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Business Officer Magazine
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Business Intel

A roundup of short news articles and useful resources for business officers

RISK MANAGEMENT
Software Streamlines Safety Analysis

When he learned that the IT group didn't have the resources to support custom software development, Erich Fruchtnicht turned to the Internet for a crash course in writing code.

"I had written other software before," explains the radiation safety officer at the Texas A&M Health Science Center in Bryan. "I have very simple, low-level experience with code writing. The Internet has all kinds of resources and videos that teach you and examples of code that others have written so you can understand the mindset. I realized what a vastly amazing educational tool the Internet can be."

The resulting product, Risk-Based Inspection and Reporting Software (RBISAR), streamlines the process for importing lab-safety and fire-safety data, analyzing and generating risk-based inspection schedules, and providing edited reports. Fruchtnicht and colleague John Fellers, director of environmental health and safety (EHS), developed RBISAR based upon a risk analysis method.

Fruchtnicht works in the EHS office, which oversees safety research practices, ensuring they are compliant with state and federal regulations and best practices. He based RBISAR on Microsoft Excel using visual basic code, because the software was already part of his normal business operations.

Fruchtnicht spent a couple of hours a week for about four months to complete his work. "I taught myself how to do it as I was going."

Prior to RBISAR's rollout, he estimates that it took one employee seven days after completion of inspections to generate reports.

"It was very tedious because it was essentially being done by hand," he explains. "Now it takes about one-and-a-half hours."

Increased Efficiency

The software also allows greater access to trending data and pinpoints problems so that the safety office can target training and rapidly resolve issues. For example, Fruchtnicht recalls that about a year or so ago, the inspection schedule indicated that one of the campus buildings required daily inspections due to ongoing issues. Using the RBISAR system, he wrote a routine that identified the specific problems.

"It was something easily corrected," he says. "Flammable storage refrigerators were not labeled as flammable storage. That's easy to fix because we collect [information about] which rooms they are in. We could go to those areas and say, 'Here's a sign. Put it on your refrigerator, please.' That dropped us back down to an annual assessment time period."

His office inspects both lab and fire safety. Commonly identified risks might include fire extinguishers that have not been checked; fire sprinklers that are blocked; exit signs that are not illuminated; and an access door, electrical panel, or fire alarm panel that is blocked.

Code Writing Caveats

From the process, Fruchtnicht learned that code writing involves more than correctly solving the original problem. "You also have to anticipate how people will try to incorrectly use your software," he explains. "The software has to recognize that individuals are trying to force the code to do something it's not supposed to, and then tell them, 'No, you need to go over here.' Anticipating human behavior was an interesting learning experience."

For example, he recalls several instances in which people tried to massage the data manually before hitting the report routine. "They wanted a particular format when the system finished. Well, the system has a particular way to approach the formatting based on the data we get, so any kind of manual tweaking doesn't make it happy. I had to have a little message box pop up and say, 'Please don't edit the data here. Please go over here, and do it in this other manner.'"

Fruchtnicht, who built the system after soliciting feedback from coworkers, encountered no resistance during the rollout and implementation. He gives credit to his managers, including Barry Nelson, vice president for finance and administration, for supporting technology innovations. "Dr. Nelson is supportive of technology as a method of process improvement. When people in his command chain are able to come up with ways to be more efficient with time, which is money, that benefits the institution overall."

SUBMITTED BY Margo Vanover Porter, Locust Grove, Va., who covers higher education business issues for Business Officer.

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QUICK CLICK

Support Starts at Home

www.edexcelencia.org/unidos

A case study, "Community Organizing on Behalf of Latino Student Success," released in late November by Excelencia in Education, describes an innovative and effective community organizing approach. Coauthoring the study with Teresa Brito-Asenap, Unidos community liaison, were University of New Mexico's Jozi de Léon, vice president and chief diversity officer, and Jennifer Gomez-Chavez, director of student academic success. Their case study of the Unidos project explains how engaging local, state, and institutional partners in support of Latino education can lead to more successful students and stronger communities.

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By The Numbers
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SUSTAINABILITY
Colorado HSI Honored for Energy Efforts

FAST FACT

Northwestern University, Evanston, Ill., was the only higher education institution to be recognized as one of the 25 honorees designated as 2015 EPA Green Power Leaders. Speaking about such companies as Apple, Microsoft, Intel, and the National Hockey League, Gina McCarthy, EPA administrator, said, "These organizations are leading the way in cutting greenhouse emissions, acting on climate change, and protecting public health by using billions of kilowatt hours of green power annually."

The Hispanic Association of Colleges and Universities (HACU) and Solution Generation awarded Colorado State University–Pueblo, a Hispanic-serving institution, the HACU/Solution Generation Award for Leadership in Climate Change Awareness.

The award, open to HACU member institutions, looked for "the broadest, most innovative, and most effective outreach effort at engaging the campus and broader community in climate and sustainability solutions." Of 17 applicants, CSU–Pueblo's first place prize of $10,000 will help further its innovative efforts.

