Last autumn, as the financial markets were going into free fall, University of Michigan CIO Erik Lundberg received a gift from one of the school endowment fund’s British asset managers. It was a reproduction of a poster created during World War II to help the British people maintain their famously stiff upper lips should the German army invade England. “Stay calm and carry on,” the poster reads. Lundberg immediately taped it to his office door.
“When things were falling apart, people were very concerned,” recalls Lundberg. “They wanted to know what was going on, what would happen to the endowment and to their jobs.”
For a look into a possible future for U.S. colleges and universities, search no further than this institution in Ann Arbor, Michigan. Well into a seven-year, campuswide austerity program, the Big Ten school has been in recession mode since 2002, says CFO Timothy Slottow. He has been implementing a reduction, now totaling $135 million, in recurring expenditures for much of this decade. “We never felt flush even in the flush times,” explains Lundberg. It’s precisely that mentality that has kept the school from hitting the rocks in rough waters. ....