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Title: UA Fellows Program Seminar on Strategic Planning and


1
UA Fellows Program Seminar on Strategic Planning
and Budgeting
February 1-2, 2007
2
Day 1 Overview
  • Introductions and Workshop Goals
  • Overview of University Organization
  • Strategic Planning Management
  • Strategic Planning Defined
  • Key Terms and Concepts
  • Strategic Planning Process
  • Strategic Planning at the U of I Planning
    Parameters
  • Environmental Assessment
  • U of I Mandates
  • Strategic Planning at the U of I Process,
    Timeline, and Highlights
  • Strategic Planning Process and Timeline
  • Highlights from U of I Strategic Plans Stages
    1-3
  • Ensuring Execution at the University of Illinois
  • Plan Development and Execution FY06 FY08
  • FY08 Budget Request
  • Five Year Resource Scenarios
  • Day 1 Wrap-Up

Page 2
3
  • Introductions Workshop Goals

Page 3
4
Introductions
  • Presenter
  • Dr. Doug Vinzant
  • Associate Vice President for Planning
    Budgeting
  • 338 Henry Administration Building
  • (217) 333-6600
  • dvinzant_at_uillinois.edu
  • Also Presenting
  • Dr. Dan Layzell
  • Assistant Vice President for Planning Policy
    Analysis
  • 338c Henry Administration Building
  • (217) 333-6600
  • dlayzell_at_uillinois.edu
  • Dr. Randy Kangas
  • Assistant Vice President for Budgeting
  • 321b Henry Administration Building
  • (217) 333-0398
  • rkangas_at_uillinois.edu

Page 4
5
Workshop Goals
  • Develop understanding of strategic planning and
    management concepts, terms, and processes, and
    their application at the University of Illinois
    (Day 1)
  • Develop understanding of budgeting/resource
    allocation concepts, terms, processes, and trends
    at the University of Illinois (Day 2)
  • Discuss mechanisms for creating stronger linkages
    between planning and budgeting at the University
    of Illinois (Days 1 2)

Page 5
6
  • Overview of University Organization

Page 6
7
UA Organizational Chart
Page 7
8
UOPB Organizational Chart
Vice President for Planning and Administration
Stephen K. Rugg
Vice President for Academic Affairs tbd
Chief Financial Officer Walter Knorr
Associate Vice President for Planning
Budgeting Douglas H. Vinzant
Administrative Aide Teresa Howard Staff Secretary
Tara Smith
Assistant VP CARLI Executive Director Susan
Singleton
Assistant VP Budget Randy Kangas
Executive Director Decision Support Linda Bair
Assistant VP Strategic Planning Policy
Analysis Dan Layzell
Project Director Advancement Technology Andrea
Ballinger
Director CARLI User Services Kristine J.
Hammerstrand
Administrative Assistant Cheryl A. Brown
Resource Policy Analyst Tyler Kearney
Administrative Support Diane Peacha
Director Institutional Studies Analysis Barb
Welge
Budget Planning Analysis Jo Menacher Andy
Sestak Linda Meyer Andrea Hoey Sandy Street
Associate Director CARLI Data Services Catherine
I. Salika
Library System Coordinators Mary Ellen
Farrell E. Paige Weston Jennifer H.
Masciadrelli Mary Kay Sutherland Jessica C.
Gibson Lorna J. Engels Amy Maroso
Assistant Director (open) Kevin Knott Siew
Szetho Pam Lowrey El Gentry Jonathan Laird
Business Coordinator Lisa Courtney
Technical Architect Michael Wonderlich
Data Architect Mark Cumbow
Director Information Services John Evans
Gordon J. Fellows Anne S. Hudson Kathy K. Chang
Data Designers Nick Arend Bill Failey Chris Stoops
Support Services
Business Architect Aaron Walz
Technical Analyst Vacant
Staff Secretary Terry Smith
Mark Anderson Nathan Wilds Kristopher Smith
Secretary III Rebecca Blackburn
Director CARLI Electronic Resources Thomas J.
Dorst
Functional Area Coordinators Beth Ladd Michelle
Bergman Mark Pollard Jim Clennon
User Support Polly Kroha Marcia Tarvin Buddy
Strube
ETL Developers Kiran Avadhanula Udaya
Marreddy Guru Ramamurthy
BI Specialist Ruth Wieties
CARLI Web Edward M. Schell
Administrative Secretary Angie Rhodes
Library Systems Coordinator David H. Hamilton
Data Quality Analyst Jennifer Selk
Implementation Coordinator Deb Coggins
Communications Vacant
Business Analyst Amanda Bodine ITPC Project
Support Lisa Fogarty
Director CARLI Business Financial
Services Connie D. Walsh
Assistant Director CARLI Systems
Services Brandon Gant
Sr. Project Managers ITPC Project Support Heather
Hafner Lisa Kuechle
Application Developer Raman Tyagi
Accountant Diane E. Day
Requirements Analyst Heather Hafner
Christopher G. Saunders Todd A. Pavik Christopher
E. Delis Patrick Zurek
Sr. Administrative Information Systems
Consultant Bernard G. Sloan
Director CARLI Collection Services Elizabeth C.
Clarage
Note Organizational Chart updated as of February
2007
Page 8
9
  • Strategic Planning and Management

Page 9
10
Strategic Planning - Defined
  • Many different approaches to strategic planning
  • Strategic Planning a disciplined effort to
    produce fundamental decisions and actions that
    shape and guide what an organization (or other
    entity) is, what it does, and why it does it
  • Strategic Planning a process used to establish
    strategic intent

Key Takeaway Strategic planning is a set of
concepts, procedures, and tools designed to help
leaders, managers, and planners think, act, and
learn strategically.
Bryson, John M. Strategic Planning for Public
and Nonprofit Organizations 3rd Edition.
Page 10
11
Strategic Planning - Benefits
  • Benefits of Strategic Planning
  • Promotion of strategic thinking, acting, and
    learning, especially through dialogue and
    strategic conversation among key actors
  • Improved decision making
  • Enhanced organizational effectiveness

