Project Charter

1

Project Title : Improvement of budget monitoring process of janitorial services, electrical equipment and electricty

Champion : Larry S. H. Sim

Team Leader : Rissa Samson

Asst. Team Leader: Renee Diminsil

Members : Alice Lim, France FelizardoContributing Members: Oscar Roman, Andy Sta. Ana

2

Project Charter

BUSINESS CASE:The building maintenance-related budget comprises to about 39% of total administrative expense budget of OAS. It is very important that these accounts are closely monitored and the budget monitoring system is efficient. An effective system may result to a more accurate data which will greatly help in the planning and optimization of use of budget.

An initial comparison of the actual expenses from the General Ledger of the Oracle System (Official Record) and the Utilization Report of the section show an average discrepancy of 18% in 2004 and 20% in 2005.

This project shall focus on budget monitoring process of the following administrative expense accounts: Electricity, Electrical Equipment and Janitorial Services.

DEFINEDEFINE

3

2005Actual Expenses of General Ledger vs.

Monitoring/Utilization Report

Oracle GL Utilization Report Discrepancies %Rental (Pres. Res.) 84,834 90,074 (5,240) (6.2)President's Residence-Main 47,035 38,313 8,722 18.5Bldg & Grnds Services 151,113 149,696 1,417 0.9Pest Control 26,459 21,188 5,271 19.9Janitorial Services 235,906 284,456 (48,550) (20.6)Garbage Collection 18,063 14,652 3,411 18.9Elevators 217,648 217,628 20 0.0Eng'g Oper & Maintenance 492,973 510,814 (17,841) (3.6)Electrical Supplies 85,774 73,242 12,532 14.6Mechanical Supplies 121,200 118,844 2,356 1.9Bldg & Grnds Supplies 183,873 144,926 38,947 21.2Janitorial Supplies 173,245 161,899 11,346 6.5Fire Protection Supplies 7,048 4,788 2,260 32.1Electrical Equipment 164,960 213,925 (48,965) (29.7)Mechanical Equipment 148,475 109,384 39,091 26.3Janitorial Equipment/Tools 14,792 15,943 (1,151) (7.8)Audio-Visual Equipment 15,298 15,298 0 0.0Fire Protection Equipment 3,180 0 3,180 100.0Medical Equipment 11,585 11,584 1 0.0Alterations & Improvement 405,987 364,537 41,450 10.2Electricity 2,232,990 1,874,279 358,711 16.1Water 83,915 76,910 7,005 8.3LPG and Others 53,949 54,096 (147) (0.3)Furnishings-Acquisition 7,020 3,065 3,955 56.3Furnishings-Maintenance 60,699 50,040 10,659 17.6Furniture-Maintenance 149,841 131,894 17,947 12.0Office Equipment-Maintenance 18,811 23,459 (4,648) (24.7)Radio Communications 17,308 14,948 2,360 13.6Other Outsourced Services 3,000 0 3,000 100.0

2005

4

Pareto Chart of Discrepancies 2005 Monitoring/Utilization

ReportCount

Perc

ent

2005 Admin Expense

Count 12532 11346 10659 8722 7005 5271 33146Percent 51 7

3587117 6 6 6 3 3 2 2 2 1

489651 1 5

Cum % 51 58 65 71 77 82

48550

85 87 89 91 92 94 95 95 100

41450 39091 38947 17947 17841

Other

Pest

Cont

rol 0

5

Water 0

5

Pres

ident'

s Res

.-Main

05

Furn

ishings

-Mai

ntena

nce 0

5

Janitor

ial Su

pplie

s 05

Electr

ical S

uppl

ies 05

Eng'g

Ope

r & M

ain 05

Furn

iture

-Mainte

nanc

e 05

Bldg &

Grn

ds Su

ppl ie

s 05

Mecha

nical Eq

uipmen

t 05

Al tera

tions

& Im

prve

mnt 05

Jani to

rial S

erv 0

5

Electr

ical E

quipmen

t 05

Electr

icity 0

5

700000

600000

500000

400000

300000

200000

100000

0

100

80

60

40

20

0

Oracle GL Actual Expenses vs. Budget Monitoring Sheet 2005

5

2004Actual Expenses of General Ledger vs.

Monitoring/Utilization Report

Oracle GL Utilization Report Discrepancies %

Rental (Pres. Res.) 95,872 95,872 0 0.0President's Residence-Main 9,699 12,296 (2,597) (26.8)Bldg & Grnds 125,377 127,160 (1,783) (1.4)Pest Control 24,661 19,963 4,698 19.1Janitorial Serv 273,848 273,522 326 0.1Garbage Collection 16,934 15,578 1,356 8.0Elevators 217,628 217,648 (20) (0.0)Eng'g Oper & Main 552,899 482,762 70,137 12.7Electrical Supplies 152,605 144,126 8,479 5.6Mechanical Supplies 100,035 132,784 (32,749) (32.7)Bldg & Grnds Supplies 148,448 119,093 29,355 19.8Janitorial Supplies 147,618 107,803 39,815 27.0Fire Protection Supplies 6,821 6,526 295 4.3Electrical Equipment 333,046 315,843 17,203 5.2Mechanical Equipment 116,387 165,364 (48,977) (42.1)Janitorial Equipment/Tools 22,160 18,558 3,602 16.3Audio-Visual Equipment 20,856 22,422 (1,566) (7.5)Fire Protection Equipment 10,348 9,532 816 7.9Medical Equipment 24,417 10,508 13,909 57.0Alterations & Improvement 286,460 378,305 (91,845) (32.1)Electricity 1,847,730 1,840,100 7,630 0.4Water 65,887 66,071 (184) (0.3)LPG and Others 38,383 42,007 (3,624) (9.4)Furnishings-Acquisition 16,691 16,253 438 2.6Furnishings-Maintenance 80,908 91,580 (10,672) (13.2)Furniture-Maintenance 53,465 92,532 (39,067) (73.1)Office Equipment-Maintenance 33,637 14,835 18,802 55.9Radio Communications 25,891 16,276 9,615 37.1

