401 Golden Shore, 5th Floor Executive Vice Chancellor and Fax M E M O R A N D U M

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1 Business and Finance Benjamin F. Quillian 401 Golden Shore, 5th Floor Executive Vice Chancellor and Long Beach, CA Chief Financial Officer Fax M E M O R A N D U M DATE: February 28, 2011 TO: FROM: SUBJECT: Vice Presidents, Finance/Administration Benjamin F. Quillian, Executive Vice Chancellor and Chief Financial Officer CSU SYNERGY PROJECT UPDATE : Moving With Direction The CSU is one of the most efficient universities in the nation. Nevertheless, we must continue to identify new opportunities to increase the efficiency and effectiveness of administrative functions; particularly in the context of the reductions in state funding. This must be done in a manner that maintains the necessary support to the University s academic mission. The CSU Synergy Project has been established to create greater collaborations among the system campuses, reduce duplication of effort, and leverage the strengths of the campuses. In March 2010, the report entitled CSU Synergy Project Setting a New Direction explained the project, its scope, organization, challenges, and measures of success. Over the past year, significant progress has been made. The attached report, CSU Synergy Project Moving with Direction chronicles the progress of the synergy initiatives and identifies the challenges we face. I hope the project will be useful to you and your staffs as you strive to reduce costs and increase efficiencies. If you have questions or would like to discuss the Synergy Project in greater detail, feel free to contact Mike Redmond at (mredmond@calstate.edu) or me directly. c: Charles B. Reed, Chancellor CSU Presidents Chief Information Officers Human Resources Directors Chancellor s Office Executive Staff CSU Campuses Bakersfield Channel Islands Chico Dominguez Hills East Bay Fresno Fullerton Humboldt Long Beach Los Angeles Maritime Academy Monterey Bay Northridge Pomona Sacramento San Bernardino San Diego San Francisco San José San Luis Obispo San Marcos Sonoma Stanislaus

2 CSU Synergy Project Update Moving with Direction The California State University

3 Page 2 TABLE OF CONTENTS Synergy Update Overview Coalition Direction Achievements... 4 Transformational Change... 4 Common Financial System... 4 Virtual Computer Lab... 5 Common Human Resources System... 5 Spend Analysis... 6 Virtual Information Security Center Project... 6 Absence Management Self Service... 7 Data Center Discovery Project... 7 Virtual Network Operations Center... 8 Leadership Development Program... 8 Standardization Project... 8 Shared Services and Expertise... 9 Dispatch Consolidation/Coordination... 9 Shared Capital Project Management Services... 9 Injury and Illness Prevention Program Online Training Human Resources Professional Development Environmental Health and Safety Training Administration Disability Awareness Training/Cross Campus Collaboration Shared Workers' Compensation Administration Services Voice-Over-Internet-Protocol Shared Environmental Health and Safety Administration Services Geographic Space Planning Leveraging the Power of the CSU Travel Services Purchasing Card System Defensive Driving Fundamentals Purchasing Consortiums Job Order Contracting Collaboration Software Contracting and Procurement Services Internal Consultant/Shared Services Registry Use of Open Source Software Evolving Opportunities for Synergy Moving With Direction Appendix-Synergy Possibilities... 17

4 Page 3 Synergy Update 1 Overview The CSU continues to seek administrative efficiencies. The Synergy Project was established with the goal of broadly impacting how functions and activities are accomplished by campuses. Synergy efforts support core values encompassed within the University s Access to Excellence strategic plan, while maximizing investment in student and academic programs. The first report on the project was issued in March 2010 entitled CSU Synergy Project - Setting a New Direction. That report marked the intent of the University to set a new direction for itself. It challenged the University to face certain organizational and cultural factors that run counter to synergy and to draw on long standing values to operate in the most efficient and effective manner possible for the citizens of California. This update intends to inform the progress achieved and further challenge the University leadership to move with direction. Systemwide, over the last year, leadership has taken to heart this challenge. Campuses have achieved much with respect to identifying and capitalizing on specific opportunities, leveraging limited CSU resources and, lowering overall systemwide administrative costs. This was done while maintaining and improving operations. The following is a current look at the status of the CSU Synergy Project. 2 Coalition To date, the role of the Chancellor s Office has been to challenge, encourage, and facilitate synergy efforts. An underlying principle of the project encourages campuses to look for synergies among themselves and seek a coalition of willing those recognizing the mutual benefits of change. This strategy recognizes the unique needs of each campus, while preserving the distinct identity of each. Progressing in this manner, the CSU Synergy Project acknowledges this uniqueness which motivates support given to a campus by local community, faculty, and students. Without the support of these constituencies, only limited success would be possible. A notable achievement, by example, is the Virtual Information Security Center (VISC). This CSU Synergy Project led by the CSU Northridge Chief Information Officer (CIO) included the Chancellor s Office and seven campuses. The collaboration established a campus-based Administrative/Technical Service Center, which will significantly improve the efficiency and effectiveness of information security programs on all participating campuses as well as at the Chancellor s Office. The effort was driven by a need to manage costs and increase effectiveness, while saving resources. And, while it is not the intent of the CSU Synergy Project to centralize control of campus administrative activities at the Chancellor s Office, this has been deemed appropriate in limited instances. The Common Financial System (CFS) Project initiated in 2009 is a noteworthy achievement. Under the direction of the CSU Executive Vice Chancellor and CFO (EVC/CFO), the success of the CFS Project is the result of collaboration among the Technology Steering Committee (TSC), 1 CSU Chief Information Officer, the Sonoma State University Vice President and CFO, and the CMS Executive Committee. In addition, this effort was made possible through a coalition of campus Vice Presidents/CFOs, CIOs and other technical and financial experts working on campuses and at the Chancellor s Office. Overall, the project owes its success to the support of CSU Presidents. Without their direction, cooperation, and support, CFS would not have been possible. 1 The TSC is a consortium of campus Presidents who establish planning principals, frameworks, and strategic direction for the use of information technology within the CSU.

