IU Bloomington: BAP: Responsibility Centered Management 2000

Name	Department
Dan Amonett	GSO Coordinator
John Bingham	IUSA
Ann Bristow	Libraries
Jerry Dorsey	Dean of the Faculties
Sheryl Fisher	Education
Kirsten Gronbjerg	SPEA
Gary Hieftje	Chemistry
Michael McGerr	History; LAMP
Michael Metzger	Business
Tony Mobley	HPER
Charles Nelms	Academic Support & Diversity
Eugene O'Brien	Music
Judith Palmer	Vice President & Chief Financial Officer
Lauren Robel	Law
Al Ruesink	Biology
Neil Theobald	Co-Chair, Education
Maynard Thompson	Co-Chair, Budgetary Administration & Planning
David Zaret	Sociology/COAS

Table of Contents
Executive Summary	i
1. The Historical Context	1
Policies and Procedures Used Before RCM: Pre-1990	1
Design and Implementation: 1990-1996	1
The 1996 Review and Implementation of Recommendations	3
2. Methods of the 1999-2000 Review	6
3. Findings of the Review	7
Positive Comments	7
Negative Comments	8
4. Recommendations	14-15
Proposed Modifications	15
5. Concluding Comments	20

Attachments
1. Appointment letter	A - 2
2. RCM Review Committee	A - 3
3. Announcement of review	A - 4
4. Individuals and groups interviewed	A - 5
5. Interview protocol	A - 7
6. Total operating state appropriation FY76 through FY00	A-12
7. Student headcount by school and student level Fall 95 through Fall 99	A-13
8. Student credit hours by school and student level FY96 through FY00	A-14
9. Undergraduate credit hours by school (graph)	A-15
10. Graduate and professional credit hours by school (graph)	A-16
11. Expenditure budgets and credit hours by school FY96 through FY00	A-17
12. Budgeted expenditures per actual credit hour (graph)	A-18
13. Academic FTE credit hours by school FY96 through FY00	A-19
14. Credit hours per academic FTE by school (graph)	A-20
15. Professional and biweekly staff FTE Fall 95 through Fall 99	A-21
16. Increases to school and support RC budgets FY95 through FY00	A-22

Appendix
Assessment allocations, algorithms and parameters FY00

Executive Summary

Report of the RCM Review Committee
Indiana University Bloomington
May, 2000

In the fall of 1999 a Committee was appointed by Vice President and Chancellor Kenneth Gros Louis to review the policies and procedures of the financial planning, budgeting, and financial administration system known as Responsibility Centered Management. The Committee investigated the perceptions of RCM by soliciting comments from faculty and others and by interviewing those individuals and constituencies whose views were broadly representative of campus opinions and who had insights and experience regarding RCM. The Committee also collected information and data to help in determining the impact of the implementation.

The Committee heard many positive and some negative comments. In many cases it was clear that comments on the general financial health of IUB were mixed with comments on RCM.

· Units with rapidly growing student enrollments do not have the resources to meet instruction needs because of the lag in fee income distribution.

· RCM provides incentives for units to monitor their performance with a goal of increasing efficiency and effectiveness.

· RCM makes units aware of student interests and needs and students have benefited from improved course availability.

· The transparency of the budgeting process under RCM has enabled good use of scarce financial resources.

· RCM creates a tension between the desire to uphold quality and to maintain student enrollments.

· The Chancellor does not have adequate resources to sustain and enhance quality and to fund the campus ‘common good.’

· The flexibility of RCM has provided an environment in which units can get deeply into financial trouble before remedial action is taken.

· There is concern that the system may be one factor causing an erosion of the spirit of collegiality and cooperation that has been such a valuable aspect of academic life at IUB.

Based on its findings, the Committee made a number of recommendations including the following:

· The resources available to the Chancellor for support of initiatives to sustain and enhance quality and to support the campus ‘common good’ be increased over three years from 1.5 percent of state appropriation to 2.5 percent.

· Instructional fee income attribution be modified to provide more timely support to rapidly growing units and to support courses taken by students not included in the official first week census data.

· The Chancellor's fund has a specific priority to foster inter-unit cooperation.

· The Campus Budget Office should monitor unit financial performance and work with the unit administration to achieve financial goals. If financial problems emerge, there should be timely intervention to identify and resolve those problems.

Finally, it is recommended that the Office of Budgetary Administration and Planning continue to monitor the RCM process and consult with the Deans Advisory Committee and the Budgetary Affairs Committee regarding additional modifications. There should be another comprehensive review not later than the 2004-05 academic year.

Responsibility Centered Management at
Indiana University Bloomington

In September, 1999, Kenneth R. R. Gros Louis, Vice President for Academic Affairs and Bloomington Chancellor, appointed a Committee to review the Bloomington Campus version of Responsibility Centered Management (RCM). The Chancellor's Charge to the Committee is appended as Attachment 1. When RCM was introduced in 1990, it was anticipated that the system would evolve through modification, and that has been the case. During the 1995-96 academic year, a previous RCM Review Committee analyzed the system and made a number of recommendations that were implemented beginning in 1997. The Bloomington Campus now has the experiences of nine full fiscal years, and it is appropriate again to evaluate the policies and procedures that underlie our financial planning and management. This report identifies and clarifies the strengths and weaknesses of the present version of RCM and suggests possible modifications.

Policies and Procedures Used Before RCM: Pre-1990

Prior to 1990, Indiana University Bloomington used a traditional centralized fiscal management system that attributed all state appropriations, student fees, and other income to campus-level accounts. Each year, the campus held a series of budget conferences with each instructional unit and the major academic and administrative support units. During these conferences, each dean or director presented a plan for the next year, and requested funds from campus-level accounts to support these initiatives. In response, the campus allocated resources to each unit for salary adjustments, financial aid, general supplies and expenses, travel, equipment, and so on. These allocations were guided by the operating budget approved by the Legislature, especially in the areas of compensation and special initiatives, and by the advice of the Budgetary Affairs Committee and the Chancellor's staff. Units were required to use the resources for the specified purpose; reallocation of funds within units required approval from campus-level budget officers. Thus, the Chancellor’s Office exercised control over both the total resources available to each unit and the way these resources were used.

· all costs and income attributable to each school and other academic unit should be assigned to that unit;

· appropriate incentives should exist for each academic unit to increase income and reduce costs to further a clear set of academic priorities; and

The system was developed with the active participation of faculty, the Budgetary Affairs Committee, deans, campus level administrators, and system level administrators. Dr. Edward Whalen, Director of the University Budget Office, provided general leadership in the process. Preliminary drafts of policies and procedures were widely discussed during spring of 1988 and the 1988-89 academic year. Until implementation of RCM, budgets continued to be constructed in the traditional manner; however, costs and income were attributed in shadow budgets in RCM format in 1988-89. The original intention was for both IUPUI and IUB to shift to the new budgeting system on July 1, 1989. Howeve r, in the fall of 1988 a review of progress toward implementation indicated that there were compelling reasons to defer implementation at IUB until July 1, 1990. IUPUI proceeded with implementation on July 1, 1989.

