San Diego, California (PRWEB) September 19, 2014
With the new fiscal year starting for many colleges and universities and in light of lower-than-expected fall enrollments (1), chief financial officers and presidents are looking for ways to balance their budgets.
Dr. Michael K. Clifford, a veteran in the online education industry, may have the answer. Clifford announced today that his non-profit, SignificantSystems (significantsystems.org), would begin providing its online education expertise, or "money, marketing, and management" as he calls it, to institutions in need.
Most chief financial officers “lack confidence in the sustainability of their business model” over the next three to seven years, according to an article in Inside Higher Education on July 18, 2014 (2).
“Those that initiate discussions regarding cost-saving measures ignite indignation, lack of understanding and sometimes all-out war from all areas of their institution,” said Clifford. “But the faculty is not to blame as this is a leadership deficiency.”
There is the ongoing “dynamic tension” between the business world and the academic world. However, "many schools will begin to experience forced cutbacks, which will have a significant impact on the compensation packages and job security of faculty and staff alike," said Clifford. "What can be done?"
Clifford added that "these market forces will drive rapid and dramatic change. If leadership doesn’t get ahead of this wave, they will be crushed. This forced reality is painful, damaging to the institution and totally avoidable if leadership approaches these issues correctly. These budget changes should have been instituted by the collaborative effort to control costs…but first:
“Our approach is to put together a collaborative group of the institution’s leadership to completely focus on increasing the top-line revenue of the organization. Each department head should be assisted by a sophisticated financial analyst to create their own operating budget as if they were a separate business.
“Each department head should be asked to create a marketing plan in conjunction with one of the many marketing experts that can be made available to them to increase top-line revenue for their department by 15 percent per year for the next five years.
“By focusing on increasing top-line revenue growth, leadership sets the stage for a positive, collaborative discussion about creating additional surplus without addressing the more important--yet sometimes draconian--budget cuts.”
Clifford added that "presidents and chief financial officers, along with their provosts, that can focus their institution on top-line revenue growth begin an important first step in the cultural change of creating a sustainable business model.”
He added that a successfully implemented online education platform will yield new questions, such as “What are we going to do with our surplus?”
References:
1. Inside Higher Education, "Nearing the Bottom", May 15, 2014. https://www.insidehighered.com/news/2014/05/15/new-data-show-slowing-national-enrollment-decline
2. Inside Higher Education, "Sustainability, Divestment and Debt: A Survey of Business Officers", July 18, 2014. https://www.insidehighered.com/news/survey/sustainability-divestment-and-debt-survey-business-officers