5 Page 4 3 Direction The direction set by the CSU Synergy Project incorporates the need to lower administrative costs and increase operational efficiencies and effectiveness. The overall effort results in making more funds available for academic programs. Administrative activities targeted by the project include, but are not limited to, accounting, budgeting, capital planning, design and construction, investment management, risk management, human resources, information technology, and financial reporting. Cost savings and/or improved operations are achieved through collaborative processing of transactions, creation of operating frameworks to support administrative synergies, streamlining processes through simplified and improved reporting and compliance requirements, and consolidation of costly and staff intensive activities through technology. Synergy opportunities often relate to administrative activities and processes that can be readily shared among campuses with little impact on factors that make campuses unique, such as sharing expert advisory services and technical specialists, consolidating common administrative transactions processing, and collaborating where required services have been commoditized. Over the past year and a half, opportunities for synergy continue to be analyzed and discussed among Chancellor s Office administrators, campus presidents, campus executives, subject matter experts, and university affinity groups. Much has been accomplished. Synergy efforts across the CSU have been significant. The number of CSU Synergy Projects implemented, however, is far less than actually possible. Factors contributing to the gap in achievement include the lack of standards for the governance of the synergy process. The support of campus executive leadership is often unclear. Further, synergy opportunities have not been prioritized and requirements to collect metrics/data regarding cost savings and increased efficiency have not been established. 4 Achievements Following is a summary of various CSU Synergy Project efforts in process within the CSU. Some projects have been implemented, while others are still being evaluated. These efforts represent the broad range of the CSU Synergy Project possibilities and evidence the rich potential for change in how administrative processes and function are delivered within the CSU. Transformational Change Transformational change is defined as a shift in the culture of an organization resulting from a change in the underlying strategy and processes that the organization has used in the past. Change must be inspiring, pervasive and requires time to meet final objectives. The following examples represent Synergy and transformational change in the CSU. Common Financial System The CFS project demonstrates the CSU s commitment to achieving administrative synergies systemwide. The intent of the project is to make available, for all campuses and auxiliary organizations, a single financial system application and consolidate all data within a centrally maintained single database. The CFS was prototyped by a small group of financial and technical experts. The resulting application was an enriched, common baseline application built upon the Common Management System (CMS) financial application used by Cal Poly San Luis Obispo. The application and related databases (including a

6 Page 5 systemwide data warehouse) is presently in use on a limited number of campuses and remaining campus conversions are progressing as intended. Campuses are currently working together to add certain system enhancements to the application. As campus financial systems were previously configured, this effort might have been repeated at each campus. This is illustrative of the significant cost savings that will occur going forward. To date, the change in processes associated with implementing the CFS has reduced expenditures by over $10 million. Post implementation, a reduction in costs is estimated at over a million of dollar annually. The project is sponsored by the EVC/CFO and the Chancellor s Executive Council, initiated by Chief Administrators and Business Officers (CABO) and Information Technology Advisory Committee (ITAC) and led jointly by the Sonoma State University Vice President of Administration and Finance, the CMS Steering Committee, and the systemwide CIO. Success is attributed to the CFS Design Team, Systemwide ITS Leadership, and the financial and technical staffs that are making it work on their campuses. Virtual Computer Lab The Virtual Computer Lab s (VCL) objective is to provide virtual application lab services to all CSU campuses permitting anytime/anywhere access for students, thus reducing the number of physical application labs on campuses. Successful pilot installations are in production at the CSU East Bay and Northridge campuses and system enhancements are planned. The Fullerton, Chico, Monterey Bay, and San Francisco campuses are ready to configure and pilot VCL installations for their campuses. Additional installations are being considered at CSU campuses: Dominguez Hills, Humboldt, San Luis Obispo, and San Jose. The VCL project allows participating campuses to limit further investment in lab workstation hardware. Future savings for the CSU potentially could be in excess of a million dollars annually systemwide if campuses decommission existing physical labs. The project is sponsored by the Technology Steering Committee (TSC), initiated by the ITAC, and led by San Francisco State University. Common Human Resources System The Common Human Resources System s (CHRS) objective is to provide a single HR application and consolidate all data within a centrally maintained single database. Similar to the CFS project, the CHRS project is an opportunity for CSU to achieve administrative synergies systemwide. Recently a strategic task force comprised of Human Resources Officers, Academic Vice Presidents of Faculty Affairs, Provosts, CMS and Systemwide Human Resources management was formed to determine scope for the project and develop a Feasibility Study Report. The Feasibility Report will address how the project can be accomplished including the identification of potential cost savings. Data collection efforts are now underway to assess the use of technology throughout the CSU. Campuses and the Chancellor s Office are working to provide information on their existing campus-specific modifications, use of third-party systems and use of non-core CMS functionality. In addition, a special work group led by members of the task force was formed to assist in assessing and collecting information regarding the specific technology needs related to faculty affairs.

