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2. Final Report - branch process review program, |
Committee RecommendationS
That Council:
1. Receive, for information, the findings
and recommendations for efficiencies resulting from the Branch Process Review
Program for the Real Property Asset Management branch;
2. Approve the establishment of six (6)
full-time equivalent (FTE) positions within Venture Property (four) and Real
Estate Services (two) divisions in order to generate $369,000 of permanent
savings, and
3. Approve the establishment of two (2)
full-time equivalent (FTE) positions within Corporate Security and reinvest
$137,000 of efficiency savings to fund the positions.
RecommandationS du comité
Que le
Conseil :
1. Reçoive,
à titre d’information, les résultats et les recommandations pour des
améliorations à l’efficacité découlant du Programme d’examen des processus en
vigueur dans les directions pour la Gestion des biens immobiliers;
2. Approuve
la mise en place de six (6) postes équivalent temps plein (ETP) au sein de
Biens à risque (quatre) et des Services immobiliers (deux) tel que soutenu dans
les analyses de rentabilisation et résumé dans le document 2; et
3. Approuve
la mise en place de deux (2) postes équivalent temps plein (ETP) au sein de
Services de sécurité et réinvestisse 137 000 $ à partir des économies
d’efficience pour financer les postes.
Documentation
1. Executive Director's report (Business
Transformation Services) dated 15 May 2007 (ACS2007-BTS-EXD-0001).
Report
to/Rapport au :
Corporate Services and Economic Development Committee
Comité des services organisationnels et du
développement économique
and Council / et au Conseil
Submitted by/Soumis
par : Stephen Finnamore, Executive Director, Business Transformation Services /
Directeur exécutif,
Services de transformation des activités
Contact Person/Personne
ressource : Jane Wright,
Manager, Corporate Service Branch Process Review
Program
(613) 580-2424 x24340, Jane.Wright@ottawa.ca
REPORT RECOMMENDATIONS
That the Corporate Service and
Economic Development Committee recommend Council:
1. Receive,
for information, the findings and recommendations for efficiencies resulting
from the Branch Process Review Program for the Real Property Asset Management
branch;
2. Approve
the establishment of six (6) full-time equivalent (FTE) positions within
Venture Property (four) and Real Estate Services (two) divisions in order to
generate $369,000 of permanent savings, and
3. Approve
the establishment of two (2) full-time equivalent (FTE) positions within
Corporate Security and reinvest $137,000 of efficiency savings to fund the
positions.
RECOMMANDATIONS DU RAPPORT
Que le Comité des services organisationnels et
du développement économique recommande que le Conseil :
1.
Reçoive,
à titre d’information, les résultats et les recommandations pour des
améliorations à l’efficacité découlant du Programme d’examen des processus en
vigueur dans les directions pour la Gestion des biens immobiliers;
2.
Approuve
la mise en place de six (6) postes équivalent temps plein (ETP) au sein de
Biens à risque (quatre) et des Services immobiliers (deux) tel que soutenu dans
les analyses de rentabilisation et résumé dans le document 2; et
3.
Approuve
la mise en place de deux (2) postes équivalent temps plein (ETP) au sein de
Services de sécurité et réinvestisse 137 000 $ à partir des économies
d’efficience pour financer les postes.
In November 2005, City Council established the Branch
Process Review Program (BPRP) to review the delivery of city programs and
services to ensure that they are run efficiently and effectively and to help managers
identify potential savings. The goal was that any identified savings would
contribute to the city’s annual efficiency targets.
Throughout the last few years, the Real Property Asset Management (RPAM) branch has undergone a number of comprehensive reviews including the Integrated Business Solutions project, the Universal Program Review, an Alternative Service Delivery (ASD) strategic assessment and several audits in relation to real estate services, property management and the use of overtime. In response to many of these reviews and budget reductions, RPAM has already eliminated $16.8 M from its budget since amalgamation.
In April 2006, the RPAM branch management team volunteered to be one of the first two BPRP pilot projects by completing a full series of reviews. The BPRP process was seen as an opportunity to again review branch processes and operations to explore further efficiency gains. The Terms of Reference were approved by Corporate Services and Economic Development Committee July 4, 2006 and included: a review of the service desk operations, an operational review of the Nepean Sportsplex, an analysis of significant service contracts, a review of the accommodation move processes, an assessment of the potential cost savings of consolidating works yard facilities, and a review of single-pad arenas. The report also indicated that other opportunities could be brought into the scope of the project once the analysis commenced.
The project team of three full-time resources was led from the Strategic
Initiatives and Business Planning division of the Office of the Chief Corporate
Services Officer. The team also engaged part-time
support from the Information Technology Services, Financial Services and
Employee Services branches. KPMG consulting firm advised the project team on
the methodology and participated in key deliverables throughout the duration of
the project.
The RPAM branch management team was
also involved in providing information, participating in the analysis and
responding to the proposed recommendations.
The project team met with RPAM branch management on a bi-weekly basis to
keep them informed on the progress of the project and to discuss key issues.
In addition to a review of all
existing documentation, the project team interviewed over 30 management
staff from both within RPAM and client departments.
Overall,
the review demonstrated that RPAM is a highly effective and efficient branch
that has created strong working relationships with their client partners. There
is a pride of ownership exhibited by the staff, and a strong in-house business
expertise exists. Furthermore,
the review showed that RPAM has been proactive in creating a culture of
excellence where staff are
continuously looking for opportunities to capitalize on efficiencies.
In addition to the general findings, the
project team identified and reviewed a total of 18 specific areas for potential
savings and/or process efficiencies. Those areas ranged from specific processes
with respect to service requests through to a branch-wide organizational
assessment. Document 2 of this report provides a summary of each of the
reviews.
The reviews identified that
approximately $1.065 M in permanent annual savings can be realized from the
RPAM operating budget. This represents
a permanent reduction of $5.215 M from 2007 to 2012. Thirty-five per cent ($369 K) of these forecast savings are
contingent on the establishment of six
(6) full-time equivalent (FTE) positions: four (4) FTEs within Venture Property
and two (2) within Real Estate Services. Detailed business cases in this report
explain the annual savings achievable through in-sourcing services in these
divisions. Should these positions not be approved, estimated annual savings
will be reduced to $696 K.
Of the estimated $1.065 M in savings, it is being recommended that $137 K be reinvested to offset the cost of the additional two (2) FTEs required in Corporate Security. The net annual savings to the City will be approximately $928 K.
When the savings of the BPRP review are factored in, the overall savings in RPAM since amalgamation total over $17.7 M, representing 15 per cent of RPAM’s 2006 gross operating budget.
The methodology used for the
review allows for a variable degree of accuracy during the different phases;
therefore savings may have to be adjusted as a project moves from concept to
implementation. At this point in the methodology, the high-level design phase,
the proposed savings are at a magnitude of +/- 30 per cent accuracy. The savings will be realized over the next
four years based on a detailed analysis and implementation, as well as
technology requirements being approved through the Informatics Technology
Services value assessment process.
One of the key components of the BPRP was the introduction of the challenge sessions (both formal and informal), attended by public and private sector providers of similar services offered by RPAM. The project team was able to draw upon the knowledge and experience of 13 industry professionals to assist in developing new and innovative ways to deliver RPAM’s range of services. The results confirmed that while all organizations are structured differently, RPAM’s existing service delivery model has been recognized as fairly unique among the municipal environment, adopting a centralized landlord model allowing for: efficient inventory control, full integration and consistent delivery of real property services across all properties, a coordinated approach to asset rationalization, reporting on asset condition and the ability to manage each facility throughout its entire life cycle (from the time the project is conceived through to its disposition).
Overall, the participants of the challenge sessions were impressed with the branch’s service delivery model and innovative initiatives as compared to external public and private industries. The conclusion that came out of the sessions is that the RPAM branch incorporates many leading edge industry practices that contribute positively to how well RPAM runs its operations.
RPAM’s Alternative Service Delivery review showed that Ottawa is leading municipal practice in the areas of strategic portfolio management and life cycle planning as well as its investment in technology with a strong ability to monitor and track full cost of ownership to the facility level for all City owned facilities. The branch has harmonized service contracts and continues to balance internal and external resources through prudent contract management ensuring best value for money. While all organizations struggle with the same types of issues, RPAM has succeeded in implementing many leading edge industry practices, which contribute positively to a well-run operation.
An internal steering committee was also established to challenge the final recommendations and provide consultation advice, providing direction to the project team and validating the recommendations.
En novembre 2005, le Conseil
municipal a mis en place le Programme d’examen des processus en vigueur dans
les directions (PEPD) en vue d’examiner la prestation des programmes et des
services municipaux afin de veiller à ce qu’ils soient exécutés de façon
efficiente et efficace et d’aider les gestionnaires à cerner des économies
potentielles. L’objectif était de faire en sorte que toute économie cernée
puisse contribuer aux objectifs d’efficience annuels de la Ville.
Au cours des dernières années, la Gestion des
actifs et des biens immobiliers (GABI) a subi différents examens complets y
compris le projet Solutions commerciales intégrées, l’Examen général des
programmes, l’Évaluation stratégique de la diversification des modes
d’exécution (DME) et plusieurs contrôles concernant les services immobiliers,
la gestion immobilière et l’utilisation des heures supplémentaires. En réponse
à de nombreux de ces examens et à des réductions budgétaires, la GABI a déjà
éliminé 16,8 M$ de son budget depuis la fusion.
En avril 2006, les gestionnaires de la
GABI se sont portés volontaires pour que la direction soit visée par l’un des
deux projets pilotes du PEPD afin de subir une série d’examens complets. Le
processus du PEPD était perçu comme une occasion de revoir une fois de plus les
processus et opérations de la direction afin de trouver de nouveaux endroits où
faire des gains d’efficience. Le mandat a été approuvé par le Comité des
services organisationnels et du développement économique le 4 juillet 2006
et comprenait : un examen des opérations du bureau de services, un examen
opérationnel du Sportsplex de Nepean, une analyse des contrats de service importants,
un examen des processus de déménagement des installations, une évaluation des
économies potentielles liées à la consolidation des installations de la cour
des travaux publics et un examen des arénas ayant une seule surface. Le rapport
indiquait également que d’autres occasions pourraient être amenées dans le
cadre du projet une fois que l’analyse aura débuté.
L’équipe
du projet comprenant trois employés à temps plein était dirigée par la section
Initiatives stratégiques et planification opérationnelle du bureau du chef des
Services généraux. L’équipe a également engagé des employés de soutien à temps partiel des Services
de technologie de l’information, des Services financiers et de la Direction des
services aux employés. Le cabinet d’experts KPMG a conseillé l’équipe du projet
sur la méthodologie et a participé aux produits clés pendant toute la durée du
projet.
L’équipe de gestion de la GABI a
également participé à la transmission de renseignements, à l’analyse et à la
production de réponses pour les recommandations proposées. L’équipe du projet a
rencontré les gestionnaires
de la GABI toutes les deux semaines afin de les tenir informés de la
progression du projet et de discuter des principales questions.
En plus d’un examen de toute la
documentation existante, l’équipe de projet a interviewé plus de
30 gestionnaires de la GABI et des services clients.
Dans
l’ensemble, l’examen a montré que la GABI était une direction très efficace et
efficiente qui a créé de fortes relations de travail avec les services clients,
que le personnel montrait un sentiment de fierté et d’appartenance et qu’une
expertise d’affaires interne solide existait. De plus, l’examen a montré que la
GABI a créé de façon proactive une culture d’excellence au sein de laquelle le
personnel cherche constamment des occasions de maximiser l’efficience.
En plus des résultats généraux, l’équipe du
projet a cerné et examiné 18 secteurs spécifiques où il pouvait y avoir
des économies potentielles ou des améliorations à l’efficience du processus.
Ces secteurs allaient des processus spécifiques concernant les demandes de
service à des évaluations organisationnelles dans l’ensemble de la direction.
Le document 2 de ce rapport donne un résumé de chacun des examens.
Les examens ont cerné qu’on
pourrait obtenir environ 1,065 M$1,065 M$
en économies nettes
annuelles permanentes pouvaient
être obtenus au sein du budget de fonctionnement de la GAABI.
