These minutes reflect
discussion and debate at a meeting of a committee of the
Minutes
Senate Committee on Finance and Planning
Tuesday, November 29, 2005
2:30 – 4:15
238A Morrill Hall
Present:
Fred Morrison (chair), Charles Campbell, Arthur
Erdman, Steve Fitzgerald, Lincoln Kallsen, Joseph Konstan, Michael Korth, Ian
McMillan, Kathleen O'Brien, Kathryn Olson, Richard Pfutzenreuter, Justin
Revenaugh, Karen Seashore, Michael Sertich, Alfred Sullivan, Kate VandenBosch
Absent:
Calvin Alexander, Christina Bachmeier, Rose Blixt, Daniel
Feeney, Dan Hennen, Thomas Klein, Judith Martin, Jacob Olson, Charles Speaks,
Thomas Stinson, Susan Van Voorhis, Michael Volna, Warren Warwick
Guests:
none
[In these minutes: (1) administrative strategic positioning task
forces; (2) six-year capital plan and 2006 capital request; (3) faculty salary
goal]
1. Administrative Strategic Positioning
Task Forces
Professor
Morrison convened the meeting at 2:30 and turned to Vice President O'Brien to
provide an update on the work of the administrative strategic positioning task
forces. He noted that there will be a
report to the Regents next week on this same topic; this meeting is a chance
for the Committee to get its oar in if it wishes to do so.
Vice
President O'Brien distributed copies of a set of slides and began by discussing
the relationship between vision, strategies, plans, and budgets. She recalled President Bruininks's
declaration, in his inaugural address, that "the
The
guiding principles—the strategies—define the playing field. These include (and are largely direct quotes)
working toward optimal alignment of administrative services with the academic
mission, openness to reviewing all and any administrative process, structure,
and policy (that is, everything is on the table), recommending administrative
initiatives that can be implemented within the targeted timeframe,
identification of structures and processes that can remove barriers, eliminate
duplication, and reduce regulation, assumption that any such recommendations
will be University-wide (with minimal opt-out provisions and only for specific
reasons agreed on in advance), emphasis on the need for decision-making that is
driven by reliable information rather than past practice or anecdote, and
understanding the impact of change on individuals and units and planning
appropriately.
The
objective, Ms. O'Brien said, is to provide administrative services at the best
value to support the education, research, and service missions of a top-ranked
public research university. The
administrative culture and services will be integrated and cross-functional. The action areas include recognizing the
University (campuses, colleges, departments) as a single enterprise; embracing
and achieving a culture that is committee to excellence, service, and
continuous improvement; transforming the "centralized versus
decentralized" administrative structure; adopt best-practices management
tools; focus administrative support on serving students, faculty, and academic
units; maximize opportunities for people of the University to grow, develop,
and contribute; and optimize the use of the University's physical, financial,
and technological resources.
Vice
President O'Brien then identified foundational work and current projects for
four of the action areas. In the area of
a single enterprise, for example, foundational work includes development of
"single enterprise" systems and current projects include Resource 25,
the new classroom scheduling system, and a single IT network. On the example of Resource 25, Professor
Konstan asked if there is place where resolution of conflicts will take
place. For instance, perhaps the
University could serve students better (by having classes when they want them,
concentrated early in the day) and faculty research (by concentrating classes,
allowing larger blocks of time) by being inefficient
in the use of classrooms. He would not
argue that is the case, but is there a place where these potential conflicts
can be resolved? Ms. O'Brien said there
are a number of places, including the administrative task force steering
committee. She noted that space is
debated holistically during the capital planning process (what is the right
kind of space, how much is needed, and so on).
Professor Konstan's question is important: is the process is asking all of the questions
and the right questions? Professor
Konstan commented that there needs to be someone watching to see when
optimizing (in one area) might not be optimal (overall).
The
vision of administrative strategic positioning is to break down barriers
between and across units so that resources can be leveraged to achieve
transformational change and achieve the President's objective. The task forces are at work, identifying
projects and keeping focused on action areas, and there is substantive work in
each area that one can point to as implementation. Ms. O'Brien reviewed the implementation
structure, the responsibilities of the steering committee (and its membership),
its objective, and the general responsibilities of the task forces (achieve
system-wide success, refine and periodically verify the scope and direction,
and provide direction and resources to project implementation efforts). She said that she expects to receive reports
from the task forces in January and they will be on line in February for
review. That will be when the Committee
reviews them as well.
