Budget Reductions in Procurement, Logistics and Business Services

From: Peggy Norgren, Associate VP for Finance
Date: Fri, 28 Oct 2005

Our current budget challenges have prompted Procurement, Logistics and Business Services to examine areas where we can improve effectiveness and focus resources on core activities to support the University’s business services needs. These decisions have led to reductions in two of our auxiliary operations: Printing Services and M-Stores.

Within Printing Services, we will eliminate the six-color press and therefore will no longer accept orders to provide large-format, multi-color printing, effective immediately. This change is necessitated by declining campus budgets for printing, increased digitization, and aggressive competition in the commercial market for printing. Printing Services will continue to provide full service options for small-format prepress, offset printing and finishing. University units will order their stationery products from Printing Services online as they are accustomed to doing. Our staff will work with customers whose printing needs cannot be satisfied by Printing Services to identify outside vendors who can provide the needed services.

M-Stores will eliminate its custom meat-cutting service and will make additional staff reductions in other parts of the organization in order to increase efficiency. Quite simply, the demand for custom cuts of meat has not provided the volume needed to cover our costs in this area. We have already worked with our campus clients on this change and do not anticipate any concerns arising from the decision to eliminate this service.

In total, these service reductions will result in the elimination of 15 staff positions in Printing Services and 10 positions in M-Stores. Although a small number of these are open positions, the majority are being accomplished through Reductions in Force. These are difficult decisions. In an effort to cushion the impact on employees and due to the very specialized nature of printing and meat cutting, we are providing some services in addition to the normal assistance with RIF placement. We have hired an outside agency specializing in career counseling and job placement to assist all affected staff and are providing an allowance for career training opportunities over the next year.

During the course of the next year, Procurement, Logistics and Business Services will continue to review its operations. We are nearing completion on an evaluation that has been underway for more than two years regarding how we purchase, store and distribute food to our customers. In addition, we plan to retain a consultant to review all distribution and warehouse activities on campus and in the Health System to determine opportunities for improved efficiencies and service. These evaluations will help to shape and define our future direction.

As always, we will continue to focus on our commitment to provide premiere business services to fulfill customer needs and to support the University in reaching its goals of excellence in education, research and community service. Please contact me if you have any questions about our services. In addition, Pat Squires in Printing Services (psquires@umich.edu or 764-6230) and Christopher Johnson in M-Stores (johncson@umich.edu or 615-9505) would be happy to talk with you about their respective areas.