Triumph in Tough Times

By Anne Ponder    //    Volume 17,  Number 2   //    March/April 2009

It would be easy in these turbulent economic times to be discouraged by the waves of bad news that seem to flood us daily—to let fear of the unknown take over. Allowing such discouragement to inform our decision-making would not only be a disservice to our campuses, it also would guarantee that we would miss the opportunity to see crisis as a gift that provides an urgent incentive to focus on what is most important on our respective campuses.

The downturn in the economy of my state, North Carolina, so far is less severe than that of much of the rest of the nation, due to our diversified economy, financial discipline, constitutional mandate for a balanced budget, “rainy day” fund, and many years of consistent investment in higher education. In the University of North Carolina system, we’ve learned how to manage for the good times, the bad times, and the truly unimaginable. In addition, as a public university for more 200 years, we are regularly challenged by the legislature to examine our affordability. In fact, the amount paid by families of the neediest students attending a UNC campus since 2006 has actually declined, on average, by 19.4 percent, or $1,327 per year. As a result, the system’s campuses are experiencing a higher-than-expected number of applications for the current and the upcoming academic years.

And yet we too must cut back and balance our mission with our resources. As the economy rapidly unraveled in the fall, Erskine Bowles, president of the University of North Carolina, used his business and political acumen to generate accurate budget projections, leading us to manage during the current fiscal year with 96 percent of the budget appropriated for the year. Some cutbacks will have to become permanent, and we will have to make further budget projections in an atmosphere of continued uncertainty.

In this climate, I believe an institution needs to clearly reaffirm its mission, in our case as a small public liberal-arts institution. A campus community’s full and fervent agreement about who it is and why the institution exists will make every other decision, large and small, more manageable.

For example, when we learned of our first budget cut of this fiscal year, we looked to our mission to guide our decision-making. My campus, UNC-Asheville, is a liberal-arts institution with about 3,400 students, emphasizing small classes and a low student-to-faculty ratio that fosters important faculty and staff mentoring of students. Thus it was easy to declare that we would preserve, to the extent humanly possible, the jobs and salaries of all faculty and staff members in continuing positions. When all other operating budgets took a 15-percent cut, there was no campus controversy when academic departments took only a 10-percent cut. Preserving the core of our mission is a general understanding that does not require extensive additional campus discussion. Similarly, preserving the jobs and salaries of all continuing employees also helped us decide how we would manage vacancies. If positions need to be cut back or eliminated, we will eliminate unfilled positions. Both decisions will continue to be painful, but consistent with what we understand ourselves to be.

Budget cuts, declining revenues, and uncertain enrollments require budget discipline of the sort few campuses have managed to develop or maintain; we must choose not to do some things. In addition to a university’s mission, a clear and compelling strategic plan should provide additional specifics about how to make such decisions. A good plan will allow, even encourage, scrutiny of peripheral enterprises.

Every campus is engaged in initiatives that are highly desirable but not necessarily central to its mission. In difficult economic times, a strategic plan can help a campus identify those undertakings that are less central, and therefore less eligible for continued investment. Reassignments, flexibility, and creativity will allow us to share the remaining work.

Communication is crucial to making the best decisions during such times, as well as avoiding any unintentional use of the “panic button.” We held open meetings to allow anyone on campus to ask questions related to the budget, in an effort to bring more transparency into our process. At every step, we have kept our board of trustees, the board of our foundation, and other important constituent groups up to date on the decisions we have made and the uncertainty we face. Our boards and other advisors must know that we are making the best possible use of the assets that we have.

On our campus, our University Planning Council continues to share both the burden and the gift that is the current economic crisis. As ideas for streamlining our work are suggested, this group provides an important lens through which we view dramatic and unusual options. The university’s leadership has the responsibility and the obligation to consider actions that, absent such a crisis, would be politically or logistically untenable. A program that is no longer effective or well-utilized, an initiative that has completed its work but has well-respected participants and thus has continued to be funded, or even a truly great enterprise that is not central to a campus’s mission—all should be considered for revision, consolidation, sharing with external partners, or phasing out. In our current economic environment, a large proportion of the campus community will support difficult decisions in favor of preserving what is central to our work. This will be especially true when we have done a good job of publicly clarifying our mission.

Striking the balance between safety and risk, of course, is the real work of campus leaders. Stating that our highest priority was preserving the jobs of continuing faculty and staff was overtly intended to make coming to work the “least anxious place” in peoples’ lives. However, some level of anxiety is often just what is needed to prompt our best and most creative thinking. It takes every campus leader’s best work to continually calibrate and adjust that balance, and to act compassionately and swiftly when the balance appears to be slipping.

Some decisions with relatively small budgetary impact can serve as important symbols of community spirit. When we learned of our budget cuts, plans for our annual upscale, off-site year-end holiday gathering were already under way. In consultation with some senior members of the faculty, our staff advisory group, human-resources professionals, and individuals I encountered while conducting normal university business, I solicited advice about how to “right-size” the gathering in light of our budget cuts. In following that advice, we saved thousands of dollars by relocating the event to a campus venue where the space was free, and we collaborated with our provider of dining services to share the cost of catering. In addition, a few members of the senior staff and a member of our board of trustees got out their guitars and whipped up some interesting (if not entirely polished) entertainment for the event. In doing so, we learned what is most important to our campus about such an event—the opportunity to be together, to celebrate the end of a successful semester, and the season at hand. These changes were so successful, all the reaction we’ve received so far would suggest that we should do it this way every year.

Similarly, we have asked for advice from anyone on campus who has an idea about conserving university resources, designating a top administrator to serve as the clearinghouse. Even if few ideas turn out to have the potential to realize significant savings in the long run, the opportunity to contribute to the collective brainstorming is an important component of being part of the university community. Pulling together feels so much better than waiting and worrying. Creativity is everywhere, and these times require us to be uncharacteristically open to it.

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