Transforming the Future of Higher Education Finances

As a sector hugely disrupted by the pandemic and facing ongoing challenges to its finances, the higher education sector is seeking to evolve. Digital transformation can be the catalyst for change – and starting the journey doesn’t have to be complex, says Nikki Lovell, Business Development Lead for Academia at SAP Concur.

The impact of the COVID-19 pandemic on the UK higher education sector was nothing short of severe. From lockdowns paralysing university attendance to the inability for overseas students to travel, the financial impact was vast.

In fact, it’s estimated that the loss of overseas student fees alone sliced around £7bn off the universities sector’s annual income of around £40bn.

But pressure on higher education finances is not purely a COVID-19 issue – and the move towards post-pandemic life doesn’t remove the need to cut costs, grow margins and improve the user experience.

How is digitalisation transforming process and infrastructure within Higher Education?

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Ratings agency Fitch, in its latest higher education market update, says that ongoing challenges to funding, tuition and rental revenue, the supply of qualified staffing, waning support from central government, and concern that demographics can limit demand are all threatening the sector’s income.

The situation is exacerbated further by Brexit, which is estimated by the Department for Education to be costing UK universities £62.5m per year in lost tuition fees.

Rising To The Challenge

In response to the ongoing pressures on higher education finances, many in the sector are turning to transformation to improve efficiencies, reduce losses and increase margins.

One such example is the University of Portsmouth where Nicola Nestor, Deputy Director of Finance at the university and who is leading its finance transformation programme, told our recent SAP Concur webinar; How is Digitalisation Transforming Process & Infrastructure Within Higher Education?; “There is an overwhelming drive for efficiency among universities today – a drive for us to be achieving more and for things to be costing less. In today’s age, achieving that is dependent on technology – pushing technology to do more. Gone are the piecemeal bits of software that we used to have. Now, we need something that is as integrated as possible.

“Finance leaders have a pivotal role to play in the direction that transformation takes,” she added. “We have to push for automation, for use of APIs, and for a real focus on the end-user experience.”

Powering Transformation Through Technology

Technology, and digital transformation, of course, have the ability to deliver on lots of these needs – and can meet many of the higher education sector’s near and longer-term priorities.

Digital transformation can help the sector as a whole serve all citizens with efficient, responsive and consistent services. At an institutional level, it can deliver immediate impact – reducing costs and time to market, and allowing organisations to adapt more quickly. At an operational and user level, it can drive efficiency, deliver a more modern and seamless experience, improve the ability to scale quickly, provide real-time data and insights into budgets and spend – as well as reducing the risk of human error or financial failings.

Incremental Change is Positive Change

Of course, one of the things we sometimes hear from organisations is that they fear embarking on digital transformation journeys – either because they fear the cost or the time commitment required to deliver it.

But starting your tech transformation journey does not have to require a big investment of time or money.

Portsmouth, for example, started its journey by deploying the expenses and travel management elements of the SAP Concur Spend Management offering three years ago. As Nicola also told our webinar, the rollout has had a big impact in a short space of time.

“We use it for all travel arrangements and, as the world opens up post-pandemic and we are seeing our travel numbers rise significantly, that’s providing wide-reaching benefits, not only in terms of expense submission but also in terms of risk management and on the duty of care side of things,” she explained.

Indeed, the impact across the organisation – and for multiple stakeholders – can be wide-ranging: better controls and compliance; improved spend governance; an enhanced employee experience; and automated systems that free staff up to add value elsewhere.

And, as Nicola further explained, it can also be the basis for expanding that transformation journey into other areas.

“Transformation is about evolution – about driving improvements across a number of areas, to benefit colleagues, stakeholders and our students,” she told our session. “For me, it’s important that transformation in the university has two faces: the face of the back end – the people in finance – and the students. The experience must be improved for both – and starting with expenses and travel management has shown what an impact change can have.”

To find out what SAP Concur are doing within the Higher Education space, visit us at https://www.concur.co.uk/higher-education-solutions and perhaps take a listen to the Webinar with the University of Portsmouth!

Contact us if you would like to know how we can help you overhaul your spend management processes.