Falcon Invoice Discounting: Empowering Your Business Growth
Value added property management
1. NPMA Federal Center Chapter - Aug. 2011
Presented by: Don Miller
General Manager, Olgoonik Management Services
2. “Value Added Property
Management” - What is it?
Sounds good – what is it?
Value added refers to "extra" feature(s) of an item of
interest (product, service, person, etc.) that go beyond
the standard expectations and provide something
"more" while adding little or nothing to its cost.
(Source: Wiki)
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3. Property or Assets?
Assets: An asset is a resource controlled by the
entity as a result of past events and from which future
economic benefits are expected to flow to the entity.
Property: A piece of real estate: has a swimming pool
on the property. c. Something tangible or intangible to
which its owner has legal title:
Something owned; a possession
The right of ownership; title
(Source: Google / Wiki)
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4. Federal Definitions (FMR)
General PP&E (Property, Plant & Equipment)
1. General PP&E consists of tangible assets that meet all of
the following criteria:
a. have an estimated useful life of two years or more;
b. are not intended for sale in the ordinary course of operations;
c. are acquired or constructed with the intention of being used
or being available for use by the entity; and,
d. have an initial acquisition cost, book value, or when
applicable, an estimated fair market value … that equals, or
exceeds, DoD capitalization threshold. The DoD
capitalization threshold is $100,000, except for real property
assets. The threshold for real property assets is $20,000.
Source: DoD Financial Management Regulation 7000.14-R
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5. General PP&E also includes:
a. assets acquired through capital leases, including leasehold
improvements (see paragraph 060206 of this chapter);
b. property under the accountability of the reporting entity even
though it may be in the possession of others (e.g., state and
local governments, colleges and universities, or contractors);
c. land, other than Stewardship Land, with an identifiable cost
that was specifically acquired for, or in connection with, the
construction of General PP&E; and,
d. land rights, which are interests and privileges held by an
entity in land owned by others, such as
leaseholds, easements, water and water power
rights, diversion rights, submersion rights, rights-of-
way, mineral rights and other like interests in land.
Source: DoD Financial Management Regulation 7000.14-R
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6. General PP&E examples:
a. Real Property including Land, Land Rights, and
Facilities (includes Buildings, Structures, and Linear
Structures)
b. Construction in Progress
c. General Equipment
d. Assets Under Capital Lease
e. Leasehold Improvements
f. Internal Use Software
g. Military Equipment
Source: DoD Financial Management Regulation 7000.14-R
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7. The Federal Acquisition Regulation
52-245-1
Property management.
(1) The Contractor shall have a system to manage (control, use, preserve, protect, repair
and maintain) Government property in its possession. The system shall be adequate to
satisfy the requirements of this clause. In doing so, the Contractor shall initiate and
maintain the processes, systems, procedures, records, and methodologies necessary for
effective control of Government property, consistent with voluntary consensus
standards and/or industry-leading practices and standards for Government
property management except where inconsistent with law or regulation. During the
period of performance, the Contractor shall disclose any significant changes to their
property management system to the Property Administrator prior to implementation.
(2) The Contractor’s responsibility extends from the initial acquisition and receipt of
property, through stewardship, custody, and use until formally relieved of responsibility
by authorized means, including delivery, consumption, expending, sale (as surplus
property) or other disposition, or via a completed investigation, evaluation and final
determination for lost, stolen, damaged, or destroyed property. This requirement applies
to all Government property under the Contractor’s accountability, stewardship,
possession or control, including its vendors or subcontractors (see paragraph (f)(1)(v) of
this clause).
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8. Why do we Manage Property?
XX Regulatory requirement
We don't want our property to become “lovely parting gifts”
for employees
SOX requires some property tracking
Tax laws require tracking
Government regulations require tracking
DoD, DHS, NASA, etc.
The FAR requires tracking
Does the theme sound like “Cause we have to?”
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9. The Problem…
If the fundamental reason your organization is
managing property is to satisfy a regulatory or policing
requirement – they are only going to provide the
lowest amount of resources required to achieve the
minimum acceptable levels of performance.
Why is this?
They don’t see property management as having a pay
back to the mission or their bottom line.
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10. The Solution…
Demonstrate the “Value Added”
If you Google “value added property management” the
first page is all about real property, page two has one
entry on intellectual property, and one entry on NPMA
Property Management and then more real property…
How do we improve recognition of the inherent
value we add as property managers?
