Understanding the impact of responsibility center management on higher education: a case study of Rutgers University
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Wang, Yonghong.
Understanding the impact of responsibility center management on higher education: a case study of Rutgers University. Retrieved from
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TitleUnderstanding the impact of responsibility center management on higher education: a case study of Rutgers University
Date Created2022
Other Date2022-05 (degree)
Extent107 pages : illustrations
DescriptionResponsibility Center Management (RCM) was first implemented by the University of Pennsylvania in 1974. In the subsequent years, more than fifty American colleges and universities have adopted this budgeting system, with several more actively considering its adoption. Despite the increased popularity of RCM, there are few studies examining its early impact, in the years immediately following implementation. This dissertation helps address that gap in the literature by examining the impact on Rutgers University of its 2016 adoption of RCM.
Drawing upon institutional document analysis as well as in-depth interviews with thirty- nine administrators, faculty and staff members across the three campuses at Rutgers: New Brunswick, Newark, and Camden, this case study identified nearly a dozen impacts on the university’s culture, finances, and management. Several impacts were found to be consistent with the existing literature. These impacts include enhanced cost consciousness and accountability coupled with insufficient transparency, increased competition among academic units for students and tuition revenue, inhibited interdisciplinary collaboration, and a lack of clarity and transparency about how cost pools are calculated.
The study also identified several challenges resulting from the adoption and implementation of RCM at Rutgers that had not been previously documented in the literature. Specifically, the study found that RCM at Rutgers disincentivized state sponsored research, hindered financial and strategic planning at all but the campus level, posed challenges to the university’s research enterprise, and was inconsistently implemented within the Rutgers system.
The success of a university budget model goes beyond its use as a financial tool. A successful budget model not only allocates revenues and costs, but also provides clarity, predictability and a roadmap for financial and strategic planning. A good budget model is aligned with the mission, culture, goals and strategic priorities of an institution. A good budget model furthers academic excellence by driving budgeting procedures that align with the economic realities an institution faces. At Rutgers, RCM failed to achieve its goals on these criteria.
The findings have implications for other RCM institutions as well as for any institutions of higher education considering a move to RCM. The analytic results provide evidence that institutional allocation choices have substantial effects on higher education outcomes as they create incentives that can either encourage or impede specific behaviors. Also, RCM’s objective of bringing marketplace incentives to higher education works against the collaborative nature of higher education and can pit units against each other, causing them to fight for resources. Finally, the unintended consequences of RCM can limit an institution’s growth and prosperity unless it can respond to them effectively and in a timely fashion.
NotePh.D.
NoteIncludes bibliographical references
Genretheses
LanguageEnglish
CollectionSchool of Graduate Studies Electronic Theses and Dissertations
Organization NameRutgers, The State University of New Jersey
RightsThe author owns the copyright to this work.
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