Robotics and Automation Society

Business PlanReport

Outline

Background context Business plan principles Business process

Background Context

Current RAS Business Divisions

Four current business divisions Publications Conferences Administration Investments/Reserves

Annual

Operating Surplus/

Loss

Reserves Surplus/

Loss

Current Financial Flow

PublicationsMember FeesASPP/IELNon-member Fees

Conferences SurplusBook Broker

Administrative Travel, AwardsTech. Comm, IEEE

Market Gain

Market Loss

Minimum per TAB 50%

Op Expense

Reserves Margin

Reserves

Publications

Surplus/Loss

ApprovedInitiatives

Income Expenses

Recent Financial History*

* All numbers in thousands

Stan. Dev.

1997Actuals

1998Actuals

1999Actuals

2000Actuals

2001Actuals

2002Actuals

2003 Actuals

2005Budget

 

Op Net 70.5 243.2 382.8 380.4 321.9 333.3 460.3 415.7 88.1

Market Chg 239.0 70.8 59.4 160.5 (14.7) (99.0) (382.8) 396.2 0.0

IEEE Tax (235.8) (631.7)  

Adjustments (4.1) (39.1) 59.3 (10.1) (34.1) (216.7) 174.3  

Net Surplus 473.1 309.9 403.1 600.2 61.3 (431.5) (139.2) 986.2  

 

Reserves 786.9 1,190.0 1,790.2 1,851.5 1,420.0 1,280.8 2,267.0  

 

Watch List Exp 930.9 1,049.6 1,110.3 1,125.6 2,005.0 1,545.2 1,199.2 1,940

IEEE TAB Rules

Reserves can only be budgeted for initiatives in accordance with TAB rules Cannot be budgeted for operations IEEE TAB must approve initiative

requests Operating Fund/Watch List rule

Negative operations in 2 consecutive years => Watch List

Reserves Watch List rule Reserve/Expenses < 0.5 of operating

budget in any 2 consecutive years => Watch List

Other IEEE Factors

New ASPP/IEL formula will cost RAS >$125k per year unless we can obtain more Xplore usage or more articles

Reduced Book Broker income expected IEEE recommends non-member rates and

has penalized rates below recommended IEEE recommends that member rates

cover variable publication costs Highly variable IEEE Administration costs

Financial Controls

Direct controls Member fees (only $110k out of $2.2

mil.)* Non-member subscription rates

($170k) Member subscription rate ($22k) Page charge rate ($38k) Advertising rates ($27K) Conference budget approval &

direction *Numbers are 2003 actuals

Financial Controls

Direct controls Some expenses (travel, awards,

distinguished lecturer, member activities, long range planning, technical activities) ($60k)

Page counts Editorial reimbursed expenses

($105k)

Financial Controls

Indirect controls ASPP/IEL ($400k)

Depends on number of Xplore hits and # articles

Book broker policy Which conference proceedings are

included # articles

# subscriptions – subscription drive Form of subscriptions – encourage change

Electronic subscriptions avoid expense IEEE services used

IEEE Budget Process

Op. Bud. ≤ Proj. inc.

For year N

Initiative Request

s

Soc. Bud. Req.

April, N-1

June, N-1

IEEE TAB

Budget Review

& Approv

al

Society Budget

s

Year N

}

Current RAS Unbudgeted Expense

Process

These expenses come from current operating budget, not reserves Can be added by AdCom, but stay net positive

Unbudgeted expense request brought to the Financial Activities Board prior to AdCom

VP for Finance presents the financial impact on the budget to the AdCom

The AdCom votes on funding the program

Current Unbudgeted Expense Input

Required

Program title Name of the proposer

(responsible for annual report) Starting and ending dates Amount requested Funds administered by

(committee, etc.) Brief description Expected benefit to Society

Recent Approved Initiatives & Unbudgeted Expenses

T-ASE startup $300k Member Activities -- Virtual Communities $ 3k RAS Chapter of the Year Award $

1k/yr RAS Technical Activities initiatives $ 10k Long Range Planning Committee initiative $

5k IEEE Field Award $ 10k+/yr Distinguished Service Awards $ 3k/yr EdCom initiatives $ 12k Distinguished Lecturers Program $ 9k/yr Archiving pre-1988 publications $ 35k  

Note: Recurring expenses must transition to operating budget

Some Observations

Standard deviation of operating net was $208k

IEEE Tax part of operating budget since 2002

Excluding effects of IEEE Tax or market variations, the operating surplus could be reduced without much danger of going on Watch List

The largest market reduction in reserves was $383k

TAB reserve requirement: $970k

Business Principles

Motion

The business principles and processes listed below shall be adopted as the basis for RAS financial operations.

Business Plan Principles

There shall be a process to annually review business divisions and set operating and reserves goals

Non-member income should support member services

Operating budget surplus and initiatives shall be targeted to manage reserves

Consideration should be given to control member costs as well as to new initiatives

Business Plan Principles

Our reserves shall Be maintained at or above the TAB

specified minimum plus a safety term Suggest TAB min + 50% worst market

loss + initiative capacity For example, ($1,940k/2) + ($383k/2)

+ $125k ≈ $1,300k Be the basis for establishing new

initiatives Initiatives are a mechanism for using

our reserves to benefit members

Business Plan Principles

While initiatives are encouraged when resources are available, strong proposals are expected. Reserves should not be spent simply

because the excess reserves are substantial

The initiative process shall consider Member inputs Income sources and budget impact Formal independent review of initiative Transition from initiative to ongoing

expense or sunset

Business Plan Principles

Expenses (to members) of carrying out society business shall be reimbursed

Members should not normally be paid for society activities Major business activities should be led by

member volunteers but supported by professional services, either inside or outside the IEEE

As a volunteer-run Society, consideration should continually be given to business simplification

Business Process

Annual Business Process

FAB review of ongoing activities, in conjunction with boards where appropriate

Benefit/cost review of initiatives at end of period Self study from initiative managers Independent review If appropriate, recommendation on

continuation or termination

Annual Business Process

Divide new initiatives into two categories Fixed duration

Secondary impact on budget, use reserve funds

Expected ongoing activity Possible initial reserve funding Assess long term operating budget impact

Minimum size unspecified, but est. $5,000 Require detailed proposal for initiatives

All information required for unbudgeted expenses

If over $X, a process plan for implementation Evaluation plan

Annual Business Process

Obtain LRPC input on desired annual initiative capacity

Board reviews, AdCom decisions; Set ongoing expense budget Set target reserve level Target budget surplus goal to move

toward desired reserve level, while avoiding Watch List problems.

Society Budget Process

Fall, N-2 Winter, N-1

Committees generate initiative ideas & prelim

proposals

Review byVPs/Brds

orLRPC

Detailed proposal

s prepared

Member

Inputs

Business Process

AdCom Review & Decisions

FAB Financial Analysis

Initiative Activity Review

Initiative Requests by VPs, LRPC

Initiative Capacity Request:

LRPC

Rates

Conference Goals

Financial Status

Reserve Goals

Anticipated External Factors

Budget Decisions

Initiative Decisions

ExCom Review

ICRA, N-1

Spring, N-1

Prop. Bud.

IEEE Budget Process

Op. Bud. ≤ Proj. inc.

For year N

Initiative Request

s

Soc. Bud. Req.

April, N-1

June, N-1

IEEE TAB

Budget Review

& Approv

al

Society Budget

s

Year N

}