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    Ikabod.doc.doc.doc.doc Ikabod.doc.doc.doc.doc Document Transcript

    • Human Resources and Benefits Department Strategic Plan University of California Office of the President Division of Business and Finance May 27, 2004
    • Strategic Plan May 27, 2004 Table of Contents Overview and Assumptions I. Our Strategic Planning Process and Assumptions II. Our Framework – A Dynamic, Interconnected, Progressive Human Resources System III. Who We Are A. Our Mission B. Our Principles and Values C. Our Functions and Constituencies D. Our Organizational Structure E. Who We Serve IV. The Way We Work – Connections, Consultation, Collaboration A. The Groups We Work With: Internal and External V. The Environmental Context for Our Planning and Work A. The External Environment B. Our Internal Environment C. Trends • Implications of Demographic Trends on UC’s Workforce • Regulatory/Political/Legal Trends • Economic Trends D. Our Budget VI. Our Critical Issues, Strategic Priorities, and Goals VII. Our Next Steps VIII. Attachments: • Principles and Commitments for Labor and Employee Relations • Members of the Strategic Planning Team • Selected Strategic Planning Resources • Timelines, Sponsors, and Owners 2
    • Strategic Plan May 27, 2004 Overview This is the strategic plan for the University of California (UC) Office of the President’s Human Resources and Benefits Department. Our work is part of a larger long-range planning effort within the University. The plan has been created for multiple purposes. The first sections of the document serve as an orientation to the Human Resources and Benefits Department and the context of our work, and the latter sections describe current and anticipated challenges to our organization and summarize our major strategies and goals (see Section VI). The plan focuses primarily on the critical issues to be addressed in the next 3-5 years and does not fully describe all the resource intensive, high priority operational work of the department and the process improvement efforts to support that work. For more information about our operations we have made references to on-line sources. Our Critical Issues • The challenge of reconciling the impacts of the economic and demographic conditions of the state and nation with our obligation to support the University’s mission and mandates • The challenge of providing long range system-wide planning and decision-making leadership in our centralized/decentralized environment • The challenge of responding to the labor and regulatory pressures that are changing UC’s sense of autonomy and leverage, creating in many cases increased costs and administrative complexity, as well as creating the potential for fundamentally changing the way the institution operates A key concept in this plan is balance – a theme throughout this document. Our policies, contracts, benefits, etc. need to be shaped by the answer to the central question: does an action to be taken help in building and sustaining a diverse staff and faculty to best support the UC mission? Our key focus is supporting a productive and engaged workforce and a productive workplace. There are many constraints and considerations that we must balance – creating interesting but challenging work. In this document you will learn about: • Our Strategic Planning Process • Our Framework – A Dynamic, Interconnected, Progressive Human Resources System • Who We Are • The Way We Work – Connections, Consultation, Collaboration • The Context for Our Planning and Work • Our Critical Issues, Strategic Priorities, and Goals • Our Next Steps This document is intended to be a working document that will continue to be updated as we add detail about specific actions to be taken to address 3
    • Strategic Plan May 27, 2004 critical issues and as we extend the conversations about planning to the broader UC community. 4
    • Strategic Plan May 27, 2004 Our Assumptions 1. A progressive human resources system1 is required to support key indicators of institutional quality2. 2. The development of a progressive human resources system requires a long-term, multi-year strategy. 3. The Office of the President will take a leadership role in developing and championing a progressive human resources system. 4. We define a productive workforce as employees who are motivated, competent and strategically focused to perform high- quality work in support of the mission. 5. There is a causal relationship between productive people, a workplace environment of high quality productivity, and accomplishment of the University’s mission. 6. There is a causal relationship between a progressive human resources system and developing a productive workforce. 7. A progressive human resources system must include proactive human resources activities and services, as well as monitoring and compliance functions. 8. Although we hold simplicity as a value, we recognize that implementation of systemic change in an organization of our size and diversity is inherently complex. 9. We will continue to operate in a mixed centralized/decentralized environment. We will continue to pursue appropriate consistency and accountability in our human resources policies and practices where functions are delegated or decentralized. 10. In recognition of the interdependent nature of human resources activities within the UC system, the plan is intended to reflect input from, and recognition of, the differing needs of campuses, medical centers and laboratories. 11. We will have better integrated human resources strategies, where appropriate, that reflect the links between faculty, other academic, and staff employees. 12. In order to measure the effectiveness of the progressive human resource system, appropriate quality and accountability measures must be determined. 13. Our communication strategies are aligned with the University's broader communication strategies in support of its mission. 14. Partnership, professionalism, and civility are necessary for the success of a progressive human resources system. 1 See graphic of Human Resources Framework, Section II for full definition of a progressive human resources system. 2 Indicators such as employee turnover rates, competitiveness of benefits for faculty and staff, and lower employee liability costs. 5
