively prepare for future financial challenges.

This brief discusses three ways business executives should focus their redesign efforts to have the most impactful budget model elements and align their model to their strategic goals:

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  Create unit-level financial accountability

  Allocate some revenues and costs to align unit-level operational responsibility with institution-wide financial imperatives

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  Incorporate institutional strategic goals

  Align stakeholders with strategic goals through performance funding, seed funding, and governance policies

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  Preserve mission-critical activities

  Protect mission-critical but financially dependent units from harm in the new model to protect the institution’s brand, and build central reserves for major investments

Download the executive brief to review these three focus areas in more detail.

Download the Brief

More on this topic

This updated 2024 executive brief is part of a larger study on aligning budget models to your institution’s strategic goals. The report offers executive-level decision points to ensure impact on cost, growth, and strategy To read the full study and explore recommended strategies in-depth, download the report below.

Download the Full Report