Professor
Erdman asked two questions. One, how
will the reward system for faculty and staff change to ensure the success of
these efforts? Two, how will the process
sustain itself over the years? Vice
President O'Brien noted that one of the administrative task forces is
"People," and that group has talked with Human Resources Vice
President Carol Carrier about compensation and performance. There is a recognition that if the University
is to develop people, compensation and reward need to be looked at. Professor Morrison said that this would also
involve the creation or changing of job families so there would be progression
opportunities; job satisfaction as well as cash compensation will be part of
the equation.
As
for the second question, Vice President O'Brien said the President has asked
that the task forces remain in place for two years to assess the changes for
their efficacy. The reports from these
task forces will look different from the academic task forces. The task forces will meet to assess projects,
whether they require redirection, and whether they are on track.
Professor
Seashore asked what is meant by "transforming the 'centralized versus
decentralized' administrative structure."
The objective is a defined, distributed administrative structure, not
centralized or decentralized, but rather aligned and integrated, Ms. O'Brien
said. The goal is to restructure
activities so they are at the level they belong (central, college, department)
and that they have appropriate resources.
They are assessing each management system and functional area to determine
what needs to be centralized, what decentralized, and where there are core
competencies and appropriate resources.
Professor Seashore said that a one-size-fits-all model could be
difficult because colleges vary in size so much; CLA may be able to do things
on its own that the Humphrey Institute could not. Professor Morrison noted that another task
force is looking at small colleges to see if there are economies of scale that
could be achieved. Ms. O'Brien said that
there are discussions with the small college task force and she agreed that one
size would not fit all; they will need to fine-tune the system to meet the
needs of the colleges. Professor
Seashore observed that it would not be desirable to rationalize the University
by making all colleges the same size. Ms.
O'Brien agreed but said that a defined and distributed system does work in
large, complex organizations and it can work at the University; such a system
is necessary to eliminate duplication and ensure quality. There are also regional and sub-regional
approaches, Mr. Kallsen said; Professor Morrison concurred, noting that some activities
could be collegiate and some regional in order to ensure all units are covered
(e.g., West Bank, St. Paul, AHC, etc.).
Ms. O'Brien said they expect a mixed model. Are they looking at other universities doing
the same kind of vigorous planning, Professor Seashore asked? They are, Ms. O'Brien said, in particular UC
San Diego and the
Professor
Konstan asked if Vice President O'Brien had any sense of how information would
be disseminated to unit levels.
Departments are managed by people who have been promoted for things
other than their management skills and they do not receive a lot of
training. If information is to filter
down, they need to be sure department heads receive advice based on the profile
and budget of the department. Ms.
O'Brien said that is exactly right and which is where the challenge of
implementation will come in. A broader
group from across the University must be engaged to achieve implementation. One project might be a "chair
camp," Professor Morrison said, which would be a more fulsome training
program for people appointed to management positions.
A
number of service unit heads can do things without cross-unit work, Professor
Konstan said. For example, Parking successfully spent effort years ago to
consolidate parking spots centrally when they had been considered, in some
cases, the property of colleges or units. On the other had, Parking still
has a line in its publications stating that the only reason justifying special
reciprocity in parking is for teaching-which is strange for a university that
has as its goal being one of the top three public research universities.
In fact, Parking does not enforce that rule and recognizes that research is
important, but the rhetoric sends the wrong message.
Professor
Morrison thanked Vice President O'Brien for her report.
2. Six-Year Capital Plan & 2006
Capital Request
The
six-year capital plan went to the Regents in November for information and will
be acted on by the Board in December, Professor Morrison reported. In the meantime, Vice President O'Brien met
with the Subcommittee on Capital Projects and Campus Master Planning, chaired
by Professor Erdman.
Vice
President O'Brien distributed another handout and, with Vice President
Pfutzenreuter and Executive Associate Vice President Sullivan, led the
discussion of the six-year capital plan.
The principles guiding the plan are:
"ensure long-term academic excellence by aligning capital projects
with the University's strategic positioning goal and action step, promoting
asset stewardship by investing in existing facilities and infrastructure,
addressing academic and service unit priorities, leveraging space utilization
opportunities, [and] upholding the institution's financial position and debt
capacity." In other words, if the
University is to be among the top three public research universities, Ms.