    • Strategic Plan May 27, 2004 I. Our Strategic Planning Process This planning process was commissioned by Judith Boyette, Associate Vice Strategic Planning is the President – Human Resources and Benefits to help our Human Resources ongoing process of and Benefits department both to understand our current situation and to deciding the optimal plan for near and long term sustainability. The process that was developed alignment between is an attempt to add, as a part of the leadership function of the department, unlimited needs and specified time to step back from the daily pressures and plan in a limited resources to systematic, integrated, and strategic way. The outcome of the process will achieve priorities. serve as a foundation for guiding some priorities and funding strategies over the next three to five years. Though our planning encompassed a broad view of our environment, our key strategies focus primarily on our domains of influence. As a result of our work, the strategic planning process has been integrated into the on-going work of the department. The Department has made an effort to integrate the strategic planning process into our daily work, to schedule and staff monthly meetings to review our progress, and to formally update this document at least annually to reflect the most current understanding of our departmental priorities. The Leadership of Human Resources and Benefits worked with organizational consultant Katherine Mitchell, from the Berkeley campus, to develop the planning process. The model used for planning is described in the diagram below. STRATEGIC PLANNING Phase 1 Phase 2 Phase 3 Establish Your Organizational Develop and Implement Evaluate How Well Identity an Action Plan to Achieve Your Actions Address Your Strategic Priorities Your Strategic Priorities Who are we? Who are we? Where do we Where do we want to be? want to be? • Organizational • Organizational Culture & Values Culture & Values • Vision • Goals & Outcomes • Performance Measures • Mission/Statement • Mission/Statement of Purpose of Purpose • Critical Issues & • Initiatives Strategic Priorities • Operational Improvements • Constituents & Stakeholders How will we How will we • Competitors & Partners know how we know how we • External Environment How will we How will we are doing? are doing? • Internal Environment get there? get there? Where are we Where are we now? now? Developed by Katherine Mitchell and Jon Bain CORE – UC Berkeley – Fall 2000 6
    • Strategic Plan May 27, 2004 II. Our Framework During our strategic planning process we built a model to visually represent strategic alignment of our efforts in a dynamic, interconnected, and progressive human resources system. The Framework is designed to respond to systemic issues and be aligned with the University’s mission. It recognizes the importance of linking and integrating our practices, policies, labor contracts, benefits – all our employee offerings and our work environment – to ensure that the University attracts and retains the best workforce in a values-driven workplace environment. All that we do in this arena is within a context of constant change that requires a resilient and flexible infrastructure. Our strategies and goals are all focused to fulfill our overarching goal of being known as a good employer for purposes of recruitment, retention and engagement of UC’s faculty and staff to accomplish the University's mission Human Resources Framework UC Mission Teaching Research Public Service t en iro s, Productive nv nt nm l E me People rna uire Productive Workplace t xte eq ex l/E l R es nt s n a ga Progressive a l om Co ter Le Human Resources System Go utc , In ty, it y tibili O pa • Aligned practices, policies, labor contracts, om employee offerings* and work environment, culture bil cc c C • Processes for hiring, orienting, acculturating, nta managing performance, developing employees and l A mi ou ca de planning for succession es Fis Aca i eg at S tr al Enabling & Constraining Factors i tic es Cr su Leadership & Management Support Systems Administration Planning Organizational Design Technology Communication Funding Is * Such as health benefits, retirement plans, compensation, etc. 7
    • Strategic Plan May 27, 2004 III. Who We Are A mission or statement of A. Our Mission: System-wide Leadership to Build an purpose is a short, Effective Workforce inspiring statement that describes why your We provide system-wide leadership of a progressive human resources organization exists, what system to build and sustain a diverse faculty and staff that will most services you provide effectively support the University of California’s mission of teaching, (your business), identifies research, and public service.3 who receives your services (key • We work to support the alignment of our strategic direction, constituents), and budget, funding, and legislative practices describes how these • We provide system-wide planning, policy, and program services are provided development (values). • We administer the Office of the President and system-wide programs and services • We serve in a fiduciary role as plan administrator for UC’s health, welfare and retirement plans and programs • We provide programmatic funding to locations • We strive to balance our commitments to quality human resources programs and services with access and affordability for the UC community Our Work… Leadership to build and sustain a diverse faculty and staff to best support the mission Going in one direction Staying aligned / stitched together as we go… Image adapted from Sam Kaner, Community at Work B. Our Principles and Values We embrace the values of the University community that include: • An environment of civility and mutual respect • A climate of fairness and cooperation 3 Includes the patient care, medical technology and research performed by UC Medical Centers, as well as the work of the three national laboratories under UC management. 8
    • Strategic Plan May 27, 2004 • A diverse community of people working together with integrity and professionalism to foster a working and learning environment to best support our mission 9
