university of california new business architecture project 2010 jan00 meeting notes.doc april 15,...

Project 2010 Jan00 meeting notes.doc

University of CaliforniaUniversity of CaliforniaNew Business ArchitectureNew Business Architecture

April 15, 2004

Accelerating the New Business Architecture

UC Employment Managers Meetingat UC San Diego



The New Business Architecture for UC



Page 7 of ReportPage 7 of Report

Provide integrated access to Provide integrated access to business transactions, policies business transactions, policies

and trainingand training





Establish UC as a Establish UC as a competitive employer and competitive employer and provide staff the tools to provide staff the tools to

improve productivityimprove productivity





Redesign processes to Redesign processes to improve our efficiency improve our efficiency

and effectivenessand effectiveness





Invest in technology to Invest in technology to replace manual, paper-replace manual, paper-based work processes based work processes




of ReportPage 7 of Report

Improve integration of Improve integration of and access to financial and access to financial

datadata




Incorporate metrics to Incorporate metrics to improve performance and improve performance and

manage riskmanage risk




Budget reductions – Focus in 2004

• Managed Risk: address the increasing risks associated with long term under-funding of institutional support

• Cost savings: maximize the return on institutional support investments

• Collective solutions: recognize the need to solve campus problems once (not ten times)

• Greater leverage: leverage UC size and purchasing power

• Flexibility: accelerate New Business Architecture solutions which enable UC to accommodate both growth and downsizing without compromising service levels

• Regulatory burden: lessen the cost and administrative impacts of regulatory compliance

New Business Architecture strategies today include:



The UC budget has grown since the late 1980’s…

Dollars in

Thousands

0

2,000,000

4,000,000

6,000,000

8,000,000

10,000,000

12,000,000

14,000,000

16,000,000

18,000,000



…While institutional support has declined in proportion to UC’s budget

0%

2%

4%

6%

8%

10%

12%

14%

Inst

. Sup

port

as

% o

f Exp

end.



Department Administration (Academic, Clinical, Auxiliary)

Central Offices

(Payroll, HR,

Travel))

The majority of campus administrative costs are in departments...

…Reducing administrative costs requires a comprehensive view of administrative services



An example from UC San Diego:Streamlining the Management of Grants

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003

Nu

mb

er o

f A

war

ds

0

20

40

60

80

100

FT

E

Number of Awards

Actual FTE



An example from UC Irvine:Streamlining Student Processes:

STUDENTS ASSISTED PER FINANCIAL SERVICES' FTE

0

1000

2000

3000

4000

5000

6000

FY 1993 FY 1995 FY 1997 FY 1999 FY 2001 FY 2003

FISCAL YEAR

ST

UD

EN

TS

AS

SIS

TE

D P

ER

F

TE

0%

10%

20%

30%

40%

50%

60%

70%

80%

PE

RC

EN

TA

GE

WO

RK

LO

AD

IN

CR

EA

SE

Students/FTE

% Change



An example from UCLA:Streamlining Accounting Processes

Transactions and Staffing

050

100150200250300350400

Sta

ff F

TE

01,000,0002,000,0003,000,0004,000,0005,000,0006,000,0007,000,0008,000,000

Tran

sact

ions

Staff FTE # of Transactions



New Business Architecture: Doing more via the Web

• Business and student portals for information delivery

• Employee benefits enrollment

• HR processes

• Training

• New financial reports in support of GASB accounting



• Employee self-service : Eliminating paper processes and staff intermediaries for employee information – Your Benefits Online-- Open enrollment costs

reduced $125,000/year– UC For Yourself

• $700,000 annual savings will result from putting W2’s and direct deposit statements online

New Business Architecture: Doing more via the Web



New Business Architecture –

Developing common solutions

• UC-wide system for reporting effort on federal contracts and grants

• Multi-campus e-procurement initiative

• Borrowing the best ideas from corporate partners such as Gartner Group, IBM, Cisco, Microsoft, and others

• Joint campus development of business content for the web

• Common authentication framework across campuses



Cost Reduction Strategies & Challenges for Facilities

• Strategic management of energy resource dollars – Direct access energy contracts saved UC over $40 million since 1998 – Cogeneration and Thermal Energy Storage are also being used by

campuses to save energy dollars

• Risk to facilities from under-funding on-going maintenance ($45M), and no funding of new space ($5.9M in 03/04, $14.9M in 04/05)

• Half of UC’s 103.5 million gsf of space is State-eligible

• Need for $200M/year in capital renewal to avoid much larger costs in the future (no $’s since 01/02)



• Strategic Sourcing – UC-wide spend diagnostic and procurement teams for 20

top commodity groups

– Targeted savings and cost avoidance on vendor contracts: $34 million in 03/04, $46 million in 04/05

• Expected cost savings on consulting contracts

• External Debt restructuring using General Revenue Bonds has resulted in PV savings of $53 million

Leveraging UC’s Size and Strength



• Health & safety legislation

• Privacy/personal information legislation

• HIPAA & GLB compliance

• Patriot Act compliance

• New GASB financial reporting procedures

• OMB Circular Certification requirements

• SEVIS compliance

• Federal cost accounting standards

• High Workers’ Compensation costs

UC’s regulatory burden and costs increases affect ability to manage those costs



Regulatory increase over the last ten years

Comparison of Regulatory Environment - 1990 vs. 2003

0

10

20

30

40

50

60

70

80

90

1990 2003 1990 2003 1990 2003 1990 2003

Accounting EH&S Procurement Human Resources

Regu

latio

ns a

nd S

tatu

ator

y M

anda

tes

FederalState



• Restructure the process for delivering capital projects and revise the rules for competitive bidding

• Streamline State rules for claims submission and contracting with State agencies

• Provide UC with greater flexibility in payment methods for employees

• Seek relief from certain regulations that impede the mission of UC

Target opportunities for legislative and regulatory change



Staff Salary Competitiveness Poses Risk

-4%

-2%

0%

2%

4%

6%

8%

10%

1992-93 1995-96 1998-99 2001-02

UC Staff Salary Increase Funding Market - Western Region

% I

nc

rea

se

/De

cre

as

e i

n S

tate

Fu

nd

ing

fo

r S

taff

Sa

lari

es

Source: WorldatWork, "Annual Salary Budget Survey"

2003-04



In Closing

• Budget Reductions and increased workload will pose significant challenges to UC’s already lean infrastructure

• The New Business Architecture effort is implementing a series of initiatives that will require key investments in technology and collaborative strategies to reduce costs and increase productivity

• Our greatest risks are in under-funding staff salaries and facilities

university of california new business architecture project 2010 jan00 meeting notes.doc april 15,...

Documents

jan00 meeting

uc slide

business transactions

uc budget

uc san diego slide

leverage uc size

ucs budget slide

thous ands slide