The University Record, July 10, 1995
Effective July 1, a one-year parallel test period of the value centered management (VCM) budget model was implemented.
The current budget system will be used for all real-time applications during the one-year period. The VCM model will be used for review purposes to give experience and understanding to users.
The one-year parallel test period, administrators were told in a late June memo, "will provide an opportunity for users to gain greater understanding of the new process as well as prepare for its final implementation July 1, 1996." The test period will also allow for any necessary adjustments.
Departments will be held budget-neutral for the 1995-96 budget year, with no adjustments made to budgets based on the VCM model.
Full implementation of VCM, including adjustments made during the one-year parallel test, will take place July 1, 1996. Budgets for fiscal year 1996-97 and subsequent years will be adjusted per guidelines established with the adjusted VCM model.
The memo to vice presidents, deans, directors and department heads from several executive officers noted that they are "excited about the implementation of the VCM model. It is our belief that it will move the University of Michigan forward and provide an opportunity for mastery of budgets on the local and general level. The one-year parallel test period will provide valuable information that will enhance the current model and assure the success of the new budget process," wrote President James J. Duderstadt; Farris W. Womack, executive vice president and chief financial officer; Gilbert R. Whitaker Jr., provost and executive vice president; and J. Bernard Machen, who will succeed Whitaker as interim provost Sept. 1.
"We are committed to working with you and others in the University community during the year to make certain that the final version of VCM adopted is responsive to the responsibilities, challenges and opportunities facing our University. We look forward to the next year as we work with this new and exciting challenge," they added.