    • Strategic Plan May 27, 2004 These principles are fully articulated in: • The Principles and Commitments of Employee and Labor Relations (See Attachment) • The Office of the President Principles of Community (http://www.ucop.edu/humres/prncpls_comm.html) as well as the Principles of Community of all locations • The Regents Policy on Compensation (See Footnote 14, page 26) We are also guided by: • The professional standards of the Business and Finance Division (http://www.ucop.edu/ucophome/busfin/goals.html) • The administrative vision of the New Business Architecture Report (http://www.ucop.edu/irc/nba/) • The public educational values stated in the California Master Plan for Higher Education (http://www.ucop.edu/acadinit/mastplan/welcome.html) C. Our Functions and Constituencies4 The system-wide Office of Human Resources and Benefits serves a mix of constituencies, both academic and staff, in an array of functions and activities. We provide service and leadership through the following primary functions: • Human resources policy and employee relations for non- represented staff employees5 Compensation for staff employees. • Labor relations for academic and staff employees. • Benefits planning and administration for the University of California community – faculty, academic and staff employees retirees and their family members covered by the University's plans and programs • Affirmative Action, Equal Opportunity, and Diversity for staff employees. • The administration of the human resources program and benefits for the Senior Management Group, including support of the Regental oversight role. • Information systems, customer service, legislative analysis and constituent relations, strategic communications, training, research and planning support all functional areas above and their related constituents. • A full-service human resources function for the 2,200 people in the Office of the President. 4 Since categories of constituents, stakeholders, competitors and partners are not mutually exclusive and change depending on context, we have clustered them into Internal and External Groups We Work With and Constituents (Sections III C. and E.) 5 A few policies apply to everyone, such as the Sexual Harassment Policy and the Whistleblower Protection Policy. 10
    • Strategic Plan May 27, 2004 D. Our Human Resources and Benefits Organization The services noted in blue are core functional areas, and the services noted in yellow provide the infrastructure to support these areas. For a full description of the people and services of the department, go to (http://www.ucop.edu/humres/welcome.html) As stated in our mission, our leaders work to support the alignment of the University's strategic direction, budget, funding, and legislative practices. Se Com enef nio pen its s n tio un ic r M sa mm teg &B ica an tion Co Stra ag em &B en HR ide t -w y Labor R tem teg elations Sys Stra HR/B HR/B H Pr R/B s og Po ce ra m licy Client Relations & ur Re OP De & so an UC sig Diversity n m Hu Cross Functional Teams Our department uses many standing cross functional teams to accomplish its work. Examples of currently active groups are: • The Medical Contribution Task Force • The Regents Dashboard Work Group • Compensation and Benefits Strategy Work Group • UCRS-RFP (University of California Retirement System Request for Proposal) Work Group • Health Insurance Portability and Accountability Act of 1996 (HIPAA) Work Group 11
    • Strategic Plan May 27, 2004 Our Role as Different from a Campus, Laboratory, or Medical Center Human Resources Function: Unlike our campus, laboratory, and medical center human resources offices, our central human resources office is responsible for speaking with one voice on human resources issues for the University of California system. We actively work to reflect and represent the needs and interests of our diverse constituents to the UC Regents, government agencies and the legislature, in consultation with the UC faculty and staff, and to the public. Much of our most challenging work is aggregating disparate information and opinion to create a common voice. Central administration roles for our office include, for example: • Conducting research and responding to legislative issues6 • Supporting the Regents in their oversight role • Responding to University-wide audits • Central responsibility for implementation and compliance with collective bargaining and other labor/employment laws • Creation of policy • Design and administration of the University's benefits programs. Our Human Resources and Benefits Department is staffed differently from a location. For example, each location human resources office has a large employment function since a critical human resources activity – hiring – happens there. Our office, on the other hand, has a large retirement staff because the University, unlike most employers, administers its own retirement plans and programs. 6 Of the thousands of bills introduced in the California Legislature each year, several hundred have implications for Human Resources and for the University. We analyze, cost and review all bills that impact our areas of responsibility including bills on human resources, health insurance, disability, use of personal information, and contracting out, to name a few. 12
    • Strategic Plan May 27, 2004 E. Who We Serve (by the Numbers) Constituents are groups that use or benefit from We provide services to active faculty and staff, faculty and staff who are no an organization’s longer working with the University, retirees, dependents and beneficiaries. services. Examples of HR&B Services and Constituents Approximate Program Financial Services Constituents Population Size Scope Retirement System Faculty, other academic and UCRP7: $50.2 billion in pension and staff employees, retirees, 120,000 actives investment funds covered dependents and 22,000 inactive  Defined benefit plan beneficiaries 37,000 retirees and beneficiaries  Defined contribution plan Defined Contribution Plan:  403(b) plan 415,000 (active and inactive)  415(m) plan 17,000 CSU SH8  Proposed 457(b) plan 403(b) Plan: 98,000  Multiple internal/external investment options Health & Welfare Plans Faculty, academic and staff 120,000 actives $1.05 billion in annual employees, retirees, and 38,000 retirees premiums dependents 170,000 family members 31 plans/vendors Labor Relations Represented staff employees, 14 unions represented student employees, 22 bargaining units & represented non-Senate contracts academic employees, UC More than 68,000 employees Santa Cruz Senate Faculty Compensation Staff employees 53,000 Represented staff Campus payroll $3.97 billion 67,000 not represented by unions Policy Non-represented staff 67,000 employees employees AA/EEO and Diversity Staff employees SMG9 – 300 MSP10 – 6,000 PSS11 – 110,000 Labs12 - 22,000 TOTAL – 138,300 Senior Management Employees in the Senior Approximately 400 senior Management Group administrators and deans UCOP Human Resources All employees of the Office of 2,200 employees the President 7 University of California Retirement Plan 8 California State University Safe Harbor Plan 9 Senior Management Group 10 Management and Senior Professionals 11 Professional and Support Staff 12 3 DOE Laboratories 13
