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Photo Credit: Kayla Jones | Daily Texan Staff

Spend any time with your ear to the ground on campus, and you will be sure to hear some griping about Shared Services. The dispute, at its core, revolves around cost-cutting measures currently employed by the University on a pilot basis to weed out redundancies in the system. 

This much sounds noncontroversial, but the devil lies in the details, as always. The aforementioned “redundancies” are more than just numbers on an expense sheet — they are people’s jobs. More than 500 jobs could be slashed as a result of this new Shared Services plan, namely in finance, human resources, procurement and information technology. The plan would focus on strenuously consolidating administrative positions into fewer offices. Once again, perhaps on paper this looks like a no-brainer, but faculty and staff have expressed grave concerns with the effectiveness of fewer administrators providing support for such a wide assortment of services. Indeed, “sharing” the services may force many to bite off more than they can chew.

Another concern is the consulting firm Accenture, with its notorious mismanagement of aspects of the state’s food stamp and Medicaid programs, representation on the committee that recommended changes to the University and pricey bill for implementation. With all these problems, the plan presented looks to have more holes in it than a piece of Swiss cheese. 

Student and faculty support has been almost completely one-sided. For all except the especially zealous libertarian faction on campus, no one wants to see hundreds of job losses, especially when coupled with possibly inferior services. Some parts of the campus community have even mobilized completely against it. In late April, a protest was held in front of the Tower, followed by a sit-in at the office of UT President William Powers Jr.

Considering the major leadership transitions coming to UT in the next academic year, the brouhaha over this dispute will most certainly not be dying down anytime soon. And the conversation will be sure to include a diverse range of topics, as it always has.

Reasonable arguments exist on both sides of this dispute. On one hand, services that are actually duplicative do little to improve the University, and saving jobs just to save jobs appears frighteningly Luddite. And while there are sure to be opponents of this proposition with such a mindset, the dispute runs far deeper. If the savings produced by this program are miniscule once Accenture’s chunk of the profits is garnished, would it still be worth it to accrue such bad press? And a question that must be repeated once more is whether the allegedly overlapping services are actually capable of providing the same quality of service in the new no-frills environment.

Radio-television-film senior lecturer Anne Lewis helped author a letter to President William Powers Jr. opposing Shared Services. The letter has been signed by more than 100 faculty member in order to halt the possibility of approximatley 500 jobs being eliminated in the centralization process.

Photo Credit: Shelby Tauber | Daily Texan Staff

President William Powers Jr. received a letter signed by more than 100 faculty members opposing Shared Services on Tuesday. 

The letter — authored by radio-television-film senior lecturer Anne Lewis, English associate professor Mia Carter and law professor Julius Getman — petitions Powers to withdraw his endorsement of Shared Services, which he issued March 31.

Shared Services is a plan designed to save money by centralizing University human resources, information technology, procurement and finance services in various ways across campus. Kevin Hegarty, executive vice president and chief financial officer, has said approximately 500 jobs will be eliminated in the centralization process, primarily through attrition and retirement. 

Powers’ endorsement of the final report and findings of the Shared Services Steering Committee launched the first two pilot versions of the plan in the College of Education and the Office of the Provost. According to Mary Knight, associate vice president for financial affairs and member of the Shared Services Steering Committee, members of the committee have been meeting with the business officers of both departments to discuss the specifics of the pilot. 

According to Lewis, the letter from some faculty members is a more formal expression of an online petition opposing Shared Services with more than 1,000 signatures from students, faculty, staff and other members of the community. 

The letter focuses on various aspects of Shared Services, including the impact it could have on the support systems that exist between staff and faculty in a department. 

“A lot of [staff] have been at this university for a long time, and a lot of them have been in that department for a long time,” Lewis said. “They do multiple functions: They take care of each other, [and] they take care of us. It’s a creative function. We build these departments that way.”

Another concern listed in the letter is the involvement of Accenture, a consulting firm with a controversial history. The University has paid Accenture more than $4 million to assist in data collection and organization. Accenture also worked with the Committee on Business Productivity, the group that first recommended Shared Services. Two members of the Committee on Business Productivity and one member of the steering committee are former Accenture employees.

Communication between the administration and campus is another concern, according to Lewis. She said she questions whether the various meetings UT administrators had with the campus before pursuing implementation were genuine attempts to hear campus feedback. 

