The current business model of colleges and universities is not going to last much longer under recent financial pressures, a new Kaufman Hall survey found.
According to the 2019 CFO Outlook: Performance Management Trends and Priorities in Higher Education, 66 percent of higher education finance professionals believe that the business model followed by their institutions will not be sustainable for the next five to 10 years.
When it comes to listing the top five challenges faced by colleges, 51 percent of professionals cite financial resources as their major concern, 14 percent cite vision and strategy, 12 percent cite information data and technology, another 12 percent cite internal politics, and 11 percent attribute lack of defined processes as a major challenge.
“The pressures facing institutions of higher learning today are not temporary problems or something their leaders can try to ‘ride out’ until things ‘get back to normal,'” Tony Ard, vice president of higher education for Kaufman Hall said.
“What we’re seeing now is likely the new normal. Finance leaders will need to partner with their administrative and academic leadership to manage costs and seek new forms of revenue. Improved use of data will be critical in helping them steer their institutions through the difficult years ahead.”
Most of the professionals in the survey were less optimistic about adopting new strategies and plans resulting from a change in their business models. Only 18 percent of finance professionals and 36 percent of non-finance professionals were very confident in their teams’ abilities to adjust, the survey reported.
Many professionals also reported facing various challenges when it comes to financial reporting. 70 percent said that they need better dashboards and visualizations, and 57 percent cited a need for access to clean, consistent, and trusted data.
The report was compiled after surveying more than 250 finance and non-finance professionals from different higher education institutions in September and October 2018.
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