Looking to save money, the University of Missouri system is exploring ways to consolidate some of its operations with MU.
The plans were made public in July when MU Chancellor Richard Wallace announced his plans to retire in August 2004.
UM system President Elson Floyd has noted that budget cuts and Wallace’s retirement present the university with an opportunity to build a new higher education model. He called for drastic measures.
“We have reduced administrative overhead about as far as we can, given our present structure and missions,” Floyd said in a July press release. “Bold steps must be taken if we are to position the university to address budgetary constraints in FY05 (fiscal year 2005) and beyond.”
Whether consolidation is to be pursued will be decided at the Board of Curator’s meeting in December.
The organizational charts of both the UM system and MU campus show similarities, but administrators said it’s hard to devise a plan when there is no model to follow.
The most dramatic change being considered would be to combine two key positions, UM system president and MU chancellor. In this scenario, Floyd would govern both institutions.
“Dr. Floyd is in an exploratory period in which his staff is working with counterparts on the MU campus to determine whether the merger is feasible and desirable,” UM system spokesman Joe Moore said.
Floyd said there are two steps to be taken before considering consolidation. The first step, having executive offices from both the UM system and MU campus report their job duties to Floyd, has been completed. The second step is under way and involves identifying overlapping structures, Floyd said.
Steve Lehmkuhle, UM vice president for academic affairs, said that because the UM system is mission-defined, it is not following a model for the possible consolidation. Mission-defined means all UM campuses provide doctoral-level programs and focus on research.
Most universities that have tried combining leadership positions operate a mixed system, Lehmkuhle said. A mixed system is usually comprised of a large research university and a few smaller branch campuses — the University of Tennessee system and the University of Houston system in Texas are both examples where the system president is also chancellor of the main campus.
“To my knowledge, I am not aware of a mission-defined system where there has been a combination of the campus and system leadership,” Lehmkuhle said.
Benefits and drawbacks
Systems that operate separately from their campuses and those that operate together with a campus both have advantages and disadvantages, said Peter Ewell, who serves on the board of Truman State University. Ewell is also vice president of the National Center for Higher Education Management Systems in Boulder, Colo. The administrative benefits tend to be higher than the academic ones, Ewell said.
Nationwide, about as many university systems are being broken up into individual campuses as are consolidating, Ewell said. Reorganization decisions are made in times when administrations feel things aren’t going well.
“If they don’t have a system, they try to make one, and if they’ve got one, they try to break it up into individual campuses,” Ewell added.
Reasons for reorganizing campuses into a university system include:
Disbanding a system is usually the result of campuses wishing for more independence in the way they conduct their business. Frequently, campus leaders are frustrated by having two layers before they get to the governing board — first chancellor, then president, said Paul Lingenfelter, executive director of the State Higher Education Executive Officers, a Denver-based, nationwide association of chief executive officers serving on university governing boards.
The University of Missouri is not considering disbanding its system, but rather integrating it with the MU campus and finding ways they could operate together.
Lehmkuhle said the major concern is that consolidation might be perceived as giving one campus an elevated role. Referring to the four-campus system, he said that when institutions are the same in terms of the purpose they serve, consolidation is not easy.
“It is very difficult for a person who is serving as the chief executive officer of what is already the most powerful campus in the system to put aside those tendencies when trying to operate as a system head,” Ewell said. “Systemwide issues tend to be displaced.”
Floyd, who was appointed in January, has made a reputation for himself as a strong president. The curators authorized him to review structures within the UM system and the MU campus and to consolidate positions and functions as he sees fit.
Will consolidation help the UM system save money? Moore said the system’s general operating budget suffered cuts and withholdings from the state totaling about $158 million in the past three years. That is more than four times the UM system administration budget for 2003-04.
“We don’t have funding to do everything we want to,” Moore said. “We need to find out if there are cost-effective ways to operate the system.”
Rep. Chuck Graham, D-Columbia said he thinks money could be saved.
The UM system is addressing savings as the process moves along.
“Savings could come from a reduced payroll, but it is too early to tell,” Moore said.
The university may be able to save money by consolidating, Lingenfelter said. It is always legitimate to consider workable administrative changes that can save money for higher priorities, he added.
Not everyone uses an optimistic tone in talking about consolidation.
Ewell said it takes time to get used to a reorganization. At least for a year or two, nobody is able to get anything done because everyone is trying to learn new jobs, he said.
“Most reorganizations that are done to save money don’t end up saving money,” he said.
Steps taken so far
Consolidation of positions is not a new item on the UM system agenda. The information technology services of the UM system and MU’s Information and Access Technology Services announced in September 2002 that they were going to start consolidating.
So far the consolidation has saved $3 million, which was given to Wallace to use for fiscal year 2003 and has meant the loss of 50 people. Last year, 20 employees out of the 50 took voluntary early-retirement, which the UM system offered between June 1 and Sept. 30, 2002, to faculty and staff. Ten other positions were cut, and 20 people were lost through attrition.
The consolidation process is expected to save $3 million to $5 million more by the end of fiscal year 2004, said Ralph Caruso, UM system vice president of information systems. Ed Mahon, IATS chief officer, remained in charge of campus operations — reporting to Brady Deaton, MU’s executive chancellor and provost, and to Caruso, who reports directly to Floyd.
Just last month, the curators approved a new UM system position, vice president for governmental relations. Steve Knorr, former assistant to the president for federal relations, was named to the post. Knorr said Floyd wanted to create a unified approach that would help the UM system in front of state legislators in Jefferson City. All governmental affairs offices from the four campuses were asked to work with Knorr.
The campus officers now report directly to the president’s office, not to their campus chancellor. Knorr said this gives the UM system a unified voice.
Knorr said no layoffs were necessary. As a result of the consolidation, two open administrative positions in the governmental relations operation at MU were combined.
“I think immediately it saves around $80,000,” he said. “This is a good example of the types of things that can happen under a consolidation.”
Cristian Lupsa covers the changing face of the UM System. E-mail: firstname.lastname@example.org. Phone: 882-5720.