President Floyd talked to University of Missouri System staff at Jesse Wrench Auditorium at 3:00 p.m. on January 4th, 2006. There were approximately 200 people in attendance, including several representatives of local media organizations.
During this meeting, President Floyd presented his vision for reducing administrative expenses by 10%. He started the meeting with a slide showing where the University receives its funding, and one showing how the University is becoming increasingly reliant on student fees to operate. The 10% administrative cost savings would be re-directed into the academic programs and strategic priorities of the University, as reflected in the UM Strategic Plan.
10% Reduction Targets for the campuses
and UM System: The reductions are necessary to control
tuition prices, as funds from state appropriations have shrunk in the past
years.
The preliminary reduction plans are to be submitted
by early April. Then the plans will be looked over by the President's Leadership
Team. Gaps that need to be filled, or targets that were not met, will be subject
to further work. The final plan will then be submitted to the Board of Curators
for its consideration by early summer. The reductions should include all aspects of administration,
but does not include anything labeled as an Academic Priority or Teaching.
The effort is to capture these savings to re-invest into the academic programs
and strategic priorities of the University as reflected in the UM Strategic
Plan. Since the staff meeting, you may have heard through news media reports that
Governor Matt Blunt is proposing to increase state higher education funding
by 2 percent during the state budget year that starts July 1. President Floyd
has stated publicly that while he applauds the Governor's decision as a significant
help to the University, he is committed to the plan to cut administrative costs. For the UM System, President Floyd has asked everyone
to prepare ideas, and submit them to their supervisor, the Vice Presidents,
or to his office. These ideas may be mailed. Also, President Floyd has directed establishment
of a web page on Efficiencies (the address is below). This page includes an
online feedback form that will be in operation from Wednesday, January 11, 2006 through
the close of business on Friday, February 17, to encourage staff submission
of ideas and suggestions online within the stated time frame. President Floyd stated that nothing is off the table, and that every idea
or suggestion would be welcomed. He also stressed that this means we should
re-think how we are doing our jobs and what we do. Questions and Answers following
Dr. Floyd's presentation (wording has been paraphrased)
Q. Is a Voluntary Early Retirement
Incentive Plan (VERIP) under consideration as a way to reduce administrative
costs? Q: As a person who was a part of
the decentralization process earlier, would this mean that we would want to
pool some duties from campus to system? Q: Have we looked into ways of creating
new revenues? Q: With the absence of a Vice President
for Information Technology, who will be the voice for IT in shaping administrative
cost reductions? Q. Please define administrative costs. Q: If the 10% target is not met, would we have layoffs? Q: If a department transfers expenses
from their General Operation Accounts to a non-General Operations Account,
would that still be subject to the 10% cut? Q: Who comprises President Floyd’s
leadership team that will consider the departmental proposals for administrative
cost reductions? Q: During the 1970s, the number of
UM Vice Presidents was reduced to two. But since that period, more Vice Presidents
have been added. Would reduction of the number of Vice President positions
be on the table? Q: What are the UM strategic priorities
that this reduction would help? Q: Do state projections on revenues
have an influence on these plans to reduce administrative costs? Q: An employee noted that President
Floyd recently donated his pay raise to development campaigns on the four
campuses. The employee stated that he would give up his own next pay raise
if the Vice Presidents and executive-level staff would also give up their
raises. Q. Would there be a hiring freeze,
either directly or implied? Information sites regarding reducing Administrative
Expenses by 10%
$1,430,938
$6,172,469
$2,331,843
$1,082,229
$1,462,846
$12,480,325
21%
23%
36%
12%
8%
A: No. A VERIP will not be offered to facilitate this reduction
in administrative expenses.
A: I would see it as an opportunity to look at it both ways.
Maybe there are services the campuses are providing that could be done more
efficiently by the UM System, and vice versa.
A: Yes, we are always looking to create new revenues. We
are trying to develop external partners, and we continue to try to raise funds
from private sources. We are always open to any new ideas.
A: President Floyd is working directly with assistants and
associates of each department on behalf of IT. The leadership is meeting on
a regular basis to streamline problems and work out solutions. President Floyd
will look out for IT's interests during this plan of administrative reallocations.
A: Anything that does not directly tie to Teaching or Instruction.
For System that means everything is on the table. President Floyd said he
does not want his Vice Presidents to necessarily spread the 10% reduction
evenly throughout each department. Some departments have already sustained
reductions, others could reduce costs by more than 10%. The UM System as a
whole needs to meet the 10% goal.
A: President Floyd said he does not want to look at this
plan in that way; he cannot offer a definite answer about possible layoffs
until he reviews the various proposals department by department.
A: Each situation would be subject to review. If the cost
reduction merely shuffled the expense to another department, it could be unfair
to that department as it also looks to reduce its administrative costs by
10%.
A: The General Officers, who include President Floyd; Chancellors
from each campus; Jim Ross, the Chief Executive of University Hospital and
Clinics; Bunkie Wright, the General Counsel for the University; and the Vice
Presidents – Steve Lehmkuhle, Nikki Krawitz, Ken Hutchinson, Steve Knorr
and John Gardner.
A: In his three years leading the University, President Floyd
has created two Vice President positions and eliminated one. He cannot speak
to promotions or appointments that happened prior to his assuming office in
January 2003, as he was not’t involved in those moves. However, all
positions would be looked into, nothing is off the table. In answering this
question, President Floyd explained the reasoning behind the new VPs he has
appointed. As an example, he explained that the VP for Governmental Relations
was established to consolidate and coordinate efforts at both the State and
Federal levels.
A: Refer to the Efficiencies website: http://www.umsystem.edu/efficiencies
or reference
Strategic Planning and Performance Leadership at the University of Missouri
to examine UM strategic guidelines.
A: We have continually fought to make sure we receive our
fair share, but we need to show Missouri’s citizens and state policymakers
on a continuing basis that we are responsible and efficient stewards of their
money.
A. President Floyd did not reply to this statement. He later
said in response to news media questions that he does not have authority to
force employees to give up part of their pay.
A: For the past year, President Floyd has challenged his
Vice Presidents to reduce staff and new hiring. Some departments took it to
heart, while others did not. He will still ask them to try very hard. President
Floyd made it very clear that he has an obligation to all University staff
and their families, to protect those already working for the University before
adding personnel.
UM Staff Advisory Council Members 2005-2006
Feel free to contact SAC Council members with questions
relating to reducing Administrative Expenses by 10%.
SAC
website
Staff Advisory Council meetings are
open to all UM System Staff.
Meeting times are 9:00 a.m. -10:30 a.m. the second Thursday of the month.
Staff Advisory Council has resolved to work harder to represent you. In
the near future SAC will be sending out a survey/questionnaire asking
what issues you feel we need to address. Please fill out and submit form.
~~~Mary Ann Ihler SAC
Newsletter Editor