The landscape of higher education, once reliably stable, is seeing increased volatility. Changes in funding and budget, as well as scrutiny into how money is spent, puts increased emphasis on doing more with less. Many times, this need for efficiency brings up the topic of proper planning to anticipate expected performance. As the higher education landscape becomes more competitive, universities are measuring performance at an increasingly granular level—not just by school or even an entire department, but down to the course or class level—and having tools and technologies in place to support this insight is essential.
Higher education: A decentralized business
The variety of ways in which a university serves the dual missions of education and research, and the decentralized model under which most institutions operate, pose a unique management challenge. Planning is critical to the success of a university, so how does an administrative team address the disparate needs of each department and handle the complexity of aggregating the pieces?
Historically, universities have used single-purpose planning platforms for the development of an aggregated budget. Individual departments may compile their plans in spreadsheets and input the plan into a homegrown database. The challenge lies in the ability to measure spending throughout the year, as the desired level of detail may not exist in the planning tool (e.g., fund-level detail). To properly manage the various plans across an organization, it’s critical to have a tool that meets the requirements of each, with the flexibility to adapt as these needs evolve. This is where a cloud-based, Connected Planning platform comes into play.
An opportunity for Connected Planning in higher education
The unique challenges facing higher education call for a secure, scalable platform that links data, people, and plans across the institution. Unlike rigid and traditional planning solutions that act as point solutions, a connected platform has the flexibility to serve a variety of user types and use cases.With such a platform, you can streamline the management of a total departmental expense budget. You can integrate plans for all types of employees with HR, from part-time student workers and pooled faculty resources, all the way to tenured professors. And using detailed tuition revenue and financial aid forecasts developed in the enrollment model, each department has an accurate starting point for the revenue side of their budget equation.
Forecasting and actuals reporting: An application programming interface (API) enables you to automate the integration of forecast and actuals reporting with your general ledger tool (i.e., Banner, PeopleSoft, SAP) to pull in actuals that enable real-time forecast updates as the year progresses. By understanding overage projections in the operating budget before they happen, departments can manage their restricted funds more effectively.
Room and board planning: Connect enrollment projections not only to your tuition and financial aid forecasts, but also to room-and-board planning. With advanced insight, facilities managers have a more accurate and unified forecast for pricing, allowing them to meet individual staffing needs at each dorm or dining facility.
Class and course profitability: Plan down to class-level detail within a course to assist in developing course schedules. By understanding historical enrollment trends based on class traits, such as mode of instruction, time of day, or course level, departments are better able to plan a schedule that meets students’ needs while optimizing profitability.
Responsibility Center Management and allocation methodology: The flexibility of a cloud-based planning platform with robust calculation and data crunching capabilities makes modeling and adjusting allocation methodology easy. The budget office can develop any number of allocation methodologies and apply them to previous years to create pro-forma statements and understand how each allocation will affect colleges across the institution. Once cost allocation consensus is reached, they can be tracked on an ongoing basis, facilitating a more RCM-based approach.
Connected Planning across the institution
When your models are flexible and connected, they can easily be configured in a myriad of ways, so an institution can begin wherever the need is most critical, implementing a basic departmental solution and building out ancillary models that support the departmental requirements as needs are identified.
Universities and planning processes must change to keep up with a fast-moving and increasingly digital world. The ability to analyze that change has never been more essential, and a flexible, comprehensive planning platform is best suited to manage that change. As we all know, once something catches on in higher education, it quickly becomes the new gold standard, and Connected Planning is well on its way to becoming that new gold standard in higher education planning.