Key Takeaway Strategic planning helps
organizations deal with changing environments.
It can help them build on strengths and take
advantage of major opportunities while they also
overcome or minimize weaknesses and serious
challenges.
Bryson, John M. Strategic Planning for Public
and Nonprofit Organizations 3rd Edition.
Page 11
12
Strategic Planning - Key Terms
  • Guiding Values
  • The fundamental principles and behaviors that
    embody how the planning unit and its people are
    expected to operate. Guiding values reflect and
    reinforce the desired culture of the planning
    unit.
  • Mission
  • The overall function of the planning unit what
    it is trying to accomplish. A mission statement
    clarifies an organizations purpose, or why it
    should be doing what it does.
  • Vision
  • The desired future state of the planning unit.
    The vision describes where the planning unit is
    headed, what it intends to be, and/or how it
    wishes to be perceived in the future.
  • Statement of Strategic Intent
  • A brief synopsis of what the planning unit
    intends to achieve through its strategies and how
    it plans to go about achieving them.
  • Environmental Assessment
  • An analytical technique by which the planning
    unit assesses the key external and internal
    factors that are or will have an impact on the
    development and execution of the planning units
    strategic plan, including demographic,
    educational, economic/fiscal, social, and
    political factors.

Page 12
13
Strategic Planning - Key Terms (continued)
  • Strengths, Weaknesses, Opportunities, and Threats
    (SWOT) Analysis
  • An analytical framework within which the planning
    unit evaluates its internal (strengths and
    weaknesses) and external (opportunities and
    threats) environment and the related implications
    for the strategy development and execution.
  • Strategic Issue
  • A fundamental policy question or critical
    challenge affecting a planning unit. Strategic
    issue description should phrase the issue as a
    question, identify factors that make it an issue,
    and articulate the consequences of not addressing
    the issue.
  • Strategic Goal
  • A future condition or performance level that the
    planning unit intends to attain. Goals are the
    ends that guide the actions.
  • Strategic Thrust
  • The specific actions, activities, or conditions
    that enable or contribute to the successful
    attainment of strategic goals. As such,
    strategic thrusts are directly related and
    subsidiary to strategic goals.

Page 13
14
Strategic Planning - General Approach
Vision, Mission, and Goals
Where You Want to Be Mission and
mandates Structure and systems Communications Prog
rams and services People and skills Budget Support

Where You Are Mission and mandates Structure and
systems Communications Programs and
services People and skills Budget Support
Strategic Issues
How to Get There Strategic plan IT and HR
plans Communications Hiring and
training Restructuring and reengineering Budget
allocations
Strategy Implementation
Strategy Formulation
Bryson, John M. Strategic Planning for Public
and Nonprofit Organizations 3rd Edition. P. 7.
Page 14
15
Overview of Strategic Planning (SP) Process
Review Mandates
Mission Purpose
Key Takeaway Though presented in a linear,
sequential fashion, the strategic planning
process is iterative. Steps may be repeated as
groups continuously rethink the connections
among the various elements of the process, take
action, and learn on their way to formulating
effective strategies.
Environmental Assessment
SWOT Analysis
Identify Strategic Issues
Strategy Formulation
Strategy Execution
Strategy Reassessment
Bryson, John M. Strategic Planning for Public
and Nonprofit Organizations 3rd Edition. P. 61.
Page 15
16
SP Concepts - Review Mandates
  • Before an organization can define its mission
    and values, it must know exactly what it is
    formally and informally required to do (and not
    do) by external authorities.
  • Formal requirements are likely to be codified in
    laws, regulations, ordinances, articles of
    incorporation, charters, and so forth.
  • Informal requirements can be embodied in norms or
    expectations.

Bryson, John M. Strategic Planning for Public
and Nonprofit Organizations 3rd Edition. P.
97-98.
Page 16
17
SP Concepts - Mission
  • A mission statement clarifies an organizations
    purpose, or why it should be doing what it does.
  • Benefits of a clear mission statement
  • Focuses discussions on what is truly important
  • Clarifies strategic intent, which can lead to
    better performance
  • More consistent, effective leadership
  • May lead to fewer conflicts, especially involving
    resource allocations
  • Helps define an organizations strengths and
    weaknesses

Bryson, John M. Strategic Planning for Public
and Nonprofit Organizations 3rd Edition. P.
102-106.
Page 17
18
SP Concepts - Vision
  • A vision statement is a description of what the
    organization will look like after it successfully
    implements its strategies and achieves its full
    potential.
  • A comprehensive vision statement (or vision of
    success) may include
  • An organizations mission
  • Its basic philosophy and core values
  • Its basic strategies
  • Its performance criteria
  • Its important decision rules
  • Its ethical standards
  • Key Takeaways
  • While a mission statement includes why an
    organization should be doing what it does, a
    vision statement clarifies what it should look
    like and how it should behave as it fulfills its
    mission.
  • A mission statements serves as the foundation for
    the vision statement.

Bryson, John M. Strategic Planning for Public
and Nonprofit Organizations 3rd Edition. P.
102, 237.
Page 18
19
SP Concepts - SWOT Analysis
  • Assessing the environment is a key step in the
    strategic planning process. SWOT Analysis is a
    framework for organizations to evaluate both
    their internal and external environments.

trengths
Internal Environment
eaknesses
SWOT
pportunities
External Environment
hreats
Page 19
20
SP Concepts - Strategic Issues
  • A strategic issue is a fundamental policy
    question or critical challenge affecting an
    organizations mandates, mission and values,
    product or service level and mix, clients, users
    or payers, cost, financing, structure, processes,
    or management.
  • Identifying strategic issues is one of the most
    important and potentially one of the most
    difficult steps in the planning process.
    Virtually every strategic issue involves
    conflict over what will be done, why it will be
    done, how and how much of it will be done, when
    it will be done, where it will be done, who will
    do it, or who will be advantaged or disadvantaged
    by it.
  • Strategic issue description should
  • Phrase the issue as a question
  • Identify the confluence of factors that make it
    an issue (mission, mandates, SWOT, etc.)
  • Articulate the consequences of not addressing the
    issue

