Consultant’s review of U admin structure underway

The consulting firm the U of M hired in late January will finish by March 8.
February 21, 2013

An independent consulting firm University of Minnesota President Eric Kaler hired has started its review and is currently cataloguing the various levels of administrative employees as part of its month-long look at the school’s operating structure.

Throughout the next few weeks, New York-based Sibson Consulting will analyze whether the University has the appropriate ratio of oversight.

In March, the company will report to the University and point out areas where efficiency can be increased and how that can best be achieved.

In a letter to the University, Michael O’Malley, Sibson’s higher education compensation practice leader, said the goal is to strike a balance between the appropriate number of managers and the employees they oversee.

“Tall, hierarchical structures with narrow widths of control can be bureaucratically top-heavy, slow moving and expensive,” he said. “Excessively flat designs with few layers and broad spans of control can be uncoordinated.”

Sibson provides services to industries like hospitals, sports leagues, insurance companies and higher education institutions.

It has worked with the University in the past on the school’s employee classification system, said Kathryn Brown, University vice president of human resources.

“[Sibson] had an advantage in that they already had some knowledge of the University, and we could easily bring them up to speed on this work, which was complementary to the work that they had done for us earlier,” Brown said.

The company has also worked with other schools in the Big Ten, like the University of Michigan and Ohio State University, Brown said.

Sibson spokeswoman Mary Feldman said the company cannot discuss past or current clients.

The University considered working with other national consulting firms — some priced around $100,000 or more — but Brown said most were out of the University’s price range. The University will pay Sibson $48,000 for its five weeks of service.

“[Sibson] gave us a very attractive price,” she said.

Sen. Terri Bonoff, DFL-Minnetonka, and Senate Majority Leader Tom Bakk, DFL-Cook, requested the University hire an external consultant to conduct a data-driven review of administrative costs and provide guidance to become more efficient and cost-effective. The request came after a Wall Street Journal article reported excessive administrative bloat.

“The Wall Street Journal was a catalyst for me to say ‘What are we doing at the University of Minnesota?’” Bonoff said.

She said she wasn’t familiar with the work Sibson has done but was aware the company had worked with the University in the past.

“I hope [the analysis] will, in fact, be independent, but I called for the report, so I don’t think it was my role to second guess it,” she said. “I will second guess it if I don’t like the detail in the report, but I am giving those folks the benefit of the doubt at this point.”

Some have questioned why the Legislature didn’t choose the consulting company to conduct the report, but Bonoff said the University’s autonomy keeps legislators from mandating who the school works with.

“Unless we were willing to pay for it, I didn’t feel that it was our role to do that,” she said.

Brown said the consultants were on campus for the first time last week and will visit at least one more time before concluding the analysis on March 8, a week before the report of findings will be presented to the Legislature.

In a Feb. 13 press release giving details of the analysis, Kaler noted that a report showing the University’s operational structure in relation to other universities would soon be made available.

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