University of California, Irvine

Kuali Financial System (KFS)

Organizational Structure Proposal

July 5, 2012, 2012

Org Hierarchy Query 2-20-13.xlsx

The Planning and Budget (P&B) team is submitting the attached preliminary organizational structure proposal for the University of California, Irvine (UCI).

This proposal was developed based on consultation with campus units, a thorough review of the existing organizational structure, and in some instances, based on analytical reviews of historical expenditure patterns. However, we want to emphasize that our approach was also based on the assumptions that the new financial system contains numerous attributes that will facilitate reporting and that the new improved Cognos reporting tool will enable users to complete advanced data analysis. Yet without full knowledge of how workflow will impact departmental needs, it is possible that additional modifications may be required. Finally, in this document, we’ve also identified some of the issues with the existing structure and provided a comparative view of the existing and proposed organizational structures for UCI.

As the university prepares for the implementation of the new Kuali Financial System (KFS), we recognize that the organizational structure is a principal component. As such, it is imperative that it is constructed accordingly. However, when we reviewed the existing hierarchy, we realized that over time, the current structure has evolved into an inconsistent framework of more than 900 attributes (Organizations, Divisions, Sub-Divisions, and Departments). Moreover, the lack of flexibility with the current financial system, combined with the many reorganizations to meet operational demands, have created numerous hierarchical gaps that obscure financial reporting.

In some instances we identified that departments under the existing organizational structure are exclusively used as grouping tools rather than to illustrate an actual functional unit. Consequently, many of the recommendations evolved as a result of this concept.

Significant Changes

Identified specific Schools and Divisions that frame the highest hierarchical level. These units are typically viewed by the EVC when strategic decisions are executed.

Eliminated departments that are currently being used as a grouping mechanism. Our recommendation is that the units will be able to utilize the KFS attributes to accomplish the desired grouping.
- Eliminated most of the division and sub-division tiers, particularly in those areas where the tiers only replicated the actual department name.

Overall, we’ve eliminated 439 elements; however, we’ve also added new organizations (at various levels in KFS) in areas where we felt a need to expand in order to improve the unit’s representation. Yet, we concluded that 180 of the 439 eliminated elements are currently inactive. Our current model includes a total of 53 newly identified organizations.

Eliminated the prefixes used on many of the department names. These prefixes usually identified the School or Division name but were not consistent. Also, some of the department names were modified based on constituents’ feedback and in order to make them more meaningful.

Overarching Principles

As we designed the new organizational structure, we considered the following principles:

Definitive Purpose - The primary purpose of a hierarchy is to illustrate the unit’s functional mission rather than to group financial data.

Efficiency – The proposed hierarchy should effectively provide users with a global understanding about an entity’s framework and major units.

Consistency – In order to develop some consistency across the campus, in some instances we identified similar units and made an effort to construct all of those units’ structures using a similar approach. For example, at a minimum, all the schools have individual ORGS for the Dean’s Office, for each of the academic units, and for the major existing centers that were easily identified. Additionally, we have defined the various hierarchical levels as depicted below.

U level - Represents the university as a whole. There can only be one U ORG level.
C level - For each chart, C will be the highest org level. Each chart will have only one C level.
S level - The S level ORG should be centrally defined based on reporting needs and to indicate major colleges and/or administrative units.
D level - An ORG assigned at the D level can only be established under an S level ORG. In order to establish a D type ORG, there should be a concise academic field or administrative function that is consistent with the University mission. This unit is also managed by a senior leader with responsibility over that unit's resources.
V level - An ORG assigned a V level can only be established under a D level ORG. In order to establish a D type ORG, there should be a concise academic field or administrative function that is consistent with the University mission. This unit is also managed by a senior leader with responsibility over that unit's resources.
L level – An ORG assigned an L level can only be established under a V level ORG. In order to establish a D type ORG, there should be a concise academic field or administrative function that is consistent with the University mission. This unit is also managed by a senior leader with responsibility over that unit's resources.

Continuity - In order to maintain a meaningful structure, avoid hierarchical gaps and avoid omitting financial data that can potentially distort financial trends, the validation rules depicted below should be considered when determining the appropriate set-up of all new ORGs.
- Accounts must report directly to the lowest ORG level
- If D level ORGs (or lower) are established, then any accounts directly reporting to an S level ORG must be remapped to the lowest level ORGs

Development Scope and Approach

During the evaluation process, we executed the following steps:

Assessed the use of specific KFS attributes including the Account, Sub-Account, Account Manager, Project Code and Sub-Fund Group and Higher Ed Function Code. Understanding the functionality of each of these elements became critical when determining whether or not to eliminate divisions, sub-divisions, and departments that are currently established primarily for grouping and reporting purposes. Consequently, we moved forward with the assumption that the Sub-account and Project Code fields would be used based on the department’s discretion.

Prior to initiating our discussions with select units, we concluded that while we were proposing to eliminate many existing levels, the units would still be able to use the KFS attributes noted above to accomplish their reporting needs. In fact, we specifically made this recommendation to department managers.

As an example, we identified units that were proposing to establish a separate ORG solely for the purpose of segregating Graduate and/or Undergraduate Financial Aid. In these instances, we advised units that a single account, in conjunction with the Higher Ed Function Code, would help them distinguish all Financial Aid activity.

Conducted independent research about KFS functionality and how it was used by other higher educational institutions. We also continuously consulted with UCI’s KFS team.
Developed detailed structures for each of the schools/divisions and presented a side by side comparison of existing and proposed hierarchies.
Consulted with key campus representatives from 17 schools and divisions. The information gathered enabled us to formulate a structure that consists of 29 Schools and Divisions, excluding the UCIMC.
Performed additional analytical and materiality validations to evaluate selected units/departments. Specifically, this was completed for units that were unfamiliar to us in order to better understand the structure and provide coherent recommendations. This process consisted of a thorough assessment of the departments’ existing structure, including the number of departments, accounts and expenditure patterns.
Modified the initial hierarchical drafts based on the feedback provided by campus staff. We also made consistent modifications to most of the hierarchy structures based on recurring issues identified across similar units.
Constructed a cross-walk table that will facilitate the data conversion. In this table, we listed all the existing hierarchy components, indicated the recommended KFS status and level for each and provided specific account mapping information as required.

Org Hierarchy Query.xlsx

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