activity based—solutions the journey
DESCRIPTION
Activity Based—Solutions The Journey. Program Support Group May 09, 2001. Program Support Journey. Initial Activity Analysis and ABC Model Development What can this be used for? Examples/Illustrations FY 2000/2001 ABC Update and Calibration Deploy ABM - PowerPoint PPT PresentationTRANSCRIPT
Program Support AB—The Journey2001 Lenhardt & Colton, LLC
Activity Based—SolutionsActivity Based—SolutionsThe JourneyThe Journey
Program Support Group
May 09, 2001
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 2
May 09, 2001
Program Support JourneyProgram Support Journey
Initial Activity Analysis and ABC Model Development
What can this be used for? Examples/Illustrations
FY 2000/2001 ABC Update and Calibration Deploy ABM Institutionalize—and Get Ready for ABB
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 3
May 09, 2001
Reduce Cycle Time
ReduceCost
ImproveQuality
Increase Levelof
Service
Why deploy Activity-based? Why deploy Activity-based?
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 4
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Activity-based info helps you decide. . .Activity-based info helps you decide. . .
. . . what to do differently.. . . what to do differently.
Program Support AB—Solutions
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Program Support AB—Solutions
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Information isData
Endowed withRelevance
andPurpose.
Peter Drucker, 1990
You Need Good InformationYou Need Good Information
Program Support AB—Solutions
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Mn/DOT’s PurposeMn/DOT’s Purpose
Identify Cost, Quality, & Timeliness (CQT)
Manage CQTMeasure CQT
Program Support AB—Solutions
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Relevant InformationRelevant Information
Is ActionableIs TimelyIs Available to those doing the workIs expressed in the same language
as workImparts an understanding of causes
of activities/costs
Program Support AB—Solutions
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Traditional Information…Traditional Information…
Description Plan Actual VarianceSalaries & Benefits 500$ 575$ (75)$ Supplies 20 25 (5) Depreciation 50 45 5 Building Occupancy 25 25 - Utilities 75 85 (10) Transfers 50 60 (10) Total 720$ 815$ (95)$
Is not relevant to the purpose of identifying, Is not relevant to the purpose of identifying, managing and measuring CQTmanaging and measuring CQT
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 10
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Traditional versus Activity-based Traditional versus Activity-based
Project ManagementProject Management
Performance MeasuresPerformance Measures
Workload RequirementsWorkload Requirements
IWS Activities Plan ActualVarianceIssue Permits 245$ Inspect Plants 125 Monitor Users 60 Respond to Spills 125 Attend Meetings 180 Collect Fees 80 Total 815$
IWS Activities Plan ActualVarianceIssue Permits 245$ Inspect Plants 125 Monitor Users 60 Respond to Spills 125 Attend Meetings 180 Collect Fees 80 Total 815$
Focus on ActivitiesAnd Outputs!
Causes!!
Description Plan ActualVarianceSalaries 575.02$ Supplies 25.38$ Depreciation 44.72$ Building Occupancy 25.00$ Utilities 84.55$ Transfers 60.00$ Total 814.67$
Description Plan ActualVarianceSalaries 575.02$ Supplies 25.38$ Depreciation 44.72$ Building Occupancy 25.00$ Utilities 84.55$ Transfers 60.00$ Total 814.67$
Do Not Focus Solelyon ResourcesVariance
Program Support AB—Solutions
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Input OutputActivity
Resource $
An Activity-Based ApproachAn Activity-Based Approach
Exploits the “Process Model” of Work
Program Support AB—Solutions
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Activity Based BudgetingActivity Based Budgeting
How many dollars do I need?
Activity Based Budgeting
Activity Based ManagementActivity Based Management
How well are we doing?
Activity Based Performance
Measures
How/where can I best improve the
process?
Activity Based Continuous
Improvement
Activity Based—SolutionsActivity Based—Solutions
ActivitiesActivities
Activities Outputs
Resources
Activity Analysis
Inputs
Activity Based CostingActivity Based Costing
How much does something cost?
Activity Based Costing
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 13
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Activity Based—SolutionsActivity Based—Solutions
ActivitiesActivities
Activities Outputs
Resources
Activity Analysis
Inputs
Activity Based Costing
The tracing and allocation of costs to products & services via the activities & processes consumed by the products and services.