2004

6

Pareto Chart of Discrepancies of 2004 Monitoring/Utilization

ReportCount

Perc

ent

2004 Admin Expense

Count 17203 13909 10672 9615 8479 7630 21305Percent 20 15

9184511 9 9 7 6 4 4 3 2 2

701372 2 5

Cum % 20 35 46 55 63 70

48977

77 81 84 87 90 92 94 95 100

39815 39067 32749 29355 18802

500000

400000

300000

200000

100000

0

100

80

60

40

20

0

Oracle GL Actual Expenses vs. Budget Monitoring Sheet 2004

7

DEFINE

PROJECT DESCRIPTION:

PROBLEM STATEMENT : The internal budget monitoring report for building maintenance-related expenses does not tally with official accounting records and does not provide in a timely manner, how the budget allocation was used. As a result, the figures are not reliable for planning purposes and leads to customer dissatisfaction.

Project Charter

8

DEFINE

PROJECT DESCRIPTION:

PROJECT GOALS :

a. To analyze, evaluate and improve the current budget monitoring process for the following administrative expense accounts: electricity, electrical equipment and janitorial services.

b. To reduce the discrepancy between monitoring/utilization report and the general ledger of Oracle to $5,000 or less.

Project Charter

9

High Level Process Map

Prepares monthly budget utilization

report.

Updates monitoring worksheets.

Prepares monitoring worksheet for each budget account and

summary table.

Informs OAFA-FM staff handling budget accounts of the

approved budget.

START

END

Coordinates budget utilization updates with:a. RFP creator– for updates to Services worksheet from preparation/approval of RFP for services rendered for the month.b. RP creator/coordinator– for updates to Goods worksheet based on the month’s RPs/POs and deliveries.

Submits monthly utilization report to

Director, OAFA

10

CTQDEFINE

Output Unit Utilization Report

Output Characteristic

(Big Y)Reliable monthly utilization report

Operations Definition

Process starts when approved budget is disseminated to OAFA-FM staff and ends when monthly utilization report is submitted to Director, OAFA.

How process will be measured

By discrepancies from month end actual expenses of General Ledger of Oracle System against Monthly Utilization report.

LSL - US$0 discrepancyUSL - US$5,000 discrepancy

Defect Discrepancies above $5,000

No. of Defect Opportunities

Per Unit1 defect opportunity for each expense account

US$3,000 discrepancy

CTQ

Project Y (Little y) Measure

Specification Limits

Target

High-Level Need Improvement of budget monitoring process of

janitorial services, electrical equipment and

electricity

11

SIPOC DiagramDEFINEDEFINE

Suppliers Inputs Process Outputs Customers

Informs OAFA-FM staff of approved budget

Prepares monitoring worksheet

Updates monitoring worksheet

Prepares monthly

utilization report

Submits monthly

utilization report

OAFA-FM staff monitoring building and maintenance related goods and services

Actual expenses and commitments (outstanding RPs/POs) of building maintenance-related goods and services

High-Level Process Steps

(See Below)

Monitoring sheet/Monthly utilization report

Head, OAFA-FM

Director, OAFA

PD, OAS

Budget Coordinating Unit, OAOD

Step 1: Step 2: Step 3: Step 4: Step 5:

12

Summary of Discrepancies of 2005 for Janitorial Services

Janitorial Services

Oracle GL Utilization Report Discrepancies*

Jan (152) 0 (152)

Feb (152) 24,960 (25,112)

Mar 47,190 33,647 13,543

Apr 49,134 53,159 (4,025)

May 73,915 78,360 (4,445)

Jun 142,474 103,805 38,669

Jul 99,038 123,062 (24,024)

Aug 143,542 145,582 (2,040)

Sep 210,395 167,573 42,822

Oct 188,140 167,573 20,567

Nov 211,101 259,614 (48,513)

Dec 235,906 284,456 (48,550)

Note: Absolute values were considered in comparing the discrepancies.

MEASURE

13

Process Capability for Janitorial Services

MEASUREMEASUREMEASURE

6000040000200000-20000

LSLUSL

121110987654321

1000000

100000

10000

1000

100

10

1

Date:

Units:Upper Spec: 5000Lower Spec: 0Nominal: 3000 Opportunity:

7 March 2006Reported by:Project: OAS-06-012Department: OASProcess:Characteristic:

Actual (LT)

Process Performance Process Demographics

Actual (LT) Potential (ST)

Sigma(Z.Bench)

DPMO

-1.56

940429.6

-0.06

523281.1

Process Benchmarks

Report 1: Executive Summary: J anitorial Services

14

Process Capability for Janitorial Services

MEASUREMEASURE

121110987654321

80000

40000

0

_X=22705

UCL=73078

LCL=-27667

Observation121110987654321

50000

25000

0

__MR=18940

UCL=61882

LCL=0

ST

* -0.94Z.LSL * 1.21Z.Bench -0.06 -1.56Z.Shift 1.50

LT

1.50P.USL * 0.827092P.LSL * 0.113338P.Total 0.523281 0.940430

Mean

Yield 47.67 5.96DPMO 523281.1 940429.6Cp * *Cpk

3000

* *CCpk * *Pp * 0.04Ppk *

22705.2

-0.31

StDev * 18780.635Z.USL

50000 50000

79047.1-33636.7

I and MR Chart

Process Tolerance

Specifications

Potential (ST) Capability

Process Tolerance

Specifications

Actual (LT) Capability

Data Source:Time Span:Data Trace:

Capability I ndices

Report 2: Process Capability for Janitorial Services

15

Summary of Discrepancies of 2005for Electrical Equipment


Electrical Equipment

Oracle GL Utilization Report Discrepancies

Jan 2,976 0 2,976

Feb 4,646 6,492 (1,846)

Mar 61,632 6,492 55,140

Apr 75,533 60,297 15,236

May 84,599 4,870 79,729

Jun 87,049 87,049 0

Jul 95,449 87,049 8,400

Aug 100,727 87,049 13,678

Sep 102,602 80,433 22,169

Oct 106,676 80,433 26,243

Nov 107,107 107,107 0

Dec 164,960 213,925 (48,965)

MEASUREMEASURE

16

Process Capability for Electrical Equipment

MEASUREMEASURE

800006000040000200000-20000-40000

LSL USL

121110987654321

1000000

100000

10000

1000

100

10

1

Date:



Actual (LT)



Sigma(Z.Bench)

DPMO

-1.59

943730.9

-0.09

534619.3

Process Benchmarks

Report 1: Executive Summary: Electrical Equipment

17

Process Capability for Electrical Equipment

MEASUREMEASURE

121110987654321

80000

0

-80000

_X=22865

UCL=105070

LCL=-59340


100000

50000

0

__MR=30909

UCL=100989

LCL=0

ST


LT

1.50P.USL * 0.752530P.LSL * 0.191200P.Total 0.534619 0.943731

Mean

Yield 46.54 5.63DPMO 534619.3 943730.9Cp * *Cpk

3000

* *CCpk * *Pp * 0.03Ppk *

22865.2

-0.23

StDev * 26177.061Z.USL

50000 50000

101396-55666

I and MR Chart

Process Tolerance

Specifications


Process Tolerance

Specifications



Capability I ndices

Report 2: Process Capability for Electrical Equipment

18

Summary of Discrepancies of 2005 for Electricity


MEASUREMEASURE

Electricity

Oracle GL Utilization Report Discrepancies

Jan 160,460 169,009 (8,549)

Feb 160,460 169,009 (8,549)

Mar 510,256 508,640 1,616

Apr 687,714 679,403 8,311

May 878,452 863,608 14,844

Jun 1,081,136 1,062,766 18,370

Jul 1,080,746 1,255,573 (174,827)

Aug 1,475,835 1,455,756 20,079

Sep 1,670,093 1,655,350 14,743

Oct 1,852,871 1,655,350 197,521

Nov 1,852,871 2,019,999 (167,128)

Dec 2,232,990 1,874,279 358,711

19

Process Capability for Electricity

MEASUREMEASURE

3000002000001000000-100000-200000

LSLUSL

121110987654321

1000000

100000

10000

1000

100

10

1

Date:



Actual (LT)



Sigma(Z.Bench)

DPMO

-2.21

986563.4

-0.71

762186.4

Process Benchmarks

Report 1: Executive Summary: Electricity

20

Process Capability for Electricity

MEASUREMEASURE

121110987654321

400000

200000

0

_X=82771

UCL=262892

LCL=-97351


200000

100000

0

__MR=67726

UCL=221279

LCL=0

ST


LT

1.50P.USL * 0.745800P.LSL * 0.240763P.Total 0.762186 0.986563

Mean

Yield 23.78 1.34DPMO 762186.4 986563.4Cp * *Cpk

3000

* *CCpk * *Pp * 0.01Ppk *

82770.7

-0.22

StDev * 117596.950Z.USL

50000 50000

435562-270020

I and MR Chart

Process Tolerance

Specifications


Process Tolerance

Specifications



Capability I ndices

Report 2: Process Capability for Electricity

21

Detailed Budget Monitoring Process Map (As Is) for Janitorial Services

As-is Process Map for Budget Monitoring for Janitorial Services

RFP Approver

OAFA-FM RFP Creator

OAFA-FM Staff Handling Janitorial

ServicesBudget Coordinator

START

Inform OAFA-FM staff handling Janitorial Services Contract of approved budget

Prepare Janitorial Services Monitoring Worksheet

Certify Services Rendered

Prepare RFP

Verify RFP and Submit for Approval

Get Data on Monthly Utilization

Monthly Billing Submitted by Service Provider?

YesYes

NoNo

Estimate Monthly Billing

Update Actual Payment Column

Update Committed Column

Update Entry in Summary Table of Monthly OAFA-FM Budget Utilization

Submit Monthly Budget Utilization Report

END

Services Rendered?

YesYesNoNo

Approve RFP

to Controllers for Processing

MEASUREMEASURE

22

Detailed Budget Monitoring Process Map (As Is) for Electrical Equipment

As-is Process Map for Budget Monitoring for Electrical Equipment

MMUOAIS-PCRP ApproverOAFA-FM RP

VerifierOAFA-FM RP Creator/

InitiatorBudget Coordinator

START

Prepare Electrical Equipment Monitoring

Worksheet

Request for Data (RP/PO Summary) on Monthly

Budget Utilization

Inform OAFA-FM RP Creator of

Approved Budget

Create Monitoring Sheet for RPs –

Served (delivered) and Unserved (PO/

no PO)

Create RP for Electrical

Equipment

Verify RP Approve RP Process RP

Accept Goods Delivered

Prepare RP/PO Summary Report

Data Received?