    • Strategic Plan May 27, 2004 IV. The Way We Work: Connections, Consultation and Collaboration The Groups We Work With: Internal and External Our authorities in administration are delegated from our governing board, The UC Regents. Here is a schematic representing the complexity of our connections and consultations. Our connections, and the related consultations, are complex for many reasons, including:  The number and variety of constituents  The number and variety of businesses (medical centers, laboratories, campuses)  The overlap of constituent groups  The number of ways of making decisions  The complex web of relationships with those we serve and those we get our authority from  Our various and diverse context  The varied ways in which we derive authority. Complexity of Our Connections, Consultations and Collaboration Number and Complex web of variety of relationships with those constituents we serve and those Overlap of we get our constituent authority Groups from Number of ways of making decisions Number and variety of Various ways businesses we derive Various and authority diverse context 14
    • Strategic Plan May 27, 2004 Human Resource Academic Council,* Managers The Regents* (Ex. Benefits, Compensation, AA/EEO, Employment, Employee Including Faculty Relations and Labor Relations) Welfare Chief Human Resource Officers Vendors/ Executive/ Agents of UC Academic Vice Chancellors Examples of Groups Academic Personnel General Counsel We Work With Chancellors, Lab Advisory Groups Administrative Vice And Associations Chancellors Directors, Directors of Medical Centers 24 Unions The Government Budget Office (Federal including 31 Bargaining Units Treasurer’s Office DOE, State, Local) ∗ The authority we have, under the shared governance model, is either from The Regents or, where delegated to the Academic Council, from the Council. We work with many groups, including but not limited to those noted above and in the following list. In most of the roles listed here there are representatives at each location – not just one person – since the University has nineteen locations including campuses, laboratories and medical centers. • The Academic Senate, including various Academic Council Committees, especially the Faculty Welfare Committee and its Subcommittees (see http://www.ucop.edu/acadadv/acadpers/handbook/govern.html for the University’s commitment to shared governance) • Campus, Laboratory, Medical Center Administration, as well as Office of the President Administration. This includes but is not limited to Chancellors and Directors of the three National Laboratories, the Directors of the UC Medical Centers, the Office of the President leadership, Academic and Administrative Vice Chancellors, Planning and Budget Officers, Chief Human Resources Officers, AA/EEO Officers, Benefits Managers, Labor Relations Managers, Employee Relations Managers, Employment Managers, Compensation Managers, and Payroll Managers 15
    • Strategic Plan May 27, 2004 • 14 Unions representing over 61,000 employees in 24 bargaining units: − American Federation of State, County and Municipal Employees (AFSCME) (3 units) − American Federation of Teachers (AFT) (2 units) − Alameda Building Trades (1 unit) − California Nurses Association (CNA) (1 unit) − Coalition of University Employees (CUE) (1 unit) − Federated University Police Officers Association (FUPOA) (1 unit) − Graphic Communications International Union (GCIU)-Printing Trades (1 unit) − Los Angeles Skilled Crafts – Operating Engineers Local 501 (5 units) − Protective Service Officers Association – Livermore (1 unit) − San Diego House staff Association (1 unit) − San Francisco Building and Construction Trades (1 unit) − Santa Cruz Faculty Association (1 unit) − United Auto Workers-Association of Graduate Student Employees (UAW-AGSE) (units covering all campuses) − University Professional and Technical Employees-CWA (UPTE) (4 units) • Advisory Groups and Associations such as the Academic Business Officers Group, UC Retirement System Advisory Board, Senior Management Advisory Committee, Health Services Senior Management Advisory Committee, Council of University of California Emeriti Associations and Council of University of California Retiree Associations, Council of the University of California Staff Assemblies, University of California Gay, Lesbian, Transsexual, Bisexual and Intersex Association (UCGLTBIA), ethnic staff organizations, and various Task Forces as appointed In doing our work, we interact with and are influenced by a large number of external parties, which include groups such as the following: • The Federal Government, including some federal agencies, e.g., Internal Revenue Service, Department of Energy, Social Security, Department of Labor • The State of California Government, including the Governor, the Legislature, many State Agencies and Commissions, e.g., Department of Managed Health Care, Department of Fair Employment and Housing, Department of Finance, California Post Secondary Commission, Public Employment Relations Board, California Public Employees' Retirement System. • Vendors and Consultants, such as health plans, providers and actuaries 16
    • Strategic Plan May 27, 2004 V. The Environmental Context for Our Planning and Work An important element of As we provide system-wide leadership for the University’s human resources strategic planning is to and benefits programs, we must be responsible to our benefit program plan determine what external members and maintain our fiduciary responsibility to manage the Health & pressures impact your Welfare and Retirement plans and programs appropriately. The majority of organization and to our time and resources is devoted to these services. assess the opportunities and challenges these We work to reflect and represent the needs and interests of our diverse pressures present. constituents to The UC Regents, government agencies and the legislature, in negotiations with the unions representing UC faculty and staff, and to the public so that we represent multiple voices in our decision-making. Some Elements of the Complexity of Our Regulatory Environment: The environment for your Regulations organization Interact in encompasses the trends High Volume of Ways that are Not Conflict and changes that will Regulations Apparent Between impact your organization Diverse Interest Groups on in the following areas: Complexity Implementation Constantly sociodemographic, of Changing Sometimes Regulations Contradictory regulatory/legal, Regulations Regulations political, economic/financial, Require Interpretation Tension technological, and in Application Must be Between Shaped to Purpose education. and Culture of Role as Employer and Role Locations of Administrator of Retirement & Health/Welfare Plans A. Our External Environment 1. Our Regulatory Environment • Federal Laws and Regulations Examples for human resources and benefits are: − Internal Revenue Code − Americans with Disabilities Act − Age Discrimination in Employment Act − Family and Medical Leave Act − Whistleblower Protection Statutes − Health Information, Portability and Accountability Act (HIPAA) (Protects confidentiality of health information) − Federal Affirmative Action Statutes and Executive Orders − Fair Labor Standards Act (Minimum wage, overtime, recordkeeping) 17