In the spring of 1990, budget construction for 1990-91 proceeded as usual with the construction of expenditure budgets for all units using all anticipated resources. Then, anticipated student fee was attributed to instructional units and other income was attributed to the units generating that income. The costs of non-instructional units were allocated to the instructional units using the algorithms developed over the preceding two years, and state appropriation was allocated to instructional units to provide balanced budgets for each unit. Two aspects of the implementation are especially important and deserve repeating for emphasis.

First, the original allocation of state appropriation was set by the difference between each unit’s income and expenditures. Therefore, units with higher instructional costs relative to income (e.g., Law, Music, Optometry, SLIS) received a larger share of the state apportionment to account for these differential costs. This practice continues with these four units receiving significantly more funding per credit hour produced than do other units. (Attachments 11 and 12). Second, at the time of transition, resources were provided to instructional units to cover all assessment costs.

Accompanying the introduction of RCM, there was a shift in emphasis from planning for the next year only to a multi-year planning horizon. For the last decade, units have been expected to develop budget plans for one year in some detail and for two or three years in greater generality. In particular, units may, and frequently do, accumulate unexpended funds and unbudgeted income in a reserve account at year end (June 30), and expend these reserves over a period of several years. These plans are discussed with the deans regularly to determine progress and revisions, and they provide the setting for the annual budget conferences each winter.

At the time of implementation it was anticipated that the system would be a dynamic one in which the campus would discover better ways of handling some things and not all of the results would be quite as intended. That was the case, and the campus made a number of changes in the early 1990s. For instance, at implementation the campus attributed undergraduate fee income by student residence classification; in the second year the campus shifted to an allocation process in which undergraduate fee income is pooled and allocated to the instructional units by the fraction of credit hours taught without regard to residency status. The expectation has always been that RCM at Bloomington is a dynamic system that will continue to evolve.

The financial environment in which the campus operated in the early 1990s presented a serious challenge to the implementation of RCM at Bloomington. In the five years prior to implementing RCM, state appropriations (excluding fee replacement) increased from $101 million to $141 million, an inflation-adjusted increase of over 17%. During this time FTE enrollments increased by 6%, from 28,277 in the fall of 1984 to 30,084 in the fall of 1989. Thus, the state appropriation per FTE grew by over 10% (inflation adjusted) in the five years prior to the implementation of RCM.

In the first five years after implementing RCM, state appropriations for higher education in Indiana—mirroring a pattern throughout the U.S.—remained essentially flat in nominal terms and dipped sharply in inflation adjusted terms (see Attachment 6). During these five years, state appropriations (excluding fee replacement) increased by 1.1 percent in nominal terms. During this period prices inflated by 14.7 percent and consequently, state appropriation actually fell by over 13% in inflation-adjusted dollars. During this time FTE enrollments continued to climb, reaching 31,158 in the fall of 1995. As a result, the state appropriation per FTE dropped by almost 17% in the initial five years of RCM.

Although the increase in enrollments and increases in instructional fees provided additional resources, the financial constraints created by the large decline in the purchasing power of state appropriation created widespread apprehension across campus. In addition, as a part of the policy of President Ehrlich there were significant reallocations from non-instructional units to instructional units. RCM became the ‘lightning rod’ for much of the discontent about the financial difficulties facing the campus and its largest RC, the College of Arts and Sciences. Apprehension spread that this new budgeting approach was transferring resources from non-instructional units to instructional RCs and mechanically reallocating scarce resources among instructional RCs on the basis of student enrollment patterns while not providing a sufficient role for academic judgements about the quality of these courses.

In the fall of 1995, a committee was appointed by Vice President Gros Louis to review RCM and formulate recommendations for modifications to the system.

The report produced by the 1996 Review Committee strongly endorsed the continued use of RCM. While it admitted that “the Review Committee encountered diverse views about RCM”, it found that “RCM is a planning/budgeting/management system that is working reasonably well, that most of the elements should be kept, and that what is needed are some modifications to make it work even better.”

The 1996 Review Committee made three major recommendations and several other recommendations to improve RCM. The major recommendations were:

· establish a Chancellor's Discretionary Fund by allocating up to 1.5% of the state appropriation to the Chancellor to preserve and enhance quality and leverage campus priorities,

· institute a two-year weighted average lag between enrollments and fee income distribution to "smooth income flows," and

Among the negative perceptions of RCM that were received most often by the 1996 Committee was that “less discretionary money now exists at the campus level for meeting the ‘common good’ needs of all.” Prior to the implementation of RCM, each year the Chancellor allocated a portion of the incremental resources to achieve campus goals that involved several units or the entire campus. Under the initial version of RCM, though, the Chancellor did not have access to such discretionary resources.

The Committee viewed this “as a shortcoming” and recommended that “each year the Chancellor have resources that can be allocated to leverage campus priorities to achieve campus-wide goals.” These resources should be generated by “allocating 1-1.5% of state appropriation to [this purpose].” According to the report, “the campus chancellor has a major role to play in leading the campus and promoting a shared vision.” To address this problem, the Chancellor’s Discretionary Fund was proposed as a way to provide resources for the Chancellor to “nurture and reward quality undertakings” and “leverage campus priorities.” According to the report, “units receiving resources from this fund would have special accountability responsibilities since it is essential that the resources be used to enhance quality and not circumvent the usual incentive structure of RCM.”

Since 1997, the Chancellor’s Discretionary Fund has been used each year in three primary ways: (a) to enhance or maintain quality, (b) to provide units with additional academic investment funds, and (c) to stimulate inter-unit cooperative ventures and initiatives. Although each year the initial allocation to the CDF was 1.5 percent of state appropriation, a portion of that has been allocated to the College and schools on a proportional basis as general support for the academic mission. In addition, a portion of the CDF has been used to fund campus priorities such as the Library and research initiatives. The fund has intentionally not been used to address budget difficulties that have resulted primarily from the actions or inactions of a particular school. In making these allocations, the Chancellor has sought the advice of his usual advisory groups.

Initially, tuition income under RCM was allocated according to the distribution of credit hours in the current year. Thus, deans had to budget and hire faculty based upon enrollment projections. When enrollments fell short of expectations, deans found it was too late to alter hiring plans and when enrollments exceeded projections, RCs found themselves scrambling to find instructors for extra sections. Thus, in 1991 the campus moved to moderate this situation by distributing the current year's income based on the previous year's enrollments by RC. In essence this removed one part of the uncertainty for the deans. Previously, there had been uncertainty about both the amount and distribution of instructional fee income. With the revision, the distribution was known and only the amount remained unknown prior to the beginning of the fall semester.