, ce qui représente une réduction permanente de
5,215 M$ de 2007 à 2012. Trente-cinq
pour cent (369 k$) des économies prévues dépendent de l’établissement de six
(6) ETP : quatre (4) ETP pour Biens à risques et deux (2) pour Services
immobiliers. Dans le présent rapport, des analyses de rentabilité détaillées
expliquent les économies annuelles qui peuvent être réalisées en se procurant
des services dans ces divisions. Si les postes ne sont pas approuvés, les
économies annuelles prévues se réduiraient à 696 k$.
De ce montant, il est recommandé que
137 k$ soient réinvestis pour couvrir les coûts des deux postes ETP
supplémentaires requis au Service de la sécurité générale. Les économies
annuelles nettes se chiffreront environ à 928 k$.
Lorsque les économies de l’examen du PEPD
seront incluses, les économies totales à la GABI depuis la fusion se chiffrent
à plus de 17,7 M$ et représentent 15 % du budget de fonctionnement
brut de la GABI pour 2006.
La méthodologie employée pour l’examen permet
un niveau variable de précision au cours des différentes étapes; ce qui fait
que les économies peuvent être ajustées au fur et à mesure qu’un projet
progresse de sa conception à sa mise en œuvre. À l’endroit où se situe la
méthodologie à l’heure actuelle, l’étape de la conception évoluée, la précision
des économies proposée se situe à plus ou moins 30 %. Les économies seront
obtenues au cours des quatre prochaines années selon l’analyse détaillée et la
mise en œuvre et selon les exigences technologiques approuvées par l’entremise
du processus d’évaluation de valeur des Services de technologie de
l’information.
L’une des
principales composantes du PEPD était la mise en place de séances sur les défis
(tant officielles que non officielles), auxquelles des fournisseurs de services
semblables à ceux de la GABI des secteurs public et privé ont participé.
L’équipe du projet a pu tirer profit des connaissances et de l’expérience de
13 professionnels de l’industrie pour l’aider à élaborer de nouvelles
façons innovatrices d’effectuer la prestation des services de la GABI. Les
résultats ont confirmé que, malgré que les organisations soient structurées
différemment, le modèle de prestation de services actuel de la GABI était
unique dans l’environnement municipal, par l’adoption d’un modèle de
propriétaire centralisé permettant : un contrôle efficient de
l’inventaire, une intégration complète et une prestation uniforme de services
de biens immobiliers entre toutes les propriétés, une approche coordonnée pour
la rationalisation des biens, la production de rapports sur la condition des
biens et la capacité de gérer chacune des installations dans l’ensemble de son
cycle de vie (à partir du moment de la conception du projet jusqu’à
l’aliénation).
Dans
l’ensemble, les participants aux séances de
révision ont été impressionnés par le modèle
de prestation de service
de la direction et ses initiatives novatrices par
rapportaux industries externes et privées. La
conclusion qui est ressortie
de ces séances est que la GABI
intègre de nombreuses pratiques d’avant-garde
de l’industrie, ce qui vient s’ajouter
de façon positive à
la manière efficace dont la GABI
gère ses affaires.
L’examen
de la diversification des modes d’exécution de la GABI a montré qu’Ottawa était
un chef de file du secteur municipal pour ce qui est de la gestion stratégique
du portefeuille et de la planification du cycle de vie ainsi que de
l’investissement dans la technologie permettant un contrôle et un suivi serrés
des coûts complets de propriété au niveau de l’installation pour toutes les
installations que possède la Ville. La direction a harmonisé les contrats de
service et continue d’équilibrer les ressources internes et externes par une
gestion prudente des contrats favorisant la meilleure valeur pour les sommes
investies. Bien que toutes les organisations aient à résoudre des problèmes
semblables, la GABI a réussi à mettre en œuvre de nombreuses pratiques
avant-gardistes au sein de l’industrie, ce qui contribue au bon déroulement des
opérations.
Un comité directeur interne a également été mis
en place pour vérifier les recommandations finales et donner des conseils quant
aux consultations, donner une orientation à l’équipe du projet et valider les
recommandations.
BACKGROUND
In the setting of the 2005 Budget Directions, the City adopted the principle that Council and residents of Ottawa should expect yearly savings from service delivery improvements, efficiencies and innovation. As a result of this direction, the Executive Management Team includes a yearly reduction target in the annual Budget Directions Report.
The efficiency target approved by Council in 2005 was $9.5 M and subsequently in 2006 was $15.1 M. The efficiency target in the 2007 budget was set at $11.5 M.
To complement the principle of ongoing service delivery improvements, in November 2005 the City Manager put forward a recommendation to Council to approve a Branch Process Review Program (BPRP). The main objectives of the Program were to ensure that the programs and services provided to residents by the City of Ottawa are run efficiently and effectively and to help managers identify potential savings that would contribute to the annual efficiency targets for the City.
This Program is also directly linked to the commitment to manage resources in an effective and efficient manner and to seek continued improvement as indicated in the Accountability Agenda of the City Corporate Plan.
As part of the Program, all branches will undergo a comprehensive, in-depth review within a six-year cycle. On November 9, 2005, Council approved the Program and agreed to commence with a pilot phase to test the methodology, tools and training that needed to be developed and customized specifically for the City of Ottawa BPRP.
The report approved by Council indicated that the City Manager would inform Council of the two branches selected for the pilots. As well, Standing Committees of Council would have the opportunity to participate at key milestones during each review and approve the Terms of Reference.
During the first quarter of 2006, the KPMG consulting firm was selected through a competitive process to provide the methodology, tools and training for the Program and customize it for the City of Ottawa. The purpose of purchasing a “tried and true” methodology was to ensure that all branch reviews would be put through the same rigor used in other public sector organizations and the private sector when conducting business process reviews.
In April 2006, the Real Property Asset Management (RPAM) branch volunteered as one of the first two pilot projects. Corporate Services and Economic Development Committee approved the Terms of Reference for the Real Property Asset Management branch pilot project on July 4, 2006.
The Terms of Reference identified a number of areas that would be reviewed based on a preliminary assessment of the RPAM organizational structure, significant documented business processes, existing benchmarking data, and current service levels.
The Terms of Reference also identified that the project team would utilize the methodology developed for this project, and look for other opportunities that could be brought into the scope of the project, or alternatively parked for future reviews.
DISCUSSION
The RPAM vision for the delivery of services introduced the concept of a
‘Corporate Landlord’, an entity that would hold all program property and
provide turnkey property management and professional services to program
occupants of the real property assets required for their respective programming
areas.
For the past five years, the RPAM branch has held and managed all real property
related to the programs of all City departments. It provides professional management and care of the City of
Ottawa’s properties and buildings, ensuring program operators have the
appropriate facilities in a safe and secure manner to support their activities,
while ensuring minimum cost to the taxpayers.
RPAM is responsible for:
o
real
estate services including the real property inventory, leasing, property
valuation and legal documents
o
corporate
real estate development projects
o
environmental
remediation of City land
o
architectural,
landscape architectural and engineering services;
o
energy
management and building automation
o
accessibility
audits and improvements
o
accommodation
planning and interior design services
o
design
and construction management services
o
asset
and staff protection
As of September 2006, RPAM
had an annual net budget of approximately $95 M (with a gross operating budget
of $121 M) and 729 FTEs.
A current summary of assets being managed by RPAM is as
follows:
|
Asset |
Measurement |
|
Total
properties (land) |
3,790 |
|
Total
area of land |
67,744
acres |
|
Number
of buildings owned |
902 |
|
Number
of buildings in which space is leased |
87 |
|
Gross
area of major buildings |
12.6
M square feet |
|
Total
replacement cost |
$2
billion (all improvements) |
|
Average
age of facilities |
35
years |
Throughout the last few years, the RPAM branch has undergone a number of comprehensive reviews including the Integrated Business Solutions project, the Universal Program Review, the Alternative Service Delivery (ASD) strategic assessment and several detailed audits conducted by the Auditor General in relation to real estate service, property management and use of overtime.
One of the most important reviews with respect to RPAM’s service delivery model was initiated in March 2004. As part of the ASD review, the Corporate Research Group (CRG) was retained to examine the outsource initiative of the federal department of Public Works and Government Services (PWGSC) - Real Property branch (RPB) and to consult private sector service providers. The purpose of this review was to determine the merit of involving the private sector in the delivery of facility services, review RPAM's service delivery model and examine other municipal service delivery approaches, as well as conduct a municipal benchmarking/best practice review.
Based on its research, CRG concluded that RPAM’s service delivery approach, using a mix of in-house and contract service providers, is broadly consistent with municipal practice, with two noteworthy distinctions:
The findings of the report
entitled "Alternative Service Delivery Review Corporate Landlord Services”
indicated that although RPAM is already as efficient in many areas as its
counterparts (i.e. cross-utilization of staff, leveraging contracts and
existing supplier relationships, capitalizing on technology, and energy
management), there are still some areas where there may be opportunities for
efficiencies. These further efficiencies
will be advanced as funding is approved for further technology improvements;
and as energy retrofits to reduce consumption requirements and strategic asset
management strategies are developed and approved by Council.
The Auditor General also completed an audit of real estate management within the Real Estate Services division of RPAM in 2005, and a property management audit to be released in 2007. The 2005 review identified a number of processes and organizational changes that could potentially realize efficiencies. A number of the management responses indicated that the BPRP would be used as a mechanism to address some of these issues. The remaining issues have, or are, currently being implemented by the management group. The 2007 audit identified several funding requirements to ensure public safety within City facilities and long-term sustainability of this infrastructure.
In response to many of these reviews and budget
reductions throughout the years, RPAM has already reduced its budget by $16.8
M since amalgamation. The
following financial chart demonstrates RPAM’s financial reductions.
Type
of Reductions |
Examples
of Reductions |
Savings |
Total |
|
Direct
reductions and savings approved by Council (2001-2006) |
·
Integrated Business Solutions (IBS SAP)
process reviews and systems implementation ·
Streamlined
organization (Trades, Service
Desk and Maintenance Planners)
·
UPR & organization changes ·
Reduction in housekeeping services ·
Corporate Accommodations Master Plan
(CAMP) |
$2.7M $.96M $.92M $2.2M $3.5M |
$10.3M |
|
Indirect
pressures absorbed by RPAM organization |
·
Un-funded facilities (no budget, no FTEs) ·
Heritage Reserve Fund projects ·
Maintenance of fleet equipment ·
Benefits and stranded overhead ·
Technical Standards Inspections (Province) · Inflation
2001 to 2003 (not including utilities) |
$1.9M $.17M $.12M $1.5M $.1M $1.8M |
$5.6M |
|
Efficiency targets
approved in 2005 |
·
Staffing efficiency ·
Organizational realignment ·
Professional consulting
|
$.025M $.075M $.040M |
$.14M |
|
2006 Operating Budget omnibus motions |
·
Deletion of vacancies and increased
gapping ·
Reduction in fleet |
$.6M $.14M |
$.74M |
Total
|
$16.8M |
||
Performance Measurement
The branch also participates in several performance measurement programs to assist the RPAM management team in managing for continuous improvement and providing residents with value for their tax dollars.
Where We Stand: City of Ottawa Ontario
Municipal Benchmarking Initiative 2005 Performance Benchmarking Report
released by the City Manager on January 16, 2007 demonstrated that the City of
Ottawa RPAM branch has the most comprehensive facilities inventory of any of
the fifteen participating municipalities. Furthermore, the cost per square foot
to operate administrative facilities in the City is at or below the OMBI
median, with City Hall operating at a lower cost of $7.52 per square foot,
compared to the median of $8.88 per square foot amongst the OMBI municipalities. Ottawa is also in-line with most
municipalities in meeting accessibility requirements in select administrative
facilities.
The RPAM branch also participates in other performance initiatives such as the Executive Management Committee scorecard, which includes performance measures on organization-wide issues of importance and critical parameters of City performance. The scorecard incorporates measures relating to customer service, human resource issues, operational issues and financial issues. RPAM’s operational, sustainability and utility reporting permit branch staff to assess performance metrics for all facility types with a view to improve efficiencies.
BPRP Methodology
The BPRP prescribed methodology that was
developed by KPMG uses a typical six-phase business process re-engineering
approach. Details of these six phases
of the methodology can be found in Document 1. The BPRP methodology used by the
project team concentrated on the Opportunity Identification and the High Level
Design Phase.
