The Virginia National Guard Cooperative Agreement Process is how the State Department of Military Affairs seeks reimbursement from the Federal government for services rendered. This process was functioning in such a poor state that senior leaders in Virginia were considering furloughing employees due to tied up funds. At the end of this process we were able to take the reimbursement time from an average of 49 days to 5 days, improved their delinquency rate and standardized the process across all functions. This also resulted in a cost avoidance of 50% on behalf of the Federal Government while improving transparency for all parties involved.

1. Lean Six Sigma
Reimbursement of Cooperative
Agreement Money
LD28627
QRPA
Foster, James, BBc
Cree, Jeffery, Project Sponsor
Riley, Michael, MBB, Mentor
Detwiler, Jason, RM
Project Initiation Date: 01 MAR 18
Define Tollgate Date: 20 MAR 18

2. Define
2
Problem Statement/Goal Statement
 Problem statement
 It takes the VAARNG too long to reimburse the state of
Virginia money owed in accordance with Cooperative
Agreements.
 Goal statement
 Reduce reimbursement time to 30 days from the time
Virginia incurs an expense until restitution is made.

3. Define
Project Scope
• Scope-in
• VAFM O&E process beginning when the state of Virginia
incurs an obligation for work received IAW the CA and the
last step is when the National Guard reimburses state of
Virginia.
• The following are excluded: Any process not related to
VAFM O&E; Any process the state of Virginia performs after
receiving funds.
3

4. Define
4
SIPOC map
Suppliers Inputs Process Outputs Customers
• Complete CA
Package
• State of VA
Reimbursed
• Invoices
• State GL
• CAAppendix
• FMZ/5A
Recon
• State of VA
• VAARNG
• Vendor
• State of VAInvoices
Re’cvd
State A/P
Pays
Invoice
CFA
creates
Packet
BA
Aligns
Money
State
CFO
Signs
Fed PM
Signs
GOR
Signs
USPFO
Signs
Input Metrics Process Metrics Output Metrics
Quality
Speed
Cost
• Invoices Allow/Unallowable
• GL matches invoices
• State AMSCO submitted to Fed
• # of Packets Started bi-weekly
• Invoice Coded Correctly
• # of Packets Compiled
• State/Fed Budget Lines up
• # of Days to CFO Signature
• # of Invoices Accepted at A/P
• # of Packets Signed
• # of Packets Re’cving Funds
• # of Packets Processed within 15
working days
VOC/VOB
• VOC
• VOB
• VOB • Late fees associated with late invoices • # of invoices processed on
time
• # of invoices paid on time

5. Define
Process map
CFA
Accountant
State
A/P
State
CFO
Facilities
Office
Places
information
into Cardinal
Sends GL File
to State BA
for Review
Pays
Vendor
State
Budget
Analyst
Fed
Budget
Analyst
Creates Final Packet
for CFO Signature
Certifies Packet
Reviews Invoices
to GL File
Delay
Up To
4 Weeks
PO Approves
Contract/ Codes
Invoices
Green (CVA); Amber (NVA-R); Red (NVA)
Sends
Invoices
Lines up
State/Fed
Funding

6. Define
Process map continued
GOR
GOR
Assist.
Commercial
Accounts
Federal
Account
Manager
Reviews Packet
For Correctness
USPFO
Comptroller
Certifies Packet
Reviews Packet
For Correctness
Green (CVA); Amber (NVA-R); Red (NVA)
Certifies Packet
Processed For
Payment
Release Of Funds
To State

7. Define
77
Voice of the Customer/Voice of the Business
VOC Key Customer Issue(s) CCR
What does the customer want from us? We need to identify the issue(s) that
prevent us from satisfying our customers.
We should summarize key issues and translate
them into specific and measurable requirements
To be reimbursed in a timely manner GOR finds errors in Packets Reimbursement takes longer than 60
days
VOB Key Business Issue(s) CBR
What does the business want from us? We need to identify the issue(s) that
prevent us from meeting strategic
goals/missions.
We should summarize key issues and translate
them into specific and measurable requirements
Improved Cash Flow Enough money for the State to
work through planned projects
State not reimbursed in a timely manner
after paying the vendor

8. Define
8
Communication Plan
Project Sponsor FTF Inform Project Status Belt Bi-Weekly
Project Team FTF Data collection Tasks & Issues Belt Weekly
Resource
Manager
FTF Benefits
recording
Financial data
entry
Belt As needed
Mentor FTF Status
Updates
Project Status Belt As needed
FMO Pre-Tollgate
Meeting
Status Update Tollgate Project
Sponsor
As needed
Audience Media Purpose
Topics of
Discussion/
Key Messages
Owner Frequency Notes/Status

