Chancellor’s Campus Organization and Effectiveness team
DRAFT Interim Report
Co-chairs: Robert Greenstreet, John Reisel, Paula Rhyner, Kyle Swanson
The CCOET Support and Primary teams have met several times each in the past month. In addition, they have held four listening sessions and have created a website that has received over 400 suggestions and comments. The website also contains all information collected and generated by the Teams including all meeting minutes, Guiding Principles and Frequently Asked Questions. The four Chairs (Rhyner, Swanson, Reisel and Greenstreet) have also fielded dozens of individual e mails and have presented at various other forums, including two Chairs’ meetings and a Faculty Senate.
The Team has now received and has reviewed a considerable amount of data and input, much of it valuable and all of it posted on the website to ensure absolute transparency of the process. However, the discussions have been hard. Emotions are running high on campus and confusion, self-interest and suspicion are inevitably making any progress slow and painful.
Given the short timeline to produce recommendations, the four Chairs have attempted to summarize the primary points of discussion thus far that we believe can achieve the necessary campus budget reductions as well as best position UWM to move forward. They are not necessarily the most strategic or fair, but can yield the maximum amount of necessary savings with the least amount of complication, resistance and disruption in the time available while preserving the basic tenets of UWM’s mission.
In addition, we have added a number of secondary strategies that are worthy of consideration, either because of their ability to yield additional savings or because they will lead to continued discussion on campus reorganization that we believe is equitable and will strengthen the overall mission and effectiveness of UWM.
1. POSITION CONTROL
The Chancellor’s Campus Organization and Effectiveness Team (CCOET) at the University of Wisconsin-Milwaukee (UWM) has identified position control as one strategy that could be used to address its substantial structural deficit. The information included focuses on the: (A) Estimated Savings; (B) Consequences; (C) Best Practices; (D) Procedures to Minimize Damage to UWM’s Mission; (E) Incentives; and (F) Process for Implementation
Personnel costs are the highest budget item at any university. In order to control budget, the process to identify and create a complete organizational chart along with job descriptions, metrics for the positions, back- up training and plans for business continuity and development plans is usually the first step in position control. Position control refers to two ideas. The most common is the concept that the organizational structure is based on organizational positions. This control mechanism requires periodic review within departments, schools, and business service units to ensure efficient use of personnel. The second use of position control is budgetary. In this iteration, all open positions undergo a rigorous review and approval process. According to the Education Advisory Board (EAB), an institution can use the position control process to “…assess positions as they become vacant, reclaim staffing dollars when appropriate, and potentially redeploy staffing lines to other units with greater needs” (2014, p. 72).Thus, position control can be used to determine whether a vacant position should be filled in the same way, whether the position should be filled but re-defined, whether the responsibilities can be reassigned to currently filled positions, or whether the position should be reallocated.
Although position control should not be considered a permanent solution to the UWM structural deficit, it is a strategy that can be used to realize salary savings. In addition, it can be implemented as both a short-term strategy and a long-term strategy, albeit in different plans. Positions that are included in the implementation of position control are those for which the appointment is greater than one year.
A. Estimated Savings:
The salary savings to be realized via the implementation of position control will be somewhat of a “moving target,” depending on the vacant positions that are used to fill positions that are deemed “critical hires” and the salary that is allocated to those positions. In the short-term, it might be necessary to define a “critical hire” as one that fulfills a vital campus function. A long-term strategy to be consider is to establish a salary savings target annually during the budget building process. The salary savings target can be set for the campus as a whole as well as for individual schools, colleges, and other administrative units.
It has been estimated that cumulative salary savings could be as much as $20-30 million in FY16-18; however, replacement costs for the same period need to be calculated. Any salary savings will be off-set by the need for strategic hires that must occur within the next 2-3 years and temporary hires to meet critical instructional needs. UWM payroll data for the period October 2014-October 2015 show a payroll decrease of $10 million as a result of holding vacant positions open; however, such savings are not likely to be sustainable over time since the specific positions that will need to be filled are unknown. UWM data for the one-time savings for FY16 (budget lapse) reveal a net savings for salary and fringes for unfilled vacancies of $7.5 million.
Other factors must be considered in the implementation of position control, such as:
• Potential increases in administrative costs associated with position control
• The need for flexibility in terms of the time period designated to hold vacant positions open and the allocation of vacant positions across units
• The effects of position control on the growth of academic and research programs and the access mission of UWM
• The role of accountability in the allocation of positions
Additional information is needed with regard to the central management of position control. Examples of questions to be addressed include:
• Which individual or group will be assigned responsibility for central administration of position control? It is recommended that the proposed campus Resource Allocation Group or a similar shared governance group be involved in developing the position control criteria and shaping the position control process.
• In what ways will position control be incorporated into the new budget model for UWM?
• How will the criteria for short-term and long-term position control be determined? What constitutes an exception to the criteria?
• How will transparency regarding position control be ensured?
• What is the role of shared governance in position control?
• How will position control affect the ability of a unit to construct its annual budget and to reallocate funds as needed?