O'Brien said, what does that mean for facilities? In terms of "promoting asset
stewardship," the University has existed for over 150 years and will be here
a lot longer; how can it get the best use of its buildings and its information
technology and research infrastructure?
In terms of "leveraging space utilization," the University
cannot afford to add 28 million gross square feet of space every 50 years, it
would probably not build that much space if it were starting anew, and it needs
to make the best possible use of the space it has. "Upholding the institution's financial
position" means that it has to have the money to pay for facilities.
Vice
President O'Brien reviewed the schedule and components of the six-year capital
plan. The 2006 capital budget plus the
plans for the next five years make up the plan.
The 2006-2011 plan will continue to include an all-funds debt projection
and financial planning parameters, will include a separate section for projects
that have permission to seek federal funding (this is the first time this
element has been included, but it will require a disciplined decision about
what is most important and cannot be a license for many projects to seek
federal funding), and adds flexibility to the 2010 capital request by limiting
specific projects (because strategic positioning could lead to identification
of projects that are not known today).
Dr.
Sullivan, alluding to the principles that Vice President O'Brien had
enunciated, observed that many projects fit under more than one principle. Some examples of the principles in action,
however, are inclusion of Physics and a new Medical Biosciences Building in the
six-year capital request as part of aligning capital projects with strategic
positioning; addressing academic and service unit priorities is exemplified by
including the Science Teaching and Student Services building (replacing the
Science Classroom Building at the end of the Washington Avenue Bridge), the UMD
Labovitz Business School, and Research and Field Stations, Land Care Facility
(the University is a small city and has much it must take care of), and Land
Purchases; seeking to leverage space utilization is represented by the Carlson
School of Management expansion (which also provides space for CLA) and the
Strategic Positioning Reallocation Fund ($15 million to cover reallocation
costs that are expected although not yet identified). The
Mr.
Pfutzenreuter next reviewed the University's debt capacity. The University has approximately $596 million
in debt capacity for 2006-2011; the question is how to pay for it were it to be
used. The proposed six-year capital
plan, if fully funded, plus other projects (including a new football stadium),
would use $392 million of that capacity, leaving $204 million unused. He also reviewed the sources of funds for the
six-year plan (state funding, University funds—central reserves, etc.—debt, and
other sources such as grant funding and donations.
Professor
Seashore noted that one of the strategic positioning goals is an increased
capacity for human service training by consolidating two or three
colleges. That is a wonderful idea but
there is a physical plant problem: the
new college will be scattered across 16-17 buildings on several campuses and
the goal will not come to fruition without changes in space allocation. How will this academic priority be translated
into a capital priority? A big part of
the issue is timing, Mr. Pfutzenreuter said; the capital plan has to be done before
strategic positioning is completed, which is why the 2010 request has largely
been left a blank (there is a big "to be determined item" for that
year, amounting to $170 million).
Second, they have set aside the $15 million for relocation, recognizing
that some things would have to be done.
Third, the 2008 projects to be requested could change. Professor Seashore said she understood that
items move up and down on the capital plan; the simple question is when do
academic priorities come into play in the planning process. Dr. Sullivan said the compact process
includes a facilities section. The
administration reviews these requests and builds a "contenders"
list. He observed that there can only be
one "number one" priority at a time and deciding among facility needs
is an excruciating process. Professor
Seashore said that her college is only one example of a situation that will
arise a number of times, and the three deans currently in place will not make a
joint request for space for the new unit.
Any new dean will take a couple of years to become acclimated to the
job. Ms. O'Brien agreed the process does
rely on college leadership; Professor Seashore said that is why she brought up
the centralized/decentralized question:
there is a need for visionary deans.
Some units have them, some do not.
The
compact is a starting point, Dr. Sullivan said, but the central officers and
staff have an institutional memory and are aware of these kinds of issues. Professor Campbell said that he has been on
this Committee a long time and in his view it was VERY important that capital
project planning was added to the compact process. That makes capital planning more tied to
academic priorities. It also reinforces
the centrality of collegiate units, Professor Seashore said, and
regionalization will not address college needs.
Regionalization works on the administrative side. She said she believed the process is a good
one but the administration needs to look for holes.
