Resources

Response to Continued Recycling Requirement
Targets for Strategic Investment
Creating a Safer and More Secure University Key Initiative
Improvements to F&B Information Technology Capabilities
Fostering Diversity Key Initiative
Environmental Stewardship Key Initiative
Investments to Improve Accountability, Respond to Regulatory Requirements, Improve Financial Reporting Capability
Major University-Wide Resource Enhancements

Financial resources are critical to the continued success of F&B, as well as to the achievement of the key initiatives identified in this plan. As noted previously, F&B is a lean organization that, like the rest of the University, has had to absorb a regular general funds budget-recycling requirement, which has impacted our ability to meet the many demands placed upon us by our customers. While this has driven us to be extremely efficient, there is concern that additional cuts could impact service delivery.

Response to Continued Recycling Requirement

Historically, F&B has met the University's budget recycling target by applying the 1 percent reduction across all units. While some exceptions have been made, units have had to identify their pro rata contribution that allows this target to be achieved. The F&B Leadership Team agrees that continuing with this approach will be very difficult. However, no obvious alternatives have emerged. For the first year of the plan, FY2008-09, F&B will once again assess each unit 1 percent in order to meet the division's required give-back (which totals approximately $702,000).

During the course of FY2008-09, F&B leadership will push on a number of fronts in the hopes that more systematic opportunities for cost reductions may be identified. These activities will include:

• Through the Providing Great Service Key Initiative, each unit will complete a peer review that will be designed to assess the quality of services being provided. Findings from the reviews may enable identification of possible efficiency gains.
• Each unit will be required to review its major processes, and the leadership team will review crosscutting activities for re-engineering opportunities.
• The Information Technology Key Initiative will review the current organization of systems and hardware configurations and support, searching for service improvements along with opportunities to consolidate resources for a more cost-effective structure.

Following these activities, and others that may be identified during the year, it is expected that a more coordinated approach will be taken to meet F&B's budgetary recycling commitment in FY2009-10, and future years.

Targets for Strategic Investment

In response to the Provost's charge of our strategic plan, the F&B Leadership team collected input from each unit and new key initiative team to assemble our priorities for new investment during the planning period. For informational purposes, a return of 0.5 percent of our general funds budget would be approximately $351,000, 1 percent would be $702,000, and 5 percent would be $3.5 million. F&B will seek investment funding for the priorities and initiatives that follow.

Creating a Safer and More Secure University Key Initiative

This new key initiative, which focuses on safety and security at all of our campuses, is our top funding priority. It is imperative that we make a sustained effort at improving our abilities to respond effectively to problematic events, that the campus community be well trained on the importance of such issues, and that the various units responsible are adequately resourced to deal with the more complex challenges of the current world. This has been seeded by an investment in the Environmental Health and Safety Office in FY2007-08. Permanent and temporary funding would be directed toward:

• Multi-tiered EMS program - University Police
• Three additional University Police officers
• Additional leased police vehicles
• Implementation of motorcycle police capability
• Occupational medicine enhancement

• Key initiative support, annually for five years
• Access control
• Enhanced video/closed-circuit TV monitoring capability
• HAZMAT vehicle chassis replacement

Improvements to F&B Information Technology Capabilities

We anticipate that through the leadership of the Information Technology Key Initiative Team, investments in our systems, infrastructure, and the talent that manages these resources will be a significant focus. We also expect that our focus on these activities will yield the opportunity for resource reallocation for more effective coverage of these needs.

• Internal Audit IT upgrades
• University Police IT specialist
• Budget Office IT specialist
• Human Resources IT web and infrastructure enhancement
• Five additional Controller's Office
• IT specialists
• Permanent and Temporary Funding
• Implement PDA capability in OPP for efficiency enhancement
• OPP systems enhancements/upgrades
• Equipment upgrades in Multimedia & Print Center

Fostering Diversity Key Initiative

This continuing key initiative will focus on delivering measurable results, and on creating new ideas for developing pools of potential candidates. The new investments will jumpstart these activities and help to operationalize gains made to date.