Activity Based Costing
The tracing and allocation of costs to products & services via the activities & processes consumed by the products and services.
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 14
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Program Support JourneyProgram Support Journey
Initial Activity Analysis and ABC Model Development
FY 2000/2001 ABC Update and Calibration
Deploy ABM Institutionalize—and Get Ready for ABBWhere is it all taking
you?—Examples/Illustrations
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 15
May 09, 2001
Initial Activity Analysis and ABC Model DevelopmentInitial Activity Analysis and ABC Model Development
ES TS CC LM BS BO MR TE AT IM EC CM MDS
1 Pre-Kickoff Conference2 Office Kickoff Meeting
Office Process Analysis3 Identify Office Demands (Outputs)
4 Identify Office Activities
5 Define Output Normalization Criteria
6 Identify Office Resources & Utilization
7 Define Office Data RequirementsCollect Office Data
8 Collect Output Quantities
9 Validate Office Org Structure
10 Complete Crosswalk TablesBuild the Model in NetProphet
11 Draw the Initial Model Schematic
12 Hold Initial Office Modeling Meeting
13 Input Initial Model Boxes & Links
14 Input the Initial Model Factors
15 Identify & Resolve Modeling Issues
16 Import Dollar Data from Crosswalks17 Validate the Model18 Prepare Office Summary
Project Task
Program Support Offices
Program Support AB—Solutions
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ABC Operational Model
Crosswalks
Mn/DOT Computer Databases
ABC Dollarized Model
Much has been accomplished!Much has been accomplished!
Activity Analysis
Input OutputActivity
Resource $
Activity DictionaryResource Tracing
WorkbookNormalization
Workbook
Factors WorkbookSchematics
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 17
May 09, 2001
Program Support JourneyProgram Support Journey
Initial Activity Analysis and ABC Model Development
What can this be used for? Examples/Illustrations
FY 2000/2001 ABC Update and Calibration Deploy ABM Institutionalize—and Get Ready for ABB
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 18
May 09, 2001
Activity-based ExamplesActivity-based Examples
ABC Data
Activity-based Cost Estimate
Activity-based Service
Agreement
Activity-based Budget
Scenarios—Net Prophet II
Activity-based Continuous
Improvement
Program Support AB—Solutions
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Activity-based Cost EstimateActivity-based Cost Estimate
What are you costing? What activity outputs does it consume? Are the outputs normalized? Which variety
is consumed? How many are consumed?
Use an Activity-based cost estimating worksheet to quickly obtain your answer.
Program Support AB—Solutions
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May 09, 2001
Activity-based cost estimating worksheetActivity-based cost estimating worksheetSign Shop Cost Estimate for: One 30 inch Stop Sign
Primary ActivityNormalization
CriteriaComplexity
FactorActual
QuantityNormalized Quantity
Hours perOutput
ExtendedHours
Cost Per Output
Extended Cost
OCM-29Prepare Production Work
OrderNot Normalized 1.000x 1 1.000 1.4994 1.499 Hours $65.000 $65
OCM-30Pull Parts from Stock
Not Normalized 1.000x 2 2.000 0.0077 0.015 Hours $0.375 $1
2.000x 1 2.000 0.0195 0.039 Hours $1.210 $2
OCM-32Apply Legends to Signs
3.000x 1 3.000 0.0344 0.103 Hours $1.550 $5
OCM-33Assemble Sign
ComponentsNot Normalized 1.000x 1 1.000 0.0845 0.085 Hours $5.055 $5
OCM-34Prepare Sign Order
for DeliveryNot Normalized 1.000x 1 1.000 0.0800 0.080 Hours $0.400 $0
GRAND TOTAL 0.322 Hours $13
OCM-31Apply Sheeting to Blanks
Sign > 36" X 36"
Requires Screening
Requires Cutting
Used Sign Blank
Squeeze Roller
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 21
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Activity-based Service AgreementActivity-based Service Agreement
What are you costing, for which district? How many outputs are consumed by that
district? What is your negotiated cost-per-output with that
district?
Use an Activity-based service agreement worksheet to quickly obtain your answer.
