University of North Carolina at Chapel Hill

1. University of North Carolina at Chapel Hill Carolina Counts Executive Orientation January 8, 2010

2. Objectives for today • Understand • where we are and where are we headed • the process (is this Business as Usual?) • roles and responsibilities of the team leaders, Champions, and Carolina Counts • Agree on next steps 091228-UB2-Jan 8 Exec Orientation v4

3. Agenda • Our Mission and Objectives • Overview of the Program Phases • Organizing for Successful Change at UNC -- roles, responsibilities and accountability • Next Steps • Questions and Comments 091228-UB2-Jan 8 Exec Orientation v4

4. Mission and Objectives Mission To make the University of North Carolina the most collaborative, well-managed university in the country Objectives • To streamline campus operations and provide more funding for academics and University’s core missions • To implement simpler, more responsive systems and processes that enable informed decision-making while complying with policies and laws • To reduce bureaucracy and create a more satisfying work environment for faculty and staff 091228-UB2-Jan 8 Exec Orientation v4

5. Initiative Champions Initiative Area Champion 091228-UB2-Jan 8 Exec Orientation v4

6. Agenda • Our Mission and Objectives • Overview of the Program Phases • Organizing for Successful Change at UNC -- roles, responsibilities and accountability • Next Steps • Questions and Comments 091228-UB2-Jan 8 Exec Orientation v4

7. Let’s start with common definitions Program • Entire UNC operational improvement effort • Comprised of 10 Initiatives Initiatives • 10 improvement areas identified in Diagnostic phase • Led by Champions Projects • Specific projects within each initiative designed to achieve identified targets • Identified by Champions/Carolina Counts • Led by Team Leaders and executed by Project Teams Program Office Carolina Counts • Partners with Champions and Teams • Provides structure, tools, know-how to project teams; coordinate and tracks Projects across Initiatives

8. We have begun analysis and design; 2 key activities in this phase Diagnostic(early 2009) Planning & Resourcing(late 2009) Analysis and Design(early 2010) 1 2 Execution • Drive implementation and organizational change 091228-UB2-Jan 8 Exec Orientation v4

9. Savings and Improvement targets will result from detailed analysis 1 Bain Identification of Savings/Improvements Analysis of Targeted Savings/Improvements • Identified high-potential savings areas and quantified achievable savings • Established UNC cost baseline • Savings targets quantified based on benchmarking and Bain experience • Savings made conservative with “haircut” • Champion and Carolina Counts identify projects and teams • Carolina Counts provides tools and structure to Champions and team leaders and consolidates/ tracks projects for the Oversight Committee • Project team designs projects and identifies cost savings and performance improvements • Champions approve project design, timeframes, and results 9

10. Sample Detailed Analysis: Procurement 1 Steps Activities 091228-UB2-Jan 8 Exec Orientation v4

11. Detailed implementation plans developed to achieve targets 2 • process/policy/work streams Project Team Recommendations • skill set/staffing restructure • savings/impacts • yes/no/objections Advisory Group Review/ Champion Approval • resource authorization • phases/timeframes • authority for changes Implementation TeamFormation • required resources • broad based participation • standard template Project Workplan • objectives/savings • milestones/timelines • activities/owners • measurements Phased Implementation • workflow/skill set redesign • budget revision 091228-UB2-Jan 8 Exec Orientation v4

12. Illustrative Sample Project Workplan 2 Process Deliverable • Carolina Counts createsworkplan template • Team Leaders populate and update template on the website • Carolina Counts to consolidate/update overall status report • Living document, used by Team Leaders, Initiative Champions and Carolina Counts to manage team effort 091228-UB2-Jan 8 Exec Orientation v4

13. Illustrative Sample Project Workplan 2 091228-UB2-Jan 8 Exec Orientation v4

14. Is this Business as Usual? This Program requires: • Broad input and buy-in from across the University • Cross-University coordination and teaming • An aggressive timeline for results • Tracked results and accountability for those results • Partnership between Carolina Counts and Initiative Areas • A Program Office (Carolina Counts) to ensure initiatives become part of the institutional memory and can be repeated/enhanced • A continuous improvement program/process that becomes an integral part of the Carolina culture 091228-UB2-Jan 8 Exec Orientation v4

15. Is this Business as Usual? www.nytimes.com ALL THE NEWS THAT’S FIT TO PRINT 11/15/09 UNIVERSITIES TURN TO CONSULTANTS TO TRIM BUDGETS February 2010 “There’s no reason we can’t conduct nonacademic functions as efficiently as possible.” “We can make Carolina the most collaborative and best-managed university in the country.” Holden Thorp, UNC-CH Chancellor Note: Kiplinger headline is quote from Holden Thorp. Source: University website; New York Times; Kiplinger; Lit Search 15

16. Agenda • Our Mission and Objectives • Overview of the Program Phases • Organizing for Successful Change at UNC -- roles, responsibilities and accountability • Next Steps • Questions and Comments 091228-UB2-Jan 8 Exec Orientation v4

