ocareviewfinalreport.docx

ocareviewfinalreport.docx

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ocareviewfinalreport

THEOFFICEOFCONTRACTADMINISTRATIONREVIEWTEAM

FinalReport

Presentedto

MarvinParnes

AssociateVicePresidentforResearchandExecutiveDirector,DRDA

PeggyNorgren

AssociateVicePresidentforFinance

August2004

ThefollowingreportispresentedtotheAssociateVicePresidentforResearchandtheAssociateVicePresidentforFinancebythemembersoftheOfficeofContractAdministrationReviewTeam.

PatriciaFink,InstituteforSocialResearch

OwenJansson,CenterforHumanGrowth&Development

MaryKlimecki,SchoolofPublicHealth

EricKruse,FinancialOperations

BarbaraRice,EECS

CatherineThibault,InstituteforSocialResearch

JamesThomson,UMTransportationResearchInstitute

AmyWade,CenterfortheAdvancementofClinicalResearch

TableofContents

ExecutiveSummary1

IntroductionandCharge2

SummaryofMajorRecommendations/Observations4

AdministrativeHomeandSignatureAuthority5

OneStopShopping6

UtilizationofM-Pathways8

OutsideConsultant（G-2）Activity10

Invoicing10

StaffingRecommendations11

Multi-CenterClinicalTrials14

DecisionTree16

Flowchart17

ExecutiveSummary

TheOfficeofContractAdministration（OCA）ReviewTeamwasconvenedinOctober2003inresponsetounresolvedissuesidentifiedintheDecember2002SponsoredProgramsImplementationTeam（SPIT）FinalReport.Thefollowingdescribestheissues,approachandrecommendationsresultingfromthebusinessprocessreviewoftheOCAanditsinteraction/interdependencewithotherunitsinvolvedintheprocessingofawards,amendments,contracts,subcontractsandrelatedfunctions.TheReviewTeam’sprimaryfocuswastoidentifysystemicorrootcausesofimpedimentstoservicedeliveryandthentoexploreopportunitiesforsolutionsthatwouldimprovethequalityandtimelinessofthoseservices.

Throughoutthisprocess,theOCAReviewTeamexpendedthegreatestamountoftimeresearching,deliberatinganddebatingtherationale,criteria,andauditandcomplianceissuessurroundingthedistinctionbetweenasubcontractandapurchaseorderandtheconsequencesofmisclassification.Attheconclusionofthisongoingdiscussion,thefollowingwereultimatelyaccepted:

∙Theexistingcriteriafordeterminingasubcontractorpurchaseorderrelationshiparefundamentallyclearaswritten.

∙Therewillalwaysbeinstanceswhenthedeterminationisnoteasilyorreadilyapparent.Inthesecases,thesubstanceofthearrangementismoreimportantthanitsform.

∙Thelocusofresponsibilityforfinaldeterminationshouldresidewithintheareaultimatelychargedwithcomplianceand/ordefendingthedetermination,FinancialOperations.

∙Therearecompellingfiduciaryandcompliancejustificationsthatwarrantongoingseparationofdutiesintheprocessesreviewed.

∙ApprovalandExecutionofUniversityDocuments,Sec.3.07,oftheRegent’sBy-lawsappropriatelydelegatessignatureauthorityoversponsoredresearchagreements.

Guidedbytheseprinciples,theReviewTeamsoughtsolutionsforissuesidentifiedintheFinalSPITReportbyexploringopportunitiestobefoundthrough:

∙ImprovementsinBusinessProcess

∙UtilizationofM-Pathways

∙Staffing

Furthermore,thereviewprocessvalidatedconclusionsfoundintheSPITFinalReport:

∙Changeisinevitableandoursystemsandprocessesshouldbesubjecttoongoingreview,evaluation,andimprovementmeasures.

∙Cross-functionalteamsengagedincollaborativeproblemsolvingproducethebestoutcomesfortheorganization.

∙Communicationatalllevelsoftheorganizationiscrucial.

IntroductionandCharge

TheSponsoredProgramsImplementationTeamFinalReportissuedinDecember2002includedarecommendationforabusinesspracticereviewoftheOfficeofContractAdministration.ThisresultedfromaseriesofcriticalissuesidentifiedbySPITaswarrantingfurtherinvestigation.Actinguponthisrecommendation,theAssociateVicePresidentforResearchMarvinParnesandtheExecutiveVicePresidentandChiefFinancialOfficerTimothySlottowchargedtheOfficeofContractAdministrationReviewTeamwiththetaskofreviewingfunctionswithintheOCAwithspecialattentiongivento:

∙Signatureauthority

∙Administrativeoversightforsubcontractsandothersub-awards

∙Thecriteriafordeterminingasubcontractorprocurementarrangement

∙Consultingagreements

∙Staffinglevels

TheTeamwasencouragedtoincludeathoroughreviewofrelevantmetrics,tobenchmarkworkloadandstaffinglevels,toexpandonthe“rolesandresponsibilities”outlinescreatedbySPIT,toincludeawiderangeofconstituenciestovalidatetheissues,prioritiesandperceptionsoftheoutlinesandtoconsidertheworkflowoftheOCAanditsinteractionswithotherstakeholdersincludingDRDA,PurchasingandFinancialOperations.TheTeamwaschallengedtolookbeyondtraditionalunitboundariesandtoseekcreativesolutionsforbusinessimprovement,improvedcustomerservice,efficienciesandtimelinessofservicedelivery.