9. Define
9
Operational Definitions
 Terms:
 Cooperative Agreement (CA): Any agreements entered into by the Department of Defense, National
Guard Bureau, with the States, funded by Department of Defense appropriations for the Army National
Guard and Air National Guard, for construction, minor construction, maintenance, repair, or operation of
facilities, operations of the Army National Guard and Air National Guard, and for other programs
authorized and directed by Congress or the Department of Defense to be performed by the States and
the National Guard Bureau
 ARNG: Army National Guard
 CFMO: Chief Facilities Management Officer
 GOR: Grant’s Officer Representative
 USPFO: United States Property & Fiscal Officer
 O&M: Operations and Maintenance
 Packet: Invoice/General Ledger/Signature Page organized to create a comprehensive view of the
expense the State is seeking reimbursement for.
 Appendix: The applicable portion of the Master Cooperative Agreement
 Packet Cycle Time: The total number of Days/hours a Packet takes from initial invoicing to
reimbursement from the VA ARNG to the State of VA
 Total hours Worked: The total number of hours worked in the facility including weekends and holidays.
 Number of Personnel: The total number of military and civilian personnel working (not including
contractors)
 FMO: Facilities Maintenance Office

10. Define
10
Data Collection Plan
Performance
Measure
Operational
Definition
Data Source
and Location
How Will Data
Be Collected
Who Will
Collect Data
When Will Data
Be Collected
Sample
Size
Stratification
Factors
How will data
be used?
Length of Packet
processing
Time from
when the
invoice is
received to
when the State
receives
reimbursement
GEARs Data will be pulled
from GEARs once
packets are
complete
James Foster Once; GEARs will hold
information for 10
days at a time to give
me a sample for all
packets in the cycle
33 O&M Packets To determine
PCT

11. Define
11
Measurement Systems Analysis
Type of
Measurement Error
Description Considerations to this Project
Discrimination
(resolution)
The ability of the measurement system
to divide measurements into “data
categories”
Packet Cycle Time is measured in Days
and type of Packet – This provides
enough detail
Bias
The difference between an observed
average measurement result and a
reference value
No bias – Data is provided from GEARs,
an automated system that provides
star/end dates.
Stability The change in bias over time
The data is in a read-only status once
the Packet has completed its lifecycle –
No ability to alter dates.
Repeatability The extent variability is consistent
Not an issue. Data is located in a site
that is Read Only once the Packets are
complete.
Reproducibility
Different appraisers produce consistent
results
Data set has the name of Packets so
anyone can pull the same sample set to
get the exact same results.
Variation The difference between parts N/a to this process.

12. Define
 The AD Normality
test indicate the data
is NOT normal
 The Mean value for
the data is 49.796
days
 Standard deviation is
36.198 days
12
Baseline Process Performance
150100500-50
99
95
90
80
70
60
50
40
30
20
10
5
1
Mean 49.80
StDev 36.20
N 33
AD 1.373
P-Value <0.005
PCT
Percent
Probability Plot of PCT
Normal

13. Define
Baseline Process Performance – Over Time
 The I-MR chart indicates
the process is not in
control
 Individual Average of 49.8
days
 10 data points occur
outside of the UCL
Individually
13
0
20
40
60
80
100
120
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33
Moving Range
Moving Range Average mR URL
3128252219161310741
100
75
50
25
0
ObservationIndividualValue
_
X=49.8
UCL=90.7
LCL=8.9
3128252219161310741
100
75
50
25
0
Observation
MovingRange
__
MR=15.4
UCL=50.2
LCL=0
1111
11
111
1
1
1
1
I-MR Chart of PCT

14. Define
1501209060300
LSL *
Target 25
USL 25
Sample Mean 49.7961
Sample N 33
Shape 1.35935
Scale 54.2858
Process Data
Pp *
PPL *
PPU -0.18
Ppk -0.18
Overall Capability
PPM < LSL *
PPM > USL 666666.67
PPM Total 666666.67
Observed Performance
PPM < LSL *
PPM > USL 705723.01
PPM Total 705723.01
Exp. Overall Performance
Target, USL
Process Capability Report for PCT
Calculations Based on Weibull Distribution Model
 The sample mean
of the baseline
process is 49.796
days
 Weibull Distribution
used as potential
process capability
given non-normal
data
 USL to the left
indicates poor
capability & not
centered
 Ppk of 0.18
confirms poor
capability given <
1.33
14
Baseline Process Capability