• What process will be followed for making counter offers as part of position control?
Negative consequences of position control:
• Holding positions open for a period of time as they are vacated is not strategic and can be punitive. For example, units with multiple individuals who are approaching retirement will be more limited in capacity because of the requirement to hold the vacated positions open for a period of time.
• Position control reduces the incentive for programmatic growth.
• Position control reduces the budgetary authority of deans and other unit administrators and their ability to creatively use salary savings for other needs of the overall operating budget.
• The time and expense required to recruit faculty and staff for approved positions will increase substantially.
Potential impact of position control on UWM’s mission:
• Some academic programs will not have sufficient faculty and staff to be sustained, resulting in the elimination or suspension of programs.
• The research mission will be negatively impacted when: (1) positions that support research are not filled; (2) unfilled faculty and instructional staff positions necessitate increased teaching loads for faculty and staff with research programs; or (3) researchers leave UWM for other universities and cannot be replaced.
• Accreditations for some academic programs are placed in jeopardy due to lack of sufficient faculty and staff.
• The reduction of resources will significantly diminish the capacity for student recruitment and retention efforts due to the loss of essential staff and increased time required to rebuild the staff.
Positive consequences of position control:
• Establishing a process to be followed in holding vacant positions open for a period of time and a set of criteria to be applied in the allocation of vacant positions leads to a common set of standards that is applied across units.
• Posting decisions on and justifications for position control, reallocations, recruitments, and counter-offers that are made centrally leads to increased transparency.
• Involving shared governance in developing the position control criteria and shaping the position control process facilitates transparency.
• Position control can lead to increased accountability for decisions related to recruitment and retention.
C. Best Practices:
The EAB (2014) provided information on practices related to the use of position control for non-faculty positions as a strategy to prioritize resources for various universities, including Webster University (St. Louis, MO), The College of St. Rose (Albany, NY), University of Alaska Fairbanks (Fairbanks, AK), University of Virginia (Charlottesville, VA), and Renesselaer Polytechnic Institute (Troy, NY), University of Windsor (Windsor, Ontario), Texas State University (San Marcos, TX), Alfred State College (SUNY College of Technology), Illinois Institute of Technology (Chicago, IL), Creighton University (Omaha, NE), Glendale Community College (Glendale, AZ) and the University of North Florida (Jacksonville, FL). Each university reported using position control practices to better manage staffing costs and to effectively address the mission of the university. In each case, when a position becomes vacant, the position could be subject to a mandatory “hold open period” and might not be “blindly backfilled” (i.e., filled as it had been). Although the described practices have been applied to non-faculty positions, it is important to note that the practices can be applied to faculty positions as well. In fact, faculty vacancies typically have an inherent one-year hold open period that is due to the recruitment process. Additionally, the described practices do not directly address reallocation of positions across units.
In the practice of a mandatory hold open period, the university holds all vacated, non-faculty positions open for a specified amount of time (typically 2 to 4 months) to capture one-time salary savings and to allow for a review of the position to determine the need for the position as it had been designed or the need to redesign the position. The practice includes the following components: (1) Establish the duration of the hold open period, which allows time to realize salary savings and review of the position and responsibilities, and (2) Determine exceptions to the hold open period because of safety or efficiency concerns.
A second practice identified by the EAB (2014) is the vacancy-triggered role redesign, in which any “as-was” non-faculty position request (a request to fill a position exactly as it was) is placed on hold and the unit leader is required to consider ways to efficiently redesign the role, including automating, eliminating, or reassigning associated tasks. Such a practice leads to a systematic review of staffing options and of roles and responsibilities and can be viewed as an opportunity to enhance efficiency and productivity.
A third practice is the use of a standardized requisition form. Such a form goes beyond the standard forms that are required for recruitment requests and would focus on the criteria that are established for the position control process. Examples of forms that have been used at other universities can be found in the EAB (2014) document, Business Affairs Forum.
A final practice described by the EAB (2014) is that of creating a salary savings target that is to be accomplished via the vacancy review process and achieved through a combination of holding positions open for an established period of time, redesigning roles, and eliminating some unnecessary positions. Such a practice can involve determining a salary savings target annually for campus as well as for individual schools and colleges and other administrative units.
D. Procedures to Minimize Damage to UWM’s Mission:
It is important to realize that the practice of position control is not a complete or absolute hiring freeze but rather, can be implemented in ways that allow for flexibility, transparency, and accountability in the budgetary process, particularly as the process pertains to reviewing and filling vacant positions. A complete hiring freeze, if warranted, should be used for a limited period of time to minimize the negative effects on UWM’s teaching and research mission. Additionally, the position control process should incorporate practices that will lead to programmatic innovations, alignment of positions with program goals, enhanced revenue generation, and increased efficiency of operations. Clear guidelines for position control and exceptions must be developed and applied consistently to ensure transparency. The same applies to the process of making counter offers for retention purposes. All decisions regarding the recruitment for or reallocation of vacant positions must be based in the guidelines and posted along with the justification for the decisions and made available to the campus community.