Mr.
Pfutzenreuter said that a key issue in the six-year capital plan is science
facilities. There are few $20-million science
buildings any more (the Physics building is projected at $72 million, medical
biosciences facility at $60 million), so they have raised the issue of how to
pay for these expensive science buildings.
As the University goes to the legislature for capital funding, there
will be HEAPR and four projects—and soon, as these price go up, it could be
HEAPR and two projects. The University
cannot build these buildings without state support, but there needs to be a
different approach so the big science buildings are not competing with a lot of
other small projects across the state.
Professor
Konstan pointed out that the 2006 request consists of buildings for the
business schools at
Is
there any top-three university that is not strong in the core arts and
humanities, Professor Konstan asked? Is
there any way to say that the request is pushing toward the mission, even
though there are not funds for those programs?
The money is being sought so that space can be freed up for the arts and
humanities, Professor Morrison said.
That raises the question about who speaks for the entire University,
Vice President O'Brien said. Someone
must look at where investments have been made rather than just provide rhetorical
support. Across ten years of capital
requests, however, some areas have done well some times and others have done
well at different times.
But the strategic positioning process
is not taking into account space needs that result from college consolidations,
Professor Morrison observed, and it will have to do so explicitly at some
point. It will, Mr. Pfutzenreuter
said. Ms. O'Brien said there is not
specific information available yet for each consolidation plan. Professor Morrison said that any task force
plan will be incomplete if it omits how space should be configured. Professor Seashore disagreed; she said the
task forces cannot identify which groups of faculty from the three colleges
will get together. Professor Erdman also
noted that the task forces have been asked not to address space issues. Professor Seashore said this is a 4-5-year
project. Dr. Sullivan said that he, Mr.
Pfutzenreuter, and Ms. O'Brien have talented staff with a lot of walking-around
experience of campus buildings. They
will not make decisions but will think about opportunities; at this point,
however, there is not enough information to make any decisions. He said he wanted the Committee to be
assured, however, that there are people thinking about space questions.
Professor
Morrison thanked Ms. O'Brien, Mr. Pfutzenreuter, and Dr. Sullivan for their
report.
3. Faculty Salary Goal
Professor Morrison said the Committee needed to continue
to work on the question of the faculty salary goal vis-à-vis the strategic positioning
goal. He believed there were two
conclusions from the last meeting: the
preliminary resolution that will be brought to the Faculty Senate ("If the
University aspires to be among the top three public research universities in
the world, the aspiration must include salaries commensurate with that
aspiration"), and that the Committee needed more study and data. What does it wish to do, he inquired?
Professor Konstan said he would like to see salaries
normalized by discipline, length of service, etc., so the case can be
made. One question is how much of the
University's faculty is in highly-paid areas; if a lot, the data may understate
the problem. Professor Morrison said the
first set of data, normalized by discipline, does not exist; data by discipline
exist, but the farther down one goes, quality and accessibility decrease. And comparisons exist for some disciplines
but not others. Those to whom the
University wishes to compare itself may not release disciplinary data. The salary data the Committee has already
received—by rank in the Big Ten, top 30, and AAUP institutional data—are as
robust as it will get.
The Committee needs to provide a more complete statement
to the Provost by December or January if it is to be effective, Professor Morrison
said. He asked that Committee members
provide him with suggestions on what might be included in an additional
statement; a draft will be on the agenda of the next meeting or so.
Professor Korth inquired if the statement would include
Morris; he provided salary data for Morris comparison groups. Professor Morrison said it would; this is a
University-wide commitment to excellence, and for Morris perhaps the goal is to
be among the top three public liberal arts colleges. Professor Seashore, looking at the two lists
provided to the Committee, expressed a preference for the "Morris 14"
because it has institutions that are known locally. The only problem is that it is heavily
private, Professor Morrison said. It
has, however, been used for over a decade, Professor Korth pointed out, so is
generally recognized as the appropriate group for the Morris campus. Professor Konstan wondered if Morris had not
already achieved the goal of being among the top three in its category; what
incremental changes are needed?
Professor Korth said if one believes the U.S. News and World Report
rankings, Morris has been number three a few times and in the most recent
rankings it was number four.
Professor Morrison adjourned the meeting at 4:20.
--
Gary Engstrand