Bryson, John M. Strategic Planning for Public
and Nonprofit Organizations 3rd Edition. P.
153, 159.
Page 20
21
SP Concepts - Strategic Issues
  • Strategic issues arise in 3 situations
  • They can arise when events beyond the control of
    the organization make or will make it difficult
    or impossible to accomplish basic objectives
    acceptably and affordably.
  • They can arise when technological, cost,
    financial, staffing, management, or political
    choices for achieving basic objectives are
    changing or will soon change.
  • They arise when changes in mission, mandates, or
    internal or external factors suggest present or
    future opportunities to
  • Make significant improvements in the quantity or
    quality of products or services delivered
  • Achieve significant reductions in the cost of
    providing products or services
  • Introduce new products or services
  • Combine, reduce, or eliminate certain products or
    services
  • Otherwise create more public value

Bryson, John M. Strategic Planning for Public
and Nonprofit Organizations 3rd Edition. P.
153, 159.
Page 21
22
SP Concepts - Use/Sources of Data
  • Numerical data and performance metrics are needed
    in comparative analysis and benchmarking
    exercises.
  • 2 words of caution
  • Performance metrics should be developed after the
    strategic issue has been framed. This prevents
    the use of metrics simply because they are
    readily available or easily measured.
  • Good comparative data sources are sometimes
    difficult to find for a given metric.
    Understanding the limitations of the data sources
    is essential.

Page 22
23
SP Concepts - Use/Sources of Data
  • The following list includes many potential
    sources of data. The quality and reliability of
    the data varies and limitations should be
    understood before the data are used in a
    comparative analysis or benchmark.

Page 23
24
  • Strategic Planning at the U of I
  • Key Planning Parameters

Page 24
25
Environmental AssessmentDemographics
  • Illinois will experience slight population growth
    in coming years.
  • As with the rest of the U.S., Illinois
    population will become more diverse and the
    Hispanic population will grow faster than any
    other segment.
  • The proportion of African-American students at
    UIC and UIUC grew slightly after a period of
    decline, while the proportion of Hispanic
    students has generally grown at all three
    campuses in recent years. Pressure from
    University stakeholders to enhance diversity
    among students, staff, and faculty will continue.
  • The over 50 population will grow rapidly. This
    aging population will put increasing pressure on
    social services and health care and may view
    higher education as less of a priority in the
    future.
  • A significant proportion of the Universitys
    tenure/tenure-track faculty are age 55 or over
    creating the potential for large numbers of
    retirements in the near future.

http//www.uillinois.edu/president/strategicplan/
Page 25
26
Environmental AssessmentHigher Education
  • U.S. competitiveness in higher education
    participation, completion, and attainment, while
    still strong, is slipping relative to other
    developed and developing nations.
  • The college age population will grow nationwide,
    but this growth will vary greatly among regions.
    The West, Southwest, and Southeast will
    experience growth that will exceed capacity in
    public higher education, although in general the
    Midwest will not.
  • A larger percentage of women are attending higher
    education than men and the gap is increasing.
  • Competition from proprietary institutions and
    other non-traditional educational providers in
    the marketplace for students (both nationally and
    internationally) has greatly increased in recent
    years.
  • Growth in faculty compensation at private
    institutions has surpassed public universities,
    and the intense competition for faculty will
    continue.
  • Relatively flat incomes at the lower income
    brackets in recent years will have implications
    for tuition and financial aid policies
    particularly with regard to promoting access for
    low income and first-generation students.
  • Rapid technological innovation has led to a need
    for lifelong learning that will allow individuals
    to continuously adapt and update skills. On-line
    instruction has grown rapidly in the last 10
    years as it has gained mainstream acceptance due
    to increasing internet access and innovations in
    instructional technologies.

http//www.uillinois.edu/president/strategicplan/
Page 26
27
Environmental AssessmentEconomy Budget
  • The economic value of higher education to the
    individual especially those with
    post-baccalaureate degrees continues to grow.
  • The U.S. economy will continue to grow, but at a
    slower rate. Health care costs continue to grow
    at a more rapid rate than general inflation and
    earnings which has an impact on both the national
    economy and governmental spending at all levels.
  • The states fiscal situation, while somewhat
    improved, faces continued challenges in the
    coming years. Health care and pension obligation
    costs are expected to continue rising rapidly and
    will likely outpace any state revenue growth
    realized resulting in continued constraints on
    discretionary spending in the state budget
    (e.g., higher education).
  • The state has greatly increased its debt burden
    in the last four years creating a reluctance
    among state policymakers to fund additional
    capital improvements. At the same time, the
    University must increasingly rely on internal
    sources for funding capital projects which in
    turn has contributed to increased debt service
    levels.
  • The University has become more reliant on
    multiple revenue streams and state policymakers
    may interpret this trend as meaning the
    University can more easily absorb reductions or
    at least flat funding in the general
    appropriation.

http//www.uillinois.edu/president/strategicplan/
Page 27
28
Environmental AssessmentResearch, Technology,
Econ. Development
  • Federal RD spending has slowed significantly in
    recent years and this pattern is likely to
    continue in the near term due to the slowing
    economy and other significant pressures on the
    federal budget (e.g., defense, homeland
    security).
  • The bedrock of economic development through
    research and technology commercialization are top
    quality science and engineering faculty and
    students. Intense competition for science and
    faculty and students nationally and
    internationally coupled with stagnant state and
    federal funding will create serious challenges
    for major research institutions such at the
    University of Illinois as they attempt to
    maintain and enhance the quality and
    competitiveness of their research programs and
    technology commercialization endeavors.
  • Land grant and other major research universities
    are increasingly expected to have technology
    transfer as a key part of their overall economic
    development mission. The Universitys efforts in
    this area have grown considerably in recent years
    although many technical and competitive
    opportunities (and challenges) remain.
  • Global interest in renewable energy sources will
    continue to grow in the future due to the overall
    increase in demand and continued concerns about
    the cost and supply of fossil fuels and other
    traditional energy sources. The University has
    an opportunity to take a leadership role in
    energy research and development given its
    proximity to traditional (e.g., coal, nuclear)
    and renewable (e.g., biomass, wind) energy
    sources and its fundamental strengths in science
    and engineering disciplines.