• Special assistant to the vice president for F&B - Diversity
• Minority Business Enterprise/Women Business Enterprise program support - Procurement Services

• Human Resources recruiting enhancements/focus on diversity sourcing and hiring (Permanent and temporary funding)
• Additional key initiative team support
• Strategic hiring pool

Environmental Stewardship Key Initiative

In the last plan, $1.2 million of annual funding was committed to this set of initiatives. As the key initiative team has made progress, more opportunities have emerged. Additional funding will enable broader and more substantial success to be achieved in the important area of sustainability.

• Additional annual funding for environmental initiatives
• Director, sustainability initiatives (New position)
• Enhance building commissioning capability
• Environmental Purchasing Specialist – Procurement Services

• Additional funding for energy-saving capital projects (Guaranteed Energy Savings Program)
• Electric vehicle charging stations

Investments to Improve Accountability, Respond to Regulatory Requirements, Improve Financial Reporting Capability

Many of the units within F&B have been impacted by growing requirements for regulatory compliance, transparency, and accountability. While compliance and accountability are central goals in all of our processes, the increasing burden of these requirements, often imposed by outside entities, are taxing many of the affected organizations. Investments in this category will assist in enabling greater accountability with appropriate levels of resources. All of the following investment areas would require permanent funding.

• Three managerial/supervisory position additions - Controller's Office
• Five financial analyst/accountant position additions - Controller's Office
• Additional administrative assistant - Controller's Office
• Human Resources/Finance specialist - University Police
• Additional Human Resources representative position to support Controller's Office
• Administrative support for Human Resources Representative office - Human Resources
• Additional budget support for Internal Audit
• Budget Office position enhancements
• Additional Senior Travel Coordinator - Procurement Services

Major University-Wide Resource Enhancements

F&B provides a number of critical services on behalf of the entire University. The significant resource requests that follow do not directly benefit the unit forwarding the idea. However, these activities are important and would have a broad and positive impact on Penn State. The specific items relate to either human resource or facility initiatives.

• Establish permanent funding for University-wide wellness programs ($560,000 annually). Funding of wellness initiatives is currently being done on a year-by-year basis. This would permanently fund a wellness program and allow for longer term planning in this important area.
• Increases to major funding for facilities maintenance funds ($3.0 million increase in permanent funding each of the next five years). This additional investment is directly responsive to the facility condition assessment completed a few years ago that identified serious deferred maintenance needs at Penn State.
• Increase in focused facility investments—classrooms, campus beautification, etc. ($3.5 million over five years). Funding for targeted projects in a variety of specific facility areas could be enhanced with significant benefit to faculty and students.
• Talent management software and succession planning consulting (permanent funding of $150,000 and temporary funding of $200,000). With both expected retirements and a tight labor market, this investment would help the University to more effectively identify and recruit talented individuals to all of its locations.
• Additional HRDC support to enable broader programming and greater access for employees ($941,000 over five years). Additional investment in new programming would provide more training and career development opportunities for University staff.
• Human Resources social networking platform development ($200,000 one-time investment). This investment would aid in developing an infrastructure responsive to the explosion in use of social networking sites as a primary means of communication with a growing number of current and future employees.

It is also important to point out that some major University cost items, managed or overseen by F&B, are expected to continue to exert pressure on our operating budget and squeeze dollars that would otherwise be used for investment. The largest among these expense elements will be:

• Utilities - The cost of electricity, heating, and cooling continue to grow at double-digit rates. With the turmoil in the world's energy markets, it is unclear if and when some moderation in these expense increases will be realized. OPP closely monitors utility cost trends and employs experts to help acquire the required fuels/materials/services at the most advantageous prices while looking to reduce volatility to the extent possible.
• Health insurance - The University continues to project increases of over 10 percent in the premiums necessary to provide high quality health insurance to all of its employees. A number of new strategies—the ten-year agreement with Highmark to provide insurance coverage for all Penn State employees and a variety of wellness initiatives—will hopefully begin to moderate these increases in the near future. However, with healthcare a significant issue in the 2008 presidential election, the political climate may dictate a great deal of what the University sees over the next five years.
• Building maintenance and operations - As we add new buildings, and as we convert buildings into more intensively used facilities, the costs to maintain and operate these important assets continue to grow. OPP continually looks for ways of increasing efficiency and squeezing the most out of its operations dollars.