7 Page 6 It is anticipated there may be a one-time initial cost to implement CHRS, preliminary cost savings will result from the reduction of ongoing Human Resource systems development and maintenance.. Savings resulting from the reduction in campus upgrades (over a four year period) are estimated to be over seven million dollars. CHRS is sponsored by the Vice Chancellor for Systemwide Human Resources and planned with the support of the CMS Executive Committee and Systemwide Information Technology Services. Spend Analysis Better understanding of metrics of CSU procurement, spend and payment will drive business and operational decisions related to improving purchasing, payment and systemwide contracting in the future. While the CSU has a central office procurement function, procurement has remained largely locally controlled. Campuses have a history of joining together to obtain better services, products, and prices through group purchasing. CABO is taking a detailed look at campus spending trends with the intent of capitalizing on opportunities for saving through a collaborative spend analysis process. To date, campuses collaboratively have created data queries and are evaluating commercial consortiums that connect multicampus data with vendor pricing inquiries to measure opportunities and to collect useful analytics. Assuming an aggressive utilization of spend analysis information and appropriate modification of campus buying practices, the CSU stands to reduce spend by significant amounts systemwide. Virtual Information Security Center Project The Virtual Information Security Center (VISC) provides a set of Information Security services for participating campuses that are typically provided by the campus Information Security Office and staff, including information security risk management, incident management, standards/procedures development, monitoring, and information security product evaluation. The VISC is a virtual organization comprised of staff residents, on multiple CSU campuses, that operate under a uniform governance and management structure. Operations of the VISC are overseen by an Information Security Officer (ISO). The VISC priorities, operational plans and service levels are approved by a governance group comprised of the CIOs of the participating campuses. The VISC benefits campuses in several ways. For those currently fully staffed with information security professionals who provide a full range of services to their campus, the VISC provides an opportunity to reduce costs by leveraging the economies of scale of the Center. For campuses not able to offer the full complement of required security services (due to budget or staffing constraints), the VISC provides a more cost effective means to close the gap between required and offered services. Long-term, the VISC offers the CSU a way to curtail the growth of information security costs (assuming a fairly constant regulatory and risk environment) by pooling expertise and leveraging technology to perform tasks common to all campuses. Savings ultimately come from cost avoidance plus potential cost savings by leveraging the economies of scale. The project is sponsored by the TSC, initiated by the ITAC and led by the CSU Northridge CIO. Participating CSU campuses include Bakersfield, Channel Islands, Dominguez Hills, East Bay, Fullerton, Monterey Bay, Northridge, and the Chancellor s Office.

8 Page 7 Systemwide Identity Management Through a multi-year collaborative effort, all the CSU campuses are now implementing the Shibboleth standard for Web single sign-on. By adopting Shibboleth, joining the InCommon Federation, and by adding the calstate.edu attributes to their directories, all CSU campuses are now supporting a common framework for trustworthy shared management of access to online resources, thus positioning the system for further technology synergies. The Identity Management system enables operation of cost avoidance systemwide synergy projects such as the CFS and the CHRS, as well as a myriad of similar shared opportunities. Absence Management Self Service The Absence Management Self Service (AM-SS) time and attendance reporting system was the first synergistic systemwide, common, custom-built application to be implemented by all CSU campuses and supported in CMS. The business requirements for the design of the module were developed based on best practices identified by campus Human Resource Officers with input from campus human resources and payroll experts. The AM-SS module was released in June 2010 and has been implemented by the Chancellor s Office, CSU East Bay, CSU Fresno and Sonoma State. Several CSU campuses (Bakersfield, Chico, Fullerton, San Francisco, and Stanislaus) are presently implementing AM-SS, and all remaining campuses are expected to implement the system by the end of the calendar year. As the CSU continues to move forward to implement common applications, cost savings associated with improving administrative functions and the removal of system redundancies are expected to be achieved and documented. The project is sponsored by the Vice Chancellor of Systemwide Human Resources, with support from the CMS Executive Committee. Data Center Discovery Project The Data Center Discovery Project (DCD) seeks to optimize and streamline the collective CSU data center environments. The primary objective is to evaluate options for increasing the efficiency and effectiveness of data center operations. Surveys have been launched to develop a snapshot of current data center resources and their utilization throughout the system, including facility and application inventories. The DCD seeks to leverage new data center technologies and lower related facility and energy costs. Significant savings can be expected through virtualization efforts and/or migration to a cloud server environment. The project is sponsored by the TSC, initiated by the ITAC and led jointly by the CSU Channel Islands CIO and the systemwide CIO and his leadership team. Eventually, all campuses could benefit from this effort.