A project
team, lead by the Strategic Initiatives and Business Planning division from the
Office of the Chief Corporate Services Officer was established. It was comprised of three full-time
resources, two external to the RPAM branch and one content expert from within
the branch. Part-time resources from
the RPAM, Financial Services, Information Technology Services and Employee
Services branches also participated in the reviews, to provide specialty
expertise. The RPAM branch management
team was very involved in providing information, participating in the analysis
and responding to the proposed recommendations.
During the
Opportunity Identification Phase, the team reviewed: RPAM’s service delivery
vision, model and mandate, salient reports including the Real Estate Management
Audit and the Alternative Service Delivery Corporate Landlord review, existing
service level agreements and significant process maps, budget documentation,
performance measurements, service standards, and benchmarking material. The
project team interviewed over 35 staff from different levels of the
organization, both from within RPAM and the client departments. The team also examined roles and
responsibilities and relationships between RPAM and other branches within
Corporate Services and client departments. During this phase, an IT/equipment,
facilities/fleet and human resources assessment was also undertaken.
At the end of the Opportunity Identification Phase, there was a preliminary estimate of costs and benefits of key opportunities for changes in processes, information technology, and human resources of approximately $750 K based on a +/-50 per cent accuracy as sanctioned in the methodology. It is not until the Implementation Phase that the actual savings can be calculated.
Analysis
and Findings from the Pilot Project
Overall,
the review demonstrated that RPAM is a highly effective and efficient branch
that has created strong working relationships with client partners. There is a
pride of ownership exhibited by the staff and a strong in-house business
expertise exists.
Furthermore,
the review showed that RPAM has been proactive in creating a culture where
staff are continuously looking for opportunities to capitalize on efficiencies.
This is demonstrated by the extent to which RPAM’s budget has also been reduced
or absorbed ($16.8 M) since amalgamation.
During the High Level Design Phase, the project team completed a more comprehensive analysis of the 18 areas identified below. They looked at the processes in more detail and created a new revised design that would be more effective and efficient. Financial targets are at a magnitude of +/-30 per cent accuracy at this point in the process. At the end of this phase, the team felt comfortable establishing a financial savings target of approximately $1.065 M based on the high level analysis completed at this stage.
During the Detailed Design Phase, the financial savings are refined based on a more detailed analysis and information to a magnitude of +/-10 per cent accuracy.
The completion of the High Level Design analysis resulted in a combination of recommendations that create a more effective branch, as well as areas where the branch could conduct business in a less expensive manner without impacting services and service standards.
The results from the analysis are included in Document 2 of this report and are summarized below. The recommendations from the High Level Design Phase have been approved by an internal Steering Committee that is chaired by the Chief Corporate Services Officer and includes a membership made-up of Directors from across the corporation.
Analysis
and findings from the Opportunity Phase and High Level Design Phase
|
|
Service Requests – This review assessed the entire
service request processes within RPAM and IT to determine whether there is
any efficiency to be gained. It
identified the opportunity to
streamline public inquiries through 3-1-1 and the need to define a standard protocol for ensuring
appropriate client feedback for service requests to improve client
satisfaction and continually measure improved service delivery. It also
identified the opportunity to see the eventual deployment of handheld technology
for field supervisors by supporting the migration of SAP to a web-based
solution to allow the branch to eliminate redundant and unnecessary process steps, as well as move data
capture to source to improve accuracy. The results showed that there are multiple
processes and mechanisms for receiving and documenting service requests
across the branch and confirmed the benefit of capturing all RPAM service
requests within SAP. |
|
Daily Activity Tracking – RPAM
currently has full activity tracking in the property management areas,
which requires daily activity sheets to be completed by all facility staff
and supervisors. This review identified opportunities to create greater
efficiencies and accuracy of daily time tracking required by the facility
operators and maintenance helpers through the expanded use of
technology. Approximately $200 K in
annual savings can be realized by implementing the use of bar-coding and
employee self-serve time entry for activity sheets. The return on investment to implement this new technology is
about two and a half years. |
|
Service Contracts – The scope of this review focused on assessing all major goods and services contracts managed by RPAM. The review explored whether service standards where too high and could be reduced. The results confirmed that specifications do not exceed those required and the organizational structure has the appropriate control mechanisms in place to ensure that the technical specifications are monitored regularly for quality assurance and to continuously improve contract specifications and service standards. Negotiated prices within the contracts are also in accordance with the nationally recognized price-monitoring indexes. As such, no high level design was initiated. The branch will continue to evaluate the business requirements and monitor contracts upon renewal to ensure a competitive process and that value for money is achieved. |
|
Accommodations and Internal
Move Process – This
review assessed the internal move process, including whether the types
of services provided by RPAM and the resource level is appropriate. The analysis showed that there are
opportunities to streamline the move process by acquiring space-planning
technology to automate processes and make the move process user-friendly. It
was also identified that there is a need to clarify the criteria for staff
moves and address inconsistent standards for offices in administrative
buildings versus non-administrative buildings. The results indicated that the City’s space standards are very
aggressive in comparison with the industry standard, but there are inequities
in the size and type of office space depending on whether the space is
located in an administrative or a program facility. The review also confirmed
the level of staffing that is in place is appropriate. The process to confirm
existing vacant space and office layouts is very manual, but until it is
integrated with a space management database, the move process is as efficient
as it can be with the current tools available. |
|
Trades - This review assessed the use of
trades by the RPAM branch and whether or not the appropriate level and
availability of service was in place at a reasonable cost to the
organization. The review identified
that the City relies heavily on the use of external trades to work in
facilities, but that it may be more cost effective to have more in-house
trades in some specialized areas. This would also ensure availability of
resources during emergency situations. There is an opportunity to save $160 K
annually by transferring appropriate funds from purchase of service budgets
to establish four new FTE’s (two Gas Fitters/Air Conditioning Technicians and
two Electricians). This action will
also ensure availability of required skills by re-balancing specific trades
to create more internal capacity to respond to emergency situations. |
|
In-sourcing Appraisal
Services/Environmental Remediation – The scope of this review looked at
the balance of internal resources and external service providers for property
appraisals as well as support to the environmental remediation program. The analysis identified that there may be
opportunities for savings by increasing the number of internal resources in
these areas while decreasing the use of external providers. Detailed business cases confirmed that
$209 K could be saved annually by creating one additional FTE each in the
areas of property appraisal and the environmental remediation program. |
|
Real Estate Inquiry Tracking - This review identified a minor
issue around the routing of inquires being directed to Real Estate Services
that are outside of their mandate. Process adjustments could be implemented,
as could a mechanism to ensure proper tracking and response. |
|
Corporate Security – The scope of this review included an operational assessment of the delivery of security services, the service delivery approach for monitoring fire alarms and the management of the Integrated Security Management System (ISMS). It identified opportunities to: clarify roles and responsibilities for corporate security, improve the standards for responding to security service requests; enhance reporting to clients on the status of incidents and improve efficiency by refining the integrated security management contract and in-sourcing fire alarm monitoring to reduce costs. Implementing the recommendations
of the review will see better communication of processes for obtaining
services, the establishment of an information sharing protocol with clients,
the development of updated service standards, and the completion of the ISMS
strategic plan. In addition, the reinvestment of two new FTE’s to supplement
existing security resources (investment of branch efficiency savings), will
provide the ability to regularly review and evaluate the security management
system to ensure value for money is being received. This initiative will also centralize the monitoring of the fire
alarm panel in the Security Operations Centre, eliminate outsourced
monitoring and re-align responsibilities to obtain the contractual expertise
for managing the security service maintenance contract. Savings of $100 K will be realized through
changes in the service maintenance agreement for the ISMS. |
|
Lease Management – The scope of this minor review was limited to the need for invoices to be mailed to lease holders of corporate properties. Preliminary analysis indicated that there might be opportunities to streamline processes by eliminating the preparation and mailing of the invoices. The results identified that invoices are required each month to facilitate accounts payment processing. There is also a requirement to clarify roles and responsibilities between Accounts Receivable and Real Estate Services staff. |
|
Revenue Leases – The scope of this review looked at the status and management of the leases that generate revenue for the City. Preliminary analysis indicated that there might be opportunities for increasing revenues by updating expired lease agreements and ensuring that all costs that leaseholders are obligated to pay the City are being invoiced and collected. The results identified that there were not a significant number of occurrences where the negotiation of leases was outstanding or where costs are not be invoiced and collected from leaseholders. |
|
Organizational Review – The scope of the organizational review assessed the mandate and service delivery model for efficiency opportunities, as well as compliance with human resource guidelines in the areas of span of control (amount of management and layers of supervision), staffing strategies for managing vacancies, status of job descriptions and job evaluation and a review of job credentials in specific areas. The review did not include whether the service delivery model should be changed, except in circumstances where process changes warranted a change in structure. While minor realignment opportunities were identified, the review found that RPAM is consistent with corporate guidelines in these areas and there was no rationale to change the structure or service delivery model. |
|
Project Management - This review assessed the project management approach taken in all areas of the branch, delegation from one area to another and the tools used to track projects given the significant investment in the Project Systems module of SAP. The assessment found that there is an opportunity to improve and standardize the use of the project management tool and methodology to manage projects throughout their lifecycle, as well as improve the varying levels of project management skills and expertise throughout the branch. An opportunity was also identified to improve the processes associated with the identification of a clear project management lead assigned to projects, and clear roles as project responsibilities move from one area of the branch to another over the duration of the project. This review will also see a further improvement and use of the Project Systems tool (SAP) currently being used by the Branch. |
|
Housekeeping (Community Centres) – This review assessed whether there is a higher standard of housekeeping services, and more internal staff to deliver these services, in the east district than the other three districts (central, west and south). The review identified the opportunity to assess service delivery mechanisms between internal and external resources on an ongoing basis to ensure client needs are met in the most efficient manner possible. The results indicate that the service delivery mechanism has a higher level of internal labour allocated to housekeeping in the east district than the other areas, but do not confirm a higher standard of housekeeping. They also indicate a need to define appropriate criteria by facility type to obtain better data for performance measurement with consideration of availability, reliability and cost of external resources in comparison with the need to balance core internal services to minimize risk around availability, reliability and ultimately client satisfaction. |
|
Housekeeping in Rural Fire Stations – The scope of this review was limited to the responsibility for housekeeping at rural fire stations. It investigated whether the use of volunteer firefighters for housekeeping was an effective use of resources. The results confirmed that the current approach of having the volunteer firefighters perform the housekeeping at stand-alone fire stations in comparison with contracting the cleaning to external suppliers is the most cost-effective method of service delivery. |
|
Utility Procurement (Natural Gas) -
This review assessed the ability to reduce natural gas budgets as a result of
the current utility procurement process.
It confirmed that being part of the public sector consortium has
provided opportunities for the City of Ottawa to save money that would not be
available if gas was purchased directly from Enbridge whose gas prices
fluctuate to reflect actual costs.
The building block approach to purchasing provides price stability in
the long term as well as a means to reduce costs. By buying in blocks
when prices are favourable, the average cost of gas is reduced in the long
term through fixed prices with built-in inflation savings. As a reflection of this efficient approach to buying natural gas, the
average savings to the City over the past four years indicate an ability to
put forward a reduction in the natural gas budget of $350 K at this time,
with possible additional savings in the future. |
All projects identified in the original Terms
of Reference were completed with the following exceptions.
Operational Review of Nepean Sportsplex
The original Terms of Reference identified that an operational review of the Nepean Sportsplex would be undertaken. The project team determined that the Nepean Sportsplex did not warrant a separate review to determine whether it was operated efficiently or effectively. Through the overall review, the project team looked at all significant processes such as housekeeping, building maintenance service standards, utilization of trades and staffing levels and could not determine any specific issues unique to the Sportsplex. Furthermore, there were no client relationship issues identified between RPAM and the Parks and Recreation branch. It is suggested that the Sportsplex and all recreational facilities be reviewed again by the facility management side for efficiency gains, once the Parks and Recreation branch has completed their branch review.
Two reviews identified in the original Terms of Reference - the Consolidation Plan for Work Yard Facilities and the Arena Divergence Analysis (developing a portfolio plan for single pad arenas) are not complete at this time and will be brought forward in a later report for Council consideration. The following provides an update on the status of these two projects.
