AMERICAN UNIVERSITY OF BEIRUT

AMERICAN UNIVERSITY OF BEIRUT HUMAN RESOURCES DEPARTMENT Strategic Planning Committee Report 2005 Submitted on Committee members: - James Albert Radulski - Amal Hamadeh - Samar Diab - Jacques Féghali - Nagib Choueiri - George N. Bitar - Dr. Nadia Shuayto - Mary Jaber 12/29/2005 Page 1 of 17

Mission Statement We will deliver increased value to AUB by providing HR resources, (knowledge, support and infrastructure) so that faculty and staff are operating at high professional standards and at a level necessary to achieve institutional objectives. Vision Statement Our HR organization is a dynamic community of responsive professionals who partner with their clients to achieve a progressive and productive work environment that meets the challenges of change. Major Accomplishments in the Previous Three Years o Human Capital re-engineering, and application of EDP program in 2003 had 94 participants, of which 67 were replaced resulting in a net savings of $4.5M over a three year period. o Reduction of HIP deficit by 58% from $4.2M in 03/04 to $2.4M in year 04/05 through reengineering HIP Initiated outsourcing study of HIP activities (2004). o Removal of automatic salary increases (4%), and adoption of merit-based system of salary increases in 2003. o Hiring of Deputy VP HR to provide leadership for modernization of HR and start of HR Transformation Process in 2004. o Initiated consulting study to rationalize classification and compensation for non-academic employees (2005) o Specialized functional training and certification for AUB HR professionals was initiated in 2004 to support the HR Transformation. (Will be completed by December, 2005) o Initiated consulting study for the rationalization of Plan A and Plan B retirement programs for academic employees and to replace TIAA CREFF as supplier for plan A retirement program. o Devolution of AUBMC Finance function o Integration of career services throughout the Faculties (2005). o Competency based performance management/career development Internet based program has been initiated at AUBMC via specialized software from Competency Assessment Solutions (CAS)(2004). The intent is to pilot the system at AUBMC and then expand it to include Campus in 2005/6 o Improving and increasing the user-friendly character of the HR website o Several client-serving processes were developed on an on-line basis: mechanization and modernization of various HR processes, such as: certificate requests, procedures of retirement plans A and C, registering trainees and tracking training courses o Revision of non-academic policy manual initiated and to be completed in 2005. o Initiation of work-load analysis for faculty administrative functions in 2005. o At Campus, Training sessions delivered were 293 with total 28720 man-hours. Avg Hrs per trainee = 33.2 and Avg hrs per employee = 29.3 o At Hospital, Training sessions delivered were 1212 with total 22086 man-hours. Avg Hrs per trainee = 12/29/2005 Page 2 of 17

15.9 and Avg hrs per employee = 11.9 o Training has moved from an ad-hoc function to being a solid platform for employee development and performance improvement. Resources have been assigned to ensure that training and development needs are identified and met via internal and external programs. External Trends and Influences o Increasing number of competing universities in Lebanon and reputable universities in the Gulf may cannibalize undergraduate and graduate students as well as provide competition for academic and nonacademic faculty. o Increasing number of hospitals in the Gulf (eight new hospitals being built in Kuwait) competing for qualified talent and potential AUBMC clients. o Unstable political, economic and security situations in Lebanon. o Competitive Gulf labor environment in private industry. o An inefficient NSSF system that provides little in the way of a decent retirement income. 12/29/2005 Page 3 of 17

Summary Analysis of Strengths, Weaknesses, Opportunities and Threats S 1 S 2 S 3 S 4 S 5 S 6 S 7 Strengths Senior management willing to transform AUB into a SFO We have an abundance of policies that help in directing our processes and procedures Management is supportive of Service Excellence Experienced, knowledgeable, motivated and dedicated individuals in various positions and departments aligned with current organizational structure. Availability of internal resources for knowledge transfer (faculty, e- learning systems, library facilities) Availability of substantial IT professionals and infrastructure in AUB as a whole. Transferable HR data (Central and peripheral HR systems) W 1 W 2 W 3 W 4 W 5 W 6 W 7 W 8 W 9 Weaknesses Absence of (Competency and Job Family) Management Systems needed to drive SFO transformation. Misalignment between business units. Our remuneration is not aligned with our strategy. Antiquated performance management system. Coordination and knowledge sharing between departments is minimal. Our culture is still characterized by an entitlement mentality.. Many components of present structure are not aligned for strategic growth. Low internalization of mission, vision, core values Underutilization of AUB internal resources for knowledge transfer. Misalignment between resources and T&D plans. W 10 Training is not yet competency-based. W 11 W 12 W 13 W 14 W 15 Absence of career path development process / succession planning. HR professionals competency gap We do not have an integrated Enterprise Resource Program/Process (ERP). Contribution of HR information to Mgt decision process (Strategy development and follow-up etc...) is minimal due to lack of a strategic plan. Lack of clear and concise compensation philosophy for Academics 12/29/2005 Page 4 of 17

