New Trends Equal Success for Higher Education
April 15, 2021
Bradley University on Stable Financial Footing Thanks in Part to New Trends in Higher Education
Many industries are slow to make change, and higher education is one of the biggest offenders. Significant changes in how we do business are needed if we want to survive the many challenges that lie ahead. A massive shift in demographics, continued fallout from the COVID-19 pandemic and a change in how society feels about the industry are just a few of the challenges. If institutions want to thrive in this new arena, they need to change the current business model.
Among the developing trends is the hiring of C-suite personnel from outside the academy. Sheryl Cox joined Bradley University as CFO with a background in private equity and other senior corporate roles. The university’s president, Stephen Standifird, sees her corporate experience as bringing positive change due to new ways of thinking. He also believes Cox’s optimism will help Bradley adapt to the shifts happening in higher education.
“Sheryl is able to help us make a fundamental change in how we operate because she looks at it from a totally different perspective,” he said. “She isn’t used to the bureaucratic red tape we face in higher ed, so she doesn’t hesitate to make or suggest changes. She’s used to working at a much faster speed, which means she can help us pivot much more quickly.”
Another example of innovation is incentive-based budgeting, used by a handful of institutions including Bradley, Purdue University and several campuses within the University of Colorado and University of Wisconsin systems. This method is a strategic opportunity to strengthen the organization through win-win opportunities and outcomes for all students.
Under this budget approach, academic colleges are referred to as revenue centers, with a large portion of the revenue and support costs assigned to them. Designed to empower academic organizations with the benefit and responsibility of greater financial stewardship, the model leads to more informed decision-making and better results for the entire university.
Institutions looking at different or nontraditional ways of improving operations will see success, while those that don’t may struggle — or worse — cease to exist within a few years.
Bradley University, like many other U.S. institutions, has dealt with a significant budget deficit due to declining enrollment and other factors. As of April 2020, the university faced an estimated operating deficit nearing $10 million. By the end of 2020, the estimated operating deficit was cut in half through detailed financial planning and cost containment.
Today, the university’s finances are immensely improved, with an expected operating surplus for the fiscal year 2023. In addition, Bradley’s manageable endowment assets have grown more than 30% in the past five years to $350 million.
How did Bradley cut the deficit during a pandemic and a time of declining enrollments? By being financially disciplined, adapting to new methods and making strategic investments. Current and ongoing investments include:
- Strategic Planning — Develop a new strategic plan aligned with Bradley’s prevailing mission that will set a vision designed to meet the dynamic landscape of higher education over the next three to five years;
- Diversity, Equity and Inclusion — Hire a vice president to oversee these efforts and develop an even more inclusive campus;
- Administration Organization Transformation — Create process efficiencies and increase effectiveness throughout the organization;
- New Branding Concept — Update the brand to resonate with prospective students, current students, alumni, staff and faculty;
- Advancement Office Overhaul — Increase alumni and community engagement and boost fundraising five-fold in the next few years.