When faced with a challenge, the people of Maine tend to be very pragmatic and straightforward. Those cultural values helped guide our approach to dealing with a rapidly growing structural gap in the finances of the University of Maine System.
Even before the international financial crisis, we were looking at a $42.8 million projected annual shortfall between revenues and expenses within four years if we continued business as usual. Trustees asked me to present them with a plan to resolve it. So I looked into my magic bag and, finding it empty, decided to take a pragmatic and straightforward approach.
Certain key values emerge rapidly when addressing a problem of this magnitude. These include transparency, authenticity, accountability and fairness. We knew we would have to make major changes but we also knew that we were going to have to do it in a way that didn’t create its own opposition. To accomplish this, we formed three work groups—one academic, one administrative and one about governance—to begin to gather ideas and prepare reports. We held 20 public forums, which helped inform creation of a multiyear plan called “New Challenges, New Directions,” endorsed by the trustees in November 2009.
There are two fundamental ways to approach a project like this. You can move swiftly to prepare a plan and then deal with high implementation costs. Or you can spend more time in broad discussions and open meetings to ensure that people have a voice in the processes and thus reduce implementation costs. We chose the latter approach; so by the time we had completed a plan, people were highly aware of its contents and its goals. We shared financial data and we shared alternative approaches to problem solving. I joked that as I drove across the state to talk about it, there was a trail of draft reports flying out the car, littering the interstate.
The plan has three fundamental goals: 1) better serve the state and ensure that the university advance the needs of our citizens and our economy; 2) control tuition costs; and 3) attain fiscal sustainability within four years.
In doing this, we are looking at three broad areas of work. The first is to conserve academic resources by engaging activities such as the “12/5” rule: That is, any class enrolling fewer than 12 students must be given a review for academic necessity; any program graduating fewer than five students per year has to justify its funding. We are also looking at how we can collaborate on programs, expand online programs, add three-year degree programs and bring more resources to bear on critical needs such as allied health and nursing, to name a few initiatives.
In the administrative realm, the question became: How much “system-ness” really provides efficiency? A simple knee-jerk answer is that centralizing saves money. We are trying to increase efficiency while giving campuses greater input on which particular activities will be centralized. A solid business case has to be presented for anything that might be centralized such as purchasing, energy management or online programs.
The third area of work—structure and governance—is the most sensitive. To avoid having a firestorm at the start, we indicated very clearly that no campuses would be closed. This does not stop us from asking campuses to share resources nor from looking at different structures for providing services—for example, our plan proposes that one campus be responsible for managing online programs, another campus be responsible for energy management .
How is it working? There is a decent base of support at this point and we are proceeding in a steady manner. Each of the 40-plus action items have specific milestones and benchmarks. We find people are engaging the stated purposes, and accountability is rising. The logic is compelling. If we save money, if we are more efficient, then we can serve students more effectively and focus our resources more strategically. This is a multiyear effort, and we understand that different parts of it will move at different rates. But we believe that having spent adequate time in building support in advance, bringing as many voices to the table as possible, and sharing ongoing ownership and leadership that this work will have the momentum needed to carry it through.
What lessons have we learned? If we could do this over, we probably would have been more precise on the meanings of certain concepts such as decentralization of services and the strategic investment fund. We would have been more precise early on about the process itself in terms of dates, deadlines and work products. I think that we would have prepared the work groups more carefully by giving them a clearer charge.
It’s never easy to move a large organization in a new direction. Current difficult economic conditions have certainly given us more energy and leverage for the work. To succeed at this, leaders need to have the courage of their convictions, good colleagues on campus and in the administration, the solid backing of their trustees, flexibility and a clear commitment to where they want to go. And if that goal is based upon deep belief in serving students and the state, then one is comfortable in taking action and risks.
This work serves the public trust. Future generations count on us to do it well. Therefore it’s incumbent to reflect upon it carefully before proceeding, work openly and share credit for all that is done. There’s more work to do. But I think we are headed in the right direction at the University of Maine System.
_________________________________________________________________
Richard L. Pattenaude is chancellor of the University of Maine System and former president of the University of Southern Maine.
[ssba]