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Business of IT >> More Than Money
6/27/2005
When business-savvy schools set out to build revenue-generating campus IT businesses, they uncover more than new revenue streams.
It was June of 2000, and the board of
trustees at Lansing Community College
(MI) brought in a strategic planner who had previously
done similar work for large corporations like
General Motors, Bristol Myers Squibb, and others,
recalls Glenn Cerny, CIO for the institution. “He
brought a strong business sense to the development
of the strategic plan for the college, driving home the
fact that state-funded higher education cannot continue
to operate as it has done in the past.” The IT
executive adds that the consultant’s stance was so
important because “appropriations are going to be
reduced in the future; the college simply has to
operate more on a business model.”
Consulting by demand. The result for LCC was the adoption of a metrics-based operational plan that measured return on investment for all programs. “But in order to perform comprehensive ROI analyses,” says Cerny, “you need a serious technology infrastructure that can get data out to people’s desktops instead of just allowing them to share spreadsheets.” According to Cerny, the ensuing process of moving the institution’s systems to a more state-of-the-art, accessible, and scalable Oracle (www.oracle.com) collaboration environment also created a strong IT group with not only valuable and marketable skills, but excess capacity, as well. It wasn’t long before word of those assets spread beyond the confines of the school. “Other institutions came to us directly, to ask about how we got Oracle Collaboration Suite up and running, how to create an ROI for each program, etc. Oracle brought us in on some accounts, as well, paying us for our consultation.”
For many US institutions of higher education, resource sharing isn’t just a happy accident, but a well-plotted goal. Take Drexel University in Philadelphia, for instance. Says John Bielec, Drexel’s VP of Information Resources and Technology, “Our President, Constantine Papadakis, came in with a vision of sharing resources, not just on an educational level, but on a business basis. It’s the wave of the future,” he maintains. In fact, Drexel began its foray into IT-services-as-business with a smaller school (the Allegheny University of the Health Sciences, which Drexel later acquired and renamed the the Drexel University School of Public Health), supplying to that institution the same services that it used itself.
Hosting for fun and profit. “We now have three components to our revenue generating IT operation,” Bielec reports. “The first is the complete suite of software systems that any college or university would need for student information, financial aid, student accounts receivable, administration, and grades. This includes the usual school-wide financial systems: GL/AP/AR/HR, and payroll. The difference is, we host all of it here at Drexel, use it ourselves, and also make it available to other schools— a classic ASP [application service provider] model.” The second component of Drexel’s IT “business” also follows a standard ASP approach: The university hosts SunGard’s SCT Banner (
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