News About a Mid-Year Cut

The Executive Vice-Chancellor and Provost issued a memorandum to campus officials today noting that the University may be faced with a further reduction imposed by State actions. The Governor has called a special session of the legislature and has proposed $4.5 billion in increased revenue and $4.5 billion in increased expenditure reductions. The impact on UC in his proposal is $65.5 million in additional cuts for 2008-09 for a total mid-year reduction of $98.5 million. We are all waiting for the legislature to respond to this.

Based on the campus projects, UCLA’s share of the total $98.5 million mid-year reduction is $17.8 million. The Chancellor has agreed to absorb $11 million of this reduction and will allocate the remaining $6.7 million as a 1% across the board general fund budget reduction target. While it is possible that the Regents may discuss a mid-year increase in student fees, and the legislature may not support the governor’s proposal, it is prudent to further reduce expenditures this year. Should the additional reduction not materialize this reserve may help ameliorate further reductions in 2009-10.

The Library will move immediately to reserve the 1%, and we should all be careful to make no expenditures that are not critical.

One Response to “News About a Mid-Year Cut”

  1. Zheng says:

    Our strategy to Improve Service Quality in a Downturn

    I want to ask a question and hear your thoughts: How do we improve service quality while we are coping with this tough economic time?

    Users continue to demand high quality services regardless what economic environment we are in. We have a choice to cut or not cut service quality, so do users have a choice to stay with us or not to. What if our competitors have a strategy to sustain innovation during the next few years, and thus improve service quality gradually and win our users over? We witnessed that companies which sustained innovations and implemented changes during dot-com bubble burst came out as winners to secure more users and market share. The least thing I want to see is that we are victimized by this budget cutting environment: users are leaving for our competitors due to cut on service quality.

    Budget cutting is a very sophisticated art and science. Simplistic across the board cuts may endanger critical library priorities and hurt our long term wellbeing. The bigger context than this downturn economy is that we are catching up with our competitors in terms of innovative delivery of services. Turing off innovation during a downturn may be counterproductive.

    I think budget cut is necessary, especially in areas that show signs of over spending, to meet the immediate challenge; however, I would advocate for a strategy beyond cost cutting: Taking a close look at our operation and processes holistically and focusing on opportunities to improve customer services and experiences through:

    1. Slash wastes: eliminate unproductive expenditures and processes;
    2. Increase operation efficiency: Synergy and saving gained from the Lean Principles;
    3. And thus, create aggregated resources to support critical innovation, which generates saving, satisfies users, and increases operational efficiency in short and medium term.

    Bottom line is the budget cutting excises should resolve the challenge stated in the Library Strategic Plan: “distinguish itself as a user-centered, future-oriented organization.” A user-centered and future-oriented budget cut is critical; otherwise, we will setback all our effort of the past few years in this endeavor.

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