W 16 Lack of transparency in the promotional mechanisms of Academics. Opportunities Threats O 1 Learning from the experience of other Institutions in Lebanon & overseas. T 1 Strategy focused and active local, regional & international competitors. O 2 Accreditation requirements driving higher standards T 2 Governmental and syndicate actions increasing the cost of benefits. O 3 Tapping on internal and external resource pools (Human, Systems, Programs...) T 3 Regional political uncertainty makes AUB a less attractive employer to the international community. O 4 Suitable systems available outside. T 4 Retention of key IT resources if local IT market should heat up. O 5 Consolidation of databases. T 5 Systems security & infiltration T6 Inadequacy of NSSF retirement program to meet NA retirement needs. 12/29/2005 Page 5 of 17

Human Resources Strategy Map Vision Our HR organization is a dynamic community of responsive professionals who partner with their clients to achieve a progressive and productive work environment that meets the challenges of change. Strategic Themes Organization Capital Human Capital Information Capital Customer Perspective C1- Continually provide for an (internal and external) equitable salary and classification structure C2- Promote HR strategic partnership with Clients C3- Provide for an equitable retirement benefit that maintains and attracts talent C4- Drive organizational behavior so that there is an improved transparency and communication level. C5- Develop qualified, competent, and performing employees. Internal Processes Perspective I1- Improve efficiency, effectiveness and satisfaction with HR processes and services. Learning & Growth Perspective L1- Develop qualified, competent, and performing HR Team. Financial Perspective F1- Human capital cost containment. 12/29/2005 Page 6 of 17

Summary of Strategic Initiatives Perspective Customer Objective Ref. Strategic Objectives Strategic Initiatives C1 Continually provide for an (internal and external) equitable salary and classification structure. IC1.1- Update compensation and classification structures. Automate job classification and salary structure management. IC1.2- Facilitate development of career ladders. Promote HR strategic IC2.1- Implementation of phase II of HR C2 C3 C4 partnership with Clients. Provide for an equitable retirement benefit that maintains and attracts talent. Drive organizational behavior so that there is an improved transparency and communication level. Transformation. IC3.1- Review and rationalization of Retirement Plans A&B. IC3.2- Addition of loan provision based on hardship needs for Plans A&B IC3.3- Replace TIAA CREFF as supplier for plan A retirement program IC3.4- Recommend a retirement plan for non-academics supplementary to NSSF End of Service Indemnity. IC4.1- Provide for transparency in Plans and Results. IC4.2- Review and publish the Non- Academic Policies and Procedures Manual. Internal Process Learning & Growth Financial I1 L1(+C5) F1 Improve efficiency, effectiveness and satisfaction with HR processes and services. Develop the Human Capital of AUB. qualified, competent, and performing employees. Human capital cost containment. II1.1- Continue HR Transformation. Build HR Process(es) and Service(s) Teams. II1.2- Plan and launch HR Service Center II1.3- Rationalization of HR systems IL1.1- Provide for a NA employee T&D Curriculum that is aligned with the job competency platform. IL1.2- Drive the development of managers (HR related) competencies; and drive their involvement in developing the competencies of their team members. IL1.3- Certify HR officers. IL1.4- Drive the usage of NETG self learning approach. IF1.1- Rationalization of HIP IF1.2- EDP Reduction of 30 Headcount IF1.3- Rationalization of training expenses 12/29/2005 Page 7 of 17

