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DART: Targeting Cost Savings

DART: Targeting Cost Savings

Team Seeks Administrative Reforms to Address $125 Million Shortfall

Topics for this story: News Releases
May 27, 2009 |
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Durham, NC - Lesley Jones walked by an opportunity to save money every payday.

"When I walk by our departmental mailboxes on paydays, I see many printed pay stubs and am surprised by the fact that so many employees still receive their pay stub in paper form," said Jones, a customer service manager for Duke University Press. "I think that the Duke@Work portal is really helpful, and I enjoy being able to view my pay statements online."

She and several others submitted the cost-saving idea to move to online pay statements. The idea was embraced by the Duke Administrative Reform Team (DART), a group of administrators, faculty and staff reviewing ways to reduce costs and improve efficiency. It will go into effect in July.

Changes such as this reflect the beginning of a three-year process of reducing the University's budget by approximately $125 million as a result of the global economic slowdown. Compensation-related expenses comprise about 60 percent of the budget, and the University has implemented several efforts focused on this area, including suspending annual pay increases for those making more than $50,000, the curtailing of external hiring through a vacancy management process, and a staff retirement incentive offered to 825 individuals.

"The big variable right now is how many people take the retirement incentive," said Tallman Trask III, executive vice president and co-chair of DART. "What we do afterward depends largely on how much we save through that process."

Trask said that he hopes to reduce the budget by $50 million this year, but identifying sizable savings beyond the staff retirement incentive becomes more challenging.

"Reducing expenses by $125 million is a big change, and trimming around the edges isn't going to get us there," he said. "Most of the low-hanging fruit has already been picked. We need creative ideas that reach beyond the obvious to consider how we can do things differently to realize significant savings while maintaining effective services and support."

More than 170 cost-saving ideas have already been submitted through the Enduring a Troubled Economy website. Ideas submitted range from regulating heating and cooling in buildings to save on energy costs to renegotiating contracts and encouraging work from home options.

All ideas submitted through the website are being reviewed by DART, which has met weekly since mid-March. Tim Walsh, assistant vice president and university controller, leads the DART analysis committee, which collects and presents data to DART to identify high-potential ideas that should be more thoroughly investigated for potential savings. Then the committee will focus on developing a "tool-kit" of options for deans and senior leaders to consider as cost reduction strategies within their respective areas.

In addition to moving to online pay statements, several suggestions submitted by faculty and staff have already been implemented, including:

  • curtailing external hiring through the vacancy management initiative,

  • offering a staff retirement incentive plan,

  • limiting use of consultants and contract services, and

  • extending the cycle for computer replacement.

While these and other changes represent only a fraction of the needed savings, each measure can be viewed in terms of positions saved.

"We are taking every step possible to identify cost-saving measures that will hopefully limit the potential for involuntary layoffs," said Kyle Cavanaugh, vice president of Human Resources. "Every position we can reduce by curtailing hiring, retirements and attrition may reduce the need for further action later."

The DART team hopes employees continue to share cost saving ideas through the website and within their departments.

"For us to have the answers, we are going to depend on everyone," said Hof Milam, vice president of finance. "I encourage employees not only to submit ideas to the website but also to supervisors or others in your office. I know that I have had a number of good suggestions from my staff, and I find often that the best ideas come from the people who are closest to the action."

To read more cost-saving ideas and responses or to submit your own, visit the Enduring a Troubled Economy website.

© 2012 Office of News & Communications
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