Financing higher learning through endowment: The efficacy of Harvard Hybrid Model

As higher learning institutions increasingly find themselves having to grapple with the grave challenge of generating their own financial resources to support their everyday operation, endowment frequently surfaces as a pragmatic way to cope with the soaring costs of managing human resources, hiring experts, providing maintenance, and financing research and extension. This paper examines the endowment practice of Harvard University which success other universities in the United States have tried to imitate albeit with varying results. Using secondary sources of information the hybrid model of Harvard Management Company was analysed. The Harvard model revealed two important instructions: endowments must be tailored to fit local capacity and capability, and endowments must be managed by experts specialized in financial investment and assisted closely by academicians and administrative teams. Such hybrid cooperation in endowment management has enabled Harvard to accomplish its missions including granting scholarships, reducing tuition fees, and educating and transforming ordinary people into extraordinary achievers.