http//www.uillinois.edu/president/strategicplan/
Page 28
29
Environmental AssessmentPolitical Landscape
  • Higher education issues have traditionally been
    state concerns, but Congress also has become much
    more interested in issues related to higher
    educations affordability and public
    accountability.
  • Growing public concern over affordability and
    recent legislation (e.g., Truth in Tuition)
    will make major increases in tuition challenging
    to achieve.
  • Congress is also interested in an array of issues
    concerned with Homeland Security, which will have
    implications for privacy and student issues.
  • The P-16 education continuum has been truncated
    in the minds of many state policymakers and no
    longer includes higher education there is,
    however, a significant focus on issues related to
    K-12 education and its financing.
  • While the University enjoys a broad base of
    support within the General Assembly, the
    dominance of other issues facing the state
    legislature (e.g., health care, pensions, K-12
    education) make it difficult to advance the
    Universitys (or higher educations) interests.
  • There is growing interest at both the state and
    national levels in creating complex data systems
    that would provide policy makers and the general
    public with detailed information on student
    progress through the P-16 educational pipeline
    and beyond to the work place.

http//www.uillinois.edu/president/strategicplan/
Page 29
30
U of I Mandates
  • Federal and State statutes that relate to
    creation and mission of the University of
    Illinois
  • Created as a Land Grant institution Morrill Act
    of 1862
  • University of Illinois Act created the University
    of Illinois and established the Board of
    Trustees the Trustees Act sets forth powers,
    responsibilities, and membership of the Board
    1867 and 1873
  • U of I Agricultural Experiment Station created by
    Hatch Act of 1887
  • Board of Trustees w/ support of Illinois General
    Assembly created the Engineering Experiment
    Station in 1903
  • Cooperative Extension created by Smith Lever Act
    in 1914
  • Illinois Senate passed S.R. 296 establishing
    economic development as fourth mission of the U
    of I (in addition to teaching, research, and
    service) in 2000
  • UIC, UIS statutes
  • U of I Hospital Act

Key Point U of I Act and U of I Trustees Act
created the University and established its
mission.
http//www.uillinois.edu/president/strategicplan/
Page 30
31
U of I Mandates (Continued)
  • Legal requirements that pertain to State of
    Illinois entities including State universities
  • State Universities Civil Service Act
  • University of Illinois Revenue Bond Financing Act
    for Auxiliary Facilities
  • University of Illinois Revenue Bond Act
  • Illinois Educational Labor Relations Act
  • Legislative Audit Commission University
    Guidelines
  • Open Meetings Act
  • Freedom of Information Act
  • Governmental Ethics Act
  • State Officials and Employees Ethics Act
  • State Auditing Act
  • Illinois Procurement Code
  • Architectural, Engineering, and Land Surveying
    Qualifications Based Selection Act
  • State Property Control Act

Key Point As a State entity, the University is
subject to regulations/oversight by the State of
Illinois and must abide by the State Constitution
and State statutes.
http//www.uillinois.edu/president/strategicplan/
Page 31
32
U of I Mandates (Continued)
  • Summary of U of I and Trustees Act provisions
    establishing our mission
  • Teaching identifies courses of instruction
  • agriculture and the mechanic arts, and military
    tactics, without excluding other scientific and
    classical studies (110 ILCS 305/7)
  • shall offer instruction in such branches of
    learning as are related to agriculture and the
    mechanic arts, and as are adapted to promote a
    liberal and practical education in the several
    pursuits and professions of life, without
    excluding other scientific and classical studies,
    and including military tactics (110 ILCS 310/6)
  • Research
  • support scientific research and development
    (110 ILCS 305/7)
  • Service (cooperative extension service)
  • Economic development (110 ILCS 305/7)
  • manage medical research and high technology
    parks
  • encourage the improvement and development of the
    States economy.
  • Hospital (110 ILCS 330)

http//www.uillinois.edu/president/strategicplan/
Page 32
33
  • Strategic Planning at the U of I
  • Process, Timeline, and Highlights

Page 33
34
Strategic Planning at the U of I
  • B. Joseph White became President of the
    University in January 2005. Immediately
    thereafter, he initiated a comprehensive
    University-wide strategic planning process.
  • Purpose of Strategic Planning Process Establish
    high aspirations, set priorities, and provide
    leadership to achieve goals over a 10 year
    horizon

Page 34
35
U of I Strategic Planning Process
Stage 1
Completed
  • University of Illinois Strategic Planning
    Framework
  • University of Illinois at Chicago
  • University of Illinois at Springfield
  • University of Illinois at Urbana-Champaign
  • University Administration
  • U of I Alumni Association
  • University of Illinois Foundation
  • Schools, Colleges, and Major Administrative Units

Stage 2
Completed
Support Organizations
Stage 3
Completed
http//www.uillinois.edu/president/strategicplan/
Page 35
36
U of I Strategic Planning Timeline
Stage 2 Strategic Plans University Campuses
and Support Organizations (UA, UIAA, UIF)
Stage 3 Strategic Plans Schools, Colleges, and
Major Administrative Units
Page 36
37
Stage 1 Strategic Plan HighlightsBackground
  • The University of Illinois is
  • One university with three campuses sharing a
    common name, mission, governing body, and
    unwavering commitment to academic excellence
  • An organization that is
  • Academically decentralized
  • Financially centralized

Page 37
38
Stage 1 Strategic Plan HighlightsU of I Mission
  • The University of Illinois will transform lives
    and serve society by educating, creating
    knowledge, and putting knowledge to work on a
    large scale and with excellence

Page 38
39
Stage 1 Strategic Plan HighlightsU of I Vision
  • To create a brilliant future for the University
    of Illinois in which the students, faculty, and
    staff thrive and the citizens of Illinois, the
    nation, and world benefit, a future in which the
    University is the recognized leader among public
    research universities in
  • Teaching, scholarship, and research
  • Engagement and public service
  • Economic development
  • Arts and culture
  • Global reach
  • Athletics

Page 39
40
Stage 1 Strategic Plan HighlightsU of I
Strategic Intent
  • Build the leading 21st century public university
    system.

Page 40
41
Stage 1 Strategic Plan HighlightsU of I
Strategic Goals
  • Strategic Goal 1 The University of Illinois
    will achieve and be recognized for both academic
    excellence and extraordinary education and
    development of our students.
  • Strategic Goal 2 The University of Illinois
    will be the recognized higher education leader in
    innovation, quality, and service.
  • Strategic Goal 3 The priorities of the
    University of Illinois will reflect the most
    urgent needs of the state, our communities, and
    the world.
  • Strategic Goal 4 The University of Illinois
    will have the resources (people, money, and
    facilities) required for excellence.

