Happy New Year everyone, and welcome back to AUBG from near and far after the Winter break!
This is a lengthy email which contains important updates on AUBG’s restructuring and turnaround. I am excited to share my thoughts and optimism for our future, and I hope you take 10 minutes to read through it.
As we dive into the start of a new semester and a new calendar year, I take this opportunity to extend not just a warm welcome back on campus to you – our students, faculty, and staff – but to also tell you about how proud you should be of our first year together, and how excited I am about the year ahead of us.
To take stock, last year we had a challenging start for sure, with the transition to a new President and a new Executive Team often testing and setting the boundaries of how we settle into life together as a family. I demanded a lot of you and equally of myself. Some of you, especially our students, expected more of me than I could deliver, and I thank you for your patience as we continue to work to get things right. In retrospect, it was a rough year through and through, and for my part I learned a lot from so many of you.
We did have our shining moments and did something many thought impossible to do in a year – we succeeded in so much that I find it hard to put all AUBG accomplishments in an email and to acknowledge all of the great people who fueled our success. But let me try:
• we got the maximum 10-year US accreditation, and ranked #1 or #2 in Bulgaria across most of our majors
• our executive team is largely coming together as we got an infusion of new people, energy, ideas, and execution focus across the board with a new Provost, a new Dean of Faculty, a new HR Director, a new Enrollment Director, and now we prepare to welcome a new Operations & Finance executive
• alumni and large donors cast their vote of confidence as we raised almost $3 million in just 12 months, and doubled the alumni participation rate from 3% to 6%
• we joined an elite list of organizations as we raised funding, commissioned, and executed on a seminal strategic sustainability and organizational alignment project in collaboration with one of the Big 4s of strategy planning worldwide, thanks to the financial and legal support of our largest donor America For Bulgaria (ABF)
• we fixed a few major festering issues which had lingered for many years across multiple administrations: from finally designing and enacting a fair and equitable faculty compensation plan across nationalities, to making major strides towards employee performance management, to introducing stronger cost controls and transparency to AUBG spending
• we planted a flag and steaked our claim and aspirations to embrace entrepreneurship and innovation through our innovation hub Aspire, and we got a $300,000 grant from the US government to equip it
• we broke through the confines of our formerly encapsulated public, government, large donors, and community relations status over the past few years, and marked AUBG’s 25th anniversary in a truly spectacular, fun, and memorable fashion all year long on and off campus across several continents
So, we worked hard and made progress on multiple fronts. But it was painstakingly slow. In my experience with other organizations, such turnarounds take between 3-6 months, while we are just gearing up for true reform more than a year into it, and I know we can do a lot better. We struggled with execution and delivery of projects and initiatives across both the administrative and academic fields. Where it usually takes one unit of effort, at AUBG it took ten. What’s more, the assessment you all provided consistently through student surveys, employee surveys, and in many other forums did point again and again to the fact that AUBG was still largely bureaucratic, slow, inefficient, and overstaffed. I agree. Our Board of Trustees agree. Our large donors agree. Our alumni agree. We all agree. So how do we enable AUBG to prosper? Last year was a watershed moment. We were projecting a FY’17 budget deficit of up to $2.4 million in our long-range forecast as of October, but we may end up with a deficit of $1 - $1.5 million. Not a stellar set of numbers, but a material improvement over the previously projected trajectory.
We continue to operate with an outlook for a budget deficit, which could have increased to $3.5 million per year if we become complacent and give up reforms. In Fall 2016 we barely recruited just shy of 200 students. Even when we fix Enrollment in the next year or two and recruit 300 students per year *and* fundraise $2 million each year, we would still run up to $2 million annual deficits the way we live and work today. Pause and think about that. How does one solve this predicament? How do we continue to deliver on our noble Mission for years and years to come? How do we become self-sustainable for the long term and step up to pay our own bills?