“Was the approach to campus really an attempt to have a discussion where Shared Services, or this approach to saving money, would be taken off the table and other options could be explored, or did it come to campus as a done deal with those town halls really being a PR effort to sell the campus on this?” Lewis said. “There are some things in the process that I could point to that lead me to the second.”

Knight said she is open to any conversations members of the faculty want to have about Shared Services.

“I hope most of campus is willing to give us a chance to show how it will work and how we really do want to engage the staff on campus and the faculty who will be using the services,” Knight said. 

Lewis said opposing Shared Services, regardless of whether she is completely against it, feels like the right thing to do. 

“I would hate to say that I’m totally against Shared Services,” Lewis said. “I’m not sure that’s even the point. It just feels like you’re kind of on a train that’s moving forward, and there’s very little that you can do to steer it without just standing in front of it.”

Photo Credit: Chelsea Purgahn | Daily Texan Staff

Administrators call the program a cost-saving, centralization initiative. Student protestors and some members of faculty council claim the plan will “dehumanize” certain University services, lead to an undetermined number of layoffs and increase the pressure on the staff who remain. Amidst the controversial claims, one fact is certain: as Kevin Hegarty, vice president and chief financial officer, told The Daily Texan in January, “Shared Services is not a matter of if, it’s a matter of when.”

The Committee on Business Productivity, a group charged with identifying ways for UT to cut costs, first introduced the idea of Shared Services in January 2013. Since then, the Shared Services Steering Committee has worked to determine how to implement the initiative on campus. The committee presented its final report and recommendations to President William Powers Jr. earlier this month.  

Since its introduction, Shared Services has been defined in many ways by different parties across campus, and the steering committee itself has undergone multiple roster changes at the request of student and faculty governance groups. Student protestors also oppose the involvement of Accenture, a consulting firm with a controversial history, in the plan’s development. Meanwhile, across the country, other universities have begun to adopt Shared Services plans — with varying levels of success. 

For administrators, Shared Services means cutting costs by centralizing services. At present, various colleges, departments and units across campus organize and deliver their procurement, finance, human resources and information technology services in different ways. According to Hegarty, 500 positions will be eliminated through the centralization process — ideally through natural attrition and retirement.

“Rather than Shared Services, it’s really sharing resources — sharing people,” Hegarty said. “We have people all over the campus, down to the department level, that do very similar activity. … These people do essentially the same thing. This whole concept is, if you amalgamate that work into fewer, more concentrated units, you achieve potentially a different result.”

According to the steering committee’s report, implementing Shared Services will cost the University approximately $35-$40 million. Each year thereafter, the University’s projected savings will sit somewhere between $30-$40 million annually, Hegarty said.

Some members of the UT community have voiced their concerns about the limited amount of hard data and evidence currently available to support the administration’s claims of increased productivity. The Faculty Council passed a resolution in January requesting more information about Shared Services and also asked the committee to add two non-administrative UT employees to its ranks. After the resolution passed, one faculty member and one staff member were added to the committee. 

A month later, the Graduate Student Assembly also passed a resolution regarding Shared Services, requesting more information about the initiative and for a graduate student to be added to the committee. A graduate student was added to the committee after the resolution was passed.

“The issue isn’t with Shared Services; The issue is with the manner in which it’s being rolled out,” said David Villarreal, communications director and president-elect for GSA and one of the resolution’s authors. “The only thing we really need is our involvement. At the end of the day, we’re not trying to stop Shared Services in its tracks. We’re just saying, as it’s being developed, let us know what’s going on so that we know and so that we can be part of the conversation.”

Villarreal said he is concerned about the projected elimination of 500 positions.

“[Hegarty] has outlined a plan that explained how this would happen, under the assumption that those 500 jobs would be voluntarily eliminated within an extremely short calendar,” Villarreal said. “If he had given a more realistic plan and one that just didn’t paint the rosiest of pictures on the job loss, I would probably have helped him and supported him at the end of the day.” 

According to Hegarty, UT already lays off 150-200 individuals every year. Hegarty said individuals criticizing the plan do not understand that the University’s current business model is not sustainable.

“We’re getting starved on the academic end for dollars to hire teachers and retain people,” Hegarty said.

In February, hundreds of students, university employees and community members marched on campus against the Shared Services Plan. Bianca Hinz-Foley, Plan II junior spokeswoman for United Students Against Sweatshops, said she is primarily concerned with Accenture’s involvement in the Shared Service initiative.