Page 41
42
Stage 2 Strategic Plan HighlightsFive Key
Priorities
  • Five key priorities emerged from the stage 2
    strategic plans
  • Develop UIUC into the nations preeminent public
    research university.
  • Develop UIC into the nations premier urban
    public research university.
  • Position the U of I Medical Center and health
    sciences colleges for the next quarter century.
  • Develop UIS into one of the nations top five
    small public liberal arts universities.
  • Successfully launch the Global Campus to offer a
    high quality, highly affordable and accessible U
    of I education to tens of thousands of
    Illinoisans and others unable to spend an
    extended period of time on one of our campuses.
  • Realizing these priorities will be dependent upon
    the effective execution of strategies at all
    levels of the University. In December 2006 a
    working group was established to develop a
    reporting approach encompassing key indicators of
    progress and achievement for each of the five key
    priorities.

Page 42
43
Stage 3 Strategic Plan HighlightsKey Challenges
  • Organizational Challenge Each campus has a
    unique range of academic and administrative units
    at different levels of organizational development
    and with different sets of competitors
  • How does each campus build a sustainable
    competitive advantage through the plans developed
    by these units?
  • Fundamental Questions in Stage 3 Planning Efforts
  • How do we make great colleges and programs even
    better?
  • How do we advance good colleges and programs to
    greatness?

Page 43
44
Stage 3 Strategic Plan HighlightsScope
  • University of Illinois at Urbana-Champaign
  • 19 Academic Units
  • 7 Administrative Units
  • University of Illinois at Chicago
  • 16 Academic Units
  • 8 Administrative Units
  • University of Illinois at Springfield
  • 6 Academic Units
  • 3 Administrative Units

Page 44
45
Stage 3 Strategic Plan HighlightsMaking Great
Colleges Even Better
  • UIUC College of Business
  • Undergraduate Programs Build excellence by
    attracting a high-achieving and diverse student
    population through proactive and personalized
    recruitment practices, offering innovative Honors
    programs and international experiences, and
    providing smaller and more intimate classroom
    environments
  • UIUC Colleges of ACES, Applied Health Sciences,
    Engineering, Fine and Applied Arts, Liberal Arts
    and Sciences, GSLIS, Medicine and Social Work
    Beckman Institute and NCSA
  • Illinois Informatics Initiative Invent the
    information environments of the future and
    educate those who will build and use them
  • UIC College of Nursing
  • Collaborative for Learning Excellence Link
    scholarly excellence to healthcare and workforce
    development
  • Institute for Healthcare Innovation Translate
    innovation to practice

Page 45
46
Stage 3 Strategic Plan HighlightsMoving from
Good to Great
  • UIC College of Liberal Arts and Sciences
  • Retain, Restore, and Renew
  • Build on traditional pockets of excellence plus
    other under-valued strengths
  • Take advantage of opportunities for growth in
    interdisciplinary areas
  • Stem and reverse erosion of facilities and
    faculty
  • UIS College of Liberal Arts and Sciences
  • Create a Master Plan for the Arts Address both
    gaps in the curriculum and the construction of
    state-of-the-art facilities

Page 46
47
Stage 3 Strategic Plan HighlightsSuccess
Factors for Achieving Greatness
  • The following themes recur throughout stage 3
    plans at all campuses or are represented in many
    of the plans of a specific campus as success
    factors for achieving greatness
  • Enhance faculty and staff salary competitiveness 
    (All campuses)
  • Approach emerging opportunities with innovative,
    high-impact research that will advance education,
    improve health, accelerate the creation of
    knowledge through informatics, and address energy
    and sustainability (UIUC)
  • Create new knowledge at the interfaces and
    overlaps of disciplines and translate discovery
    to application (UIUC and UIC)
  • Engage with the people, communities, and
    institutions of Chicago and other great cities of
    the world in ways that transform lives (UIC)
  • Implement programs, projects, and activities that
    engage the local and regional communities, while
    having national and international impact (UIS)
  • Enhance global experiences and perspectives in
    the curriculum (All campuses)
  • Seek new revenue streams and increase operational
    efficiency to ensure that the necessary resources
    are available for execution and goal achievement
    (All campuses)

Page 47
48
  • Ensuring Plan Execution at the
  • University of Illinois

Page 48
49
Strategic Plan Development Execution FY06 to
FY08 (and Beyond)
FY 2006
FY 2007
FY 2008
Timeline
SP Development
Execution
Execution
Process
  • Allocate Resources
  • FY 2008 Annual Budget Allocation
  • FY 2009 Budget Request
  • Allocate Resources
  • FY 2007 Annual Budget Allocation
  • FY 2008 Budget Request
  • Track Performance
  • Develop Stage 1, 2, 3 strategic plans

U of I Specific Initiatives / Actions
Progress Report
  • Make Annual Report to BOT and the University
    community

Execution and Progress Reporting will be an
ongoing part of the strategic plan implementation
process
Page 49
50
FY08 BOT Operating Budget Request
  • Strengthen Academic Quality 70.1 M
  • 1) Campus Strategic Initiatives 28.8 M
  • UIC 13.0 M
  • UIS 1.9 M
  • UIUC 13.9 M
  • 2) Competitive compensation 41.3 M
  • (4 merit, 0.5 compression/recruit/retain)
  • Address Facility Operations Needs 6.3 M
  • Meet Inflationary and Other Cost Increases 24.6
    M
  • Total 101.0 M

Page 50
51
Resource Scenario - Uses of FundsFY08 to FY12
Page 51
52
Resource Scenario - Sources of FundsFY08 to FY12
Page 52
53
Reporting Approach - Guiding Principles
  • Guiding Principles for Measuring and Ensuring
    Progress
  • The reporting approach will be comprised of key
    indicators of progress and achievement (both
    quantitative and qualitative) for each of the
    five priorities.
  • The reporting approach will also include relevant
    contextual information to promote appropriate
    interpretation of these indicators.
  • The reporting approach will be a macro-level tool
    for demonstrating accountability to the BOT and
    other stakeholders on an annual basis regarding
    progress and achievement in each of the five
    areas. As such, this approach will complement
    (not supplant) other, more detailed management
    reporting systems under development at campuses
    to support and inform strategy execution at the
    school, college, and department level.
  • The process for developing and implementing the
    reporting approach and related metrics will be
    highly collaborative and transparent.
  • The metrics established to demonstrate progress
    and achievement in addressing the five priorities
    will be results-focused and limited in number
    while at the same time seeking to provide a
    balanced picture of the context within which
    strategy execution occurs.
  • The metrics will be based on well-established
    data and other information sources where possible
    to maximize credibility and minimize additional
    workload.
  • The metrics will reflect industry norms and
    standards where feasible in order to enable
    benchmarking and peer comparisons.
  • First progress report in July 2007.