Fortunately, there is a clear and simple solution. There is a way, albeit not an easy one, but I remember AUBG going through tougher times in our early days and we overcame. We can succeed and prosper if we execute on our Enrollment and Fundraising targets, and at the same time reduce our costs. To do so we must do all of the following:
• Reach our Enrollment goals of 270 new students in Fall 2017 and 290 new students in Fall 2018
• Generate at least $2 million in dollars raised from donors each fiscal year going forward
• Cut costs by $1.7 million vs. what we used to spend in a year
To achieve this, we need to materially improve the way we operate, collaborate, and deliver results:
• Do more with less
• Embrace a new organizational culture
• Execute, execute, execute
Each of us will have to do more work with less resources – fewer people, smaller cost budgets, tighter timelines. We need to remember what it felt like to make a positive difference and to do so together in a functioning team where people support each other while putting the team interest and AUBG before anything else. And the work has to move forward and get done come hell or high water.
All this requires some painful adjustments effective immediately. AUBG has been shielded for far too long from the market evolution and innovation in systems and processes that have swept through the world over the past 20+ years. We somehow work as if it is the good old 1990s – paper everywhere, narrow specialization of employees, a fixed working hours administrative schedule. What the new reality demands from us is something quite different – optimized systems, efficient processes, and multi-faceted job positions. AUBG needs to increase the scope and breadth of each person’s abilities and responsibilities, empower and encourage experimentation, flexibility, mobility, and entrepreneurship, and eliminate the fear of failure and embrace honest mistakes as a learning mechanism.
Our new organizational structure is designed to help us achieve exactly that. Just a few short weeks ago I spoke at the last Town Hall meeting of the semester about what you should expect come January 31, so there should be no surprises now. AUBG is reorganizing into clear lines of responsibilities, and asking less employees to take on a larger volume of work and on a broader set of responsibilities with more opportunities for initiative, accountability, and professional and personal growth. In the process of this evolution a little over 20 employee positions will not exist in the new organization. The executive team, the Board, and I have grappled with the moral and human life repercussions aspects of this decision day and night for many weeks now. That is why we are managing the reorganization with the utmost focus on our people – both those who will stay and those whose positions will be closed. As the largest private employer in Blagoevgrad for years, AUBG will continue to act in a socially responsible and considerate way towards our employees. As a default, we are offering all employees negatively affected by the reorganization a severance package which costs AUBG much more than other options available to us under the Bulgarian labor law. Major benefits, such as the full tuition waiver for all current employees will continue if a dependent is already enrolled in an AUBG academic program, even after an employee leaves the organization due to the restructuring on January 31.
The reorganization process itself was thoroughly planned and is being executed with the expert advice from an experienced consulting company with substantial track record and skilled advisors in the field of organizational restructuring in Bulgaria. All related process steps and documents have been proven to be compliant with Bulgarian Labor Law, and the consulting team has been working closely around the clock with the AUBG HR team for several weeks to ensure we assess and assign employees to available positions as much as possible. AUBG managers were asked to evaluate the performance of employees under management following a clear selection framework. An AUBG committee consisting of representatives from AUBG, the consultants, and alumni has reviewed each manager’s evaluation, and recommended specific actions to me. Ultimately, the decision about each department and position is that of the President, and I have given all available information considerable time and thought before making each decision.
In a few hours come tomorrow, Wednesday, I will meet personally many of you to explain how the changes will impact you in particular. This is very important – in some cases people will have an opportunity to receive expanded responsibilities, in other cases there may be a different scope of work, so please come to my office when invited to do so by your manager or by HR.
Our AUBG Vision 2030 is “To be the definitive center of excellence for learning, teaching, and working together in Southeast Europe”, and going forward we will relentlessly focus our efforts, resources, and creativity to improve AUBG’s position as a preeminent educational institution and a premiere employer, bar none. I expect from all of us to constantly develop our skills, to continue to show unwavering commitment and dedication to AUBG, and to work hard for the prosperity of our beloved AUBG.
We will talk more once I return from our Board meeting in the US on January 31, and I plan to have our first Town Hall meeting of 2017 in early February. I will also be meeting many of you on a regular basis while we push through the restructuring of AUBG into a modern and successful university to become a benchmark for many to admire and follow. With your support, we can do it. I am asking for this support now, and in return I will work hard and exemplify at all times the values which will make the new AUBG a place of which we can all be truly proud. As an alumnus from the very first class of 1995, I promise to give AUBG and you my full energy and focus.
For any questions or comments, I encourage you to reach out to your HR partners at hr@aubg.edu or email me at president@aubg.edu. As always, I am happy to take questions from you at any time.
Warm regards,
Stratsi
Stratsi Kulinski, AUBG’95
President