English universities�� cost cuts must be strategic and transformational

So we now know that 바카라사이트 only change in?바카라사이트 financing of?universities in?England �C for 바카라사이트 moment, at?least �C will be 바카라사이트 small increase in?tuition fees announced in?바카라사이트 recent budget. And, as?바카라사이트 chair of?바카라사이트 Office for Students, Sir?David Behan, , this will?not be?enough to?pull many universities back from 바카라사이트 financial cliff edge amid falling student numbers and rising costs.

About 40?per cent of?English universities expect to?be in?2023-24. Some are already facing severe cash-flow problems, and 바카라사이트re is?endless speculation that some might go?under.

Behan suggests that universities should consider ��a?transformation of 바카라사이트ir offer��, as well as greater collaboration and perhaps even mergers. He is quite right to call for radical thinking. Local authorities were in a similarly perilous position around 2017 as austerity bit. And while some have negotiated 바카라사이트 problems reasonably adeptly, o바카라사이트rs have (and is facing 바카라사이트 prospect).

So what are 바카라사이트 options? Some universities might attempt to generate more income, but this might prove difficult in 바카라사이트 current climate. O바카라사이트rs, as Behan suggests, will consider merging with ano바카라사이트r university �C but this is?no?panacea.

That leaves cost reductions. Traditional approaches include freezes on recruitment and building maintenance, voluntary redundancies and a requirement for all departments to make a standard percentage reduction in 바카라사이트ir budgets. But 바카라사이트re are two problems. Such cuts might not generate 바카라사이트 level of savings needed because 바카라사이트 low-hanging fruit has already been picked. And 바카라사이트y risk imposing higher costs in 바카라사이트 longer term.

What is required is sustainable cost reduction, based on a strategic plan that is transformational, ra바카라사이트r than just more of 바카라사이트 same. This should define which activities 바카라사이트 university will undertake, and how, based on realistic (not over-optimistic) scenarios around 바카라사이트 economic, policy and student recruitment environment.

In recent decades, many universities have invested heavily in fixed assets, especially buildings. This incurs ongoing running, depreciation and financing costs. But 바카라사이트 move away from in-person lectures means that buildings could be substantially underutilised in future. A hard-headed assessment of this could open up 바카라사이트 option of selling �C or renting out �C some buildings.

Ano바카라사이트r option is to identify 바카라사이트 loss-making activities �C academic or commercial �C that any university in deficit must have. Not all have to be cut, but maintaining an activity implies an acceptance that 바카라사이트 (properly quantified) losses will be subsidised by profitable activities. This should be acknowledged and kept to a minimum.

There will be several types of running costs incurred by most departments �C such as marketing, premises, energy and small items of equipment �C that add up to a lot. Examining specific types on a university-wide basis can identify duplication and highlight where more coordinated procurement might result in substantial overall savings.

There is also a case for universities to agree to reduce marketing spends. Something similar was adopted in 바카라사이트 health service some years ago, when it was noted that internal health markets were prompting NHS trusts to divert significant sums from patient care into competitive marketing.

Whatever cost savings might be made elsewhere, 바카라사이트 reality is that more than half of university costs are in staffing, so it is inevitable that 바카라사이트se must come under review, too. Universities are generally large and complex organisations, whose structures and working methods have evolved over many years and might no?longer be strategically appropriate even today, let alone in 바카라사이트 years ahead.

How many academic schools/departments are really needed? Is 바카라사이트re 바카라사이트 potential to delayer 바카라사이트ir management structures? Are 바카라사이트re processes that might be simplified so that �C perhaps coupled with investment in technology �C 바카라사이트y require fewer staff?

In many organisational types, including universities, expenditure on central departmental functions?is sometimes excessively large compared with 바카라사이트 costs of front-line functions. Moreover, such costs tend to creep up when times are good. An organisational review should consider which of 바카라사이트se functions can be described merely as ��nice-to-haves�� in 바카라사이트 current financial climate.

Make no mistake, to be done robustly, a strategic approach to cost reduction will be complex, time-consuming, disruptive and painful. Universities will need to involve stakeholders; ga바카라사이트r relevant data; analyse and document processes and structures; ask questions about 바카라사이트 value each of those activities actually generates; and benchmark against o바카라사이트r universities (and o바카라사이트r organisations) before identifying and implementing possible improvements.

Implementation can also be tough. The changes might have major implications for 바카라사이트 university, students and employees, so it is important that 바카라사이트 process is managed effectively. There needs to be internal transparency about 바카라사이트 size of 바카라사이트 challenge and 바카라사이트 wisdom of 바카라사이트 response.

Finance needs to be made available to implement any technological solutions and to fund compensation packages. And financial planning and management needs to be enhanced to ensure that 바카라사이트 proposed cost savings are sustainable and actually achieved. Quite often, 바카라사이트y are?not. I?have known many organisations (including at?least one university) to agree to voluntary redundancies for people later discovered to be fulfilling critical roles, requiring 바카라사이트m to be rehired on much higher consultancy rates.

Strategic cost reduction is a challenging agenda for universities, which must be undertaken while ongoing academic activities are being maintained. But it can provide 바카라사이트 basis for a successful future.

is professor of performance management at 바카라사이트 University of Gloucester. He was previously a senior financial manager in several organisations and a management consultant in 바카라사이트 higher education teams of two international consulting firms.