Page 53
54
Reporting Approach - Working Group
  • UIC
  • Russell Betts, Vice Provost for Planning and
    Programs
  • Robert Mrtek, Professor of Medical Education
  • Al Pate, Executive Assistant to the CEO,
    Healthcare System
  • UIS
  • Harry Berman, Provost
  • Marya Leatherwood, Associate Vice Chancellor and
    Director of Enrollment Management
  • Ed Wojcicki, Associate Chancellor for Constituent
    Relations
  • UIUC
  • Dick Wheeler, Dean, Graduate College Vice
    Provost for Strategic Initiatives
  • Martha Gillette, Head of Biological Sciences
  • Bruce Vojak, Associate Dean for External Affairs,
    College of Engineering
  • University Administration
  • Doug Vinzant, Associate Vice President for
    Planning and Budgeting
  • Dan Layzell, Assistant Vice President for
    Strategic Planning and Policy Analysis
  • Tyler Kearney, Resource and Policy Analyst

Page 54
55
  • Day 1 Wrap Up

Page 55
56
Review of Workshop Goals
  • Develop understanding of strategic planning and
    management concepts, terms, and processes, and
    their application at the University of Illinois
    (Day 1)
  • Develop understanding of budgeting/resource
    allocation concepts, terms, processes, and trends
    at the University of Illinois (Day 2)
  • Discuss mechanisms for creating stronger linkages
    between planning and budgeting at the University
    of Illinois (Days 1 2)

Page 56
57
References
  • American Marketing Association
    (http//www.marketingpower.com/mg-dictionary-view3
    602.php?)
  • Bryson, John M. Strategic Planning for Public
    and Nonprofit Organizations 3rd Edition.
  • University of Illinois Strategic Plan Website
    (http//www.uillinois.edu/president/strategicplan/
    )

Page 57
58
University of IllinoisBudget Process, Trends and
Outlook
February 2, 2007
Page 58
59
Day 2 Overview
  • Demographics
  • Trends in State of Illinois Operating Budget
  • University of Illinois Operating Budget
  • Tuition and Affordability
  • Federal and Research at the U of I
  • Priority Setting Exercise
  • Budgeting Basics
  • Changes in Public University Funding Model
  • FY 2008 Budget Outlook

Page 59
60
I. Demographics
Page 60
61
Two Budget Monsters Holding Hands in the Closet
Health Care
Aging
Page 61
62
Life Expectancy
Sources Bureau of Census, Social Security Admin
Reports and Congressional Reports.
Page 62
63
Health Care Spending of GDP 2003
Page 63
64
Health Care Spending of GDP in the USA1975 -
2020
Page 64
65
Increase in Health Insurance PremiumsCompared to
Other Indicators, 1988-2006
Page 65
66
Example Compounding Effect of HealthCare Cost
Increases
Page 66
67
Other Monsters
  • Federal Deficit
  • State Debt
  • OASDI Social Security
  • Illinois Pension Systems
  • Changes in Economy

Page 67
68
U.S. Federal Deficit Adding 1.61 Billion per
day Approx. 29,000 per American
Gross Deficit in Trillions
Page 68
69
State of IllinoisState-Supported Principal
OutstandingEnd-of-Year FY 1996-2007 (Dollars in
Billions)
27.010
26.988
26.626
26.019
25.051
12.697
11.361
10.314
9.200
9.004
8.888
9.192
CGFA EstimateSources Governors Office of
Management and Budget, MPEA, ISFA, and RTA.
Page 69
70
Cumulative OASDI Income Less Cost,Based on
Present Law Tax Ratesand Scheduled Benefits
Page 70
71
State Funded Retirement SystemsProjected
ContributionsFY 2006 FY 2045 (Dollars in
Billions)
Fiscal Year
Page 71
72
Pension Reforms Mirror 1995 Plans
StructureState Owes Approx. 38 Billion to
Pension Systems
Page 72
73
Relative Labor Costs Among MajorAuto-Producing
Nations(in dollars per hour)
33.00
22.50
22.10
20.20
19.40
18.60
8.40
5.20
2.70
0.90
Source U.S. Office of Trade and Economic
Analysis, Roland Berger Strategy Consultants, WSJ
6/10/04.
Page 73
74
Relative Illinois Economic PerformanceIllinois
Per Capita Personal Income as of US1995 to 2005
Page 74
75
More Bad News Comes Everyday
Page 75
76
II. Trends in State of Illinois Operating Budget
Page 76
77
State of IllinoisGeneral Fund Appropriations
FY 2007
State By Sector
Sources of General Revenue Fund
25.7 Billion
Source Illinois State Budget, FY 2007 as
introduced.
Page 77
78
State of IllinoisGeneral Fund Appropriations
FY 2007
Higher EducationBy Sector
StateBy Sector
25.7 Billion
2.2 Billion
Sources Illinois State Budget, FY 2007 as
introduced, Higher Education final budget.
Note For Higher Education by sector, the Health
Insurance redirection of 45 million has been
moved from Public Universities to All Other.
Page 78
79
State Tax AppropriationChanges by Agency
Page 79
80
Cumulative Change in State Tax Appropriationby
Higher Education Sector
Page 80
81
State Tax AppropriationChanges by Agency
Page 81
82
III. University of IllinoisOperating Budget
Page 82
83
University of IllinoisBudget by Source of Funds
FY 1980
FY 2007
641.7 Million
3,691.2 Million
Page 83
84
University of IllinoisShare of State Tax
Appropriations
Page 84
85
University of IllinoisState Tax Support as a
Percent of Budget
Page 85
86
University of IllinoisGRF/EAF Appropriations for
FY 1998 FY 2007(Dollars in Thousands)
Page 86
87
DIRECT STATE TAX APPROPRIATIONS (GRF/EAF)FY 1990
FY 200 (Dollars in millions)
Page 87
88
STATE TAX APPROPRIATIONS PER STUDENT FTEFY 1990
FY 2007 (Dollars in millions)
Page 88
89
GRF Income Fund(Dollars in Millions)
In Constant FY 2006 Dollars (CPI)
FY02-07 GRF Adjusted for Health Insurance and
Rescissions.
Page 89
90
GRF Benefits (Dollars in Millions)
In Constant FY 2006 Dollars (CPI)
FY02-07 GRF Adjusted for Health Insurance and
Rescissions. Benefits includes the Health
Insurance payment.
FY04 benefits excludes one time pension bond
proceeds.
Page 90
91
INCOME FUND STATE TAX APPROPRIATIONPER STUDENT
FTE FY 1990 FY 2007(Dollars in millions)
Page 91
92
INCOME FUND STATE TAX APPROPRIATION PER FTEFY
1990 FY 2007(Dollars in millions)
Page 92
93
State Tuition Pay for Instructional
FunctionExpenditures by Function FY 2005
Page 93
94
University of IllinoisTotal Debt by Type
Dollars in Millions
1,322.2
1,202.2
1,131.0
1,098.7
1,018.1
803.1
692.4
422.2
387.0
385.5
Page 94
95
Big Ten University and Foundation EndowmentsFY
2006(Dollars in Billions)
Source NACUBO Endowment Study FY 2006.
Page 95
96
Total Endowment-Equivalent Adjusted for Student
FTE EnrollmentUniversities with more than 20M
in Federal Research in Rank Order(from Lombardi
Report 2002)
Page 96
97
2004 Adjusted Total Endowment-EquivalentBased on
The Centers Methodology UIUC Peer
Institutions(Dollars in Billons)
Page 97
98
2004 Adjusted Total Endowment-EquivalentBased on
The Centers Methodology UIC IBHE Peer
Institutions(Dollars in Billons)
Page 98
99
IV. Tuition and Affordability
Page 99
100
University of Illinois Maximum Award vs. Tuition
and Fee Rates
UIUC Engineering
UIC Engineering
UIUC
8,877
UIC
UIS
MAP
Note UIS excludes 300 Capital Scholar
instruction fee. Entering Freshmen Guarantee
Tuition rate.
Page 100
101
Need Based Student Aid as Percent of theState
Higher Education Budget FY 2005
Page 101
102
Guaranteed Tuition Program(UIUC Example)
Page 102
103
Guaranteed Tuition ProgramTruth In Tuition
  • Illinois legislation to provide predictability
    for college education costs to parents.
  • Provides an incentive to graduate in 4 years.
  • Affects undergraduate programs only.
  • Tuition rate for program set for 4 years for each
    in-coming cohort.
  • Does not include fees or room and board.

