Powers Announces Major Push for Efficiency
As the legislature considers funding for Texas colleges, UT is unveiling a plan to save money—and generate more.
Updated 2:22 p.m.
Efficiency has been a watchword in higher education for years, particularly among policymakers in Texas. Now UT-Austin is launching a full-scale effort to improve UT’s efficient use of funding by cutting costs and generating revenue. In a major speech on campus Tuesday, University president Bill Powers announced a number of reforms designed to better manage the University’s funding.
Power’s speech coincides with the release of a report from the Committee on Business Productivity, a group of 13 business executives convened by Powers last spring. Their report, titled “Smarter Systems for a Greater UT,” emphasizes three main areas that informed most of the president’s speech: consolidation of administrative departments, managing resources and services, and the way the University promotes and makes money from its intellectual property.
“The ramifications of the Committee’s report are sweeping,” Powers said Tuesday. “The combined recommendations could yield as much as $490 million over a decade. That is a lot of money, and we could do a lot with it.”
The first recommendation involves the consolidation of finance, procurement, human resources, and information technology. Right now, many of those functions are duplicated across the different academic units of the University. According to the report, these “shared services” could save UT $200 million over the next 10 years. In his speech, Powers called the recommendation a “no-brainer.”
“We’ll have to figure out the details as we move forward. But there is no doubt in my mind that these recommendations represent the direction that we need to go.”
The report also recommends that the University concentrate more effort on making money from its intellectual property. The effort is meant to build on the commercial possibilities of UT’s research, including invention disclosures, licensing, and the creation of start-ups. Earlier this month, UT named intellectual property lawyer Dan Sharp as the director of UT’s office of technology commercialization.
The report encouraged the University to increase its total volume of product licenses, rather than attempt to judge which would work and which would not.
The final area of study—asset utilization—is likely to be more controversial and carefully watched. Alongside energy conservation, the report suggests outsourcing services like parking and dining. The Texas A&M University System undertook a similar plan, which has reportedly generated millions in new revenue. The committee estimated that UT could save $290 million over 10 years.
Steve Rohleder is a group chief executive with the global consulting group Accenture and chaired the committee. He says no other university in the U.S. is tackling such a broad portfolio of efficiency reforms. Rohleder says Powers led the group without constraining them.
“His leadership was fantastic,” Rohleder said. “I don’t know how else to say it.”
While Powers said that some of the recommendations may not be adopted, the University will commit to the first goal of consolidating services. He has tasked UT vice president and chief financial officer Kevin Hegarty with overseeing the reforms that come out of the report.
“We’ll have to figure out the details as we move forward,” Powers said. “But there is no doubt in my mind that these recommendations represent the direction that we need to go.”
You can read the text of President Powers’ address here.
You can view the entire report of the Committee on Business Practices here.
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