Wait-and-See Approach to Cloud Adoption

It is interesting that higher education seems to be taking a wait and see attitude with cloud computing. Earlier posts suggest that the college and university environment would benefit from leading the transition to the next era of computing. Instead it appears higher education has selected a more conservative action: wait and see. The most interesting issue is we are in an era of economic downturn that has caused many states to take drastic actions to curtail costs, and higher education leaders are not taking advantage of proven solutions from industry leaders. I would suggest there are several reasons for this response:

1. CIOs are uncomfortable with a transition in technology that is controlled by the provider and the consumer, not the local IT organization. It is well documented that a university can offer state-of-the-art email to students at minimal cost to the institution. Universities like Arizona State, Notre Dame, Boise State, University of Maine, and Temple are successful, yet only 35% of universities are taking advantage of this offering. It is clear there are millions of dollars in savings being left unclaimed.
   
   
2. Universities are using security and compliance as the reason for not implementing cloud computing. This is a valid concern which has a number of documented solutions that are being ignored. The real problem is today’s universities are highly decentralized and the adoption of cloud services requires a comprehensive authentication infrastructure. It could be that the first hurdle to migrating to the cloud is the IT leader getting the university's security practices in order, having a disciplined security staff in place, and having best practices in place.
   
   
3. The Chief Academic Officer has not focused on the real savings that are available in using cloud resources. It is time for organizations providing leadership to the Presidents and Provosts to provide education and solutions to allow leaders to make the best choice for the institution. It is clear most CAOs have given total control of technology to the university IT leadership. Should funding issues continue, CAOs will be required to take charge if they want to realize the millions of dollars of savings available today and even more in the near future.

The next 24 months should be interesting to observe. Students are aware of what is available in today’s technology environment. Consumerization of IT is out of the box, and legacy practices will not dominate in the future. Attempts to control technology at universities has not been successful in higher education, and it will become even less so in the era of cloud computing.

What's Possible with Broadband Stimulus Funding

Just a week away from the first deadline for the responses on the broadband stimulus bill--what was the response from your university or college? I do not think the response to the opportunity is as important as why did you not respond. I do not mean to put you on the edge of your seat, Provost or President, but the culture of the university is becoming clear as the time draws to a close. I do not know about other states (that’s not quite true), but I am very aware of what happened at home. It appears that with almost two billion dollars at stake there are few if any responses ready to go, lots of reasons given, but the truth is we had a difficult time trying to do anything other than the norm for a large university.

A small recap...the broadband stimulus bill was aimed at getting broadband services to the unserved or underserved areas of each state. Bottom line, get broadband to those who do not have the service today. What I observed from most large universities was using the stimulus funds to improve and enhance the status quo, meaning improving our own university infrastructure or regional networks. I would have been excited to find universities reaching out to be change agents for areas of the states that do not enjoy high-speed access to the internet. I guess we should not have been surprised at the results. I look forward to the awards that result from the initial proposals. Will RUSS and NTIA make awards on our best efforts to move ourselves ahead or will the awards be given to organizations reaching out to the remote areas of each state?

I, like most others, hope the second round of grant proposals due next month will provide an opportunity for large research universities to form partnerships with groups that could use our assistance. I envision there are a number of opportunities in health care, saving energy, and education. I am beginning to hope the awards from the first round of grants and the rules for the second round of grants make it clear that all universities and colleges within a state must form partnerships that break down traditional political issues and demand creative solutions to problems that all states are experiencing. Only time and leadership will reveal if I get my wish.

The broadband stimulus grants will be debated for years to come, but they do provide our leaders with the opportunity to change. We will continue to work tirelessly to improve our own universities, or we will reach out and create an infrastructure that would allow our legislatures to improve the overall efficiency of higher education. Without a doubt in three years and 7.2 billion dollars, we will have a different landscape. The fruits of the investment are not as clear. During the same time period we will be experiencing transformational technologies across our campuses. No longer will we have e the ability to maintain an information technology leadership with large capital investments on our own campus. Cloud computing will level the difference between who can or cannot afford complex comprehensive systems. Colleges and universities will be able to enter the IT arena with little more than a good campus network and desktop systems. The need for systems staffs, large pools of application programmers, and data centers will diminish over time.