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 22
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AB Service Agreement WorksheetAB Service Agreement Worksheet
FY 2001 Cost per Normal Output =>
$4,180
PropertyDescription
Total or Partial Take
Type of Acquisition
Value of Property
ComplexityFactor
Weighted Cost per Acquisition
Estimated # of FY2001
Acquisitions
Estimated Cost of FY2001
Acquisitions
Normalization Criteria
Fiscal Year: 2001
Customer: MetroLand Management
Service Agreement Estimate
Activity: Purchase Real Estate
Narrative Partial Take Eminent Domain $10K-$200K 2.13X $8,903 4 $35,612
Narrative Partial Take Eminent Domain >$200K 3.88X $16,218 1 $16,218
Total 202 $1,632,885
Program Support AB—Solutions
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Activity-based BudgetActivity-based Budget
What is the projected workload, expressed in terms of activity outputs?
What is the forecasted cost per output?
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 24
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AB Budget WorksheetAB Budget Worksheet
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 25
May 09, 2001
Program Support JourneyProgram Support Journey
Initial Activity Analysis and ABC Model Development
What can this be used for? Examples/Illustrations
FY 2000/2001 ABC Update and Calibration Deploy ABM Institutionalize—and Get Ready for ABB
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 26
May 09, 2001Update and Calibrate for FY2000/2001Update and Calibrate for FY2000/2001
Program Support AB—Solutions
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Process to Maintain DocumentationProcess to Maintain Documentation
From the Modelers’ Meetings 1 and 2.
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 28
May 09, 2001
Program Support JourneyProgram Support Journey
Initial Activity Analysis and ABC Model Development
What can this be used for? Examples/Illustrations
FY 2000/2001 ABC Update and Calibration Deploy ABM Institutionalize—and Get Ready for ABB
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 29
May 09, 2001
Activity Based ManagementA formal management process that
supports excellence:1. Encourages an understanding of
how activities and processes contribute to the strategic objectives of the organization.
2. Encourages changes to traditional management. practices to emulate best practices and establish process controls to ensure consistently good performance.
3. Enables a systematic process of continual process improvement, allowing organizational improvement to be planned, budgeted, monitored and controlled.
Activity Based ManagementA formal management process that
supports excellence:1. Encourages an understanding of
how activities and processes contribute to the strategic objectives of the organization.
2. Encourages changes to traditional management. practices to emulate best practices and establish process controls to ensure consistently good performance.
3. Enables a systematic process of continual process improvement, allowing organizational improvement to be planned, budgeted, monitored and controlled.
Activity Based—SolutionsActivity Based—Solutions
ActivitiesActivities
Activities Outputs
Resources
Activity Analysis
Inputs
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 30
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Continuous Improvement. . . Continuous Improvement. . .
Program Support AB—Solutions
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Deploy ABMDeploy ABM
Program Support AB—Solutions
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““Deploy ABM” ProcessDeploy ABM” Process
A. Elements of ABM
B. Plan the ABM Rollout
C. Internalize the Vision
D. Execute First Cycle of ABM
E. Assess the Execution of ABM
F. Institutionalize the Process of ABM
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 33
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Activity Based Continuous ImprovementActivity Based Continuous Improvement
Problem? Solution!
How/where can I best improve the process?
Activity Based Continuous
Improvement
Eliminate wasteful (non-value added) activities Optimize resources by continuously improving
value-added activities Use activities/outputs to link all management
tools
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 34
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Establish “Value” Definitions—ExamplesEstablish “Value” Definitions—Examples
An activity could be considered value added (VA) if:
An activity could be considered non-value added (NVA) if:
It is required to meet external customer requirements.
It can be eliminated without impacting the form, fit or
function of the product.
It is required by the government or other regulatory
agency.It involves rework or inspection.
It modifies or enhances the raw materials of our
product.It results in waste and adds no value to product or
service.
The customer is willing to pay for the incremental value
added.It is performed due to inefficiency in the upstream
process.
It is a critical step that cannot be eliminated in a
business process.It is duplicated in another department or adds unnecessary steps to the process.
It is performed to resolve or eliminate a quality
problem.It is performed to monitor quality problems.
It is performed due to a request or expectation of a
happy customer.It is performed due to a request from an unhappy
customer.
It produces a valuable output.
It produces unnecessary or unwanted output.
