What Duke is Doing
While Duke University is financially stable, we have not been immune from the impact of the global economic recession. The University is committed to supporting its faculty, staff and students and protecting its academic programs. The tight financial times have forced the University to identify various approaches to reducing costs while continuing to meet our mission. These approaches include:
Below are links to memos and articles that explain some of the steps Duke has taken. Click here to see all stories in chronological order.
In December 2008, President Richard Brodhead sent a letter to the Duke community asking that we consider the growing economic challenge as a time of challenge, not retreat. Preparing for the possibility of a sustained period of tight budgets, Brodhead said the university's goals are to bring the most resources possible to its strategic priorities and to protect its core commitments: excellence of faculty, the student experience. Steps taken to make this a reality include:
- Strategic Planning: Provost Peter Lange asked the deans of all 10 schools at Duke to take a fresh look at the strategic plan, Making a Difference, and the plans for their own schools, and report back to him on how they can best pursue their objectives amid tighter constraints. Each dean was asked to focus especially on how to enhance faculty excellence, promote strong graduate and professional programs and enrich the student experience while advancing critical university strategic themes: interdisciplinary study, knowledge in the service of society and internationalization.
- Faculty recruitment: Duke continues to support and recruit excellent faculty. Duke planned to recruit for more than 60 new faculty in FY10.
- Financial Aid: Duke remains committed to admitting the best undergraduates, regardless of their ability to pay. The budget for FY10 includes $114 million to support Duke's undergraduate financial aid program. Under the new financial aid program, launched in 2008, families making less than $40,000 a year are not expected to pay tuition or contribute to the costs of room and board and other expenses. Students from families making up to $60,000 do not have to take out student loans. Students from families making $100,000 have reduced loans.
Since more than half of Duke's operating budget is spent on personnel costs, reducing these costs is important. In the past year, Duke has taken the following steps to rein in personnel costs:
- Partial salary freeze: In 2009, university employees making more than $50,000 per year received no salary increase in FY 2010 (July 2009 - June 2010). Employees making $50,000 and below received a one-time, $1,000 payment. In 2010, university employees making $80,000 or less will be eligible for the one-time, $1,000 payment; those making more than $80,000 will not receive an increase.
- Vacancy management: Duke has curtailed external hiring, eliminated vacant positions, and made internal reassignments as a way to reduce personnel costs. Since March 2009, departments recruiting to fill positions must have those positions approved at senior levels before Duke can begin the recruitment process. As of the end of 2009, Duke had reduced its workforce by more than 400 full-time-equivalent positions.
- Retirement incentives: Duke offered two retirement incentives in 2009. The university offered the first retirement incentive package, for bi-weekly employees, to 895 employees, and 395 employees accepted. The second retirement incentive package was offered to 198 monthly-paid employees, and 90 individuals accepted the offer .
- Managing overtime: Duke has carefully managed the use of overtime. As of December 2009, savings amounted to the equivalent of shedding more than 40 full-time positions.
Across the university, faculty and staff continue adjusting to a challenging financial reality. Some of the efforts include:
- DART: The university has established a team of faculty and staff to identify opportunities to redesign major processes and services that span the institution. This group, called the Duke Administrative Reform Team, is chaired by Provost Peter Lange and Executive Vice President Tallman Trask III. The team reviews all suggestions submitted through the Enduring a Troubled Economy website.
- Computer purchasing: Duke introduced a program designed to leverage volume purchasing for steeper discounts on computer purchases. The program discounts and expected longer life of computers will save an estimated $2 million annually.
- Saving on contractors and consultants: Departments wanting to hire contractors and consultants now must provide justification and request approval from their schools and units, as well as by the Provost, Executive Vice President or Chancellor for Health Affairs, depending on the unit.
- Departmental expenses: The university has asked all units to reduce expenses for travel, entertainment, overtime, equipment purchases and other goods and services. Some units, such as the Student Health Pharmacy, have closed due to rising operational costs.
- Construction: Duke will not break ground on any new buildings until external funds are identified and secured. Planning for certain developing projects, including New Campus, will continue, but the start of construction will be deferred. (Duke University Health System, which is continuing construction projects, operates on a different budget than Duke University).
- Energy Consumption: A new Building Temperature policy has been implemented for buildings on the central control system. Duke is also planning a "Going Green" campaign to help faculty, staff and students understand how to reduce their carbon footprint.
- Grounds Maintenance: Less frequently mowed grass, less weeding and slightly longer waits for maintenance requests in non-critical areas are among the strategies adopted by the Facilities Management Department to manage with fewer resources. Critical areas like the NCAA athletic fields are maintained according to schedule due to collegiate regulations.
- Paperless payroll: Duke moved to online pay statements in July 2009 to save printing and distribution costs and improve efficiency. Now all employees who have chosen to have their paycheck automatically deposited in their bank account can see their monthly paystubs online at Duke@Work.
- Telephone savings: Duke's Office of Information Technology (OIT) is converting most phone services on campus and in the health system to Voice over Internet Protocol. VoIP sends telephone calls over the existing computer network, which eliminates the need for dedicated phone lines and switching equipment and lower the cost per line. At the end of the two-year conversion process, the university will save an estimated $2.7 million per year compared to current phone costs.
- Trinity College: In November 2008, Trinity College of Arts & Sciences Dean George McLendon said he expected the school's central administration to carry the burden of meeting a three percent deficit for each of the next two to three years.
- SON slowing, but maintaining growth: School of Nursing Dean Catherine Gilliss told school faculty and staff that the school will continue its course of growth and expansion, though perhaps at a slower pace. The school is finding savings through slowing down on spending, reducing the amount of money spent for nonessentials, slowing down plans for minor reconfigurations of school facilities and cutting back on unnecessary travel. The school, which has seen significant growth in both its academic programs and research, will benefit from increased interest in and demand for highly trained nurses. Enrollment expansions are anticipated.
- School of Law: The School of Law implemented cost savings measures, including sending the school's holiday card by e-mail rather than U.S. Postal Service to save on postage, and printing DukeLaw Magazine on lighter-weight paper that costs less.
- Fuqua School of Business: In a move to help the school financially, each of Fuqua's two-dozen chaired professors agreed to teach one extra course this academic year. That allowed the school to cover the teaching needs of its new master's in management science program without having to hire extra faculty members.