Get Data on Actual Payments from

Oracle and Commitments from

Old Reports

Update Monitoring Worksheet

YES

NO

Submit Monthly Budget Utilization

Report

END

Inform OAFA-FM staff handling Electrical

Equipment Services of approved budget

Receive GoodsIssue PO

Update Monitoring Sheet for RPs –

Served (delivered) and Unserved (PO/

no PO)

MEASUREMEASURE

23

Detailed Budget Monitoring Process Map (As Is) for Electricity

As-is Process Map for Budget Monitoring for Electricity

RFP Approver

OAFA-FM RFP Creator

OAFA-FM Staff Handling Electricity

Budget AccountBudget Coordinator

START

Prepare Electricity Monitoring Worksheet

Verify Electricity Consumption

Prepare RFP



Monthly Electricity Bill Received?

YesYes

NoNo


Update Actual Payment Column

Update Committed Column


Submit Monthly Budget Utilization Report

END

Bill Correct? YesYes

NoNo

Approve RFP


MEASUREMEASURE

24Procedures

People

Cause and Effect Diagram forJanitorial Services

Discrepancies between Actual Expenses of Oracle GeneralLedger and Monthly UtilizationReport

Different US Dollar-Peso exchange used in monthly utilization report

Not checking actual expenses recorded in Oracle General Ledger

Not familiar with Oracle-GL Inquirer and related functionalities including available reports/data

Variation of closing date of Oracle General Ledger and date of generating of monthly utilization report/ no common reference point of information

Oracle – not user friendly

Technology

Not Familiar with terminologies, policies,procedures of budget, accountingand other related procedures

Work schedule of budget coordinator and OAFA-FM staff – difficulty incoordination and gathering of data

shift schedule

C

N

C

C

C

C

C

CTreatment of actual payment and commitments

25

Results of Brainstorming of Proposed Solutions for Janitorial Services

ANALYZEANALYZE

CONTROL FACTORS ISSUES/CONCERNS PROPOSED SOLUTIONS

1. Not familiar with terminologies, policies, procedures of budget, accounting and other related procedures

Conduct an orientation on common terms used, policies, procedures of budget, accounting and other related procedures. - to have a common understanding

2. Not familiar with ORACLE GL Inquirer and related functionalities including available reports/data

For this project, will concentrate on OAFA-FM particularly the 3 administrative expense accounts.

Conduct a training session with concerned budget coordinators in coordination with CTL on use of Oracle and the available reports/data that can be used in budget monitoring

3. Variation between closing dates of Oracle General Ledger and date of generating monthly utilization report/no common reference point of information

As confirmed with CTL, closing of general ledger is at the 8th of the succeeding month. When actual expenses are downloaded earlier than the specified date, the figures will still change upon final closing of general ledger. It is not advisable to inquire from the system or run the report earlier than 8th of the month.

Need to discuss this with OAS Management if budget utilization report can be submitted on a later date.

The Budget Utilization Report from OAS Divisions is submitted every 5th of the month as part of the monthly work status/accomplishment report. We shall explore the possibility of changing the submission date of the Budget Utilization Report, to synchronize with the closing date of the GL system of CTL. -

26

Results of Brainstorming of Proposed Solutions for Janitorial Services

ANALYZEANALYZE


4. Treatment of actual payment and commitments

The training sessions will address some of the issues involved.

Create a common understanding on the treatment of expenses, when it is considered “actual expense” and “commitments”.

Enhance/standardize the current monitoring report.

5. Not checking actual expenses recorded in Oracle General Ledger

Introduce additional step in the current monitoring process whereby the staff concerned should check actual expenses in Oracle General Ledger System and reconcile with his monitoring report/sheet.

6. Different US Dollar-Peso exchange rate used in monthly utilization report

Common reference point for exchange rates – ADB Portal

7. Work schedule of budget coordinator and OAFA-FM staff – difficulty in coordinating and gathering of data - shift schedule

Regular work schedule for budget coordinator – for easy coordination

27

Technology

Procedures

People

Cause and Effect DiagramFor Electrical Equipment


Not familiar with terminologies, policies, procedures of budget, accounting, accrual and other related procedures

Different sources of dataused in budget monitoring

Variation between closing date of Oracle GL and date of generating of monthly utilization report/ no common reference point of information.


Not checking actual expenses recorded in Oracle GL

Work schedule of budget coordinator and OAFA-FM staff – difficulty in coordination and gathering of data

shift schedule

C

C

C

C

N

C

C


28

Results of Brainstorming of Proposed Solutions for Electrical Equipment

ANALYZEANALYZE










The Budget Utilization Report from OAS Divisions is submitted every 5th of the month as part of the monthly work status/accomplishment report. We shall explore the possibility of changing the submission date of the Budget Utilization Report, to synchronize with the closing date of the GL system of CTL.

29

Results of Brainstorming of Proposed Solutions for Electrical Equipment

ANALYZEANALYZE




Create a common understanding on the treatment of expenses, when it is considered “actual expense” and “commitments”..






7. Different sources of data used in budget monitoring

Identify common source of data from Oracle to budget coordinators: - GL Inquirer – Trial Balance Summary 2 - PO Internal Requestor – ADB PO Budget Monitoring Report (Text)



LONG TERM: A full-time staff that has basic knowledge of accounting, budget should be assigned in monitoring the budget of OAFA-FM.

