Shared Services: Driving Operational Efficiencies and Service Excellence

Brian HutzleyVice Chancellor for Financial Services & CFO (Interim)

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SUNY will reinvest resources from administrative savings to instruction and student services.

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• System-wide Initiatives

• Strategic Sourcing

• IT Transformation

• Administrative Alliances

• Campus Alliance Networks

• Research Foundation Functions

• Auxiliary Services

Strategies

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Shared Services

System-wide Initiatives Campus

Alliance Network

Accountability & Reporting

Policies

System Administration and University-Wide Programs

Budget, Planning and InvestmentCollege Council,

Alumni, Foundations

Research Foundations &

ASC’s

Strategic Enrollment &

Capital Master Plan

IT Transformation

Strategic Sourcing

Administrative Alliances

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System-Wide Initiatives

Transaction processing - payroll, payables, billing, and collection.

Functional expertise - procurement, MWBE, financial aid, internal control, information security, real estate, environmental and employee benefits.

Research Network - SUNY academic medical centers - phased investment in people, core facilities, and IT.

Library and Information Services - procurement, management systems, application upgrades, reporting systems

Energy Conservation, which began during the Middle-Eastern oil crisis in the early 1970s, had by 2006-07 reduced energy use by nearly 40 percent and saved over $1.2 billion in cost avoidance measures. Online learning efforts - course management, improving access & affordability, course selection, and tech support. Academics initiatives – advising tools, tutoring program.

Policy & Procedures – templates, training, internal control reviews; compliance

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Shared Services

System-wide Initiatives Campus

Alliance Network

Accountability & Reporting

Policies

System Administration and University-Wide Programs

Budget, Planning and InvestmentCollege Council,

Alumni, Foundations

Research Foundations &

ASC’s

Strategic Enrollment &

Capital Master Plan

IT Transformation

Strategic Sourcing

Administrative Alliances

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Strategic Sourcing

DOB/OGS Partnership• State-wide• Accenture Consulting• Multi-year

Project Goals• Savings• Knowledge Transfer• Process Improvement

– Modernize procurement practices

– Reduce administrative burden

– Speed up procurement process

Phase 1 : $165M Spend $10-27M (9-20%) Savings

• IT Hardware• IT Software

• Office Supplies• Fleet Cards

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Shared Services

System-wide Initiatives Campus

Alliance Network

Accountability & Reporting

Policies

System Administration and University-Wide Programs

Budget, Planning and InvestmentCollege Council,

Alumni, Foundations

Research Foundations &

ASC’s

Strategic Enrollment &

Capital Master Plan

IT Transformation

Strategic Sourcing

Administrative Alliances

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Administrative Alliances

Shared Function, Multiple Campuses, Single Administration • Budget, Accounting, and Student Accounts• Human Resources• External Affairs -Development, Alumni, Communications, FOIL, Government Relations• Marketing Energy Management• Information Technology• Enrollment Management• Auxiliary services –Food , Bookstore, Laundry, Print Shop• Libraries• University Police• Research and Sponsored Programs• Veterans Affairs• Institutional Research• Financial Aid• Educational Opportunity Program

2012-13 Executive Budget OverviewBrian Hutzley- Vice Chancellor & Chief Financial Officer

January 31, 2012

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Operating Budget Summary• 2012-13 General Fund Support essentially flat from

2011-12– Slight increase in general fund support for State-

Operated campuses– Community College per FTE funding level of $2,122

maintained– State support for three University Hospitals

maintained at 2011-12 level– Statutory colleges at Cornell and Alfred University

funded at 2011-12 levels– Adequate appropriation level to recognize $300

resident undergraduate tuition increase also recommended**UG tuition increase is in accordance with second year of five year rational tuition plan

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State-Operated Colleges• Addition of $3.8M from 2011-12 levels for certain

collective bargaining costs at State-operated colleges • No additional funding for general inflation (Requested

$4M)• University-Wide program funding realignment

recognized• Mid-year funding increase of $2.95M for ATTAIN & EOP

continued• Funding for last installment of tuition share ($16.5M to

bring to 50%) not included• Requested funding for SUNY Works strategic initiatives

of $40M not included

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Community Colleges• Base Operating aid of $2,122 per FTE student from

2011-12 maintained*

• Slight decrease in appropriation reflects changes in enrollment

• Rental Aid increased by $406K (3.6%)• $653K (39%) reduction in funding for Community

College Child Care Centers (reflects removal of legislatively-added funding)

• Funding to increase state-support over five years to 33% ($21.5M or $205/FTE) not included

*State Aid for 2011-12 budgeted at 24.8% of net operating costs

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University Hospitals• Maintains State support at 2011-12

level ($60M)– 2011-12 funding level had represented a

reduction of $68.7M from 2010-11 level– Additional requested support for fringe

benefit differential of $55.6M not included

– Total Fringe Differential is $170M +

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Summary of 2012-13 Executive Budget2012-13 State Tax Support(Millions of dollars)

2011-12 Adjusted

Base

2012-13 Budget

Request

2012-13 Executive

Budget

Change from

2011-12

% Change from

2011-12

Change from

Budget Request

% Change from

Budget Request

Summary                        

State Operated Campuses 832.3 896.5 839.2 6.9 0.8% (57.3) -6.4%Statutory Campuses 129.3 138.8 129.3 - 0.0% (9.5) -6.8%