17. The design phase is about Change – 70% of org leaders have seen change initiatives fail “It should be borne in mind that there is nothing more difficult to handle, more doubtful of success, and more dangerous to implement than initiating change.” “Innovation makes enemies of all those who prospered under the old regime and only lukewarm support is forthcoming from those who would prosper under the new. Their support is indifferent partly from fear and partly because men are generally incredulous, never really trusting new things unless they have tested them by experience.” Machiavelli, The Prince, 1513 091228-UB2-Jan 8 Exec Orientation v4 Note: N=562. Sample across industries and size continents. Source: Taking Stock survey by The Change Management Toolbook, February 2005

18. With effective approach to change With poor approach to change An effective approach and program increase the likelihood of success How successful leaders approach change • Start with a clear change plan • Set an ambitious, yet achievable, goal • Inspire and motivate action • Execute with impact and speed • Embed capabilities into the organization 5xmore likely 4x more likely 091228-UB2-Jan 8 Exec Orientation v4 Source: Prosci Best Practices in Change Management 2007

19. Program roles and responsibilities Role Major Responsibilities Oversight Committee Oversight & Decision Making Carolina Counts(Program Office) Guidance, Know-how, Tracking, and Coordination Initiative Champions Initiative Leadership Project Team Leader Project Management

20. Program roles and responsibilities Role Major Responsibilities Oversight Committee Oversight & Decision Making • Provide overall direction • Obtain funding for Initiatives • Make key decisions (e.g., scope) and help Program Office focus and target • Resolve conflicts, approve policy, and make organizational changes 20

21. Program roles and responsibilities Role Major Responsibilities Carolina Counts(Program Office) Guidance, Tracking, and Coordination • Coordinate and manage interdependencies across all Initiatives • Participate in team meetings, assist in projects through tools, know-how, and templates • Track progress vs. milestones , consolidate, and report • Provide input and guidance to key decisions • Escalate issues to Oversight Committee 21

22. Program roles and responsibilities Role Major Responsibilities Initiative Champions Initiative Leadership • Motivate, encourage, and set overall direction of team • Hold team accountable for reaching targets & milestones, • Verify team analysis and recommendations • Acquire resources, remove roadblocks, and escalate issues when necessary • Drive implementation and monitor pace/progress 22

23. Program roles and responsibilities Role Major Responsibilities Project Team Leader Project Management • Provide creative thought leadership • Recommend answers to key issues to Champions • Drive detailed design and execution of project • Oversee all workstreams and team within each project • Update Carolina Counts of progress, issues, concerns 23

24. Illustrative Illustrative Project Team Leaders set the planfor the project teams Key Activities Deliverables • Develop Project Workplan • Lead analysis • Define financial and non-financial targets for each project • Identify and obtain needed resources to execute analysis • Question and validate team analysis with Champion and Carolina Counts • Communicate financial and non-financial targets, as well as progress, to Carolina Counts for tracking purposes 091228-UB2-Jan 8 Exec Orientation v4

25. Initiative Champions:Tactical do’s and don’ts Do Don’t

26. Carolina Counts focuses on accelerating progress and ensuring success Key Success Factor Reasoning 1 2 3 4 091228-UB2-Jan 8 Exec Orientation v4

27. Illustrative Carolina Counts will track progress against the targets 091228-UB2-Jan 8 Exec Orientation v4

28. Illustrative Major Tasks and Timelines 091228-UB2-Jan 8 Exec Orientation v4

29. Regular review meetings with all relevant stakeholders ensure success Agenda Frequency Participants Oversight Meetings Initiative Status Updates Project Working Sessions 091228-UB2-Jan 8 Exec Orientation v4

30. Program keys to success • We are embarking on a major reengineering effort - major change programs like this are hard. Expect and address resistance and organizational obstacles along the way. • Broad input from a cross-section of the campus (across function, professional backgrounds, etc.) and buy-in from leaders, project teams, and the campus at largeis absolutely critical. • We are accountable to the results. Even though we will be working on 10 separate initiatives; we share a common goal. The Program Office plays a vital role in coordinating and tracking, but each of us must hold each other accountable to results at every meeting. • Follow the 80/20 rule: 80% of the savings can likely happen with quick hits and a few bold efforts. Prioritize efforts and energy on capturing the 80% quickly vs. getting the remaining 20%. 091228-UB2-Jan 8 Exec Orientation v4

31. What is expected of you Carolina Counts Initiative Champions • Provide guidance and help project teamsthinkbeyond the boundaries of how the organization operates today • Help identify team leaders and projects teams – populate with the right mix of people • Empower the teams, giving them room to develop ideas and conduct analysis • Partner with Carolina Counts to keep project teams on pace to reach savings targets • Manage interdependencies andshare best practices across initiatives • Track and monitor initiative progress to milestones and savings targets • Help identify team leaders and projects teams – populate with the right mix of people • Partner with Champions and Project teams 31

32. Agenda • Our Mission and Objectives • Overview of the Program Phases • Organizing for Successful Change at UNC -- roles, responsibilities and accountability • Next Steps • Questions and Comments 091228-UB2-Jan 8 Exec Orientation v4

33. Next Steps Next Steps Responsibility 33

34. Agenda • Our Mission and Objectives • Overview of the Program Phases • Organizing for Successful Change at UNC -- roles, responsibilities and accountability • Next Steps • Questions and Comments 091228-UB2-Jan 8 Exec Orientation v4