    • Strategic Plan May 27, 2004 − Equal Pay Act of 1963 • State Laws and Regulations Examples for human resources and benefits are: − Higher Education Employer-Employee Relations Act − Fair Employment and Housing Act (Protects employees from harassment or discrimination due to thirteen criteria) − California Family Rights Act − State Whistleblower Law − Public Records Act − Knox Keane Act (Regulates UC's ability to contract with health maintenance organizations) − Numerous privacy laws in California governing disclosure of medical information B. Our Internal Environment 1. Our Regulatory Environment • The Bylaws of The Regents • UC policies, regulations and governing documents for plans and programs • Collectively bargained terms and conditions of employment • Audit findings • Accreditation findings for medical centers 2. Our Administrative Environment • The UC budget is decentralized. • Some Human Resources policy and administrative processes and procedures have been decentralized, resulting in a decrease in consistency of practices and operations. • The Regents, legislature, unions and public expect consistency across all locations and facilities even in a decentralized environment. • Administering Human Resources programs without standardized decision-making processes for the areas of UC that impact HR has become increasingly difficult. • Significant investments have been made by locations to develop location-specific Human Resources Information Systems which have limited coordination with central administration systems. This complicates gathering and providing reliable collective data. • There continues to be tension between UC’s public policy/administration responsibilities and its need to operate as a business enterprise, which has resulted in a more public/private hybrid human resources model. • Although all locations have much in common (such as facing comparable social, political, demographic, and economic trends as 18
    • Strategic Plan May 27, 2004 well as needing a progressive human resources system), building on these commonalities for collaboration is challenging. 19
    • Strategic Plan May 27, 2004 B. Trends Noted below are dramatic changes occurring in demographics, politics, regulation, economics, and our workforce. a. Demographic • California’s population is growing due to increasing in-migration, increasing immigration, and a high birth rate. The state is also changing in its majority and minority populations. These factors may affect the needs and expectations of the University’s future workforce, could influence UC’s culture, and produce changes in UC’s Health Care programs. Race/Ethnic Comparison of Year 2000 California Population Age 20-65 20- and UC Workforce 55.6 % 4 8 .5% 3 0 . 1% 2 2 .6 % 11. 9 % 12 . 8 % 7 . 1% 6 .4 % 2 .5% 0 .6 % 0 .6 % 1. 3 % Af ric a n A m e r i c a n In d i a n As ia n Hi s p a n i c o r Ot h e r/ Un k n o wn Wh i t e Ame ric a n La t i n o UC California UCOP Human Resources Source of Data: Census 2000, CA Department of Finance Workforce Research and Analysis UC Statistical Summary of Students and Staff Fall 2000 California Age Pyramid 1990-2000 3.1million 3.6 million 65+ years 1990 2000 Total Population: 2.2 million 2.6 million Total Population: 55 to 64 years 29,760,021 33,871,648 2.9 million 45 to 54 years 4.3 million 4.6 million 35 to 44 years 5.5 million 5.7 million 5.2 million 25 to 34 years 4.6 million 4.8 million 15 to 24 years 6.6 million 7.8 million 0 to 14 years NOTABLE CHANGES IN CALIFORNIA’S AGE STRUCTURE BETWEEN 1990 AND 2000 California's total population grew by almost 14% between 1990 and 2000--over 4 million new residents. Those reaching potential college age over the coming decade (10 to 19 year olds) grew 25%--almost 1 million. Those reaching potential retirement age over the coming decade (45 to 60 year olds) grew 44%--over 1.7 million UCOP Human Resources Source of Data: Census 2000 Workforce Research and Analysis Ca Department of Finance Demographic Research Unit 20
    • Strategic Plan May 27, 2004 • UC must hire significantly more faculty and staff if it is to absorb the projected 43% increase in its student population between 2000 and 2010 • Currently approximately 16% (as of April 2002) of UC's workforce, faculty and staff is age 55 with 5 or more years of UCRP service credit, and is therefore eligible to retire. University Employees Age 50+ with 5 Years of UCRP Service (DOE Labs, career staff, all academics except students) Staff - 23,647 Retirement Eligible Academics - 7,317 Retirement Eligible 3,779 19% of Staff, 31% of academics are retirement eligible as of October 2003 2,540 2,391 2,339 2,286 2,242 2,163 2,160 2,057 1,695 1,365 1,170 524 533 500 490 459 515 446 441 449 420 Age 50 51 52 53 54 55 56 57 58 59 60+ Retirement Eligible Workforce – Oct 2003 Workforce Research & Analysis 21
    • Strategic Plan May 27, 2004 b. Regulatory/Political • With each major change in state and federal administration and/or legislature there is the potential of tightening or loosening of regulation. • There is increasing interest by The Regents and the State Legislature in UC’s policies and practices, which requires new approaches to collaboration. • There is increasing pressure from the public and from public officials for accountability. c. Economic • Currently, California and the country are experiencing an economic recession, and recovery is expected to be slow. • Health care costs are increasing and the health care industry is in a volatile state • UC has received less core financing from the state in recent years. Other non-state fund sources, such as federal research funding, have become a larger share of UC’s budget. • As the gap between the UC contribution and the total gross premium for health insurance continues to widen, more health care costs will have to be borne by employees. Medical Cost Trends (millions) $700 $697 Total Gross Premium $606 (Inflation @ 22% in 2003 $598 20% in 2004; 15% in 2005) UC contribution with 15% $505 Increase $500 $520 UC contribution with no Increase after 2002 $414 $453 $394 $394 Data for campus only; does not include DOE labs, ASUCLA, $394 $394 $394 Hastings or retirees $300 October 2002 Quarterly Statistics Calendar Years 2002 2003 2004 2005 22