Summary of Key Performance Indicators American University of Beirut Human Resources Department Key Performance Indicators Perspective Strateg ic Objecti ve Ref. Measure Ref. KPIs Actual Results Customer Internal Process MC1.1 100% of positions reclassified under the new classification C1 project target June 06 MC1.2 30% of positions with specific career ladders by Sep06 MC2.1 60% of Client Segments have direct HR Officer assignment by Sep06 MC2.2 Allocated HR Officers spend minimum 20% of their time on C2 partnering with clients MC2.3 25% improvement in the results of survey on client satisfaction with HR services over OIRA baseline survey conducted in MC3.1 Proposal to generate rationalization of Plans A&B ready by end Jan05 MC3.2 Proposal for Loan Provision Plan presented to senior C3 management by end May06 MC3.4 TIAA CREF Plan A replacement in place by end Jan05 MC3.5 Proposal for retirement plan for non-academics supplementary to NSSF ESI ready by end Sep06 C4 MC4.1 Revised manual ready and distributed/published by June06 MI1.1 A document that demonstrates the Planning, Communication and Implementation of Client focused HR service. I1 MI1.2 MI1.3 Have HR Service Center operational by Apr06 CAS application, TP Framework application and T&D application integrated into AUB HRIS by end June 06 12/29/2005 Page 8 of 17

Learning & Growth Financial L1 F1 ML1.1 ML1.2 ML1.3 ML1.4 ML1.5 ML1.6 MF1.1 MF1.2 MF1.3 Number of quarterly training calendar posted on web one month prior to beginning of each quarter; per year.(2 by Sep06) Average training hours per employee delivered to AUB employees = 14 hrs 50% Managers trained on assessing and developing organization standard competencies of their team members by end June05 20% of AUB NA population using NETG self learning application. All MS Office related applications training done through NETG. Complete first wave of HR certification program by end Dec05 Second wave of HR certification completed by end Dec06 Reduction of 30 employee count via EDP, by end Nov. 2005 Reduction by 15% of overall university subsidy of HIP expenses over 04-05 levels Percent of sessions delivered by External resources to total sessions, <= 20% 12/29/2005 Page 9 of 17

Initiative Common Planning Template Initiative Statement No: 1 2 3 4 5 6 7 8 9 10 Total cost of Initiative II1 Criticality Rating: X $ Initiative Statement: II1.1- Continue HR Transformation. Build HR Process(es) and Service(s) Teams. Initiative Owner James Radulski II1.2- Plan and launch HR Service Center II1.3- Rationalization of HR systems Key Implementation Step Implementing Work Unit / Owner Act. S/L/O Start End 1.1 Centralize HR services in Campus organization JR 06/03 06/09 (all personnel files, and information relating to same) 1.2 Review various HR Systems NC/WN/MK 05/12 06/03 Structures/Features 1.3 Set Plan to rationalize HR Systems NC/WN/MK 05/12 06/04 1.4 Rationalize HR Systems WN/MK 06/04 06/08 1.5 Identify HR Service gaps in relation to Client NC 05/12 06/01 needs. Provide and align services to close gaps. 1.6 Develop tool to manage and measure NC/WN 06/01 06/03 deliverables of HR services to Clients. 1.7 Develop tool to relate Training Data to CAS & NC/WN* CNS 06/01 06/06 TP Workshop 1.8 1.9 1.10 1.11 1.12 Notes / Comments / Explanations *Requires Coordination with CNS Exp. C/O Increment to Current Year Funding Levels FTE Year1 Year2 Year3 S/L/O: S= Short term, L= Long term, O= Ongoing C/O: C= Capital Expenditure, O= Operating Cost 12/29/2005 Page 10 of 17

Initiative Common Planning Template Initiative Statement No: 1 2 3 4 5 6 7 8 9 10 Total cost of Initiative IC1 Criticality Rating: X Initiative Statement: IC1.1- Update compensation and classification structures. Automate job classification and salary structure Initiative Owner Samar Diab management. IC1.2- Facilitate development of career ladders. Key Implementation Step Implementing Work Unit / Owner Act. S/L/O Start End 1.1 Initiate project, name Project Team S. Diab 05/10 05/10 1.2 Complete classification phase W.Abiad/ 05/11 06/02 S.Diab/ G. Bitar/ J. Feghali 1.3 Complete compensation phase W.Abiad/ 05/11 06/02 S.Diab 1.4 Develop/launch communication program to G.Bitar/ 05/11 06/03 organization Z. Tomey/ M. Jaber 1.5 Preparing for implementation S. Diab 06/02 06/03 1.6 Install TP Framework software, link to AUB W.Najal 05/11 06/01 HRIS / CAS R.Haddad 1.7 Train user community on TP Framework S.Diab/W.Naja 06/01 06/04 1.8 1.9 1.10 1.11 1.12 Notes / Comments / Explanations Exp. C/O Increment to Current Year Funding Levels FTE Year1 Year2 Year3 S/L/O: S= Short term, L= Long term, O= Ongoing C/O: C= Capital Expenditure, O= Operating Cost 12/29/2005 Page 11 of 17