The 1996 Review Committee received many comments that “even this one-year lag does not provide units with enough latitude to alter teaching plans.” In response, the Committee concluded “that enrollment shifts should be moderated” and recommended that the tuition distribution be based on the averaged student course enrollment numbers of the prior two years. The Committee argued that a two-year lag

provides more opportunity than at present for a unit to make teaching plans with a realistic budget estimate, yet it does not isolate a unit too much from the urgency to reduce costs by cutting sections when student numbers fall, nor does it ask a unit with increasing student enrollments to wait too long before receiving the appropriate increases in resources.

Since 1997, undergraduate instructional fee income has been distributed according to the fraction of undergraduate credit hours taught in the preceding two years. At the same time, assessments that depend upon undergraduate credit hours were adjusted in the same way (i.e., units experiencing enrollment shifts have their assessments adjusted at the same time the income change is recognized).

Initially under RCM, instructional RCs received the higher tuition paid by the non-resident students they enrolled. In 1992, this original configuration was changed so that all resident and non-resident undergraduate tuition went into a common pool and was distributed according to the total student credit hour numbers in each unit. The adjustment to remove the fee attribution differentiation between resident and non-resident students was accompanied by a shift in state appropriation so that each unit was “revenue neutral.” The reasoning behind this change was that teaching non-resident students "costs" a unit the same amount as teaching the same number of resident students.

At the urging of President Brand, the 1996 Review Committee sought a compromise position that would provide “appropriate incentives” for units to attract non-resident students. These non-resident students, it was argued, “frequently select a university largely on the basis of quality of a specific academic program.” As a result since 1997, in the event that the campus has incremental fee income resulting from additional non-resident students, those instructional responsibility centers that have increased their proportion of non-resident students share in that incremental income. All other undergraduate fee income continues to be pooled. Thus, additional funds have gone to those units whose percentage of non-resident student numbers increased.

Several other recommendations involved assessments in general and the assessments for specific non-instructional units. The report endorsed the general assessment methodology, but recommended changes in several cases. The recommended changes have been implemented.

Among the negative perceptions of RCM that the 1996 Committee reported receiving most often was “units paying the bills [instructional units] don’t have enough control over the way the non-instructional units are managing their operations.” As a result, the Committee concluded, “Although the general philosophy of using assessments to support non-instructional units should be maintained, there may be areas in which fee-for-service arrangements are appropriate.” This proposal has been discussed, but implementation is complex. Issues such as the loss of economies of scale in essential services and the lack of genuine alternatives for the user have constrained progress. Also, there have been two university wide initiatives focused on assessing the costs of administrative and other non-academic services. The first, a Task Force on Efficiency and Cost Reduction led by vice presidents Gerald Bepko and Terry Clapacs and Vice Chancellor Trudy Banta, submitted its report in the fall of 1998. In a cover letter to the Trustees President Brand commented that “we can be reasonably satisfied that the cost of operations at Indiana University is well within the range of costs that are typical at American Universities.” The second is the initiative launched early this year: a Review of Nonacademic Administrative Services. In his charge to the Task Force, chaired by vice president Judy Palmer, President Brand described the goals of the review as: “The primary purpose of this review is to recommend the means by which these [administrative] services can be provided more cost effectively and without loss of quality – or even better, with increased quality.”

This report is based on data covering enrollments, financial resources, allocations of state appropriation, and assessments. These data are collected and described in the attachments.

In addition, the report is informed by committee discussions of the issues raised in 33 interviews conducted with deans, directors, members of advisory and policy committees, and others who play an active role in administration and in formulating policy at IUB. These discussions focused on what these individuals believed the campus' financial management system should try to achieve and the success of RCM in meeting these goals. The protocol for these interviews is contained in Attachment 5. Committee members also interviewed administrators and faculty representatives from four other Big Ten universities that implemented, or considered implementing, RCM type systems. A list of individuals whose comments helped inform the Committee is appended as Attachment 4. In addition, the review committee widely distributed a notice of the review (included as Attachment 3) and held a public meeting to solicit comments and suggestions from faculty, staff, and students. Written reports of each interview and of the public meeting were circulated to the Committee.

· Strengthening the role of the Chancellor's Discretionary Fund in sustaining and enhancing quality and in supporting the campus ‘common good,’

· Refining the rationale used to attribute instructional fee income among responsibility centers,

The following features were mentioned most often in interviews and letters as being beneficial results of the RCM system:

· The Chancellor's Discretionary Fund has provided the opportunity to allocate base funds over time to sustain and enhance quality.

· RCM encourages more attention to mutually advantageous partnering opportunities.

· The percentage of out-of-state students has edged up in recent years because of increased academic quality and growing scholarship funds—both in part a product of the RCM environment.

· RCM encourages units to review inefficient or outdated programs, including a consideration of reduction or elimination, and when possible reallocate resources to higher priorities.

· The assessment system has helped non-instructional units strengthen their administrative structure to create the best services for the best price. It also allows non-instructional units to discuss and to determine more effectively what they should be doing and for whom.

· The assessment system encourages responsible (i.e., not uncontrolled) growth. When a unit increases enrollments and faculty relative to other units, it is charged higher assessments.

· RCM leads to greater transparencies in budgets. This has allowed the campus to better allocate its scarce resources in a time when the state appropriation plays a declining role in the resource base. It is the "size of the pie" that is the problem; RCM simply "slices up this pie."

· Under the previous system, deans and directors typically spent all funds allocated during a year even if those expenditures might not be the highest priority for the unit in the long run; budget conferences were totally focused on expenditures with the various units requesting funds to support projects, positions, and other activities. Under RCM, there is much more focus on planning, income generation, innovation, and entrepreneurship.

· RCM provides incentives for schools to monitor their performance with an eye toward increasing the efficiency and effectiveness of their operations.

· RCM makes units aware of student enrollments and the importance of meeting student needs.

· The Chancellor does not have adequate resources to fund quality improvement initiatives.

· RCM rewards the strong and creates the need for special attention to units that have limited revenue potential but are important to the mission of the campus.

· The autonomy of individual units raises the question of whether the sum of the individual parts creates a strong university. The RCM system appears to demand accountability only to the bottom line for each unit, not to the campus or university. A more effective mechanism is needed to insure that the priorities and agendas of individual units support the campus plan and goals.

· Instructional fee income smoothing, while providing planning time for units with declining enrollments, creates difficulties for rapidly growing Schools.

