In the late 1980s and early 1990s, public universities found that they were no longer immune to the financial stress faced by their private sister institutions and corporate America. Budget cuts were in the air across the land. When the budget ax hit, the cuts often came without warning and their size was sometimes staggering. State support for some institutions dropped by 40%or more. Most university administrators had only experienced budget increases, never budget cuts. Also, the budget setbacks usually occurred at the most inopportune time during the school year when contractual commitments with faculty and staff had been signed, programs had been planned, and students were enrolled and taking classes.

Required:
Since these usually are not one-time-only cutbacks, how would you manage continuous, long-term reductions in budgets extending over a period of years?