In the last two Meetup blog posts, we explored ways that IT departments can be a part of overall strategies for advancing the educational and administrative missions of the university by sharing the perspectives of CIO’s and CFO’s from our most recent MeetUp event. This topic has been of interest to our group for the last year, motivating us to search the literature to identify examples of actions undertaken by universities and colleges to increase revenue and/or to reduce costs. We have found numerous examples that we have compiled into a simple database. This blog will be a quick summary of our findings.
First, let us introduce a table that summarizes our findings. We divided institutions into three groups – small colleges, large universities, and consortia of institutions. We then divided innovative actions into those intended to generate new revenue versus those intended to cut costs. The result is a two by three table with several examples of institutional actions in each of the six resulting cells.
Revenue Generation and Cost-Cutting Strategies at Colleges and Universities
Revenue Generation
We found that colleges and universities both large and small are actively engaged in actions to increase revenue. Obviously, many schools are following the tried and true strategy of introducing new programs and today most of these are online or in some type of reduced residency format. We found numerous examples, however, that appeared to us as truly unique. Notable from small colleges were Cal Poly San Luis Obispo’s development of an “innovation sandbox” providing a space for students to use state-of-the-art equipment to develop experimental programs and Berea College’s craft programs creating sellable goods through a student-run organization. Not surprisingly, revenue generation projects became both larger and more complex at large universities. Both Arizona State University and the University of Central Florida have developed partnerships with large multinational corporations whereby corporate employees enroll in university degree programs at discounted rates that are paid by the corporations. Metropolitan State University in Denver has converted unused space into a restaurant open to the public (run by student personnel) and the basement of this building is being leased to local micro-breweries. Most notably, Purdue University has created an income sharing program whereby donors cover student tuition, fees, and living costs in exchange for a proportion of the students’ earnings during his or her career. Interestingly, we did not find any examples of revenue-generating strategies being pursued by institutional consortia.
Cost Reduction
Again, we found many examples of innovative strategies for cost reductions. Administrative reorganizations have helped many small colleges reduce costs where administrative units were so small that efficiencies were difficult to realize (see, for example, College of the Holy Cross). Similarly, reducing carbon footprints through wind and solar power has allowed many small colleges not only to cut their energy costs (and to promote their environmental consciousness) but, in some cases, to actually sell electricity back to the grid (Butte College & Fairfield University). Large university strategies included leasing university parking facilities to a private firm (Ohio State University) and eliminating cafeteria trays (North Carolina State University). Institutional consortia are ideally suited for cost reduction strategies. Notable examples are “virtual swim meets” (Dickenson College), Ed Health (a consortium focused on the purchase and management of health insurance by Bentley University, Regis College, Lasell University, et al.), and even broader sharing of services (Colleges of the Fenway).
Conclusion
These are just a few of the examples that we found of strategies for revenue generation and cost reduction. It is clear that colleges and universities are aggressively engaged in developing strategies to increase the efficiency and effectiveness of their organizations in ways that go beyond the normal education and research programs that usually typify their existence.
In collaboration with Curry College, our upcoming Meetup event on September 27th is focused on showcasing the many ways in which A.I. is impacting and will continue to impact Higher Ed in the future. We will be joined by a series of presenters, ranging from artificial intelligence experts to Higher Ed CIOs, to discuss some of the projects and tech that they’re utilizing to help achieve institutional goals. RSVP now to secure your spot!
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