Demand and Supply – A New Twist on an Old Concept: Demand and Supply – A New Twist on an Old Concept Closing the Loop for Full Service Life-- Are We Getting What We Paid For? APA, FPD 2006 San Antonio, Texas


The Plan…: The Plan… Context Demand and Supply – A Performance Management Solution USCG Example Introduction


Before We Begin…: Before We Begin… Acknowledgements USCG Capt. Mike Valerio (ret.) MLCPAC, CEU Oakland, CETC Staff SFCAM Roadmap Team The Environmental Analysis Group Gerald Davis, Françoise Szigeti and team Introduction


Some Terminology…: Some Terminology… Program/Portfolio Management Enterprise level Am I doing the right things? Facility Management Building or project level Do we have the right stuff with the right capabilities? Project Management Day-to-day project level Am I doing them right? Master Planning The territory between “what is” and “what ought to be” Introduction


Context: Context Federal Real Property Management Pressures


Crumbling U.S. Infrastructure1: Crumbling U.S. Infrastructure1 Aviation: D+ Bridges: C Dams: D Drinking Water: D- Energy: D Hazardous waste: D Navigable waterways: D- Parks: C- Rail: C- Roads: D Schools: D Security: I 1. ASCE March 2005 Context


Common Issues: Common Issues Aging and Neglected Infrastructure Investment risk Quality of life/safety impacts Mission risk BRAC, Transformation, and Other Competing Needs Reactionary Management Stovepipes and Gamesmanship Context


Pressure to Reform…: Pressure to Reform… Congressional Pressure to Perform GPRA – 1993 Federal Acquisition Streamlining Act – 1995 Clinger-Cohen Act – 1996 Various EOs (13327, 13287, 13148) GAO: High Risk Designation – 2004 Context


Common Goals: Common Goals Better align asset investment decisions with mission objectives and budget realities Transform functional, project-level business focus to an integrated, portfolio-level framework of planning, investing, using and divesting decisions What’s New? Capacity to integrate, capacity to aggregate Information is the key Context


Supply and Demand: Supply and Demand Suitability Assessments as a Performance Management Solution for Federal Real Property


Performance Management: Performance Management Definition “The Performance approach is [..] the practice of thinking and working in terms of ends rather than means.” Added focus “It is concerned with what a building or a building product is required to do, and not with prescribing how it is to be constructed.” (Gibson, E.J., Working with the Performance Concept in Building, CIB Publication No. 64, 1982)


Conceptual Framework: Two Languages: Conceptual Framework: Two Languages SUPPLIER Supply chain participants understand and respond appropriately HOW CAN ONE OR MORE SOLUTIONS meet the requirements? Assess capability to perform WHY is it REQUIRED? Describe mission and purpose CLIENTS Provide input. Both users and customers understand Compare & Match WHAT is REQUIRED? Define ends and expected results in support of business OR other mission


Example: Range Requirements Related to Investment Decisions: Example: Range Requirements Related to Investment Decisions BOTTOM LINE POM inputs must be portfolio level and linked to training needs! IADS/CADS Roadmap Analysis or Alternatives Solutions Bed Down Schedule POM Submission


The Basics…: The Basics… Define Functionality (F) Requirements Rate Serviceability (S) Match/Compare F and S Analyze gaps Map Suitability (where is there good fit, or over/ under supply?) Considers multiple perspectives e.g. condition, suitability, AT/FP, environmental Define projects to affect gaps Note: Method developed by ICF, ASTM standard and recognized ANSI standard


The Innovation…: The Innovation… Set scalar levels of demand and supply for numerous performance attributes quantifiable, repeatable, comparable, transparent


Calibration Rules: Calibration Rules For Functionality Requirements 9 = Most demanding functionality requirement for this subject matter. 7 = Special functional requirement, clearly more than level 5, but not the most demanding. 5 = Typical mid-range and normal functional requirement. 3 = Least tolerated requirement for support of this function, program or service. Clearly less demanding than a mid-range requirement 1 = Least temporary requirement, not accepted in a permanent facility. 0 = Must not have this in a facility, system or component. Never acceptable. For Rating Serviceability 9 = Indicators of the highest level of functional capability likely to be found. 7 = Functional capability that is clearly more than level 5, but not the most capable found in office facilities. Will meet a level 7 requirement. 5 = Typical mid-range capability for this functional category, in the whole country or region. 3 = Functional capability that is clearly less than level 5, but is appropriate for some situations. 1 = Functional capability or performance that would barely be tolerated in any setting. 0 = Not present, or do not have or not applicable.


