BGSU Opportunity Assessment

October 4, 2013

Faculty and Staff:

As I shared with you last month in my State of the University Address, Bowling Green State University and higher education as a whole continue to face daunting financial challenges.

Simply put, our current operating model is unsustainable. With student debt on the rise, we cannot continue to raise tuition to cover our costs. While we are aggressively pursuing new sources of revenue, it is clear that we must significantly reduce our operating costs.

We currently estimate a shortfall of $3 million to $10 million over the next 2-3 years. This could be covered by generating more revenue, reducing expenses, or a combination of both. The broad estimate is due to a number of unknowns including: Fiscal Year 2015 funding from the state, changes in enrollment, and changes in retention. We will continue to refine our estimates throughout the fall semester as more information becomes available.

Over the last five years, we have made progress in reducing our operating costs. Most recently, the Efficiency Task Force I appointed identified a number of opportunities for operational efficiencies that we've already begun implementing. Additional opportunities for savings will be more difficult to identify, which is why we've secured outside assistance.

The University has contracted with Accenture, a worldwide management-consulting firm with extensive experience in higher education, to conduct an Opportunity Assessment.

Our ultimate goal is to develop a new, more efficient organizational design that helps us achieve large-scale cost reductions without jeopardizing our core mission.

To achieve that goal, the project has two primary objectives:

• Evaluate the current state of the University's operating structure.
• Identify and recommend measurable, attainable, and realistic opportunities to streamline operations both in the short term and the long term.

Accenture will begin its work next week and deliver an initial report with recommendations in December. I'll provide additional updates as we review the report and consider the recommendations. In the coming weeks, we'll also be providing more information on our website.

I understand that change can be disconcerting. It is important that we all be patient and all keep an open mind as we work through this process. It is my hope that this project will provide a roadmap to a much brighter future for our University.

Regards,

Mary Ellen Mazey, Ph.D.
President