Consolidation Plan for Work Yard Facilities
The Surface Operations branch of the Public
Works and Services (PWS) department is currently undergoing a Strategic
Alignment Initiative Program that will impact the real property portfolio
assigned to this branch. There are roughly nine facilities that may be declared
surplus to the Surface Operations branch.
This branch intends to identify funding to enable some of the planned
closures to proceed and integrate services at remaining work yard sites. The
Comprehensive Asset Management division (CAM) is lending assistance to the
strategic alignment initiative and to the consultants, Totten Sims Hubicki
(TSH), who have been retained by PWS to support the technical analysis. The
final report from TSH is expected in the spring of 2007. It will clarify, in
part, the list of buildings and facilities that should remain in inventory to
serve as area headquarters and satellite facilities.
The CAM division is completing strategic
assessment reviews of the facilities supporting Surface Operations. This will define the long-term capital
reinvestment requirements for these buildings and facilities. The final
delivery of these individual strategic assessments is expected to coincide with
the finalization of the strategic alignment initiative in 2007/08.
Arena Divergence Analysis
The
CAM division expects to complete the Arena Divergence Analysis (ADA) report in
Q2 2007. The report will summarize the degree to which 22 single-pad arenas
provide corporate value in terms of their design, affordability and
utilization. A series of recommendations will be highlighted, which will
address the capital re-investment plans for the subject arenas along with
specific retention, decommissioning or divestment initiatives that the City
might choose to consider.
The CAM division has worked closely with Parks and Recreation staff throughout the development of the divergence analysis process and the preparation of the report. It is expected that Parks and Recreation will present a subsequent report on the use and demand for artificial ice in the months to follow the release of the ADA report by RPAM.
There is caution going forward with solidifying financial saving at the High Level Design Phase. As mentioned previously the financial targets at this phase are at a +/-30 per cent accuracy. During the Detailed Design Phase, anticipated benefits still remain only rough estimates at +/-10 per cent accuracy. Financial savings should only be finalized once the implementation work is complete and the expected levels of benefits have been validated.
There are also a number of other risks/barriers that
may hinder the branch in achieving financial savings:
·
A
number of the business cases are predicated upon Council approving capital
financing and or approval of FTE’s to achieve the expected results.
·
Technology
solutions are required to go through an internal value assessment process for
approval and may not be considered a corporate priority when assessed against
all the other technological requirements.
·
The
implementation of new business processes is dependent upon having the internal
resources to complete the work, competing corporate priorities and partner
availability in supporting areas (ITS, ES, Finance, etc.).
The RPAM pilot project has identified approximately $1.065 M in permanent savings as a result of the review. This represents a permanent reduction of $5.215 M from 2007 to 2012. Thirty-five per cent ($369 K) of these forecast savings are contingent on the establishment of six (6) full-time equivalent (FTE) positions: four (4) FTEs within Venture Property and two (2) within Real Estate Services. Should these positions not be approved, estimated annual savings will be reduced to $696 K.
Of the estimated $1.065 M in savings, it is being
recommended that $137 K be reinvested to offset the cost of the additional two
(2) FTEs required in Corporate Security. The net annual savings to the City
will be approximately $928 K.
As mentioned previously the methodology allows for
an accuracy rate of +/-10 per cent during the Detailed Design, so savings may
have to be adjusted during this phase.
The savings will be realized over the next four
years based on a detailed analysis and implementation, and technology
requirements being approved through the value assessment process. Any capital
requirements to implement the savings will be requested during the appropriate
budget year.
Annual savings by review area
- when the savings will be achieved
|
FINANCIAL
TARGET |
RESOURCE
REQUIRMENTS |
||||
|
Opportunity |
2007 |
2008 |
2009 |
2010 |
Estimated one-time Capital Investment |
|
Energy Management |
$350,000 |
|
|
|
|
|
Fire Alarm Monitoring |
|
$46,000 |
|
|
$35,000 |
|
In-Source Trades |
|
$160,000 |
|
|
$137,000 |
|
Integrated Security
Management System |
|
|
$100,000 |
|
|
|
In-Source Appraisal
Services |
|
$93,000 |
|
|
|
|
In-Source Environmental
Remediation Services |
|
$116,000 |
|
|
|
|
Daily Activity Tracking
Automation |
|
|
|
$200,000 |
$500,000 |
|
Gross
Total |
$350,000 |
$415,000 |
$100,000 |
$200,000 |
$672,000 |
|
|
$1,065,000 |
|
|||
Permanent savings over six years
|
TOTAL SAVINGS OVER 6 YEARS (2007-2012 excluding
capital investments) |
|
|
Opportunity |
|
|
Energy
Management |
$2,100,000 |
|
Fire
Alarm Monitoring |
$230,000 |
|
In-Source
Trades |
$840,000 |
|
Integrated
Security Management System |
$400,000 |
|
In-Source
Appraisal Services |
$465,000 |
|
In-Source
Environmental Remediation Services |
$580,000 |
|
Daily
Activity Tracking Automation |
$600,000 |
|
Gross
Total |
$5,215,000 |
In accordance with the KPMG methodology, the project team’s mandate is now complete. In conclusion, this was an extremely successful pilot for a number of reasons. First, the review demonstrated that the RPAM branch is run highly effectively and efficiently and it identified gross annual financial savings of $1.065 M. Second, it has identified areas where the branch can be more effective both in terms of serving the public and the internal client departments. Third, the pilot tested the BPRP methodology and determined that with limited customization, the methodology was suitable to be used for future branch reviews under the BPRP.
A formal evaluation is currently being conducted by the Business Process Review Office and will be presented to the Executive Management Team for consideration in Q2 of 2007. Any recommendations coming out of the evaluation that are approved will be incorporated into future reviews.
CONSULTATION
Over 35 staff from across all levels in the organization were individually interviewed from both within RPAM and client departments to gain insight as to where some of the inefficiencies may be gained within the RPAM branch.
As identified in the original report, a key component to the BPRP is a strong external challenge role, to ensure that the review has been comprehensive and to draw upon their knowledge and experience in developing new and innovative ways to deliver service.
These industry experts review the findings of the project team and are asked to question and challenge the way in which each branch provides their services. The external challenge role draws upon professionals who are knowledgeable in the specific areas or services being reviewed so they will be unique to each branch review.
The expert brings objectivity and credibility in validating the project teams findings. In addition, provides information from the industry that will allow the project team to explore further opportunities for realizing effectiveness and efficiencies. The expert also permits the project team to use the credentials of the participant's organization when reflecting the findings of the review to Council.
The purpose of the challenge sessions for this review were to engage experts from the private and other public sector organizations specifically in similar areas managed by the RPAM branch of the City of Ottawa (i.e. strategic asset management, real estate management, design and construction, property maintenance, lifecycle renewal and corporate security) to provide an external challenge role to the branch's business process review initiative.
The project team conducted a number of challenge sessions throughout this review. The initial challenge session took place September 28, 2006. It was a one day facilitated event that covered a number of challenge topics. The following is a list of participants that attended the session:
Separate reviews took place with the following participants and covered a number of topics:
As well, a specialized challenge session was held for reviewing the security unit, as it is a very specialized area of expertise. The following participants were involved in the security challenge session:
The challenge sessions were an important part of the process and provided valuable insight into how other sectors in the industry conduct business.
Overall, the participants of the challenge sessions were impressed with the branch’s service delivery model and innovative initiatives as compared to external public and private industries. It was identified that RPAM is struggling in the same areas where most of the industry struggles. Finding comparators for benchmarking and performance measurement seems to be a common issue in the industry. As a result, many of the organizations only measure performance against themselves to determine their effectiveness and efficiency. Many of the participants also rely solely on client satisfaction surveys to determine effectiveness.
The organizations that participated also identified that there was not a one size fits all or any formula to determine the amount of resources required. Most organizations determine their resource requirements based on the type of facilities they operate and the finance resources allotted.
The overall conclusion that came out of the challenge sessions is that the RPAM branch incorporates many leading edge industry practices that contribute positively to how well RPAM runs its operations.
An internal Steering Committee was established to challenge the final recommendations and provide consultation advice. This committee was instrumental in providing direction to the project team and validating the recommendations. It was chaired by the Chief Corporate Services Officer and included the following membership:
A senior consultant from KPMG and the Program Manager from the Business Process Review Office also attended the meetings to provide advice on the process methodology.
A number of municipalities across Canada, the United States and private sector firms were asked to provide best practice material and performance measurements so that the project team could do comparative analysis for the reviews.
KPMG was involved with the RPAM project team throughout the pilot and provided training and advice on the overall application of the methodology throughout the project. They were also involved in reviewing the major output documents of the pilot to ensure that they were consistent with the expectations of the methodology.
There is no financial impact as a result of the approval of the six (6) new FTE’s. Funding will be transferred from the existing purchase service budget of the Real Property Asset Management Branch to cover off the increase in compensation.
The approval of the two (2) additional FTE’s within Corporate Security at a cost of $137 K will result in a decrease in the total efficiency savings from $1.065 M to $928 K. The net savings will be credited against the corporate efficiency target in the year they are achieved.
SUPPORTING DOCUMENTATION
Document 1 - Details of the Project Methodology
Document 2 - Summary of Findings, BPRP for Real Property Asset Management
Document 3 - Branch Process Review Program Report ACS2005-CMR-OCM-0015 (Approved by CSEDC November 1, 2005 and Council November 9, 2005 and held on file with the City Clerk).
Document 4 - Pilot Project - Business Process Review Program – Real Property Asset Management Report ACS2006-CRS-CSO-0004 (Approved by CSEDC July 4, 2006 and held on file with the City Clerk).
Document 5 - Branch Process Review Program Multi-Year Plan 2006-2012 ACS2006-CMR-OCM-0009 (Approved by CSEDC October 3, 2006 and Council on October 11, 2006 held on file with the City Clerk).
The RPAM branch Director and management team will implement the recommendations resulting from the process review as part of the 2007 and future work plans.
The BPRP Program Office will track and report on savings as they relate to corporate efficiency targets.
Document 1
Details of the Project Methodology
The
six phases of a typical business process re-engineering process and used by the
BPRP project team are as follows:
The first phase in any effective study process
is to establish a clear understanding of the direction the organization wishes
to move in. This involves developing a
“Case for Change”, a clear statement of the reasons change is needed that all
process participants can understand and relate to, and that will provide
guidance throughout the process. The
“Case for Change” must effectively communicate to the organization and key
stakeholders why the organization must change and why this process to discover
the degree of change is required.
The project management structure is also established
at this time. A work program or plan
for each study area will be developed providing a common base of understanding
for all participants at the beginning of the project. The work plan will identify the main tasks, the individual or
group responsible for their accomplishment and the timeframe. It will define the roles, responsibilities
and involvement of senior management, employees, and other stakeholders.
This phase involves performing “just enough” analysis
of the current operations to uncover the major problems and opportunities for
change, select “high-payback” areas or aspects of the organization upon which
performance improvement efforts should be concentrated; establishing a baseline
against which performance improvements will be measured; and sensitizing
management and staff to the scope and degree of changes being considered.
Using cross-functional design teams, develop a
creative/innovative portrait of how business will be conducted in the future,
including initial impacts on business processes, information technology,
facilities and equipment employed and human resources; establish estimates of
associated benefits and costs.
The objective of this phase is to develop a
portrait of how the organization will conduct business in the future. Design teams are chartered to develop the
processes, often expanding the core team as required to pursue the particular
opportunities identified. Alternative
approaches are investigated and analyzed, leading to selection of the
recommended approach for the future.
There are a number of approaches to the analysis, and the best approach
to follow will depend upon the service or function under review. It will often involve “best practice”
comparisons, looking at how other organizations carry out the function, and may
also include formal benchmarking to determine reasonable performance and
resource levels. It may include process
mapping and review to develop alternative “future states”. Financial analysis, market surveys (to
identify technology options and costs, alternative service delivery approaches,
etc.) and risk analysis can be important components. The result is a business case outlining the technology and human
resources that will be required to operate in the new approach, and the nature
and level of service that will be provided.
Gain a full understanding of the consequences
to the organization of implementing the preferred business solution (e.g. the
interrelated impacts of simultaneous changes to processes, human resources,
technology, policies, and facilities and/or equipment); refine the business
case; identify the major milestones for activities related to implementation.