Now is the time to take advantage of the changing technology infrastructure requirements and team with others statewide to create world-class solutions to solve today’s problems. Just think, if your staff can grasp this vision soon enough to submit a grant, you might be able to get significant assistance along the way. Found it interesting there was an article in today’s New York Times by the founder of Siebel, Tom Siebel, asking the question about the importance of IT in the years ahead. This reminds me of the recent book by Nicholas Carr, The Big Switch.

Back to School in the New Technology Landscape

This fall will introduce a new era of computing to the Chief Academic Officer, one shaped by consumer choice rather than the mandated standards of the university. First, each university must determine its response to the rapid adoption of applications available for smartphones . The iPhone has reformed the landscape of customer expectation through what's possible with applications. The student once happy with out-of-the-box student systems has been exposed to the 65,000+ applications available in the App Store and wants a portfolio of choices that complement his/her lifestyle.

The next product to impact the university technology landscape is the Amazon Kindle, the first highly successful eBook reader. A number of universities are reviewing how the Kindle fits into their environment. Students are vocal about the increasing cost of tuition and textbooks. The extended recession with high unemployment is simply fuel to the fire. University administrators are questioning the traditional methods of acquiring textbooks and are looking at partnerships with publishers. The transition to e-textbooks will be much easier to accomplish technically than it will be able to accomplish politically with the faculty.

The next technology to watch this fall is the cloud offerings from Google and Microsoft. Until a month ago, Google was the outright leader in this area. Google had experienced great success with Google mail (gmail), Google Apps (word processing), Google talk (IM and Voice) and Android (smartphone OS). In July, Microsoft answered Google with Microsoft Office 2010. The new offering has two components: the first is the traditional upgrade to Microsoft Office that has happened every three years for the past 15 years. The more exciting announcement was the offering of Microsoft Office 2010 online for free. We have all been aware of Microsoft Live services available online for the past three years and have considered the product equal to Google Apps. The real difference maker with Microsoft Office 2010 is it will blend the traditional desktop with cloud computing transparently. Microsoft will have an advantage in building on the skill base of millions of students who have used its traditional office products throughout their existence. Microsoft’s vision of cloud computing will have several real advantages and was good enough to level the competitive playing field with Google.

So what do you and your CIO do for the fall with limited budgets—that is the real question. The most important thing you should expect out of your CIO is a two-year vision on where he/she is taking your university. The vision must be comprehensive and include the needs of the faculty and students. You must see a clear road map for commitment to Google or Microsoft. The plan must address the steps your university is planning to take with cloud computing and the partnerships that will make the transition possible. Students will demand that your university address mobility and will expect a response to applications that will make their university experience relevant. Don’t forget to include all the traditional IT expenses that seem to be growing rapidly.

The Changing IT Organization in Higher Education

Presidents and Provosts must continue to pay attention to the status of information technology on other campuses. Watching states like New York, California, North Carolina, Ohio, Michigan, and Florida struggle with funding is requiring academic leaders to reevaluate the usefulness of all the support organizations on campus and to revalidate earlier decisions on how to provide service functions campus-wide. I believe the only communities that will continue without significant change are teaching, library functions (information access), and research. I am certain all traditional administrative functions will be reviewed to ensure their contribution is enhancing the core mission of the University.

