Navigating Disruption: Strategic Change Management in Higher Education

Higher education is undergoing one of the most consequential periods of transition in decades. Pressures are coming from every direction: federal policy shifts, declining demographics, athletics revenue redistribution and the urgent demand to modernize operations through artificial intelligence and digital tools.

For finance and administration leaders, this convergence requires a disciplined approach to higher education change management while safeguarding mission and long-term viability.

Federal Funding Cuts: The Research Squeeze

Research institutions in particular are facing a new set of funding risks. Proposals to cap indirect cost recovery rates on federal grants could significantly reduce the resources available to support faculty research and institutional infrastructure. At the same time, discussions of rescinding or impounding appropriated funds create uncertainty for institutions heavily dependent on federal grants and contracts.

The implications extend beyond research administration offices. Reduced federal dollars can impact graduate programs, facilities investment and cross-subsidies that support teaching and student life. For leaders, the challenge is twofold:

• Scenario planning and risk modeling to understand the budgetary consequences of funding volatility.
• Diversification of research funding streams (including private partnerships, philanthropy and state-level initiatives) to buffer against federal reductions.

Without deliberate planning, sudden shifts in federal support could undermine not only research competitiveness but also the financial stability of the broader institution.

Enrollment and Athletics: Two Sides of Revenue Pressure

While research funding is under scrutiny, institutions are also bracing for the long-anticipated enrollment cliff. With fewer high school graduates projected in the coming years, universities will face intensified competition for students, thinner tuition pipelines and heightened pressure on discount rates. Retention strategies, program realignment and new credential pathways will all be critical levers to sustain enrollment and stabilize revenue.

At the same time, athletics — a defining feature of higher education — faces its own disruptive forces. Revenue-sharing models are under negotiation, and the potential for institutions to subsidize athlete payments is fundamentally reshaping the financial calculus for athletics departments. Rising costs related to compliance, facilities and student-athlete services further compound these pressures.

Enrollment and athletics, in fact, are inseparable pressures that demand coordinated management. Athletics often functions as a brand amplifier that can influence prospective student interest and institutional visibility, while enrollment trends directly affect the resources available to sustain athletics programs. When institutions face declining student numbers while athletics finances are under pressure, leaders must actively manage how these forces interact.

Budget planning must account for athletics as an integral part of the institution-wide financial model instead of serving as a separate enterprise. This requires transparent communication with stakeholders, scenario planning that accounts for both enrollment and athletics together, and governance structures that mitigate one area’s challenges from destabilizing the other. By managing this deliberately, institutions can avoid reactive decision-making and position athletics as a constructive part of broader enrollment and financial strategies.

Digital Transformation, AI and the Resource Gap

Layered on top of financial and demographic pressures is the accelerating push to modernize. Boards and stakeholders increasingly expect institutions to leverage AI, automation and digital solutions to drive efficiency, enhance student services and compete for enrollment.

Yet many institutions lack the financial, technical or human capital resources to carry out these transformations successfully. Cloud migrations, AI-powered advising platforms and predictive analytics all carry significant costs; without proper governance, projects risk overruns or underperformance.

This resource gap underscores the importance of:

• Prioritization: Determining which digital initiatives are mission-critical versus aspirational.
• Governance: Establishing cross-functional oversight to evaluate risks, ensure alignment, and measure outcomes.
• Capacity-building: Investing in training and change management so faculty and staff can adopt and sustain new technologies.

Modernization is not optional, but it also can’t be pursued indiscriminately.

A Framework for Leading Change in Higher Education

Working through today’s disruptions requires more than ad-hoc adjustments. It demands a structured, transparent and adaptive approach to institutional transformation. Frameworks such as ADKAR (Awareness, Desire, Knowledge, Ability, Reinforcement) provide a practical lens for higher education leaders to not only design change but also ensure it is adopted across the campus community.

Several key elements are involved in this approach.

Clear diagnosis of institutional pressures

Institutions should begin by building awareness of the drivers of change, whether it’s volatility in funding or pressures to invest in new expenditures. This diagnosis should be data-driven and communicated in plain terms so stakeholder can understand why change is necessary.

Governance and accountability structures

Building desire to act requires confidence that decisions will be made consistently and fairly. Clarifying who makes decisions, who monitors progress and how conflicts are resolved helps create transparency and momentum. A well-defined change council or steering committee signals that the institution is serious about coordinated action, not isolated fixes.

Transparent stakeholder engagement

Successful adoption requires broad knowledge of what change means for different groups. Regular communication with faculty, staff, students, donors and other stakeholders ensures alignment. Engagement should be two-way; leaders should both deliver information and gather feedback through forums, surveys and advisory groups. This builds trust and brings risks to the surface early.

Building ability through resources and support

Knowledge alone is insufficient without the ability to act. Institutions must provide training, tools and resource support to ensure stakeholders can carry out new processes or responsibilities. For example, digital transformation initiatives should include training for faculty and staff, while athletics or enrollment changes may require new financial planning models or data systems.

Measurement and feedback loops

Change endures when it is continually reinforced. Leaders should track adoption metrics, financial impacts and unintended consequences, then use this data to celebrate wins, address barriers and adapt strategies. Dashboards, regular progress reviews and visible leadership reinforcement help sustain momentum long after initial enthusiasm wanes.

Equity and mission focus

Across all phases of change, leaders must anchor decisions in the institution’s mission and values. This ensures changes (whether reallocating research funding, restructuring athletics budgets, or deploying new technologies) don’t inadvertently undermine access, affordability or student success.

Moving Forward with Confidence

For higher education leaders, the challenge is not to manage one isolated change at a time but to navigate multiple intersecting shifts in policy, finance, demographics, athletics and technology. By applying disciplined change management principles, institutions can maintain stability, protect their missions and seize opportunities for innovation, even in times of disruption.

The institutions that thrive are led by decision-makers who don’t wait for change to happen to them; they shape it. By partnering with James Moore’s higher education CPAs and consultants, you gain the insights, tools and support to turn disruption into opportunity. Strengthening your financial strategies and accelerating your change management efforts will help you lead with confidence and keep your institution’s mission at the center.

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