AITB Documents

This report responds to your April 9^th letter requesting the Board to review and make recommendations on the Information Systems Transitional Infrastructure Plan (ISTIP) submitted by Vice Chancellor Peter Blackman.

The report is organized into three sections: 1) Staff analysis of the ISTIP proposal, 2) Board discussion of the proposal, and 3) AITB findings and recommendations.

The Board spent the better part of three meetings reviewing and discussing the programs and the associated budget outlined in the proposal.

Staff analysis of the ISTIP proposal (1999-2003)

On April 9, 1999 Executive Vice Chancellor Hume asked the AITB to review and advise him by May 26^th on a IT planning and budget document submitted by Vice Chancellor Peter Blackman. The document, "Information Systems Transitional Infrastructure Plan (ISTIP): 1999-2003," proposes multiple year funding for three major programs: 1) modification of the current financial and purchasing systems; 2) Student Systems, and 3) the Query Database (QDB) - a data warehouse which enables distributed access to information across financial, student and other administrative programs. Additional programs are also proposed in ISTIP.

The ISTIP is written and assembled to suggest a lean, highly integrated, administrative planning and budget environment. The foundation for the program and budget details of the ISTIP consists of three overarching assertions:

1. That the plan appropriately responds to a major paradigm shift in how the business functions at UCLA are conducted and the support IT must give to those functions.
2. That the resources available to central IT units to support this paradigm shift are presently not sufficient to sustain current programs, and totally inadequate to meet known future growth.
3. That there is accelerating demand from campus units for the decentralization of administrative applications and data – and that this will be best accomplished by modernizing mainframe technology to client-server and web-based applications.

The ISTIP is represented as a transitional strategy – in that it allows for existing applications to be modified and updated over a four-year period. This approach is based on internal data and analyses and on consulting firm reports. For example, based upon a comparison study conducted by the consulting firm KPMG, the plan defers until 2007 the acquisition of a new financial system. KPMG identified several universities which have adopted the "new-acquisition" approach and are spending 50 million-plus while incurring costly overruns. The study implies that these applications are still immature and UCLA would be better served by following a more conservative approach - updating and modernizing existing applications – and reassessing the option of purchasing a new system starting in the year 2004.

The ISTIP proposes a multi-year (98/99- 2202-03) funding approach of approximately 37 million. Of the 37 million, 33.3 million is for the three major systems mentioned above:

• 14.5 million is projected for Business and Finance’s financial, purchasing, and related systems;
• 6.3 million for student systems¹; and
• 12.5 million for the QDB - developed and managed by AIS. Of the 12.5 million, 2.9 million is to cover an existing QDB authorized deficit².

The remaining 3.7 million is projected for several more-or-less free standing projects: the Year 2000 program ($2.2M); the establishment of an IT Security office ($0.7M), an Authentication/Authorization project ($0.5M); and funds to cover a deficit previously incurred by AIS for - Excalibur - a document imaging application, purchased and implemented for the Chancellor’s Communication System ($0.6M).

VC Blackman’s proposal suggests the following revenue sources, totaling 47 million, to cover the cost of the programs outlined in the ISTIP:

• 16 million is identified as a booked commitment³ for the deferred new financial system,
• 10 million to come from the Information Technology Infrastructure fund⁴
• 15 million to come from connectivity funds⁵
• 6 million to come from STIP gains from the R-Net⁶

The plan also proposes a review of AIS to determine the cost of its programs and services to departments. This could lead to some type of recharge strategy⁷.

AITB discussion of ISTIP

Associate Vice Chancellor Solomon, Associate Vice Chancellor Moribito and Assistant Vice Chancellor Abeles met with the Board to provide background and rationale about ISTIP and to explain the programs. Assistant Vice Chancellor Glyn Davies provided clarification on accounting terms and practices detailed in the report.

In addition Davies provided the Board with important financial context. Davies noted that the pending IT proposals (including ISTIP) - requested to be funded through the Chancellor’s unallocated funds – substantially exceed anticipated funds available.

