University Senate discusses new data-driven budget
Published: Tuesday, October 23, 2012
Updated: Tuesday, October 23, 2012 01:10
During the Miami University Senate meeting Monday, the Senate heard reports on a new budget model the university is moving towards for next year.
The model Miami is looking to transition to is referred to as Responsibility Centered Management (RCM). The new budget model would enable the university to better measure the financial impact of its decisions, as well as develop more transparency about where university money is going, according to David Creamer, vice president for finance and business services.
Miami’s current budget plan, an incremental approach, isn’t working, according to Rebecca Luzadis, associate professor of management and chair of Senate’s Fiscal Priorities and Budget Planning Committee.
“That model doesn’t seem to have the tools necessary, the sophistication necessary, to be able to change people’s thinking about raising money and controlling costs,” Luzadis said.
Creamer said the RCM budget approach provides more tools and data to better understand what’s going on with the university’s money, and share that information with deans and chairs as the university goes about its planning.
“It’s a business model that is adapted for higher education,” Creamer said. “It better looks at ways to incorporate what we’ve historically done, but then adding on top of that more business and analytical tools to help us make better decisions how to better measure the performance of our schools and better hold everyone inside the institution accountable for the goals that we know we need to achieve.”
Creamer also said the budget will hopefully support entrepreneurship and creativity within the university’s schools, and help better measure performance.
But this data-driven model won’t come without its challenges, Luzadis said.
“It’s kind of shocking how many decisions, large decisions, really important decisions have been made at this university without any data at all. So one of the hardest challenges in implementing this new model is generating data that’s reliable, that’s consistent over time and across units, and it’s a big challenge because we don’t have a history of doing that.”
Some Senate members had concerns about moving towards the RCM budget model. Accounting Professor Peter Brewer voiced some apprehensions at the meeting.
“I wonder…to what extent are some of the cost allocations in this budgeting model essentially arbitrary?” Brewer said. “To take actual costs and allocate them out to divisions I would say strikes me as wrong, because if the divisions’ actual costs tend to be inefficient and inflated, those cost inefficiencies are passed on to users at the division level.”
The Senate also heard a brief report from Jim Oris, associate dean of research and scholarship, about the changes taking place as a new division is established for the regional campuses. Oris said the regional campus implementation committee is working on reviewing the hiring process within the new division, identifying a distinct name for the division, and coordinating the transfer of existing programs, including engineering technology, computer and information technology, nursing, and business technology, to the new division.
The Senate also voted to table a vote regarding edits to the Graduate Faculty Information section of the Graduate Handbook. The changes, including one change that would allow lecturers and clinical faculty to be eligible to be appointed as Level A faculty with certain stipulations, will be discussed and voted on at a future Senate meeting.