30Technology

Procedures

People

Cause and Effect Diagramfor Electricity


Different US Dollar-Peso exchange rate used in monthly utilization report

Not checking actualexpenses recorded in Oracle General Ledger


Variation between closing dates of Oracle General Ledger and date of generating ofmonthly utilization report/ no common reference point of information. Work schedule of budget

coordinator and OAFA-FM staff – difficulty incoordination and gathering of data

shift schedule

Not Familiar with terminologies, policies,procedures of budget, accountingand other related procedures

N

C

C

C

C

C

C

Treatment of actual payment and commitments

C


31

Results of Brainstorming of Proposed Solutions for Electricity

ANALYZEANALYZE










The Budget Utilization Report from OAS Divisions is submitted every 5th of the month as part of the monthly work status/accomplishment report. We shall explore the possibility of changing the submission date of the Budget Utilization Report, to synchronize with the closing date of the GL system of CTL.

32

Results of Brainstorming of Proposed Solutions for Electricity

ANALYZEANALYZE




Create a common understanding on the treatment of expenses, when it is considered “actual expense” and “commitments”.








LONG TERM: A full-time staff that has basic knowledge of accounting, budget should be assigned in monitoring the budget of OAFA-FM.

33

Jan-Jun 2006 Summary of Discrepancies of Utilization Report

IMPROVEIMPROVE

JANITORIAL SERVICES

Oracle GL FM Utilization Report Discrepancies

Jan 0.00 0.00 0.00

Feb 528.50 27,336.75 26,808.25

Mar 79,076.38 27,336.75 (51,739.63)

Apr 27,797.38 27,336.75 (460.63)

May 80,500.23 79,886.53 (613.70)

Jun 106,728.14 105,096.34 (1,631.80)

34

Current Process Capability for

Janitorial Services Jan-Jun 2006

IMPROVEIMPROVE

6000040000200000-20000-40000-60000

LSLUSL

654321

1000000

100000

10000

1000

100

10

1

Date:

Lower Spec: 0Nominal: 3000 Opportunity:

Reported by:Project:Department:Process:Characteristic:Units:Upper Spec: 5000

Actual (LT)



Sigma(Z.Bench)

DPMO

-1.46

928421.3

0.04

485694.5

Process Benchmarks

Report 1: Executive Summary

35

Improved Process Map for Janitorial Services

IMPROVEIMPROVE

Improved Process Map for Budget Monitoring for Janitorial Services 26 May 2006

RFP Approver

OAFA-FM RFP Creator

OAFA-FM Staff Handling Janitorial

ServicesBudget Coordinator

START

Inform OAFA-FM staff handling Janitorial Services Contract of approved budget

Prepare Janitorial Services Monitoring Worksheet

Certify Services Rendered

Prepare RFP



Monthly Billing Submitted by Service Provider?

YesYes

NoNo



Submit Monthly Budget Utilization Report on or before 15th of the month

END

Services Rendered?

YesYesNoNo

Approve RFP


Input data in Commitment Column

Check $ exchange at the ADB PortalOAOD to advice schedule of closing of books

Check Oracle GL as of cut-off date

Update Actual Payment/Commitment Column

36

Budget Utilization Report for Janitorial Services

(Pilot Test)IMPROVEIMPROVE

Janitorial Services

Oracle GLFM Utilization Report (Improved Process) Discrepancies

Jan 0.00 0.00 0.00

Feb 528.50 528.50 0.00

Mar 79,076.38 79,076.38 0.00

Apr 27,797.38 27,797.38 0.00

May 80,500.23 80,500.23 0.00

Jun 106,728.14 106,728.14 0.00

TOTAL 106,728.14 106,728.14 0.00

37


(Pilot Test)IMPROVEIMPROVE

Janitorial Services

OAFA-FMDiscrepancies

Improved ProcessDiscrepancies

Jan 0.00 0.00

Feb 26,808.25 0.00

Mar (51,739.63) 0.00

Apr (460.63) 0.00

May (613.70) 0.00

Jun (1,631.80) 0.00

38


IMPROVEIMPROVE

Janitorial Services (Data Model)

Discrepancies

Jan 0.000001

Feb 0.000002

Mar 0.000001

Apr 0.000002

May 0.000001

Jun 0.000001

• Data model close to zero created to show six sigma level

39

Process Capability forJanitorial Services

(Data Model)

IMPROVEIMPROVE

0.000

753

0.000

502

0.000

251

-0.00

0000

-0.00

0251

-0.00

0502

-0.00

0753

LSL USL

654321

1000000

100000

10000

1000

100

10

1

Date:



Actual (LT)



Sigma(Z.Bench)

DPMO

2.46

7008.1

3.96

38.0

Process Benchmarks


40

Process Capability forJanitorial Services

(Comparison)IMPROVEIMPROVE

Sigma LevelImproved Process

Sigma LevelCurrent FM Process

41

Improved Process for Janitorial Services

IMPROVEIMPROVE

Given that:

Sigma level of 6 = 3.4 DPMO vs. Improved process = 0 DPMO

We conclude that we have reached or even exceeded our goal to reduce the discrepancy between monitoring/ utilization report and the general ledger of Oracle to $5000 or less. A zero discrepancy has been achieved for the Janitorial services improved process monitoring report.

TARGET MET!!!