Program Support AB—Solutions
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Quality Tools for ImprovementQuality Tools for Improvement
ToolPlanningAnalysis
Prioritize &
InterpretTeamingPersonal
Brainstorming X X X
Storyboard (Affinity Diagram) X X X
Matrix Diagram X X
Root Cause Analysis X X
Fishbone Chart (Cause/Effect) X X
Criteria Rating X X X
Data Sheets X X X
Tree Chart X X
Pareto Chart X X
Sequence Flow Chart X X X X
Process Flow Chart X X X X
Scatterbrain Diagram X X
Control Chart X X X
Histograms X X X X
Task
Program Support AB—Solutions
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Where to start?Where to start?
Scenario: Improve ProcessScenario: Improve Process
You’ve been given a 10% productivity goal.
Program Support AB—Solutions
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Generate a listGenerate a list
To define the opportunity, start by listing some of the visible adverse symptoms, or “effects” of some underlying problems within your workgroup– The visible signs of underlying problems
generally are symptomatic of a deeper problem
– Your goal is to brainstorm some of the effects, then work backward to determine the root cause
Program Support AB—Solutions
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Remember Your Activity Analysis?Remember Your Activity Analysis?
Program Support AB—Solutions
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Link Adverse Effects to ActivitiesLink Adverse Effects to Activities
Program Support AB—Solutions
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Estimate the Impact (ROM)Estimate the Impact (ROM)
Let’s investigate this one.
Program Support AB—Solutions
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Determine Root CauseDetermine Root Cause
Some Quality Tools to Identify Root Cause– Brainstorming– Cause and effect diagrams– Data Collection (Check sheets) and
Analysis– Pareto Analysis– “Five Why’s” approach
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 42
May 09, 2001
Fishbone (Cause/Effect) “Tool”Fishbone (Cause/Effect) “Tool”
Project:
Reduce Unplanned Changes
Reason Selected:
Initial Cost Driver analysis showed that unplanned changes causes close to $ 650 thousand of recurring activity cost.
PeoplePeople
PoliciesPolicies
ProcedureProcedure
SystemsSystems
Analysis
Cause of unplanned changes?
Cause of unplanned changes?
Lack of training
Customer makes changes
Policies inadequate
Procedure not being followed
Inadequate tracking & communicationtools
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 43
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Data Collection/AnalysisData Collection/AnalysisData Collection: Checksheet
Reason> Date Customer Change
Inadequate Procedure
No Communication Other Total
12-Aug ✔✔✔✔✔ ✔✔ ✔ ✔ 919-Aug ✔✔✔ ✔ ✔ 526-Aug ✔✔✔✔✔✔ ✔✔✔ ✔✔ ✔ 122-Sep ✔✔✔ ✔ ✔ 59-Sep ✔✔✔✔ ✔✔✔✔ ✔ ✔ 1016-Sep ✔✔✔ ✔✔ ✔ ✔ 7
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 44
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Idea
IdeaIdea
Idea
IdeaIdea
Idea
IdeaIdea
Idea
Idea
Affinity Diagram
Prohibit Changes Hold Monthly Review
Design CollaborativeGoals with Incentives
Other
Identify Possible SolutionsIdentify Possible Solutions
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 45
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Prioritize Possible SolutionsPrioritize Possible Solutions
Solution Alternative>> Alternative 1 Alternative 2 Alternative 3Decision Criteria Weight Rank Score Rank Score Rank ScoreCost of Solution 20% 1 0.2 4 0.8 6 1.2Effectiveness of Solution 40% 10 4 7 2.8 9 3.6Probability of Success 20% 1 0.2 5 1 7 1.4Resistance 10% 1 0.1 6 0.6 6 0.6Ease of Implementation 10% 4 0.4 7 0.7 5 0.5Total 100% 4.9 5.9 7.3
Rank 10 = Most Favorable 1 = Least Favorable
Alternatives1 Prohibit changes altogether.2 Hold monthly meetings with customers, systems design and software design
to discuss changes, change impact and forecasted changes.3 Sponsor a Customer Communication event. Communicate issue, share results of
cost analysis, propose collaborative arrangement to jointly determine and reduce thenumber of unplanned changes. Develop a proposed incentive/reinforcement plan to increase effectiveness.