As well as assisting in the project management of the Committee on Business Productivity, Accenture also played a role in collecting data for the steering committee. According to Hegarty, the combined cost of these services amounted to more than $4 million. Two members of the Committee on Business Productivity and one member of the steering committee are former Accenture employees.

“Some of the big movers and shakers behind the Shared Services Plan at UT are either current or former Accenture executives,” Hinz-Foley said. “That’s troubling because we want the University to make changes the community wants and not something an outside corporation wants to implement.” 

In 2006, the legislature outsourced the call centers for the state’s food stamps and Medicaid programs to Accenture in an effort to save money. The state terminated the contract in 2007 after issues with technical operations led to problems with benefit distribution. According to a report from the Austin-Statesman in 2009, the state of Texas paid Accenture approximately $243 million for their services.

UT is not the only university with ties to Accenture. The University of Michigan has an approximately $11.7 million contract with Accenture for cost-cut consulting, including Shared Services. Since 2003, the University of Michigan has paid Accenture a total of about $19.4 million, according to documents provided by Michigan spokesman Rick Fitzgerald. 

“We used Accenture, the consulting firm, to help us identify areas [conducive to shared services], how much we might save, what the scope of the operations that could be pulled into a shared services operation — so that’s been going on for a couple of years,” Fitzgerald said.

In November 2013, approximately 1,000 faculty members signed and submitted a letter to Michigan administrators, criticizing the centralization efforts. Fitzgerald said Michigan’s plan for implementing Shared Services was altered as a direct result of this sort of feedback from faculty.

“What we found as we started rolling this out is that the campus community, primarily the faculty, didn’t really have enough information about how [shared services] would be working,” Fitzgerald said. “We learned that we needed to slow down the process and make sure we gave the schools and colleges more time to figure that out.”

The University of California-Berkeley is currently in the process of finalizing the implementation of shared services on their campus. According to Berkeley spokeswoman Melanie Hurley, Campus Shared Services, which was launched in January 2013, currently provides business and financial services to 60 percent of the campus. 

Hurley said Campus Shared Services was developed through more than 20 “work groups” on Berkeley’s campus. 

“Throughout implementation, the team has relied on campus work groups made up of staff, faculty and students who collaborate with [Campus Shared Services] staff to identify the most effective processes for Berkeley,” Hurley said in an email. 

According to Hurley, savings will not actualize until the 2016 fiscal year, when Berkeley will see $6.9 million in annual savings. Hurley said, by 2020, annual savings are predicted to increase to $13.7 million.  

At UT, Hegarty said the end goal of Shared Services is to ensure that the University can operate efficiently.

“We want to minimize administrative costs to maximize investment in our core missions,” Hegarty said. “We’re not in the business of just doing administration for the sake of doing administration. We’re not in the business of just employing people for the sake of employing people.”

William Beckner, chair-elect of the Faculty Council, presents his annual report at a Faculty Council meeting at the tower on Monday afternoon.

Photo Credit: Shelby Fry | Daily Texan Staff

As the Senate of College Councils president, I’ve written for the Texan on a number of University-related issues, the majority of which the organization I represent had taken a stance on. 

Today, however, I am writing about an issue, Shared Services, which Senate has not yet spoken on, and, consequently, these thoughts are only my own and not those of Senate.

Shared Services came about as a part of the Report on Business Productivity, in which business leaders examined the operations of UT to determine areas where the campus could optimize efficiency. Although there has been a robust dialogue on this project so far, it feels at times like only the side of the detractors is being told. 

There are a few recent examples of this one-sidedness. First, a January Faculty Council meeting where some faculty members inserted politically charged language into an otherwise well-intentioned resolution questioning Shared Services. Second, a Feb. 7 protest orchestrated by the Texas State Employees Union and the UT Save Our Community Coalition condemning the University. Finally, there was even a recent tongue-in-cheek denunciation of McCombs School of Business Dean Tom Gilligan’s position on Shared Services published in this newspaper. These dramatic reactions create a dialogue that is harmful to the whole process and prohibit a reasoned debate.

One major call from detractors of the proposed plan is that they want to see the data which has led the University to consider Shared Services. Some of these detractors even imply that the University’s inability to produce data immediately means that it has something to hide. This is simply not the truth. 