9 Page 8 Virtual Network Operations Center The Virtual Network Operations Center (VNOC) is a pilot project seeking to validate the feasibility, effectiveness, and potential savings of a collaborated networking control center. Campuses participating in the VNOC receive or provide basic network monitoring services. A standard suite of networking tools has been identified and deployed during the pilot project. Initial estimates indicate cost savings are realized through standardization of network tools, and processes, and redirection of staff to other network tasks other than network control and monitoring. The project is sponsored by the TSC, initiated by the ITAC and led jointly by the CSU East Bay CIO and the Systemwide CIO leadership team. Leadership Development Program CSU Fullerton has developed and implemented a comprehensive Leadership Development Program (LDP) to provide campus leaders (with experience of five years or less) with an applied understanding of contemporary leadership concepts, tools, and strategies. The objective of the program is to enhance the knowledge and core competencies best suited to ensure individual leadership success and the advancement of the University. Fullerton shared its program structure with CSU campuses Fresno and Bakersfield. CSU Monterey Bay, in turn, joined Fresno and Bakersfield in a synergy partnership to establish their own leadership program Regional Education Achievement in Leadership (REAL). The primary goal is to create a high quality training program that otherwise would have been difficult to develop by a single campus. The collaboration lowered individual campus costs for the program; equally important, the program established collaborative bonds between campuses. Multi-campus collaborative leadership programs like REAL greatly could increase identification of opportunities for synergy. Standardization Project Systemwide Human Resources is leading a Synergy Project to standardize HR business processes and practices to maximize information and reporting consistency and uniformity to optimize administrative efficiencies intended from the implementation of CHRS and the SCO s MyCalPAYS state payroll system project (formally referred to as the 21 st Century Project). Standardization activities involve changes to a number of HR system-related structures and applications, such as the official employment roster; synchronization (and documentation) of processes that require coding and coordination between the current state s Personnel/Payroll Information Management System and MyCalPAYS and CSU systems. Additionally, numerous other processes pertinent to employment history and payroll processing will be standardized. The effort will improve the CSU s ability to ensure that employee demographic and job-related data are captured in compliance with state and federal laws. The project will require collaboration among all campuses as it affects all HR databases. Savings will be gained from operating efficiencies and reduced system conversion costs.

10 Page 9 Shared Services and Expertise The advice and services of specialists and experts are essential to the successful operation of any entity, public or private. The following represent Synergy and sharing services and expertise among CSU campuses. Dispatch Consolidation/Coordination Several Synergy initiatives are underway concerning dispatch services throughout the CSU. Dispatch services are an essential component in the university police department s service to a campus. Dispatch units receive emergency calls, determine the nature and location of emergencies, determine priorities, and dispatch police, fire, ambulance or other emergency units as necessary and in accordance with established procedures. CSU Monterey Bay has outsourced its dispatch center to a local police agency during the department s start-up phase, resulting in department savings of staffing and equipment costs. CSU San Bernardino recently contracted with a local community college to provide dispatch services for the district, resulting in revenue to the campus and an offset of related costs. San José State University has contracted with a local college to provide dispatch services for their police department, resulting in revenues to the campus and an offset of related costs. The contract is being reviewed for renewal. CSU Stanislaus has initiated an agreement with a local police agency to duplicate its dispatching operations on campus. The results are shared dispatch services, the elimination of night staffing on campus, and the establishment of redundancy in dispatch centers in case of a disaster or major emergency. This resulted in cost savings due to staff reductions. In some cases, the additional revenues allowed for funding of existing or additional staffing needs. Humboldt State University has initiated an agreement with a local police agency to duplicate its dispatching operations. Police chiefs at California Maritime Academy and CSU East Bay are actively identifying needs and logistical challenges to consolidate their dispatching needs for patrol operations. The guiding objective of such efforts remains to improve the delivery of services and not simply to reduce costs. Significant cost savings have yet to be achieved. However, considerable increases in the quality of services have been fulfilled. Shared Capital Project Management Services The Cal Poly Pomona campus has received authority to develop and construct a new facility on the campus. Pomona administrators located available staff at the CSU San Marcos campuses that possess the expertise necessary to oversee the project. As a result, a San Marcos capital projects manager will oversee and manage the architectural and various engineering firms selected for the planning and design of a new student service facility for Pomona. The capital projects manager will coordinate the work of in-house project managers and oversee the efforts of the Project Advisory Groups through direct interaction and campus engagement towards the completion of a Feasibility Study that will include space programming, conceptual plans, and cost estimating.

