Our approach to this project has been consultative; sharing information with many individuals and groups across campus including deans, representatives from colleges and administrative units, committees of council, financial staff and others.
- a Responsibility Centre structure;
- revenue allocation (of both tuition revenue and provincial operating grant revenue) to those units responsible for generating that revenue;
- expense allocation (of both direct and indirect expenses) to those units that benefit from the expenditure;
- a central fund (strategic initiatives fund); and
- a transition period
refine critical design features;
- begin to address policies such as research overhead and fee for service; and
- further develop model revenue drivers (e.g., teaching activity, student enrolment) and cost driver information (e.g., square meters).
There are three main phases of the project:
Phase 1: Model Research and Concept Development (January 2009 – Spring 2011)
Research on best practices and models at other universities – University of Toronto, University of Otago (New Zealand), Indiana University-Purdue University Indianapolis, University of Michigan and Iowa State University. We have learned from other institutions through detailed research that a Responsibility Centred Management (RCM) model approach would be a preferred alternative to our current budget system. The RCM approach involves decentralization of responsibility for revenues and costs to Responsibility Centres (RC) such as colleges, schools, research and administrative units. Since the 1970s some colleges and universities in North America and beyond have utilized some form of RCM, which relies on activity-based budgeting.
In addition to background research, Phase 1 includes the development of high-level model concepts, called critical design features, which include:
Phase 1 of the project involved discussion and information-sharing, during which normal budget processes apply. Phase 1 concluded with PCIP and Board of Governors approval in principle (May 10, 2011) of the concepts and general approach.
Phase 2: Model Development (Spring 2011 – Spring 2012)
In phase 2 the model will be more fully developed and begin to inform PCIP’s decisions. In this phase we will:
Phase 2 will also involve a simulation period of the high-level model, which will include consultations with colleges and units. Distribution of planning parameters in Spring 2012 marks the end of phase 2 and the beginning of implementation as defined by the PCIP (when the model is used to inform decisions).
Phase 3: Implementation and refinement (Spring 2012 and beyond)
Phase 3 is about application of the model and during this phase there will be a more wholesome alignment with our budget cycle. Time will be needed to gather and review information to develop policies before the model can be fully implemented and integrated into our normal processes, around 2014-15. Periodic reviews will take place in advance of planning cycles.