Setting the Pace in Indy
Indiana’s capital city hosted the NACUBO 2013 Annual Meeting, where business officers completed some victory laps in learning about the innovations vital to today’s higher education institutions.
Good Governance Needed
In these sessions, attendees considered how they can redesign and implement new business practices, overcome resistance to institutional change, and cultivate efficiency.
A Strategy for Stability
For Matt Easdown, deputy chief financial officer and director of corporate finance at the University of Sydney, Australia, financial sustainability “can mean the gradual adjustment to a changing landscape or a sudden lurch in response to a major policy reversal.” It was the latter for Easdown, when in 2011 the Australian government no longer provided “funding clusters” to support much of the cost of education delivery, and it removed student quotas.
In the session “Using Data Analytics to Achieve Financial Stability and Transparency,” Easdown and copresenter Anthony Pember, chief executive officer, Pilbara Group Inc., explained the process of creating a new strategic plan to control costs and keep budgets balanced.
“We had to break away from the old funding models,” explained Easdown, “and make each of our 16 entities [faculties] responsible for its own numbers.” To accomplish that, the financial staff had to unbundle established—and often “covert”—arrangements that had made it difficult to reflect the true costs associated with various programs.
By analyzing the related data, explained Easdown and Pember, the business office was able to establish that a number of faculties were not self-sustaining, many were financially troubled, and cross-subsidies between faculties masked further budget issues.
“We’ve now moved to a new economic model,” explained Easdown, “in which we’ve established business centers based on retention of direct revenues and allocation of central services based on consumption. The idea is that over the next five to seven years schools will learn how to better manage their budgets so that they eventually work their way to financial sustainability.”
NACUBO 2013 Annual Meeting – Published in September 2013 Issue of Business Officer Magazine
About the University of Sydney:
Founded in 1850 the University of Sydney has 50,000 students and $1.6 billion in annual turnover as well as 16 Faculties with 70 schools.