Page 103
104
Tuition Fee Sticker ComparisonsGeneral Student
By Cohort (FY 2005)
FY 2008 Tuition projections assumes 6.0
increases for Michigan and Minnesota.
Page 104
105
INCOME FUND PER STUDENT FTEFY 1990 FY
2007(Dollars in millions)
Page 105
106
INCOME FUND AND STATE TAX APPROPRIATION PER
FTEFY 1990 FY 2007(Dollars in millions)
Page 106
107
University of IllinoisAverage Compounded Annual
Increases FY 1990 FY 2007
CPI Consumer Price Index, BLS Tuition Average
of Lower and Upper Division
Page 107
108
University of IllinoisMAP Supplemental Financial
Aid Expenditures FY 2000 - FY 2007
Dollars in Millions
27.2M
21.2M
17.6M
16.2M
13.9M
2.2M
792K
623K
FY 2007 Budget, does not include AFMFA Aid.
Page 108
109
University of IllinoisHalf the Full-time
Undergraduate Students Pay Lessthan Sticker
Price Fall 2005
Page 109
110
University of Illinois at Urbana-ChampaignFinanci
al Aid and Educational Costs by QuintileIllinois
Mean Income by QuintileEstimated from Fall 2002
DataDependent Undergraduate Students that
Applied for Financial Aid for FY 2003
  • 2 Parent Income Ranges Parent income was used
    for dependent student tables.
  • 3 Federal and State Gift Aid Includes all
    Federal and State grants, scholarships, and
    waivers, including PELL and MAP.
  • 4 Inst. and Private Gift Aid Includes all inst.
    and private grants, scholarships, waivers, and
    fellowships, including SEAL and UIUC Tuition
    Grant
  • 5 Source Census Bureau

Page 110
111
Example Illinois vs. NorthwesternPell MAP
Maximum AwardProvide Full Tuition Fees
33,567
Northwestern
UIUC
69.3
9,882
9,018
PELL MAP
MAP Monetary Award Program, Illinois Need Based
Financial Aid
Page 111
112
College Financial Aid
Program Eligibility by Income(Assumes a family
of four, one in college)
34,000
52,000

PELL/SEOG
Full
Partial
44,000
63,000

MAP
Partial
Full

44,000
63,000
U of I MAP Supplemental Aid
Partial
Full
66,000

Work study
Federal Loans (Subsidized for incomes below
80,000, unsubsidized no income limits)
Merit/Talent Based Scholarships/Waivers All
Incomes
130,000
Federal Tax 3,000 Deduction
130,000
Federal Deductibility of Student Loan Interest up
to 130,000
Education IRA No Income Limit (No taxation on
Capital Gains, 2,000 addition per year)
Page 112
113
University of IllinoisExample of Net Tuition
Payments
Page 113
114
University of IllinoisExample of Net Tuition
PaymentsAssumes Family of 4, one in college
Page 114
115
University of IllinoisExample of Net Tuition
PaymentsModerate Family Income (80,000 in FY
2005)
Page 115
116
University of IllinoisExample of Net Tuition
PaymentsHigh Family Income (120,000 in FY 2005)
Page 116
117
V. Federal and Research at U of I
Page 117
118
Total R D Expenditures FY 2004(Dollars in
Millions)
Page 118
119
UIC Total Federal Obligations(Dollars in
Thousands)
Page 119
120
UIUC Total Federal Obligations(Dollars in
Thousands)
Page 120
121
U of I Total Federal Obligations(Dollars in
Thousands)
Page 121
122
FEDERAL GRANT AND CONTRACTEXPENDITURES BY
AGENCYTOTAL UNIVERSITY - FY 2003
519.4 Million
Health and Human Services and the National
Science Foundation represented almost 65 of the
total federal grant and contract expenditures in
FY 2003.
Source UFAS
Page 122
123
FEDERAL GRANT AND CONTRACTEXPENDITURES BY
FUNCTIONTOTAL UNIVERSITY - FY 2003
Page 123
124
VI. Priority Setting Exercise
Page 124
125
VII. Budgeting Basics
Page 125
126
Major Approaches to Budgeting
  • Incremental Budgeting
  • Zero Based Budgeting
  • Planning, Programmatic and Budgeting Systems
  • Performance Based Budgeting
  • Formula Budgeting
  • Responsibility Center Budgeting
  • Initiative Based Budgeting

