Transcript Slide 0

Presentation to the Academic Business Officers Group
Peter Taylor, EVP and CFO
Cathy O’Sullivan, Director, Working Smarter
April 16, 2012
UNIVERSITY OF CALIFORNIA
WORKING SMARTER
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WORKING SMARTER
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Regents Policy 5100
“Resolution Regarding Administrative Efficiencies”
Approved at UC Regents Meeting – July 14, 2010
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Administrative and Operational Excellence
UNIVERSITY OF CALIFORNIA
Common, integrated systems for:
Finance and Payroll
Time & Attendance
Extramural Fund Accounting
Data Warehousing
Asset Management
E-Procurement
Energy and Climate Solutions
Indirect Cost Recovery
Library Efficiency Strategies
Risk Management
Sources: http://www.universityofcalifornia.edu/regents/policies/5100.html (July 14, 2010)
& Presentation to UC Regents Committee on Finance May 19, 2010
(http://www.universityofcalifornia.edu/regents/minutes/2010/fin5.pdf)
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WORKING SMARTER
Five Year Commitment (FY 10-11 thru FY 14-15)
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UNIVERSITY OF CALIFORNIA
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Redirect $500 million from administrative costs to
the academic and research missions;
Streamline operations to address state funding
cuts and the need for commonality among the
campuses;
Implement operational efficiencies that enhance
the quality of services to students, faculty and
staff;
Build a sustainable financial model to carry the
University forward.
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TRACKING PROGRESS: COST SAVINGS AND NEW REVENUE
$500
YEAR 5
$400
YEAR 4
$300
YEAR 3
$200
YEAR 2
YEAR 1
$100
$100
$0
GOAL ($M)
UNIVERSITY OF CALIFORNIA
$157
ACHIEVED ($M)
Year 1:
UC Campus Connexions
UC Travel Insurance Program
UC Equipment Maintenance Insurance
Statewide Energy Partnership
Enterprise Risk Management
Purchase Card Program
Liquidity Management (STIP/TRIP)
Source: Presentation to UC Regents Committee on Finance 7/13/11
http://www.universityofcalifornia.edu/regents/regmeet/jul11/f1.pdf
$ 4.2
$ 0.7
$ 0.6
$25.0
$82.9
$ 3.9
$40.0
$157
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WORKING SMARTER GOVERNANCE STRUCTURE
Executive Steering Committee
Advisory Group
Academic Senate, COC,
COVC, COVCA, CUCSA,
ITLC, Staff Advisor to Regents
Nathan
Brostrom
Mike
Gottfredson
EVP, Business
Operations
EVC and Provost,
UC Irvine
John Plotts
Peter Taylor
Tim White
SVC, Finance and
Administration,
UC San Francisco
CFO,
Systemwide CFO
Division
Chancellor,
UC Riverside
Cathy O’Sullivan
Director, Working Smarter
UNIVERSITY OF CALIFORNIA
Executive Sponsor
Project Owner
Functional Teams
Campus Managers
Project organization strategy to ensure engagement of key stakeholders
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WORKING SMARTER WEBSITE
UNIVERSITY OF CALIFORNIA
http://workingsmarter.universityofcalifornia.edu
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CURRENT WORKING SMARTER PORTFOLIO
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UNIVERSITY OF CALIFORNIA
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Analytical Writing Placement
Examination (AWPE)
ApplyUC
Banking & Treasury Services
Be Smart About Safety (BSAS)
Benefits Redesign
Campus Administrative Relief
Initiatives
CampusConnexions
Climate Solutions
Connexxus Travel Program
Coordinated Approach to
Indirect Cost Recovery
Data Improvement Project
e-Sourcing & Contracts Mgmt.
Enterprise Risk Management
(ERM)
Library Efficiencies
Liquidity Management
Mainframe Consolidation
Mandatory Training
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New Model for Legal Services
Parent Giving
Policy Project
Purchase Card Program
Regional Data Centers
Research Administration (Kuali
Coeus)
Statewide Energy Partnership
Strategic Sourcing
UC Equipment Maintenance
Insurance Program (UCEMIP)
UC Ready
UC Student Health Insurance
Plan (UCSHIP)
UC Tracker
UC Travel Insurance Program
(UC TRIPS)
UCPath (formerly Payroll
Personnel System (PPS))
University Controlled Insurance
Program (UCIP)
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WORKING SMARTER: Developing New Initiatives
• Copy-Adapt local restructuring/
efficiency or revenue initiatives
• Regional centers
UNIVERSITY OF CALIFORNIA
of excellence
• System-wide efficiency measures
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ADDRESSING BARRIERS
UNIVERSITY OF CALIFORNIA
UC Strategic Investment Program (UCSIP)
CapEquip
C3
STARs
(Capital Equipment
Financing)
(Cross-Campus
Collaborations)
(Strategic Teaching
Acquisition & Retention)
Purpose:
Equipment acquisition in lieu of
3rd-party leasing (including re-fi)
Regional centers of excellence,
systemwide efficiency initiatives
Lab renovations/equipment
specific to a single faculty recruit
Strategic
Goal:
Cut costs through economies of
scale inherent in UC debt
program
Cut duplication and increase
systems commonality
Maintain competitive research
and academic excellence
Size:
$200 million authorized/year
$20-$50 million authorized/year
$20-$50 million authorized/year
Structure:
Amortizing loans funded via CP
on reimbursement basis
Amortizing loans funded via CP
on reimbursement basis
Amortizing loans funded via CP
on reimbursement basis
Rate:
4% (subject to annual review)
0%
0%
Term:
3-7 years
3-7 years
11 years avg.
