An analytics system designed to manage risks and improve security has saved the University of California’s 10 campuses and five medical centers more than $160 million since 2006, officials announced March 25—helping the university system cut costs during an economic crisis that has crippled campus budgets.
The universities in the UC system have used IBM’s analytics software since 2006 to better aggregate massive amounts of data from the 228,000-student system and help administrators target wasteful spending and isolate dangerous areas on campus that result in injury or operation failure.
Using IBM’s Enterprise Risk Management System program, UC officials said decision makers at every campus and medical center have been able to mine the system’s database and spot trends, such as pushing and pulling injuries at medical centers.
Once that trend was found in the data, officials could purchase new, safer equipment and launch training programs designed to limit the number of pushing and pulling injuries and accidents. Making decisions based on these statistics, which appear on a computer-based dashboard, has reduced injuries by 39 percent and cut insurance costs by $167.8 million over the past four years, officials said.
“When you’re on a tight budget—and we’re on a tight budget—you need to know where to spend your money, where to spend your time,” said Grace Crickette, the University of California’s chief risk officer. “We get a much, much better picture about where we need to deploy resources.”
Most colleges and universities have seen operating budgets stagnate or gradually drop during the country’s economic downturn, but California’s budget crisis has wrought tuition increases and new student fees widely considered some of the worst in the nation.
The California Postsecondary Education Commission announced March 11 that the state’s four-year universities and community colleges will see a 16.4-percent increase in undergraduate students by 2019, meaning schools will need “$139 million annually over the next 10 years to satisfy undergraduate demand.”
California legislators cut the state university system’s budget by $584 million, or 20 percent, for the 2009-10 school year. The Northridge campus has operated this academic year with $41 million in cuts—24 percent of its overall budget.
“It takes no shortage of imagination to know that we have faced some challenging financial times,” said Pete Taylor, the university’s chief financial officer. “[Deep budget cuts] have put a real crimp in our ability to continue doing business as usual.”
San Francisco City College officials said in February that all summer sessions would be canceled to close the college’s $12 million budget gap. That move came three months after California’s Legislative Analyst’s Office projected a $20.7 billion budget shortfall for the entire state.
The UC system got more bad financial news March 12 when a San Francisco judge ordered the university to pay back $38 million in fees to about 3,000 graduate students. The students—who started in law and business graduate programs in 2003—were illegally charged fees while they earned their master’s degrees, according to court documents.
Crickette said university officials conducted campus-wide interviews to determine where to target dwindling funds for mitigating risks, adding that the questions didn’t “focus on what kept them up at night,” but rather probed for strategies that had proven useful.
“We don’t want to just create another list of things that could go wrong at UC,” she said. “We wanted to know what could go right.”
Computer-based risk management programs traditionally have relied heavily on a quantitative approach, whereas the IBM analytics system focuses on a qualitative approach that helps officials at a single campus manipulate data to find specific ways to minimize risks that could cost the campus millions.
“We now have the means—the processing power and analytics capabilities—to sift through the data and extract meaning in ways that previously were not possible,” said Bridget van Kralingen, general manager of IBM North America.
Crickette added: “They can target the key variables that influence outcomes and make changes to increase productive trends or intercede in operations that are having a negative impact.”
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