When UT contracted the consulting firm Accenture to work on the Task Force on Business Productivity, the firm was charged with examining UT operations to locate inefficiencies. Using professional expertise and information on UT, they made the determination that the University could save up to $30 million annually by centralizing operations like human resources, payroll, IT and procurement. Vice President and Chief Financial Officer Kevin Hegarty then assembled multiple committees made up of UT staff and faculty to examine the claim and verify its validity. It was determined that the figures were accurate, and so Hegarty spent the better part of the fall semester attending meetings and hosting town hall forums to engage as many people as possible on the project and solicit feedback from the campus. The data people seek is forthcoming, but it will not be here until units such as the College of Liberal Arts and the McCombs School of Business, both of which are part of a pilot Shared Services program designed to see how much the model could actually save, have completed their trial runs of the program. The claim that the campus is jumping into something without adequate information is false. The process has been reasoned, public and cautious.

Admittedly, the involvement of Accenture in Shared Services is a complicated subject, which certainly could have been more transparent. Much has been said about Accenture’s spotty history with the State of Texas, during which several contracts between the state and the company were canceled for their failure to provide the services requested. 

The sentiment among detractors of the Shared Services project seems to be that, because Accenture’s services were once inadequate, their efforts at UT are destined to fail. The logic of this argument seems to line up with the old saying about throwing the baby out with the bath water. Just because some of Accenture’s employees may have made mistakes in the past does not mean the entire company is full of people who cannot be trusted to deliver on their contract. With as much as Accenture recruits new hires on our campus, I would guess that many upperclassmen are like me and have friends employed by Accenture. Certainly in my case, their character didn’t change by being attached to the name Accenture.

Shared services is not an uncommon practice; it has been implemented by several other large universities and systems, such as the University of California institutions, Michigan, UNC, Wisconsin, Purdue, NYU and Yale to varying degrees. It has long been a practice in the private sector, too. Why? Because it increases efficiency and thus lowers overall costs. In today’s fiscal climate, every dollar matters. Any improvement that can be made benefits the University and all of its students, faculty and staff. It is absolutely true that losing 500 jobs, as the report calls for, would be a major change to the status quo. However, this reform will be done largely through attrition; the alternative to implementing Shared Services, by keeping the current course, would result in layoffs. And, as Faculty Council Chairwoman Hillary Hart reported at the January meeting, UT is already averaging 250 layoffs annually. In this situation, not only does the University sacrifice efficiency, but people who want to work here are losing their jobs.

What we really need is the return of an informed dialogue on Shared Services, rather than charged rhetoric on data and Accenture. Moreover, this process needs to be driven by those potentially affected by this project: the University’s hardworking staff members. It is disappointing to say the least when a faculty member who disagrees with the idea of Shared Services calls the president of the Staff Council a “lackey” for being open to a pilot program. This is not an environment that encourages reasoned debate on the merits of the University’s plan or lack thereof. Let’s be open to the idea of a pilot program, so that this can be studied further. This is an opportunity today to help shape UT for the future and we should not allow it to be squandered.

University finances across the country are in the midst of a long-term transformation, challenging higher education leaders to respond strategically to control costs while continuing to deliver value to students.

Documenting the financial threat to “business as usual,” the American Council on Education in late 2012 highlighted that, despite growing demand for higher education since the mid-1970s, U.S. public funding has been in retreat for the past three decades, with 2011 funding for public universities down by 40.2 percent, compared to fiscal year 1980. A March 2013 report from the National Association of State Budget Officers, financed by the Bill & Melinda Gates Foundation, focused on the increasing difficulty for public colleges to offset declines in state revenue by raising tuition, and advocated strong action to increase administrative efficiency in higher education.

This dynamic has led universities around the country to join forces to share investments such as software licenses, health services and science facilities, and to streamline administrative functions — such as HR, accounting, procurement and IT — that can consume more than 20 percent of university budgets.

UT President William Powers Jr. has emphasized the importance of achieving new administrative cost savings and efficiencies to free up resources for the University’s core missions of teaching and research. This ongoing effort is a difficult but important aspect of making UT-Austin the best public university in the country. Powers knows great organizations never stop trying to improve how they operate.

There is neither a one-size-fits-all solution for university financial woes nor one type of reform initiative sufficient to address all financial challenges. But fundamental benefits of standardizing some transactional administrative processes via shared services — reducing costs through economies of scale, increasing opportunities for administrative staff and improvements in service quality standards — make the approach increasingly attractive to higher education. This is why shared services are being piloted at UT-Austin, and why the McCombs School of Business has already implemented some shared services and is now participating in the new initiative at the pilot stage.