· RCM presupposes a linear relationship between student enrollments and instructional expenditures that does not exist. In addition, RCM does not sufficiently account for the tremendous disparity in the cost of instruction per student credit hour across disciplines.

· The mechanics of assessments need to be simplified and better targeted to actual service usage.

· Non-instructional units are insufficiently accountable for the use for their income—those who are subject to market discipline are not sympathetic to those who are not.

· The flexibility provided by RCM allows units to “get into financial trouble earlier and [into] more serious trouble” than under a traditional budgeting system. There is a need for stronger fiscal oversight so that the campus becomes involved more quickly in identifying and resolving financial problems.

· RCM creates a tension between the desire of both faculty and administrators to uphold quality and to maintain student enrollments. There is not necessarily a direct relationship between academic quality and student enrollments.

· Units that perceive they have benefited from RCM are its supporters; those who have been hurt oppose it.

The Chancellor's Discretionary Fund

The establishment of the Chancellor’s Discretionary Fund after the last review was universally supported in the interviews. It "has been great" and is described as "a good and necessary idea." The Chancellor’s Discretionary Fund is the campus' most potent safeguard against a "Balkanized" campus. Yet, many worry that "the greater good of the campus is probably not central enough, even with the Chancellor’s Discretionary Fund." These informants believe that "there needs to be more funding available for the fund." Interviews with financial officers and faculty from other Big Ten universities operating in an RCM environment indicate that it is common for universities to hold a larger percentage of funds for central allocation than has been done here.

A concern expressed about an increase in this fund was the impact such an allocation would have on already strained unit budgets. When RCM was implemented, it was assumed that annual increases in state funding would provide sufficient new revenue each year to permit both reasonable increases to the units and reasonable amounts for the Chancellor’s use. However, state funding has not increased as anticipated. After significant declines in inflation adjusted state appropriation per FTE during the initial five years of RCM, state appropriations (excluding fee replacement) have stabilized in the last five years and are up slightly in inflation adjusted terms. This small increase, though, has not been sufficient to relieve an extremely tight budget squeeze facing many instructional units.

While there may be occasions when it is appropriate to use these resources for a broader set of purposes, the committee endorses the basic principle that the CDF should be used to reward quality and to leverage campus priorities. Thus, the committee is concerned that in two of the four years that the Chancellor’s Discretionary Fund has existed, significant proportions of the Fund has been used to make across-the-board allocations to help units offset the budgetary constraints they face. The use of these one-time funds to cover base costs is weakening the CDF's ability to serve campus-wide initiatives for the “common good.”

Attribution of Undergraduate Instructional Fee Income

In the late 1990s, the Bloomington campus experienced large shifts in undergraduate enrollments among units and significant growth overall. Interviews with deans of units with declining or stable student enrollments suggest that the practice of "enrollment smoothing" has succeeded in providing their units with the opportunity to accommodate these shifts to a reasonable extent.

Enrollment smoothing, though, has created serious financial difficulties for units with sustained growth in student enrollments. The dean of a unit that had experienced "explosive enrollment growth" explained, "the lagging of revenue increases means that the unit must educate many more students without sufficient money to pay for new classes." These units bear the cost of providing instruction for additional students in the present year but must wait two years before fully receiving the increases in resources. For units with long-term enrollment increases, this is a particularly difficult situation since they continually face the higher costs of staffing more sections.

Currently, units with rapidly growing enrollments can access several one-time funding sources to meet these costs. These sources range from tapping their own reserve funds to negotiating a short-term loan from the campus to requesting additional funding from the Chancellor’s Discretionary Fund. Each of these steps, though, only moderates the impact of large, long-term enrollment increases. The consensus of individuals interviewed for this review is that IUB should provide more timely adjustments in the income generated by changing undergraduate enrollments.

A narrower issue that emerged from the interviews was the current status of second-eight-week courses for undergraduates. The current income attribution formula uses official credit hour counts from the end of the first week of classes to determine the distribution of credit hours taught, which in turn determines the distribution of instructional fee income. The majority of students in second-eight-week courses register after the first week and, thus: (a) are not included in the official credit hour data, and (b) generate no revenue for the responsibility center providing the instruction. Second -eight-week courses impose costs, though, on the units providing this instruction.

Since most late registrants for second-eight-week courses are paying a flat fee, their presence in these courses does not generate additional revenue for the campus to share with these units. However, there is evidence that the availability of second-eight-week courses provides real benefits to students and to the campus as a whole by permitting students who have dropped other courses during the semester to maintain a course load that allows them to qualify for financial aid and to make progress toward their degrees. These are important considerations in student retention.

Based on recommendations of the 1996 Review Committee, the campus has provided incentives for units to attract non-resident students. The current committee endorses the continuation of incentives for recruiting non-resident undergraduates since the attractiveness of a unit to non-resident students may be seen as an indication of the program’s quality.

Assessment System

Under the model of RCM established in Bloomington, non-instructional units receive most of their operating budgets from instructional units via assessments. Interviews uncovered four concerns with this assessment system. First, the assessment algorithm was almost universally viewed as "cumbersome and very difficult to understand on the part of the average person dealing with budgets." Second, deans of instructional units complained that the assessment levels generated by this algorithm have increased dramatically in recent years. Third, several informants question if assessments are the proper funding mechanism for all non-instructional units. Fourth, related to the assessment levels is the issue of how much accountability non-instructional units should provide to instructional units for the funds received.

During the last nine years, the assessment mechanism has been adjusted frequently in an attempt to make the fluctuations in assessments seen by the instructional units represent reasonable changes in response to actions that they have taken (e.g., increasing faculty, decreasing credit hours). Possibly as a result, there is often a sense of mystery about why assessments have changed from year to year. One dean states, "RCM's weakness is a lack of transparency in assessments," while another reports, "the bottom line (is that) the budget office must be fully trusted since there is a lack of understanding on the assessment calculations."

The difficulty in understanding assessments and their impact on the ability of academic deans to accomplish their goals is exacerbated by the fact that some of the expenditures in non-instructional units directly benefit academic responsibility centers. For instance, financial aid, library acquisitions, and academic equipment expenditures may be made through non-instructional units, but they are directly related either to income generation or the academic mission of the instructional units.

As Attachment 16 shows, once adjustments for these expenditures are made, the increases in support unit costs can be better understood. In 1999-00 (FY2000), the budgets of non-instructional units increased by $19.7 million or 9.4%. Over one-half of this increase is created by: a $3.5 million increase in the system service charge, a $3.4 million increase in undergraduate financial aid and a $3.0 million increase in debt service. Included in the system service charge increase is (a) $1.9 million in technology funding that included state revenue to pay for it (i.e., it was revenue-neutral), and (b) a fee courtesy arrangement cost of $690,000 that was simply an accounting change that shifted costs from the RCs to the university; no new costs were incurred. When you adjust the system service charge for these two exceptions, the increase falls to $900,000 or 4.3%.

