2000-2001
Meeting #3, Tuesday, September 12, 2000
Present:
McKeever (chair), Smelser (vice-chair), Brunsfeld, Chun, Coonts, Finnie,
Foltz, Fritz, Goble, Guilfoyle, Haggart (w/o vote), Hong, Kraut,
McCaffrey, McClure, Nelson, Nielsen, Olson, Pitcher (w/o vote), Thompson,
Vaughn Absent: Goodwin, Meier, Trivedi Observers: 2
Call
to Order. A quorum being present, Faculty Council Chair, Professor
Kerry McKeever, called the meeting to order at 3:35 p.m. in the Idaho
Commons.
Minutes.
The council, by voice vote, accepted the minutes of the September 5, 2000,
meeting as distributed.
Chair’s
Report. Chair McKeever related to the council recent activities by
the group of higher education faculty council/senate presidents. They are
drafting letters to be sent to the governor concerning the state-wide
effect of having below peer-average salaries in the state’s institutions
of higher education. One of the letters will include endorsements from
Idaho business leaders.
Provost’s
Report. Provost Brian Pitcher made the following announcements:
The
10th day official registration report has been compiled.
It shows an overall enrollment increase of 2.91% or about 300 FTE
students. Each class at the university – freshman through the
graduate level – shows increases from Fall 1999. The quality of
the incoming freshman class appears to be quite strong. BSU is up
1.5%, ISU shows no gain, and LCSC is down by about 10%.
The
group that has been working on the action plan for scholarly
activities expects to release their draft recommendations by September
22nd. He encouraged the council to take a careful look at
the plans and become active in the discussions that will follow.
The presidents’ council is meeting today with the governor. A recent
news release indicated that the governor has publicly stated that
there will be a $200 million surplus, which will lead to tax relief
and more support for higher education facilities and research
infrastructures. The provost hopes that the surplus will also
translate into higher compensation for university employees.
The president has instructed the provost and Wayland Winstead to visit
"one-on-one" with members of the SBOE/Regents regarding fee
issues and having the board take a long-term view of budget and
funding issues facing the U of Idaho. These conversations include the
expression of the need to increase fees if state funding does not
increase but, if so, the university should increase the amount and
availability of financial aid available to students at the same time.
They are also encouraging the SBOE/Regents to take a broader viewpoint
concerning institutional flexibility in making decisions about how to
"grow" and use revenue. Another issue being brought to the
board in these conversations is that of encouraging the SBOE/Regents
to adopt, as a major policy initiative, the intent to increase the
percentage of high school graduates who go on to some form of
education beyond high school. Idaho is 5th lowest in the
country in terms of students who pursue some kind of
education/training beyond high school. In their conversations to-date
Pitcher, and Winstead have found board members to be very receptive to
these ideas and issues.
Announcements.
Faculty Secretary, Peter Haggart, announced to the council that Professor
J. Roger Cole (L&S Representative) has resigned from the Faculty
Council. He said that the college has been notified and a special election
will be held to fill that vacancy. In a related matter, Professor Cole’s
resignation also leaves a position and committee chair responsibility
vacant on the Campus Planning Committee. Haggart asked council members to
consider the possibility of serving on this committee and to be ready to
fill the vacancy on the Campus Planning Committee at the next Faculty
Council meeting.
Councilor
Melanie Coonts announced that student international study/travel grants
will be available in the spring. The application deadline for these grants
is October 15th. Announcements will be forthcoming in the Argonaut
and the University Register.
Budget
Liaison Committee Report. Councilor Marla Kraut, chair of the
Budget Liaison Committee reported to the council that the committee is
considering making a recommendation to increase the membership of the
committee. The present membership of the Budget Liaison Committee (3
members of the Faculty Council and the past chair of the committee) and
function (to act as a liaison between the administration and the council)
has been augmented over the years in an ad hoc fashion, as the
administration has become more inclusive in their budget planning process
and as the budget and planning mission has changed.
The
Office of Institutional Planning and Budget was established four years ago
and there soon became a need to share information with a larger advisory
"audience." Thus, the committee now has "unofficial"
representation from the Staff Affairs Committee and the ASUI, plus
ex-officio representation from the Office of Institutional Planning and
Budget and by the chair of Faculty Council. Professor Kraut noted that
with the implementation of Responsibility Center Management (RCM)
the committee believes that its membership should be expanded – either
in an ex-officio process or by re-writing the membership statement. The
function statement of the committee would also need to be amended. The
current thinking of the committee is to add two more faculty members
(either council or non-council members), one more staff member, to have a
total of three students (representing undergraduate, graduate, and law
school students) and one departmental administrator.
This
proposal generated a considerable amount of discussion. Questions raised
included: Would this be a permanent or temporary change in the committee
structure? Should other constituencies be represented on the committee
(such as facilities and information/technology services)? What is the
reason that more members are needed? Should a restructured committee have
a formative role in the implementation of the RCM?