It is clear that the funding problems will not abate quickly and that state legislatures are looking for methods to minimize traditional cost. A large number of organizations are looking at outsourcing general services. At one time Information Technology was immune from consideration for outsourcing, but no longer. Two very large and different higher education organizations have successfully outsourced Information Technology: Arizona State University and the Kentucky Community and Technical Colleges. All Presidents and Provosts should become familiar with the two models of outsourcing used. Arizona State is a very large traditional university that has outsourced administrative applications and all campus email systems. Arizona State’s 62,000 students legitimize the upcoming “cloud computing” model works. Kentucky’s Community and Technical College system is located statewide with 67 campuses. KCTCS has over 90,000 students at the different campuses and have outsourced the entire IT function, including administrative systems, networking, telephones, course management systems, email, and video systems. Combine the examples with the efforts of state legislatures to control or lower the cost of higher education, and the day of accountability is here for the universities’ Information Technology organizations.

The pressure to change will only mount as the economic problems refuse to go away and legislatures refuse to change revenue producing practices (taxes) of the past. Information Technology in higher education is inefficient and has redundancy organization-wide. Further, all innovation that appears relevant to today’s faculty and students seems to be coming from technology savvy companies such as Google, Apple, and Microsoft. As you look at the large technology companies serving higher education, you see large investments being made in cloud computing: just look at the recent investments made by Oracle, IBM, PeopleSoft, Google, and Microsoft. If the providers are making 100 million dollar investments in changing the corporate methods of selling to user communities, should universities undertake a thorough review of practices in deploying technology on campus? I suspect Arizona State and Kentucky have initiated a trend IT cannot avoid, only delay.

Senior Academic Officers must look at the university organizational structure and determine what to do with the technology organization. The next few posts will provide several models that should be considered.

Summer Plans for the CAO

The end of another academic year is behind us, and we are all looking ahead, wondering what next fall will bring our universities. Will our student retention be acceptable, will the predictions on the incoming freshman class be on target, and how bad will the state budget get? The long, deep recession has ravaged our budgeting process, and next year does not look better. The Chief Academic Officer will be in the hot seat next year. The only bright spot on the horizon is the stimulus legislation.

Three actions the Chief Academic Officer must take this summer:

1. The university (especially the CIO) must provide leadership in two areas budget cutting and business process re-engineering. The two areas most universities have ignored to ensure political peace: the large maintenance contracts to support administrative and research computing and allowing multiple customer support centers when one would be better for faculty and students.
2. Form a stimulus action team and be prepared to submit multiple requests in the first round of funding planned for September 2009. The group needs to be aggressive and creative in seeking additional funding for the university. Three areas are going to fare better than others: electronic medical records, energy, and research facilities.
3. Student retention will become increasingly more important during the economic downturn. Universities must become student-friendly; this does not mean you need to give everyone a laptop and an iPhone. The university must review its processes and policies and ensure they make sense for the 21st century. We must make the faculty available to student questions, and we must recognize what worked for the student’s grandparents will not work with today’s student.

Following the above recommendations will not guarantee success, but it will improve your odds. Several recommendations should save you hundreds of thousands of dollars, and others will ensure your students will continue to return to graduate. Both will ensure you will be better prepared than many others when the budgets improve, and we can focus on academics.

Reforming Higher Education

Interesting that two newspapers (Lexington Herald-Leader and New York Times) today published articles on reforming higher education. Not revolutionary in today’s economic environment but still causes one to pause. One article focused on too many universities wanting to become research centers, and the second compared higher education to Detroit. Both articles came to the same conclusion; universities are spending too much money on areas not relevant to today’s needs.

Also it's important to note that Obama has continued to focus on using higher education to improve our chance to compete in the world economy and to encourage innovation across the sciences. The challenge to the Chief Academic Officer is to determine if it is time to reevaluate the mission and goals of the university or to just ignore the negative comments as idle chatter of the ignorant. The cost of a university degree and the dismal outlook for jobs will pressure students (and their parents) to decide if the financial commitment is worth four years of intense study. Interesting the first move by Obama was to recommend the government provide financial aid rather than continuing to subsidize the financial businesses. The action should encourage the CAO to evaluate university business practices to determine if there are other areas the Obama administration will encourage reform. It appears it is time to be bold if one is to be recognized as a leader. Simple, just follow the President’s example.

