Planning and Budgeting in a
Low-Trust Environment

At a 2011 Academic Impressions conference on "Integrated Strategic Planning and Resource Allocation" (San Antonio, January 2011), 50 presidents, provosts, chief finance officers, and other members of senior leadership teams from an array of  public and private institutions were asked about the key issues and barriers they saw to making a planning and budgeting process effective -- and ensuring its implementation.

Thirty-seven of the attendees (nearly 75 percent) cited low trust as one of their primary obstacles. Two of the presenters at the AI conference -- Larry Goldstein, president of Campus Strategies, LLC, and Pat Sanaghan, president of The Sanaghan Group -- have offered to comment on the issue and offer practical steps for strategic planning in a low-trust environment.

Commitment from the Top

Goldstein and Sanaghan: First, the president and the cabinet must make a public commitment to creating and implementing an inclusive, participative, and transparent planning process. This applies just as much -- and possibly more -- to the resource allocation process. Plans are one thing, but trust becomes especially critical when money and other resources (positions, space, etc.) are at stake.

Without taking steps to cultivate institutional trust, a president simply cannot lead. In a low-trust environment, every decision becomes a debate. Campus officials and staff remain focused on the day-to-day events and issues, rather than the future of the institution. Fractious relationships develop between faculty and the administration. The rumor mill continually operates in high gear.

To build trust, it's critical that the institution's leadership commit to guiding principles of inclusiveness, transparency, and participation, and promise to adhere to these principles throughout the planning process -- and beyond. This holds leaders accountable in a visible and necessary way.

Keep in mind that if presidents don't live these principles after having espoused them, they will lose the campus. This makes the planning process a high-risk endeavor, but one that can be undertaken successfully with discipline and courage.

Building a Credible Planning Task Force

We recommend that the president convene a highly credible planning task force (PTF) to lead the planning process. The selection of your PTF is the single most important step in your planning process -- and building the right PTF is what will turn around the low-trust environment. Do not leave the selection to chance and do not rely on volunteers. You must intentionally identify and choose the best individuals. If you aren't certain who these are, ask for nominations based on these criteria:

• Highly respected and of stellar reputation (selecting these individuals sends the message that the process will have complete integrity and that it will actually get done)
• Capable of adopting an institutional perspective (versus championing their unit)
• Willing to commit the time needed for this work

Here are two additional recommendations:

• For the PTF members, aim for a balance of 60 percent faculty and 40 percent staff and administrators (without faculty buy-in, you will be unable to either develop or implement a realistic plan)
• Select as PTF co-chairs a high-level administrator (like the CFO or an executive vice president) and a well-known and highly respected faculty member, to model cross-boundary effort and the collaborative spirit you want to encourage

The president also needs to ensure that many more internal and external stakeholders will be engaged throughout the process -- and that they are actually heard. Although surveys have their place in a planning process, a survey as the sole means of soliciting input will not build trust with the campus community. The entire community needs to be engaged in the planning process, through face-to-face interaction and genuine dialogue -- not through canned progress reports.

Transparency Throughout the Process

To build and maintain a higher degree of trust, the president must make several additional, public commitments:

• That the planning process will address, not avoid, tough issues such as improving academic excellence, allocating resources strategically (versus simply incrementally), enhancing employee engagement, becoming more student-centric, etc.
• That the decision-making process will be open and transparent
• That there will be an annual update about the progress made toward implementation of the plan
• That the senior leadership team will participate in an ongoing review of the plan's progress

Often, distrust deepens because stakeholders are unclear about how decisions are being made. It is critical to articulate the decision-making process, including the roles of the PTF, the president, the cabinet, and the board.

For example, many at your institution may not realize that at the end of the day, the board must approve the plan as part of their governance responsibilities. If the board is not bought into the plan, believe it isn't aspirational enough, or conclude that the plan lacks comprehensiveness, they will not approve it. To avoid this situation occurring at the end of the planning process, the president needs to ensure that the board is fully engaged from the beginning, and that all stakeholders understand that the board will be the final arbiters of the plan.

Engage the board, but do not include board members as members of the PTF. Their direct participation on the PTF will stifle important conversations. Also, if included on the PTF, some board members may exert undue influence on the plan. Their input is essential, but it can be obtained through means other than having them on the task force.

Make sure that actions align with rhetoric. The president can't promise transparency or an inclusive decision-making process and then either participate in or knowingly tolerate "back-office deals."

Reviewing Progress

The annual update is key to improving trust and ensuring implementation. Senior leaders cannot bury uncomfortable results or lack of progress; these issues have to be addressed openly, ideally in public forums in which the president reports on the progress made, acknowledges what has not gone well, and addresses what will change as a result. It's critical that stakeholders have the opportunity to ask questions. No plan is perfect, and some things simply will not get done as scheduled; the president must have the integrity to communicate this. Even relaying less-than-stellar news can create trust if leaders are open and honest about it.

Finally, the president needs to commit to ongoing review of the progress within the senior leadership team. Stakeholders need to know and trust that the strategic plan regularly drives discussion and decision-making within the cabinet. To achieve this:

• Let the plan become the "cascading agenda" for cabinet meetings -- assign each major component of the plan to a single person
• Hold those team members accountable for results achieved (rewarded for success or sanctioned when they do not accomplish an objective without good reason)
• Ensure that progress on implementing the plan is factored into each member's performance appraisal

In this environment, senior leaders will understand the need to discuss the plan regularly with their direct reports, and to check in regularly on progress.