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BUFDG Annual Conference 2016 - Leading Finance for High Performance

on Tuesday, 05 April 2016.

The conference season has well and truly started with this year's BUFDG conference generously hosted by the University of Lincoln in the early Spring.

A packed agenda took in the local culture, from the grandeur of the cathedral and its infamous imp to the adrenalin rush provided by the Red Arrows and one of its former lead pilots as the keynote speaker at the gala dinner.

In between, there were plenty of thought provoking workshops and plenary sessions to get conversations flowing in the direction of travel for higher education.

So what did we learn?

Our hosts - the University of Lincoln

The University of Lincoln was founded in 1996 and is now home to 13,000 students and 1,500 staff. It is one of the top 10 modern universities in the Times and Sunday Times Good University Guide 2015. A warm welcome is matched by a campus transformed from the brownfields of rail engineering to a modern campus where new meets old and thrives.

Their strength is built upon creating an atmosphere of partnerships from students and employers and onto the city and county, which helps provide a university that is business oriented. For the future, the university anticipates making sure students remain at the heart of their plans, to ensure their experience optimises their chances for employability. More business partnerships will generate technical excellence as well enhance that student experience. The opening up of the markets to new participants through the HE Bill will present new challenges - but be prepared for that competition, it will come. More regulation and increased volatility will make planning investment choices tricky - the best universities will be those that manage their risk effectively.

International integrated reporting standards - the way forward?

The adoption by commercial businesses and increasingly by universities of integrated reporting standards has been shown to provide direct benefits across a number of areas. Reporting on more than just the financial performance, institutions embrace a more holistic outlook that captures strategy and planning, delivers more informed decision making and better management of key risks to build stakeholder confidence and improve future performance.

Whilst currently voluntary, one can see the benefits. It was felt that universities could adopt this model on their own terms without the need for a top-down regulated directive imposed by HEFCE/W.

Business partnerships

The development of business partnerships was a recurring theme. Guidance from respected advisers such as the ICAEW was supplemented by fascinating practical examples of Loughborough University's experience in re-fashioning its finance function so as to provide a team that was very much fit to take on the challenges that a modern university faces.

The team had gone from one that did not match the wider structure, was not sufficiently forward looking, operated in silos and didn't embrace knowledge sharing, to one where staff were invested in. Training resulted in better quality staff, the team has been expanded and recognised as providing a more valuable and forward looking role within the university. That transformation has not always been easy and has taken longer than was hoped, but in two and a half years the finance team is in far better shape to serve and direct the university. Finance strategies were debated in detail during the conference, and it is clear that finance directors need to have access to snapshot financial information in order to inform and lead investment decisions.

Sustainability

Like all sectors, higher education faces a challenge of sustainability. Given their position as disseminators of knowledge and best practice, universities have a real role to help educate and fashion how we do business in a sustainable way. That also means making sure its own house is in order - the challenge, as it often is, is to deliver more for a smaller carbon footprint.

That issue matters for the millennial generation - 80% of students feel sustainability is important - and that figure will transcend to all of us, whatever we do. The best businesses will enhance their reputations as responsible employers by embracing a culture that is environmentally friendly.

Future planning - the challenges… and solutions?

So how easy is it to plan strategically for the storms that lie ahead? It won't be easy. Challenges and traps lie in wait for the unwary: the Green Paper and TEF, government austerity, globalisation and the competition for good quality students in the face of demographic changes are all factors to be considered.

The lifting of the student numbers cap is having a very dramatic effect already. Some universities are contracting to maintain quality while others are chasing expansion and numbers. HEFCE itself is predicting some course failures and worse, some universities are expected to fall by the wayside. So what can universities do?

There is an inherent tension and push-pull effect between resources such as people, finances and capital infrastructure (which can be easier to influence in the short term but whose longer term effect can be trickier to predict) and reputations derived from research, partnerships and esteem factors (which are by their nature far harder to influence and gain over a much longer period). That will require some new thinking as to how universities get to where they need to be and what type of SMT they need to plan and implement a new type of strategy. It will involve a mix of the analytical and strategic to marshal and guide universities through an ever more complex and choppy sea.

For more information on how we can help, please contact Jane Byford on 0121 227 3712 or complete the form below.

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