Financial Efficiencies – Is your University Fit for the Future?

Universities are in the midst of a perfect storm. Core income is being challenged by a demographic nadir in school leavers and increased competition for student recruitment. Recurrent costs are increasing both through pay increases and significant rises in employer pension contributions. And all this at a time when the political and policy landscape is as volatile as, arguably, it has ever been. Whilst on the face of it sector finances are in reasonable shape, the challenges coming down the track mean that universities need a high level of maturity in their operating models to stay financially fit for the future – particularly in terms of being able to demonstrate an optimal staffing structure with an appropriate cost base.

SUMS is working with a number of our members to deliver financial efficiencies by helping identify opportunities for recurrent cost savings to deliver both short-term and longer-term objectives. We look at the operating model, determining if it derives the greatest value. Typically, we use a three-phase approach that focuses on creating a robust evidence base that will help ensure benefits are realised: Data Capture and Analysis; Benchmarking; and Insight Generation and Options Development. The results allow universities to make savings in a nuanced, intelligent way rather than more bluntly taking out a fixed percentage of cost. Crucially, the process also shines a spotlight on areas where investment is likely to pay dividends.

Our lead consultant for this practice is David Becker. David was previously Director of Corporate Operations at one of the UK’s largest universities where he reduced the recurrent cost base by £10m while increasing student satisfaction to +92%. Since joining SUMS he has led efficiency assignments with members from across the sector.

To find out more about how SUMS can help your university make efficiency savings, please email sums@reading.ac.uk