IIn plain terms, I define academic cost stewardship as a deliberate effort to understand all aspects of academic finances and effectively manage their practice to responsibly deliver education to learners. This can be accomplished by means of collaborations among people with important roles in an institution, including and especially the faculty, and support from decision-making tools designed to support the process. The concept of academic cost stewardship emphasizes the shared responsibility of faculty and administrators to use transparent practices to make informed strategic decisions regarding budget allocations, resource utilization, and cost-saving measures. At first glance, one might think that this issue is related solely to curriculum delivery and faculty effort and should be addressed within the boundaries of the academic affairs division. However, while this division plays a pivotal role, good stewardship requires meaningful collaboration across all functional units of a college or university in order to achieve long-term success.

Effective academic cost stewardship requires a comprehensive collaborative effort that encompasses all aspects of academic program delivery, including its costs. This proposed framework is built on the foundational principles of shared governance, collaboration, and transparency. It involves the active participation of various constituents, including faculty, staff, and administrators, in working together to ensure the delivery of high-quality education while simultaneously ensuring fiscal responsibility. The framework must be enhanced by a robust decision-making support tool that integrates data about curriculum planning, coursework delivery, faculty effort, and financial resources to facilitate transparent and data-informed decisions regarding academic programming, resource allocation, and budgeting processes. This dynamic, adaptive framework encourages a culture of cost stewardship, where academic and financial considerations are balanced to meet the evolving needs of students and the broader academic community, ensuring the long-term viability and success of the institution.

Participants in Establishing an Academic Cost Stewardship Culture

As I stated earlier, establishing an academic cost stewardship culture requires a “community” approach to ensure the effort is both effective and sustainable in the future. Based on more than 25 years of experience related to academic program delivery and its costs, I have found that administrators, faculty, and governing boards have vital roles to play in this process.

Administrators: Significant contributions from leaders of multiple administrative units (e.g., director of academic affairs, director of financial planning, head of human resources, registrar) are required for success. Approaching this endeavor in a collaborative manner helps senior administrators and staff, who conduct day-to-day operational activities and implement policies, to develop a common language. This language facilitates discussions that can both improve the quality of academic offerings and optimize the ways in which finite resources are allocated. This guide promotes a collaborative and developmental institutional approach.

Faculty: My experience suggests faculty are key economic stakeholders because most of the revenue at most colleges and universities is generated by the product they oversee and deliver, the curriculum. The revenue is generated through tuition dollars and/or federal or state appropriations, with the credit hours produced often serving as a proxy currency relied upon by the institution. It is not difficult to see that if a college or university were to cut just about any non-academic program (e.g., athletics or a study abroad program), it would continue to exist, but if it were to eliminate its curriculum, it would immediately cease to exist. Therefore, the faculty’s participation in the development of an academic cost stewardship approach is required, since they are the ones who develop, maintain, and deliver the product that students, families, governments, and philanthropic organizations fund.

Governing Boards: In their governing role, college and university boards provide leadership by setting strategic directions, approving policy and strategy decisions, monitoring the organizational performance, and ensuring the overall accountability for the common good and benefit of the institution. Boards also have fiduciary responsibilities to ensure effective governance, ethical conduct, and the long-term success of the institution. Boards should be concerned with high-level issues and not with the day-to-day management of the college or university. It is hoped that this guide will help board members to better understand the nuances of academic program delivery, faculty culture, and the intricate financial dynamics of course delivery.

An Overview of Key Concepts

In this section I define some of the key concepts used throughout this guide. The purpose for doing this is twofold. First, these concepts and their definitions may be foreign to even the most experienced higher education professionals. Using clear terms as I call attention to the complexities involved in academic cost stewardship makes the discussion more accessible Second, I want this section to serve as an example of how to establish clear common terms when institutions decide to pursue an academic cost stewardship culture. Here, I want to emphasize the word example, as each college or university should make sure its concepts and definitions are customized to represent its unique policies and norms.

Academic Cost Stewardship

Academic cost stewardship is the deliberate and collaborative effort to effectively manage and oversee the financial and academic resources of higher education institutions. It involves a comprehensive approach that includes understanding the costs associated with delivering education, engaging faculty in decision-making processes, and utilizing trusted data and decision support tools to ensure sustainable financial practices. This type of stewardship aims to align the institution’s financial practices with its academic mission in an era of economic and societal changes, thereby ensuring that decisions regarding costs are made with a comprehensive understanding of their impact on academic quality, the accessibility of education, and the overall student and faculty experience.

Operational Approach Versus Strategic Mindset

Operational activities usually have a narrow, clearly defined scope because they focus on the details that academic departments and administrative units often prioritize. These operational activities normally rely on using historical precedents to inform decision making without considering recent changes that may have occurred within or outside of the unit. The operational approach often results in incremental decision making, which emphasizes small adjustments to the status quo but does not readily adjust for changes that may be occurring within the unit or institution over time. A strategic mindset, on the other hand, provides decision makers with guidance to support all academic departments and administrative units to work toward a cohesive goal, even if their day-to-day activities and short-term objectives vary. I revisit this concept in greater detail in Section 3 and throughout the guide.