    • Strategic Plan May 27, 2004 • As with all other investors in the market, the trust fund covering UC’s pension benefits has lost value in recent years, thus hastening the possibility of the need for employer/employee contributions to resume. This would be particularly problematic during the current economic situation if significant pension contributions are needed to be included in UC's operating costs. Based on the current retirement plan design, the annual contribution (employer and employee) would be about 16% of payroll or 1 billion dollars per year. • As of 01/01/2003, the Plan’s Funded Ratio (i.e. Actuarial Value of Assets divided by Actuarial Accrued Liability) was 129% and is estimated to be approximately 125% as of 07/01/2003 (as compared to 154% as of 7/1/2000). • The chart below, based on data taken from the Asset/Liability Forecast Study, prepared by Towers Perrin and presented to The Regents on May 14, 2003, projects that the funded ratio in 2010, (with contributions) is, on average, estimated to be 99%. Without contributions it is, on average estimated to be 80%. The chart below reflects this forecasted change. UNIVERSITY OF CALIFORNIA RETIREMENT PLAN Funded Ratio (Actuarial Value of Assets Divided by Actuarial Accrued Liability) as of July 1 160 Actual 140 Forecast w /o Contributions Forecast w /Contributions 120 100 Funded Ratio 80 60 40 20 0 02 03 10 15 00 01 05 20 20 20 20 20 20 20 20 20 23
    • Strategic Plan May 27, 2004 Think Through Near Term Decisions with focus on Long Term Impact Example: Current 2010 Retirement Plan Changes Future Retirement Plan Design • Support both “lifers” and mobile workforce Economic • Support workforce of varying needs, levels, types Sustainability Current 2010 Current Health & Welfare Plan Health & Welfare Plans d. Workforce/Employer • In spite of the economic recession, California’s cost-of-living (especially the cost of housing) continues to increase and is one of the highest in the nation in urban areas. • Accordingly, it is increasingly difficult for lower-wage workers to maintain their standard of living as California's cost of living escalates, which can impact our recruitment and retention efforts. • There continues to be more focus on work/life issues in the UC community. • UC has a great challenge to remain competitive with the employment market (especially in certain high-demand specialties) in a time of state budget crisis and general economic constraints. • Concerns about large health insurance cost increases and the potential for retirement contributions to resume are affecting both UC (as an employer) and academic and staff employees. • There is a potential dramatic increase in the numbers of academic and staff personnel who will be retiring from the workforce. All of our planning must be done in the context of these environmental opportunities and challenges. Shifts in just one area alone can have huge effects on the University’s current and future workforce. 24
    • Strategic Plan May 27, 2004 D. Our Budget and Resources Human Resources/Benefits 2002-2003 Operating Budget 2002- Campus-based Service Delivery Programs Retirement and (Primarily Retirement and Health& Welfare Health & Welfare Funds) Administration • Voc Rehab 8% • Health Care Facilitator • Benefits Counseling 81% Funds 11% State and Common Funds (General HR functions, including Labor) Includes Temporary, Permanent, and ongoing annually allocated (and approved funds An important element of Factors Influencing the Human Resources and Benefits Budget strategic planning is to determine what internal • Unlike most public employers, HR/B administers its own retirement resources are available and medical programs covering academic and staff personnel and from your organization and to assess the their dependents. strengths and weaknesses • The majority (80%) of Human Resources and Benefits staffing of these resources. resources and efforts support the operational needs of administering our retirement and health/welfare plans. • Our two largest lines of business—Retirement and Health and Welfare benefits--have discrete funding streams which cannot be co- mingled with other funds. Administration of these plans and programs includes the support of an extensive information systems and communications infrastructure. • All other human resource functions are financed either totally or partially by state and common funds. These include compensation, policy, labor relations, senior management administration, AA/EEO, employee relations, planning, constituent relations and legislative analysis, as well as the human resources function for the Office of the President (2,200 people). • While the amount of money spent on plan administration, for Retirement as well as Health and Welfare, is large, it is low compared to public plan administration benchmarks. 25
    • Strategic Plan May 27, 2004 VI. Our Critical Issues, Strategic Priorities, and Goals Critical Issues are the Our Critical Issues handful of significant opportunities and • Our challenges emerge from the trends, pressures and environment challenges that must be described in this document. Identifying critical issues and strategic addressed to ensure the priorities and determining how to optimally address them within our on-going success of your resource limitations requires strategic thinking and decision making. organization. They In the next three to five years, as we endeavor to strengthen the represent the synthesis of human resources system to build and sustain a diverse faculty and the constituent and staff to best support the University’s mission, Human Resources and stakeholder needs, and Benefits will grapple with: the external and internal issues that impact your - The challenge of reconciling the impacts of the constraints organization. brought about by the economic conditions of the state and nation with our obligation to support the University’s mission Strategic priorities are and mandates where you choose to - The challenge of providing long range system-wide planning focus your organizational and decision-making in our centralized/decentralized energy; the optimal environment intersection between your - The challenge of responding to the labor and regulatory critical issues and your pressures that are changing UC’s sense of autonomy and resources. leverage, creating in many cases increased costs and administrative complexity, as well as creating the potential for fundamentally changing the way the institution operates Although the following strategies are listed separately, we view them as being interconnected and interdependent, and are intended to directly carry out our department mission. 26
