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April 1, 2021 | Leadership insights

How Strong Is the Relationship Between Your CFO and Provost?

In November, University of California, Riverside announced its hire of Elizabeth Watkins as its new provost and executive vice chancellor.


The former UC San Francisco vice chancellor would “collaborate closely” with the vice chancellor and chief financial officer “to manage the financial challenges posed by the global coronavirus pandemic,” UC Riverside noted.


To this I say: Yes, yes, yes, and yes. I’ve seen firsthand on many occasions how powerful partnerships between provosts and chief financial officers create myriad opportunities for institutions.


When a university’s chief academic and financial officers communicate regularly, they can cover respective blind spots and ensure they inform decision making with a holistic understanding of both mission-driven and financial priorities.

Looking for Efficiencies

Unfortunately, the model highlighted by UC Riverside remains atypical. All too often, these roles tend to operate in silos with collegial courtesy rather than true teamwork.


However, in today’s climate, both have much to gain from cultivating a more collaborative relationship, and an institution’s ability to accelerate its path toward financial sustainability likely depends on it.

Historically, provosts have focused primarily on academic program effectiveness and student success, with financial affairs being a secondary concern.


Meanwhile, the CFO’s domain has included financial management of programs, but retrospectively rather than proactively. Data presents the best bridge to overcome this divide, especially as the need to evaluate academic operations grows.

The reality is that, on average, administrative expenses only represent 35% of operating expense budgets. The other 65%, which primarily relates to instruction and academic operations, is simply the most realistic place to look for efficiencies.

CFOs are an incredible resource to provosts in this work and can help identify key measures to guide decision-making, such as:

  1. Contribution margin analysis: It’s important for colleges and universities to understand direct program costs and revenues. While not every program can or should have a positive contribution margin, executives should understand resource flow through their institutions to ensure sustainability of mission-critical programs.
  2. Student credit hours and enrollment trends: Institutions should have a full accounting of demand across academic departments and courses. Understanding which departments have increasing course registrations and which programs are on the decline, and other relevant market trends is critical.
  3. Instructional capacity: Faculty positions and teaching assignments ought to match student credit hour and enrollment trends going forward. Institutions need the tools to estimate course demand within departments and programs to plan and monitor faculty instructional assignments.
  4. Course efficiency: Improving course scheduling efficiency is one of the quickest ways to boost instructional capacity. Increasing a department’s course fill rates from 65 to 75 percent would use valuable faculty time better and reduce need for adjunct or contingent instructors. Additionally, monitoring course registration rates allows departments to make smarter decisions about which courses to incorporate or drop from curricula.
  5. Instructional faculty spend benchmarking: With faculty salaries representing the largest component of instructional expenses, benchmarking total faculty salary costs against peers is a powerful tool for the CFO and provost to measure their institution’s efficiency and manage its cost of instruction.

Data As the Emissary

When I talk about provosts and CFOs coming together for thoughtful improvement of long-term institutional financial health, I am aware that sometimes there are initial difficulties.


My approach is to use the data as the emissary between the chief academic and financial officers, so we are reviewing a common language and basing discussions on fact and not hyperbole, instinct, or long-held truisms. It doesn’t always come naturally, but when provosts and CFOs partner, they can make serious headway, particularly when lines of communication are wide open.


Say a professor retires. Very often, a replacement search opens automatically, but this needn’t be the case. It’s a good time to understand if the department is appropriately staffed, and one might find it is actually contracting, in which case resources are better deployed in an expanding program.


“Release time” is another little-understood cost. Provosts and CFOs who dive into the data will likely learn their institutions spend millions of dollars annually on non-teaching faculty responsibilities.


If tenured professors spend significant time on roles better delegated to administrative staff, a clear opportunity for institutional savings is to reallocate this time to instruction. A few months ago, Sinclair Community College in Dayton, Ohio, announced a 15 percent reduction in faculty release time in its new budget as part of broader cuts.


These are just a few opportunities. There are many more, particularly as new models for evaluating academic operations emerge from forging these cross-functional partnerships to different ways of approaching academic portfolio management.

“If you want to go fast, go alone,” the famous proverb goes. “If you want to go far, go together.” CFOs and provosts make a powerful combination that can go far in improving their institutions’ financial health both long-term and more immediately. Given the current challenges, they’ll want to start on both right away.


Darren Catalano is the former vice president of analytics at the University of Maryland Global Campus. He currently serves as CEO of HelioCampus, a company born out of the University System of Maryland that provides strategic decision support and insights to colleges and universities through an enterprise analytics platform, benchmarking, and data science services.


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