Compare Capability to Requirements: Compare Capability to Requirements


Building Does Not Meet Requirements: Building Does Not Meet Requirements


Example: Thermal Comfort: Example: Thermal Comfort Requirement is level 7, for acceptable thermal comfort almost all the time. Rating is level 1. Occupants near outside walls need fans on warm days, and wear sweaters when cold outside.


Example: Ventilation (Air Supply): Example: Ventilation (Air Supply) Requirement is level 7: Quality of incoming air must meet established industrial hygiene standards. Rating is level 1. The incoming air intake is badly located, vulnerable to exhaust fumes from vehicles, and to sabotage.


Example: Structural Analysis: Example: Structural Analysis Requirement is level 9. Rating is level 9. Floors can support 300 lbs./sq.ft. which is sufficient for row after row of dense library shelving.


Example: Tenant Needs: Example: Tenant Needs Occupants require a level 9 because they have so many stored tapes of video and audio programs


Example: Setting Requirement Levels: Example: Setting Requirement Levels What do you need to be able to do, or see, or hear, or experience, or not experience, to get the job done? Users do not ask for luxury. Among user groups, high accuracy and consistency. Design team or facility managers typically propose different allocation of funds, to get what they see as a “good” facility.


Multiple Perspectives: Service Life and Condition: Multiple Perspectives: Service Life and Condition For portfolio and asset managers, and priorities for annual budgets and projects 9 = Require full functionality for next few years. No R&A expenditures. 7 = Condition may have only minor effect on functionality. No significant R&A expenditures in budget. 5 = Fully functional, but accept typical problems due to age. Will budget some R&A. 3 = Will budget for major repair, rehab or alteration. 2 = Facility, system or component only marginally or partly functional. Likely will dispose of it. 1 = Will dispose of facility, system or component. 0 = Must not have this facility, system or component.


Degradation During Service Life: Degradation During Service Life 25


Requirement Levels Change During Service Life: Requirement Levels Change During Service Life 26


Closing the Loop for the Enterprise Life Cycle: Closing the Loop for the Enterprise Life Cycle Integration of planning, acquisition, management and disposal functions Approach


From Building Specific to Enterprise Views: From Building Specific to Enterprise Views


Cross Functional Metrics: Cross Functional Metrics Strategic Planning (Enterprise) Level Facilities Readiness Gap (FRG) Relative Mission Importance (RMI) Mission Dependency Index (MDI) Facility Management level Condition Index (FCI) System Criticality Index (SCI) Flags (F)


Next Generation : Next Generation In the future, data will be reported on all these metrics The relative importance of each will be taken into account when allocating funds and setting project priorities. 30 Diagram by Françoise Szigeti and Gerald Davis in collaboration with SHIP Technologies, Inc. © 2003, 2004 International Centre for Facilities


Data Stamps Summarize Key Facts About Each Asset: 31 Data Stamps Summarize Key Facts About Each Asset


Suitability Gaps, weighted for importance : Suitability Gaps, weighted for importance Shortfalls at each site are weighted for importance for the missions of the organization


How Well Does Each Base Support the Needs of Each Unit?: 33 © 2003 International Centre for Facilities, Inc. How Well Does Each Base Support the Needs of Each Unit?


Integrated Decisions: Integrated Decisions IDM Overview


Results: Useful, reliable, affordable data: Results: Useful, reliable, affordable data Accurate current data (most likely when the people who provide and enter the data are also the people who will use it) Enough detail, but only enough, for scope of forthcoming fact-based decision-making Compare (gap analysis) what is or what will be against what is required, whenever practicable Integrated data management for performance-based building


Proven: Proven ISO 9000 congruent ASTM / American National Standard ISO Committee Draft – Methodology of demandsupply comparison French version created in collaboration with CSTB (Centre Scientific et Technique du Bâtiment. Demonstration project won IFMA France’s First 2004 Award. Links to Performance/Objective based Codes and the Performance based approach – PBB / PeBBu


Links to ISO 9000 -- Quality Chain - Audit trail: Links to ISO 9000 -- Quality Chain - Audit trail ISO 9000 compatible - “Closing the Loop”: “Did we get what we asked for?” “Can we measure/verify that what is produced, or what we buy, or what we rent, meets our Statement of Requirements?” We need Fitness for Purpose “at a given cost”. We need affordable, appropriate quality. No more, no less. We have new requirements. There are no existing solutions. We need the suppliers to be innovative.