Initiative Common Planning Template Initiative Statement No: 1 2 3 4 5 6 7 8 9 10 Total cost of Initiative IF1 Criticality Rating: X $ Initiative Statement: IF1.1- Rationalization of HIP Initiative Owner James Radulski IF1.2- EDP Reduction of 30 Headcount IF1.3- Rationalization of training expenses Key Implementation Step Implementing Work Unit / Owner Act. S/L/O Start End 1.1 Outsourcing RFP JR 05/07 05/08 1.2 Evaluation of responses to RFP JR 05/09 05/09 1.3 Negotiation with supplier JR 05/09 05/10 1.4 Go/NoGo decision to outsource JR 05/10 05/11 1.5 If NOGO on outsourcing restructure employee JR/HIP 05/11 05/12 contributions and co-payments. Committee 1.6 Complete "Wellness Program" proposal, S.Diab 06/03 06/05 integrate with health & Safety proposal 1.7 Secure approval of Wellness program(selffunding) S. Diab 05/11 06/05 1.8 Implement program upon approval A. Hamade 06/03 06/03 1.9 Monitor and evaluate results of Wellness A. Hamade 06/03 06/12 Program 1.10 Identification of candidates for EDP Reduction A. Hamadeh 05/06 05/10 1.11 Complete processing of EDP. A. Hamadeh 05/09 05/11 1.12 Develop and launch 05/06 training program G. Bitar/N. 05/10 06/09 based on realistic internal/external suppliers Choueri Notes / Comments / Explanations Exp. C/O Increment to Current Year Funding Levels FTE Year1 Year2 Year3 S/L/O: S= Short term, L= Long term, O= Ongoing C/O: C= Capital Expenditure, O= Operating Cost 12/29/2005 Page 12 of 17

Initiative Common Planning Template Initiative Statement No: 1 2 3 4 5 6 7 8 9 10 Total cost of Initiative IC2 Criticality Rating: X Initiative Statement: Initiative Owner IC2.1- Implementation of phase II of HR Transformation James Radulski Key Implementation Step Implementing Work Unit / Owner Act. S/L/O Start End 1.1 Name HR Officers at AUBMC, communicate AUBMC 05/04 05/04 and implement service to client base 1.2 Name HR Officers at AUB Campus, Amal Hamadeh 05/09 05/10 communicate and implement service to client base 1.3 Complete certification of HR Officers N.Choueiri 04/10 05/12 1.4 Develop follow up program on HR Certification N.Choueiri 05/10 06/02 1.5 Communicate HR Transformation program to JR 04/10 05/12 end-users on monthly basis 1.6 1.7 1.8 1.9 1.10 1.11 1.12 Notes / Comments / Explanations Exp. C/O Increment to Current Year Funding Levels FTE Year1 Year2 Year3 S/L/O: S= Short term, L= Long term, O= Ongoing C/O: C= Capital Expenditure, O= Operating Cost 12/29/2005 Page 13 of 17

Initiative Common Planning Template Initiative Statement No: 1 2 3 4 5 6 7 8 9 10 Total cost of Initiative IC3 Criticality Rating: X $ Initiative Statement: IC3.1- Review and rationalization of Retirement Plans A&B Initiative Owner James Radulski IC3.2- Addition of loan provision based on hardship needs for Plans A&B IC3.3- Replace TIAA CREFF as supplier for plan A retirement program IC3.4 - Recommend a retirement plan for non-academics supplementary to NSSF End of Service Indemnity. Key Implementation Step Implementing Work Unit / Owner Act. S/L/O Start End 1.1 Initiate consulting study -Plans A&B JR 05/07 05/07 1.2 Review consulting study and select best JR 05/10 05/12 alternatives - Plans A&B 1.3 Develop RFP f/plan A. Negotiate with vendors, JR 05/12 06/01 secure contracts 1.4 Develop communication plan for participants JR 05/12 06/01 Plan A 1.5 Launch Revised plan A JR 06/02 06/03 1.6 Evaluate plan B alternatives. Make JR 05/12 06/03 recommendations 1.7 Conduct a feasibility study on establishing a JR 06/01 06/03 retirement plan for non-academics supplementary to NSSF ESI 1.8 1.9 1.10 Notes / Comments / Explanations Exp. C/O Increment to Current Year Funding Levels FTE Year1 Year2 Year3 S/L/O: S= Short term, L= Long term, O= Ongoing C/O: C= Capital Expenditure, O= Operating Cost 12/29/2005 Page 14 of 17