15. Define
15
FMEA

16. Define
Prioritized Root Causes
16

17. Define
Potential Solutions
17

18. Define
Evaluation Criteria
18

19. Define
19
Pilot Plan
1st Quartile 2.5736
Median 5.0738
3rd Quartile 7.4119
Maximum 12.6808
3.9692 6.4086
3.6424 6.8795
2.7663 4.5499
A-Squared 0.22
P-Value 0.830
Mean 5.1889
StDev 3.4399
Variance 11.8328
Skewness 0.021584
Kurtosis -0.548781
N 33
Minimum -1.4816
Anderson-Darling Normality Test
95% Confidence Interval for Mean
95% Confidence Interval for Median
95% Confidence Interval for StDev
12840
Median
Mean
7654
95% Confidence Intervals
Summary Report for C3
• Full
implementation of
changes in lieu of
pilot program
• New process will
be validated 3
months after
deployment
• Expecting an
average time of 5
days per invoice
under new process

20. Define
20
Pilot Plan
• Under the new
process invoices
will be expected to
have an average
moving rage of 4
days
• Under the new
process invoices
will be expected to
take approximately
5 days to complete
from the time the
State receives the
invoice until the
time the VAARNG
processes for
payment
3128252219161310741
15
10
5
0
-5
Observation
IndividualValue _
X=5.19
UCL=15.68
LCL=-5.31
3128252219161310741
12
9
6
3
0
Observation
MovingRange
__
MR=3.95
UCL=12.89
LCL=0
I-MR Chart of C3

21. Define
21
Pilot Plan
Setting the USL at 7 days will bring the process more centered vs the current right skewed capability
121086420-2
LSL *
Target *
USL 7
Sample Mean 5.18891
Sample N 33
StDev(Overall) 3.43989
StDev(Within) 3.49815
Process Data
Pp *
PPL *
PPU 0.18
Ppk 0.18
Cpm *
Cp *
CPL *
CPU 0.17
Cpk 0.17
Potential (Within) Capability
Overall Capability
PPM < LSL * * *
PPM > USL 242424.24 299270.95 302323.65
PPM Total 242424.24 299270.95 302323.65
Observed Expected Overall Expected Within
Performance
USL
Overall
Within
Process Capability Report for C3

22. Define
22
Pilot Plan
Customer Requirements
* * 7
Lower Spec Target Upper Spec
Process Characterization
Mean 49.796 5.1889 -44.607
StDev(overall) 36.199 3.4399 -32.759
Actual (overall) capability
Pp * * *
Ppk -0.39 0.18 0.57
Z.Bench -1.18 0.53 1.71
% Out of spec 88.14 29.93 -58.22
PPM (DPMO) 881446 299271 -582175
Statistics Before After Change
66%
Yes No
0 0.05 0.1 > 0.5
P < 0.001
Yes No
0 0.05 0.1 > 0.5
P < 0.001
Before
USL
After and drifts were eliminated.
Potential (within) capability is what could be achieved if process shifts
Actual (overall) capability is what the customer experiences.
• The process mean changed significantly (p < 0.05).
0.05).
• The process standard deviation was reduced significantly (p <
Before: C1 After: C3
Reduction in % Out of Spec
to 29.93%.
% Out of spec was reduced by 66% from 88.14%
Was the process standard deviation reduced?
Did the process mean change?
Actual (Overall) Capability
Are the data below the limit?
Comments
Before/After Capability Comparison for C1 vs C3
Summary Report

23. Define
23
Pilot Plan
C1 33 49.796 13.628 36.199
C3 33 5.1889 3.4982 3.4399
Stage N Mean StDev(Within) StDev(Overall)
Yes No
0 0.05 0.1 > 0.5
P < 0.001
Yes No
0 0.05 0.1 > 0.5
P < 0.001
Consider whether these changes have practical implications.
the shift is an improvement.
• The mean is significantly lower (p < 0.05). Make sure the direction of
• The standard deviation was reduced by 74.3% (p < 0.05).
deviation or mean changed:
After a process change, you may want to test whether the standard
100
50
0
IndividualValue
_
X=5.2
UCL=15.7
LCL=-5.3
C1 C3
645750433629221581
100
50
0
MovingRange
__
MR=3.9
UCL=12.9
LCL=0
Was the process standard deviation reduced?
Did the process mean change?
Comments
StDev(Within)
Control limits use
Before/After I-MR Chart of C1 vs C3
Summary Report

24. Define
RACI Analysis for Prioritized Solution Implementation
24

25. Define
Future Process map
CFA
Accountant
State
A/P
State
CFO
Facilities
Office
Places
information
into Cardinal
Pays
Vendor/Files
Invoice
F/S
Budget
Analyst
Creates Final Packet
for CFO Signature
Certifies Packet
PO Approves
Contract/ Codes
Invoices
Green (CVA); Amber (NVA-R); Red (NVA)
Sends
Invoices
Lines up
State/Fed
Funding
Federal
Account
Manager
Certifies Packet
Delay if no
Credit Card