The University has made headway over the past year in part by drawing on appropriate outside resources to provide the expertise and staff needed to advance the drive for greater administrative efficiency in a timely manner, including charting a pathway targeting savings of $30-40 million annually in perpetuity.

A well-respected global firm with a large presence in Texas, Accenture focuses on helping businesses, government agencies, educational institutions and nonprofits to operate more efficiently and improve services. The firm has a long history of successfully serving business, government and education organizations in Texas, with more than 1,000 employees in Austin and strong ties to UT for recruiting new graduates.

The University appropriately selected Accenture to support the UT-Austin-driven effort to assess approaches to achieve greater administrative efficiency. Shared services was not and is not an Accenture initiative. It was launched and has been managed by the University, and, as the project moves into pilot phase in units around campus, Accenture’s role, supporting the assessment and planning phase, has concluded.

As Powers said, UT-Austin is already one of the most efficient and effective public universities in the nation. A pervasive spirit of restlessness and discontent with the status quo is a large part of what makes it so, and is essential to advancing Powers’ goal of making UT-Austin the number-one public University in America. Shared services deserves to be in the mix of ways that UT-Austin can improve quality, increase efficiency and keep a lid on cost increases. This way, the University can focus more resources on student and faculty needs in the long term.

Thomas Gilligan is the Dean of the McCombs School of Business. 

Despite campus closure, several hundred students protest the university’s Shared Services Plan in front of the Tower Friday afternoon. In an attempt to centralize several of the University’s services, it is predicted that at least 500 jobs will be eliminated. 

Photo Credit: Jenna VonHofe | Daily Texan Staff

Since October 2013, one of the most contentious administrative issues on campus has been Shared Services — an initiative that will centralize the University’s finance, human resources, procurement and information technology services in an attempt to save more than $30 million per year

The centralization will likely eliminate 500 university jobs, primarily through natural attrition and retirement. When Kevin Hegarty, the University’s executive vice president and chief financial officer, first addressed the shift to Shared Services last year, these lost jobs seemed to be the most controversial aspect of the proposal, at least in the eyes of students. Soon after, though, faculty and students alike pointed to other concerns, including the hefty price tag of the implementation — up to $180 million combined for both Shared Services and switching to a new business-management software system — as well as the University’s decision to hire consulting firm Accenture to assist with the project’s implementation. 

The University’s decision to hire Accenture has been a heated issue because of the close relationship many of the individuals on UT’s Committee of Business Productivity have with the firm, as well as Accenture’s involvement in past mishaps in the public sector. As the Daily Texan has reported, the committee chair, Stephen Rohleder, served as chief executive of Accenture’s Health and Public Service division. The subcommittee that recommended that UT’s operations be centralized into shared services was chaired by Stephan James, a 38-year Accenture veteran. And three of six people on the Shared Services Steering Committee are Accenture employees, with one being a former Accenture executive. 

As for Accenture’s contentious history, in 2006, a Texas Medicaid and Children’s Health Insurance Program run through Accenture encountered so many problems, including long-wait times for callers and unreceived medical benefits for children, that the contract was canceled prematurely. 

According to Hegarty, who spoke to the editorial board about Shared Services on Thursday, the University hired Accenture to implement the beginning stages of Shared Services because the consulting firm had an existing contract with a Texas agency, and the University could easily latch onto the same contract without having to initiate a competitive bidding process separate from the one that had already occurred. Yes, as Hegarty repeatedly said Thursday, this action was a completely legal one. But we don’t believe the legality of the decision makes it any less an example of partiality on the part of UT officials. 

Friday, more than 300 students protested against the University’s relationship with Accenture, despite the fact that the campus was closed for winter weather. The protest’s goal was to encourage the University to terminate its relationship with Accenture. Anne Lewis, a senior radio-television-film lecturer who spoke at the rally, told the Texan editorial board that her biggest concern about UT’s relationship with Accenture lies in the “DNA alteration of the University we love and value in support of a corporate project. … This is worrisome because we are using a private model for a public institution; there’s a great deal of money going into this and the published figures are incorrect.”

In other words, Lewis believes that “both the model and the specific company are troublesome.” To remedy the situation, both Lewis and Bianca Hinz-Foley, Plan II junior and a spokeswoman for United Students Against Sweatshops (a student group that took part in the protest), want the University to terminate its relationship with Accenture. But that’s both unlikely and unreasonable. 

