Working Smaller and Smarter

Nearly 8,000 people called Human Resources in September with questions about jobs and benefits. The individuals needing information probably noticed nothing different. But for the team fielding the calls and processing paperwork, the month marked a new beginning.

Two team members had taken the early retirement offer in August, and the Human Resources Information Center had fewer employees to handle about 400 calls a day and hundreds of benefits transactions.

"September is always an incredibly busy time for us, and the team definitely felt the strain of being smaller," said Jen Mathot, who leads Employee Services in the Human Resources Information Center. "But teamwork, collaboration and lots of planning made the transition mostly invisible to others."

The smaller team in the Human Resources Information Center is illustrative of a smaller Duke: the university has shed 425 positions since February 2009 when a vacancy management initiative started as part of a university-wide effort to close an estimated $125 million budget shortfall by 2011. The smaller workforce, partly due to 239 positions left vacant by the early retirement incentive, reverses a four-year trend of increasing positions by more than 500 each year.

Since the market meltdown of 2008, the university's administrative reform effort has covered a range of cost-cutting to avoid large-scale layoffs ranging from limiting salary increases and curtailing external hiring to reducing overtime expenses equivalent to 45 positions and adjusting campus services. In addition, academic schools have worked to maintain balanced budgets.

Reductions in compensation-related expenses have saved about $25 million in the current fiscal budget, which runs through June 2010. More savings are expected from the latest cost-saving strategy, a second voluntary retirement incentive for select salaried (monthly-paid) staff positions.

"We are making progress," said Tallman Trask III, executive vice president, "but we still have a long way to go."

Hof Milam, vice president for finance and treasurer, said that despite recent improvement in stock market indices, Duke expects to see declines in distributions from the endowment and investments. Because endowment distributions are based on a three-year average, "we see the endowment distribution declining through fiscal year 2012 and possibly fiscal year 2013," Milam said. "What we are dealing with is a moving target."

Across Duke, people are retooling for a shrinking budget and workforce. Call center staff members are cross-training to process benefits changes. New imaging technology in Accounts Payable is saving staff time -- and positions. And facilities crews are changing how often they cut grass and perform non-critical maintenance.

Managing Volume More Efficiently

There is seldom down-time for the Human Resources Information Center. In an average month, the staff answers nearly 8,000 calls; responds to requests from nearly 1,000 walk-ins; and processes nearly 600 benefit changes, not including the paperwork for new hires.

In anticipation of the vacant positions created by early retirements, the call center spent the summer examining processes to enhance efficiency. The team eliminated areas of duplication with other departments, and members cross-trained so they could more easily shift from fielding phone calls to processing forms and data. The team in the Human Resources Information Center decided how much time each person needed away from the phones to process paperwork, and they experimented to find the best fit and balance of tasks for each team member.

"We wanted to ensure we covered the gaps in service, but at the same time, offer staff members opportunities to learn new responsibilities as part of their professional development," said Mathot, who has led the information center for two years. "It's a time of big transition, and the team has been incredibly flexible in handling it."

Adjusting Services

The university is targeting several hundred thousand dollars in savings this fiscal year by reducing energy consumption, a cost-cutting idea submitted by many Duke community members through Duke's "Enduring A Troubled Economy" website.

Where possible, temperatures in university buildings that are on the central control system will be set at approximately 68 degrees in the winter and 76 degrees in the summer. The actual room temperatures can be within two degrees (plus or minus) of those set points.

"Since departments pay for what they use, this is an opportunity for everyone at Duke to help cut costs and contribute to a sustainable goal," said Kemel Dawkins, vice president for Campus Services.

In addition, some services departments are changing how they meet basic, non-urgent service demands with reduced budgets and fewer staff.

Less frequently mowed grass, less weeding and slightly longer waits for maintenance requests in non-critical areas are among the strategies adopted by Facilities. As a result, grounds crews will be deployed as task teams for mowing and trimming less often. Critical areas like the NCAA athletic fields will be maintained according to schedule due to collegiate regulations.

"These efforts will increase efficiency and productivity, while maintaining safety and reliability," said John Noonan, associate vice president for Facilities Management.

The Police Department also is adjusting after some police and security officers retired in August. The department will rehire for all five police officer positions left vacant by early retirements. Some of the vacant security officer slots will also be filled, but others will remain open for now.

To adjust, the department has expanded contract security services and changed staffing at certain special events by combining roles and responsibilities. For example, for the first home football game, Duke police reassigned some traffic officers to stadium security and hired some Durham police officers to help monitor the event. These strategic deployments saved on compensation-related expenses but did not compromise service for the campus community, said Aaron Graves, associate vice president for safety and security.

"We have to become more prudent with our resources and creative in how we deploy, train and respond to the needs of the community," Graves said. "We were able to reduce the level of football game staffing by nine officers just by reviewing what is truly needed versus doing what we have always done in the past. And we maintained our high level of response and service."

Technology Offers Solutions

A new imaging system has eliminated the need to fill all five positions vacated by retiring employees in the Accounts Payable department.

The imaging system scans 40,000 paper invoices each month and automatically captures data needed for payment, loading an image of each invoice into a financial database for users to view.

Jim Allen, director of Accounts Payable, said the system eliminated the need to have an employee copy and mail thousands of invoices to departments each month. It also automated the workflow for invoices blocked for payment because of missing information. The system now flags problem invoices and automatically returns them to departments for corrective action.

"If we had not embraced this technology, we would have to replace the people who retired, or we would have ended up with a month's backlog of unpaid invoices," Allen said. "Now we can handle the workload with fewer people."

The Graduate School also looked to technology to help a smaller workforce stay on top of the job. A new paperless process for distributing admission applications allowed the school to eliminate one position vacated by a retiring employee.

"We no longer have to have someone print, collate and deliver nearly 9,000 application packets to and from 55 different departments each application season," said Cynthia Robertson, associate dean of finance and enrollment services.

Provost Peter Lange said that despite flat budgets, Duke's schools and academic units have maintained "quality and momentum and have begun some processes that will lead to significant innovation."

Administrators said they are proud of how faculty and staff have met the economic challenges.

"These are difficult processes to go through," Cavanaugh said. "The collaboration across the entire campus has been outstanding. I believe everyone understands we are in this together, and maintaining the esprit de corps is essential."

New Retirement Incentive Offered

As part of the continuing effort to reduce expenses, the university has offered a voluntary retirement incentive to nearly 200 salaried (monthly paid) staff members who meet specific criteria.

In addition to other eligibility requirements, employees must meet the "Rule of 75" (years of service + age = 75 or more) by Dec. 31, 2009. Faculty and Duke University Health System staff members are not eligible. Kyle Cavanaugh, vice president for Duke Human Resources, said the program is another step toward helping reduce overall compensation expenses, which will limit the potential for involuntary layoffs later.

The university has implemented a range of initiatives, including the first retirement incentive directed to hourly-paid (biweekly) staff in Duke's pension plan. Nearly 300 staff members took part in that incentive. Individuals offered the Monthly Staff Retirement Incentive have until 5 p.m. Dec. 8 to enroll. Staff who retire under the incentive receive a one-time, lump-sum payment equal to two weeks of pay for each full year of continuous service with Duke (up to 52 weeks of pay). The retirement dates are Dec. 31, 2009 or January 29, 2010.