University of Notre Dame

Rob KellyNancy Fulcher

NAEP Annual MeetingApril 22, 2009

An Organization Chart for the Future:A Case Study

University of Notre Dame Procurement Services

Agenda

•Profile•Timeline•Organization Transition•Strategic vs. Tactical•Leadership vs. Management •Commodity vs. Process Expertise•Takeaways

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University of Notre Dame Procurement Services

University Profile

•Private/Catholic: founded in 1842 by Rev. Edward F.

Sorin

•National: students from all 50 states, many countries

•Location: beautiful South Bend, IN

•Enrollment: ~8,500 undergraduate; ~3,000 graduate

•Employees: ~5,000 faculty and staff

•Budget: ~$1B total, ~$300M non-wage, non-scholarship

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University of Notre Dame Procurement Services

The Campus Procurement Landscape

•Spend Managed by Procurement Services ~40%– Office Supplies, Lab Supplies & Equipment, Furniture, IT Hardware & Software, etc.

•Spend Managed by Decentralized Purchasing Units~30%

– Architect’s Office (Construction)– Performing Arts (Artists, Theatre Equipment/Supplies)– University Libraries & Law Library (Books & Periodicals)– Food Services (Food, Supplies)– Utilities (Energy)– Transportation Services (Automobiles)

•Other Spend ~30%– Travel, Entertainment & Reimbursements to Employees & Students– Payments to Other Universities– Consulting, Legal & Professional Services (Most)– Books & Periodicals (Some)– Organizations & Clubs– Other

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University of Notre Dame Procurement Services

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Timeline of Recent Major Events

2007 Realignment Under Finance Division/Controller’s GroupReorganization of Personnel & Creation of Director role

2008 First full cycle of Strategic Planning & Goal/Objective SettingStrategic Sourcing Engagement with Huron Consulting Group

2001 McKinsey Study CommissionedDepartmental Reorganization & Creation of AVP role

2002 Initial Implementation of e-Procurement SolutionGo-Live with HigherMarkets (later acquired by SciQuest)First Wave of University-wide RFPs/Contracts Executed

2004 ERP Go Live with SCT Banner Higher Ed.Campus-wide Deployment of e-ProcurementContracts Administrator Hired (First Contracting FTE)

2009 New Responsibility for Outsourced Printing Services and Travel

University of Notre Dame Procurement Services

Organization Prior to December 2006

616 Full Time Positions (excluding Central Receiving,

NDSurplus and Intern)

University of Notre Dame Procurement Services

Functional Org Prior to December 2006

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University of Notre Dame Procurement Services

Issues & Proposed Changes

•Issues:– Structure not conducive to performance

management– Implicit management structure without explicit

authority– Lack of clarity regarding roles and responsibilities

•Proposed Changes:– Reduce span of control– Create a level of working managers with authority– Build teams with specific functional responsibilities

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University of Notre Dame Procurement Services

Proposed Organization February 2007

916 Full Time Positions

University of Notre Dame Procurement Services

The Reorganization

•New organization structure rolled out May 2007

•Three functional teams created; each with a new manager

•Three positions eliminated/absorbed– 13 FTEs remain in Procurement Services

•All employees retained and reassigned as necessary

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University of Notre Dame Procurement Services

The Procurement Functions

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University of Notre Dame Procurement Services

Resulting Organization July 2007

•~ 130 Years Procurement Experience across 13 FTEs•3 MBAs, 1 JD, 5 C.P.M.s, 8 Bachelor Degrees

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University of Notre Dame Procurement Services

Functional Organization July 2007

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University of Notre Dame Procurement Services

Continuous Change

•In past 18 months, four departures and four new hires

•One Buying Assistant splits time with AP

•Senior Staff Assistant becomes temporary

•Creation of Procurement Agent position

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University of Notre Dame Procurement Services

Current Organization

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University of Notre Dame Procurement Services

Strategic vs. Tactical

Strategic Tactical

Managing change Answering phone calls, e-mail, etc.

Developing people; building teams Processing orders

Creating and monitoring goals Facilitating customer needs

Creating/analyzing business plans/cases

Collecting data and information

Building and managing relationships Monitoring contract compliance

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University of Notre Dame Procurement Services

Strategic vs. Tactical

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% Strategic / % Tactical

Current Target

60/40 80/20

50/50 70/30

20/80 50/50

0/100 10/90

University of Notre Dame Procurement Services

Leadership vs. Management

Leadership Management

Developing and communicating vision Monitoring performance to objectives

Introducing change Creating stability and structure

Authority from followers Authority from subordinates

Provide direction Provide instruction

Innovation Administration

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University of Notre Dame Procurement Services

Leadership vs. Management

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% Leadership / % Management

Current Target

50/50 80/20

20/80 50/50

10/90 25/75

0/100 10/90

University of Notre Dame Procurement Services

How Do We Get There?

1. Eliminate– Just stop doing the non-value added work

2. Automate– Leverage technology wherever possible

3. Delegate– Use the resources we have to free up

others

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University of Notre Dame Procurement Services

Commodity vs. Process

•Faced with these realities:– Can not replace the experience and knowledge we have– Budget constraints limit salary and relocation flexibility– Increasing need for cross-training and extended

coverage

•We changed our hiring philosophy:– Value process expertise over commodity knowledge– Personality and “fit” become even more important– Potential for development also given strong

consideration

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University of Notre Dame Procurement Services

Takeaways

•Have a detailed vision for your organization– Develop an ideal future state

•Revisit your organization chart and vision regularly– Organizations are fluid; change presents

opportunity

•Make strategy and leadership a priority– Eliminate, Automate, Delegate

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University of Notre Dame

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Thank You.

Questions?