University Budget Trimming: Consultant's Recommendations vs. Implementation

There is probably no more difficult an environment in which to conduct efficient procurement than a University. If you're a procurement practitioner in a corporate environment and frequently feel like Rodney Dangerfield, imagine trying to do your job efficiently without centralized management and with stakeholders who essentially own their jobs -- it's called tenure.

Having spent fifteen years negotiating and buying for a large Ivy in my early career, I was somewhat amused to see a recent New York Times column titled "Universities Turn to Consultants to Trim Budgets". And more ironic than amusing, the article reports that the consultancy of choice appears to be Bain & Company. Now without unduly criticizing Bain, they do have something of a slash and burn reputation when they move into corporations so I was more than a bit curious to read how they're approaching the decentralized University culture.

For the University of North Carolina the Times reports that "Bain & Company, came up with recommendations that it said could save the university more than $150 million a year. They included centralizing some of the university's widely dispersed procurement operations (up to $45 million) and information technology functions (up to $19 million) and simplifying its organizational structure (up to $12 million) ... and [have] examined business functions but stayed away from academic issues like courseloads and tenure." Hmm ... I wish Bain's university clients the best of luck with implementing their "recommendations".

William Busch

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