Changes in Business Processes

The economic meltdown has resulted in unprecedented budget cuts, and its swath is broad and deep. The university president has two choices: the first is to retrench by placing many projects on hold, freeze pay increases, and hope for the best. The second would be use the opportunity to change the status quo. Higher education is not known for its efficiency, and we have been doing “university” the same way we have been doing it for decades. During that time many universities have invested heavily in technology, including ERP systems. Many observers inside and from the community have noticed the lack of change.

The university president willing to be a change agent can move their institution forward despite the economic challenges. It is very clear the faculty will continue to introduce change incrementally, and that is OK. Faculty have been supportive of systems that improve teaching and research, and are critical of systems that are considered busy work. Investments in the academic infrastructure will continue to be important.

The change can be realized in administrative functions university-wide. The college president should use the economic climate to bring changes which were impossible earlier. A starting point would be business process re-engineering. A good place to begin would be human resources and accounting processes. The president must be willing to push the university into new methods of conducing university business to recognize the greatest savings. The business world has used ERP systems as a foundation for business process improvement for the past decade with significant returns. The goal would be to generate significant savings to reinvest in academic programs. A byproduct would be organizational agility.

The president that chooses to put everything on hold and wait out the downturn will find all areas of the university being adversely affected across the board budget cuts.

Other areas universities might review for change would be libraries merging student support organizations with IT—many libraries have shown leadership with the Information Commons concept. Another area of interest would be to rethink faculty support organizations (teaching learning centers, research support, library support) into a new organization. Bold rather than timid should define the roadmap of the next twenty-four months.

A number of individuals will say this cannot be done, higher education will never change. Interesting that Obama is choosing this time to change national policy on a number of issues. Who would have thought a year ago we would consider making student financial aid an entitlement or higher education would experience a huge boost in research funding? It is time to act.

Next Steps with Stimulus Funding

The next six months will be revealing for the Chief Academic Officer (President) of major public universities. States will be receiving the initial stimulus funding, and the legislatures and governors will be deciding if higher education will be a recipient or if other state agencies will receive a majority of the funding. It is clear that higher education was de-emphasized in the final legislation; the winners were students and the national science funding agencies.

The National Science Foundation received 3 billion dollars in additional funding and the National Institute of Health received 10 billion. There is another 3.5 billion for Energy and others. Expectations are the two funding organizations will disperse the funds quickly with current projects being expanded. Also expect a number of facilities upgrades to compliment the expanded research. With science receiving limited funding in recent years, it would be exciting to see the majority of the funding going to areas that were important in the presidential campaign: energy and healthcare.

State universities could use this opportunity to set themselves apart from the crowd for the next decade by deciding to optimize outputs through large collaborations with other universities. Further, it would be exciting to see the next boom in venture capital funding follow the Obama stimulus funding. A decade of economic growth could easily follow in renewable energy, healthcare, and informatics.

Many communities are waiting to see the direction higher education will decide to pursue. Will it be more of the same, or will universities step up with innovation that is noteworthy? Academic leaders must decide the next steps; the actions in the next year will set the direction for the next decade. State universities will be forced to reevaluate every aspect of the curriculum as budget cuts take their toll. The universities that can limit administrative and academic duplication statewide will be able to invest wisely in emerging academic programs across the sciences. It is time for the CAO to step up and lead.

Stimulus Funding Planning

It is time for Presidents (CAOs) to decide what steps to take: the following is a guideline for senior university leadership. This is presented in a sense of priority, but each university must interpret the legislation in light of their circumstances. The final legislation resulted in projects that require one-time funding, limiting federal and state exposure to long-term commitments. Initially, NSF, NIH, and Energy should be busy distributing the additional funds. Student financial aid appears a winner across the nation providing needed tuition for lean budgets. Funding that would stabilize operating budgets and funding to provide deferred maintenance were the losers.