According to President Lesley Di Mare, CSU–Pueblo plans to fund undergraduate climate and sustainability research. Specifically, students will study climate solutions tailored for the Pueblo community. Students will focus on local issues, such as increasing energy efficiency for low-income housing, improving indoor environmental air quality, and studying hybrid technologies to replace fossil fuel consumption.

These outreach plans are significant because climate change solutions tend to overlook the poor—and almost 20 percent of Pueblo residents live below the poverty line.

"Colorado State University–Pueblo is extremely proud to be the recipient of this prestigious HACU award," Di Mare said.

SUBMITTED BY Sally Grans Korsh, director, facilities management and environmental policy, NACUBO.

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SUSTAINABILITY
Look Up for Solutions

On sunny days, you can recharge your phone-and yourself—under the shade across the campus at the University of North Carolina–Chapel Hill.

That's because six organizations came together last summer to bring one bright idea to life: solar umbrellas. "It uses the sunlight to generate electricity through the panels on top of the ribs of the umbrella," says UNC's Charlie Egan, co-chair of the student government's Renewable Energy Social Projects Committee. "That energy can be stored in the battery hub that sits on top of the table and allows you to charge your phone using the energy generated by the solar panels."

As students sip coffee in front of the Student Union or catch up on class work near the Pit Stop, they can charge devices using a USB charger. Other locations include the front of Lenoir Dining Hall; outside Chase Dining Hall; and at Morrison, Parker, and Manning East residence halls.

In all, there are 18 of the ZON Powersol mobile charging stations around campus.

"Even if a student isn't interested in energy, he or she can see it and interact with it on a daily basis," Egan says.

Campus partners who made the powersols possible include the following organizations and departments: the Renewable Energy Special Projects Committee, the Carolina Union, Carolina Dining Services, the Residence Hall Association, Student Stores, and UNC Information Technology Services.

SUBMITTED BY Philip Jones and Carly Swain, office of communications and public affairs, University of North Carolina–Chapel Hill.

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DEBT MANAGEMENT
The Growing Cost of Being Financially Conservative

Before the recent financial crisis, most higher education institutions were focused on minimizing debt. After the crisis, institutions responded by increasing cash and cash equivalents, resulting in the average college or university holding twice the amount of cash it held before 2008, said Casey Rogers, managing director and head of higher education at Wells Fargo Securities. Rogers led a panel discussion at the NACUBO 2015 Annual Meeting in Nashville focused on the impact of the current interest rate environment on the bottom line of higher education institutions.

"Many institutions are in a surprising position of being high on cash and low on debt," Rogers said. "They should be rooting for rates to rise." The median public institution has 6 percent floating rate debt and the median private institution has 4 percent, Rogers said.

But according to presenters, that fiscally conservative position can be costly for institutions, preventing them from maximizing their positions. Brett Sweet, vice chancellor for finance and CFO at Vanderbilt University, Nashville, and Jim Matteo, associate vice president at treasurer at the University of Virginia (UVA), Charlottesville, shared with attendees some of the financial strategies their institutions are benefiting from in the current environment. For instance:

  • Consider liquidity more than cash. "Before the financial crisis, we all felt good because we had thousands of days of cash on hand," Sweet said. "But then we realized that number was meaningless, because it didn't show how much we could access immediately." Today, Vanderbilt intentionally keeps a significant amount of cash on hand, based on operating expenses for a couple of months at a time—"we have a bit of post-traumatic stress and need to be prepared to weather potential storms," he said.
  • Utilize an internal bank. At UVA, an internal bank centralizes internal management and helps elevate cash and liquidity choices, Matteo said. To ensure its effectiveness, financial staff has extensively expanded dialogue with other stakeholders across the university. "We offer schools the ability to get an immediate return from our bank," he said. "We have seen board turnover and executive management turnover, and we have learned to talk regularly with the management team about liquidity and other issues."
  • Pay close attention to health care. Both Vanderbilt and UVA are home to medical schools and research hospitals, and rapid changes in health care affect their bottom lines. "We talk with our medical center quite a bit," Sweet said. "The changes in health care are where a lot of our risks reside." To stay in tune, the financial office uses cash flow forecasting, looking at monthly fluctuations on a line-item basis, such as reviewing tuition and fees. It's an ongoing process, and "there's no magic bullet," Matteo added.
  • Manage competing objectives. In the aftermath of the financial crisis, it has become increasingly important to manage the competing objectives of treasury, which manages operating assets, and investment, which manages the endowment assets, Matteo said. "If they want to make a change on the endowment side, we can make changes on the treasury side to balance that, because diversity is important," he said. "We're starting to look past the risk of debt and looking at the risk on our balance sheet."

SUBMITTED BY Nancy Mann Jackson, Madison, Ala., who covers higher education business issues for Business Officer.

