Today's N&O has a big story on a study by Bain and Company of administrative efficiency at UNC-CH. The headline "Report Finds Bloat at UNC" sounds like a big expose. But after reviewing the study on the UNC-CH website, I think there is less here than meets the eye. Bain found that UNC-CH has a complex organizational structure and that administrative expenses had grown more rapidly than academic expenses. This is true at every major public research university, including NC State. The report NEVER gets into the root causes of the phenomena. Instead, it rather naively recommends the standard business process and IT system re-engineering that took place in most Fortune 500 companies in the 1990s, e.g., collapse layers of management. (For instance the report makes a big deal about many supervisors having only one to three direct reports. Maybe these surpervisors have job responsibilities of their own?)
UNC-CH and NC State are not Fortune 500 companies; they are public research universities. The ratio of overhead to academic costs will rise whenever universities decide to undertake a wider range of overhead activites or when the cost of overhead inuts rises relative to academic inputs. There is little reason to believe that the price of a dean or a program director has risen relative to the price of a faculty member, so let's focus on the activities side of the equation.
I see two leading suspects, the first of which is regulation. Most of the research is funded through federal agencies that dictate volumes of regulation. Accreditation bodies extract an additional tax, one that has gradually risen over time (for instance, now universities have to demonstrate academic programs result in student learning, and test scores don't count as evidence). The state has its own requirements, especially for personnel and procurement. All of these mandates require resources. To offset these costs which have grown over time at a good clip, universities rely more and more on non-tenure track faculty to provide instruction, thereby flattening out the growth rate of the academic expenses.
The second is mission creep. To compete for students and gain a spot or two in the US News rankings, universities are engaged in a broader range of activities than they were when (ahem) I was in school. For instance compare dorms, gyms, and student centers today to 30-40 years ago. Universities have launched initiatives to correct problems that linger from that era, e.g., diversity offices and advisors. And of course we also have intercollegiate athletics; how many more teams, coaches and administrators do we have now? Last but not least, universities are becoming more and more involved with economic development, including research parks such as NC State's Centennial Campus.
By ignoring the mission and environment of UNC-CH and the root causes behind the changes in structure and overhead expenses, the Bain report comes off as, well, a standard consulting report. Bain would (for a certain price) be more than happy to help UNC-CH re-engineer all sorts of systems and processes. But would you write a big check to a consulting company to do this if you thought they had missed the boat on problem definition?
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