Comments
included: This committee should really be a Budget and Financial
Planning Advisory Committee that has a more formative role in early
budget/planning discussions. Expanding the committee membership gives it
some continuity from year-to-year and allows the membership to accumulate
knowledge and expertise in the budgeting process over the term of
membership. Expanding the membership also gives the committee a broader
range of input. It sounds like a restructured committee might play a
formative role in shaping the details of the implementation of the RCM. If
so, that is a very important function and broad representation is an
excellent idea. It was suggested that the Committee on Committees be
charged with writing a function statement for the new committee that
presented a more philosophical function and membership description rather
than the existing prescriptive statement. The new statement should contain
wording that would permit flexibility in membership and function which
would then allow the committee to change as the university changes.
In
response to questions and comments concerning whether a restructured
committee (Budget and Financial Planning Advisory Committee) would
play a formative role in the implementation of the RCM, it was noted that
there are several sub-committees that would be dealing exclusively with
RCM implementation issues. However, a restructured committee could provide
formative participation in helping the administration work their way
through alternative planning and budget policy issues. The newly
structured committee could act as a "steering committee" for the
sub-committees working on the communications plan, training, policies and
procedures, and revenue attribution aspects of the RCM. In fact, a
restructured committee could play a number of important roles in the
budgeting and planning process of the U of Idaho.
The
council’s consensus was to ask the Budget Liaison Committee to send its
recommendations to the Chair of Faculty Council, who would then charge the
Committee on Committees to discuss a restructure of the committee and make
a recommendation to the Faculty Council.
Responsibility
Center Management (RCM). Executive Director of Institutional
Planning and Budget, Wayland Winstead, provided the council with an update
of the university-wide policy initiative to bring about a migration of
university budgeting to an RCM management model. Winstead explained that
the RCM is a strategic approach to structuring executive roles and
financial relationships between the president and provost and the next
lower level of administrative management. It is a system that involves a
more comprehensive implementation of a "divisionalized" form of
organizational structure that is consistent with the scale and complexity
of the operations of a research university, such as the U of Idaho.
RCM
will take the U of Idaho from a system in which the resource allocations
are handled and the operational problems are solved at the very highest
level of administration (the president and provost) and move it to a
system that makes the college deans, vice presidents, and vice provosts
the responsible managers. He said that the executive roles and
relationships are extremely important because it clearly defines areas of
responsibility. These "new" managers will then determine how
their responsibility centers function, within certain policy and
procedural constraints. Winstead noted that this "freedom" for
the managers was like the quote from Robert Frost, "Freedom is
running loose in the harness." RCM will adjust the harness so that
all of these managers are pulling the university in the same direction.
RCM’s must balance on the one hand the financial realities of being
revenue dependent on market-based sources versus the traditional issues of
academic quality. Winstead stated that a better job of achieving that
balance can be done at the college level rather than at the level of the
president or provost. The closer the decision-making process is to the
action and consequences of the decision-making, then the better the
decision-making process will be and more timely decisions will be made.
Winstead
outlined the purpose of RCM at the U of Idaho:
To
implement the U of Idaho Strategic Plan Infrastructure Goal #3, "Design
and implement effective budgeting systems which align incentives and
allocations with strategic priorities." Plus the action
strategy to "establish a flexible, stable, accountable,
incentive-based funding system." (University of Idaho
Strategic Plan, July 1998)
To
create appropriate incentives and to eliminate inappropriate
disincentives in the resource allocation process. Winstead said that
he has often heard the remark "At the U of Idaho, no good deed
goes unpunished."
To
foster effective adaptation to the U of Idaho’s increased dependence
on market sources of revenue, i.e. enrollment and fee related income,
grant and contract activity, outreach activity, and private giving,
rather than state appropriations, which are a shrinking and volatile
share of our income.
To
restructure executive relationships by empowering deans and vice
presidents, by delegating them both responsibility and opportunity.
To
enable better planning by making resource allocations more
predictable. Departmental growth should be matched by increasing
resources.
To
increase flexibility by increasing the number of options available in
the areas of budgeting and personnel management.
He
continued his presentation by outlining how the RCM model builds on our
present situation and promotes further changes:
RCM’s
will be built on a distributive management initiative and financial
plan that has already been put into place at the U of Idaho.
The
relationships between the president/provost and the deans/vice
presidents are being restructured under this plan. The
president/provost are to be responsible for the strategic leadership
of the institution – doing the things today that don’t have an
immediate pay-off, but which position the university to be more
successful in a five to ten year time frame. The responsibility for
the day-to-day operational problem solving and leadership falls upon
the deans and vice presidents. Solutions to operational issues will
remain at this lower operational level.
The
focus of action plans shifts from the departmental level to the
college level.
This
shift in responsibilities should lead to a more structured budget
process, which would include fiscal year plans, budgets, evaluations,
negotiated performance expectations, and accountability which will
preclude the old practice of going to the president or provost for
off-cycle budget allocations. No money will be reserved by the
president or provost – you must do the job within your college
allocations. However, all the revenue coming to the institution will
not be turned over to incentive based funding. There will be
opportunities to request allocations (on a year to year basis) that
are along more traditional lines, like support services and other
areas that have little opportunity for entrepreneurship. Deans may
choose to take the RCM concept down to the departmental level or keep
it only at the college level.