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LEADERSHIP
Inspiring Innovation

Innovation is not an accident; it's an exercise, and it's a process," argued Jeff Hoffman, cofounder of Priceline.com, during his keynote at the fall EACUBO 2015 Annual Meeting, in Philadelphia.

Hoffman, an entrepreneur, and coauthor of Scale: Seven Proven Principles to Grow Your Business and Get Your Life Back (Portfolio, 2014), contends that the world's most creative companies consider innovation an actual process—and challenged the audience to conduct practical activities to create and manage an innovation process within their own institutions.

Hoffman described three techniques to further that goal:

  • Open up your mind—adopt the five-year-old child's spirit of inquiry. "Take some time to wonder," says Hoffman. "Stop and look at something as if it were the first time you've ever seen it." Hoffman gave the example of walking through his office one day and finally noticing a huge piece of equipment that had been there for years—covered up by a large plastic sheet. No one knew what it was or the last time it had been used. Hoffman promptly discarded it. His message: Set aside one day each quarter as "see it as a five-year-old" day, and rediscover things you've been walking by every day.
  • Sit in the passenger side of life. When you are the driver, you miss more than you know, said Hoffman. "One day, I was the passenger, driving along a route I take every day. I couldn't believe the buildings, parks, and businesses I'd never even noticed, because I was keeping my eyes on the road."
  • Become an information sponge. This requires broadening your slice of experiences, and applying what you learn, Hoffman explained. "I've had a chance to spend time with some brilliant people in my own industry, but I try to spend some time each day exploring another industry or sector." Hoffman told the audience: "Spend that time not exploring higher education; your goal is to learn one thing every day that you do not need for your business." Using this process, Hoffman assembled a seemingly unrelated group of ideas. By rearranging the learning, he said, he pulled together the elements of Priceline: distressed inventory, a perishable commodity (unsold airplane reservations), dynamic pricing, and online consumers. "This only happened because I continued to be an information sponge."

In your institutions, Hoffman cautioned, "if you leave the current business model in place, you'll not be ready for younger generations of students. They will spend their tuition money on creating a startup company."

SUBMITTED BY Carole Schweitzer, editor in chief, Business Officer.

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PROCUREMENT
Partnership Pointers

In the NACUBO 2015 Annual Meeting session "An Insider's Guide to Outsourcing," three chief business officers shared their experiences of what makes for a good partnership.

Why do institutions outsource? For some, it may be in response to a cash flow challenge, a service or quality issue that they are trying to improve, the need for technical expertise or other capacity that does not exist internally, or a desire to launch an initiative quickly.

While the goal of generating new revenue streams may underlie many outsourcing partnerships, more important are opportunities to improve service and quality, argues Morgan Olsen, executive vice president, treasurer and chief financial officer, Arizona State University, Tempe. "Our primary concern is whether a relationship helps us meet the needs of our institution."

Mutual Understanding

For ASU, outsourcing partners are deeply integrated into the life of the university. "We think the only way an outsourcing relationship will be successful is if our partners understand our campus culture, mission, and goals," says Olsen. He notes that one provisional screening for outsourcing a function used to be whether it was central to the institution's mission—and if so, not to outsource it. "We find that a less-useful screen today," says Olsen. "We look for partners that can create synergy and contribute deep domain knowledge, including in areas we consider mission-centric." That said, it's essential that your outsourcing partner embraces your brand, warns Olsen. "This is fundamental for us, and we spend a lot of time on building that understanding upfront."

Enough Internal Support

Once you outsource a function, you still need the right internal staffing resources to oversee the relationship, says Steve Sayers, senior associate vice president, University of Cincinnati. Harold Hewitt Jr., concurs. "You should anticipate spending as much time with an outsource partner as you would with your employees, if you were managing the function internally, says Hewitt, executive vice president and chief operating officer, Chapman University, Orange, Calif. He also advises setting clear expectations upfront with your partner regarding goals and metrics.

At the same time, institution leaders should acknowledge and appreciate the differences in approach that your partners may bring. "Culturally we are not afraid to try new things because we know higher education must become more adaptive, innovative, and nimble," says Olsen. "The test is whether your partners are truly able to integrate your institution's mission as their own. If you have a partner that keeps saying, 'We don't do it that way,' then you may have the wrong partner."

Two-Way Talk

Sayers concurs. "Don't shy away from asking partners to bring their suggestions for improvement to the relationship. If this is a true partnership, you want that exchange of ideas." As with any relationship, needs evolve, so you want to make sure your partnership has the capacity to withstand adjustments along the way, he adds.

On occasion, things can go sour, notes Hewitt. Everyone involved should be clear about expectations and essential metrics. Even at the start of a partnership, Hewitt suggests having a transition plan in place should the need arise to terminate a relationship.

SUBMITTED BY Karla Hignite, New York City, who is contributing editor, Business Officer.

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