11 Page 10 Several similar efforts have been initiated across the CSU: Capital Planning, Design and Construction (CPDC) and CSU Chico are sharing a CPDC university architect. The CO administrator acts as campus deputy building official for code enforcement and oversees campus project management during the design phase. CSU Fullerton has submitted a proposal to manage all phases of a Bakersfield capital project. These agreements are still being evaluated. Benefits accrue as projects are overseen by an experienced and highly trained project manager knowledgeable in the CSU capital development process, and from eliminating the need to hire additional staff for the project. Injury and Illness Prevention Program Online Training The IIPP (Injury and Illness Prevention Program) is a collaboratively developed online training program intended to meet state and federal requirements mandating injury and illness prevention training. A synergy group was formed by Systemwide Professional Development (SPD) and CO Risk Management. CSU Sacramento provided the content document and coordinated the course review with senior Environmental, Health and Safety (EH&S) directors. Campuses now have a standardized and branded CSU course accessible from campus websites, including a learning management system (LMS.) Alternatively, campuses can send employees directly to the SPD website to take the IIPP training at their convenience at no expense to the campus. The course can be used as developed or can be individually modified by campuses, as needed. Cost savings are recognized by eliminating a duplication of effort for training that must meet prescribed standards and by making training available year-round to all employees. Human Resources Professional Development Operational and functional staffs have limited opportunity to discuss transactional and strategic issues within the Human Resources function. CSU Northridge has provided regional Human Resources Training to its staff and adjacent campuses to identify best solutions to common issues in an attempt to find ways to streamline operations, reduce time, and improve consistency of results. Presently CSU campuses Los Angeles, Dominguez Hills, Bakersfield, and Cal Poly San Luis Obispo have collaborated with Northridge. Northridge has absorbed the costs to host and present the meetings. Benefits to the program are difficult to measure in dollars, but the value of improved processes and results of human resources operations are clear. Environmental Health and Safety Training Administration CSU Fullerton currently uses a web-based application to track environmental health and safety training requirements. The system provides automated notifications to staff and supervisors, and tracks training until completion. This process has proven invaluable for regulatory inspections, accident investigation, and audits. CSU Fullerton plans to work with other campuses to share services and costs.

12 Page 11 Cost savings would result from reduced regulatory fines, a higher level of customer service, and technical support gained from shared use. Disability Awareness Training/Cross Campus Collaboration San José State and Humboldt State have collaborated to implement an online disability awareness training program created at Humboldt. The campuses worked together to update and modify the program. Humboldt staff, acting as facilitators during San José s implementation of the program, plan to offer support/guidance to other campuses as requested. Benefits include some cost savings and shared knowledgeable and experience expertise. Shared Workers' Compensation Administration Services CSU Dominguez Hills has entered into a synergy agreement with CSU Fullerton for the services of an employee that is a technical expert in the area of administration of the workers compensation program. The Fullerton administrator actively manages pending cases and plays an active role working with managers to allow capable employees on worker s compensation to return to work in some capacity. The Fullerton administrator also coordinates with the CSU third party workers compensation administrator to stay current on all cases. The overarching goal of both campuses is to settle/resolve outstanding employee claims in a timely manner. Under this current arrangement, the manager may stay focused on workers compensation claims and service to employees. Cost savings result for both campuses as consistent efficient and effective processing of claims is achieved from allowing the manager to be focused on area of expertise. Voice-Over-Internet-Protocol Voice-over-internet-protocol (VoIP) services utilize existing campus network access to place and receive telephone calls at a lower cost. Additionally, various useful capabilities are available through VoIP networks, including message interface with systems. California Maritime Academy is working with CSU Sacramento to share use of the campus VoIP system. New opportunities for broader consolidation of VoIP services have recently been offered through the Corporation for Education Network Initiatives in California commonly known as CENIC. The Chancellor s Office is evaluating this opportunity. A campus effort to collaborate implementation of VoIP or similar services lowers costs and improves functionality and services. Shared Environmental Health and Safety Administration Services Presently, Northridge and Monterey Bay campuses are exploring shared Environmental Health and Safety services. The Monterey Bay director of Environmental Health and Safety recently retired and both campuses are currently evaluating the feasibility of shared expertise. Benefits could result from the sharing of an experienced and highly trained technical manager knowledgeable of CSU activities and function and from eliminating the need to hire additional staff.

13 Page 12 Geographic Space Planning Humboldt State University has developed a geographic information systems (GIS) interface to the AutoCAD drawings of the campus building and floor plans. The major benefit of the resulting combined system is the ability to view space by Higher Education General Information Survey (HEGIS) department, space type, or size, by building or any combination thereof. As a planning tool, the system has proven to be highly effective. For new projects, the system greatly simplifies the need to quantify space by HEGIS or Department and compare it to the proposed space. Several campuses are considering implementing the application developed by Humboldt. This system is undergoing evaluation as a potential synergy opportunity. Savings could stem mostly from more efficient and effective use of staff time. Leveraging the Power of the CSU Large organizations can achieve operating and spending power based upon their size and position in a market. The following represents both synergy and levering the power of the CSU. Travel Services Systemwide travel is a necessary and costly component of CSU operations. To better manage related costs, the CSU has joined together with the University of California (UC) to procure and manage travel. The UC has created a travel system used for its employees that meets the majority of CSU needs. A successful pilot project was deployed and the CSU plans to broadly implement the joint system. Already, training is underway. If fully implemented at all twenty-three campuses and the Chancellor s Office, a million dollars or more in costs could be avoided systemwide annually from discounts received from the combined purchasing power of both university systems. Operational efficiencies would result from related automated processes and systems as well. The Travel Services Synergy Project was sponsored by the EVC/CFO, initiated by CABO, and led jointly by the CSU San Bernardino Vice President of Administration and Finance, and the Assistant Vice Chancellor, Financial Services. Purchasing Card System The CSU purchasing card (pcard) system provides a best practice approach to managing and controlling purchases made by employees on behalf of the CSU. The pcard system also allows campuses to increase efficiency in traditional vendor paper check payments by directing payment transactions through the pcard bank. Other pcard related products and benefits are available under the contract such as corporate and personal liability travel cards, fleet cards, ghost cards, travel insurance and accounts payable analysis. The CSU's contract with the bank was competitively established by the CSU in spring of 2010 through a nationwide RFP which sought synergies with other colleges and universities by combining the volumes and resources of the CSU and Indiana University. In the first six months of operations, the contract has been expanded to double the original size with other universities and government entities joining. All participants benefit through greater efficiencies of the program products, detailed spend diagnostics and from continuing growth in contract rebates.

