Merger as Strategic Project

The Case of the University of Duisburg-Essen, Germany

HEDDA ConferenceUniversity of Oslo

November 4, 2011

1. Context

2. Mergers

3. The merger of the universities of Duisburg and Essen

4. Critical success factors

• The University and the Polytechnic in the city of Luneburg, Lower Saxony (2004)

• 3 smaller Polytechnics in different cities in Lower Saxony (2000), reversed in 2009

• University of Technology of Karlsruhe and Helmholtz Research Centre (2006)

• 2 Universities in the two cities of Essen and Duisburg (2003)

Mergers in Germany

UDE: Two cities, two campuses

Two medium seized universities (2003)

Duisburg Essen

Students

ca. 15.000 ca. 21.000

Positions 2003

ca. 208 Professors ca. 297 Professors (+ ca. 77 Medicine)

ca. 390 Academic Staff ca. 431 Academic Staff (+ ca. 643 Medicine)

ca. 561 Admin. and technical Staff

ca. 775 Admin. and technical Staff

Budget

ca. 113 Mio € ca. 137 Mio € + ca. 367 Mio € (Medicine)

Third Party Expenditures

ca. 20 Mio € ca. 39 Mio € + ca. 18 Mio € (Medicine)

Subjects

Full Range (without Medicine and Law)

Full Range (without Law)

Academic Subjects•Humanities (Languages, Culture, Theology, Education)•Social sciences, Economics, Business Administration•Sciences•Life sciences, Medicine, University hospital•Engineering (Mechanical, Electrical, Civil)

Budget448.2 mill. € total revenue

(114.3 mill. € Faculty of Medicine)

91.5 mill. € revenues from third-party funds (29.2 mill. € Faculty of Medicine)

Profile and Budget (2010)

Personnel 415 professors 2,529 academic staff 1,325 administrative and technical

services(without Medicine)

Students34,016 students (41 % female, 15 % international)10,120f first-year students (54 % females, 17 %

international)3,996 graduates (56 % female, 13 % international)

Personnel and Students (2010)

1. Context

2. Mergers

3. The merger of the universities of Duisburg and Essen

4. Critical success factors

1. Main drivers: • Efficiency and Effectiveness (“Do more and

better with less”)• Higher visibility and reputation

2. Means: Transfer of quantity to quality (e.g. more professors enable deeper specialisation and better research)

3. Risks: All energy to the internal structure and little attention to stakeholders (“Exhausting process of self-occupation”)

4. Governance and Leadership: Universities as “Professional Organizations” and loosely coupled systems.

Some characteristics

MergerPre-Merger Post-Merger

Vision andConception

(Due Diligence)Implementation

Continuous Improvement

Immediate costs, long term wins

1. Context

2. Mergers

3. The merger of the universities of Duisburg and Essen

4. Critical success factors

02/2001 Final Report of Expert Group set by the Government NRW

09/2001 Start of negotiations between the two universities (external moderator till autumn 2002);

Spring 02 Voting out of the rector in Essen

Summer 02 Merger by Law: Dissolution of the two universities and incorporation of the new University of Duisburg-Essen (12/02); Timetable for Merger from 1/03 – 12/2006

12/2002 Legal action against appointment of Founding Rector by the state government

01/2003 State commissioner (till 09/2003)

Spring 03 Joint search committee for Founding Rector, rule of unanimity

10/2003 Coming into office of the Founding Rector

11/2003 Election of 4 new Vice Rectors, 2 from each campus

12/2003 The two Heads of Administration early released

06/2004 Coming into office of the new Head of Administration

Course of Events

Objectives 2003

• Academic Structure of Campuses (Profiles)– Complementary Profiles– Interdisciplinary connections

• Finances– Internal redistributing– Little additional costs– Better position in the performance based

budgeting system of the state NRW

• Quality – Strengthening of research capacity (Problem:

Past as complementary universities)– Attractiveness of study programs

Policy of “two speeds”

2004: Structure • Academic profiles of campuses• Organisational structure (Academic, Services)

2005: System of Strategic Planning • Central goals• Decentred strategic development• Contract Management• Budgeting system• Controlling

2006: Quality, Evaluation, Improvement• Evaluation of Structure• Quality Management System

CentralSteering

DecentralSteering

2003 2004 20062005

Decentralization

16

„Change Management“• Kurt Lewin: Defreeze, change, refreeze

• Communication: Each semester “Plenary assembly”

• Acting and Reflecting: Once a year a “strategy workshop” outside the university with the new Deans and the administrative management

Duisburg

SocialSciences

School ofEducation

Life Sciences

Humanities

Essen

Engineering

Economics

Infor-mation

Systems

7

„Ideal” Profile

Duisburg Essen

School ofManage-mentSocial

Sciences

Physics,Information technology,Engineering

School ofEducation

Humanities

Life Sciences

Civil Engineering

Economics,Information systemsM

athem

atics

Mat

hemat

ics

6

Achieved Profile (2006)

QE mit dem ZfH

Universit ä reEinheiten

ZLVMit demRektorat

Entwicklungspl ä neInst. Evaluation

MetaevaluationUmsetzung

ZLV mit dem Rektorat

Institut. Evaluation mit dem ZfH

strategief ä hige

Organisationseinheit

ZLVMit demRektorat

Entwicklungspl ä neEvaluation

Metaevaluation Strategische Ziele

Strategische Planung

mit dem Rektorat

Personal - /Organisationsentwicklung

Informationssystem:

Lehrevaluation, Absolventenbefragungen, Controllingdaten, Rankings

QE mit dem ZfH

Universit ä reEinheiten

ZLVMit demRektorat

Entwicklungspl ä neInst. Evaluation

MetaevaluationUmsetzung

ZLV mit dem Rektorat

Institutional Evaluation

Faculties asStrategic Units

ZLVMit demRektorat

PerformancesPeer Review

Self Report Strategic Goals

Rectorate

Personel Development

Information-SystemMonitoring, Controlling

:

Elements of the QM-System (2006)

Perfomance indicators 2001 - 2010

2001 2003 2005 2007 2008 2009 2010

Doctoral Degrees(without Medicine)

169 251 241 250 260 208 236

Doctoral Degrees(incl. Medicine)

310 386 420 387 402 342 419

Graduates(Incl. Medicine)

2.257 2.362 2.488 3.442 3.584 3.993 4.065

Number of Students 36.314 37.039 33.816 30.691 31.080 31.839 34.026

First-year Students 7.702 8.919 8.179 6.519 7.529 7.094 10.130

Third party expenditures (without Medicine)

34.219 37.731 33.739 41.126 43.186 47.849 60.021

Thereof German Research Funding Organization

12.149 12.026 9.993 12.282 13.700 14.667 16.961

1. Context

2. Mergers

3. The merger of the universities of Duisburg and Essen

4. Critical success factors

Critical factors for success

• Pre merger: Due diligence, more than a “management fad”

• Merger : Internal Structuring vs. „Regular Business“ • Time: „Quick and dirty“ vs. Sustainable and Slow”• Balance between Stability and Change (Lewin)• Extra financial support during the merger stage by the

government– Performance Budget– Buildings, IT, Libraries

• In case of two campuses: The subject identity replaces slowly the local identity

Goal Setting by Leadership

Goal Setting by the system

Process Setting by Leader-ship

Process Setting by the system

„Machine Model“Hierarchy

Structure 2004

„MPM-Model“ (MbO)Competition

Contract Management 2005

„Systemic Model“Observation, Reflection

Institutional Evaluation 2006

„Gardener Model“Trust and Evolution

Continuously

Leadership and Governance