2024 EDUCAUSE Top 10
#5: Administrative Cost Reduction

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Organizations have always sought ways to optimize operations and to reduce administrative costs, but today's context and available strategies both complicate and facilitate those objectives. Technological advancements such as automation, AI, and cloud computing, as well as the management frameworks that have evolved to effectively use these advancements, offer greater possibilities. But data, data diversity, and data sources continue to increase rapidly and grow more complex. Staff and faculty are also using many more digital tools, including many that technology managers are unaware of. Administrative processes still frequently conform to manual work instead of being optimized for modern digital solutions. Too often, the solution to this digital mess has been to hire more staff, engage consultants, and invest in more tools, with outcomes that increase complexity and costs.

No institution can afford to continue on this trajectory. In 2025, the demographic cliff—a major and sustained decrease in "traditional" college-age students (18–25)—will hit higher education. At the same time, skepticism about higher education is worsening. Only 36 percent of respondents to a Gallup opinion poll conducted in June 2023 expressed "a great deal" or "quite a lot" of confidence in higher education, down from 48 percent in 2018 and 57 percent in 2015.^Footnote1 Other research suggests this slide in confidence is associated with questions about the costs of higher education and the concrete benefits that actually accrue from those costs.^Footnote2 The ability to save money and reduce costs is vital for higher education institutions, and reducing administrative costs is preferable to reducing academic programs and experiences.

The Promise

Streamlining processes, data, and technology can yield benefits beyond cost reduction for institutions that undertake this work strategically. Students are used to very quick responses from and easy interfaces with companies—an experience they do not often have at colleges and universities. Reengineering student services to provide consumer-level ease and features is an additional opportunity for institutions.

Simplifying administrative processes and data can lead to cleaner single-source data, which could enhance external reporting, reduce administrative errors, and provide more meaningful business intelligence.

A streamlined data and technology environment helps lay the foundation for institutional agility. Changes are less likely to result in errors, and errors are easier to diagnose and remediate. The very exercise of a streamlining initiative will—if successful—spur culture change, since so much of the existing administrative complexity of the institution is based in cultural aspects that have become dysfunctional and obsolete.

This work can also make innovation easier. A simplified administrative backbone may provide the cultural and technical flexibility needed to support the development of new operating models, diversification into new business areas, and exploration of new ways of managing the student journey from start to end.

Leaders lucky enough to be in a revenue-neutral institutional environment may be able to apply administrative cost savings to more student-focused services and benefits.

QuickTakes

It's good to be small. Smaller and medium-sized institutions with limited resources and tight budgets have the most to gain, because even small savings have a proportionately greater impact.

It's hard to be complex. Institutions with multiple locations, autonomous programs, and many layers of decision-making will struggle to achieve meaningful cost reductions. Initial estimates of large savings may be whittled away by a multitude of stakeholder exceptions.

Say goodbye to digital legacy. Replacing legacy systems and infrastructure with a modern ERP is a strategy many institutions are pursuing to reduce administrative costs.

Compliance isn't cheap. A complex regulatory climate might reduce leaders' ability to find and maximize cost savings.

Culture eats strategy for breakfast. Resistance to change will probably be the biggest barrier to administrative streamlining. Institutions will need effective, committed leaders who know how to spearhead culture change.

The Key to Progress

It's up to leaders to focus these initiatives on meaningful savings and to help stakeholders recognize the "greater good" benefits that such savings will lead to.

From Strategy to Practice

What You're Saying

"Cost reduction is no longer a one-off in higher ed, and we honestly believe that technology can help. However, there is considerable friction between such approaches and culture, and that friction needs to be carefully worked into a plan. In addition, we don't want a workplace full of staff who fear that their work will be replaced by technological advances."

"The university has made streamlining and removal of organizational silos a major priority. But it takes true collaboration to make this work well and technology—collaborative software, wiki technology, etc.—has been a critical success factor."

"The institution is making decisions out of financial necessity and fear, from a scarcity perspective. They aren't prioritizing IT investments for strategic advantage."

Solution Spotlights

"The University of British Columbia in Canada has invested in people and tools to implement a variety of automation projects. A new team in IT has been formed to use robotic process automation and business process automation software, along with lean process enhancement, to engineer inefficiency out of our administrative processes. An additional benefit besides cost savings is that this allows staff to focus on more meaningful activities, which have enhanced their work experience. We have implemented projects in both academic and administrative units, as well as within IT, to automate cybersecurity tasks as well as other previously manual activities."

Jennifer Burns

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"The University of Auckland in New Zealand participates extensively in the Cubane UniForum benchmarking and has built a solid understanding of the efficiency and effectiveness of our administrative and professional services. We're now working to marry the financial view of the budgets with the FTE view of the budgets, aligning workforce size, shape, and composition drivers with the performance and desired customer experiences of those services. This work is underpinned by business capability road-mapping and our enterprise architecture practice."