14 Page 13 The CSU will see a growth in rebates in the current period of approximately a quarter million dollars for a similar spend volume. An entire range of benefits for a pcard program is possible. Campuses working collaboratively to develop the opportunities of the program could reduce expenditures over $300,000 in the current fiscal year and well over a million dollars for the first three years of the contract. Defensive Driving Fundamentals To comply with the CSU Vehicle Use Policy employees are required to complete a CO approved defensive driving course once every four years. For many years, each campus has absorbed the cost of developing practices, programs and methodologies to meet the requirement. A Synergy group (including individuals involved in environmental health and safety, police services, risk management, and SPD) was brought together to explore how this process could meet important objectives, yet limit staff time required to develop a systemwide training solution available for all campuses to access. This collaboration resulted in the purchase of a 60-minute online learning course at a cost annually of a nickel per employee. This price includes use of a LMS to document training participation and certification. Employees can access the course at their convenience eliminating the need to sit in a classroom for up to four hours of training. Initial estimates indicate that over $100,000 in costs can be avoided annually, when the program is implemented system-wide. Purchasing Consortiums The state s Department of General Services operates a Natural Gas Service program that monitors the gas commodity market, and manages a gas procurement portfolio with a blend of short term and long term purchases based on market conditions and price and production forecasts. CSU has been in the program for 15 years and is signed on to participate through Nineteen campuses participate in the program which is coordinated by CPDC. Currently, campuses using more than 250K therms of natural gas per year are eligible to purchase gas through DGS. Seeking synergy with the state saves campuses 15% annually on their natural gas costs. The CSU and the UC are joining together to reduce energy costs. Presently, they are evaluating the creation of a joint power authority to procure natural gas because of concerns that this DGS program may be eliminated. For both economic and environmental reasons, the CSU and the UC are also evaluating the benefits of membership in the Northern California Power Agency to facilitate strategic procurement of electricity systemwide. Combining the energy purchasing power of the combined university systems could save each system millions annually. To create economies of scale, CSU Fullerton has collaborated with several CSU campuses and UC Los Angeles to procure mattresses for student housing projects through a reverse auction. This methodology enables vendors to bid against each other in an effort to continuous lower the overall price until the auction is closed. Participating campuses include CSU Los Angeles, CSU Monterey Bay, Cal Poly Pomona, and Cal Poly SLO. The group plans to work with a purchasing consortium to identify and qualify suppliers that can furnish and install mattresses for residence halls. Presently the CSU campuses and UCLA need over 6,000 mattresses. Savings from the reverse option is expected to be significant.

15 Page 14 Job Order Contracting Job Order Contracting (JOC) is a way for campuses to get numerous, commonly encountered construction projects done quickly and easily through multi-year contracts. JOC reduces unnecessary levels of engineering, design, and contract procurement time along with construction project procurement costs by awarding long-term contracts for a wide variety of renovation, repair and construction projects. Capital Planning, Design and Construction (CPDC) at the Chancellor s Office has issued an RFP for emergency job order contracting; one contract each soon will be issued to northern campuses and southern campuses. This effort will improve CSU readiness to address emergency repairs and follow-up renovations and control costs. CSU East Bay and San José State are joining together to share a JOC contractor while CPDC has utilized a CSU Fullerton JOC contractor. The CSU Northridge and CSU Channel Island campuses sought synergies through the coordination of job order contracting agreements between the campuses. Northridge will bid JOC agreements with a provision allowing Channel Islands to be included in the contract. Cost savings will result from reduced administrative staff time requirements for RFP development, bidding and contract oversight. Collaboration Software San Francisco State is partnering with the Chancellor s Office for document management and collaboration as well as project and portfolio management, using collaboration software. The Chancellor s Office is hosting the software environment for San Francisco State and has provided system administration and deployment expertise. Staff, consulting and hardware expenditures were significantly reduced by sizing hardware requirements for combined usage and joint deployment of a major application upgrade (versus building separate systems.) Disaster Recovery Failover Sites San Francisco State and CSU Fullerton are in the process of implementing reciprocal data center disaster recovery sites. In the event that adverse events cause disruption to data center operations on one campus, essential services (such as ) will be provided via the reciprocal campus. Benefits from this project include improved organizational resilience through continuity of critical IT services, without the cost that would be incurred by contracting with commercial services for backup sites. Contracting and Procurement Services Internal Consultant/Shared Services Registry A principle opportunity identified within the CSU Synergy Project objectives is to look for opportunities to share experienced and knowledgeable staff between campuses. CABO and the CSU Procurement and Support Services Officers Association working with the ITAC have developed a registry of teams of internal consultants on various campuses who specialize in particular commodities and services and are available to help other campuses.