Undergraduate financial aid is an investment made by IUB to generate additional tuition revenue that the campus would not receive in the absence of this investment. Thus, in a very real sense, the $3.4 million increase in undergraduate financial aid is less an increase in “non-instructional unit expenditure” than it is a “cost of doing business” for instructional units. Once adjustments are made for uncontrollable increases (e.g., debt service, utilities) and activities that are related to the academic mission of the instructional units, the budget increase for non-instructional units increase in 1999-00 (FY2000) falls to $6.5 million or 5.9%.

This increase in non-instructional unit budgets is still nearly triple the inflation rate (as measured by the CPI) for the fiscal year. Informants contend that growing assessment levels, over which the schools have little or no control (e.g., 18-20 benefit contingency, reserve replenishment, university tax), have weakened RCM. In addition, a sense exists that "tough choices that need to be made [about "whether some of these things should be funded at all"] . . . may be delayed or avoided through the device of continually increasing assessments."

A third concern expressed was whether assessments are the proper funding mechanism for all non-instructional units. Several informants believe that RCM should be changed to "fund the operation of certain campus-wide services (the Library for example) by taking funds costs "off the top" and distribute to schools only those dollars over which the Dean has a reasonable degree of control." The problem with having these resources flowing through the Schools’ budgets, according to this view, is that this system creates the illusion that these operations are taking money away from the schools.

The committee developed and reviewed a variety of different assessment approaches. Following a meeting with individuals from the Provost’s Office at the University of Michigan, which uses a ‘flat tax’ to fund non-instructional units, the committee discussed the desirability of using a similarly simplified system at IUB. The committee also reviewed steps other Big Ten universities have taken to fund some activities (e.g., Libraries) ‘off-the-top.’ The view of the committee remains that the current assessment mechanism, while complex, allows RCs to track the financial support they are providing to non-instructional units and tie the level of support to their faculty size or enrollments.

An additional concern is the issue of how much control the instructional units should be able to exert over non-instructional units to which they pay their assessments. Some instructional units believe "there is no mechanism by which academic RC units, which generate income for the campus, can exert pressure for accountability on units supported by assessments." Directors of non-instructional units sometimes feel that RCM limits the strength and quality of non-academic units that rely on assessments.

At a broader level, some observers charge that the current assessment system creates tensions across campus since it "encourages attention to costs and performance in the RCM units, but not necessarily in those units supported by assessments. . . .While some of these units have developed strong measures of accountability, others have not, with some evidence of sluggishness, inefficiency, and an institutional culture that is not receptive to incentive structures."

Units with Financial Problems

The interviews indicate a concern that the campus has not moved quickly and strongly enough to require units with financial problems to address them. In a particularly visible case, a dean questioned, “whether RCM was only for some and not for others.” The sense is that the current system depends too much on actions of Deans to take the initiative to address financial problems or to respond to campus suggestions and recommendations. Some believe the campus needs to be more intrusive when problems emerge.

Other Issues

The committee actively sought, and thoughtfully considered, criticisms of RCM. The overriding message of critics, as perceived by the committee, is that IUB is not as fiscally sound under RCM as it was previously. One task the committee faced, therefore, was determining if, and how, the implementation of RCM has contributed to a decline in campus welfare.

The perception of a large majority within the committee is that RCM was not the catalyst for many of the problems for which it is blamed. Rather, both RCM and what is perceived as a decline in campus welfare result from the same social and economic trends. The campus’ implementation of RCM was driven by a desire for greater flexibility that would allow schools to more rapidly respond to a changing higher education environment. This environment included historic economic changes and much greater subject specialization than had prevailed in previous decades. Changing enrollment patterns, such as a dramatic shift in majors from liberal arts to professional schools, are nationwide phenomena that are driven by similar economic and subject area changes. As one respondent commented, “changing enrollment patterns, and resulting loss of collegiality, are driven by parents and students not RCM.”

Clearly, the debate around RCM has sapped the morale of a sizable segment of the faculty. According to one critic, “the students want degrees, not quality; administrators say that student credit hours are what counts. This rhetoric creates the perception that we've lost our integrity." Interview comments from those informants who are most knowledgeable about RCM reflect a view that strongly diverges from the perception that RCM provides incentives for diluting the academic quality of courses. These individuals emphasize that the difference with RCM is not that it is enrollment-driven—“the university budgeting system has always been enrollment-driven”—the difference is that authority for fiscal decisions has been decentralized. This decentralization has made the same budgetary decisions “more transparent.”

Another critic called for the committee to provide “a concrete sense of what RCM means and what it has done. What are its benefits? How has the better planning that it supposedly provides improved the quality of the campus?” One of the most difficult tasks this committee faced was uncoupling the impact of RCM from the impact of sharply reduced (in inflation adjusted terms) state support and huge shifts in enrollment. A large majority within the committee concludes that RCM facilitated the ability of the campus to navigate through a decade that would have been even more difficult otherwise. RCM means that schools are responsible for their own budgets. Thus, it has changed the focus of deans from accounting for a fixed amount of revenue that had to be spent in ways decided at the campus level to planning for how they would finance programs managed at the school-level. In an era of diminished state support and rapidly shifting enrollments, a large majority within the committee believes the campus benefited from placing financial authority in the hands of those administrators who are closest to the action. RCM ‘improved the quality of the campus’ by allowing those who can best assess the threats and opportunities facing a school to develop the school budget. This encourages more risk-taking by individual units, more customer awareness, and more attention to partnering opportunities that can be to mutual advantage.

Another issue that the committee wrestled with at length was a widely-held view that an unlevel playing field exists for COAS because they have not extended the RCM principles down to the departments. According to this view, COAS effectively operates under the old budgetary system while other schools have been able to respond to student needs in a more efficient way. While there is evidence that, at least in some cases, units which extend the incentive structure of RCM into sub-units, benefit from that decision, the committee believes that each unit needs to determine its own ‘best way.’ Specific difficulties the committee perceives in ‘driving RCM down to the department level’ are greater variability in enrollments, the lack of personnel in departments to provide financial management services, greatly differing costs of instruction, and a lack of department visibility. However, there is value in deans continually reassessing the internal financial management structures of their schools and adjusting to changes in the environment when appropriate.

While the committee concurs with observers who highlighted the downside of the high profile RCM has on campus, we do not believe the system should be renamed in order to "eliminate the target, which will eliminate the problem." The next section outlines a series of recommendations that we believe will improve the ability of RCM to better distribute resources to facilitate campus goals. Changing the name of the budgeting system might lessen its role as ‘lightning rod’ but would create other public relations problems that the committee believes the campus should avoid.

