This month,
Gov. Mitch Daniels implored Indiana’s public college trustees to focus their
efforts on maximizing efficiencies and cutting administrative costs. Instead of
coming to the “Statehouse asking for more money,” as Gov. Daniels said, the
trustees should “stay back at the school and find ways to be more efficient with
those dollars.”
As the president of Indiana’s largest public college, I applaud the governor for acknowledging how critical it is for our trustees to manage costs at a time when our state faces serious budget challenges.
I believe our public colleges and universities have put some recent efforts in place – under the guidance of our trustees – to cut administrative spending.
At Ivy Tech Community College, for example, cost cutting is such a high priority that it is one of the four key strategies articulated in our strategic plan, Accelerating Greatness. And this strategy is more than just a commitment to future administrative efficiencies: it is a reflection of significant cost-cutting efforts put forth to date, which include:
•An agreement with Follett for the management of 27 bookstores throughout the statewide community college system. In addition to reducing administrative costs associated with the operation of our bookstores, this eight-year agreement included a $6 million signing bonus for the college and $1.65 million in renovations to existing facilities.
Improved store performance has increased operating income by more than $3 million per year.
Most importantly, our students are benefitting from improved service and an estimated savings that could reach as much as $10 million annually by the spring of 2012 through the sale and buyback of used textbooks and Follett’s new rental program. This level of projected savings would not be possible without strong faculty support to reduce textbook edition variability in each course.
•A statewide agreement with Dell Inc. to reduce IT costs. Ivy Tech entered into a three-year partnership with Dell that allows for discounted pricing on laptop and desktop computers. By selecting Dell to help simplify IT and make it more accessible and affordable for its students and employees, Ivy Tech is saving more than $1.3 million annually.
•The consolidation of the college’s copier and copier services.
Ivy Tech entered into five-year contract with IKON Office Solutions, a Ricoh company, to consolidate the copier buy and copier services. Ivy Tech will save more than $2 million over the term of the contract.
•A statewide call/fulfillment center to manage communication with prospective students. During a period of unprecedented enrollment growth, Ivy Tech awarded The Jackson Group a two-year contract to assist a statewide call/fulfillment center that improves our ability to leverage communication technology advances and saves more than $250,000.
•Furniture-buy consolidation. Three-year contracts with 10 suppliers, five of which are Minority and Women’s Business Enterprise designees, have been established to support college requirements for more than 160 furniture items to save more than $1 million per year.
•Guaranteed Energy Savings Contract. The college will replace inefficient boilers, lighting and other energy consumers and controls at its Indianapolis campus, deploy PC energy management software statewide, and, as a result, expects to save $10 million over 20 years on a net present value basis.
Overall, since 2008, Ivy Tech has improved its purchasing practices to create nearly $19 million of one-time savings and another $12 million in recurring annual savings.
Even more important than these bottom-line savings, however, are what they enable: For example, we recently hired nearly 300 faculty and staff statewide to accommodate our growing student population – and because of efficiencies like those mentioned above, we did so without adding to our budget.
These new employees are not administrators, they are faculty and staff who work directly with our ever-growing population of students.
Our trustees understand this connection between cost savings and growth. Ivy Tech also recognizes that its role as the state’s largest workforce development provider means that state support of the college represents an investment in Indiana’s future – and we’re confident we offer a unparalleled rate of return.
As more students complete degrees and certificates, they will acquire the improved skills that in turn fuel increased private investment and the growth of our tax base.
This is not only the best way for the state to recover from the challenges it faces – it is the only way.
Ivy Tech stands committed to doing its part by continuing to serve as a good steward of resources and a champion of operational efficiency.