Construct and test all elements of the
infrastructure required to support the business solution; draft support
documentation; validate key components of the IT system; modify/upgrade
physical facilities and equipment, establish programs to help deal with a broad
range of employee-oriented issues set in motion across the organization by the
full suite of process, technological and cultural changes that have been
designed and built; install equipment at local sites, conduct training and monitor
compliance to new processes and policies.
Put in place mechanisms to ensure that
performance improvements resulting from the transformation exercise are
sustained over time and ultimately lead to opportunities for additional
performance gains; establish continuous improvement as an integral part of the
organizational culture.
Document 2
Summary of findings, BPRP for Real Property Asset Management
|
Project Name: Service Requests RPAM |
|
Service Delivery: With the implementation of SAP, RPAM standardized
the tool used to capture all service requests and work management orders
across the organization. At that
time, the Real Property Asset Management branch also re-aligned the branch to
provide a centralized Service Desk to provide an administrative support
network to record, track and manage service requests for all program and
administrative facilities across the City. This ensures harmonization of the
management of service requests, work management processes and reporting for
much of RPAM. Several specific functional areas of RPAM have internal
processes to receive and track service requests given the focused nature of
requests and tight integration with program areas. After hour calls are captured by the City’s Call
Centre through 311. Requests are
input into a GIS based system (MAP), then relayed to the responsible on-site
supervisor through an interface to SAP. |
|
Issues and Observations: There are different processes being used for the intake of service requests during and after regular hours of work, but when recorded, they are all captured in one tool. The issue was raised to determine if there are any efficiencies to be gained by a single point of contact for all facility requests within RPAM or through expanded use of the 311 Call Centre. Service requests come through multiple entry points, and in some cases they are not being captured. In addition, RPAM does not have a standard protocol in place to notify the client once the service requests are complete. The process for receiving service requests was significantly streamlined following the implementation of SAP technology that allowed all work requests to be captured in one system. Requests for service are received either directly by a client within a facility (verbally or through direct input into SAP), by telephone, two-way radio or email throughout all areas of RPAM. For the most part, these requests are entered into SAP as a service request and responded to accordingly. The key principles endorsed during the implementation of the SAP
solution were as follows: ·
Eliminate
redundant and unnecessary process steps ·
Capture
information once for multiple purposes ·
Move data
capture to source to improve accuracy ·
Assign
accountability to the appropriate level and eliminate unnecessary control
functions Service requests are
tracked for the purposes of addressing any reoccurring issues that may have
an impact on budget and/or service delivery so that corrective measures can
be taken. While staff is aware of appropriate customer service protocols,
there does not appear to be specific procedures documented to ensure that
clients are consistently advised how they can follow up on a service request.
While RPAM has recently initiated a client feedback survey to one specific
client group, there is no standardized process in place to seek client
satisfaction feedback from all client groups. |
|
Key Recommendations: 1. Endorse future strategy that: the general public contact 311 as the single point of contact into the City of Ottawa; move SAP to web-based platform in 2007; encourage input of service requests directly into SAP by clients (internal and external) through web based on-line service request forms and; further endorsement/training to input requests for service at source with strategy to add hand held technology in the future to support mobile facility supervisors. 2. That operational management re-confirm service request categorization and advise staff to capture data consistently and that management implement standards and procedures to define what types of service requests must be captured and assess requirement for response time data with appropriate implementation plan. 3. Document a standard protocol to advise clients how they can get a status update for service requests. |
|
Benefits realized: Annual savings – None Effectiveness changes · Further to the significant
financial commitment to implement the SAP enterprise solution within RPAM,
supporting the migration of SAP to a web based solution and eventual
deployment of handheld technology for field supervisors, will allow the
branch to better achieve the key principles to eliminate redundant and unnecessary process steps as well as move data
capture to source to improve accuracy. · Review and implementation of
appropriate service request categorization and response standards as well as
a standard protocol for measuring client satisfaction will provide meaningful
performance metrics to continually improve service delivery in an efficient
and effective manner. |
|
Project Name:
Activity Tracking |
|
Service Delivery: Tracking work activities for RPAM programs and services provides management with the ability to identify the total cost of ownership and documents the completion of legislative work, preventive maintenance and service requests. Four hundred (400) full-time staff and 300-350 part-time operational staff in RPAM manually record the amount and nature of their work on paper-based activity sheets. On average, there are four activities recorded by each employee per day but there may be as many as ten activities. In 2006, between 75,000 and 95,000 activity sheets were ordered by RPAM. The activity sheet is reviewed and signed by the supervisor and faxed or mailed to data entry clerks (total of six FTE’s). This information is recorded and uploaded into the SAP PM module. For employees on positive time reporting, the data flows through to the HR SAP module for payroll purposes. |
|
Issues and Observations: The current process is time consuming for RPAM staff and management. There is a potential to add bar codes on the activity sheets and work orders and use scanner devices to enter data. This will provide faster and more accurate data entry by eliminating the need for keying in work order numbers, employee numbers or an activity. Bar code and scanner technology has been successfully implemented in other work units of the City of Ottawa. To achieve real cost savings and maximize the benefit of this technology implementation, a realistic approach would be to move as much data entry/scanning as possible from the current centralized model to all RPAM employees in the field. As well, moving to on-line approval of the activity and time information by the supervisors would create further benefits. This will enable the greatest reduction of the need for data entry. The implementation of a technology project of this scale will require significant involvement by a number of partners, particularly RPAM operational staff and management, ITS and Employee Services. The current version of SAP and configuration is not in place to support decentralized data entry of time information. While Employee Services’ service delivery model includes the roll-out of a number of SAP functions whereby employees will be able to input into and query the HR database themselves, producing a payroll based on employee entered time is complex and will only be undertaken following some successful implementation of other less complex employee self-serve projects. High level cost estimates for the
implementation of this project for hardware, software licenses and consulting
fees would be approximately $500 K with a return on investment of about two
and a half years. The risks of this project are the use of the
SAP employee self-serve functionality in the critical area of payroll; the
need to synchronize resources (staff and budgets) and planning with project
partners; and the training required to ensure staff and management
understanding and use of all the new data entry processes. With the planned system upgrades to SAP scheduled
for later this year, it is not possible to commence this project prior to
2008. Detailed business requirements,
planning, design and configuration would be started in 2008 with a proposed
implementation in 2009. |
|
Key Recommendation: The Business and Operational Services Division develop a detailed implementation plan with ITS and Employee Services in 2008 to use bar coding and employee self-serve time entry for the activity tracking sheets with the intent to decentralize data entry and eliminate a minimum of four data clerks and to identify the implementation costs of the project. |
|
Benefits realized: Annual savings – approximately $200 K Effectiveness Changes
Bar coding eliminates hand-off of work;
minimizes potential for data input errors; eliminates the need to purchase,
move and archive paper-based records throughout the corporation; and allows
administrative staff to focus on value-added work. |
|
Project Name: Contracted Goods & Services
Review |
|
Service Delivery: The Real Property Asset Management (RPAM) branch’s
Program and Venture Properties use the same contracts to secure goods and
services. Technical services are
consolidated under Venture Properties into one unit within RPAM. A Coordinator of Technical Services
Agreements, within that group, reviews the contracts rigorously to ensure
that service standards, response times and specifications are in alignment
with business requirements. There is one point of contact within Supply Management to make certain that goods and services are secured in the most effective and efficient way possible i.e. through standing offers. For both higher price jobs and for work that is not deemed to be an emergency over $10 K, there is a requirement to solicit three formal quotes by contracting companies. |
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Issues and Observations: RPAM has 34 goods, goods and services, and
services contracts that may have specifications that exceed the base
standards required by the operating areas. The
BPRP team has completed a review to assess whether the specifications within
the contracts are excessive and if savings could be achieved by amending
them. Results
indicate that contracts
are negotiated within the parameters of current market conditions, municipal
business practices and budgetary requirements and that they more than meet
the balance between value and dollar.
Contract specifications and
service standards are in accordance with existing legislative and business
requirements. Negotiated prices
within the contracts are also in accordance with the nationally recognized
price-monitoring indexes, so there is limited flexibility to reduce the
amount paid out for contracted services.
Specifications do not exceed those required and
the organizational structure has the appropriate control mechanisms in place
to ensure that the technical specifications are not excessive. In addition,
the contracts are monitored regularly for quality assurance and continuous
improvement. Industry experts have confirmed that the City’s contracts are technically well written and meet industry standards. Internal service standards between the Program Properties & Venture Properties divisions are not at variance to one another. Feedback from other Cities also indicates that service standards are not excessive. |
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Key Recommendation: Continue to evaluate the business
requirements (i.e. preventative maintenance and manufacturer’s suggested
warranty schedules) and monitor contracts upon renewal to ensure a
competitive process and that value for money is achieved. |
|
Benefits realized: Effectiveness changes: Already realized |
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Project Name:
Accommodation Process Review |
|
Service Delivery: There
is currently one staff person in the Real Property Asset Management branch
coordinating approximately 2,800 small moves per year, with assistance from a
Computer Automated Drafting Design (CADD) resource person and an
administrative resource person who also support large move projects. In 2005, four project staff managed 65
large moves for the entire corporation. Each move involves defining client
needs, space planning and design, contract management, construction
implementation and coordination of the move process. Small moves occur when fewer than seven
staff relocate. Large moves occur when more than seven staff are relocated to
new space or space requiring significant fit-up. Small move projects generally require an average of 30 minutes
per staff person and are implemented with combined resources from RPAM and
ITS. To keep costs down, external
contractors are rarely used. |
|
Issues and Observations: There
are inconsistent administrative space standards between administrative
buildings and programming facilities with administrative space and there
appears to be an excessive number of internal moves with too many resources
supporting the move process. In addition, the role and need for the
Departmental Accommodation Representatives is unclear, the Accommodations
Request Form (ARF) is cumbersome and time-consuming, and moves often take
longer than the 10-day industry standard. The
City’s space standards are very aggressive in comparison with the industry
standard. There are currently inequities in the size and type of office space
provided to similar type positions depending on whether the space is located
in an administrative facility or a program facility. Given
the current corporate requirement for moves, the level of staffing that is in
place is appropriate. The role of the Departmental Accommodation
Representatives remains as relevant today as it was during the Corporate
Accommodations Master Plan (CAMP) initiative, as a single point of contact to
ensure consistency and fairness in the allocation of space and to address any
disputes that arise within and between departments. There
is currently no space management tool to capture data, update floor plans and
produce any value-added performance reporting. Significant manual inspections must be performed to confirm
existing vacant space and office layouts.
While minor adjustments can be made to the ARF form, until it is
integrated with a space management database, the move process is as efficient
as it can be with the current tools available. |
|
Key Recommendations: 1.
Approve
the current administrative space standards and design guidelines for all City
facilities. 2. Keep the resource levels supporting
the move process within RPAM at the current level. 3.
Maintain
the current move services. 4.
Endorse the business case for an accommodations
management database in 2007 and once implemented confirm the further business
case for a space management software solution and budget in 2008 to further
strategic space planning within the City. |
|
Benefits realized: Annual savings – None Effectiveness changes – Once fully implemented, a fully
integrated space management solution will benefit both RPAM and ITS with a more
effective process in support of space planning and accommodations management.
