Drivers of Strategic Management: Implications for Strategic Financial Management in Higher Education Institutional Context

Abstract

Most Higher Educational Institutions (HEIs) have in the past been largely managed without recourse to a systematic and integrated approach to financial strategy. This has largely been so since the sector has been regarded primarily as a publicly-funded service and the fact that HEIs have fewer financing requirements (and options) and face fewer acute financial risks. However, in recent times, it has become clear that to succeed financially and academically, HEIs must be a more proactive and strategic approach to the management of their finances in the long term. Proceeding from this backdrop, the present paper aims to assess the drivers of strategic management and examine their implications for the strategic management of finances in the context of universities. The paper adopts the conceptual and theoretical research approach. Through a review of the literature on the drivers of strategic management, the authors synthesize various theoretical perspectives and draw their implications for strategic financial management in universities. It is inferred from the study that leadership, communication, resource allocation, and monitoring and review of strategic plans are the factors that are cardinal to strategic financial management in universities. The study culminates by proffering recommendations for policy and practice in the area of university strategic financial management. Among other measures, it is recommended that the leadership of universities including Governments, Directors of Finance, and academic unit heads must aim to develop a financial strategy that aligns with the mission and vision of their institutions, communicates financial strategy across various institutional units, and regularly monitor the effectiveness of financial strategic plans and revise where necessary.