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This is a time when organizations can look carefully at how they can build the strongest possible programs for the future and how they can tell their stories most effectively. quently. Such increased attention is the perfect way to inform and attract current and future donors, he said at the fund- raising session in Orlando. "Business schools can be beacons of knowledge, rather than whipping boys, during this crisis," he says. "We have a big role to play to help the world understand what causes these cycles and how to mitigate their effects." A Time of Opportunity While the next year or two might be a frightening time for those who've never managed a campaign during a recession, Few schools are as strapped as those in California, which at one point faced a $26 billion deficit. The University of California and California State University systems alone could see $335 million in cuts for the 2009–2010 and 2010- 2011 academic years. In addition, the Cal Grant program, which provides grants to college fresh- men, will be phased out—200,000 freshmen who had received grants will have those grants reduced or rescinded. The budget crisis is so bad, "we've just stopped talking about it," says Gail Naughton of San Diego State University's College of Business Administration. With SDSU's endowment under water, the school, in the midst of its first-ever capital cam- paign, is taking creative approaches to find the funding it needs. To avoid faculty layoffs, Naughton and her advisory board plan to raise $3.3 million to pay for the benefits of several faculty members, under an agreement with SDSU that the university will support those faculty after three years. The school also received permission from its board to restructure its endow- ment so that it can draw from principal to cover its teaching expenses. "If we don't take these steps now," says Naugh- ton, "we won't be in a good position once the crisis ends." Even executive educa- tion, traditionally a top revenue generator, has taken a hit, says Mark Zupan of the University of Rochester's Simon School of Business. His school has seen a 25 percent reduction in enrollment to the school's executive MBA program. "We'll have accepted an applicant, and then he will call to —Roy Muir, Marts & Lundy it promises to be an exciting time as well, says Muir of Marts & Lundy. "This is a time when organizations can look care- fully at how they can build the strongest possible programs for the future, how they can bring value to society, and how they can tell their stories most effectively." Muir adds that while this downturn may take longer than others to reverse itself, it will come to an end. No matter what, campaigns will continue; schools will achieve their fund-raising goals. The only difference between today and years past? It might take longer than they origi- nally expected. ■ z say his company has backed away from its commitment to fund the program," says Zupan. "I haven't seen that hap- pen in 20 years in the industry." One lasting result of the recession may be new attitudes toward endowments. "It used to be that 'the school that dies with the biggest endowment wins,'" says DeNisi. "Today, donors no longer trust that they can give us a $1 million endowment and it will be safe. Now, if $1 mil- lion is worth $50,000 annually, they would rather just give $50,000 a year." Perhaps the best protection against col- lapsing endowments is to rely on different fund- ing models altogether. Some European business schools, such as the Monaco Business School at the International Uni- versity of Monaco, are supported completely by student tuition and fees. "We do not rely on an endowment or other forms of support," says Boris Porkovich, direc- tor of IUM's doctoral program. DeNisi agrees that "tuition will have to drive more of what we do." Already, some uni- versities are beginning to nudge their tuitions higher, adopting models that offer a more reli- able base of support during bad times. That, along with some creative problem solving, won't just pull business schools through the recession, says Yakoboski. It also will put them in stronger, more competitive posi- tions once they make it to the other side. To download the PDF of the TIAA-CREF article, "Managing Higher Educa- tion in Uncertain Times," visit www.tiaa-crefinstitute. org/articles/higher_ed_ uncertain_times.html. BizEd SEPTEMBER/OCTOBER 2009 43