Total State Operated $961.6 $1,035.3 $968.5 $6.9 0.7% ($66.8) -6.5%Cornell Cooperative Extension 3.9 4.7 3.9 - 0.0% (0.8) -17.0%Hospital Support 60.0 115.6 60.0 - 0.0% (55.6) -48.1%Community Colleges 441.4 465.0 434.2 (7.2) -1.6% (30.8) -6.6%General State Charges 213.0 213.0 213.0 - 0.0% - 0.0%Total $1,679.9 $1,833.6 $1,679.6 ($0.3) 0.0% ($154.0) -8.4%

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2012-13 Capital Budget- New Appropriations• Educational Facilities

– $550M in Critical Maintenance funding– Represents 5th of 5 annually expected amounts totaling $2.75B

• NY SUNY 2020– $215M approved funding campus financed debt at SUNY Buffalo– $184M in gift related spending authority for SUNY Buffalo & SUNY

Stony Brook• State-Operated Residence Halls

– $45M in pay as you go funding– No additional debt-financed funding provided due to concerns with

State’s ability to issue debt• Community Colleges

– $86.97M in funding provided– Represents 50% State share for Community College projects with local

sponsor support• Hospitals

– No additional debt-financed funding provided due to concerns with State’s ability to issue debt

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$100M of Savings

5%

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Shifting Administrative Cost Savings to Instruction

Through its shared services initiative, SUNY will reduce administrative costs and move those

resources toward direct instruction and student services. Over the next 3 years, all SUNY

campuses will shift—at minimum—5% of their administrative spending to direct instruction and

student services, resulting in $100M being reinvested.

Faculty ! Advising ! Tutoring! Labs!

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Savings will come from four

main areas

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• Savings will come from four main areas:– Strategic Sourcing - Working with the State of New York

(DOB/OGS) and Accenture Consulting Group we will use our combined buying power to drive savings.

– IT Transformation – A complete transformation of how we manage and use IT will not only drive savings but increase our overall service levels provided to our students and the campuses.

– Transaction Processing- Transaction based processing will provide improved service at a reduced costs for payroll, benefits, accounts payable, travel, and other basic administrative functions.

– Campus Alliance Network - Launched in August 2011, the Campus Alliance Network’s partners campuses to achieve savings, efficiencies and improved services. Working together the campuses establish their own plans, but as a System we share in our successes and best practices.

SUNY MWBE Program Action Plan

SUNYPPAAJanuary 31, 2012

• The Chancellor has recommended and the Board of Trustees have adopted a Resolution on reporting on SUNY MWBE utilization and training to ensure compliance with Executive Law Article 15-A.

• A letter is being sent from the Chancellor to campus Presidents outlining SUNY’s commitment to the University’s MWBE program and campuses’ mandatory compliance.

• I will send a memorandum to campus Business Officers detailing the new MWBE legislation and compliance requirements.

• The MWBE component has been re-introduced to Presidential evaluations.

SUNY’s COMMITMENT

PROCEDURES & TRAINING

• The University’s MWBE procedure (#7557: Participation by Minority Group Members and Women (MWBEs) with Respect to State University of New York Contracts) has been updated to reflect the new legislation, reporting instructions to capture campuses’ utilization of MWBE subcontractors and best practices in making a Good Faith Effort.

• System Administration will continue to develop enhanced MWBE training modules:

1. one which will be mandatory for facilities staffs (with job responsibilities that include construction-related procurement) and procurement staff; and

2. one which will focus on University Centers and their commitment in their SUNY 2020 proposals to improve SUNY performance in MWBE utilization.

ASSESSMENT & REPORTING

•Annual report to the Board of Trustees & Chancellor on expenditures made with MWBEs and WBEs and discuss strategies to increase the University’s contracting with these business entities.

• System Administration will 1. make modifications to the central accounting system and work with the

Department of Economic Development to allow automated reporting by campuses of the payments to MWBE sub-contractors.

2. develop and issue, on a quarterly basis, a University-wide report card on campus MWBE utilization to Presidents. The report will include all campuses’ utilization and highlight best practices to assist under-performing campuses.

•The SUNY Purchasing Association committee on MWBE Utilization will continue to identify best practices and search for new strategies to improve MWBE participation in SUNY contracts.

RESOURCES & RECOMMENDATIONS

• The University will:

1. continue to discuss best practices and opportunities to increase MWBE utilization with the Construction Fund;

2. work with the DED to enhance the University’s MWBE program;

3. partner with NYS Small Business Development Centers, Entrepreneurial Assistance Centers and Minority Business Development Centers to announce procurement opportunities to MWBEs and solicit their participation in SUNY contracts;

4. have campuses designate a person to serve as a MWBE officer or partner with other campuses to hire a shared or regional MWBE officer; and

5. where appropriate, include an MWBE component in staff evaluations.

Current Goals

State-wide Goals SUNY Goals

Category MBE WBE M/WBE MBE WBE M/WBE

Construction 14.33% 8.41% 22.74% 7% 4% 11%

Construction-related services 13.21% 11.32% 24.53% 7% 7% 14%

Non construction-related services 19.60% 17.44% 37.04% 10% 8% 18%

Commodities 16.12% 10.93% 27.05% 8% 6% 14%

Total 16.53%12.39

%28.92% 10% 10% 20%