Institutions of public higher education have felt economic strains in recent years, and Temple University is no exception. The Commonwealth of Pennsylvania was once a major underwriter of public higher education, but significant financial pressures in the state have resulted in declining support. As a result, over the past three years Temple University has made budget reductions totaling $113 million. The decline in public dollars has put increasing pressure on tuition. At the same time, our Board has resolved to make affordable access to excellence Temple's highest priority.
Temple University's decision to implement a decentralized budget model was influenced by the model's ability to:
- Allow for changes in response to concerns as they are recognized
- Decentralize responsibility and involve more faculty in budget and planning decisions
- Emphasize transparency and access to information that can lead to significant efficiencies and streamlining
- Encourage multi-year strategic planning, aligning resources with top priorities
- Incentivize schools and departments to strive for excellence in teaching, research and service
Temple University Deans, faculty and staff participated in meetings and interviews to provide a deeper understanding of Temple's readiness to transition to a responsibility centered management model. A number of common themes emerged from this exercise:
- Access to reliable data and standard reports
- Budget system that is transparent, easy to understand and well communicated
- Desire to create an environment of improved financial planning
- Financial resources supporting academic priorities, where revenue generation is not the lead or sole factor in the decision making process
- Importance of periodic review to ensure the budget model is continuing to meet the needs of the university community and is responsive to the broader macro environment
- Promoting shared governance to ensure broad understanding of, and participation in fiscal matters among faculty and staff
- Revenue Centers responsible for generating the revenue should be able to keep the revenue generated
Based on these themes and the thoughtful consideration of the steering committee, Temple developed a set of guiding principles to help us frame RCM. These principles will guide the process throughout its life in all circumstances irrespective of changes in its goals, strategies or leaders.