April 5, 2011
To the Members of the MIT community:
The Institute-wide Planning Task Force was announced in December 2008 by the provost, chancellor, and executive vice president and treasurer. The group was charged with identifying and assessing opportunities to reduce costs at the Institute in Fiscal Year 2011 and beyond. In December 2009, the Task Force issued its final report, and in March 2010, the three senior officers who'd created the Task Force wrote to the MIT community to describe how they planned to act on and advance the ideas presented in the report. One year later, we offer a final update on how the ideas of the Task Force took life.
That March 2010 letter included the news that in order to maintain a balanced General Institute Budget, expenses in FY2011 would need to be reduced by $61 million. The letter further estimated that of that amount, $12 million in budget savings or revenues would come from Task Force ideas. It is our pleasure to announce here that we are on track to achieve our overall budget reduction goal for FY11—and that Task Force ideas will in fact have contributed to these reductions as budgeted.
We are equally happy to report that the savings achieved are not merely good unto themselves: they are early indicators of ways that the collaborative work of the Task Force will endure long into MIT's future. The Task Force's more than 200 members represented students, faculty and staff — and asked profound questions about the operation of MIT. How, for example, might digital technologies be used to take the paper out of paperwork and streamline processes? How can our physical space better use energy—and how can the space as a whole be better used?
1. Ideas into Action
These kinds of questions led to the over 200 total ideas generated by the Task Force's working groups. We have compiled a spreadsheet that details what the ideas were and whether or not they were acted upon. Each idea was assessed by a relevant operating unit, given a specific response, and assigned a status In all, 77% of the ideas were acted on, and many of these already have been implemented. Accompanying the spreadsheet is a pie chart (also shown below) illustrating the distribution of ideas according to their status.
We would like to point out four ideas notable for their deep and immediate impact:
Idea: Digital MIT
Central administrative units and members of the MIT community have been collaborating for the past year to transform the Institute's mostly paper-based processes to more modern and effective services. Advancing the concept of Digital MIT articulated by the Task Force, the Institute has undertaken numerous projects over the past year. These advances include:
- Adoption of ePaystubs in place of paper paystubs and electronic W-2 tax forms
- Online subject evaluations
- Development of an electronic request for payment (eRFP) service
- Paperless Admissions reading and decisions process
- Modernization of the Institute travel program
- Online grading (currently in pilot); submittal of final grades electronically
These efforts to streamline business processes are making it easier for faculty, students and staff to perform their work while reducing printing and distribution of large volumes of paper.
Idea: Energy savings by Facilities
MIT's Department of Facilities acted on Task Force–generated ideas about saving energy on campus. In 2010, the Department helped MIT join with the NSTAR Electric and Gas Company to create a new program to reduce our energy consumption by 15% over the next three years. Toward that end, Facilities is implementing projects across the campus to reduce energy consumption. These include:
- New or updated lighting systems in 13 buildings
- New or refurbished lighting controls in 14 buildings
- Reconditioned steam traps in approximately 55 buildings
- The addition of adjustable speed drives to fans in several buildings
- The completion of data-based commissioning (i.e., hour-by-hour monitoring of energy efficiency) in the MIT Sloan School of Management and the David H. Koch Institute for Integrative Cancer Research. Data-based commissioning has been completed in seven more buildings and is being installed in three more.
- Facilities has partnered with IceTec to optimize the assignment of chillers, boilers and generators to meet MIT utilities needs in a manner that maximizes efficiency and minimizes cost. The shared savings model is expected to generate net expense reductions over expected targets.
As a result of MIT's program and the groundbreaking agreement with NSTAR, MIT has been asked to participate in three new initiatives: the ISCN/GULF Sustainable Campus Charter, the Department of Energy Global Superior Energy Performance Initiative (GSEP) and the Department of Energy/Lawrence Berkeley Lab Commercial Buildings Program Grant. The latter two are a direct result of MIT's energy reduction program and are considered a new model for the large-scale building sector.
Idea: Procurement improvement
Cross-functional teams are continuing to pursue initiatives recommended by the Task Force to realize savings opportunities in the buy/pay arena, negotiating improved supplier terms and advancing the use of electronic payments. The Institute has realized increased rebates from the MIT Procurement and Travel credit cards and has secured overall cost reductions from major suppliers of products and services. We have achieved savings of $3 million annually and are expecting recurring savings of $4.5 million annually.
Idea: Improved Summer Housing Utilization
The Task Force recommendation to consolidate summer MIT students into fewer dormitories was both a financial and a maintenance success. Principally, this idea reduced expenses $400,000 by reducing the staff time needed to support multiple buildings throughout the summer period. Savings were also generated by approaching maintenance and renovations systematically, thereby reducing contractor set-up time and logistical expense. The process of closing certain buildings for renovations and consolidating MIT students into others considered the input from student residents. Students suggested ways to mitigate the disruption to residents by providing moving boxes and making arrangements for summer-long storage at a local storage company.
Consolidating summer MIT students also opens up opportunities for MIT to generate additional revenue by developing predictable summer conference housing stock. Summer conferences not only bring additional revenue but also allow many more people to interact with the MIT community.
As MIT is entering only its second summer of consolidating summer residents, the full effects of this recommendation will be seen well into the future. With better maintained buildings and a robust summer conference business, MIT stands to reduce maintenance expenses while generating new revenue.
2. Opportunities that Received Further Study
The March 2010 letter from the senior officers who created the Task Force announced the formation of groups tasked with taking a special look at certain ideas generated by the Task Force. Those ideas center around:
- Employee benefits
- Educational use of the campus
- Printing and digital archiving
- Measuring and understanding the cost of undergraduate and graduate education
- Measuring and understanding the way space is used at MIT
Click here to read descriptions of what each group was asked to do and where it is in the process.
The Task Force was designed to help MIT achieve its budget-cutting needs without sacrificing the Institute's most important values. It has achieved that objective—and in the process, it has offered two additional lasting benefits.
First, many of the ideas we have implemented amount to permanent improvements: the creation of ePaystubs, for instance, will offer savings and convenience long into the future. Second, the process by which ideas were generated and considered might serve as a model for how MIT can come together when it needs to solve deep and difficult problems. The Task Force did not just depend on the MIT Community: it was the MIT community. Though the group's work is now done, it is our hope that the Task Force will live on not only through its implemented ideas, but also through its proven method of inclusion and transparency.
Israel Ruiz, Vice President for Finance
Martin Schmidt, Professor of Electrical Engineering and Associate Provost