Recommendation 1: A large majority of the Committee recommends that the current version of RCM be maintained, although with modifications.

Rationale 1: The Committee found a broad consensus among policy makers that RCM provides incentives for units to monitor their performance with a goal of increasing efficiency and effectiveness. It makes units aware of student interests and needs and students have benefited from improved course availability. In addition, the transparency of the budgeting process under RCM has enabled good use of scarce financial resources. However, the Committee also found a perception among some faculty and staff that RCM creates a tension between the desire to uphold quality and the incentive to maintain student enrollments. This perception is a basis for concern that the system may be one factor causing an erosion of the spirit of collegiality and cooperation that has been such a valuable aspect of academic life at IUB.

The Chancellor's Discretionary Fund

Finding 2: The Chancellor's Discretionary Fund is an important source of support for quality enhancements and the primary mechanism for maintaining a proper balance between School autonomy and the common good. However, the funds currently available for academic investment are inadequate to achieve its goals. To address this problem, the share of the state appropriation allocated to the Chancellor’s Fund should be increased. This task is difficult, though, in view of the budgetary reality of identifying a source of these additional funds that does not have an unacceptable impact on the instructional units.

Recommendation 2a: The Fund should be continued and renamed the Chancellor's Fund (CF).

Rationale 2a: The term ‘discretionary’ implies that the distribution of this fund operates outside the normal budgeting process. Both the Budgetary Affairs Committee and the Dean’s Advisory Committee advise the Chancellor on how these funds should be allocated. Since this fund is the primary vehicle for supporting new investments and campus-wide priorities, the committee believes the campus should highlight its importance by using the term Chancellor’s Fund.

Recommendation 2b: The impending drop in the temporary rate of increase in the University Tax used to fund the hospital merger provides an opportunity to increase the Chancellor's Fund. The 7 percent increases in this charge are planned to end in 2001-02, and although no funds will be released, this should be viewed as an opportunity to increase the CF. Specifically, the percentage of state appropriation allocated to the Chancellor's Fund should be increased on the following schedule:

Rationale 2b: The autonomy provided to instructional units by RCM raises the possibility that what the deans view as best for their individual units will be mistaken for what is best for the campus. The Chancellor’s Office has a vital role to play in taking a broader view of the situation than is available to individual deans and pursuing the larger interest of IUB. The committee is concerned that the present CDF funding level of 1.5% of state appropriation, which is the lowest percentage ‘held back’ among Big Ten universities operating with an RCM financial model, limits the ability of the Chancellor’s Office to appropriately undertake campus-wide initiatives or pursue a central agenda. In addition, individual units lack access to adequate investment funds for important initiatives that may pay for themselves in the long run, but require up-front financing. Thus, the committee recommends that the campus increase the CDF from 1.5% of state appropriation to 2.5% to enable the Chancellor’s Office to pursue a broader campus mission and more adequately fund quality improvement initiatives.

Finding 3: While RCM has been cited as a barrier to creating and sustaining cross-disciplinary, integrated programs across Schools, the Committee finds the reality to be very different. By making costs and benefits much easier to quantify, RCM fosters cross-disciplinary, integrated projects across Schools..

Recommendation 3: Given the importance of cross-disciplinary work, the Chancellor’s Fund should adopt as one of its specific priorities the provision of incentives to further foster cooperation across units .

Rationale 3: In the current academic environment, where much interesting and important work is being done in areas that are at the boundaries of traditional disciplines, the campus must continue to pay close attention to stimulating partnering opportunities across Schools. The Chancellor’s Office is in a unique position to see across disciplinary boundaries in ways that units may not. Thus, resources from the Chancellor’s Fund should be used to foster cooperative ventures across units that can advantage both the units and the campus.

Attribution of Undergraduate Instructional Fee Income

Finding 4: The RCM instructional fee income attribution methodology should provide timely access to income generated by changing undergraduate enrollments.

Recommendation 4: Undergraduate instructional fee income should be distributed on the basis of the distribution of credit hours taught in the previous year.

Rationale 4: The 1996 RCM Review Committee sought to limit the effects of shifts in student enrollments by using an average of the last two years’ enrollments to allocate undergraduate tuition. While this practice of "enrollment smoothing" has succeeded in providing units with more stable budgets, it has created serious financial difficulties for units with sustained growth in student enrollments. These units bear the cost of providing instruction for additional students in the present year but must wait two years before fully receiving the appropriate increases in resources. Based on the advice of the Dean’s Advisory Committee, the Review Committee recommends returning to a one-year lag in attributing revenue. The goal of this change is to provide more timely adjustments in the income generated by changing undergraduate enrollments.

Finding 5: The availability of second-eight-week courses provides significant benefits to students.

Recommendation 5: Late registrations for second-eight-week courses should be included in attributing undergraduate instructional fee income. The shift should be phased-in with second-eight-week credit hours weighted 0.3 in 2001-02 (FY02), 0.5 in FY03, and 0.75 in FY04.

Rationale 5: While late registrants (after the first week of the semester) to second-eight-week courses frequently generate no revenue, they impose costs on the units providing this instruction. Because the availability of second-eight-week courses permits students who have dropped other courses during the semester to maintain a course load that allows them to qualify for financial aid and to make progress toward their degrees, the availability of these courses is an important consideration in student retention. As such, these courses should be included in attributing undergraduate instructional fee income.

Assessment System

Recommendation 6a: The current method of indirect assessments should be continued.

Recommendation 6b: Assessment data provided to campus policy makers should include a clear explanation of how the assessments are determined and how the funds are used. Significant changes in non-instructional unit expenditure levels should be explained.

Rationale 6: Much of the complexity of the current assessment system is caused by indirect assessments. In order to fully account for the cost of non-instructional units, other non-instructional units are assessed to pay for their services. For example, the Library is charged an assessment to pay a portion of the costs of UITS. However, all costs of the Library, including such assessments, are included in the Library assessment charged to instructional units. The committee believes that the value of more comprehensive data available to instructional units by the indirect assessment process outweighs the disadvantages created by its complexity.

Non-instructional units currently provide these explanations in their annual budget conferences. This information should be shared widely with campus policy makers.

Finding 7: Health insurance for Student Academic Appointees (SAAs) is appropriate for direct charge.

Recommendation 7: Graduate student (SAA) health insurance should be supported as a direct charge (funded outside the assessment system). The charge should be assessed as a benefit charge on graduate student stipends. The change should be implemented in a revenue neutral manner.

Rationale 7: Graduate student health insurance is a cost of doing business for instructional units and is more appropriately included in their benefit charges.