42

IMPROVEIMPROVE



Jan 29,527.14 0.00 (29,527.14)

Feb 30,957.86 0.00 (30,957.86)

Mar 30,975.86 30,957.86 (18.00)

Apr 85,476.10 30,957.86 (54,518.24)

May 85,824.23 85,557.02 (267.21)

Jun 85,816.30 85,557.02 (259.28)


43

IMPROVEIMPROVE

200000-20000-40000-60000

LSLUSL

654321

1000000

100000

10000

1000

100

10

1

Date:



Actual (LT)



Sigma(Z.Bench)

DPMO

-1.60

944855.6

-0.10

538595.6

Process Benchmarks

Report: Executive Summary for Electrical Equipment


Electrical Equipment Jan-Jun 2006

44

Improved Process Map for Electrical Equipment

IMPROVEIMPROVE

Proposed Improved Process Map for Budget Monitoring for Electrical Equipment as of 26 May 2006

MMUOAIS-PCRP ApproverOAFA-FM RP

VerifierOAFA-FM RP Creator/InitiatorBudget Coordinator

START

Prepare Electrical Equipment Monitoring

Worksheet

Inform OAFA-FM RP Creator of

Approved Budget

Check previous year’s unserved POs and include in current year’s commitment

Create RP for Electrical Equipment

Verify RP Approve RP Process RP

Accept Goods Delivered

Update RP/PO Status Monitoring

Sheet

Prepare RP/PO Summary Report

and Submit Budget Utilization

Figures

Update Monitoring Worksheet

Submit Monthly Budget Utilization

Report

END

Inform OAFA-FM staff handling Electrical

Equipment Services of approved budget

Receive GoodsIssue PO

Check Oracle GL and Confirm

Figures for Actual Payments Made

Create Monitoring Sheet for RPs – Served (delivered) and

Unserved (PO/no PO)

Check Oracle GL for Actual

Payments made as of Cutoff Date

Check $ exchange rate at the ADB Portal

OAOD to advise schedule of closing of books

45

IMPROVEIMPROVE Budget Utilization Report for Electrical Equipment

PILOT TEST


Oracle GL

FM Utilization Report (Improved Process) Discrepancies

Jan 29,527.14 29,527.14 0.00

Feb 30,957.86 30,964.25 6.39

Mar 30,957.86 30,964.25 6.39

Apr 85,476.10 85,482.49 6.39

May 85,824.23 85,831.08 6.85

Jun 85,816.30 85,823.15 6.85

Jul 87,133.54 87,132.46 (1.08)

Aug 87,133.54 87,132.46 (1.08)

46

Process Capability forElectrical Equipment -

IMPROVEDIMPROVEIMPROVE

980

840

700

560

420

280

1400

LSL USL

87654321

1000000

100000

10000

1000

100

10

1

Date:



Actual (LT)



Sigma(Z.Bench)

DPMO

0.98

164460.0

2.48

6637.8

Process Benchmarks


47

Improved Process Capability for

Electrical Equipment IMPROVEIMPROVE

87654321

10

5

0

_X=3.84

UCL=9.45

LCL=-1.78

Observation87654321

8

4

0

__MR=2.111

UCL=6.899

LCL=0

ST

* 1270.65Z.LSL * 0.98Z.Bench 2.48 0.98Z.Shift 1.50

LT

1.50P.USL * 0P.LSL * 0.164460P.Total 0.0066378 0.164460

Mean

Yield 99.34 83.55DPMO 6637.8 164460.0Cp * *Cpk

3000

* *CCpk * *Pp * 211.94Ppk *

3.83875

0.33

StDev * 3.932Z.USL

50000 50000

15.6347-7.95716

I and MR Chart

Process Tolerance

Specifications


Process Tolerance

Specifications



Capability I ndices

Report 2: Process Capability for Electrical Equipment (Improved)

48

Process Capability forElectrical Equipment




49

Budget Utilization Report for Electrical Equipment

IMPROVEIMPROVE


OAFA-FM Discrepancies

Improved Process Discrepancies

Jan (29,527.14) 0.00

Feb (30,957.86) 6.39

Mar 0.00 6.39

Apr (54,518.24) 6.39

May (267.21) 6.85

Jun (259.28) 6.85

Jul (1,576.52) (1.08)

Aug 0.00 (1.08)

50

Improved Process for Electrical Equipment

IMPROVEIMPROVE

We conclude that we have reached our goal to reduce the discrepancy between monitoring/ utilization report and the general ledger of Oracle to $5000 or less.

TARGET MET!!!

51


IMPROVEIMPROVE

Electricity


Jan (11,633.26) 0.00 11,633.26

Feb 144,817.87 338,788.77 193,970.90

Mar 518,873.43 528,943.55 10,070.12

Apr 518,873.43 726,784.71 207,911.28

May 716,027.78 901,523.25 185,495.47

Jun 1,103,606.07 1,108,885.90 5,279.83

52

IMPROVEIMPROVE

3000002000001000000-100000

LSLUSL

654321

1000000

100000

10000

1000

100

10

1

Date:



Actual (LT)



Sigma(Z.Bench)

DPMO

-2.25

987681.8

-0.75

772485.4

Process Benchmarks

Report: Executive Summary for Electricity


ElectricityJan-Jun 2006

53

Improved Process Map for Electricity

IMPROVEIMPROVE

Proposed Improved Process Map for Budget Monitoring for Electricity as of 25 May 2006

RFP Approver

OAFA-FM RFP Creator

OAFA-FM Staff Handling Electricity

Budget AccountBudget Coordinator

START

Prepare Electricity Monitoring Worksheet

Verify Electricity Consumption

Prepare RFP


Monthly Electricity Bill Received?

