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Board Accepts Study on Regionalization and Consolidation in USG Business Practices

Atlanta — November 19, 2003

As part of its strategic plan, the Board of Regents of the University System of Georgia (USG) is exploring several options for achieving more efficient business practices throughout the System. Toward this goal, the Board received – and accepted – a comprehensive study conducted by MGT of America, a national management research and consulting firm. MGT evaluated a host of options for regionalization and consolidation of various business practices in an effort to reduce costs and increase efficiencies throughout the University System of Georgia.

The MGT study examined business practices at all institutions within the University System of Georgia to identify “best practices” for running more effective operations. The MGT study also examined business practices in other state systems and institutions, such as the University of Texas System, the North Carolina System, and the Arizona Board of Regents, among others.

“In the current fiscal climate, all state agencies must seek opportunities to reduce costs and increase efficiency,” noted William R. Bowes, vice chancellor for Fiscal Affairs at the University System of Georgia. “At the same time, our goal is to better serve our campuses by providing them with resources and services they cannot afford to replicate on a smaller scale. This will allow them to redirect resources to teaching and serving students, which are key goals of the University System.”

A key recommendation of the MGT study entails considering the consolidation of payroll processing. Mr. Bowes presented consolidation among a number of other options for payroll processing, including maintaining the current decentralized system, outsourcing to an alternate service provider, or regionalizing current efforts. The Board of Regents directed University System staff to explore these options and present final recommendations to the Board within the next three months.

The MGT study also evaluated current purchasing practices in the University System, noting that opportunities exist to leverage the System’s size to better coordinate purchasing activities. Goals in this area include identifying opportunities for the System to obtain better prices and terms through collaborative System-wide purchasing contracts, standardizing purchasing procedures, and promoting the outsourcing of purchasing opportunities, where applicable, in order to reduce reliance on in-house staff to provide back-office services.

At the meeting, the Board of Regents also directed staff to proceed with a new purchasing strategy and the creation of a mentoring program for finance and business staff throughout the University System.

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