If You Can’t Measure It, You Can’t Manage It

NACAS 46TH ANNUAL CONFERENCE MONTREAL, CANADA OCTOBER 5, 2014

Panelists

• Tom Strange , President/CEO – The Solution Design Group, Inc.

• Angela Joyce, Director of Client Services – The Solution Design Group, Inc.

• Mark Ironside, Executive Director of Business Services – Lehigh University

• Mark Reeves, Asst. Vice-President for Business and Auxiliary Services – University of West Georgia

• Alex Posivenko, Financial Manager, Auxiliary Services – University of West Georgia

• Rebecca Brown , Asst. Vice President of Admin Affairs – Florida A&M University

• Malinda Moore, Associate Director of Business & Auxiliary Services – Florida A&M University

Learning Objectives

• Gain a better understanding of benchmarks and how they can be used in auxiliary/business

• Learn about the tools being used to measure and present benchmarks

• Explore methods and techniques for comparing auxiliary efficiencies among peers

35% of College and University CFOs say the quality of analytics and

benchmarking information used to guide decision-making at their

institutions is either “extremely poor” or “below average”.

The Chronicle of Higher Education, June 2014 Survey

Performance Measures

• Why Measure? To learn and improve!

What is working? What isn’t working? What can we change?

• What to Measure? Performance indicators!

How much? How well? At what level? Over what time period?

• What do we want out of it? Improvements!

Can we increase revenue? Can we lower costs to students? Can we improve customer satisfaction?

The Basics

What is a Performance Measure?

“A quantifiable indicator used to assess how well an organization or business is achieving its desired objectives” – www.businessdictionary .com

What is a Benchmark?

“Standard used as point of reference for evaluating performance or quality”

• Internal – within your institution

• External – with other higher-educational institutions

• Functional – with institutions in other industries

Performance/Benchmarking Examples

• Lehigh University

• University of West Georgia

• Florida A&M University

Lehigh University

• Founded: In 1865 by Asa Packer, an industrial pioneer, entrepreneur and philanthropist; located in Bethlehem, Pennsylvania

• One of nation’s premier research universities

• 4 Colleges: Arts and Sciences, Business and Economics, P.C. Rossin College of Engineering, Applied Science and College of Education

• Student Body:4,904 undergraduates , 2,165 graduate students

• Lehigh Endowment : $1 Billion

• Athletics: 25 NCAA Division I intercollegiate sports for men and women, 40 intramural and club sports

Metrics Used:

• Ticket Fees

• Convenience Fees

• Order Fees

• Number of Tickets Sold

• Location

Benchmarking at Lehigh Example 1: Ticketing Revenue and Expenditures

Metrics Used:

• Overall Attendance

• Attendance by Residence

• Attendance by Class

Benchmarking at Lehigh Example 2: Student Participation

Metrics Used:

• Packages

• Mail

• Delivery Time

• Revenue

• Carrier

Benchmarking at Lehigh Example 3: Mail Services

University of West Georgia

• Founded in 1906, located in Carrolton, Georgia on 645 acres

• Fall 2014 enrollment – 12,150

• 76% full-time students; 24% part-time students

• 65% female; 35% male

• Degrees

• 9 Undergraduate degrees in 43 programs

• 9 Graduate degrees in 23 programs

• 4 Doctoral

Benchmarking at University of West Georgia Self-Op Bookstore Operations

Metrics:

• Margins

• COGS

• Freight Costs

• Labor Costs

• Labor Overtime

• A/R

• A/P

• Order Quantity

• Pricing

• Inventory Levels

Textbook Price to Students

Industry Trend

Textbook Price to UWG Students UWG Bookstore vs Industry Trend

FY2010 2011 2012 2013 2014 Fall 2015

100%

90

80

70

60

50

40

30

20

10 %

$54 $55 $58 $62 $65 $67

$54 $55 $58 $62 $65 $67

Florida A&M University • Founded in 1887, located in Tallahassee, Florida

• 10,200 students from more than 30 states, many countries

• Accredited by Southern Association of Colleges and Schools; offers 98 degree programs, including 12 doctoral degrees

• Top 10 Best Historically Black Colleges or Universities in the nation - U.S. News and World Report (2014)

• A “Best in the Southeast” College - The Princeton Review (2014)

• College Database – grads earn average salary $41,000/yr; ranked No. 4 in Florida (2013)

• On Forbes list of top colleges in the U.S. (2013)

Benchmarking at FAMU Background: Housing, Student Meals

• Direct correlation: Housing – Student Meals

• Fall 2014, 5 of 13 housing facilities taken off line (899 beds)

• New facility opened (800 beds)

• Fall 2014 – 2,914 meal plans; 60% mandatory (resident), 40% commuter

• FAMU sells meal plans, collects revenues, then pays provider

• Recent challenges: switching providers, declining enrollment and meal plan participation, closure of facilities

• Purpose: Project revenues for planning, and budgeting

• Description: Analyze meal plan enrollment, rates based on projected participation

• Metrics Used: Student population/enrollment, housing occupancy rate, % of students on meal plans

• Use of Data: Prepare operating Budget, fulfill financial commitments, assess meal plan performance, project growth

• Results : Meal Plan Participation, Revenue increases; more appealing meal plan types; improved customer satisfaction

Benchmarking at FAMU Example 1: Meal Plan Revenues to Student Enrollment

• Purpose: Assess performance of each dining location

• Description: Determine effectiveness of food concepts, programs, promotions; monitor budgeted to actual sales revenue

• Metrics Used: % increase/decrease to prior year sales, budget-to-actual sales

• Use of Data: Comparison of current period sales revenue, by premise, to prior year

• Results : Used in decisions on staffing, branding, hours of operation, marketing, premise closure

Benchmarking at FAMU Example 2: Evaluating Sales per Premise

Benchmarking at FAMU Dining Sales Comparison – Prior Vendor to New Vendor

Benchmarking at FAMU Beverage Vending Profit-per-Student

Steps to Implement Benchmarking

Define Goals

Define Metrics

Collect Data

Analyze Data

Monitor, Adjust

• Data, descriptors • Frequency

• POS system • Card system •Vendor reports •Spreadsheets •Systems

• Targets • Timeframe

• Internal benchmarks • External benchmarks •Functional benchmarks

• What is achievable? • Modify products, services, pricing, operations, etc.

• Auxiliary revenue per FTE or FT student

• Auxiliary expense per FTE or FT student

• Profit margin

• Growth/Contraction percentages semester-to-semester

• Efficiency ratio

Benchmarking Overall Auxiliary Performance Benchmarks

• Revenue/expense per student

• Profit/loss per student

• Meal plan revenue per resident student

• Restaurant/franchise revenue per student

• Transactions per hour per location per day of week

Benchmarking Campus Dining Metrics

Revenue Benchmarking

Monthly Net By Premise

Year-to-Year

Revenue Benchmarking

Monthly P&L Detail

By Premise Year-to-Year

Operational Benchmarking

Transactions

Per-Hour By Day of Week

• Revenue per student

• Revenue by product category per machine

• Revenue by location type (e.g. academic, athletic, residential)

• Analysis of product sales/growth in different times of year

• Cash vs. Campus card sales

Benchmarking Campus Vending Metrics

• Sales and growth by Product Category

• Sales per square foot of retail space

• Sales per student

• Sales by Product Category by Campus (if applicable)

• For self-op, net revenue per student (sales less expenses)

Benchmarking Campus Bookstore Metrics

Audience Questions, Comments

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