Finding 8: The current Library assessment mechanism does not allow independent verification of how the assessment is determined.

Recommendation 8: The Library assessment should be distributed on the basis of total budgeted expenditures. The transition should be made revenue neutral by assigning different weights to each unit so that the final result is identical to what units would have paid without a change in the Library assessment. In subsequent years, these new weights should be used to distribute the Library assessment among RCs.

Rationale 8: The current Library assessment mechanism is based on “assigned” personnel, materials, and space costs. This recommendation allows instructional units to better understand the basis for their Library assessment.

Units with Financial Problems

Finding 9: Since the last review, there have been several instances in which units encountered financial problems. The reasons varied, and - while in any individual case were not directly attributable to RCM - may have been exacerbated by the environment of distributed decision making inherent in RCM. The campus should become involved more quickly in identifying and resolving such problems.

Recommendation 9: The Campus Budget Office should be proactive and intervene quickly when budgetary problems are identified. The campus should work with deans to identify and address problems in a timely manner, and verify compliance with the planned responses. In the most extreme cases, this will involve constraints on the school’s freedom to make financial decisions.

Rationale 9: The units experiencing financial problems would have experienced budgetary difficulties under the previous budgetary system. However, under the previous system, the Campus Budget Office would have become involved much earlier and to a much greater extent. RCM is intended to create autonomy for deans. While greater autonomy creates greater risk, it does not alter the campus’ responsibility to provide fiscal oversight. A large majority within the Committee applauds the autonomy provided by RCM; it recognizes the risks, though, and urges the Campus Budget Office to become involved more quickly, and more intrusively when necessary, in identifying and resolving financial problems.

Finding 10: As the leadership of responsibility centers changes, individuals who have not had experience with RCM may find challenges in planning and implementing financial decisions in this system.

Recommendation 10: The Campus Budget Office should continue and enhance RCM mentoring for all incoming deans. It should also continue and augment in-service workshops to upgrade the skills of school-level budget officers and other appropriate administrators. Among other topics, these workshops should (1) build the capacity for program budgeting and reporting, and (2) focus on campus income distribution policies so that (a) schools can appropriately incorporate these policies in their planning, and (b) the policies generate the incentive effects the campus intends.

Rationale 10: Autonomy presupposes financial sophistication. The Campus Budget Office must ensure that appropriate financial sophistication exists in all RCs.

Other Issues

Finding 11: The successive decisions to keep the impact of accounting changes “revenue neutral” by creating unit specific weights, but not equalizing them over time, also means that whatever inequities were built into any previous accounting system are not addressed, at least not in any systematic fashion.

Recommendation 11: The committee endorses the reactivation of the RCM Oversight Committee, with the initial task of reviewing all “revenue neutral” changes.

Rationale 11: Units that had external funding to cover operating costs or very low student faculty ratios before RCM had these features built into their share of state appropriations (negatively in the former case, positively in the latter). A similar situation may be created in library assessments by Recommendation 8.

Finding 12: RCM continues to be misunderstood by a broad segment of faculty and staff. This lack of information leads to problems because people tend to distrust what they don’t understand.

Recommendation 12: The Campus Budget Office and the Budgetary Affairs Committee should meet with faculty and others to increase understanding of what RCM means, how it compares with the previous system, its ramifications, its positive and negative aspects, and how the campus has attempted to keep the positive aspects while correcting the negative aspects.

Rationale 12: The committee experienced the same disjuncture as the 1996 RCM Review Committee. Those who are most knowledgeable about RCM generally believe that it works reasonably well. Those who are operating with less complete information are much more critical. If IUB is to build broader support for its modified form of RCM and address the on-going unease about its merits, more must be done to increase and broaden understanding of the system and how it enables the achievement of the academic values of the campus.

5. Concluding Comments

In 1996, when the previous review was conducted, IUB was the only university in the Big Ten using Responsibility Centered Management. In 2000, the Universities of Illinois, Michigan, and Minnesota also budget using their versions of RCM, and several other large state universities are in various stages of planning and implementation. Decentralized planning and decision making are now widely recognized as offering great benefits in higher education.

Primary among these benefits is the ability to address budgetary problems at the level closest to the action, where the information needed to respond to opportunities and cope with problems is most complete. An example cited repeatedly in our interviews is the reaction of deans to the inevitable mismatch between class sections scheduled and student enrollments. Only a school or college dean has the information to fully assess the implications of adding or deleting a section. The dean understands the costs and benefits from both academic and financial perspectives.

The RCM process also makes the budget more transparent to all involved and offers an opportunity for responsiveness to the needs of students and faculty. Information available to the deans, and through them to the school and college policy committees, and the Budgetary Affairs Committee gives a full picture of resources and needs. Each unit has the responsibility of weighing the alternatives and making an informed decision on which of the unit priorities are most important.

While other Big Ten universities have moved to embrace various versions of RCM, it has continued to be controversial within the faculty at IUB. There continue to be concerns about the apparent focus on the “bottom line,” an emphasis on “quantity” over quality, and a tendency to balkanize the campus. In addition to these concerns, which were expressed in 1996 as well, a number of those interviewed for this review expressed a concern that RCM has led to the financial squeeze facing the College and the School of Music. Each of these events was complex and resulted from a variety of decisions and the RCM environment may have delayed campus awareness of problems. Also, unit responsibility for generating the income assumed in budget construction, especially graduate fee income, contributed. However, to a large extent, problems with expenditures could have occurred in any budgeting system.

Independent of what budgeting system is used, IUB faces a number of major financial challenges. Several of the individuals interviewed pointed to the declining role of state appropriations as a major problem for the university. In the last decade, the total operating state appropriation per FTE has fallen from $6,300 to $5,300 (in 1999 dollars). At the same time, as noted earlier, the costs of operation, including assessments, have grown markedly. The campus faces an enormous challenge in raising faculty salaries to competitive levels and funding benefit costs, including the cost of the 18-20 program. While the state appropriation and 18-20 costs are not aspects of the RCM system, the Committee believes it is important to acknowledge them as major structural factors that every unit will have to manage.

RESPONSIBILITY CENTERED MANAGEMENT AT

INDIANA UNIVERSITY BLOOMINGTON

This memo will confirm your appointments as co-chairs of a Committee to review the Bloomington Campus version of RCM. In a time when there are expanding goals and expectations for IUB and constrained resources, it is crucial that we have a financial management system which provides appropriate incentives and which stimulates the effective use of resources. We adopted RCM with this in mind.

