Mid-Atlantic Regional Oracle/PeopleSoftHigher Education User Group (HEUG)

June, 2010

In Pursuit of Efficiency in Ohio’s University System

Initiatives supported by The Ohio Board of Regents and the Lumina Foundation for Education

Efficiency in Ohio’s University System: Agenda

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Introductions

Context and Background

Project Overview: eProcurement Consolidation

Project Overview: Shared Services Operation

Other Initiatives

Grants: Proposal and Compliance

Discussion

Introductions

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David Barber•Key contributor to Ohio’s Lumina Productivity Work grant proposal as consultant to Ohio Board of Regents•Technology Strategist and Manager

David Schoettmer•President of Navigator Management Partners (navmp.com)•Consulting firm with expertise in the higher education industry, process design & reengineering, and large scale IT system implementation including PeopleSoft, SciQuest, and Kuali.•Navigator is advising on the approach, progress and support for efficiency initiatives related to Ohio’s Lumina grant.

Presenters

Context and Background

Higher Education in Ohio Ohio Board of Regents

• State agency coordinating higher education University System of Ohio (the public institutions)

• 14 Universities• 23 Community Colleges• Enrollment - 485K

70+ private, non-profit institutions

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Context and Background

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Ohio’s GoalsThe University System of Ohio developed a strategic plan to improve Ohio’s educational attainment by defining and achieving specific goals: 1.Graduating more students

2.Keeping graduates in Ohio

3.Attracting more talent to Ohio

Goals of the Lumina Foundation for EducationThe Lumina Foundation for Education offered grant funding to select states that addressed the three major goals of the Foundation, which were to:

1. Recast state finance systems to reward institutions for graduating students, not just enrolling them;

2. Increase the efficiency and cost-effectiveness of academic programs and administrative operations; and

3. Align resources in ways that allow institutions to serve more students.

Ohio sought to petition the Lumina Foundation for support in its common goals.

Context and Background

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Outside of the Lumina foundation grant

Ohio has made significant progress regarding Lumina’s first goal. This has been accomplished with a three part strategy that addresses university main campuses, regional campuses, and community colleges. Briefly;

• The university main campus formula rewards institutions for the course completion and degree completion of their students, as well as the quality and success of their doctoral programs;

• The regional campus formula rewards campuses for course completions, and• The community college formula remains largely enrollment based, though with

the inclusion of a reward for the achievement of student “Success Points” (also known as “Momentum Points”).

Ohio has made significant progress regarding the third goal of aligning resources in ways that allow institutions to serve more students. This includes Ohio initiatives such as the expansion of 2+2 programs, the positioning of regional campuses as baccalaureate-degree completion centers, and the completion of full Articulation and Transfer policies and procedures

Context and Background

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With these initiatives ongoing, Ohio requested Lumina funding to support increases in the efficiency and cost-effectiveness of academic programs and administrative operations.

Ohio’s Goals

•Create a continuous improvement system to identify spending efficiencies and productivity improvement strategies and implement them statewide

•Participate in purchasing aggregation programs developed by the state. Purchasing cooperatives covering products / services not aggregated by the state will also be supported

Specifically, $950,000 was requested over four years to support three initiatives:• The consolidation and systematization of all campus procurement at Ohio

University• The piloting of a shared service administrative operation in Northeastern Ohio • Funding for the communications plan to support social media training for Regents

and campus staff, provide additional Regents’ support for campus communications and outreach, and assess the efficacy of these strategies.

Project: eProcurement Consolidation

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What: • Consolidation and systematization of campus procurement, first at Ohio

University, and then progressively throughout the state system.

Tools to be leveraged: • Premier Purchasing Agreements, SciQuest as a common eProcurement

solution.

How and Why:• Single platform to consolidate contracts, procurement data, vendors, items, and

to promote rapid deployment of improvements in the supply chain.• Enhanced reporting, oversight, and performance metrics on a statewide basis.• Enhanced negotiating power (e.g. strategic sourcing) to extend savings beyond

Ohio’s largest universities into its regional and community college networks.• Achieve savings of 7% - 15% on the state system’s $2B+ in spend.

Project: eProcurement Consolidation

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• Approach and Timeline:

• Phase I – 2010 – Construction Phase o Install software at Ohio University o Build technical infrastructure and processes to integrate the chosen

toolo Pilot the solution

• Phase II – 2010-2011 – Implementation Phaseo Expand procurement to other universities o Rollout strategic sourcing/procurement

• Expansion – 2012 - 2013o Expand to community colleges and other entities.

