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Ad Hoc Committee releases fiscal recs

Recommendations will eventually save University $26 to $57 million annually

 The committee was organized into five subcommittees: personnel, strategic sourcing and procurement, non-personnel, new revenue streams and growing the undergraduate student body.
The committee was organized into five subcommittees: personnel, strategic sourcing and procurement, non-personnel, new revenue streams and growing the undergraduate student body.

The University’s Ad Hoc Committee on Promoting Financial Health and Sustainability released its final recommendations Oct. 1, providing guidance in five categories intended to give the University increased opportunities to make “strategic investments in academic excellence” and work to eliminate its “relatively small but persistent” annual structural deficit, according to the Committee’s final report

The University will implement these recommendations through a new Program on Innovation and Financial Sustainability, which combines these recommendations with those of the Education Innovation Committee, The Herald previously reported

Once implemented, the Committee estimates that these recommendations will yield $26 to $56 million annually — $6 to $7 million in savings and $20 to $50 million in new revenue, according to the report. 

The report emphasizes that this review was not prompted by the financial difficulties of the COVID-19 pandemic. Rather, the University hopes to reduce its reliance on tuition and fees over time. 

President Christina Paxson P’19 convened the committee in fall 2020, which was organized into five subcommittees each with different focuses: personnel, strategic sourcing and procurement, non-personnel, new revenue streams and growing the undergraduate student body. It was chaired by Provost Richard Locke P’18 and consisted of students, faculty and staff. 

“Our approach was values-driven and holistic, with the goal of directing our limited resources to where they can have the greatest impact,” Locke wrote in an Oct. 1 letter. “This means ensuring the continued growth in quality of our academic programs and investing in our faculty, staff and students.”

The personnel subgroup, which focused on staffing structures, skills and training and development opportunities within academic departments, advised the University to create “centers of excellence” in which departments can share staff with specialized skills. It also recommended piloting administrative support networks within departments and centralizing operations in areas “such as cybersecurity, technology and human resources,” according to the report. 

“Little by little, the University has been evolving,” committee member Ira Wilson, professor of health services, policy and practice, said, and this committee was an opportunity “to address really fundamental issues of how the University is organized, administered and run.”

“To me, that’s the movement (away) from a tiny New England town view of how things should be run, (where) every department has all its own people even if it’s a tiny department,” Wilson added. 

The subcommittee estimated that the implementation of these measures would save $800,000 for each of the first two years and $400,000 for the two following years.

“Over time, staff will have clearer career pathways and more opportunities for professional development, and there will be less siloing among departments,” the report reads. “The University community will benefit from the highly skilled workforce more equitably and effectively.”

The strategic sourcing and procurement subgroup recommended strengthening the University’s Strategic Purchasing, Contracts and Insurance office, implementing an eProcurement technology solution — which utilizes software to expand strategic sourcing — and to update campus-wide purchasing policies. It also recommended that the University hire a second strategic sourcing category manager and a future contract manager to mitigate risks

These changes are meant to not only increase the efficiency and effectiveness of the University’s SPCI office, but also to improve transparency and ease of access, according to the report. These changes are estimated to save $1.4 million annually. 

Committee member Ella Kirsh GS identified the work of the strategic sourcing and procurement subgroup as one of the most important set of recommendations to come out of the committee’s work. “The subcommittee worked really hard, interviewing over 60 people across 15 different departments and amassing a huge tranche of data,” Kirsh wrote in an email to The Herald. “They came up with some elegant solutions to nudge the way the University handles spending and acquisitions, to produce a simpler, more transparent and less idiosyncratic set of processes.”

The non-personnel subcommittee focused on how to adopt cost-saving measures that came about due to the COVID-19 pandemic. It recommended the creation of a University travel management program as a joint effort with the strategic sourcing and procurement subgroup, and it also advised the reduction of non-critical, in-person events and their associated food and beverage budgets. 

“One of the things the pandemic did teach a lot of us ... is that you can do a lot of types of business by Zoom,” Wilson said.

These recommendations cited the University’s $22 million travel expenses from Fiscal Year 2019 as a rationale for a targeted reduction in costs. 

“Travel booking and expense reimbursement are primarily self-directed, which is inefficient, labor intensive and often frustrating,” the report continues. “Travel practices are decentralized, and while the University has a preferred travel agency vendor, it is not widely known.”

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The committee estimates these recommendations would save the University $550,000 annually, and they would also support the goal to reduce carbon emissions the University outlined in its Strategic Sustainability Plan. Aiming for a 30% reduction in pre-pandemic travel levels could save another $3.2 million annually. A 30% reduction in University catering could save an additional $1.4 million annual. 

The subcommittee on diversifying revenue streams recommended growing non-traditional academic offerings such as summer and winter sessions and pre-college programs as well as laying the groundwork to expand research commercialization through industry partnerships and royalty-paying licenses and startups. 

As part of this recommendation, the subgroup also advised the University to create more online master’s  and executive master’s programs intended for mid-career professionals.

“Universities all around the country have been doing this for a long time, and Brown, I would say, is a little bit late to the game,” Wilson said. The committee “tried to decide which programs or initiatives would both have a market presence that would be worth (it) to people but also (consider whether) they align with Brown’s skill set and mission and so forth.”

The revenue growth from increased academic programs is estimated to increase University revenue by $14 to $23 million annually. 

A final subgroup looked at the University’s undergraduate student population and recommended growing it by 5% to 10% through increased enrollment and increased study away and experiential learning opportunities to help accommodate a larger student body. The committee estimated that this would increase the net revenue of financial aid by $13 to $27 million annually. 

“Many of our discussions centered around the possibilities of bolstering and expanding Brown’s study abroad programs, so being an international student (albeit at the grad level), and indeed one outside the USA for the whole period that the committee met, informed my approach” to committee deliberations, Kirsh wrote.

Kirsh feels the committee’s recommendations will have positive long-term impacts on the University’s finances. 

“These sorts of conversations, though they seem kind of dry to begin with, actually go to the core of an institution’s personality and values,” Kirsh wrote. “The committee’s charge was open-ended enough to give the opportunity to rethink and re-examine a whole variety of different corners of how Brown functions. Pretty much everything was up for discussion and re-evaluation — that’s why the recommendations are so varied in their approaches.”

“I hope the long-term impact is to continue to open up these vital conversations to the groups who will be affected by the changes they involve,” Kirsh added, “and to see where the community takes it from here.”






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