Flexibility and Productivity Presentation to APC 7 th March 2008
description
Transcript of Flexibility and Productivity Presentation to APC 7 th March 2008
Flexibility and Productivity
Presentation to APC
7th March 2008
Contents
• What have we achieved in the last few years?
• What do we plan to do?
• Is it enough?
Financial History
Income growth by five-year period (adjusted for inflation)
-2%
-1%
0%
1%
2%
3%
4%
5%
6%
7%
8%
Av
era
ge
11
-15
16
-20
21
-25
26
-30
31
-35
35
-40
Years
% s
urp
lus
Financial Accounts Surplus 1964-2004
-15 .0%
-10 .0%
-5 .0%
0 .0%
5 .0%
10 .0%
% s
urp
lus
Estates Investment
Financial Summary of Investment£m’s
Residences 200
Capital Programme (last 5 years) 90
Capital Programme (next 5 years) 110
Growth investment 100
500
(Plus Science Park)
Masterplan
Projects in Progress
ISS Building Sports Centre Waterside Biology C Floor County South University House LICA/Imagination Learning Zone Infrastructure
Finance Strategy
Finance Strategy (Draft)
• Need for £40m - £100m investment
• On and off balance sheet
• Phase V
• Surplus 4 to 5%
• Revenue has to grow 1.5% faster than costs (excluding interest and depreciation)
Finance Strategy Challenges
• Investing in the right areas
• Managing our cost base
• Balancing short and long term pressures
• Communicating the strategy
• Management information
• Change management
IT Investment
Information Systems Projects 2004-8
• Estates Management System• HR & Payroll• CRM – Alumni, Corporate, Events, Student Support• Decision Support (Admissions)• Residences and Conferences• Teaching Timetable• Flexible Benefits• Agresso 5.5
Information Systems Projects – possible work
• Web Infrastructure Programme
• Further CRM applications including support for Postgraduate Recruitment Processes
• Decision Support (other)
• Virtual Research Environment
• Award Management
ICT Strategy Impact
• Web Infrastructure Programme– Web experience will be tailored through a portal and
expanded to include access to key institutional data
– Web Content will be managed• Family resemblance across all institutional web pages
• Greater coherence in quality and identity
• Modern governance processes• ISS as curator• Support for teaching, learning and research
Process Review
Process Reviews • Rolling programme to review all University processes:-
– Do they do what they are supposed to?– Are they efficient?– Do they support our strategic direction?
• Started with Finance– Diagnostic work complete in 2007– Implementation in progress (Agresso 5.5)
• Currently reviewing Postgraduate Recruitment– Report due in April
• Future areas under review, possible candidates are:– HR processes– Management of the student record– Student support processes
Cost of Finance Processes
The total staff cost of finance in commercial organisations as a percentage of turnover is :
Top quartile 0.5%
Median 0.9%
Bottom quartile 1.8%
LU cost is around 3.1% which places us below the
bottom quartile (£3.9m out of £127m).
Realistic targets What is an appropriate target for us?
LU is not-for-profit (higher costs as a % of turnover)
LU may be subject to greater regulation than commercial businesses e.g. procurement regulations and funding body requirements
The companies involved in benchmarking are likely to be the more efficiency-focussed companies
BUT – even if we were only to achieve the bottom quartile figure of 1.8%, this would represent a saving of £1.5m per annum
Benefits expected from Finance process changes
• Reallocation of Resources– Reduced effort on transaction processing– Removal of parallel systems, further reduction in effort– Resources reallocated either to better finance support,
e.g. more time on analysing and interpreting information, or to front-line activities
• Better decision-making– Better reporting– Better analysis
• More efficient and effective budgeting and planning processes
Common Messages
• Our processes have developed in an ad-hoc way• Many tasks are done by people who are not
adequately supported or trained.• Growth means we can’t manage this by informal
networks anymore• A lot of time is wasted looking for information• Many departments are too small to do all the
things they are expected to do
Why is this important?
• Growth in research and teaching needs to be supported by appropriate processes and infrastructure
• Too much resource is being wasted
• Not a problem for the finance department
• If we don’t change things academic development will be constrained
Asset UtilisationCE/CP Ratio Comparisons
Lancaster University 2.27
Sector - Research Intensive 2.2
Sector - Small & Specialist 2.6
Sector - All other 1.9
Sector overall - England 2.1
Teaching Space Utilisation
(2005 EMS)
• Median frequency 54%
• Median occupancy 49%
• Median utilisation 27%
(0900 to 1700 Monday to Friday)
Percentage Pension Costs2002/03 to 2010/11
Average fee (price) increases compared with turnover (volume) growth 2005/06 to 2008/09
Cumulative Percentage Increases on Turnover and Pay 2002-2011
% increase in staff costs by type
HEFCE (T) Grant£000’s
2007/08 26,526
ASNs (246)
ELQ (597)
WP (346)
Inflation/other 776
2008/09 26,113
HEFCE (R) Grant
£000’s
2007/08 17,752
Mainstream increase 166
Business research element (151)
Other (21)
2008/09 17,746
Staff Balance
Academic Staff - total 31%
- (exc T & R only) 20%
Clerical (& related) 21%
(Faculties 11 -24%)
Things are Changing (internal)
2002 2007 % change
Turnover £95m £149m 56%
Staff FTEs 1,680 2,120 26%
Student Numbers 8,520 9,765 15%
Things are Changing (external)
• League Tables
• Metrics
• Fees/student influence
• Accreditation and audit
• Expectations and choice
• HR legislation
Are we changing fast enough?
Management Information
• KPI’s for Council
• Thematic reports
• Decision Support (Admissions)
• Decision Support (Registration)
Things that still surprise us
• How many students drop out within and between years
• How many sessional staff we have
• How big the estate is
• Not to mention reconciling HESA/HESES
/EMS/TRAC
Organisational Issues
• Faculties restructured
• Basic departmental structure remains (although this is changing)
• The administration has not changed significantly
Organisational muddles
• Jobs that can’t be done
• Lack of scale in “departments”
• Huge variety in organisation structures and reporting lines
• High level of dependence on individuals
Flexibility
How quickly can we adapt to…….
• Changing application patterns?
• Changing student needs?
• Changing legislation?
• Changing political priorities?
Governance
• Not just about committees
• Authorities and accountability
• Volume of paper vs clarity of decision
• What does consultation really mean?
• Ending silos
Change Management
Directed or devolved?
Directed Devolved
•clear•time bound•concerted•consistent
•owned•appropriate•accepted
Change Management
• What do you need to make it effective?– Information?– Project management Resource?– Training?– ……………?
HR Strategy
An underpinning theme
• Performance Partnership
• Modern policies and procedures
• Effective processes and systems
• Management information
• Succession planning
Final thoughts
• Life is getting tougher
• We can’t change everything
• But we can’t stay still either
• Over to you