Example – USCG Regional Allocation Process: Example – USCG Regional Allocation Process Linking Project Value to Mission Requirements


Existing Business Practices: Existing Business Practices Logistics are measured with key performance indicators e.g. CASREPS/SORTS measure percent of time assets are fully mission capable Operational Assets (Cutters/Boats/Aircraft) are apportioned to mission areas for budgetary purposes Many metrics are already in-place to aid decision-making Have long-term investment in Shore Facility Capital Asset Management improvements


MLCPAC Case Study: MLCPAC Case Study Civil Engineering has been developing metrics to prioritize and recommend funding since FY04 Engage operational community in logistics support processes Leverage existing information, collect once and use in multiple decisions Leverage IT to process/display data consistently Simple weighted algorithm of metrics to prioritize 5,000+ projects Simple improvements each year


Basics: Basics CE projects are prioritized for funding using a standardized method Weighs Mission Commander’s and Logistics Professional’s input from an Enterprise perspective Builds on SFCAM initiative Entering 3rd iteration


Traditional Allocation Methodology: Traditional Allocation Methodology Maintenance funding allocated according to maintenance backlog and plant replacement value Installation-centric approach Parochial, Ad-hoc decision-making (squeaky wheel syndrome) Reactive vs. Proactive Decentralized and unstructured


A New Approach: A New Approach Invest where it is needed most Quantify and capture mission requirements Consider Region-wide benefits and impacts Measure, document, and justify repeatable decisions


Regional Allocation Process: Regional Allocation Process Considers the entire Pacific Area in a comprehensive approach Internalizes Command Requirements in decision-making Engages operational community in logistics process Uses existing information, with minimal new data Leverages IT


Allocation of Resources to Best Support Operations: Allocation of Resources to Best Support Operations 45 © 2006 International Centre for Facilities, Inc.


You Need It When?: You Need It When?


Data Collection: Data Collection Leveraged existing data FCI MDI Flags Modeled SCI based on building use codes and inventories Step-wise collection of new data FRG, RMI


FRG Data Collection: FRG Data Collection Web-based Multiple Topics related to Missions Respondent rates requirements/ capabilities on a scale of 0 - 9


RMI Data Collection: RMI Data Collection Includes the entire Command cadre Determined for all missions in the AOR Relationships between missions were projected onto logistical assets supporting those missions


Unprecedented Procedure: Unprecedented Procedure Obtained repeatable, defensible results aligned with USCG strategic objectives Embedded mission and ops requirements into logistics decision making procedures Assessed all logistics readiness (50% of the FRG data address non-shore) Allows direct comparison of “mission value” of projects


Process: Process Each metric is modeled, normalized, and scored Weights are applied according to policy Each project is scored according to a simple algorithm 4FRG + 2RMI +Flags +[(2FCI+SCI)*MDI/100)*1.09]


Funds Allocation Step: Funds Allocation Step Allocation tool allows flexibility based on availability of data, weighting policy, etc Supports development and testing of different scenarios Allows identification of off-the-top projects Supports “projects-du-jour” (e.g. housing, ATON, etc) Supports analysis of multiple funding streams Supports mid-year corrections


Review the Backlog: Review the Backlog


This Year Only Please: This Year Only Please


Details Please: Details Please


Funding Themes and Scenarios: Funding Themes and Scenarios


Why Did They Get More?: Why Did They Get More?


Sustainable?: Sustainable?


Summary: Summary Fact based Mission driven Embeds the voice of the various commanders in each line item of the backlog Flexible


Summary: Summary Integrates Master Planning, Facility Management Operations, Finance, Human Resources, Communications Natural and Built Infrastructure Cross-Cutting, Enterprise-Wide Strategic Planning and Prioritization Detailed Facility-Level Management Projects-du-jour Multi-unit/multi funding stream analysis Scenarios and what-ifs


Thank You: Thank You Jeff Villnow TEC, Inc. jdvillnow@tecinc.com