TheTeammetweeklybeginninginNovember2003.Asbackgroundinformation,theTeamreviewedtheSPITFinalReportaswellasaninformalsurveyconductedwithotherinstitutionsregardingthemanagementofresearchsubcontracts.TheTeamalsoconsultedearliersimilarreviewsincludinga1997BusinessProcessReviewofsubcontract,consultantagreementsandpaymenthandlingprocessesthatwasusedinpreparationfortheimplementationofM-Pathways.TheTeamreferencedRegents’BylawsandRegents’PolicyConcerningResearchGrants,Contracts,andAgreements.MembersdelvedintocompliancerequirementscontainedinOfficeofManagementandBudget（OMB）CircularsA-133andA-110,reviewedtheOfficeofNavalResearch（ONR）auditsandtheA-133ReportsonFederalAwards.

Throughoutthecourseofthereview,weconductednumerousinterviewsandconsultedwith:

∙RobertBarbret,AssociateDirectorFinancialOperations

∙ElaineBrock,AssociateDirector–DRDA

∙JackieCreager,BusinessSystemAnalyst,MAIS

∙JeanetteFrost,MAISManager

∙PeterGerard,FinancialManager–OCA

∙DennisPoszywak,AssistantDirector,UniversityProcurement

∙JamesRandolph,SeniorAssociateDirector–DRDA

∙AnnaSchork,ProjectRepresentative–DRDA

∙CherylSoper,ControllerandDirectorFinancialOperations

∙KathrynWarner,SeniorContractAdministrator-OCA

TheTeamalsodiscussedissuesandconsultedwiththeirrespectiveunitsaswellasreportedbacktoandsoughtfeedbackfromSPIT3.WeresearchedbestpracticesemployedbyotherresearchinstitutionsspecificallybyvisitingandresearchingtheBigTenresearchwebsites.

TheOfficeofContractAdministrationReviewTeamreportofissuesandrecommendationsfollows.

SummaryofMajorRecommendations/Observations

∙TheadministrativehomeoftheOfficeofContractAdministrationandthedelegationofsignatureauthorityshouldremainunderthepurviewoftheExecutiveVicePresidentandChiefFinancialOfficerforBusinessandFinance.

∙TheOfficeofContractAdministrationshouldhaveprimaryresponsibilityfortheappropriatedetermination,subcontractorpurchaseorder,fortheacquisitionofexternalservices.

∙Theexistingcriteriafordetermininganacquisitionrelationshiparefundamentallyclearaswritten,however:

oOCAshouldbepoisedtoprovideproactiveconsultativeservicesattheproposalstage

oAstronger,ongoingeducationaleffortincludingadditionalRAINtrainingshouldbedeveloped

oClarificationlanguageshouldbeincludedonthePAF

oTheSubcontractvs.PODecisionTreeshouldbereinstatedontheDRDAwebsite

∙Thereshouldbeamechanismthatprovidesfinancialreliefunderappropriatecircumstanceswhentime-of-awarddeterminationsreclassifysubcontractstopurchaseorders.

∙Subcontractsandsubcontract-likearrangementsshouldbemaintainedintheM-PathwaysProcurementsystem.

oAPOtypeofSUBshouldbeestablishedtodifferentiatesubcontractsfromotherprocurementactivity

oTwoaccountdistributionsidentifyingtheamountslessthanandgreaterthan$25,000shouldbeenteredonsubcontractsmaintainedinM-Pathways

oThedefaultBillToAddressontheProcurementHeaderPanelshouldbechangedtotheOfficeofContractAdministration

oUnitsshouldnotberequiredtocreaterequisitionsinordertoestablishsubcontractsinthesystem

∙TheOfficeofContractAdministrationshouldworkwithAccountsPayabletobecomeanAPHUB.

∙TheOfficeofContractAdministrationshouldcollaboratewithMAIStodevelopreportsandqueriestomanagesubcontractactivity.

∙AnexistingPurchasingpositionwithfullprocurementauthorityshouldbeassignedtotheOfficeofContractAdministration.

∙Anadditionalprofessionalpositiontosupportcomplexsubcontracts,amendments,termsandconditionsiswarranted.

∙TheOCAshouldreviewitsOfficeAssistantIVpositionforpossiblereclassificationconsideration.

∙OutsideConsultant（G-2）activityshouldbeunderthepurviewofPurchasing.

∙OCAshouldmaintainsubcontractstatusinformationontheweb.

AdministrativeHomeandSignatureAuthority

TheSPITFinalReportrecommendedabusinessprocessreviewoftheOfficeofContractAdministrationwiththegoalofimprovingthetimelinessofservicesprovidedbythatOfficetotheUMresearchcommunity.Ofparticularandrecurringconcernhasbeenthelonglead-timeassociatedwiththeestablishmentandsignatureapprovalonsubcontractsandthenegativeimpactsuchdelayshaveontheconductofresearch.Insomeinstances,thisproblemisexacerbatedbytime-of-awarddisagreementsastowhethertheacquisitionofexternalservicesshouldbehandledasasubcontractorpurchaseorderandthe