Project: eProcurement Consolidation

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• Status and Results to-date:• In the first quarter 2010, the team

o Conducted Discovery for Requisition to Purchase Ordero Created the design of sourcing toolo Performed the business process reengineering efforto Began execution of Communication plan

• Currently, the team is in the pilot stage; to end in the fall 2010 o Develop, test and train on the sourcing toolo Pilot the sourcing toolo Perform Discovery for Approval processo Conduct a smaller markets Discovery efforto Design Approval process and Smaller Markets tools

• In the following stages the team will o Validate pilot results and expand pilot participantso Implement shopping experience (on‐line catalogue)o Perform Supplier enablement

• Once complete the solution will be available to other colleges and universities and staff redeployment will occur

Project: Shared Services Operation

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What: • Provide a common technology platform to provide foundational back-office

functions that may be adopted by multiple institutions and supported via a shared services model. Initial participants include the University of Akron (26k students) and Lorain County Community College (11k students).

Tools to be leveraged: • Applications and processes to support payroll, institutional research, and

asset management as part of a proof of concept.

How and Why:• The use of shared services models is an accepted practice in private industry

and has been shown to work in federal government settings. Similar cost savings should be available to the higher education industry.

• Supporting administrative functions with fewer overall resources will free up others to address the needs of the academic mission.

• Following a successful pilot, this concept could be expanded to address core enterprise software solutions and significantly higher cost items.

Project: Shared Services Operation

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• Approach and Timeline:

• Develop before and after cost and effectiveness metrics and methods

• Phase I – Install Akron’s PeopleSoft software at Lorain – HR, Finance and the Student Module are installed and running.

• Phase II – 2010-2011: Combine select business functions at UA & LCCC to prove combined administrative units can adequately serve multiple institutionso Amalgamate the two IT staffso Combine other select administrative functions to reside within Akron or Loraino For example, place HR at Akron and PR at Lorain, serving both schools

• Phase III – 2012-2013: Assuming phase II is successful, move in-house administrative shared services to a neutral, stand-alone Services Center and begin offering “outsourcing” services to other colleges and universities

Project: Shared Services Operation

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• Status and Results to-date:

• In 2001 President Proenza commissioned Price Waterhouse Coopers to study feasibility of sharing services

• Governor Taft commissioned a group to study how to secure the maximum return for higher education in Ohio

• Multiple Shared Services proof-of-concept starts and stops between 2002 - 2005• In 2006, the University of Akron adopted tactic to create a stand-alone, neutral,

Services Center that would be governed equally by colleges and universities receiving services from it. o Akron then sought a partner to help create the Shared Services proof-of-concept

• Lorain County Community College agreed to engage in the proof-of-concepto Using their ERP installation budget; other funding required for the Shared

Services proof-of-concept has come from grants • Initiative intends to prove that technology and administrative functions can be

combined and shared to significantly improve service quality and reduce cost• Once proven, services provided by the Center will be offered to other colleges

and universities

Other Initiatives

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Other Ohio administrative efficiency projects underway in various stages of contemplation, design or implementation, include:

1.Possible piloting of an open systems ERP (e.g., Kuali)2.Development and conduct of a strategic communications initiative3.Creation of a state higher education efficiency council4.Legislative creation of a uniform 3% / year efficiency target for public campuses5.Improvements in textbook affordability6.The start of ambitious campus energy conservation initiatives7.Dissemination of course redesign concepts8.The transition of all campus academic calendars to a uniform, semester system9.Creation of an academic program sharing initiative10.Consolidation of staff at selected state higher education agencies11.Adoption of a single source purchasing card for public campuses

Ohio’s short-term goal for FY 2011 is to generate real savings of at least $170 million to off-set planned reductions in state support. Ohio’s long-term goal is continuous improvement and continuous creation of efficiencies and savings.

Grants: Proposal and Compliance

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Key Points to consider when proposing for and complying with a state-wide grant:

• The process is common and known by those who operate in the grant worldo Lumina requested Letters of Intent, we responded, made the short cut,

then revised our ask in iterations

• Critical to our success o The content of our Strategic Plan o Our data system and ability to track costs

• We report about every six months, and must do so to receive the next iteration of our grant funds.

Discussion and Questions

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For More Information…

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David Barber614-893-3609

david@ohiolink.edu

David Schoettmer614-796-0090

dschoettmer@navmp.comor

Visit Navigator’s booth in the vendor display area