A Zero-Based Budgeting Exercise

Innovation Profile #4

Topics: Budgeting, Administration and Finance, Student Affairs, Budget Models and Cost Allocations

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Mona Mogahed

Molly O'Connor, Senior Consultant

With fewer resources to work with, more demands being placed on the division, and ever increasing student needs to address, Student Affairs must determine how best to allocate its limited resources to best serve students. It can be exceedingly difficult to take money from staff or cut programs, particularly if they have been in place for a long time, and a certain group of staff or students are dedicated to them.

It is further complicated by the fact that, in the absence of formal and regular assessment, it can be difficult to evaluate the costs vs. benefits of specific programs. Responsibilities and funds are often widely dispersed, making it difficult to make clear decisions about what may be over- or underfunded. And, finally, with all divisions working in lean times and always wanting to do more for students, it’s rare that a unit or staff member will offer up that they have extra funds that would be better allocated elsewhere.

Case Study: American University

In order to ensure the efficient and fair allocation of resources, the Office of Campus Life at American University regularly puts its units through a zero-based budgeting exercise. The Director of Administration and Budget (DAB) for the Office of Campus Life oversees the process. Besides the budgetary benefits, she emphasizes that this is a good management exercise for department heads and other senior staff.