16 Page 15 Cost saving will result from forgone consulting and hiring. This shared services registry, sponsored by the EVC/CFO as a Synergy Project, was initiated by CABO and led by the Maritime Academy Vice President Administration and Finance and CFO. Use of Open Source Software Open-source refers to computer software that is available in source code form which does not require a software license. Often open source software is developed in a public, collaborative manner. Programmers and users can study, change, and improve the underlying code. Presently, CSU CIO s are looking for opportunities to utilize open source software: The Kuali Foundation is a non-profit corporation that coordinates the development of free/open source administrative software. San Francisco State University and other CSU campuses have joined the Kuali Foundation community of universities in order to use the Kuali Ready application for continuity planning hosted by UC Berkeley. Drupal is a free and open source content management system broadly used in the development of websites for various governmental, non-profit organizations, etc. San Francisco State is collaborating with CSU Monterey Bay and other California universities to share knowledge and resources on Drupal projects for Web content management. The use of open source software, when effective, lowers the cost of applications as compared to using licensed software. Evolving Opportunities for Synergy Various significant Synergy efforts are taking shape. These efforts represent the initial stages of transformational change. Shared Online Learning System The TSC is currently investigating the development of a shared online learning system. The committee is looking at opportunities/alternatives available to the system for expanding its involvement in online learning. Funding/revenue generation models associated with alternatives are to be evaluated as are timelines for implementation of alternatives. Implementing a LEAN campus CSU Fresno and CSU San Bernardino are piloting efforts on each campus to identify efficiencies and internal synergies utilizing the University of Central Oklahoma s LEAN University approach. This has involved organizational self-assessment to identify and analyze critical performance and other data seeking opportunities for improvement. Coinciding with these efforts, the Chancellor s Office, in conjunction with a NACUBO Excellence in Higher Education (EHE) grant, is working with both campuses and others in the CSU, lending expertise in implementing improvement through the EHE model, where applicable.

17 Page 16 Parking Ticket Management A long-standing example of multi-campus synergy achievement is the Parking Management Bureau managed by CSU Stanislaus. Using software developed by IT at Stanislaus, the campus police department manages parking ticket processing, fines, and disputes for six CSU campuses (Bakersfield, Channel Islands, Chico, East Bay, Maritime, and Monterey Bay) in addition to Stanislaus. Presently, the campus seeks to expand services to other CSU campuses, and educational and municipal entities. Doing so will enable further improvements to existing systems increasing the efficiency and effectiveness of parking management for all CSU entities participating. Web Help Desk The Web Help Desk project is an investigation into help desk service models that employ a centrally managed infrastructure with distribution of subject matter experts. San Francisco State University is assessing the Open Source Help Desk and IT Service Management Solution as a campuswide ticketing and change management system that could be made available for replication on other campuses, and could potentially be expanded for intra-campus projects. Technology Transfer A need has been established systemwide to improve and expand opportunities for sponsored program technology transfer within the CSU. Presently, a group of subject matter experts are exploring possible synergies that could be gained if related services were provided in regional centers rather than having centers developed individually on each campus. Campus Services CSU Bakersfield is seeking opportunities to coordinate certain print shop services with other campuses. Discussions have begun with CSU Fresno. 5 Moving With Direction The scope of the CSU Synergy Project initially focused on administrative and financial activities and functions. Various constituencies, however, have expressed interest in project outcomes. As the project moves forward, the door is open for their contribution. CSU system and campus leadership support the project and are seeking opportunities within the scope of their operations. Through these collaborations, significant success will be achieved.

18 Page 17 6 Appendix-Synergy Possibilities As described in the update, Synergy efforts across the CSU have been significant. However, the number of CSU Synergy Projects implemented is far less than actually possible. The following is an initial compilation of opportunities included within the CSU Synergy Project Setting a New Direction March This initial list demonstrates the broad range of CSU activities that can benefit from Synergy. A. Information Technology Shared Hosting of Commonly Utilized Academic and Administrative Applications; Establishing an Administrative Service Center to host learning management systems for multiple campuses, consolidating efforts to control and manage the application Shared Hosting of Network Based Virtual Meeting Tools; Establishing Administrative Service Centers or a Systemwide Administrative Service Center to coordinate operation of web based application services Collaborative Design, Build, Delivery and Maintenance of Secure Web Services; Forming Campus Administrative Partnerships, Technical Administrative Function Associations or Administrative Service Centers to enable better control over unauthorized access, disclosure of configuration vulnerabilities, etc. at a lower cost. Implementation of Virtual Academic Laboratory Experiences; Creating Administrative Service Centers to virtually serve students needs from multiple campuses saving utility and facilities, academic and technical staffing, and other costs Consolidation of Network Management and Monitoring; Establishing Administrative Service Centers or a Systemwide Administrative Service Center to improve quality levels, as well as reduce the costs of network services Consolidation of Delivery and Administration of Telecommunication and Related Services; Forming Administrative Service Centers to improve service levels as well as reduce the costs of telecom services Consolidation of Administration of Commonly Used Information System Utilities; Establishing Campus-based Technical Administrative Function Associations, or Administrative Service Centers to lower unit cost of the administration and delivery of commonly used systems control applications Consolidation of Data Centers; Supporting a move of Administrative Service Centers; or Systemwide Administrative Service Centers to reduce the number of physical data processing sites necessary to serve campuses B. Information Security Shared or Regional Information Security Offices; Regional Campus Administrative Partnerships or Administrative Service Centers created among campuses leveraging limited availability of skilled individuals and resources across several campuses while reducing costs