This will also allow the Design and Construction division to better take on
necessary strategic planning efforts to ensure the use of space is
effectively maximized and utililized. |
|
Project Name:
Assessment of Using In-House
Trades versus Contracting-Out |
|
Service Delivery: The Real Property Asset Management branch uses a combination of internal (47 per cent) and external (53 per cent) trade services to provide all aspects of repairs and scheduled work. The City purchases trades in areas where it is more economically feasible to contract-out, when the City has a shortage in an area that is critical to facility maintenance, where specialized equipment is required or to meet seasonal or peak demands. The internal group is always resourced at full capacity to ensure best value for money. In-house trades with the most essential core skills are also employed to ensure that the City can respond to any emergency situation as well as to ensure that there is a continuity of expert knowledge of the many specialized City facilities. This is also valuable for reviewing the workmanship and cost of services provided by external suppliers to confirm that the City is getting best value for money. Standing offers based on a competitive bid
process are used to contract-out trades when there is an in-house
shortage. A full-time staff person
develops the specifications for these standing offers. This has streamlined
all tenders and created a centralized source of purchasing services and
materials to standardize levels of service. |
|
Issues and Observations: RPAM management have raised the issue that contracting out trade assignments may be more expensive than providing the service in-house and that the City does not have the right complement of in-house trade staff most critical to facility operations especially when required to respond to emergency situations. The City pays a premium on trades where there is a shortage in the market place. Staff have been regularly evaluating the mix of in-house trades, and making adjustments to the complement as positions become available. However based on the volume of regular work, it is estimated that there is still a shortage of four in-house trades (in the areas of Electricians, Gas Fitters / Refrigeration Technicians (HVAC) and Plumbers). By staffing up in these areas there are both financial efficiencies and changes in effectiveness to be gained. A detailed business case demonstrates that
cost savings are possible by establishing four additional FTE’s to support
the area of heating and ventilation trades and electricians with a
corresponding reduction in the amount of work completed by external
contractors. Using conservative
figures, there is a net benefit to the City of about $40 K per year
per in-house trade based on a full cost of ownership business case taking
into consideration the capital outlay for a one-ton van, protective screen,
shelving, and initial tooling. The payback on the capital investment is less
than one year (.83). The business case also took into consideration the
premium paid on materials when using private sector trades versus purchasing
the materials from the City’s standing offers. The
cost of an internal trade position is about $129 K, which includes $63 K for
salary and benefits and $66 K for materials and operating costs for a
vehicle. With a cost of $168 K for a
comparable amount of work performed by an external contractor, the establishment
of one FTE with associated costs will eliminate approximately $40 K of
external costs per trade, with a total of $160 K in savings for four FTE’s. |
|
Key Recommendations: 1.
Increase
the Gas Fitters/Air
Conditioning (HVAC) Technicians and the Electrical trade staff by two each,
bringing the in-house complement up by four. |
|
Benefits Realized: Annual Savings - The full cost of ownership business case has indicated a conservative yearly benefit of $40 K per in-house trade position bringing the total to $160 K. Effectiveness changes - Increasing in-house trade
specialties will ensure: that the City is prepared to respond appropriately
to emergency situations and emergency work requirements, that the City has
the in-house knowledge to maintain and understand the intricacies of City
facilities, that the City is not vulnerable to marketplace conditions where
supply and demand is an issue, better quality assurance on the work being
completed and an enhanced audit function. |
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Project Name:
|
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Service Delivery: At
present, Real Estate Services has a mix of internal staff (two FTE’s) and
external appraisers providing property valuations for the disposal of surplus City owned
property, to assist with property acquisitions required to deliver programs
and infrastructure, for strategic budget forecasting (i.e. acquisition of
environmental land), and valuations for cash-in-lieu of parking and for
parkland dedication. Over the last
four years, internal resources have carried out about 30 per cent of the 187
appraisals completed per year. As
well as doing the appraisals, a considerable amount of internal staff time
(45 per cent) is devoted to project managing the external appraisal files
meaning less time can be spent on actual appraisal reports. Based on the status quo, it is estimated
that over $425 K would be spent on external contracts to obtain 115 appraisal
reports of the 170 forecasted valuations in the 2007 workplan. In response to the 2005 audit
findings of the City’s Office of the Auditor General, RESD management agreed
it was important to determine how the services provided by the division would
be delivered in the future by using a combination of both internal and
external resources. |
|
Issues and observations: The Division believes that savings can be
achieved by changing the mix of resources for property appraisals. They have completed a detailed business
case that supports the establishment of an additional FTE to provide
appraisals while retaining external contracts for work that is complex in
nature or controversial. The result
would be that about 70 per cent of all forecasted appraisals can be done
using internal resources and save $93 K annually. The cost of establishing an FTE including
salary, benefits, mileage, parking, etc. is $91 K and that position can eliminate
$93 K worth of external appraisal fees from the purchase of service budget in
Real Estate Services. |
|
Key Recommendation: Establish an additional Real Estate Officer
position (one FTE) in RESD (and transfer appropriate funding from purchase of
service budgets) for appraisal services and reduce the number of files sent
externally. |
|
Benefits realized: Annual savings - $93 K Effectiveness changes · Improved centre of expertise within RPAM with the addition of staff performing market research and valuation reports. · Improve skills of staff with more hands-on appraisal work. · Offer quicker response time for clients. · Improve database for sales information. · Reduced cost of appraisals to purchasers of corporate property. · Diminish exposure to the rising costs of external appraisal reports. |
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Project Name:
In-Sourcing Environmental Remediation Services |
|
Service Delivery: The current environmental remediation unit within Real Estate Services Division (RESD) consists of 2.5 FTE’s. The program is in response to legislative requirements, risks and liabilities associated with environmental issues that affect public health and the environment such as ongoing groundwater monitoring, environmental remediation programs such as pump and treat systems, and investigations of city-owned rights-of-way to ensure there are no impacts from adjacent properties and due diligence site assessments in support of the acquisition and disposal of property. Funding for the environmental remediation program is through both the operating and capital budgets. For the past two years the operating budget has been approximately $1.6 M annually with an annual capital budget of approximately $2.6 M. In response to the findings of the City’s Office of the Auditor General audit in 2005, RESD management agreed it was important to determine how the services provided by the division would be delivered in the future by using a combination of both internal and external organizational structure. |
|
Issues and Observations: A detailed business case demonstrates that
cost savings are possible by establishing an additional FTE to support the
environmental remediation program and reduce the amount of work completed by
external contractors. For comparison
purposes, the average cost of an Intermediate Engineer from a consulting firm
will be $110 an hour, while the hourly cost of an internal resource inclusive
of all costs would be $54 an hour.
Significant savings can be also realized in the administration and
supervisory costs charged by the external consultants. The cost of establishing an FTE
including salary, benefits, mileage, parking, etc. is $97.5 K and that
position can eliminate $213.8 K worth of external consulting fees. The annual sustainable savings would be
$116.3 K. |
|
Key Recommendation: Support the establishment of an additional
Environmental Remediation Specialist (one FTE) in RESD to reduce the costs
externally. |
|
Benefits realized: Annual savings – $116.3 K
Effectiveness
changes
· Effectively communicate to environmental consultants and question/comment/challenge consultant’s engineering work and ultimately limit the City’s liability and reduce costs · Effectively oversee environmental projects from beginning to end and reduce/prevent delays · Enhance the quality of work provided by environmental consultants to the City. |
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Project Name:
Inquiry Tracking - Real Estate Services |
|
Service Delivery: The Real Estate Services Division has
implemented the Request for Service (RFS) tracking system, a standardized
system for tracking inquiries. The Administrative Clerk in the division
receives inquiries from the Call Centre, the Client Service Centre, or
Councillors’ offices. They are then sent to the appropriate staff person for
response. Some inquiries are sent
directly to Real Estate Officers in the division, and as a result are not
tracked. The RFS system is currently not capable of sorting electronically to
indicate the origin of the inquiry. |
|
Issues and Observations: The Real Estate Services division receives a
high volume of inquiries that are questionable in nature, causing concern
that the Call Centre is sending them to the wrong division. This creates a
workload issue as staff are responding to inquiries that are not within their
jurisdiction to prevent clients from being bounced all over the
organization. The division has
completed a review of the current processes and tools for tracking inquiries
to ensure that they get sent to the right areas. The total number of inquiries received from
January to July 2006 was 304. This is an average of 43 a month or less than
two inquiries a day. Approximately 26
of the total inquiries were associated with the corporate portfolio (mainly
related to grass cutting) and 21 of these inquiries were routed to the Real
Estate Services Division in error. In addition, the Administrative Clerk in
this division receives a number of duplicate inquiries. |
|
Key Recommendations: 1.
Have
one person within the Real Estate Division receive, review and log all
inquires prior to sending them to staff within the Division for response to
ensure that all inquiries are logged. 2.
Send
inquiries that are not the jurisdiction of the Real Estate Services division
back to the Call Centre for action. 3.
Train
Call Centre agents how to route inquiries and determine whether the issue is within
the jurisdiction of the City or if it is a by-law inquiry. 4.
Review
the RFS system to see if there is an ability to file based on the origin of
the calls (i.e. from Councillors or the Call Centre). 5.
Provide
the Call Centre with a staff list to assist with the correct routing of
calls. |
|
Benefits realized: Annual savings – None Effectiveness changes – Inquiries will be routed
appropriately resolving the workload issue, as staff time will not be spent
on inappropriate inquiries. |
|
Project Name:
|
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Service Delivery: Corporate Security is responsible for ensuring the physical security of all persons and assets within city facilities. This is defined as implementing measures to prevent loss or damage to persons/facilities to limit the impact of loss when it does occur and assist persons and operations with recovery after an incident. Since the inception in the new city, there
has been a significant increase in the services and activities provided by
Corporate Security staff (there are more than 300 intrusion alarms in city
facilities versus 10 in 2001; 112 facilities have building access controlled
through the ISMS versus 33 in 2001; and there are now 75 facilities with CCTV
versus 1 in 2001). |
|
Issues and Observations: Concerns were identified during the opportunity phase about Corporate Security not having enough resources to respond to the security needs of the organization. It was determined that a full review of Corporate Security be undertaken to determine the extent of under-resourcing, while at the same time, look at key processes for efficiencies. The areas of review were: 1. Security guard services for non-regularly scheduled events; 2. Responsiveness to clients’ security needs; 3. Staffing resources in Corporate Security; and 4.
Incident
reporting – processes and technology. |
|
Key Recommendations: Security guard services 1.
Corporate
Security partner with Supply Management to establish an RFP of acquiring
security guards to meet client requirements, such that all requests for
security guards be through Corporate Security. 2.
Corporate
Security to communicate the revised process for obtaining security guards to
all clients and post the requirements on the Intranet. Responsiveness
to clients
3.
The
Manager of Corporate Security establish meeting schedules with the management
team of key clients to discuss issues of mutual concern with respect to
security. 4.
Corporate
Security provide up-to-date process charts and defined service standards to
clients for all services provided by the division. Use the intranet to post and regularly communicate updates of
service delivery information to clients. Staffing
resource levels
5.
Corporate
Security adopt a structured reporting practice which collects, analyzes and
reports on a regular basis the actual performance of the work of the division
with respect to service requests, investigations and all other security
initiatives as compared to the planned service standards for delivery of the
services. These reports will be
useful for clients and branch management to identify the effectiveness and
efficiency of the division’s security operation, quality and level of service
delivery. 6. Create two additional FTE’s to supplement the existing resources of the division to adequately meet the service requests of clients. One of the FTE’s should be an entry-level position responsible for non-operational security matters. The other position required is a Security Advisor to provide tactical response. Based on the mid-range values, the estimated annual cost of these positions is $137 K. Incident
reporting
7.
Corporate
Security Management and Risk Management staff meet to establish a work flow
process for the incident reports that meets the needs of both work groups. 8.
Corporate
Security partner with the other potential users of an incident reporting
software and ITS to determine and implement the most cost beneficial and
user-friendly solution to meet the needs of all partners. |
|
Benefits realized: Annual savings - None Effectiveness changes
Security
guard services · Processing all requests for
security guard services through Corporate Security will increase quality
control on the guards hired (licences can be verified, unsatisfactory guards
will not be re-hired, the number of guards hired will match the security and
risk requirements), assurance that security requirements and processes have
been explained, the rates paid for guard services will be clearly
established. Responsiveness to the security needs
· Meeting with clients on a regular
basis provides an opportunity to exchange issues and concerns on service
delivery. · Documenting, reviewing and
communicating the services provided by the division and the standards with
which the division will deliver those services, will provide clarity to
clients on the responsibilities of Corporate Security. ·
Regular reporting will demonstrate the degree of success in meeting the
defined service standards and provide management with the opportunity to
identify potential changes required in service delivery to improve service to
the client where required.