Some incentives to consider include: (1) allowing a small percentage of the salary savings from holding a vacant position open to be retained by the unit; (2) tracking what a unit has given up over time and taking that into consideration in making decisions centrally pertaining to position control; and (3) developing strategies to assess and reward programmatic growth.
F. Process for Implementation:
The process for implementation of practices pertaining to position control must ensure that the practices are in alignment with the launch of the new budget model. In addition, the process must include both short-term strategies and long-term strategies. As a short-term strategy, all faculty and staff positions that become vacant due to resignation, retirement or death will be subject to the campus position control process. The short-term strategy should be in place for no more than 3 years.
As a long-term strategy, position control will be managed via budgetary salary savings targets that are determined annually during the budget planning process for each unit and managed by the unit administration in collaboration with campus administration. The idea of a long-term strategy with position control would be to capture short-term savings through payroll savings targets. This would make position control one tool used by the University on an as-needed basis to balance budget. This strategy intertwines with the new proposed budget development process (attached). The bottom “lane” labeled Resource Allocation Group would develop guidelines, having one of them be the tool of position control. As projections are developed, estimates would preliminarily guide the resource allocation group to determine if payroll savings targets will be required to balance our overall budget. While estimates change as we go into the budget year, an adjustment window/time period would be most ideal as a one-time target shift to realign to actual vs. estimates related to payroll saving targets. This process hinges on the approval of the proposed new budget model, which is preliminarily projected to start in Spring 2016 for the budget development of FY 2018 (Fall 2017/Spring 2018). The process must ensure transparency and consistency with regard to the development and application of criteria and justifications for opening positions for recruitment and making counter offers. All recruitments and justifications will be published on the CCOET or similar website.
2. ADMINISTRATIVE ORGANIZATION AND BALANCE
It is unclear whether UWM’s current administrative structure effectively supports the campus mission and size. The current administrative structure should be re-examined, particularly with an eye towards placing the entire student experience (recruitment, admission, financial aid, enrollment, retention, career services and graduation) under a single entity and reducing administration levels along with the overall intensity of administration as a proportion of campus activities, perhaps using the 2010 Goldwater Study as a benchmark. Re-organization consistent with supporting other aspects of the mission (research and community service) should be likewise explored.
This should be coupled with accelerated implementation of a new shared services model with target data FY18 which should drive administrative efficiency to levels consistent with UWM’s aspirational peers. The balance of administrative and secondary support to academic activities should be published annually.
Estimated savings: $5-9 million annually by FY19
3. CAMPUS REORGANIZATION
Providing a workable framework supporting reorganization of academic and administrative units, emphasizing flexibility, cross-unit fertilization and efficiencies of scale. Some of these have originated within the units themselves and some may extend beyond the boundaries of the campus. Some have been prompted by current vacancies, others by the opportunities presented by interdisciplinary enrichment.
These discussions, which should be primarily driven by academic and not economic reasoning should be accelerated to create a better aligned, differentiated and more focused array of academic and administrative units. Incentives to drive reorganization should be built into the new budget model (e.g., credit sharing between units of enrollment and instruction; incentives for the combination of support and/or advising between units; incentives for early-career student success; etc.).
Estimated savings/revenues: $7 million by FY20
OTHER OPPORTUNITES FOR CONSIDERATION:
A. REDUCTION OF CENTERS
A rigorous review of all campus centers and institutes based upon output and alignment to UWM’s mission. Some of this reduction has already begun.
Estimated savings: $2 million
B. TEACHING LOAD EQUITY
Faculty workload policies should be re-examined with an eye towards developing a flexible minimum workload model (for example, along the lines of the University of Texas System). This would provide more effective usage of faculty resources while directing individuals towards institutionally productive use of their collective time.
Estimated savings: $1 million
C. SEGREGATED FEE REDUCTION
All expenditures made under Segregated Fees should be scrutinized and reduced with the intention of cutting the fee charged to students. While this does not directly affect the budget shortfall, it demonstrates an equity of economic effort across the whole campus and makes recruitment easier. All future hires should be published on the CCOET website.
Estimated revenues: Data from the State of Colorado System suggests an increase of %9.1 in admissions/enrollment for each $1000.00 reduction in tuition/fees. Hence, a $200.00 reduction in Segregated Fees may generate as much as a 1.8% increase in tuition ($3.6 million).
As the budget deficit is eased, a campus fund should be established to provide funding for growth areas, important initiatives directly focused on enrollment and the campus mission and faculty, staff and graduate student compensation.
E. CREDIT PLATEAU
The current plateau for both the undergraduate and graduate levels should be reviewed for conformance with national norms. Even a modest increase in each plateau would make a substantial addition to tuition income.
F. CAMPUSWIDE FURLOUGHS
As a last resort, temporary savings can be achieved at a rate of $1 million each year for every day of furlough. Furloughs do not have to be administered equally across rank or pay rate.
SUB COMMITTEES for discussion of primary areas of discussion:
Administrative Organization and Balance