19 Page 18 Establish Information Security Technical Service Centers; Technical Administrative Function Associations or Administrative Service Centers, could be created sharing technical experts knowledgeable about intrusion and forensics specialties C. Financial Accounting and Reporting Complete Simplification of the Common Financial System; Administrative Service Centers, or Systemwide Administrative Service Centers could be established to support completion of the Common Financial System, including tactical teams for period closing, accounting allocations, etc. and technical teams supporting application upgrades, file maintenance, etc. Consolidate and/or Regionalize Payroll Processing; Administrative Service Centers, or Systemwide Administrative Service Centers could be established to administer payroll across the University or within regions Consolidate and Regionalize Accounts Payable and Disbursement Processing; Administrative Service Centers could be established to administer campus payable and disbursement process across the University or within regions Consolidate and Regionalize Accounts Receivable Processing/Collection of Student Fees; Administrative Service Centers could be established to administer campus and systemwide receivable collections D. Facilities Management and Construction Shared Facilities Maintenance and Repair Staff; Administrative Release Time, Campus Administrative Partnerships; or Technical Administrative Function Associations could be created between campuses limiting the need for contracting external experts with special skills such as roofing or plumbing Coordinated Inspection Services; Administrative Release Time, Campus Administrative Partnerships, or Technical Administrative Function Associations could be created sharing inspection experts knowledgeable regarding plan check or other engineering specialties Construction Project Management; Administrative Service Centers, Systemwide Administrative Service Centers could be established among campuses leveraging limited availability of skilled individuals and resources across several campuses Utilization and Project Analysis Reporting; Campus Administrative Partnerships, Administrative Service Centers, or Systemwide Administrative Service Centers might be established to regionalize energy utilization reporting responsibilities as well as energy contract management and energy/plant project analysis E. Budgeting Shared or Regional Budget Offices; Campus Administrative Partnerships, Administrative Service Centers, or Systemwide Administrative Service Centers could be created among campuses leveraging limited availability of skilled individuals and resources across several campuses while reducing costs Shared Budget Analysts; Administrative Release Time; or Campus Administrative Partnerships could be created reducing the need to replace employee attrition

20 Page 19 F. Risk Management Regional or Shared Risk Management Office; Campus Administrative Partnerships, Administrative Service Centers, Systemwide Administrative Service Centers might be established among campuses leveraging limited availability of skilled individuals and resources across several campuses while reducing costs Coordinated Insurance Riders and Indemnification Technical Service Centers; Technical Administrative Function Associations could be established to verify coverage across the University or within regions Shared Occupational, Health, and Safety Office; Campus Administrative Partnerships, Administrative Service Centers, Systemwide Administrative Service Centers could be created reducing the need to replace employee attrition Shared Hazardous Investigation and Inspection Services; Administrative Release Time, Campus Administrative Partnerships, or Technical Administrative Function Associations could be formed sharing inspection experts knowledgeable regarding hazardous materials Workers Compensation Case Management; Campus Administrative Partnerships, Administrative Service Centers, or Systemwide Administrative Service Centers could be established sharing workers compensation technical experts across campus regions Workers Compensation Case Inspection Services; Administrative Release Time, Campus Administrative Partnerships, or Technical Administrative Function Associations could be created sharing inspection experts and specialists G. Public Safety and Parking Services Regional or Shared Public Safety Leadership/Management; Campus Administrative Partnerships, Administrative Service Centers, or Systemwide Administrative Service Centers might be established among campuses leveraging limited availability of skilled individuals and resources across several campuses Consolidated or Shared Public Safety Dispatch Services; Campus Administrative Partnerships, or Administrative Service Centers could be utilized to consolidated dispatch facilities regionally Broader Utilization of Regional Parking Ticket Administration; Campus Administrative Partnerships, or Administrative Service Centers could be established to expand cooperative ticket processing regionally across the University H. Emergency Preparedness and Continuity of Service Expanded Business Continuity Services Coordination; Campus Administrative Partnerships, Administrative Service Centers, or Systemwide Administrative Service Centers could be established to expand coordinated recovery services regionally across the University Broaden Implementation of Coordinated Disaster and Emergency Preparedness; Campus Administrative Partnerships, Administrative Service Centers, or Systemwide Administrative Service Centers could be established to better coordinate preparedness across multiple campuses