Excellent faculty members. Attractive, functional facilities. Technology that supports learning. Those are just a few of the factors that support your institution’s academic mission. They all cost money, and there’s never enough to do everything you’d like to do.
Effective stewardship of your institution’s resources is an important part of your job — a part you probably weren’t trained for before joining the administration.
Dean & Provost’s Advisory Board members participated in a conference call to share their strategies for a successful budgeting process, in spite of tough fiscal times.
Understand hiring, budgeting formulas
Hiring faculty members is often the most expensive budget decision. But it’s not always as simple as weighing what department chairs want against funds available. Cynthia Worthen recently took a job as dean of academic affairs at The Chicago School of Professional Psychology in California. One of her first challenges in the budgeting process was understanding the formulas the institution had in place for hiring faculty members. The budget is based on forecasted new-student enrollment, and if numbers were off for a cohort, that created a ripple effect over several years.
At the University of Florida, which uses responsibility-centered management, the budget cannot vary beyond a certain range based on enrollment, said Lucinda Lavelli, dean of the College of Fine Arts. The constraints created by the budget model have impacted decisions about academic planning. For example, officials had to find ways to teach larger sections in courses for nonmajors.
Both Centre College and Hofstra University use a five-year budget model. At Centre, once utilities and other set costs are accounted for, there’s not a lot officials can change, said Stephanie Fabritius, vice president for academic affairs and dean of the college. At Hofstra, labor agreements define much of the budget, said Herman Berliner, provost and senior vice president for academic affairs. Changes in the enrollment and in the economy can impact budgeting, however.
Marsha Kelliher, dean of the Sigmund Weis School of Business at Susquehanna University, also said the economy impacts hiring. But day-to-day operations are funded by the endowment, so unless a real crisis occurs, the budget isn’t affected much.
Collaborate with key campus officials
The advisory board members agreed that regular conversations with others on campus can make the budget process go more smoothly.
Maria Vallejo, campus provost at Palm Beach State College, Lake Worth Campus, meets monthly with the chief financial officer for the district, the vice president for student services for the district, and the cabinet. They have been discussing budgets regularly for 10 years, so they have good relationships. “We can barter and challenge each other,” she said.
Those monthly meetings have been so valuable that when someone new comes onto the staff, Vallejo works to schedule the meetings right away.
Worthen scheduled a meeting with her institution’s CFO to build a relationship to help the process go smoothly. At a previous institution, Worthen and her institution’s CFO both commuted on the same public transportation. That informal connection helped them get to know each other and work together more effectively.
Berliner meets with the CFO and other officials every week. He also talks to deans and chairs and uses the shared governance system to communicate about the budget. Being proactive about the budget is important because searches to fill faculty openings need to start early or opportunities will be missed, he said.
Communicate with faculty, division administrators
Letting faculty and staff members and unit administrators know how budget decisions are made and the status of budget discussions helps lessen fears people might have and encourages them to consider needs beyond their own.
At Palm Beach State, people know that if they really need money, they will get it, Vallejo said. Because they are confident their needs will be met, they are more likely to say, “We could wait another year for this.”
But if divisions don’t spend the money that’s allocated to them, they lose it, she said. At a certain point in the fiscal year, officials start checking to make sure the divisions have spent a certain percentage of their budget.
At Palm Beach State, the budgeting process follows a predetermined calendar so people know what to expect. Each month, Vallejo hosts monthly coffee hours. Anyone can come, and the events provide a forum for sharing information about the campus. Plus, attendees can get to know each other. “People will never get to know each other unless there are avenues,” she said.
In Lavelli’s college, all the directors see the budget. Some years, some get more money than others, but that could change the next year based on needs. Lavelli tries to instill in the leadership team members that they serve as leadership for the college and not just for their unit.
Members of the campus community need to hear that functions across campus are interconnected. What happens in one unit affects everything else on campus. For example, what happens in student services impacts academics, Vallejo said.
During the recession, Fabritius and other officials at Centre sat in the cafeteria with a big sign encouraging people to talk to them about the budget and come forward with ideas. Faculty, staff and students all contributed. The discussions had the positive effect of making people realize the interconnections between the economy, enrollment and the budget.
The bottom line…
Keep these tips in mind for effective budgeting:
- Take time to understand the formulas that impact your budget, especially if you’re in a new position.
- Communicate regularly with your chief financial officer and other critical campus officials.
- Be transparent about budgeting. Educate your campus community about the process and its results.