The truth is Shared Services is not and should not be an issue. Given the University’s current budget shortfall, it may very well prove to be a reasonable, timely and cost-saving initiative. With rapidly declining state funding and a freeze on tuition, it’s imperative that the University consider cutting costs in administrative areas, rather than cutting back on the quality of education that it provides students. And in regard to the new ERP system: It’s about time. Our current system is 25-30 years old. For technology, that’s ancient. 

So yes, UT needs to spend the money on an updated system. UT needs a Shared Services model. But that doesn’t mean everything in this arrangement is kosher. 

As Hegarty said repeatedly, “The devil’s in the details.” The details indicate that hiring Accenture without a separate competitive bidding process was inappropriate; a separate bidding process would have insured that no nepotism was at play in hiring the firm responsible for implementing Shared Services. Although paying for Shared Services or the ERP system won’t cut into our University’s operating budget now, it easily could if something goes wrong. After all, the money has to come from somewhere. 

Shared Services and the much-needed ERP upgrade should benefit the University, both in terms of efficiency and profitability. But, by not competitively bidding out the contract for the Shared Services implementation, the University has increased the risk, however small, that the system or the ERP software isn’t the best one for UT. This irresponsibility is the main issue at hand, and it’s one that should not be acceptable.

Photo Credit: Jenna VonHofe | Daily Texan Staff

Several hundred students, faculty and community members marched across campus in protest of the University’s Shared Services Plan, despite campus being closed for “winter weather” Friday.

The Shared Services Plan is a list of recommendations intended to save money by centralizing the University’s finance, human resources, procurement and information technology services. University officials predict that 500 jobs will be eliminated — primarily through natural attrition and retirement, according to officials — as a result of this centralization. 

The UT Save Our Community Coalition, a collection of student groups on campus including United Students Against Sweatshops, partnered with the Texas State Employees Union, the University Leadership Initiative and several other organizations to voice their concerns about UT’s partnership with management-consulting company Accenture for the implementation of the Shared Services Plan.

In 2006, the state outsourced the call centers for the state’s food stamps and Medicaid programs to Accenture in an effort to save money. The state terminated the contract in 2007 after issues with technical operations led to problems with benefit distribution.

Anne Lewis, senior radio-television-film lecturer and Texas State Employees Union Executive Board member, spoke at the protest about the importance of a community rallying together to preserve its ideals.

Lewis said a petition has been opened to UT faculty in opposition to the UT-Accenture plan. Lewis said between 400 and 500 signatures have been collected so far.

“I’m not sure if the petition will change anything,” Lewis said.

Plan II junior Bianca Hinz-Foley, spokeswoman for United Students Against Sweatshops, said around 300 people showed up to the protest, which was held on the eve of a two-day United Students Against Sweatshops national conference held in Austin. Hinz-Foley said her organization’s main goal is to convince the University to discontinue collaboration with Accenture.

“We’re calling on UT to cut ties with Accenture altogether,” Hinz-Foley said. “Accenture is the worst of the worst. It’s not that they’re inefficient, it’s that they’re fundamentally corrupt with their model.”

UTPD officers accompanied the protesters to ensure their safety and keep traffic unaffected, according to UTPD Capt. Gonzalo Gonzalez. Gonzalez said the protest was generally peaceful, but it did create a disturbance when protesters physically blocked the street traffic on Guadalupe, while dancing and chanting.

On Thursday, Kevin Hegarty, executive vice president and chief financial officer, responded to a resolution from Faculty Council asking for more information about the Shared Services Plan.

Hegarty agreed to add a non-administrative faculty member nominated by the Faculty Council Executive Committee to the Shared Services Steering Committee. He also included information about Accenture’s role in the plan.

Hegarty said Accenture worked with the Committee on Business Productivity, which recommended implementing Shared Services to the University. He said Accenture also played a role in gathering data for the steering committee to determine the potential success of implementing Shared Services at UT, a service that will be completed in February.

According to Hegarty, the combined cost of these services totals more than $4 million, but there is no current contract with Accenture for future services.

Photo Credit: Chelsea Purgahn | Daily Texan Staff

Kevin Hegarty, executive vice president and chief financial officer, submitted a response to a Faculty Council resolution requesting more information about the Shared Services Plan on Thursday morning.

