| Confronted with a daunting mix of challenges during difficult economic times, liberal arts colleges require extensive institutional adjustments in order for them to survive and even grow stronger in pursuit of their educational mission. These institutions are called on to demonstrate increased financial discipline in response to the significant growth in higher education costs as well as an ability to react more quickly to swiftly changing educational needs. In response to these pressures, many liberal arts colleges are refining their institutional business model, such as pursuing alternative revenue sources and reducing administrative expenditures. Beyond these changes, some institutions must go even further and make reductions in their academic costs in order to ensure long term survival.;Two models of retrenchment from the business literature, "resource dependency" and "resistance to change", are used to perform a detailed analysis of the academic cost reduction strategies and processes of liberal arts colleges. These frameworks offer two different and complementary views of cost reduction processes, with the first focused on external pressures, and the second focused on internal community members and their roles in and reaction to institutional change.;Using a single-site case study of academic cost reduction at a liberal arts college, the institution's processes are analyzed to confirm the relevance of the two frameworks. The findings suggest that liberal arts colleges can and should successfully employ many aspects of these two frameworks, although there are elements in higher education, such as enrollment management strategies, that require re-definition of the model's corporate structure. Components of the frameworks such as buffering the core-mission aspects of the institution and reducing resistance to change through well-planned and executed communication strategies show great value to the liberal arts environment undergoing financial stress. These findings are valuable to both the liberal arts and broader higher education communities in taking relevant lessons from the business environment to devise effective cost reduction processes that strengthen institutions and support their missions. |