Staffing resource levels
· Establishing a position providing
operational support to the Security Advisors and other division staff will
allow management the ability to assign responsibilities to the appropriate
position - experienced Security Advisors will be able to devote more time to
security operations. · An additional Security Advisor
will supplement the existing resources to be better able to meet client
requirements. · Reducing the amount of time per
day security staff are devoting to their tasks will lessen the potential for
staff turnover as well as health and safety problems. · Tracking the time that security
staff spend on their projects will provide management with better information
to effectively manage resources in the division. Incident reporting
· In the short-term, Corporate
Security will be provided access to incident forms when they are required. · Potential implementation of a
single software solution, which meets the needs of multiple and similar
business lines. |
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Project Name:
Security Integrated Security Management System (ISMS) |
|
Service Delivery: Corporate Security is responsible for the
integrated security management system that provides electronic security and
access control at the city’s administrative, program (such as community
centres and homes for the aged) and operational facilities (such as water
purification and waste water treatment facilities). There are approximately 13,500 components of
the system installed in about 300 city facilities. The system consists of hardware (proximity readers, locking
devices, duress and intrusion alarms, request to exit units, closed circuit
television cameras, video monitors, digital video recorders, proactive
audio/video systems and intercoms) connected to a server and software
(Pegasys P2000). The ISMS is viewed by security experts as
leading edge and Corporate Security has been recognized nationally and
internationally for the integrated system implementation throughout city
facilities. |
|
Issues and Observations: The capital and operating expenses associated
with the ISMS is the largest budgetary expenditure of the division – over
$2.5 M in 2005 as compared to salaries and benefits of just more than $463
K. Given that the ISMS represents
such a significant portion of the security budget, the BPRP team reviewed the
processes and costs associated with this system, particularly in the
following areas: 1.
Service
maintenance agreement – The cost of the agreement in 2006 is over $560
K. Costs will increase during
start-up but then level off. The agreement provides for a preventative
maintenance schedule (inspect and maintain) and sets standards for repairs
and replacement of any defective equipment based on the type of
facility. There may be merit in
considering a more cost-effective agreement based on a break-fix approach. 2.
Inventory
of security components in SAP – an opportunity exists to consolidate
information on security hardware in one secure database (SAP) instead of
maintaining two separate databases used for property management purposes 3.
Service
requests – Separate systems are used for tracking security-related service
requests versus other property management-related calls. An opportunity exists to consolidate
information on security service requests in one database (SAP) instead of
maintaining two separate databases. |
|
Key Recommendations: 1. That the budget for the service maintenance agreement for the ISMS be reduced in 2009 by $100 K. 2. Establish a review cycle on a regular and on-going basis to evaluate and document that value-for-money is being achieved with the ISMS and ensure that processes are optimal and costs are minimized where possible. The review should specifically focus on, but not be limited to the following: a. whether there are opportunities to modify the service response standards in the agreement for different types of facilities (administrative buildings versus facilities providing frontline services to the public) or for different types of equipment (proximity readers versus CCTV) while minimizing the impact or risk to clients and if so, a recommended plan for action; b. whether preventative maintenance can be reduced for security features that have a high degree of operational reliability and if so, prepare a recommended plan for action; c. identifying the security features that have the highest incidence of failure and where having coverage of that equipment under a service maintenance agreement is cost beneficial and meets client requirements; and d. whether sustainable cost savings may be realized by procuring and obtaining servicing for the existing and new security infrastructure by alternate methods. 3. Corporate Security partner with Business and Operational Services division to develop an action plan to implement to expand the facility information database in SAP to include security components at a level that does not compromise the security of staff or assets. 4.
Corporate Security in consultation with Business and
Operational Services develop an action plan to capture all service requests
for repairs to security hardware in SAP through to the SOC for appropriate
response. |
|
Benefits realized: Annual savings
-
· $100 K in 2009 · Further savings may be possible following the full review in 2008 Effectiveness
changes -
· Inclusion of service requests in
SAP will provide for management reporting on equipment failures and support
strategic decision-making; · Service requests in SAP will
consolidate facility information in one database and provide a more accurate
total costing of ownership of corporate assets; and · Appropriate alignment of staff
responsibilities. |
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Project Name:
Fire Alarm Monitoring |
|
Service Delivery: Of
the 79 fire alarm panels in corporate facilities, private companies are
monitoring 61. Corporate Security
identified that capacity exists in the Security Operation Centre (SOC) to do
the monitoring in-house. |
|
Issues and Observations: Average cost of obtaining the monitoring
services from external companies is about $46 K annually. High-level cost estimates of fitting up
the SOC to meet regulatory requirements to do the monitoring would cost an
estimated $35 K. The return on
investment to make the physical changes in the SOC ($15 K) and the new
equipment and modifications required to change the dialing mechanisms ($20 K)
is excellent with a pay-back of about nine months. The ability to achieve the efficiency is
dependent on receiving capital funding to relocate the SOC to the P2 level of
110 Laurier. The in-house monitoring
of the fire panels is not possible within the current location of the SOC
given the space, mechanical systems and layout. The relocation of the SOC is not dependent on centralizing the
fire alarm monitoring. |
|
Key Recommendation: Consolidate all fire alarm panel monitoring
in the Security Operation Centre. |
|
Benefits realized: Annual savings – $46 K |
|
Project Name:
Lease Management |
|
Service Delivery: Real Estate Services is responsible to negotiate with perspective leaseholders of city-owned land. Once a lease is set, all management of the lease payments (invoicing, collection, recording of payments and collection of delinquent payments) is the responsibility of Accounts Receivable in Corporate Finance. |
|
Issues and Observations: Real Estate staff questioned whether savings could be realized by not printing and mailing invoices to tenants of city property and wanted to clarify the process for applying payments to accounts in the event of rent arrears. With respect to sending invoices, there are no efficiencies to be gained by not producing an invoice. The top portion of the invoice contains a line of optical character recognition with customer information such as account number, and billing amount, etc. Having this portion of the invoice along with the payment speeds up payment processing by Cash Operations staff since they can reduce data entry requirements. Payments returned with no invoice increase data entry requirement. On the matter of applying payments to rent
arrears, Accounts Receivable staff are well versed in dealing with account
holder inquiries on arrears and account information and they should answer
questions from account holders on arrears. During the review questions were raised as to
the most efficient location for lease payments to be made and types of
payment methods. The recommendations
below reflect the decisions on these issues. |
|
Key Recommendations: 1.
No
change in the process for printing of invoices for leaseholders. 2.
Real
Estate staff to write the leaseholders to advise of the correct location for
making payments (Accounts Receivable) in the event that lease payments are
sent to RPAM. 3.
As
leases come up for renewal, the new agreements or supporting documentation
should clearly state the correct location for lease payments and explain the
various payment options that are now available. |
|
Benefits realized: Annual savings
– None
Effectiveness
changes -
· Lease payments routed to the
correct work location for processing · Clarifications on roles and
responsibilities for addressing lessee questions on account arrears · Harmonization of interest rate
penalties on all corporate leases · Decreased processing time when
invoices are returned with payment. |
|
Project Name:
Revenue Leases |
|
Service Delivery: Properties
owned by the City and not being used by the programming department for whom
the property was acquired are leased out to generate revenue. In 2006 about $4.29 M was generated
through approximately 324 leases, hence the term “revenue leases”. |
|
Issues and Observations: During the interview process with management
and staff, the BPRP project team was advised that some leases have reached
the end of their terms and were on a
month-to-month lease basis. The result is that the lease rates may not be
reflective of the current market conditions and there may be an opportunity
for more revenue if the leases are renegotiated. A comment was also made that the
terms of some of the leases require the leaseholders to pay additional costs
for utilities or parking, etc. These extra costs are not always invoiced and
the City may be is losing out on some revenue sources. A review of a sample of leases
showed that approximately 13.5 per cent of leases were on a month-to-month
basis. The Program Manager has added
the updating and negotiation of all leases to the division annual workplan so
that leases are negotiated in a timely manner prioritizing leases with the
greatest revenue potential. With respect to invoicing for costs that are
the responsibility of leaseholders, a review of leases and the process for
the cost recovery invoicing process was completed. This review showed that there were only isolated incidents and
that there was not a systemic problem and no revision to the process was
warranted. During this review, the Program Manager and
staff identified that there has been no standard format for revenue
leases. A new lease agreement was
prepared for lease renewals. They
noted that efficiencies would be realized if the Real Estate Officers were
working from a standard template for a lease. Not only would less time be required for preparation of a
lease, but also the template would ensure that standardized lease terms and
practices would be implemented. The
Appraisals and Corporate Portfolio Unit worked with Legal Services to draft a
standard lease template and now a corporate standard for preparing new leases
is used. |
|
Recommendation: No action required |
|
Benefits realized: Annual savings – any
additional revenue generated from invoicing costs to lessees and
renegotiating leases will be reflected in future operating budgets.
Effectiveness changes – Approximately 80 per
cent of lease contracts are renewed after expiry. It is anticipated that with
the new standard lease document there will be an increase in
staff time when using the new lease format as old expired leases are rolled
over to the new format, but will reduce staff time for subsequent renewals. |
|
Project Name:
Organizational Review - Real
Property Asset Management |
|
Service Delivery: The Real Property Asset Management branch uses a centralized landlord service delivery model allowing for: efficient inventory control, full integration and consistent delivery of real property services across all properties, a coordinated approach to asset rationalization, and the ability to manage each facility throughout its entire life cycle. RPAM provides turn-key property management and professional services through the following divisions: · Comprehensive Asset Management: Asset Rationalization; Life Cycle Renewal & Accessibility; · Real Estate Services: Acquisition, Disposal, Lease Management, Environmental Remediation & Corporate Real Estate Development projects; · Design and Construction: Buildings/Parks, Accommodation & Energy Management; · Venture Properties: Property Management (portfolio based) specific to Utilities, Transit, Administrative facilities and Property Management and Programming at Lansdowne Park and public markets to ensure legislative compliance, operational, technical and maintenance support; · Program Properties: Property Management (geographically based for all municipal program facilities) to ensure legislative compliance, operational, technical and maintenance support; · Corporate
Security: Asset and Staff Protection; and · Business
and Operational Services: Branch Business Planning, Management of
continuous improvement of Enterprise Solutions, Performance Measurement and
Branch-wide and Corporate projects. |
|
Issues and Observations: A
review of the Real Property Asset Management (RPAM) branch was conducted to
review the mandate and service delivery model of RPAM and current branch
organization structure in adherence to: · Organization design guidelines to verify span of control/chain of command issues · The collective agreement to assess conformity of hours of work to meet RPAM business requirements (ES) · Staffing strategies with regard to the number of vacancies and how they are managed in consideration of corporate gapping and business requirements · The job evaluation plans and the number of job descriptions that are out of date, which may reflect inappropriate ratings, what the current status is around job evaluation activity · The job credentials and the requirement for education, experience and accreditation (specifically in D&C and CAM) and if there are any opportunities to improve service delivery and reduce costs to the organization based on any reviews. RPAM maintains and manages all
real property related to the programs of all city departments based on the
concept of a “Corporate Landlord”, holding all program property and providing
turnkey property management and professional services to program occupants of
the real property assets required for their respective programming
areas. It is responsible for
providing professional management and care of the City of Ottawa’s properties
and buildings, ensuring program operators have the appropriate facilities and
property in a secure environment to support their program activities while
ensuring the minimum cost to taxpayers. This model has allowed the branch to:
harmonize service levels to a sustainable level; create a flexible
organization through uniform human resource standards; adopt SAP applications
for full cost of ownership and performance reporting; report on full scope of
asset inventory and condition; and embrace
financial accountability achieving and sustaining a balanced budget in
2004-2005 and again in 2006. RPAM has been very
proactive since amalgamation in harmonizing jobs and aligning the
organization to the multiple human resource guidelines that are in
place. When considering the 80/20
rule, RPAM can be considered as compliant to the guidelines provided by
Employee Services and as proactive in streamlining jobs and pursuing
organizational efficiencies as opportunities permit. The project team also
interviewed major client groups to seek feedback and recommendations on
service delivery levels/mandate, roles and responsibilities, etc. Client groups did not believe any changes
in RPAM’s mandate were required, but rather strengthened lines of
communication with a better understanding of client influence on service
levels. Since amalgamation, RPAM has responded to: ·
Several
significant audit reviews ·
An
alternative service delivery review, evaluating RPAM efficiency
levels in comparison to other municipalities, the federal government (PWSGS)
and the private sector, and ·
A pilot for
the Branch Process Review Program, significant process review while having to
respond to multiple ongoing budget reduction exercises. As
a result of the recommendations identified in the Alternative Service
Delivery (ASD) review, the mandate and existing service delivery model has
been recognized as fairly unique among the municipal environment, adopting a
centralized landlord model; allowing for efficient inventory control, full
integration and consistent delivery of real property services across all
properties, a coordinated approach to asset rationalization, and the ability
to manage each facility throughout its entire life cycle (from the time the
project is conceived through to its disposition). Further to the ASD
analysis, Ottawa is leading municipal practice in the areas of strategic
portfolio management and life cycle planning, its investment in technology
with a strong ability to monitor and track full cost of ownership to the
facility level for all City owned facilities. The branch has harmonized service contracts and continues to
balance internal and external resources through prudent contract management
to ensure best value for money. The
outcome of these various reviews continues to confirm the success of the
current RPAM mandate and service delivery model, and the effectiveness of the
strategic, financial and administrative framework supporting the various
program areas of the Corporation.