Initiative Common Planning Template Initiative Statement No: 1 2 3 4 5 6 7 8 9 10 Total cost of Initiative IC4 Criticality Rating: X Initiative Statement: IC4.1- Provide for transparency in Plans and Results Initiative Owner Amal Hamadeh IC4.2- Review and publish the Non- Academic Policies and Procedures Manual. Key Implementation Step Implementing Act. Work Unit / S/L/O Owner 1.1 Provide revised manual for legal approval and then for presidential approval 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 1.10 1.11 1.12 Notes / Comments / Explanations Start End JR 05/04 05/12 Exp. C/O Increment to Current Year Funding Levels FTE Year1 Year2 Year3 S/L/O: S= Short term, L= Long term, O= Ongoing C/O: C= Capital Expenditure, O= Operating Cost 12/29/2005 Page 15 of 17

Initiative Common Planning Template Initiative Statement No: 1 2 3 4 5 6 7 8 9 10 Total cost of Initiative IL1(+C5) Criticality Rating: X Initiative Statement: IL1.1- Provide for a NA employee T&D Curriculum that is aligned with the job competency platform. IL1.2- Drive the development of managers (HR related) competencies; and drive their involvement in developing the competencies of their team members. IL1.3- Certify HR officers. IL1.4- Drive the usage of NETG self learning approach. Key Implementation Step Implementing Work Unit / Owner Act. S/L/O Start End 1.1 Develop programs list, calendar and budget. GB/NC 05/09 05/10 -(Priority to Organization Standard Competencies). 1.2 Post training calendar quarterly on web WN/EA 05/12 06/09 1.3 Develop Manager s ability to evaluate their GB/NC 05/10 06/06 direct reports organization standards competencies. 1.4 Drive the usage of NETG in closing competency NC 05/09 06/09 gaps. 1.5 Complete 1 st wave of certification NC 05/10 05/12 1.6 Negotiate deal for new wave of certification NC 05/10 06/01 1.7 Conduct new wave of certification NC 06/02 06/09 1.8 1.9 1.10 1.11 1.12 Notes / Comments / Explanations Exp. C/O Initiative Owner George Bitar-Ghanem & Nagib Choueiri Increment to Current Year Funding Levels FTE Year1 Year2 Year3 S/L/O: S= Short term, L= Long term, O= Ongoing C/O: C= Capital Expenditure, O= Operating Cost 12/29/2005 Page 16 of 17

Mechanisms and Activities to Secure/ Staff input to the Planning Process - Formation of Planning Committee - Planning committee sets the broad lines of the strategic plan. - Formation of subcommittees that develop blue print documents as per the IPPI process. o Subcommittee 1: Mission Statement, Vision Statement, Major Accomplishments, External Trends. o Subcommittee 2: SWOT analysis. o Subcommittee 3: Initiatives. - Plan blue prints are reviewed by the Planning Committee intermittently, and adjustments are made accordingly by the concerned subcommittee. - Beta version of Plan is reviewed by Planning Committee plus all Initiatives Owners. - Adjustments are made accordingly and final version of plan is published. - A DB application (under development) allows sharing the plan documents among all those authorized to do so. - Same application allows entering progress made in implementing plan by owners of each initiative step. Mechanisms and Activities to Foster Interdisciplinary, Cross-University, Cross-unit and Cross- Functional Programs - Same application allows generating documents that show the specific step(s) where input, communication, coordination or assistance are required from other functional units. - Document is shared with other units and reviewed. - Adjustments to plan in specific initiative steps are made accordingly. Schedule of Strategic Performance Reviews - Continuous review of progress made on initiatives steps delivery is available to the initiative owners via the DB application. - Planning committee reviews progress on plan implementation on the last Thursday of the month following the end of each quarter. - Preparations for Quarterly Review are made by planning process owner. - Plan documents are adjusted according to the review results. - Meet with stakeholders once a year to review performance against plan. 12/29/2005 Page 17 of 17