Staff positions impacted by efficiencies gained in five more proposed administrative business cases in the state Board of Regents' TIER study could be absorbed in most instances through "natural attrition" over several years, say the consultants doing the study. But board president Bruce Rastetter said it's premature to talk about position cuts because the board won't make decisions about implementing the additional business cases – a cost/savings/risks/benefits analysis of specific efficiency proposals – for at least five weeks.
In a special board meeting on Oct. 2, members from Deloitte Consulting summarized eight business cases (PDF) in the areas of information technology (4), facilities (2), human resources and financial transactions. The three universities now have time to discuss the proposals and provide input to the board and consultants. That process includes a town meeting on each campus; Iowa State's is Monday, Oct. 13 (8:30-10 a.m., Memorial Union Gallery), and all are invited. It will be video streamed and tweeted (@IowaStateUNews) for those unable to attend.
"We're looking for feedback from the universities prior to going ahead with any implementation phase," Rastetter said.
For proposals that might be implemented, he said the board also would rely on the university communities to indicate what they have the time, resources and expertise to tackle themselves. The Deloitte team offered three implementation models: university-led, consultant-coached or consultant-facilitated.
At a Nov. 14 telephonic meeting, the board is expected to decide on the future of each proposed business case.
TIER (Transparent Inclusive Efficiency Review) is a board-initiated review of the three regent universities to identify areas for dollar savings and/or more efficient processes. In February, the board hired Deloitte Consulting to lead the review.
Rastetter said the TIER goal is to strengthen public higher education for the long term.
"We know our present system is not sustainable. It's only sustainable if we're going to increase tuition, increase student debt and ask the state for more money," he said. "Any savings we have with this, we've told the universities they're going to reinvest to create better universities and better programs."
Proposals are estimates
Deloitte project manager Virginia Fraser emphasized that the business cases are estimates. "They're not precise, they're not 100 percent accurate. But it is the right level of analysis to inform a decision," she said. "We expect our estimates to change as we move into implementation. Some will go up, many will go down. That's a normal part of the process."
In their presentation to the board, Deloitte team members indicated that efficiencies gained could consolidate and eliminate Iowa State positions in five of the proposals. Typically, those losses could be absorbed through "natural attrition" (noted with *). At Iowa State, that's turnover between 7 and 9 percent annually. The consultants mentioned both attrition and phased retirement for two of the cases (noted with **).
Here's a summary of the eight business cases:
In the area of information technology
(two technology-related proposals would precede two operational proposals):
- As use cycles end, replace desktop computers with thin client option (networked computer without its own hard drive), and replace personal printers with networked printers that serve groups of employees. Estimated annual savings at Iowa State, including lower energy costs, is $1.6 million-$2 million.
- Reduce the number of software applications purchased or developed within and across the three universities* and create an inter-university council that finds a consensus regarding the overall inventory, particularly in areas common to all (for example, facilities management or library management). Estimated annual savings at Iowa State is $1.6 million.
- Technology changes from the above proposals, future innovations and leaner supervisor/employee ratios will "transform" central IT services.* Estimated annual savings at Iowa State is $500,000.
- Reduce duplication of services between central IT and distributed IT units.* Use a central team for common infrastructure-related services (for example, server or network management, help desk, end user support), with department teams focusing on local or specialized needs such as research. Estimated annual savings at Iowa State is $1.5 million.
In the area of internal financial transactions:
- Streamline and standardize how the universities provide some finance transactions (suggested are travel and expense reports, purchase requisitions, accounts payable and accounting services), offering them at either the college* or university** level. Estimated annual savings at Iowa State, once startup costs are recovered, is $1.7 million to $2.7 million. Both options would involve retraining and relocating employees. As estimated by the consultants, shared services at a university-wide level could result in greater savings, but also greater shifts in staffing.
In the area of human resources:
- Revise Iowa State's decentralized HR services model. Options include purchasing** ($10 million) or updating** ($2.3 million) the current HR information system, with the goal of decreasing manual processing and data entry, increasing access to information and improving security and reporting capabilities. Some HR liaison employees around campus would be retrained. Once implementation costs are recovered, estimated annual savings at Iowa State is $800,000 to $2.1 million.
In the area of facilities management:
- Invest in energy-saving initiatives (for example, digital control systems, occupancy sensors and new light fixtures) with short payback periods and financed through a new energy management fund of $1.85 million. The emphasis is on saving money rather than sustainability. Estimated annual savings at Iowa State is $270,000.
- Adjust thermostats in classroom buildings during evenings and the summer (this proposal applies only to Northern Iowa).
First implementation contract on hold
At its August meeting, the board agreed to implement changes related to university purchasing processes and to negotiate a separate contract with Deloitte to lead that implementation work. Rastetter said that contract is on hold pending the board's November vote on the eight remaining business cases.