When a college is entering deep financial distress, there is one question that the president needs to answer – how many administrators and staff are needed to run the college. This administrative model has guided colleges for generations – a chief administrator is needed for every department and the department needs as many staff as the administrator claims to be needed to do the work of the department. However, in times of deep financial distress, this model is no longer workable. Here are several suggestions on downsizing an administrative structure. These suggestions will substantially increase the workload of those administrators or staff who remain, but the reductions must happen for the college to survive. There are several more points at the end about what to cut during a period of deep financial distress.
- Dismiss the position of the Chief Academic Officer. The president should be able to do the work of the Chief Academic officer.
- Dismiss the positions of assistant academic department administrators and staff. Academic department heads should be able to the work of their subordinates.
- Retain only the Development Officer, all other administrators and staff should be dismissed.
- Are all revenue centers – residence halls, dining halls, bookstore, athletics, and any other revenue center producing net positive revenue after the allocation of fixed costs? If a revenue center is not producing net positive revenue contributor, contract it out or close it.
- Retain only one administrative officer as head of all non-academic revenue services. As long as the college has a sport program, it will need to keep the athletic director. Preferably, the athletic director should coach one of the sports.
- End all free items for new and current students because these costs can result in large expenditures.
- End internal mail delivery services, the departments should pick up their own mail.
- Replace the head of building and grounds with a hands-on worker, if the current head can do the work, keep the person. Eliminate remaining maintenance staff. Keep only one member of the ground staff to handle grass cutting, trimming and snow removal. Only emergency repairs should be made.
- Revise expensive benefits by requiring larger contributions for health insurance, reduce or eliminate the contribution to retirements accounts, and reduce or eliminate any other employee benefits that require cash payments.
- Replace the Chief Financial Officer with a Chief Accountant. Eliminate all other financial and office positions except for the Bursar and Payroll.
- All expenditures no matter how trivial must be approved by the Chief Accountant. Anyone who makes a purchase that violates this directive will be responsible for the cost or will have to return the purchase.
- Can the CIO run basic operations with just one assistant? The CIO should find the least expensive phone and internet service for the colleges.
- Only offer summer courses and programs, if they generate sufficient net positive revenue to cover fixed costs.
- Cancel or postpone all construction.
- Stop all travel except that needed to save the college.
The Big Rules
Economize, Save Cash, Look for New Sources of Cash