When RCM was introduced, it was anticipated that the system would evolve through modification, and that has been the case. A few modifications were made soon after implementation, others in response to recommendations of the Deans Advisory Committee and the Budgetary Affairs Committee, and several in response to recommendations of the 1995-96 review. It has been four years since that review and about three years since the implementation of recommendations coming from the review. It is appropriate to again evaluate the system that underlies our financial planning and management.

There are many matters to be considered, and the Committee should determine how best to proceed to achieve the general objectives. The following topics may serve as a useful starting point for the discussion:

C the goals of the IUB version of RCM and the system designed to achieve those goals,

$ opportunities to enhance the likelihood that IUB is more than Athe sum of its parts,@

$ results of the 1995-96 review and the changes introduced in response to the recommendations of that committee,

$ experiences at other universities which considered RCM type systems, why various decisions were made and the results,

By copy of this memo I am asking those on the attached list of Committee members to conduct the review. The Committee has my full support, and if there are ways I can assist your work, please let me know. Many thanks.

Vice President Gros Louis has appointed a committee to review the Bloomington Campus version of Responsibility Centered Management (RCM). When RCM was introduced in 1990, it was anticipated that the system would evolve through modification, and that has been the case. During the 1995-96 academic year, a previous RCM Review Committee analyzed this system and made a number of recommendations that were implemented beginning in 1997. We now have the experiences of nine full fiscal years, and it is appropriate again to evaluate the system that underlies our financial planning and management. This review will seek to identify and clarify the strengths and weaknesses of the present version of RCM and suggest possible improvements.

As part of its work, the Review Committee will interview deans, directors, members of advisory and policy committees, and others who play an active role in administration and in formulating policy. In addition, we are interested in comments and suggestions from other faculty and staff. You are welcome to write, e-mail (please include RCM in the subject line of your message), or call any member of the Committee by December 15, 1999. To make an appointment, please call Twanette Newton in the Budgetary Administration and Planning Office, 855-3565, e-mail: tnewton, or contact either of the co-chairs of the Committee. Members of the Committee are:

3. What do you perceive to be the strengths of RCM as a mechanism for distributing resources?

5. What are your unit's 2 or 3 major goals? For each goal, does RCM facilitate or impede you in meeting this goal? If RCM facilitates meeting this goal, how? If RCM impedes your unit, what could be done to improve it? Could you provide an example?

6. In addition to your unit's goals, are there campus-level or system-wide goals that this review should take into consideration? For each goal, does RCM facilitate or impede the campus or system in meeting this goal? If RCM facilitates meeting this goal, how? If RCM impedes the campus or system, what could be done to improve it? Could you provide an example?

7. On the basis of recommendations from the 1996 RCM Review Committee, the Bloomington campus (a) established a Chancellor's Discretionary Fund by diverting up to 1.5% of the state appropriation to the Chancellor to reward quality and leverage campus priorities, and (b) instituted a two-year weighted average lag between enrollments and distributions to "smooth income flows" and implemented differential distributions based on non-resident students. In addition, the 1996 Review Committee proposed the concepts of shifting the funding of non-instructional units from assessments to fee-for-service (e.g., paying BEST for assessment forms). Are you aware of these changes? How successful have each of these changes been? Should these initiatives be changed in any way?

8. If RCM is to be retained, what should be the local unit of financial decision-making (i.e., campus, school, department, individual faculty)?

9. Are you familiar with the pre-RCM financial management system? If so, what are your perspectives on its value relative to RCM?

Total Operating State Appropriation
(Excludes Fee Replacement)

Fiscal Year	Operating Appropriations	Change
1975-76	$59,719,774
1976-77	$61,943,266	3.72%
1977-78	$63,771,906	2.95%
1978-79	$69,021,152	8.23%
1979-80	$74,420,277	7.82%
1980-81	$82,792,569	11.25%
1981-82	$82,719,941	-0.09%
1982-83	$81,601,544	-1.35%
1983-84	$93,638,633	14.75%
1984-85	$100,600,215	7.43%
1985-86	$108,397,681	7.75%
1986-87	$116,387,502	7.37%
1987-88	$122,280,462	5.06%
1988-89	$132,124,068	8.05%
1989-90

RESPONSIBILITY CENTERED MANAGEMENT AT
INDIANA UNIVERSITY BLOOMINGTON

1990-2000

May, 2000

RCM REVIEW COMMITTEE, 1999-2000

Executive Summary

Report of the RCM Review Committee
Indiana University Bloomington
May, 2000

Responsibility Centered Management at
Indiana University Bloomington

Policies and Procedures Used Before RCM: Pre-1990

The Chancellor's Discretionary Fund

Attribution of Undergraduate Instructional Fee Income

Assessment System

Units with Financial Problems

Other Issues

The Chancellor's Discretionary Fund

Attribution of Undergraduate Instructional Fee Income

Assessment System

Units with Financial Problems

Other Issues

5. Concluding Comments

RESPONSIBILITY CENTERED MANAGEMENT AT

INDIANA UNIVERSITY BLOOMINGTON

Table of Contents

Units Goals

Other Unit Goals

Campus/System Goals

Assessment

Suggestions for changes

Total Operating State Appropriation

	Units Goals
	Where appropriate, please consider excellence in:
	Instruction	Research and scholarly activities	Service
For each goal, does RCM facilitate or impede you in meeting this goal?
If RCM facilitates meeting this goal, how?
If RCM impedes your unit, what could be done to improve it?

Recommendation	Assessment	Suggestions for changes
Chancellor's Discretionary Fund
Distribution of undergraduate fees
Shift to fee-for-service

Strengths	Priority

Weaknesses/Flaws	Priority

RESPONSIBILITY CENTERED MANAGEMENT AT INDIANA UNIVERSITY BLOOMINGTON

1990-2000

May, 2000

RCM REVIEW COMMITTEE, 1999-2000

Executive Summary

Report of the RCM Review Committee Indiana University Bloomington May, 2000

Responsibility Centered Management at Indiana University Bloomington

Policies and Procedures Used Before RCM: Pre-1990

The Chancellor's Discretionary Fund

Attribution of Undergraduate Instructional Fee Income

Assessment System

Units with Financial Problems

Other Issues

The Chancellor's Discretionary Fund

Attribution of Undergraduate Instructional Fee Income

Assessment System

Units with Financial Problems

Other Issues

5. Concluding Comments

RESPONSIBILITY CENTERED MANAGEMENT AT

INDIANA UNIVERSITY BLOOMINGTON

Table of Contents

Units Goals

Other Unit Goals

Campus/System Goals

Assessment

Suggestions for changes

Total Operating State Appropriation

RESPONSIBILITY CENTERED MANAGEMENT AT
INDIANA UNIVERSITY BLOOMINGTON

Report of the RCM Review Committee
Indiana University Bloomington
May, 2000

Responsibility Centered Management at
Indiana University Bloomington