Proposal to James Irvine Foundation

A Proposal to

THE JAMES IRVINE FOUNDATION

to support a

PERFORMANCE-BASED FACULTY COMPENSATION SYSTEM

(University of Southern California: November 1995)

The University of Southern California respectfully requests that the James Irvine Foundation make a grant of $183,000 to support the planning and preparation of a performance-based compensation system for USC faculty with the understanding that the university will make a second request to the James Irvine Foundation for a follow-up grant to develop and implement the system.

In recent years universities have come under increasing pressure to re-think and re-engineer the way in which they create and disseminate knowledge. A key ingredient to successfully changing traditional university procedures involves the development of performance-based compensation systems for both tenure and nontenure track faculty. The University of Southern California is committed to taking the steps necessary to plan for and successfully implement a comprehensive performance-based compensation system for its faculty. Such a system, developed at the university through the support of the James Irvine Foundation, will also have broad significance and applicability for colleges and universities throughout the United States.

The University of Southern California is well positioned to undertake a major restructuring of its faculty performance and compensation system. Issues related to the responsibilities and rights of tenured and tenure-track faculty have become a primary concern of the university's Academic Senate. This summer a faculty task force of the Academic Senate issued a white paper making a number of recommendations related to faculty workloads including a "strong recommendation that the university community consider ways to link salaries more closely to merit ratings." The provost's advisory committee to the USC School of Medicine, charged with developing a method to objectively measure the performance of individual faculty, also recently concluded that, "measurement and compensation must be coupled and recognize the performance of the individual, the department and the total organization."

Developing a Performance-bascd Faculty Compensation System
Developing a performance-based faculty compensation system requires a significant amount of detailed planning and preparation and would essentially fall into two phases. Phase one will focus on the initial planning and preparation leading to the implementation of the system, while phase two will involve the developtnent and implementation of a performance- based compensation system for USC faculty. Exhibit 1 details the specific uses of the $183,000 grant requested from the Irvine Foundation as well as a timeline for the first phase of this process.

Creating a Performance-based Compensation System
A performance-based compensation system for university faculty must meet several criteria. First, it must define appropriate workloads across the teaching, research, and service dimensions of the university, and it must develop measures of appropriate perfonnance in each of these areas. The system must also determine the linkages between faculty performance and compensation and create the faculty development procedures that will enable faculty to successfully perform the spectrum of their duties. The system must also be sufficiently flexible to accommodate the substantial differences in the academic missions and faculty size and composition that exist in various academic units. The establishment of these criteria is essential to successfull faculty performance assessment and must be closely studied and evaluated before the second phase of the program can be implemented.

As an example, faculty currently recognize that student advisement is an integral part of the educational process and represents an important component of their workload. However, most faculty have little training in this area, and often lack adequate information and support to properly advise their students. Therefore, for a university to significantly improve faculty performance in student advisement, it must make significant investments in faculty training and information systems to provide faculty with the tools to successfully perform this critical function of their overall responsibilities. A similar situation exists in the area of faculty teaching: evaluation measures for faculty must first be developed, followed by the implementation of faculty training programs in such areas as the innovative use of technology in the instruction process.

Performance-based Faculty Compensation System: Phase One
The first phase of the program will involve a nine-month period devoted to laying the groundwork for developing and implementing a performance-based faculty compensation system. Several activities during this period are crucial to the success of the program. First a joint faculty/administrative planning committee must be established in order to ensure substantial faculty involvement and commitment to the project. Second, the continuing participation of the university Academic Senate must be encouraged and enhanced. Academic Senate faculty work groups will develop working papers to define the issues involved in setting faculty workloads, measuring and evaluating faculty performance, establishing faculty compensation and incentive systems, and establishing faculty development procedures. These working papers will also serve as the basis for a national conference to be convened by the university, drawing together recognized experts in the field to examine the steps necessary in the creation and implementation of a performance-based faculty cornpensation system. During this phase, the measures that will be used to evaluate the success of Phase I will also be established, and a detailed proposal for the second phase of the project will be outlined.

Performance-based Faculty Compensation System: Phase Two
While the exact nature of the second phase of the program will be defined as the first phase evolves, it will most certainly involve the development of a performance-based faculty compensation policy initially concentrating on three academic units at USC, most probably the College of Letters, Arts, and Sciences, the School of Medicine, and a professional school such as the School of Business Administration. After a performance-based compensation system is developed and tested for these three schools, a university-wide system will be implemented based upon the findings of this project. Individual departmental policies will then be developed following the guidelines established by university and school policies.

Conclusion
The University of Southern California is in the forefront of efforts to increase academic productivity in the face of severe budgetary restraints. Enhancing faculty performance is a key component in improving academic quality. The steps outlined in this proposal allow the university, with the support and commitment of the James Irvine Foundation, to begin planning for the development and implementation of a performance-based faculty compensation system. This system, when implemented, has the potential to positively impact the quality of education at the University of Southern California, and other universities across the nation, for many generations to come.

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