Recommendation:

1. Focus on enrollment management with university staff. Each university should be in the middle of the enrollment cycle and staffed to handle this task. The CAO must decide how the stimulus funding will impact the incoming class—no easy task. It will be tempting to listen to the student’s request for admission and accept the increase in grants and aid to support higher education. The problem is stimulus funding that ensured state support for higher education was the largest single cut in the budget. End result will be pressure from students for admittance without offsetting funding for staff and faculty salaries.
   
   
2. Identify shovel projects that will “green” your campus. I expect every campus has a list of deferred maintenance projects; focus on projects that make your campus energy efficient. You will need projects you can begin immediately so you should have a task force underway to prioritize your spending plans. It is also time to visit the appropriate state offices to ensure your university receives a fair share--lobbying is not a dirty word. It appears the funding will be distributed in block grants to the state.
   
   
3. Research universities with medical centers should evaluate if they are prepared to request funding for electronic medical records. University hospitals and clinics that have only given passing interest will be at a disadvantage in becoming shovel-ready quickly; others who are committed will be ready to request funding, and statewide projects appear to be in the best position to receive funding.

The Obama Stimulus Plan: Thoughts for University Presidents/CAOs

Mr. President, you are two months away from making several very hard decisions. As you look at your state budget revenue and the demise of your endowment funds, you are about to make budget cuts you had hoped you would never have to implement. To confuse matters further, the House has passed the Obama stimulus plan, and the Senate will follow shortly. Once Obama signs the legislation, you will face two additional pressures.

First, you will have a pot of gold to further fund Pell Grants—a good problem that could allow you to increase your total tuition revenue without having to implement double-digit tuition increases. This itself will offset pressure from the state legislatures to freeze tuition rates, but the downside is the state legislature will be tempted to pass larger state budget cuts to universities. This will be a political football that could really help or make planning almost impossible. One bit of good news is that states must meet a minimum level of higher education spending in order to receive funding from the stimulus plan, assuming that language holds in the Senate.

Second, the Obama plan could fund a number of new research building projects and even more deferred maintenance projects. One-time funding for the projects will appear to be manna from heaven. The operation and maintenance budgets will not increase with the stimulus funding, leaving Presidents/CAOs with greater pressure on the operations budget that the state will likely ignore.

The stimulus funding will result in the appearance of growth and activity. The lack of state funding for operating budgets and the continued pressure on lower endowment funds will result in sleepless nights for many Presidents. The next two years will be the most difficult in the recent decade.

Funding Technology on Campus

An update on the state of funding at universities seems to be in order. Two months have passed since we discussed the importance of finances on translational technologies and uncertainty in the traditional higher education revenue resources has moved to gloom. State revenue continues to drop and the pressure from unemployment insurance payments are unprecedented, draining remaining state reserves. It is clear additional funding from the state will be nonexistent in all but a very few states. The stock market remains unstable without near term hope for a recovery that would help endowment funds. The only glimmer of hope is scholarship funding; the financial markets' deterioration has had minimal impact on student financial aid.

The remaining hope of many Presidents (CAOs) is the Obama stimulus plan. The initial draft is available and higher education projects were not omitted. The clear winner is funding for science and ensuring facilities are energy efficient. The Obama plan attempts to stabilize budget cuts to 2008 levels. The breath of fresh air was funding for science research and research facilities. Another real plus is funding for scholarships.

An obvious omission in the Obama stimulus plan is funding for campus technologies, computing, or networking. It is clear the Obama plan considers the state of technology at most universities acceptable without need of stimulus funding. This will require the CIO to focus on funding technology projects with traditional funding that is in short supply. The future remains uncertain for campus technology departments. The traditional methods of delivering applications is under considerable pressure. The next 24 months will be very interesting as cloud vendors offer campus solutions to technology requirements, and the CIO will have to decide their University’s strategy for the future.