When embarking on a mission-driven quest for enhanced academic cost stewardship, leaders of a large university endeavored to craft a cost-based decision support approach. They did not want to discard the prevailing mission-centric culture and staunchly insisted that the new tool would complement it; they believed it would allow certain programs to incur higher costs based on mission-related justifications and discipline-specific needs. They recognized the length of time needed for the effort and the need for continual faculty input into it, foreseeing a multi-year development process in which clarity and the qualification of metrics would be ensured. The initial phase honed in on three pivotal areas: a collaborative exploration with deans and academic department chairs to grasp the nuances of the existing decision support tool; a meticulous review of crucial documents and academic programming to align efforts with institutional policies, cultural tenets, and norms; and the modification of the institution’s information system for the seamless integration of curricula, coursework, human resources, and financial data. A year later, this initiative bore fruit in the form of an academic department‒focused planning guide that supplemented the institution’s mission-centric resource allocation policies. Over the ensuing 2 to 3 years, the guide’s transparency generated improved relations between administrators and faculty, transforming academic cost stewardship into a shared responsibility. This evolution facilitated strategic investments and divestments in academic programming and was a significant step in improving academic excellence and financial sustainability.

Establishing a Foundation

Our experience suggests that higher education institutions should develop and maintain a decision support tool that will lead to a better understanding of the relationship between the expenditures associated with coursework delivery and the revenues collected through tuition and fees. Unfortunately, I have found many of these efforts to lack coordination among key information systems in areas such as coursework, faculty effort, and finances. Despite the proliferation of expensive information systems (e.g., Ellucian, Oracle, and Workday), this lack of integration continues primarily because administrative units (e.g., finance, human resources, and registrar’s offices) operate independently from one another. This results in a less informed institution, as described in Section 9. The lack of an integrated decision support tool is common in higher education and no doubt impedes the effectiveness of operational and strategic resource allocations to the detriment of the institution and the community it serves. As I have described in each of the previous sections to this point, institutional collaboration is critical to developing the tools necessary to ensure the institution is delivering high-quality education and at the same time ensuring a financially viable future.

In response, I offer a solution in the form of 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. For those familiar with higher education, the complexity of the effort described in the previous sentence should be apparent. Fortunately, our experience in developing academic cost frameworks at more than 40 higher education institutions in the United States demonstrates that this work can be effectively accomplished if dedicated resources are provided, and leaders have an ardent desire to make informed decisions related to academic programming. In Sections 10 through 12, I provide a high-level overview of the four key areas necessary to create this framework and, as importantly, call attention to the need for a comprehensive decision support tool that will create a shared understanding between administrators and faculty tasked with making informed academic programming decisions. Figure 7.1 calls attention to these four key areas, to include (1) the curriculum, (2) coursework delivery, (3) faculty effort, and (4) financial resources.

Figure 7.1 Academic Cost Stewardship Framework

Academic Program Classification

In Section 5, I mentioned that I had never found two academic affairs units that were the same. However, some common practices are observed by many higher education institutions in the United States. This is due, in part, to the federal compliance requirements outlined by the National Center for Education Statistics (NCES). This compliance-focused organization has developed the Classification of Instructional Programs (CIP), which provides a taxonomic scheme in support of the accurate tracking and reporting of fields of study and program completions activity. Additionally, CIP codes are often assigned to faculty members (e.g., according to academic department or academic association) and financial entities (e.g., for administrative support or supplies). If an institution does not use these codes for its staff and expenditures, it can use fields normally found in common information systems that are designed to house this information. As I discussed in Section 6, collaboration between the provost, CFO, and other leaders of administrative divisions is critically important to ensure this foundational classification structure is in place, so that each administrative division may contribute to an integrated database and decision support tool necessary for informing academic cost stewardship decisions. Given our experience, establishing this foundation may prove challenging for two key reasons. First, as mentioned several times earlier, the staff currently working in these areas tend to be operationally focused and normally have limited time available to set up relevant managerial systems. Second, this operational focus has led to a dearth of managerial reports and strategic resourcing, as I discussed in prior sections. To remedy this current state, institutions must incentivize executive leaders and their staff so that they approach data entry, verification, maintenance, and dissemination for use as an institutional resource rather than a unit resource. Once this classification structure is in place, it serves as a foundation for developing a holistic and transparent decision support asset necessary for high-quality cost stewardship. I begin to demonstrate this point by describing the integration of coursework delivery into the program structure.

Exercise for Provost, Senior Academic Administrators, and Faculty Leaders

Establishing a comprehensive and accepted academic program classification requires extensive collaboration across the academic affairs division and the academic units it oversees. This is often one of the more time intensive activities of developing a decision support tool, and I encourage an approach that is both collaborative and transparent. To support this approach, I offer the following activity that may be facilitated by the academic affairs team.

1. Curriculum Mapping Workshops – Organize workshops in which faculty members from different academic departments come together to map out the existing curriculum. This activity involves identifying and documenting all courses, their prerequisites, and how they fit into various programs. The goal is to create a visual representation of the curriculum, highlighting interdisciplinary connections and potential overlaps or gaps. This exercise can foster collaboration and a shared understanding of the academic offerings. Many institutions will find additional value, as they can use the information for compliance reporting, enrollment marketing, and accreditation efforts.

The successful completion of an academic program classification establishes a foundation for reviewing all other activities (e.g., course offerings, course loads, student needs, expenses, revenues). Getting this done correctly at the beginning promotes a mutual understanding of the curriculum and serves as the basis for all the work, analysis, and conversations to come.