RPAM ensures a competitive management approach to ensure best value
for money in its approach to service delivery, in areas of contract
management, organizational design and strategic portfolio management within
the confines of the existing boundaries within a large public
organization. |
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Key Recommendations: 1.
Continue
to review job descriptions to consolidate and reduce the number of jobs and
update employee files as required to ensure qualifications are in order. 2.
Clarify
the Span of Control Chain of Command Guidelines to simplify interpretation
for the L6 and L7 levels for the various business areas. 3.
Provide
corporate direction on the appropriate approach to meet gapping provisions,
including the use of vacancies, to ensure positions are not held indefinitely
to meet requirements. |
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Benefits Realized: Annual savings – None Effectiveness changes
· Reduced administration as jobs are
harmonized; · Clarification and corporate
consistency in the application of span of control guidelines and, · Corporate consistency in how
gapping targets are met. |
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Project Name:
Project Management Review |
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Service Delivery: RPAM manages many different types of projects
as follows: · Comprehensive Asset Management
(CAM) manages asset rationalization, life cycle and accessibility projects. · Design and Construction (DC)
manages projects for renovations or new facility development, landscaping, accommodations
and energy management. · Real Estate Services (RES) manages
projects such as research and procurement, environmental remediation and land
development projects. · Corporate Security (CS) manages
threat and risk analyses and security-related infrastructure installation
projects. · Program Properties manages
projects for minor capital improvements, harmonization projects and projects
to improve service delivery with clients, staff training, etc. · Venture Properties manages capital
improvement projects, program initiatives at Lansdowne and the markets (e.g.
new market by-law). · Business and Operational Services (BOS) manages branch-wide administrative, harmonization, and specialized strategic projects for the branch. The RPAM branch uses an enterprise solution
incorporating three integrated modules of SAP to manage these projects. These include the Real Estate (RE) module
to track all City-owned and leased real estate inventory; the Plant
Maintenance (PM) module for work order management; and the Project Systems
(PS) module to track all capital project management activities in both Design
& Construction and Comprehensive Asset Management. |
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Issues and Observations: Lack of understanding and knowledge in
project management methodologies in some areas of the branch is resulting in
an inconsistent project management approach within RPAM as well as an
inconsistent understanding of project management practices and tools. This lack of knowledge has
resulted in unclear roles and responsibilities and delays in some project
deliverables. In addition to a standard methodology, RPAM
needs to endorse the use of PS for all capital projects to ensure full
financial data capture against all property assets and a smooth hand-off
between the various divisions of RPAM during the life cycle of these
projects. The implementation of the module in only two divisions of RPAM
provided the foundation for a project management tool with no specific
framework for a project management culture. Futhermore, there has been an inefficient use
of the SAP system to manage project data and scheduling in certain areas. The PS tool ensures that specific processes
are defined to ensure the scope of each project is identified, tasks are
outlined and schedules set. A significant benefit associated with the
decision to implement PS was the integration of the tool with the Plant
Maintenance (PM) module, which captures all facility related activities and
operating costs and the financial module of SAP for capital projects, which
provides one component of full cost of ownership reporting for all
facilities. The implementation of the PS module resulted in the confirmation
of the “five phase” methodology for all capital projects in Design and
Construction, through a work breakdown structure (WBS). In addition to a
standard methodology for all projects, RPAM should endorse the use of PS for
all capital projects to ensure full financial data capture against all
Corporate real estate and a smooth hand-off between the various divisions of
RPAM during the life cycle of these projects Currently most data captured is in-line with
proper project management processes but, with the exception of Design and
Construction, is inconsistently captured across the branch. While Microsoft
Project is the primary tool used by staff at the City of Ottawa, most staff
only use the tracking portion not the resources, budgeting and base lining
functionalities. . |
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Key Recommendations: 1. Adopt a consistent approach to project management and training consistent with corporate project management methodology and design a set of standard tools for all projects. 2. Officially adopt the “Five Phase” methodology for managing projects across the branch with coordinated training for specific target areas. 3. Build on the initial investment of the PS – SAP enterprise, continue to define and lead the initiative to rollout further use of the PS tool where appropriate. 4. Engage the SAP Support Centre to streamline data entry screens in PS. 5.
To increase staff efficiency in entering and managing
data in PS, pursue acquiring up-to-date MS Project licenses for limited areas
within the branch and provide appropriate training. |
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Benefits realized: Annual savings – None – may require additional SAP licenses to
be acquired at an amount of $5 K per license. Effectiveness changes: · Developing a project management
culture and a standardized environment will benefit the RPAM organization in
projects that require transition from one area of the branch to another over
the duration of the project. · Changes to the input screens will
reduce administration and benefit staff in managing their projects more
efficiently. · Acquisition of a few MS Project
licenses will allow more effective project scheduling graphics for client
meetings. |
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Project Name:
|
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Service Delivery: The Program Properties (PP) Division is
geographically structured and made up of four districts (east, west, central
and south) delivering property management services to a variety of program
facilities across the City. Each district allocates internal and external
housekeeping resources differently depending on the composition of the
portfolio. The cost for housekeeping services varies widely
by facility based on age, size, use, number of program hours and number of
months of operation. The east district has a higher use of internal labour
for housekeeping (vs. external) than do the central, south and west
districts. The lowest level of housekeeping complaints exist in the east
district where the service delivery model supports a higher level of internal
resources to deliver services. The Division has been harmonizing service levels
since amalgamation and is still making adjustments as a result of the
significant budget reductions that were made in 2004 during the Universal
Program Review. At that time, $2 M or 30 per cent of the existing
housekeeping budget was removed from the branch. Since these reductions were
made, there have been ongoing adjustments to service levels to meet client
requirements with a goal to determine the best service delivery model
(internal or external housekeeping service delivery) for specific types of
facilities under the existing budget constraints. |
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Issues and Observations: A
review completed by the BPRP team and RPAM management assessed whether there
is a higher standard of housekeeping services and more internal staff to
deliver these services in the east district than the other three districts
(central, west and south). Results indicate that service delivery mechanism has
a higher level of internal labour allocated to housekeeping in the east
district than the other areas, but do not confirm a higher standard of
housekeeping. Despite a slightly higher cost of housekeeping services in the
east and south districts, investigation has identified an administrative
problem in the manner in which staff charge their time to various activities
in these two districts, which resulted in inflated costing information. Once
the data is corrected, there is no specific indication that services
delivered in the east district are more expensive given the service delivery
model in place. As
a result of these reductions and ongoing “hot spots” in various public
facilities, there is currently a review underway, with representation from
both Program Properties and Parks and Recreation to review service levels and
the best service delivery model (internal or external housekeeping services)
for specific facility types. The
challenge session with public and private industry experts identified a variety
of opinions around the most appropriate balance between insourcing and
contracting out services.
Consideration of availability, reliability and cost of external
resources were identified in comparison to the need to balance core internal
services to minimize risk around availability, reliability and ultimately
client satisfaction of contracted resources.
With the increase in the number of complaints from clients in the area
of housekeeping, it is fair to assume that there is still a discrepancy between
housekeeping service delivery expectations from the client and current
service mechanisms (internal vs. external service delivery) and standards in
City facilities. |
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Key Recommendations: 1.
Review
the accuracy of internal labour charges and activity types across the various
types of facilities on an ongoing basis to ensure accuracy of data and
effective reporting. 2.
Review
service delivery mechanisms between internal and external resources on an
ongoing basis to define appropriate criteria by facility type and to enhance
the delivery of housekeeping services with client needs. |
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Benefits realized: Annual savings – None Effectiveness changes – Better data for performance
measurement; improved client satisfaction.
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Project Name:
|
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Service Delivery: Prior to amalgamation, there was a varied approach used by the former municipalities for cleaning rural fire stations (volunteer firefighter associations were paid a fixed amount for each station from operating budgets, volunteer firefighters were paid to clean the stations; and contractors were used to perform the cleaning on a regular basis). Following amalgamation, the rural volunteer firefighters have been cleaning the fire stations at an average honorarium of $12.64 per hour. |
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Issues and Observations: Fire Services indicated that
the current service delivery model for cleaning the rural fire stations is
not consistent with the COE model and there would be an efficiency gained by
moving the responsibilities over to RPAM. RPAM property management has estimated that the housekeeping in the rural stations would cost about $16 per hour for contract resources. RPAM program management also noted that it may be very difficult to get a company to provide cleaning service given the wide geographic locations of the stations and the fairly limited amount of cleaning that is required. Based on the estimates of the cleaning time required by RPAM to adequately meet the needs of the client, the anticipated cost of obtaining the cleaning contracts, the travel time of cleaning contractors and administrative costs associated with RPAM assuming the responsibilities for setting up and managing the cleaning contracts, it is cheaper to maintain the current service delivery by providing an average honorarium to the volunteer firefighters ($12.64 per hour) as compared to approximately $17.60 per hour for contract cleaning (includes the RPAM administration costs). |
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Key Recommendation: Firefighters continue to be responsible for
the cleaning of rural fire stations.
|
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Benefits realized: Annual savings
– None
|
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Project Name:
Utilities Procurement – Natural Gas |
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Service Delivery: The City purchases the majority
of its natural gas requirements as a member of a public sector consortium
known as the Ottawa Carleton Energy Procurement Group (OCEPG), which
has representation from the City, universities/colleges, school boards and several smaller
public organizations. The
Consortium purchases gas in blocks which may be short term, less than a year,
or as long as three years. Each block is purchased for a fixed price for a
specific amount of natural gas that is delivered on a daily basis. |
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Issues and Observations: Although the City has been a longstanding
member of the natural gas consortium, its purchase volume has allowed the
City to influence the purchase strategy for natural gas (compared to what it
would have cost to purchase directly from Enbridge), resulting in a more
favourable pricing structure attributed to the City. A review has been
completed to determine if
any permanent reductions can be made to the natural gas budget as a result of
the efficient buying practices of RPAM staff through the natural gas
consortium. Being part of the consortium provides opportunities to save money that would not be available if gas was purchased directly from Enbridge whose gas prices fluctuate to reflect actual costs, since by law, they cannot make or lose money on the cost of natural gas. The building block approach to purchasing provides price stability in the long term as well as a means to reduce costs. By buying in blocks when prices are favourable, the average cost of gas is reduced in the long term through fixed prices with built-in inflation savings. Current buying strategies have
resulted in locked-in pricing for 60 per cent of the future blocks of gas
required for the next one, two and three years. This price predictability and stability allows the City to
reduce budget amounts over the same period of time. For
the year 2006, the City of Ottawa, through the consortium, saved just under $700
K compared to
what it would have cost to purchase natural gas directly from Enbridge. In
the last four years, as a member of the consortium, the City of Ottawa has
saved over $2.3 M, an average of $575 K per year. As a reflection of this innovative and
efficient approach to buying natural gas, the average savings to the City of
Ottawa over the past four years indicate an ability to put forward a
reduction in the natural gas budget of $350 K at this time, with possible
additional savings in the future. |
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Key Recommendations: 1.
That
RPAM reduce its natural gas base budget by $350 K in 2007 in consideration of
effective purchasing practices over the past number of years. 2.
That
RPAM review natural gas procurement in 2008 to determine if any further
reductions to the base budget can be achieved. |
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Benefits realized: Annual savings · A reduction of $350 K from the
natural gas base budget · Possible further savings in 2008 Effectiveness
changes
· Already realized through enhanced
procurement process |