    • Strategic Plan May 27, 2004 Goals describe the directions your Strategy 1: Address the application of the UC Funding model to the organization plans to structure of UC Human Resources programs and move in to address policies your critical issues and implement your Goal 1.1 Clarify and reframe the relationship between funding strategic priorities. sources and UC’s Human Resources policies and Goals provide the basis programs and system-wide labor agreements for developing Goal 1.2 Support a strengthened link between budget and initiatives or accountability to improve tracking of fund usage for operational internal planning and external reporting improvements. Goal 1.3 Educate constituents throughout the institution about the funding model requirements/constraints Our Human Resources Policy Office works proactively in close Strategy 2: Develop and maintain progressive human resources collaboration with locations processes which assure consistent and accountable to develop policy initiatives Human Resources operations across the University to that value our employees, build and sustain a productive and competitve work comply with federal and state legislation and are force. Align location practices with systemwide HR/B accessible, and easy to policies and labor contracts. Work to engage the understand. involvement of UC systemwide leadership in developing and strengthening a UC culture of engaging in ethical management and practices. This strategy reinforces the Regents’ directives on policy and compliance Goal 2.1 Plan for and develop integrated policies that are aligned to support a progressive human resources system through a policy architecture which includes benchmarking, regularly scheduled policy reviews, and compliance assurance through self- assessment/accreditation, audits and other related methods Goal 2.2 Ensure that all University labor agreements complement and sustain the progressive human resources system which supports a productive workforce Goal 2.3 Use training, communications and organizational effectiveness tools to support policy consistency and practice alignment throughout the UC system Goal 2.4 Strengthen ties of Human Resources with the University’s academic leadership as well as other key stakeholders Goal 2.5 Leverage the role of technology for policy and program development, implementation, administration and compliance 27
    • Strategic Plan May 27, 2004 Strategies reviewed and revised, August 2006 Our Compensation Policy Office provides system-wide Strategy 3: To help attract and retain the highest quality direction and support for all academic, managerial and staff talent by offering compensation programs, promoting a well-designed, cost- sustainable competitive total remuneration effective, market-based compensation program that Goal 3.1 Assess, develop, implement, and evaluate total allows UC to recruit and retain remuneration programs to ensure they are effective excellent employees. and efficient as well as consult on priorities and Our Retirement Program resource requirements for these programs. (including the defined benefit pension plan, the defined Goal 3.2 Maintain a key role in influencing the health contribution plan and the 403b industry, legislative and regulatory arenas. plan) helps provide for the long- term financial security for UC Goal 3.3 Promote employee appreciation and understanding employees, retirees and their beneficiaries. of total remuneration and personal engagement for health & welfare and retirement choices. Our Health and Welfare Program supports a healthy Goal 3.4 Assess customer satisfaction, vendor management, community of engaged and productive employees while and technology opportunities for total preserving: remuneration programs • Choice • Access • Quality • Affordability • Cost Predictability According to UC President Strategy 4: Support the President’s initiative for University-wide Robert Dynes “one of the University’s most urgent succession management through program development priorities is to implement a and incorporation of best practices that align leadership strategy and tactics for development, diversity and talent management efforts developing senior leadership at UC locations. talent and implementing effective succession planning to Goal 4.1 Develop an ongoing process to identify and assess ensure that UC’s future will be in the hands of the most highly organizational vulnerability, competencies, and high- talented leaders.” potential individuals to address turnover in critical positions. Goal 4.2 Leverage current organizational capabilities and outside best practices to support University-wide succession planning efforts. Goal 4.3 Design and deliver leadership development programs in alignment with UC values and ethical behaviors. Goal 4.4 Serve as a University-wide clearinghouse for succession planning by working with locations on talent review and leadership development. 28
    • Strategic Plan May 27, 2004 Strategies reviewed and revised, August 2006 Our Labor Relations Office is committed to a Strategy 5: Promote a positive labor relations environment that respectful, responsive, supports all employees as they fulfill the University's coordinated, and planned mission. approach to labor- management relations that Goal 5.1 Develop an effective labor relations decision-making best supports the structure that includes appropriate pre-planning and University's faculty, academic staff, and the involvement of all relevant locations, HR/B administrative staff as they functional areas and other OP departments. fulfill the University's Goal 5.2 Facilitate constructive working relationships with our mission of teaching, research and public service. unions Goal 5.3 Strengthen our labor relations training program for managers and supervisors Strategy 6: Provide support for management of the three national Department of Energy laboratories and assist in any bid process and related outcomes13 Goal 6.1 Develop and implement appropriate oversight structure for the HR functions at the laboratories in light of our Human Resources and Benefits Department's role in the Laboratory Management Council14 Goal 6.2 Assess human resources and benefits issues and options in the context of the Strategic Plan in order to influence decision-making at all levels. Goal 6.3 Strengthen Human Resources and Benefits Department relationships with the Department of Energy/National Nuclear Security Administration (NNSA)/Office of Science15 Strategies reviewed and revised, August 2006 13 The University of California manages two national laboratories, the Lawrence Berkeley National Laboratory and the Lawrence Livermore National Laboratory, for the Department of Energy/Office of Science/National Nuclear Security Administration (DOE/OOS/NNSA). The DOE decided to compete management of the Los Alamos National Laboratory contract and an LLC partnership between the University of California and Bechtel, International won the bid and took over management on 6/1/06. The DOE has now issued the request for proposal for the Lawrence Livermore National Laboratory with a proposed transition date of 10/1/07. For additional information see http://www.universityofcalifornia.edu/news/labcontract/welcome.html. 14 The UC Laboratory Management Council was established to strengthen the management and oversight of the UC-managed national laboratories by taking advantage of the expertise of UC's functional operations, including the office of human resources and benefits. 15 The DOE/NNSA has responsibility for the Lawrence Livermore National Laboratory and the DOE/OOS has responsibility for the Lawrence Berkeley National Laboratory 29