YesYes

NoNo


Update Actual Payment/Commitment Column

Input data in Commitment Column


Submit Monthly Budget Utilization Report on or before 15th of the month

END

Bill Correct?YesYesNoNo

Approve RFP


OAOD to advice schedule of closing of books

Check Oracle GL as of cut-off date

Check $ exchange at the ADB Portal

54

IMPROVEIMPROVE

Electricity

Oracle GLFM Utilization Report(Improved Process) Discrepancies

Jan (11,633.26) (11,633.26) 0.00

Feb 144,817.87 144,817.87 0.00

Mar 518,873.43 518,873.43 0.00

Apr 518,873.43 518,873.43 0.00

May 716,027.78 716,027.78 0.00

Jun 1,103,606.07 1,103,606.07 0.00

Budget Utilization Report for Electricity

(PILOT TEST)

55

Budget Utilization Report for Electricity (Pilot Test)

IMPROVEIMPROVE

Electricity

OAFA-FMDiscrepancies

Improved ProcessDiscrepancies

Jan 11,633.26 0.00

Feb 193,970.90 0.00

Mar 10,070.12 0.00

Apr 207,911.28 0.00

May 185,495.47 0.00

Jun 5,279.83 0.00

56

Process Capability forElectricity




57

Improved Process for Electricity

IMPROVEIMPROVE

Given that:

Sigma level of 6 = 3.4 DPMO vs. Improved process = 0 DPMO

We conclude that we have reached or even exceeded our goal to reduce the discrepancy between monitoring/ utilization report and the general ledger of Oracle to $5000 or less. A zero discrepancy has been achieved for the Electricity improved process monitoring report.

TARGET MET!!!

58

As of ______________________

Unbilled services *

Processed Payments

Outstanding RPs

POs Issued

Delivered **

Rental 75,650.00 0 75,650 0.0%

Building Maintenance Services President's Residence 19,000.00 0 19,000 Building & Grounds 122,400.00 0 122,400 Pest Control 26,400.00 0 26,400 Janitorial Services 272,000.00 0 272,000 Garbage Collection 16,200.00 0 16,200 Elevators 220,400.00 0 220,400 Engineering Oper & Maint. 590,000.00 0 590,000

Building Maintenance Supplies Electrical 85,000.00 0 85,000 Mechanical 100,000.00 0 100,000 Building and Grounds 100,000.00 0 100,000 Janitorial supplies 125,500.00 0 125,500 Fire protection supplies 6,500.00 0 6,500

Building Equipment & Spare Parts Electrical 165,000.00 0 165,000 Mechanical 150,000.00 0 150,000 Audio-visual 5,000.00 0 5,000 Janitorial Equipment / Tools 31,000.00 0 31,000 Fire Protection Equipment 6,500.00 0 6,500

Alterations and Improvement 330,000.00 0 330,000

Utilities Electricity 1,900,000.00 0 1,900,000 Water 82,800.00 0 82,800 LPG and others 47,200.00 0 47,200 Other contractual services Waste Material Disposal 1,900.00 0 1,900

* pertain to services

** Pos delivered but not yet paid

Approved Budget

(a)

Budget AccountUtilization

(%)(f=d/a)

Budget Balance (e=a-d)

Commitments (b) Actual Expense

(c)

Total Utilization

(d=b+c)Services Goods

59

CONTROLCONTROLStakeholder Analysis

Commitment Scale for Improvement of Budget Monitoring Processfor Janitorial Services, Electricity and Electrical Equipment

Level of CommitmentOAFA-FM

(Process Owners)Head, OAFA-FM

Enthusiastic Support X O

Help it work O

Compliant X

Hesitant

Indifferent

Uncooperative

Opposed

Hostile

X : Current level of commitment

O: Level of commitment needed

People

60

CONTROLCONTROLRisk Assessment of Improved Budget

Monitoring Process of Janitorial Services, Electrical Equipment and Electricity

Risk Item Probability Impact Risk Level Abatement

M M 4

M M 4

L H 3

L H 3

M H 6

Legend:

Probability - High (H)=3, Medium (M)=2, or Low (L)=1

Impact - High (H)=3, Medium (M)=2, or Low (L)=1

Risk Level - Quantify the risk level of each item by mutliplying its ratings of probability and impact

Negative attitude against usability of Oracle

The involved budget coordinator is still working on a

shift work schedule.

Budget coordinators may not strictly follow the improved

process

Not checking the GL Oracle regularly to update the budget

monitoring sheet

Viewing the GL inquirer before closing of general

ledger/books.

- Should explain to staff and remind them

that figures obtained from the GL before closing are not final; there may be changes in the total actual expense for the month/period.

- Until the date of submission of monthly

utilization report has been changed, there is a need to generate the figures after GL closing.

To train and closely guide the process owner on use of Oracle; provide clear

guidelines/step by step process on how to use Oracle - some of the negative

perception may actually be unfamiliarity with the correct procedures

Remind the budget coordinator to check regularly; explain to staff the importance of checking the Oracle GL to ensure accuracy

of budget monitoring.

Request for back-up who is not on shift schedule.

Meet with budget coordinators every 2 months, discuss the merits/benefits of the process; there is a control sheet to monitor if budget coordinators are following the improved process.