In his response, Hegarty agreed to add a non-administrative faculty member nominated by the Faculty Council Executive Committee to the Shared Services Steering Committee. Hegarty also included information about the role of management-consulting company Accenture in the implementation of Shared Services and a list of the University units that volunteered to participate in a pilot version of the plan.

The plan consists of a list of recommendations — scheduled to be submitted to President William Powers Jr. in the coming months — designed to cut costs through the centralization of human resources, finance, information technology and procurement services at UT. The plan also outlines the elimination of at least 500 jobs, which, according to University officials, will take place primarily through natural attrition and retirement. 

Faculty Council passed a resolution requesting more information about the plan at their January meeting. The resolution, authored by the Faculty Council Executive Committee, asked Hegarty to share specifics of the Shared Services Plan with the public. It passed by a vote of 28-3.

“We would like to emphasize the need in all discussion on campus for transparency,” said William Beckner, mathematics professor and chair-elect of Faculty Council, at the meeting. “We would like to have information about how the pilots are progressing.” 

The resolution requested a variety of data, including an explanation of Accenture’s role in Shared Services.

In his response, Hegarty said Accenture played a role in the Project Management for the Committee on Business Productivity, which aims to identify opportunities to cut University costs. Hegarty said Accenture also played a role in developing data for the steering committee to determine the potential success of Shared Services at UT. According to Hegarty, the combined cost of these services is more than $4 million. 

Hegarty said there is no current contract with Accenture.

The resolution also asked Hegarty to disclose which University units have already volunteered to participate in a pilot version of the plan. Hegarty provided a list of 11 units that have volunteered, including the College of Liberal Arts, the College of Education, the McCombs School of Business, the Moody College of Communication, the Jackson School of Geosciences, the Dell Medical School, the Portfolio of the Chief Financial Officer, the Central Business Office, the President’s Office and the University Athletics Administrative and Business Affairs. 

Hegarty also provided a list of higher-education institutions which have already implemented their own versions of Shared Services, which UT will be observing. The list includes multiple campuses at the University of California, the University of Michigan and Yale University.

Hillary Hart, engineering senior lecturer and chair of Faculty Council Executive Committee, said she appreciated Hegarty’s prompt response. 

“The more I know about this and compare it to how things were done at Michigan and Yale — the two other Shared Services at universities I know the most about — we are just approaching it so differently,” Hart said. “I think [Hegarty] made a really good start on responding to the resolution and providing the information
we requested.” 

As the University develops its Shared Services Plan, members of the UT community continue to debate the role of management-consulting company Accenture in the plan’s implementation. 

The plan, first introduced in October, consists of a set of recommendations to centralize University services. University officials said the plan calls for the elimination of 500 jobs primarily through attrition and retirement.

The Shared Services Plan came out of a report released in January 2013 by the Business Productivity Committee, a group formed to identify ways to cut costs in the University’s administrative functions. The committee was chaired by Steve Rohleder, a UT alumnus and an executive at Accenture. 

In 2006, the state of Texas outsourced the call centers for the state’s food stamps and Medicaid programs to Accenture in an effort to save money. The state terminated the contract in 2007 after issues with technical operations led to problems with benefit distributions. 

According to Kevin Hegarty, UT vice president and chief financial officer, Accenture is working with UT to determine whether implementing Shared Services would benefit the University. He said he considers Accenture to be a highly trusted resource.

“The engagement [with Accenture] is just about done,” Hegarty said. “They’re wrapping that up now. There is no doubt we will move forward, if we move into pilots — which I believe we are — with a consulting firm, but when it comes time to do that we will go out and, like we typically do, do a statement of work saying ‘here are the services we need,’ send it out into the market and let anybody and everybody that’s interested bid.”

On Monday, the Faculty Council passed a resolution which included a request for specifics regarding Accenture’s role in the Shared Services Plan. The UT Save Our Community Coalition, a collection of student organizations, will hold a press conference Thursday in protest of Accenture’s involvement in the plan.

“I think that that’s frightening that we’re willing to take such a big risk given everything we know about this company and given all of the concerns that faculty, students and staff have raised about this company,” said Bianca Hinz-Foley, Plan II junior and a student representative in the coalition.

Currently, the Business Services Committee is overseeing the implementation of Workday, a new enterprise resource planning software commonly associated with Accenture.

