It is argued that colleges and universities can use direct allocation costing to provide quantitative information needed for decision making. This method of analysis requires institutions to modify traditional ideas of costing, looking to the private sector for examples of accurate costing techniques. (MSE)

Strategic planning enables colleges to direct discretionary dollars into high-impact areas that can enhance critical core activities, improving output. When the institution can disinvest financial resources in weak or noncritical core areas and redirect them through careful budgeting, it improves its chances for success. (MSE)

Outdated and cumbersome administrative processes and technology at the University of Missouri prompted use of business process reengineering (BPR) techniques to bring about change. BPR helped quantify staff resources and costs associated with major administrative processes, know where those processes were occurring, and understand opportunities…

To meet demand for increased funding, in a period of probable declining investment returns, colleges and universities must fine-tune their asset suballocations to enhance returns. While the institution should adhere to major asset allocation classes, there can be much flexibility, and enhanced return, in shifting suballocations within the major…

This article is an excerpt from the chapter titled "Information Technology and Systems" in the sixth edition of "College and University Business Administration." Issues addressed include competition for skilled IT staff, life-cycling budgeting and replacement, measuring and valuing the IT investment, funding mechanisms, and standards and technical…

Five strategies for realistic deficit management in the college or university during fiscal stress are examined: (1) comprehensive strategic and operational budget planning; (2) examination of tenure-stream faculty positions; (3) program review and evaluation; (4) self-supporting auxiliary and service units; and (5) increased flexibility in use of…

A group of 17 independent colleges and universities in Virginia combine their long distance telephone traffic and network services for an expected savings of $4.65 million over 3 years. The 12-institution consortium that negotiated the plan prioritized service and system criteria and solicited bids from long distance carriers. (MSE)

An economic impact study of Ohio's public universities and medical schools provides documentation that state appropriations yield financial returns higher than virtually any alternative use of state funds, in the form of economic growth and increased opportunity for financial security. Some significant findings of the report are summarized here.…

Although religious beliefs of college students opposing abortion may be sincere, they must yield to the institution's need to decide what programs will serve the entire student body's needs. When the Supreme Court rules on a challenge to allocation of mandatory student fees, it will apply principles of religious freedom. (MSE)

Successful college and university investments hinge on an asset allocation strategy capable of meeting the institution's needs for income and growth in principal at the lowest possible risk. Periodic adjustments must be made when there is a shift in the institution's risk tolerance, modification in need for income distribution, and changes in…

The principles of ratio analysis can help measure use of financial resources to achieve college mission by quantifying status, sources, and use of resources and the institution's relative ability to repay current and future debt. Business officers and boards can use these measures to measure institutional performance; ratios can also help focus…

Results of a national survey of college and university fiscal 1995 endowment investments found the average nominal performance (15.5%) far surpassing the previous year's return (2.9%) and higher even than double-digit returns in fiscal 1993 and 1994. Overall investment pool allocations are charted, and 460 institutions are ranked by endowment…

For the College of Mt. Saint Joseph (Ohio) to remain financially sound and to inform decisions about resources and academic programs, college leaders needed to understand instructional costs: costs per credit hour; how these vary by department, program; and meaningful ratios of revenues to costs. A system of differential analysis was developed to…

Prairie View A&M University's (Texas) experiences are offered as lessons in how to establish institutional priorities and procedures for retrenchment. Thirty-one specific cost-reduction strategies and policy changes are presented, and the evolution of a formal, institutionalized budget process, nonexistent until fiscal year 1991, is described.…

Changing times, public attitudes, and political strategies have shifted the approach to leadership in higher education from an academic to a business perspective. Colleges and universities are being asked to restructure, reinvent themselves, and rightsize, but none of these will work unless more attention is paid to the problem of revenue. (MSE)