Tuesday, April 17, 2007

Board Supports Outdated Business Practices

I don't know exactly how many pieces of mail are sent out annually by Rochester Community Schools, but I'm sure it's a fair amount.

But rather than consider alternatives that could provide cost savings, or entertain a discussion on moving more written communications to email, the Rochester School Board chose to continue to support outdated business practices that needlessly consume precious education dollars, and potentially chewed up $45,000 that could've been put to better use.

This is a small example of a big "thinking process" problem in education, and a sad example of the poor oversight provided by school boards.

The volume of mail generated by the district should allow the district to take advantage of the presorting services offered by service bureaus that provide substantial postage savings. These businesses make their profits by presorting the mail BEFORE it gets to the post office. The discount provided by the U.S. Post office is split between the service bureau and the customer. Here are a few examples of these service bureaus:

http://www.econmkt.com/

http://www.zipmailservices.com/

If the savings equal 15% - 20%, the service bureau might take 5% and the customer -- in this case the district -- would see a 10%-15% savings.

The board has not seen any figures on the total postage spent by the district, but it's not hard to picture a hefty annual postage bill for 21 schools and 2 administrative centers that support nearly 15,000 children and nearly 2000 employees. Other smaller school districts utilize such services and enjoy the cost savings.

But rather than even consider such a service, the Rochester school board chose to pay over $45,000 for a brand new postage meter. Purchasing this machine did have some advantages. The board was told that the machine will pay for itself within 2 years by eliminating the need to label envelopes by hand. That's great, but it doesn't take a $45K machine to eliminate that task. And, that machine does not entitle the district to the substantial presort discounts available from the U.S. Postal Service, which would generate tangible and immediate savings. Plus, keeping the work internal keeps another person on the payroll, with benefits.

Perhaps the administration and the board were unaware that these types of services and service bureaus existed, which would explain why no comparison or analysis was done prior to the recommendation. But the real concern here is that once this alternative was suggested, there were no questions or curiosity about the service, or the potential savings. Perhaps there might not be any savings, but nobody wondered whether the decision should be delayed in order to investigate the potential cost savings. Every comment was designed to defend the original administration recommendation.

Even in light of new information, school boards are programmed to press ahead with the original plan and unwilling to consider alternatives.

I believe this is worth mentioning because it serves as a great example of the narrow-minded thinking that is making Michigan schools so expensive to operate. Rather than considering other options, school boards simply rubber-stamp whatever is put in front of them.

The other point, raised by Trustee Steve Kovacs, was that the district should really be focused on trying to move more of the communications to email. Of course, there was resistance to that as well. Surveys conducted years ago were cited as the reason the district should stick with the U.S. Mail. That seems absurd, given that many of us receive some -- or all -- of our bills, checking account and investment statements, and many other documents electronically. In fact, millions of taxpayers filed their income tax returns electronically. How is it that schools are so far behind?

As long as schools continue with these outdated business practices, and are slow at adopting current business practices, the cost of educating our children will continue to needless rise.

1 comment:

David Zemens said...

I bet sometime during the discussion someone said "This is the way we have always done it", or words to that effect.

Keep raising the issues, Mike. Your following, and exposure, is growing.