26. Define
Future Process Map continued
GOR
Commercial
Accounts
USPFO
Comptroller
Certifies Packet
Reviews Packet
For Correctness
Green (CVA); Amber (NVA-R); Red (NVA)
Processed For
Payment
Release Of Funds
To State

27. Define
27
• Risk: lack of approved SOPs
• Consequence: staff turn over causes
confusion
• Mitigation: Conduct quarterly processes
reviews
• Risk: CFA Accountant has higher priorities
• Consequence: CA process slows down
• Mitigation: Any invoice older than 15
days in GEARs gets a full team review
Consequence
Likelihood
1
2
3
4
5
1 2 3 4 5
Implementation Risk Analysis & Mitigation Plan

28. Define
Revised Process Documentation
SOPs Requiring Revision Responsible Status
FMO Procurement SOP FMO Office Under Revision
CFA Accountant CFA Under Revision
Required Training Responsible Frequency Status
Fed/State Budget
Analyst
State
CFO/USPFO/GOR
Under Review
FMO Office State
CFO/USPFO/GOR
Under Review
CFA Accountant State
CFO/USPFO/GOR
Under Review
New or Current SOPs Requiring Revision
Required New & Recurring Training
28

29. Define
Plan for Transition to Process Owner
R = Responsible – The person who performs the action/task.
A = Accountable – The person who is held accountable that the action/task is completed.
C = Consulted – The person(s) who is consulted before performing the action/task.
I = Informed – The person(s) who is informed after performing the action/task.
Step Action/Task Responsible Accountable Consulted Informed
1
Begin utilizing automated electronic
transmittal form FMO Deputy CFMO GOR PFO
2 Decision Tree given to process owners Deputy CFMO CFMO FMO PFO
3 Checklist attached to invoices if applicable FMO Deputy CFMO GOR PFO
RACI CHART
29

30. Define
Process Control Tool
3030

31. Define
Goal Achievement
 The Solution Achieved the Project Goals
Project Goals
 Operational:
 Reduce the possibility of late invoices to a maximum of 10%
 Increased cash flow to the State
 Financial: Reduced the average cost per invoice/packet thru processing time
 Total Financial Benefit (Savings) Projected IAW LSS Guidebook, Section 8:
 The Solutions are Being Implemented
 The solution was approved 1 May 18 with implementation slated for 1 June 18
 New/Improved Process Capability will be determined after
implementation
FY18 FY19 FY20 FY21 FY22 Total
$23.3k $23.5k $23.7k $24.2k $24.7k $119.5k
31

32. Define
Final Financial & Operational Benefits
 Financial benefits
 Assumptions:
 Average cost per man hour is $28.84 (2016/2017 Budget)
 Required Data Elements - PowerSteering
• MDEP QRPA
• APE 132G78
• APN NGPA
• ROC 18A
32
ASA(FM&C) Army LSS Financial Guidebook Version 7.0

33. Define
Completed Storyboard
33
 Problem statement
It takes the VAARNG too
long to reimburse the state
of Virginia money owed in
accordance with Cooperative
Agreements. The current
process takes in excess of
60 days.
 Goal statement
Reduce reimbursement time
by 30 days from the time
Virginia incurs an expense
until restitution is made.
Invoices
Re’cvd
State A/P
Pays
Invoice
CFA
creates
Packet
BA
Aligns
Money
State
CFO
Signs
Fed PM
Signs
GOR
Signs
USPFO
Signs
-3
-2
-1
0
1
2
0 50 100 150
Normal Probablity Plot
3128252219161310741
100
75
50
25
0
Observation
IndividualValue
_
X=49.8
UCL=90.7
LCL=8.9
3128252219161310741
100
75
50
25
0
Observation
MovingRange
__
MR=15.4
UCL=50.2
LCL=0
1111
11
111
1
1
1
1
I-MR Chart of PCT
1501209060300
LSL *
Target *
USL 15
Sample Mean 49.7961
Sample N 33
Shape 1.35935
Scale 54.2858
Process Data
Pp *
PPL *
PPU -0.33
Ppk -0.33
Overall Capability
PPM < LSL *
PPM > USL 878787.88
PPM Total 878787.88
Observed Performance
PPM < LSL *
PPM > USL 840255.43
PPM Total 840255.43
Exp. Overall Performance
USL
Process Capability Report for PCT
Calculations Based on Weibull Distribution Model
DEFINE MEASURE
ANALYZE
IMPROVE
CONTROL
Increased
reimbursement thru-
put from a single
packet @ 49 days to
invoices every 5
days