E&I Article, Featuring our Contract Partner, Huron

Transformation starts from within. That was the philosophy of the University of Pittsburgh athletic department, a sports powerhouse with 19 Division I programs and nearly 470 student-athletes who compete in the prestigious Atlantic Coast Conference, when it hired Huron to evaluate its long-term financial model within the context of broader industry trends and peer performance.

Due to inconsistent accounting and financial reporting across institutions, it is often difficult for athletic departments to compare their own spending and financial performance with those of peers. Now more than ever, in this era of increased turbulence in college athletics, this knowledge is critical to developing responsible financial plans.

Heather Lyke from Pitt Athletics discusses working with peers. Ms. Lyke mentions that ACC peers are working together as colleagues more than competitors, even though teams compete on the field. Teams should work together on solutions, working together to work on what is best for college sports, and positive change. Pitt athletics mentions the need to evolve in changing times.

 

Huron helps Pitt by critically analyzing spending, and comparing to competition

Leaders in Pitt Athletics knew that to achieve more athletic success it needed to understand peer spending. Pitt athletics worked with Huron to establish its objectives, embarking on a 3-month project defined by two initiatives:

  • Budgetary benchmarking and normalization: Huron developed an objective set of budgetary benchmarking data for Pitt Athletics through normalization efforts in coordination with a select group of peer institutions within and beyond the Atlantic Coast Conference.
  • Financial model assessment: Huron collaborated with financial leadership in athletics and at the university level to generate a comprehensive and objective set of forward-looking financial projections for the department and a customized modeling tool for enhanced financial forecasting.

The budget normalization initiative included developing benchmarking data from five peer institutions spanning all major revenue categories (scale and source), operational efficiency, university support, and more. Athletics-specific financial data were adjusted to standardize accounting practices across peers, enabling more accurate and meaningful observations and highlighting relative financial performance. Pitt was looking for more actionable information instead of raw data. Financial modeling helps produce forward-looking financial projects for the athletic department.

The financial modeling initiative synthesized Pitt’s financial data to produce forward-looking financial projections for the athletic department. Huron, in collaboration with Senior Associate Athletic Director Ryan Varley, forecast multiple scenarios based on possible future outcomes and provided a new, data-informed template for making critical funding and investment decisions.

As Pitt seeks to sustain and enhance its leadership position in a rapidly evolving industry landscape, its new financial modeling tool and the related normalized benchmarking data will enable the university to forge a roaring future for the Panthers.


This is just an executive summary. See the full story with Pitt and Huron.

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