RCM’s
should foster entrepreneurship using predictable resource allocations
and by allowing flexibility and liquidity in dealing with finance and
personnel issues. This would include such things as using carry-over
funds, salary savings, employment contracts, teaching load
distributions, loans, and flexible course-based pricing (currently
being presented to the SBOE/Regents) which would permit some
departments, for instance, to charge higher matriculation fees for
upper-division courses. The increased revenue would then flow directly
back to the department. There is also some thought being given to
allowing colleges to balance out course load levels by charging a
higher fee at the most popular class time periods and offering a
reduced fee at the less desirable time periods.
There
will be consequences and safeguards against such downside risks as
internal competition, bunker and silo mentality, quality vs. quantity,
and financial bailouts.
RCM’s
will require very visible leadership.
RCM’s
will require a high level of competence among deans and vice
presidents. They need to have both academic and financial management
skills.
RCM’s
will require behavioral changes and the transition will be very
stressful.
Winstead
said that the initial implementation of the RCM will be on July 1, 2001,
but it will probably take four or five years to learn how to operate
effectively under this system. There are many issues that need to be
worked out – many of them based on experience. He also noted that it was
very important that we use an open process to work out issues and maintain
effective communications – including the skill of listening.
The
next steps in the RCM implementation include:
Providing
needed training – initial and on-going.
Discouraging
unhealthy competition and duplication.
Introducing
market competition for the delivery of support services – for
instance, using outside providers.
Maintaining
a balance between centralized and decentralized decision-making.
Recognizing
differences and treating RCM’s equitably.
Rewarding
achievements and performance.
Implementing
"open book" management in the transition period, hopefully
gaining the trust of the university community. Records will be
publicly available and the process open for public input and
discussion.
Having
realistic expectations – RCM is not a magic solution to every
problem.
Winstead
ended his presentation by noting that there were a number of committees
and sub-committees working on the general issues of communications,
training, revenue, and policies and procedures. The next major RCM
discussion will be at the January 2001 Leadership Retreat.
Questions/Comments/Answers:
What
brought about this whole movement to RCM? It
was driven by the U of Idaho Strategic Plan. There is also a movement
to this model nation-wide because of the change in revenue sources for
public universities. Public education is currently thought of now as a
private group rather than a public group. Therefore, it is appropriate
to fund the cost of higher education from user fees as opposed to
state tax appropriations. The university is already operating in a
market-based atmosphere in many of its activities.
What
about unforeseen emergency situations? Effective
deans and vice presidents will find answers within the college or unit
concerned. If not, then the unit may have to borrow money from the
university to handle the problem. There is a lot of flexibility built
into the system now and it will continue to be so in the new system.
Will
it be too difficult for extension and outreach units to operate under
this system? Service is now a part of the requirements for tenure and
promotion. This connection needs further discussion. The
Agriculture Research and Extension budget is doing better than the
general education budget in terms of growth rate. There is still a
state-level appropriation process which supports cooperative extension
to the extent that it does not have access to market sources, but it
does have a political constituency and access to a restricted
appropriation in an environment that has been more successful than the
rest of the university budget process. It is not a hopeless issue.
What
is to stop departments from deciding to teach courses that have been
traditionally taught by other departments? There should still be some
centralized decision-making process for handling duplication. We
already have issues of duplication. The key to making this work is not
to compete with academic units within our own institution – it is to
compete with ISU, BSU, WSU, and all the other providers of higher
education. That is where revenue growth is to be found for the whole
institution. So we should focus outward and compete in the market
place, as opposed to focusing inward and competing with one-another.
We will also be more effective if we find routes to collaboration
rather than competition internally.
How
do you handle departments that may want to switch colleges because
they see a financial advantage to such a move? If
there is some desire on the part of faculty members to make a move
then we can create mechanisms that allow that discussion to take
place.
How
does a liberal arts – core offering – department fit into the RCM
concept? Don’t overlook the tremendous
economic advantage that the liberal arts has in the dedication of core
curriculum/general education credit hours. That is an area where
typically the cost of instruction is lower than the revenue that is
attributed for those credit hours. These core courses tend to be a
very effective "cash cow" for those programs if the faculty
and college learn to take advantage of it.
Chair
McKeever asked council members who still had questions concerning the move
to the RCM model to email them to Winstead (waylandw@uidaho.edu). He will
return to the council at a later date for further discussion. She also
urged council members to contact faculty members at other universities
that have implemented the RCM model and make note of their experiences.
There will soon be a web link from the Faculty Council web page to an RCM
discussion page. This will help the administration develop
"Frequently Asked Questions" concerning RCM for its own web
site. Winstead said that at the January Leadership Retreat, there will be
people on campus from other universities comparable to ours that are
currently involved in the RCM transitional phase. Provost Pitcher noted
that the kind of discussion that we’re having and will have in the
future is very positive because it provokes options and questions – some
of which may be applicable to RCM implementation. Let’s keep thinking
creatively and keep these conversations going.
Adjournment.
There being no other business to come before the council, Professor
McKeever adjourned the meeting at 5:05 p.m.
Respectfully
submitted,
Peter
Haggart
Secretary
to the Faculty Council
