Weekend warriors and home improvement aficionados know the key to a successful paint job is the prep work. Be dogged in laying down the proper foundation, the feeling goes, and then reap the rewards of an eye-catching final product.
The financial business practices task force of the university's Business Process Improvement Committee is also a firm believer in prep work. When this 20-member group convened last fall to assess their area of concern, they noticed some inherent problems associated with the financial processes of research administration.
Difficulties included inconsistencies and inaccuracies in grant account information, the need for duplicate data entry, a lag time in account setup and a frustration on the part of principal investigators when accessing account information in order to effectively manage their projects. The committee also deemed that when the time came for investigators to spend their final grant money and administrative staff to close out the accounts--in effect, applying the final coats of paint--unnecessary extra steps were needed, and the process wasn't as smooth and efficient as it could be.
The major culprit of these inefficiencies was recognized as the initial budget and account setup, according to task force chair Judy Reitz, executive vice president and chief operating officer, The Johns Hopkins Hospital, and vice president for operations integration, Johns Hopkins Health System. Reitz said that in an effort to streamline the research administration system and make it more user friendly for both staff and faculty, her task force has already identified two major priorities:
to develop a new system to set up accounts correctly, efficiently and in a timely manner; and
to provide principal investigators with direct Web-based, user-friendly access to financial account information from anyplace in the world.
Reitz said that while these two priorities are being looked at separately, they are integrally related and aimed at the same goal.
"We think if you take the time and set up the account properly in the beginning, you could avoid the rework that happens now. There is really no advantage in giving principal investigators access to wrong information. That is why these two priorities are very much connected," Reitz said. "Basically, we want to introduce a more rigorous system of establishing accounts once we receive the grant award--to develop the necessary control points and accountability measures so that we know the account is set up in a timely way. It's technical, behind-the-scenes work, which is now viewed as cumbersome."
The financial business practices work group is one of five task forces established by the Business Process Improvement Committee formed by President William R. Brody last summer. The BPIC, chaired by Alfred Sommer, dean of the School of Public Health, is a wide-sweeping initiative charged with examining everything about the way Johns Hopkins does business.
Other task forces of the BPIC currently are examining travel services, standardized purchasing of selected goods and services, academic leadership training and mail services.
Reitz said the financial business practices of research administration were viewed as her task force's top priority because grant money allocated for research constitutes more than 50 percent of the university's total revenue.
The monies coming into Hopkins are, overall, managed very well, according to Jerry Bridges, controller and a work group member.
"Hopkins is nationally known for its accurate grant management. However, to accomplish this, there is an extraordinarily significant effort on the back end to ensure accuracy before we submit to funding sources," Bridges said.
A question the work group wrestled with, however, was how much of this "back end" work was necessary.
The committee's first step was to examine the current practices and protocols in terms of the research administration business cycle, from processing a grant proposal and account setup to project management and account closure.
Currently, when a grant is awarded, the accounting system follows three basic steps: An account number is established, that number is then linked to the related grant award and, lastly, a budget is established for expenditures. Each step requires a separate form to be submitted.
Some weaknesses in this process, according to work group findings, are that expenditures are allowed as soon as an account number is established, and there is no mandatory requirement for a budget to be established in the accounting system. This means an investigator can potentially spend research money before it is linked to the grant award, thus creating a billing delay to the sponsor. There is also no mechanism currently in place to flag instances where budgets or expenditures exceed grant awards.
"For every unbilled dollar, that is a dollar you do not have," Reitz said. "We are spending in real time, but we are not billing our sponsoring agencies as soon as we could. It's this lag time that creates an opportunity for discrepancies in account information."
To increase the accuracy and timeliness of financial information, the work group has recommended implementing the university-wide use of a Budget and Account Setup Information System, software that was launched into development by the Controller's Office in July 1998.
BASIS, a screen prompt-based program, is intended to simplify the account setup process by combining the functionality of existing documents into one user-friendly, Web-based document. Once fully implemented, Reitz said, BASIS can provide more effective internal financial controls and significantly improve both the integrity and accuracy of account information for internal and external parties.
Reitz said a standardized format for initial data entry would erase the need to duplicate the data entry process when an account is closed.
For investigators and nonfinancial research staff, the implementation of BASIS also means they eventually will have up-to-date grant account information available at their fingertips. A subcommittee of the financial business practices work group is currently designing a "simple to follow" interactive screen for monitoring and managing research grant accounts. Assuming a user had a ready link to the Internet, this screen would be accessible from any remote location.
The committee is currently in the design phase for both the account setup and Web-based account access systems.
"It could take up to one year to actually roll out full implementation," Reitz said. "But within the next couple of months we will have completed the functional requirements that will allow us to proceed with implementation."
Reitz said the significant progress achieved by the work group is a testament to the commitment of its members, a group that has met at least every other week since September.
"I've been very, very impressed with the interest of the work group members during the entire project," Reitz said. "They come energized, they come excited, and they always have an upbeat and can-do attitude. This is a very complex and sometimes boring subject, but we have been able to gather together senior leadership across the university to take a very serious look at financial business processes associated with research administration. I think they all realize our work really does touch in one way or another almost every person associated with the university research effort."