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Archive for the ‘decision making’ Category

internet-unfollowA trend in higher education is the move towards decentralized budgeting.   Terms like ‘Responsbility Based Budgeting’, ‘Activity Based Budgeting’, ‘Responsibility Centered Budgeting’ and ‘Value Centered Budgeting’ are used to describe this concept.   Support for responsbility based budgeting at universities has been mixed.  Organizations like the NEA have expressed their concerns with it (Beware Higher Ed’s Newest Budget Twist by Leroy W. Dubeck) and organizations like the National Association of College and University Business Officer’s have generally been supportive of it (The Case for Decentralized Financial Management, by Scott Scarborough).

If your university is engaged in discussions about responsbility based budgeting, it is important to understand how it works.  I have found the following document to be the absolute best source of information:   Responsibility Center Management: Lessons from 25 Years of Decentralized Management by Jon C. Strauss and John R. Curry.   This is a relatively old document (2002), yet it is the most comprehensive and readable report on the principles, guidelines and details on how to make decentralized budgeting work.

Please consider the following quote from the preface of the report”

Decentralization is a natural act in universities. Decentralization of authority, that is.  Decentralization of responsibility is not a natural act.That requires intention and design.  Many academic leaders will say that most authority lies with the faculty in departments and schools, and most responsibility lies with central administrators. In many universities today, this state still obtains yet is more often lamented than addressed and managed.  Increasing numbers of institutions,however, are making explicit efforts to address such imbalances, to design organizational structures and incentives to make responsibility commensurate with authority, wherever that authority lies. The problem we address is the decoupling of academic authority from financial responsibility.

I highly recommend that you read this document as you consider new budeting models at your university.

from the pen of Dr. Percy Trappe

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squareWhat words of wisdom could Jack Dorsey, co-founder of Twitter and the founder and CEO of Square,  possibly have for the academic dean?   In a National Public Radio interview with Kai Ryssdal on May 21, 2015, Dorsey discussed his management style.    In particular, he discussed a management style similar to my own.   One where people and their ideas are highly-valued, one where decision-making is pushed closer to the stakeholder, and one where organizational leadership is key.   Following is a quote from the interview with Jack Dorsey:

I say that if I have to make a decision, we have an organizational failure. (That’s) because I don’t have the same context as someone who is working day to day with the data, with the understanding of the customer. I definitely see the organization and the people in it as the ones to make the decisions, because they have the greatest context for what needs to be done.

How many academic leaders can honestly agree with a management philosophy where “my job is to make sure that decisions get made” and where “there is an organizational failure if I am making the decisions”?  I would like to re-frame Jack Dorsey’s quote to make it applicable in a university setting:

I say that if a provost, dean or department head has to make a decision affecting academic program curriculum, the university has an organizational failure. This is because the provost, dean or department head does not have the same context as someone who is working day to day with an understanding of the students and the expected learning outcomes of the academic program.  The provost, dean or department head should definitely see the university and the faculty in it as the ones to make the curricular decisions, because they have the greatest context for what needs to be done.  (quote: Dr. Percy Trappe)

What do you think?   Does this ring true?  Is this your experience?   I would suggest that department heads, deans and provosts have much to learn from Jack Dorsey.

from the pen of Dr. Percy Trappe   

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