The AITB decided that in advising the Executive Vice Chancellor a detailed commentary and analysis of the plan on a program by program, line-item budget basis would not be the appropriate approach. It concluded that it does not have the time or information, and probably not the credibility, to do this persuasively. Rather, the Board decided to focus on broader questions such as:

1. Does the large dollar size (and the fact that requests far exceed uncommitted funds available) and multi-year commitments set UCLA on a course that precludes it from taking full advantage of the leadership that the campus hopes to acquire in its new Associate Vice Chancellor for Information Technology? Perhaps there would be wisdom in waiting for the new leadership to help guide strategic planning in this important area of activity.

2. Does the plan achieve an appropriate balance between the academic and administrative demands on the IT dollars available to the campus?

Although the Board decided that it would be unwise to make specific program by program findings and recommendations, many observations of this nature were made at our meetings. We include several of them to convey to you the questions in the minds of Board members, which you can evaluate.

1. Upgrades to applications and databases are limited in value if the connectivity infrastructure is not in place to access and make use of the benefits. Members expressed concern at the slowness at which the first phase of connectivity is occurring. The Board is also concerned about using future connectivity funds as "bridging" funds for application development.

3. The Board wondered about the metric that can be used to comparatively assess the financial and student system initiatives which make up approximately 56% of the requested funds. Student Systems is at the core of the University’s teaching mission and should be a priority. The risk of not attending to Student Systems could create greater opportunity costs in the future as UCLA competes for incoming students. At the same time the financial system provides the infrastructure necessary for the University to operate - and certain components are required to meet new government accounting regulations.
4. One or more individual Board members questioned:
   • the advisability of continuing the R-Net program without deeper examination of its academic merit. The factors that contributed to the failure of the pilot, and whether or not those factors have since been mitigated are not addressed in the ISTIP.
   • the advisability of AIS incurring authorized deficits for the acquisition of programs and services that primarily benefit a single department i.e. the Excalibur imaging project for the Chancellor's Communication System.
   • the advisability of starting specific new initiatives prior to new IT leadership, i.e. Bruincard startup, the IT Security office and potentially the authentication/authorization project.
   • the potential opportunity cost to funding of new academic IT initiatives given that the ISTIP request considerably outpaces discretionary revenue? The 37 million dollars requested will essentially deplete the available unallocated resources.
   • whether it might not be better to provide the multi-year ISTIP proposals funding for one year while other revenue generating options are investigated - including the alternative of a recharge strategy that equitably relates cost to usage. There exists considerable support on the Board for the administration to look into instituting a "toll" system to encourage efficiencies and motivate responsible usage.
   • whether the ISTIP proposal is transparent about the true costs of accomplishing the projected program improvements. From the perspective of several AITB members, it seems that the main effect of ISTIP is that UCLA will continue to spend "good" money to patch and modernize "antiquated" systems that ultimately provide inferior results and constitute a poor investment toward meeting our future needs.

These concerns seemed especially attenuated in the ISTIP approach to upgrading the financial system. ISTIP draws support from the KPMG report but largely without explanation. The justification provided by Business and Finance does not address the direct benefits to the campus for making a substantial new investment in old technology. The analysis and justification left many unanswered questions in the minds of AITB members.

AITB Findings and Recommendations

The traditional divisions between administrative and academic IT have become indistinct. However, the budget process still functions so that the ISTIP proposal is presented as a tight program to enhance mainly traditional administrative functions while most budget requests that address academic concerns directly are embedded in the proposals from the provosts, deans and other academic administrators.

Based on discussion at three meetings and against the background outlined above the Board makes the following findings and recommendations.

1. The interrelationship between administrative and academic IT within the ISTIP is apparent when considering potential trade-offs in funding the proposals for improvement in the financial systems, on the one hand, and those systems which support the core academic mission of the University – Student Systems and the Connectivity Project.
   