    • Strategic Plan May 27, 2004 Goal 6.4 Implement Strategy 2 in the context of the Department of Energy's requirements Goal 6.5 Provide support for the Human Resources Accreditation Project16 led by Lawrence Berkeley National Laboratory for the Department of Energy. Explore use and applicability of the standards in that project as quality measures for the human resources function Goal 6.6 Provide support for LANL contract close-out and transfer to new contractor. Goal 6.7 Provide support for LLNL contract close-out and transfer to new contractor. Strategies reviewed and revised, August 2006 16 The HR Accreditation Project's goal is to develop HR management system standards for use by HR departments seeking accreditation by a nationally recognized organization based on the HR body of knowledge. 30
    • Strategic Plan May 27, 2004 VII. Our Next Steps As stated earlier, this document is intended to be a working document that will continue to be updated annually. Attached is a chart of all strategies and goals indicating sponsors, owners, and estimated timelines. The department sponsors and owners will be actively working in 2004/2005 to refine this information, addressing the impacts of budget reductions and establishing performance measures. In addition, we will incorporate the work of the Department's Regents' Dashboard Work Group and will continue to work closely with those involved in the University's long-range planning efforts. 31
    • Strategic Plan May 27, 2004 VIII. Attachments • Principles and Commitments for Employee and Labor Relations • Members of the Strategic Planning Team • Selected Strategic Planning Resources • Timelines, Sponsors, and Owners 32
    • Strategic Plan May 27, 2004 Principles and Commitments for Employee and Labor Relations The University of California is dedicated to serving society through teaching, research, and public service. UC strives to maintain a climate of fairness and cooperation, in order to foster the best possible working and learning environment. Therefore we are guided by the following principles and commitments for employee and labor relations. Principle l: The University is committed to recruitment, retention, and development of employees to be effective stewards of the public trust and to best support the University’s mission. Principle 2: The University is committed to having a diverse community of employees, working together toward accomplishing the University’s mission. Principle 3: The University values, and will recognize and reward individual and group achievement. Principle 4: The University is committed to creating an environment of civility and mutual respect among faculty, staff, students, and the public and expects integrity, professionalism, and accountability of its employees in all endeavors. In order to achieve these principles, the University commits to fostering, developing, and striving for the following: • Effective training and development strategies to support expertise and excellence in employees. • Fair compensation and adequate tools, resources, and working conditions for employees to carry out their responsibilities. • Effective relationships with its employees, advisory groups and labor unions, and respect for all employees’ choices about representation. When employees choose to be represented, the University supports collective bargaining, and supports the development of respectful and cooperative labor relations. • Collaboration between the Office of the President and the campuses, laboratories, and medical centers in a manner that respects and balances the needs, values, and responsibilities of all locations with those of the University as a whole. • Effective communication with the UC community and the public about ongoing employee and labor relations issues. 33
    • Strategic Plan May 27, 2004 Members of the Strategic Planning Team Judy Ackerhalt Executive Director, HR/B Strategy and Deputy to the Associate Vice President Michael Baptista Director, Information Systems Support Judy Boyette Associate Vice President, Human Resources and Benefits Gayle Cieszkiewicz Associate Director, Labor Relations Yvonne DeVaughn Director, Strategic Planning Michele French Executive Director HR/Benefits Policy and Program Design Susan Mathews Director, Senior Management Compensation and Benefits Kay Miller Executive Director, Client Relations and Diversity Rosemary Monroe Director, UCOP Human Resources Bill Neff Special Assistant to Assistant Vice President Boyette Howard Pripas Executive Director, Labor Relations Paul Schwartz Director, HR Communications Valerie Weller Coordinator, Strategic Planning Katherine Mitchell (UCB) Principal Analyst, Organizational Consulting 34
    • Strategic Plan May 27, 2004 Selected Strategic Planning Resources The HR Scorecard: Linking People, Strategy, and Performance Brian E. Becker, Mark A. Huselid, Dave Ulrich, Harvard Business School Press, MA, 2001 Organizational Vision, Values and Mission Includes values activity and templates for values cards Cynthia Scott, Dennis Jaffe, Glenn Tobe, Crisp Publications, Menlo Park, CA, 1993, (1-800-442-7477) Strategic Change in Colleges and Universities: Planning to Survive and Prosper Daniel Rowley, Herman Lujan, Michael Dolence, Jossey-Bass, San Francisco, CA, 1997 Strategic Planning Workbook for Non-Profit Organizations A step-by-step guide for developing, implementing, and updating a strategic plan Amherst H. Wilder Foundation, St. Paul, MN, 1990, (612-642-4025) Team-Based Strategic Planning: A Complete Guide to Structuring, Facilitating and Implementing the Process C. Davis Fogg, AMACOM, American Management Association, New York, NY, 1994 Also of interest The Empowered Manager: Positive Political Skills at Work Peter Block, Jossey-Bass Publishers, San Francisco, CA 1987 Facilitator’s Guide to Participatory Decision-Making Sam Kaner et. al., New Society Publishers, Gabriola Island, Canada, 1996, (415-641-4840) The Leadership Challenge: How to Keep Getting Extraordinary Things Done in Organizations James Kouzes and Barry Posner, Jossey-Bass Publishers, San Francisco, CA, 1995 35