Most of us didn’t go into higher education or leadership to manage budgets (apologies to my accounting and budget colleagues). Or in today’s environment, to cut budgets. Yet that has become our reality. As much as we hope that the next budget cycle will be better, increasing your financial acumen and skillfully utilizing your budget is crucial to success and delivering on core commitments. As a CEO I used to work with said, “No margin, no mission.”
Operating with more knowledge can help you feel slightly more in control of your situation and allow you to make proactive and strategic decisions, rather than reacting to crises or external demands.
A great starting point is to pick up the phone and invite your CFO or budget/finance director out to lunch. Developing a partnership with your finance leader can help you learn and, more importantly, integrate financial strategy into your leadership actions before cuts need to be made.
At Minnesota State Colleges and Universities we have an online course titled Finance for the Non-financial Administrator. (MnSCU administrators can register here.) It provides tactical information on the financial systems we use, budget reports, acronyms and other foundational fiscal information needed to understand and manage a budget in our system. Finding that type of information wherever you work can help you increase your financial savvy.
Dr. George S. McClellan, author of the book, Budgets and Financial Management in Higher Education, shared his insights on budgeting and institutional missions in a recent interview that is an easy read and very informative. You can find it here. A key take-away for me was his advice when cutting budgets, “be sure you can articulate what you won’t be able to do if funding is not available for a particular program or service. Whose ox will be gored?”
You may not look forward to the next budget meeting but increasing your financial proficiency will help you make strategic decisions focused on your core commitments and values.