61

Monitoring Control Sheet of Improved Budget Monitoring Process for Janitorial Services

OAFA-FMBudget

Coordinator

Staff Handling Janitorial

Services Budget Account

OAOD TimingImplementation

Status

1. At the start of the year, the budget coordinator prepares a monitoring worksheet for the Janitorial Services Budget Account. This worksheet should reflect any expenses accrued from the previous year. Budget utilization is classified as:a.Commitment – estimated expense based on previous utilization for unbilled services; and unprocessed bills b. Processed Payment – RFP processed but not yet disbursed

c. Actual Payment – disbursed payment as reflected in the Oracle General Ledger (GL) *NOTE: * Any unusual entries in the GL should be clarified with CTL.

X

January

Partially implemented.

2. Budget coordinator gets data on monthly budget utilization by checking if the monthly bill has been received. If the monthly bill is not received, monthly utilization is estimated and reflected in the monitoring sheet as a commitment.

X Monthly On-going

3. If the monthly bill is received, the staff handling this account verifies the bill if it reflects the correct amount based on contract provisions. Verified bill is sent to RFP creator for payment.

X Partially implemented

4. Budget coordinator verifies the RFP and encodes the amount in the monitoring sheet as a Processed Payment. Dollar conversion is based on forex rate at the ADB Portal

X Partially implemented

5. Schedule of closing of books by Controllers is advised. X For implementation

6. Budget coordinator checks the Oracle GL as of cut-off date to see actual expenses. If processed payment has been recorded in the GL, the Actual Payment column is updated.

X For implementation

7. Budget coordinator updates the entries in the Monthly Budget Utilization Report with Commitment, Processed Payment and Actual Expenses.

X On-going

62

Monitoring Control Sheet of Improved Budget Monitoring Process for Electrical Equipment

OAFA-FMBudget

CoordinatorRP Creator OAOD Timing

Implementation Status

1. At the start of the year, the budget coordinator prepares a budget monitoring worksheet for the Electrical Equipment Budget Account. The Budget utilization in the monitoring sheet is classified as:a.Commitment – Requests for Purchase (RPs) with Purchase Orders (POs) awaiting delivery -- Outstanding RPs which were not procured in the previous year and will continue procurement process

b. Processed Payment – Goods delivered and accepted but not yet paid

c. Actual Payment – paid POs and disbursed payments as reflected in the Oracle General Ledger (GL) *NOTE: * Any unusual entries in GL should be clarified with CTL. At the beginning of the year, should include in the monitoring the previous year’s PO delivered and paid in the current year.

X

January

Partially implemented.

2. At the start of the year, the RP Creator prepares an RP monitoring worksheet for the Electrical Equipment Budget Account. This worksheet should reflect the outstanding RPs and POs.The worksheet should contain the following information:

a. Outstanding RPsb. Outstanding POs c. Delivered POs but not yet paid

d. Paid POs and actual payment/expense

X Monthly On-going.

3. Create RP for Electrical Equipment and input it as unserved RP X On-going

4. Check PO Budget Monitoring Report and check status of RP, if PO has been issued.

X On-going

Accept delivered goods and update RP monitoring worksheet to show amount of PO served but not yet paid.

X On-going

5. Schedule of closing of books by Controllers is advised. X For implementation.

6. RP Creator checks the Oracle GL as of cut-off date to see actual expenses. Summarize RP monitoring sheet with month’s figures and submit to budget coordinator.

X For implementation.


X Partially implemented.

63

Monitoring Control Sheet of Improved Budget Monitoring Process for Electricity

OAFA-FMBudget

Coordinator

Staff Handling Electricity Budget

AccountOAOD Timing

Implementation Status

1. At the start of the year, the budget coordinator prepares a monitoring worksheet for the Electricity Budget Account. Budget utilization in the monitoring sheet is classified as:a.Commitment – estimated expense based on previous utilization for unbilled services; and unprocessed bills

b. Processed Payment – RFP processed but not yet disbursedc. Actual Payment – disbursed payment as reflected in Oracle

General Ledger (GL) * NOTE: * Any unusual entries in the GL should be clarified with CTL.

X

January

Partially implemented

2. Budget coordinator gets data on monthly budget utilization by checking if the monthly bill has been received. If the monthly bill is not received, monthly utilization is estimated and reflected in the monitoring sheet as a commitment.

X Monthly On-going

3. If the monthly bill is received, the staff handling this account verifies the bill if it reflects the correct electricity consumption. Verified bill is sent to RFP creator for payment.

X Partially implemented,

4. Budget coordinator verifies the RFP and encodes the amount as a Processed Payment. Dollar conversion is based on forex rate at the ADB Portal

X Partially implemented.

5. Schedule of closing of books by Controllers is advised. X For implementation.

6. Budget coordinator checks the Oracle GL as of cut-off date to see actual expenses. If processed payment has been recorded in GL, the Actual Payment column is updated.

X For implementation.


X On-going.

64

Benefits

Time and Efficiency

Estimated annual savings of about $1,800 resulting from a more efficient monitoring process, time to review figures, inquire and collaborate Skills and competence of budget coordinators improved in terms of knowledge of budget through training and orientation

The result of an efficient budget monitoring will greatly assist Head, OAFA-FM in planning the section’s resources and in decision making.

Increase in productivity as a result of the efficiency in monitoring budget, the staff will be able to use his time to do other important and technical activities.

65

Time Line

Define

Measure

Analyze

Control

Improve

Jan 2006

Feb – Mar 2006

Apr – Aug 2006

Sep-Oct 2006

Feb 2006

D

A

I

C

M

66

Thank you!

Project Charter

Documents

janitorial supplies173

janitorial supplies147

janitorial serv273

janitorial services235

janitorial equipmenttools22

janitorial equipmenttools14

budget monitoring system

electrical supplies152