Mary Knight, associate vice president and a member of the Business Services Committee, said they are in the process of evaluating multiple proposals for a new Workday implementation consultant but said she could not disclose any specifics.

In 2006, the Texas Comptroller denounced consulting firm Accenture’s mishandling of Texas welfare, Medicaid enrollments and the Children’s Health Insurance Program. Instead of saving the state money as the company had promised, Accenture cost the state $99.9 million more than their budget had allowed. Because of Accenture’s shoddy work, families in need were wrongly denied food stamps, many health insurance applications were mistakenly faxed to a warehouse in Seattle and 81,504 children lost health insurance coverage in just 9 months — some of them seriously ill. The State of Texas has since terminated its contract with Accenture, but not before paying $243 million for these horrors.

Now some students worry about Accenture’s plans to transform UT in the form of the University’s new Shared Services plan, which will begin being implemented this semester and which was planned with the help of Accenture. 

In 2011, the chief executive of Accenture’s Health and Public Service, Stephen Rohleder, published an op-ed in the Austin American-Statesman in which he argued that public institutions, such as UT-Austin, should adopt shared services practices from the private sector. Rohleder worked with Accenture for 30 years, several of them as a chief operating officer at the company. 

Months later, Rohleder chaired a committee advising UT on business productivity. UT paid Accenture staff $960,000, without competitive bidding, meaning that no other companies were given a chance to compete for the contract. A subcommittee chaired by Stephan James recommended that UT’s operations be centralized into shared services in the process, eliminating hundreds of jobs. James, too, was an Accenture executive, for 38 years, and another chief operating officer. 

Given Accenture’s past history, some faculty and students voiced concerns about the company’s involvement in the initiative last semester.

UT’s Chief Financial Officer Kevin Hegarty replied, “Shared Services at UT is not an Accenture-driven project.” At a faculty meeting, Hegarty also admitted, “If it’s an Accenture plan, it’s not going to be successful.” 

But even after the original proposal was finished, Accenture’s involvement on the UT campus continues. The project team tasked with creating the  UT Shared Services plan has six leaders, including three Accenture executives, Tim Mould, Ryan Oakes, Jamie Wills, plus a former Accenture executive, Brad Englert, now the University’s chief information officer. 

To implement the Shared Services plan, administrators will have to buy a “hugely expensive” system called Workday for more than $100 million. Workday publicizes its Services Partners, and its first partner is Accenture — despite the fact that Workday does not list its partners in alphabetical order. Accenture even describes itself as  “one of Workday’s most strategic, experienced and successful deployment partners,” further underscoring the relationship between the company and Workday.

Englert will oversee the implementation of Workday. Julienne VanDerZiel, another Shared Services planning leader, is also a former Accenture executive.

It remains to be seen how their experience at Accenture will affect the University. 

Accenture developed shared services for the University of Michigan. At a meeting of UT’s Staff Council, Hegarty explained the importance of Michigan’s Shared Services as a model for implementing the system at UT: “They’re probably the closest institution to us of any out there. They’re about the same size, the same scope, everything. And so we think: That’s really a good test case to look at, watch and monitor …. They look very, very much like we look when you look at how they’re organized.”

And what does shared services look like at Michigan? It looks like Michigan has paid $22.5 million for Accenture’s shared services to cut 50 staff jobs and relocate 275 jobs out of other departments. Longtime employees must reapply for jobs, which they might lose. Department chairs received “an unprecedented gag order” not to discuss shared services. An investigative committee of alumni and students concluded that Accenture “cannot be trusted with the University of Michigan’s financial management, its IT systems or with other sensitive information.” They begged for the vice president of finance, a former Accenture executive, to be replaced immediately to avoid conflict of interests. 

Michigan’s IT Governance Council complained that Accenture underestimated costs and overestimated savings. Finally, scores of Michigan professors denounced shared services as “a misguided venture that will irreparably harm our cherished institution.” An unprecedented 1,169 faculty have signed a petition, including the chairs of 29 departments. They begged their president to terminate the project immediately: “We implore you to restore sanity to the University.”

But UT, which has just begun the implementation of the Shared Services plan on campus, can prevent a similar crisis before it begins at home. I urge that instead of paying companies in California, Ireland and Bermuda through Accenture, UT should hire UT staff and Texas programmers to custom build its administrative systems. 

Alberto A. Martinez is a member of the UT Faculty Council, and an associate professor in the department of history.