Jeff Kennedy

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"California State University, Sacramento has various strategic initiatives planned this FY to lay the foundation: (1) identify institutional goals for student systems in use, understand and evaluate academic and administrative processes supported by these systems, recommend improvements, and implement a roadmap to achieve recommendations; (2) in partnership with Academic Affairs, Student Affairs, Advancement, and the College of Continuing Education, conduct a campus-wide survey on use cases for a CRM platform solution to address the challenges related to enrollment management, retention, recruitment, and fundraising (3) align the content of the My Sac State portal and the mobile app to better serve students, faculty, and staff."

Hema Manickavinayaham

What You're Working On

Comments provided by Top 10 survey respondents who rated this issue as important

Automation

• Adding an onboarding portal to better manage the student experience.
• Many services are being driven toward a 24x7 model, with the help of third-party organizations. That is, the institution is soliciting the help of other organizations to provide extended services (enhanced in many places).
• Focus on eliminating waste and using tech and data in ways to reduce costs of delivering services.
• Leveraging enterprise-wide software such as Jira and Confluence to streamline intake and management of work and documentation.
• Updating and improving the workflow, automation, and ease of use—then moving to ML levels of automation where possible.
• Using vacant positions to become automation specialists, to streamline processes and reduce manual tasks.
• We are automating and/or outsourcing a variety of processes, including budget transfers, help desk services, password resets, and requests for services.
• We are implementing data orchestration services to automate many manual tasks.
• We used a product called Laserfiche to reengineer and automate over 120 paper form processes. Reduced twenty FTEs across the university. The team won multiple awards internally and in the Silicon Valley high-tech industry.

ERP project

• ERP implementation for finance will be a big one—looking for better business processes and data.
• Implementation of Workday for HR/ Finance.
• Implemented Workday HCM and Workday SIS in progress. Continue to add more financial and human resource capabilities in HCM to streamline processes. Long-term plan is to take a platform approach, leverage the product R&D of Workday and partners within its ecosystem to save on data integration and technology debt accumulation and continue to automate administrative workflows. Improve the user experience for staff and students.
• Undertaking an ERP modernization project to build digital transformation into our DNA.

Process redesign

• Business process analysis completed for every department on campus. Deployment of the BPA in each department is ongoing.
• Our "digitalization office" is creating a special practice for process improvement in professional services.
• Reconceptualizing our business process, standardizing and automating as much as possible.
• We are constantly working with departments to identify and streamline business processes. We recently rolled out a new project intake and prioritization process that is aligned with the top strategic initiatives of the college. This has helped IT to focus on the projects that best position the institution to move forward.

Procurement and vendors

• Annual reviews of costs by reviewing options and contacting vendors for cost savings.
• Our efforts on security have resulted in reduced cost for cyberinsurance. For example, two years ago our premium was $150k; this year it is $50k.
• Streamlining procurement of low-risk software.

Remove redundancy

• Eliminating redundancy and better coordinating similar but disparate campus efforts.
• Through governance, the IT operating model, enterprise architecture, and centralized procurement, we are working to reduce duplication and gain economies of scale.

Shared services

• Aggressively merging administrative functions into shared services.
• IT as a service (aka shared services) for centralized, efficient, workforce-resilient, administrative services at scale and reduced costs.
• Common administrative processes and systems. We have a 24-campus financial system and are rolling out the same for human resources. We are looking for sharing services across IT and especially the security operations.

And more…

• Digital transformation assessments by portfolio.
• Currently undergoing an IT audit that reviews ROI.
• Reorganization planning across the entire campus organizational chart; combining schools, eliminating others has been mentioned. Data policy should help get better data.
• The university is using a data-driven approach that helps institutions identify areas of improvement and make informed decisions about their online learning strategies. The university will leverage data analytics and business intelligence tools to make informed decisions.
• Investing in Tableau more fully for data visualization; growing our data governance committee structure; seeking grants for unified data analytics. We are also looking at personnel restructuring.

Notes

1. Megan Brenan, "Americans' Confidence in Higher Education Down Sharply," Gallup (website), July 11, 2023. Jump back to footnote 1 in the text.↩
2. Tamara Hiler, Rachel Fishman, and Sophie Nguyen, "One Semester Later: How Prospective and Current College Students' Perspectives of Higher Ed Have Changed between August and December 2020," Third Way (website), January 21, 2021. Jump back to footnote 2 in the text.↩

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Sarah Cockrill is Director of Digital Strategy and Information Technology, Canterbury Christ Church University, United Kingdom.

Mike Richichi is AVP for IT and Deputy CIO, Baruch Computing and Technology Center, Baruch College, City University of New York.

Ioannis Salmatzidis is Director of IT, Aristotle University of Thessaloniki, Greece.