   1. The ISTIP proposes an approach that would fix, upgrade and/or improve existing financial applications over the next 3 to 4 years until the time is right for the acquisition of a new system. Although the Board does not have sufficient background – as indicated above - to know whether this is the correct strategy, the KPMG report which suggested the incremental approach adopted by ISTIP (modernizing rather than replacing) also cautioned that the approach is not without risk, stating:

   "that the result may be enhancements that are less than optimal for user needs resulting in a significantly reduced functional return on investment" and "the instability of the existing systems may increase as more functionality is added...the result may be that UCLA cannot complete the enhancements as planned."

   2. With regard to Student Systems – although the Board as a whole has incomplete direct knowledge of specific program by program upgrade and modernization requirements – there is no doubt whatsoever that the proposal responds to a fundamentally important customer base – undergraduate education - and the college’s plan for Curricular Communication. This proposal, which will develop and improve access to information so that students can make more educated decisions about the curriculum and their progress towards degree, merits your energetic support and corresponding funding commitments.
      
      We also point out that a significant component of the Student Systems proposal is to "rationalize" the databases by upgrading them to modern relational standards, ensure data integrity, reliability of results, and improve access. This advance in student data systems deserves strong support now, and this support will not have been wasted when a new system is selected.
      
   3. The Board has consistently urged that the Connectivity Project remain a high priority for the campus and we reiterate that position here. We believe that to some significant degree connectivity has been de-emphasized through the 50/50 department/central funding model, delayed completion, and - as ISTIP proposes - the diversion of future connectivity funds to the programs outlined in this report.

   The Board recommends that connectivity remain the highest campus IT priority, demonstrated through sufficient funding to complete the project in a timely fashion. We would specifically urge you to assist those departments who are ready to connect but cannot meet the 50% shared funding requirement.

   Because connectivity requires on-going maintenance and renewal, the Board does not support the diversion of future connectivity funds to application development unless provision is also made for connectivity maintenance and renewal.

2. We urge that you not make multi-year funding decisions that affect infrastructure and long-term direction if it precludes the involvement of the new IT leadership presently being recruited.

3. The ISTIP plan does not lend itself easily to the uncoupling of what appear to be freestanding program recommendations - such as R-Net, Bruin Card, IT Security Office, and to make direct comparison with the academic IT needs submitted by Deans. Given the high request to revenue ratio in ISTIP, we would advise you to ask for some prioritization of these programs. If you think it helpful, the AITB would be happy to review specific programs and make appropriate recommendations

Footnotes:

1. Funds are requested to improve and stabilize Student Systems while a formal strategic planning effort is engaged over the next four years to support the College’s Curricular Communication program. The stabilization plan calls for the limited enhancement of degree audit, enhanced access to data and business processes, modernization of URSA, and rationalization of databases for student records, undergraduate admissions, and their shared components. The database rationalization process accounts for approximately 60% of the 6.3 million and can be used for a new Student System regardless of which system is selected at the end of the proposed strategic planning effort.
2. Documented as a "structural deficit" AIS was authorized to develop the QDB program and run a deficit without funds identified for maintaining the program once implemented.
3. A booked commitment essentially means that the money was identified in past years for a new financial system and set aside for its eventual purchase.
4. This revenue source was originally setup by EVC Andrea Rich for broadly defined information technology infrastructure purposes.
5. Connectivity funds that will accrue after the completion of the first phase of the UCLA Connected project in 2002. Future connectivity projects or upgrades would be put on hold for three years while these funds are used to "bridge" these other administrative activities.
6. STIP gains should be viewed primarily as potential "productivity gains" rather than a revenue commitment.
7. In previous years when departments accessed AIS’ applications through controlled "hard-wired" lines (from terminal to mainframe) there was a recharge strategy in place that provided an accounting recharge metric related to actual use. Now that existing and newer client-server based applications are accessed over the campus backbone it is much harder to relate expenses to departmental use. With the elimination of controlled and direct connection to mainframe applications and data, this recharge structure was abandoned in the early 90’s.