(15 renovations, 7 equipment)
Debt
Service:
Campus funds that formerly paid
third-party lease payments
Principal possibly paid by savings
(interest covered by program)
Principal possibly paid by ICR
(interest covered by program)
Awards:
Campuses submit authorization
requests annually to Regents
Campuses competitively apply
throughout the year
Campuses competitively apply
throughout the year
NOTE: Strategic funds accumulated by CapEquip segment will fund interest costs of the other two segments
Source: http://ucop.edu/finance/ucsip.html
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UNIVERSITY OF CALIFORNIA
LIQUIDITY MANAGEMENT
More Info: http://workingsmarter.universityofcalifornia.edu/projects/liquidity-management/case-study/
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BANKING & TREASURY SERVICES
• Goal: reduce the cost for UC banking services while
maintaining world class control and functionality
UNIVERSITY OF CALIFORNIA
• Background: UC incurs ~$25 M/yr for expenses related to
banking services for all campuses and medical centers
(depository, disbursement, payroll, merchant card accounts
and related transaction activities)
• Successes to date:
• Treasury Workstation:
• Merchant Credit Card Fees:
• Bank of America Account Fees:
~$960K/yr savings
~$675K/yr savings
~$218K/yr savings
More Info: http://workingsmarter.universityofcalifornia.edu/projects/banking-services/overview/
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MAINFRAME CONSOLIDATION
Across UC:
• 2004: 13 mainframes
• 2012: 9 mainframes
UNIVERSITY OF CALIFORNIA
2011 Pilot at UC Berkeley
UC Berkeley migrated a specific part of its workload to an
existing UC mainframe and turned off the local system,
resulting in $2M/year savings with no drop in service or
response time.
UC now has nine remaining mainframe locations and will
analyze the opportunity for further consolidations and
execute upon that analysis.
More Info: http://workingsmarter.universityofcalifornia.edu/projects/mainframe-consolidation/case-study/ 12
UC STUDENT HEALTH INSURANCE PROGRAM (UC SHIP)
• A comprehensive health plan provided through Student Health
and Counseling Centers, augmented by an extensive insurance
network
• Consolidated 11 separately managed plans (10 Campuses + UC
Hastings) into 1
• Began with Graduate Student offering in Fall 2010 at 6 campuses
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• Undergraduate Students incorporated into the system-wide plan in
Fall 2011, as well as graduate students on all campuses.
• UC SHIP will save the 120,000 participating students $8.4M in
premiums in the 2011-12 year. The plan incorporates strong
benefits from each of the existing plans, and students will
receive about $5.4M in new benefits.
More Info: http://workingsmarter.universityofcalifornia.edu/projects/student-health-insurance-plan/overview/
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UCPath
Shared Service Center FAQ
UNIVERSITY OF CALIFORNIA
1/21/2012
Business Process Mapping
FAQ - 2/22/2012
For More Information: http://workingsmarter.universityofcalifornia.edu/projects/ucpath/overview/
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Employees Served Per HR FTE
UCPath: 2010 Benchmarking Survey
186
200
180
UC
160
10th
50th
90th
140
120
• PWC conducted a survey for UC to
understand our workforce service
delivery capability
• UC fell short of industry standards
100
78
80
60
47
43
40
20
0
UC
UNIVERSITY OF CALIFORNIA
• More time is spent with transactional
activities, less time in performing
analytical work, and providing more
high quality administrative services
Industry Standard:
PricewaterhouseCoopers
UC FTEs Served Per Payroll/Timekeeping FTE
1891
2000
1800
1600
1400
1200
1000
UC
10th
50th
908
90th
800
600
326
400
200
99
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UC
Industry Standard:
PricewaterhouseCoopers
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UCPath Begins Implementation
• Cross collaboration teams representing all campus &
medical centers assist with the design solution
• Cross-functional design team determined scope of
services for the new UCPath Center
• Oracle PeopleSoft providing a systemwide solution to fit
the needs of campus and medical centers
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• Beginning data clean-up and conversion into new system
• Involve and inform all UC campus & medicals centers,
and offer feedback opportunities to deliver UCPath
More Info: http://workingsmarter.universityofcalifornia.edu/projects/ucpath/overview/
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Early Adopters / First Wave Implementers
• Implementation will take place in
several waves made up of small groups
of campuses/medical centers.
• Each wave is able to execute more
efficiently and effectively by building on
the experience and lessons learned in
the previous wave.
UNIVERSITY OF CALIFORNIA
●UCOP
• The “wave” approach:
• Manages risk
• Builds momentum
• Provides proof of success
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When UCPath is Complete…
• There will be a single payroll and HR solution for all
employees UC-wide.
• Employees will have access to their information and be
able to make changes via online self service.
• Dedicated customer support staff will provide accurate
and timely information by phone, email or chat.
UNIVERSITY OF CALIFORNIA
• Payroll processing will be real-time, automated, efficient
and accurate.
• HR, payroll and academic personnel transactional
processes will be simplified and consistent across all UC
locations.
• Consistent, quality data will be readily available to
improve analytical reporting, and decision making
• UC will deliver payroll and HR services at a substantially
lower cost than today
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