A Smaller Duke Amid Downturn

As North Carolina's unemployment hovers at nearly 11 percent, the number of people looking for work at Duke has hit an all-time high: 10,367 people applied this January -- a 52 percent increase over the same month last year.

But applicants face increasingly long odds of landing a job at Duke.

"We're still conducting strategic hiring, but clearly not as much as before," said Kyle Cavanaugh, vice president for Duke Human Resources. "Realistically, since labor costs account for more than half of our budget, we are looking at having to become a smaller Duke in order to position ourselves for the future."

The drop in the value of Duke's endowment, declines in philanthropic giving and uncertainty over federal funding has left a $125 million shortfall in the operating budget. As a result, the University is cutting costs and slimming down by re-evaluating hiring new employees, restricting pay increases, offering an early retirement incentive and creating a team of faculty and staff to aggressively look for ways to become more efficient.

The team, known as the Duke Administrative Reform Team, or DART, is identifying opportunities to redesign major processes and services that span the institution in an effort to become more efficient, without weakening Duke's academic mission. At the department and unit level, Duke is asking faculty and staff to be ever more frugal, find ways to consolidate jobs, eliminate expenses and creatively work through these tough times.

"We believe taking these steps now will help close the deficit in the operating budget, while protecting the jobs of as many people at Duke as is possible," Cavanaugh said.

Fewer Positions

Filling jobs at Duke is now tougher -- and requires more oversight.

University departments and units have been asked to cull through their vacant staff positions and determine which ones they can eliminate. Under a new vacancy management policy, Executive Vice President Tallman Trask III, Provost Peter Lange, or one of their designees, must sign off before any University unit or department can recruit for a new staff position. Faculty hiring will continue, although at a slower rate.

The result is a dramatic drop in the number of jobs for which Duke is hiring. Open and posted positions across the University plummeted 44 percent, from 1,394 in February 2008 to 786 this February.

"As departments continue to re-evaluate their labor costs, this number could get smaller," said Denise Motley Johnston, director of recruitment.

While other universities such as Princeton, Stanford and Johns Hopkins are in hiring freezes, Duke is not. Positions that remain open include clinical care jobs, positions financed by research grants or other external funding, including the federal economic stimulus package, and jobs considered critical to ongoing operations.

Donna Crenshaw filled one of those positions in February. When her position as a pharmacogenetics consultant at GlaxoSmithKline was cut in December 2008, she immediately applied for a research scientist position at Duke's recently established Deane Drug Discovery Institute.

"I knew there was this exciting new venture at Duke and wanted to be involved," she said. She was excited about applying her skills and knowledge to help faculty move potential therapeutics along the drug discovery pipeline. "It is a small operation, so I was very happy to be hired."

Creative Cost-Cutting

The push to reduce costs and improve efficiencies creates opportunities for departments to reconsider staffing models.

Take Human Resources, where Jamie Stallings worked as a staff assistant in the vice president's office. She was looking to expand her responsibilities. At the same time, two other units within Human Resources wanted to fill administrative positions left vacant by staff retirements.

Human Resources combined the two vacant positions and hired Stallings as a staff assistant supporting both the communications unit and the Human Resources Information Center, said Bill Marchese, director of the business office in Human Resources. When the department did not fill Stallings' original position, the net result was the elimination of two jobs.

Cavanaugh said that with several other jobs eliminated through retirement or turnover and a reduction in operating costs, "we are looking at a million dollars less in expenses for the Human Resources department in fiscal year 2009-10."

Human Resources is not alone.

Duke's Academic Council, the faculty governance organization, passed a resolution in March calling for every dean to establish a faculty advisory committee "to assist in the process of making strategic choices relating to cost controls and reductions."

And in the School of Nursing, labor savings are coming from rethinking job responsibilities. When turnover in the school's business office created a vacancy, the department redistributed work and added a few hours to a part-time position rather than rehire a full-time employee.

"That allowed us to keep someone who was familiar with our unit, and eliminate about three-quarters of the cost of a full-time employee," said David Bowersox, the school's associate dean of finance and administration.

Collaborative Process

As schools and units work to reduce costs for labor, travel, equipment and services, the Duke Administrative Reform Team, chaired by Trask and Lange, continues to examine administrative processes to decrease costs.

The team is taking a closer look at staffing levels and services that cross multiple departments, where Duke can eliminate duplication or change processes to operate the university more efficiently. Initial areas slated for review include audit and compliance; facilities and maintenance strategies; information technology and related support; parking and transportation; and printing, publications and websites. The scope of the team's charge, however, is well beyond these areas, spanning virtually every administrative function and process.

"We have been taking input from across the university -- from the call for ideas on the Duke Enduring a Troubled Economy website, to interviews and anecdotal information," said Tim Walsh, Duke's assistant vice president and controller. He chairs the team's analysis subcommittee. "If the initial assessment indicates that there might be big savings, we look further."

Walsh said the analysis subcommittee will provide data to the administrative reform team before the fiscal year ends June 30. The team will decide which cost-savings projects move forward.

The key to success is the collaborative nature of the endeavor, he said. "Ultimately, no one should be surprised by what they hear when we bring the data back to the team. We are working closely with each area to ensure that we are integrating as many perspectives as possible into the analysis process before presenting data."

Flood of Applications

As Duke eliminates vacant jobs and redesigns services, competition for remaining jobs at Duke is more intense.

According to Johnston, the director of recruitment, applicants are becoming more aggressive. They demand to see a recruiter. They call back repeatedly.

Since many people apply for more than one job, the result is a flood of applications. For example, in January 2009, Duke Human Resources received 45,269 applications from the 10,367 people hoping to join Duke's workforce.

"Obviously Duke continues to be a very attractive place to work, and in these difficult economic times that means many more people are coming to us," said Johnston. "We not only continue to recruit the very best talent for Duke, we also strive to treat every applicant with the highest level of professionalism."

Cavanaugh, who became vice president of Human Resource in February, said he appreciates the compassion shown -- in recruiting and throughout Duke -- during these difficult economic times.

"At the end of the day, we are dealing with real people going through this, whether it is a manager already at Duke and striving to find ways to save money, or one of the many people applying to Duke because they see Duke as a great place to work," he said. "It is an hour by hour challenge to balance budgetary decisions and compassion. I continue to be impressed by the fact that everyone I have met at Duke understands this."