Universities Look in New Places to Trim Budgets

Greg Jones

Schools are running out of funding, and as a result they are looking to the private sector for ways in which they could trim their bloated budgets. The University of North Carolina recently did what most companies do when their budget is running a little high, they hired a consulting firm. In a recent story by the New York Times entitled Universities Turn to Consultants to Trim Budgets, by Tamar Lewin, outlines how the consulting firm hired by UNC told them how to save up to $150 million dollars. The key, the consulting firm says, is to make sure to stay away from touchy subjects like tenure and course loads. "Like any other large organization," the chancellor of UNC was quoted as saying, "we hire people, we buy stuff, we connect to the Internet, we build buildings and take care of our property, and we wanted [the consulting firm] to look at how we could carry out those functions as efficiently as possible." Since this consulting company, Bain & Company, did this consulting with UNC, it has been hired by University of California: Berkley and Cornell University. The University of North Carolina clearly isn't the only one interested in trimming the fat in preparation for budget shortfalls.

The main advantage of hiring a consulting firm to streamline processes such as procurement and IT is, put simply, experience. It's the same reason why doctors don't attempt to treat themselves when they get sick, because they know there are specialists out there with more experience in the field they are looking at getting treatment for. The people at Bain & Company have been doing this for over a decade, and though their prices may be high ($3 million dollars in the case of Berkley), if they produce real results the cost will be well worth it. This issue is important to students in higher education because if solutions aren't found to budget crises at universities on the business side, then funding will start to be subtracted from the academic side. These funding cuts could even include; rises in tuition, cuts of programs, and overcrowding of classes.