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11. What do we add?
Potential to reuse property rather than disposal
Opportunity to improve utilization of idle equipment
Identify costs of maintaining idle equipment and
property in storage
Possibility to reallocate property to meet contingency
needs
Keep property from becoming lost, damaged or
destroyed
Life Cycle Management helps program when
replacements are required and when to program funds
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12. Winning Over Management
Managers at all levels have to “see” the benefits
We have to guide and educate them
We have to take the opportunity to “show” how good
property management and accounting improves their
ability to be:
Responsive
Proactive
Good Stewards
Innovative
Gain more resources (time, money, people and materials)
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13. Our Tools – ASTM Standards
E2131-09 Standard Practice for Assessing Loss, Damage, or Destruction of Property
E2132-01(2007) Standard Practice for Physical Inventory of Durable, Moveable Property
E2135-10a Standard Terminology for Property and Asset Management
E2279-09 Standard Practice for Establishing the Guiding Principles of Property Management
E2306-11 Standard Practice for Disposal of Personal Property
E2379-09 Standard Practice for Property Management for Career Development and Training
E2452-10 Standard Practice for Equipment Management Process Maturity (EMPM) Model
E2453-05 Standard Practice for Determining the Life-Cycle Cost of Ownership of Personal Property
E2495-07 Standard Practice for Prioritizing Asset Resources in Acquisition, Utilization, and Disposition
E2497-06 Standard Practice for Calculation of Equipment Movement Velocity (EMV)
E2499-06 Standard Practice for Classification of Equipment Physical Location Information
E2604-09 Standard Practice for Data Characteristics of Equipment Records
E2605-08 Standard Practice for Receiving Property
E2606-08 Standard Practice for Receipt Notification as a Result of Tangible Property Movement
E2607-08 Standard Practice for Cannibalization/Reclamation of Serviceable Equipment Components to
Support Demand Requirements
E2608-08 Standard Practice for Equipment Control Matrix (ECM)
E2631-09 Standard Practice for Physical Placement of an Entity-Controlled Supplemental Identification
Label
E2671-10 Standard Practice for Defining Movements, Shipments, and Transfers of Tangible Property
E2672-09 Standard Practice for Identification and Categorization of Tooling
E2674-09 Standard Practice for Assessment of Impact of Mobile Data Storage Device (MDSD) Loss
E2675-09 Standard Practice for Property Management System Outcomes
E2676-09 Standard Practice for Tangible Property Mobility Index (MI)
E2715-09 Standard Practice for Moveable Property Storage
E2811-11 Standard Practice for Management of Low Risk Property (LRP)
E2812-11 Standard Practice for Uniform Data Management in Asset Management Records Systems
Source: http://www.astm.org/COMMIT/SUBCOMMIT/E53.htm 13
14. Now What??
We have the tools
We understand the “problem”
We understand the solution
Our Next Steps
Understand your organizational climate
What is important to the organization?
How does property play a part?
How can improved property performance aid the goals?
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15. Example
Big Information Technology Project
Requires new dedicated servers
Requires new software solutions
Requires state of the art developer workstations
Requires new work space
Requires new testing labs
Requires updated training resources
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16. We suggest…
Displaced workstations from developer be used in the
new lab in lieu of buying new – closer to our current
baseline of systems. (Potential to reuse property rather than
disposal)
Coordinate direct delivery and concurrent property in-
processing to limit impact on setup and development.
(Keep property from becoming lost, damaged or destroyed)
Property in storage can meet the requirements to
outfit the labs and training areas (Identify [reduce] costs of
maintaining idle equipment and property in storage)
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17. Analysis
Information Technology has a huge budget; is a highly
scrutinized function; and, has enormous visibility for
the organization (organizational climate)
We have become part of the solution instead of a
hindrance to progress
We have offered them the opportunity to save money
on some areas allowing them more money to buy IT
“stuff”
We have become “team members” (i.e., value added)
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18. Conclusion
A simple example – but it works at whatever level of
the organization with whom you are working
The IT Project gained additional resources through
cost avoidance
You need to look for the opportunity
Take the lead!
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19. Questions???
Thank You!
Don Miller
General Manager, Olgoonik Management Services LLC
Tel: Office: 703-312-0080 Mobile 703-509-3255
Email: dmiller@olgoonik.com
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