Linking budgets to desired academic outputs at Dalhousie University

Abstract

In 1993, faced with continuing university budget reductions and dissatisfaction with the budget-allocation process, the Faculty of Medicine at Dalhousie University undertook a financial planning process. The goal was to develop a new resource-allocation model to better link academic budget support to desired academic outputs over a three-year period. Department heads categorized academic outputs (e.g., teaching, research, administration, and subcategories of these), determined their relative values (expressed as percentages of the total department budget to be projected), and identified acceptable units of measuring the outputs (e.g., for teaching in the first and second years of medical school, the unit was the number of teaching hours). When dollar values were assigned to the units of measure, the new model was used to calculate budget allocations for all departments. However, many departments showed large negative shifts in their budgets; these shifts were too large to be achieved within three years because of departments' contractual obligations. Therefore, a practical limit in budget shift was determined. This adjustment permitted a three-year projection of academic budgets to be made for each department. The use of the resource-allocation model has achieved the Faculty's goal by creating a better rationalization of budgets to academic outputs, but carries the risk that departments might abandon essential but "undervalued" academic activities.