Formative Learning Approach

One of the meanings of the word formative in the Merriam-Webster Dictionary is “capable of alteration by growth and development.” The growth and development of the methods and data used in academic cost stewardship are key activities that I promote throughout this guide. I underscore the fact that this is not a one-time effort that institutions can make with or without external support. Rather, I believe this should be an ongoing effort that must evolve over time. While institutions strive to use accurate data in decision making, in this type of project, faculty and staff need to move forward with the information they have and continue to refine and develop data to improve the quality of decisions’ outcomes. Further, my experience suggests that a comprehensive academic cost stewardship project identifies potential policy discrepancies across the institution and causes administrators and faculty to reconsider historical business processes and policies. Embracing and developing collaborative solutions to these discrepancies is necessary for long-term success. More is said about the formative learning approach in Sections 5 and 12.

Centralized Data Repository and Shadow Databases

The strategic mindset I explained above requires a centralized data repository in which accurate data from all sources are collected, verified, maintained, reported, and made available for decision making. Unfortunately, in many cases, several individual units of an institution collect, maintain, and report their own versions of data, as opposed to having a central repository of data that is maintained at the institutional level. I refer to these unit-level duplicated data stores as shadow databases. Obviously, the existence of these shadow databases creates problems of data consistency and integrity. Therefore, in this guide I advocate for coordinating the existing technology and staffing infrastructure necessary to provide a single trusted repository of data maintained at the institutional level. More on this concept is discussed in Section 9.

Academic Cost Framework

An academic cost framework is a customized system developed collaboratively by faculty and administrators to align cost drivers and revenues with each academic discipline requiring the resources and delivering the curriculum. This framework undergirds a hybrid cost model that considers the unique funding needs of each academic discipline, accounts for the multidisciplinary nature of higher education curricula, and aligns direct expenses and revenues with the credits or units produced by each discipline. Generally, an academic cost framework requires a careful classification of all curricula, which then serves as the foundation for merging information on coursework delivery, faculty effort, and resources such as supplies, equipment, and professional development courses with each component of the institution’s curriculum. Further, the framework enables the institution to align revenues from individual students (e.g., tuition and fees) with revenues from other sources (e.g., federal and state appropriations and income from endowments). In addition to relying on a plethora of metrics from each discipline in support of the decision-making process, leaders can use the framework to determine the unique cost and revenue of each credit hour produced for each course in each section.

Decision Support Reporting Tool

Having a centralized data repository is just one component of a decision support reporting tool, but it is essential for administrators, faculty, and governing boards to make informed and effective decisions. Another vital component is the means by which these data, often presented in reports, are organized, and made available to decision makers. Institutions may refer to these reports as budget planning guides, academic outcomes reports, or other titles. The final component of a decision support tool is a consistent user interface that can visualize the information clearly and concisely to help administrators not only make decisions informed by data but also communicate and explain these decisions to key stakeholders. In some cases, institutions may rely on Excel sheets and printed reports and might not be capable of implementing sophisticated visualization tools. In other cases, institutions may have access to popular analytic tools such as Tableau, Cognos, or Power BI, which exist within the institution’s information system. The key point here is that every college and university is different, so getting started with what is available is much more productive than waiting for a “do it all” technology solution, which rarely delivers as promised.

Another way of saying this is that leveraging what is understood and available to the institutional community is preferable to feeling compelled to completely overhaul the current information system. Given my experience in this space, I want to be sure to suggest that the decision support reporting tool not be the only resource used when making academic cost stewardship decisions. Rather, I suggest that this reporting tool be used in conjunction with the institutional mission statement, relevant qualitative data, learning outcomes data, and other useful information. This approach ensures the decisions are informed by a holistic set of information rather than driven by a sole source. I discuss this concept in more detail in Sections 5, 9, and 10.

College and University Information Systems

Many information systems used by key administrative units of colleges and universities, such as human resources; financial planning office; academic affairs, which oversees curriculum planning and faculty effort; and student affairs, are not integrated into one system. Despite the proliferation of enterprise resource planning platforms (e.g., Ellucian, Oracle, and Workday) and their use by organizations to manage and integrate essential information about their academic departments and administrative units, the systems of key areas continue to operate independently from one another. This is an issue because effective cost stewardship relies on comprehensive data that can only be obtained if information systems are coordinated. In most cases, it is possible to create and maintain a database that consolidates these disparate datasets, and it is worth the effort needed to generate it.

Key Points

• Academic cost stewardship involves understanding and managing the costs of delivering academic programming.

• An academic cost stewardship culture is composed of an institution’s key constituents, which are governing boards, administrators, faculty, staff, and students.

• Academic cost stewardship promotes a formative culture, which includes transparency in decision making, collaboration among institutional units, effective shared governance, ethical cost stewardship, continuous assessments of procedures and policies, and opportunities for professional development.

• A supportive infrastructure is based on a high-quality data repository, decision support tools, improved policies, integrated information systems, clear planning processes, and useful resource alignment; these are components of a healthy academic cost framework.

• The ongoing challenges facing higher education, including enrollment declines and financial challenges, underscore the importance of academic cost stewardship.

• A comprehensive approach involving administrators, faculty, and governing boards is essential for reaching the mutually inclusive goals of effectively stewarding academic costs and ensuring the delivery of a high-quality education.