New Shared-services Initiative at UMass to Save $16 Million During First Phase
BOSTON — The University of Massachusetts President’s Office recently announced the launch of its Unified Procurement Services Team, a shared-services project expected to save UMass more than $16 million in administrative costs over the first 12 to 18 months.
The newly established Unified Procurement Services Team (UPST) is the most recent step in the university’s ongoing efficiency and effectiveness (E&E) program that is allowing the university to direct more funds to student financial aid, academic programming, and deferred maintenance. The E&E program was first launched in 2012 to improve services while reducing overall costs. Not including the UPST initiative, the E&E program is projected to save $124 million through 2024.
“The savings realized through this program will allow us to continue making targeted, high-impact investments in the programs and facilities that benefit our students, and ultimately the Commonwealth,” UMass President Marty Meehan said. “This work is always critical, but especially so during a time of disruption across the higher-education landscape. As we ask families, the Commonwealth, Congress, and donors to do their part in supporting UMass, we have an obligation to do ours through innovative and collaborative management.”
The UPST consolidates multiple procurement operations into one single unit, reducing administrative payroll and leveraging the university’s purchasing power while increasing collaboration across the Amherst, Boston, Dartmouth, Lowell, and UMass Medical School campuses and improving service delivery.
The UPST is being led by David Cho, the university’s new chief Procurement officer, who joined UMass last fall after serving as chief Procurement officer of BlackRock, one of the world’s largest asset-management firms.
The savings realized through the E&E program are achieved through a combination of cost-reduction and cost-avoidance strategies. Since 2012, UMass has initiated 145 projects that are projected to result in more than $124 million in avoided and reduced costs by 2024, not including the projected $16 million in savings from the launch of the UPST.
For example, in 2019, UMass completed a comprehensive review and evaluation of the system’s banking services, resulting in annual savings of approximately $300,000, with a cumulative five-year savings of approximately $1.5 million. UMass also awarded and implemented a new janitorial-supply contract estimated at $3.5 million annually, a projected cost reduction of $580,000. In addition, energy-supply costs have declined, as have related carbon emissions per student and building square footage.