Page 126
127
Essential Questions in Public Budgeting
  • Who gets how much?
  • Who pays?
  • On what basis shall it be decided to allocate x
    dollars to activity A instead of activity B?
    (Key 1940)
  • A budget is a financial and political plan
    comprised of expenditures and the means of
    funding them (i.e., taxes, other sources of
    revenue, and borrowed funds).

Page 127
128
Revenue, Stakeholders, Accountability
Page 128
129
University of Illinois
Page 129
130
State Operating Budget Key Dates
  • Spring - U of I Budget request developed
  • July - BOT reviews preliminary budget request
  • September - BOT approves U of I budget request
  • December or January- IBHE recommendations
    submitted to the
    Governor
  • February - Governors budget recommendations
    submitted to the Legislature
  • May/June - Legislature acts
  • June/July - Governor signs appropriation bill

Page 130
131
TIMETABLE FOR OPERATING BUDGET REQUEST
DEVELOPMENT AT THE UNIVERSITY OF ILLINOIS FY 2008
Budget Shown
Page 131
132
VIII. Changes in Public University Funding Model
Page 132
133
Public University Funding
Page 133
134
At the same time the State has reduced public
universities share of the budget, the value of
the college experience has increased dramatically
Page 134
135
The Lifetime Expected Value of a
BachelorsDegree is Rising Compared to a High
School Diploma(in constant dollars)
Dollars in Millions
Source Bureau of the Census
Page 135
136
New Models
  • Increase State Support?
  • Increase Tuition Revenue
  • Increase Aid?
  • Growth by Substitution
  • Growth of Endowment
  • Reduce Size of Missions
  • Resize Enrollments of the Institution
  • Other

Page 136
137
IX. FY 2008 Budget Outlook
Page 137
138
FY 2008 Operating Budget
  • Unavoidables
  • Legal
  • Medicare
  • Workers Compensation
  • Major Utility Issues
  • Facility Renovation
  • Faculty Salaries
  • Strategic Planning Initiatives

Page 138
139
Estimated FY 2008 Additional Costs(Dollars in
Millions)
Illinois State Level Costs Retirement Systems,
Employee Health Benefits, Medicaid,
Elementary/Secondary Education and ISAC funding.
University of Illinois Costs
  • Salary Increases (3) 27.60
  • OM New Areas 1.30
  • Utility Price Increase 13.00
  • Insurance/Liability/WC 1.40
  • Deferred Maintenance 1.00
  • 45.10

Page 139
140
FY 2006 Faculty SalaryCompetitive Standing among
PeersUIC, UIS and UIUC
Page 140
141
Research I UniversitiesGap between UIC, UIUC and
Private InstitutionFull-Time Instructional
Faculty Average Salaries
Page 141
142
FTE On-Campus Enrollment per FTE Tenure-System
Faculty Fall 1983 to 2006
Students per Faculty
Fall
Page 142
143
Institutional Support
  • The scope of activities included in Institutional
    Support is defined by the Department of
    Educations National Center for Education
    Statistics in their annual Institutional
    Post-Secondary Education Data System Survey.
    This definition is also widely used by NACUBO.
  • Institutional support is the surrogate for
    institutional overhead in academic institutions
    it includes expenditures for general
    administrative services, executive direction and
    planning, legal and fiscal operations, public
    relations/development and unavoidable costs such
    as medicare, workers compensation, public safety
    and environmental health and safety activities.

Page 143
144
University of IllinoisInstitutional Support as
a of Total Expenditures
Page 144
145
Big Ten Universities Total Systems Institutional
Support as a of Total Expenditures FY 2005
Note Total Expenditures are Operating
Expenditures less Depreciation Source FY 2005
Annual Financial Reports
Page 145
146
Recent Capital Budget Strategies
  • Multiple Missions Multiple Sources
  • Regular Capital (e.g. UIS classroom/office)
  • Economic Development Funding (e.g. IGB MRI)
  • Special State Initiative (e.g. College of
    Medicine)
  • Private Gifts (e.g. Siebel Center)
  • Federal Funds (e.g. UIC Structural Biology)
  • Internal Funds (e.g. OCC Utilities)
  • Auxiliary Funds (e.g. Recreation Centers)
  • Operating Budget (e.g. Deferred Maintenance)

Page 146
147
Capital Appropriations History All Higher
EducationFY 1981 to FY 2007(Dollars in Millions)
Fiscal Year
Page 147
148
U of I Capital AppropriationsFY 1995 to FY
2007(Dollars in Millions)
165.9
140.1
80.7
46.8
41.8
30.5
27.8
21.1
12.7
0.0
0.0
0.0
0.0
Page 148
149
FY 2008 Capital Budget PlanningStrategic Issues
  • Impact of no capital for FY 2005, FY 2006 and
    FY 2007
  • Uncertainty for upcoming five-year period
  • Continue to target special needs (economic
    development health care)
  • For the higher education budget submission
  • Identify our total needs
  • Target renovation/stewardship
  • Recognize reality but dont permit reduced
    request to become a self-fulfilling prophecy
  • Continue approach to match private gifts
  • Ongoing assessment of debt capacity

Page 149
150
University of IllinoisPreliminary Capital
Priority Request FY 2008(Dollars in Thousands)
Separate initiatives for economic development
and Illinois Bill of Health will continue.
Page 150
151
"Expecting the world to treat you fairly because
you are good is like expecting the bull not to
charge because you are a vegetarian." Dennis
Wholey (1937-)
Page 151
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