Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc March 17, 2004 Accelerating the New Business Architecture An Update for the Regents of the University of California

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc The New Business Architecture for UC

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc Page 7 of Report Provide integrated access to business transactions, policies and training The New Business Architecture for UC

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc Page 7 of Report Establish UC as a competitive employer and provide staff the tools to improve productivity The New Business Architecture for UC

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc Page 7 of Report Redesign processes to improve our efficiency and effectiveness The New Business Architecture for UC

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc Page 7 of Report Invest in technology to replace manual, paper- based work processes The New Business Architecture for UC

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc Page 7 of Report Improve integration of and access to financial data The New Business Architecture for UC

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc Incorporate metrics to improve performance and manage risk The New Business Architecture for UC

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc Budget reductions – Focus in 2004 Managed Risk: address the increasing risks associated with long term under-funding of institutional support Cost savings: maximize the return on institutional support investments Collective solutions: recognize the need to solve campus problems once (not ten times) Greater leverage: leverage UC size and purchasing power Flexibility: accelerate New Business Architecture solutions which enable UC to accommodate both growth and downsizing without compromising service levels Regulatory burden: lessen the cost and administrative impacts of regulatory compliance New Business Architecture strategies today include:

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc The UC budget has grown since the late 1980’s… Dollars in Thous ands

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc …While institutional support has declined in proportion to UC’s budget

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc Department Administration (Academic, Clinical, Auxiliary) Central ) Offices (Payroll, HR, Travel ) The majority of campus administrative costs are in departments... …Reducing administrative costs requires a comprehensive view of administrative services

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc An example from UC San Diego: Streamlining the Management of Grants

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc An example from UC Irvine: Streamlining Student Processes :

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc An example from UCLA: Streamlining Accounting Processes

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc New Business Architecture: Doing more via the Web Business and student portals for information delivery Employee benefits enrollment E-recruitment Training New financial reports in support of GASB accounting

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc Employee self-service : Eliminating paper processes and staff intermediaries for employee information –Your Benefits Online-- Open enrollment costs reduced $125,000/year –UC For Yourself $700,000 annual savings will result from putting W2’s and direct deposit statements online New Business Architecture: Doing more via the Web

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc New Business Architecture – Developing common solutions UC-wide system for reporting effort on federal contracts and grants Multi-campus e-procurement initiative Borrowing the best ideas from corporate partners such as Gartner Group, IBM, Cisco, Microsoft, and others Joint campus development of business content for the web Common authentication framework across campuses

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc Cost Reduction Strategies & Challenges for Facilities Strategic management of energy resource dollars –Direct access energy contracts saved UC over $40 million since 1998 –Cogeneration and Thermal Energy Storage are also being used by campuses to save energy dollars Risk to facilities from under-funding on-going maintenance ($45M), and no funding of new space ($5.9M in 03/04, $14.9M in 04/05) Half of UC’s million gsf of space is State-eligible Need for $200M/year in capital renewal to avoid much larger costs in the future (no $’s since 01/02)

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc Strategic Sourcing –UC-wide spend diagnostic and procurement teams for 20 top commodity groups –Targeted savings and cost avoidance on vendor contracts: $34 million in 03/04, $46 million in 04/05 Expected cost savings on consulting contracts External Debt restructuring using General Revenue Bonds has resulted in PV savings of $53 million Leveraging UC’s Size and Strength

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc Health & safety legislation Privacy/personal information legislation HIPAA & GLB compliance Patriot Act compliance New GASB financial reporting procedures OMB Circular Certification requirements SEVIS compliance Federal cost accounting standards High Workers’ Compensation costs UC’s regulatory burden and costs increases affect ability to manage those costs

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc Regulatory increase over the last ten years

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc Restructure the process for delivering capital projects and revise the rules for competitive bidding Streamline State rules for claims submission and contracting with State agencies Provide UC with greater flexibility in payment methods for employees Seek relief from certain regulations that impede the mission of UC Target opportunities for legislative and regulatory change

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc Staff Salary Competitiveness Poses Risk

Regents Update New Business Architecture Project 2010 Jan00 meeting notes.doc In Closing Budget Reductions and increased workload will pose significant challenges to UC’s already lean infrastructure The New Business Architecture effort is implementing a series of initiatives that will require key investments in technology and collaborative strategies to reduce costs and increase productivity Our greatest risks are in under-funding staff salaries and facilities