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 46
May 09, 2001
Trace Improvement to Primary ActivitiesTrace Improvement to Primary Activities
No. Primary Activity
Base Total Cost
TS1 Produce a PS&E Package $1,360 k
TS2 Provide OTS expertise $1,427 k
TS3 Prepare muni/utility agreements/permits $926 k
TS4 Manage consultant contract process $916 k
TS5 Develop customized software/systems $2,953 k
TS6 Develop/design final project plans/guides $506 k
TS7 Design and deliver OTS Training Events $680 k
TS8 Prepare and distribute PS reports $813 k
TS10 Publish and update stds. & specs. $568 k
$10,149 k
Base Unit Cost
Projected Total Cost
$3,417 $1,224 k
$46 $1,356 k
$785 $926 k
$860 $916 k
$55,717 $2,510 k
$42,167 $506 k
$12,593 $680 k
$2,180 $813 k
$3,665 $568 k
$9,499 k
Projected Unit Cost
$3,075
$44
$785
$860
$47,358
$42,167
$12,593
$2,180
$3,665
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 47
May 09, 2001
Monitor the ImprovementMonitor the Improvement
Pareto Diagram
0
5
10
15
20
25
A B C D
Reason for Unplanned Changes
Frequency of Occurrence
0.0%
20.0%
40.0%
60.0%
80.0%
100.0%
Diagram - After 6 Months
0
5
10
15
20
25
B C D A
Reason for Unplanned Changes
Frequency of Occurence
0.0%
20.0%
40.0%
60.0%
80.0%
100.0%
Average Monthly Unplanned Changes
0
5
10
15
20
25
30
35
Baseline Month 1 Month 2 Month 3 Month 4 Month 5 Month 6
# Changes Per Month
Great Job!!
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 48
May 09, 2001
ABM - A Systematic Process ABM - A Systematic Process
Identify improvement opportunities
Develop action plans
Implement & Evaluate
Improve Processes
Cost, Quality, Time (CQT)
Evaluate Performance
Input OutputActivity
Resource $Assign Resources
to achieve Performance
Budgeting
PL
AN
DO
CH
EC
K
ACT
AC
T
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 49
May 09, 2001
A New A New FocusFocus
Program Support AB—Solutions
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How do you get there?How do you get there?
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 51
May 09, 2001
Deploy ABM in Program SupportDeploy ABM in Program Support
A. Elements of ABMB. Plan the ABM RolloutC. Internalize the VisionD. Execute First Cycle of ABME. Assess the Execution of ABMF. Institutionalize the Process of ABM
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 52
May 09, 2001
Planning the ABM RolloutPlanning the ABM Rollout
Identify and/or refine project goals & objectives Create project “scoreboard” to keep project focus
– Predetermined success criteria Identify project sponsor
– Provide “roadmap”, suggesting active leadership role for sponsor to carry out
Recruit steering team and ABM project teams– Provide clear guidelines
Develop and gain approval for project plan and key milestones Communicate plan as part of overall ABM communications
effort
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 53
May 09, 2001
Deploy ABM in Program SupportDeploy ABM in Program Support
A. Elements of ABMB. Plan the ABM RolloutC. Internalize the VisionD. Execute First Cycle of ABME. Assess the Execution of ABMF. Institutionalize the Process of ABM
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 54
May 09, 2001
Internalize the VisionInternalize the Vision
Educate managers and employees to obtain:
– Buy-in– Commitment– Participation
Create the environment in which ABM can succeed– Communications– Rewards & recognition– Trust
Educate managers and employees to obtain:
– Buy-in– Commitment– Participation
Create the environment in which ABM can succeed– Communications– Rewards & recognition– Trust
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 55
May 09, 2001
Deploy ABM in Program SupportDeploy ABM in Program Support
A. Elements of ABMB. Plan the ABM RolloutC. Internalize the VisionD. Execute First Cycle of ABME. Assess the Execution of ABMF. Institutionalize the Process of ABM
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 56
May 09, 2001
Execute First Cycle of ABMExecute First Cycle of ABM
Ya’ll fired!
Identify improvement opportunities Determine root cause, possible solutions Prioritize, recommend plan Coordinate with business planning Develop CQT performance
measures.
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 57
May 09, 2001
Deploy ABM in Program SupportDeploy ABM in Program Support
A. Elements of ABMB. Plan the ABM RolloutC. Internalize the VisionD. Execute First Cycle of ABME. Assess the Execution of ABMF. Institutionalize the Process of ABM
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 58
May 09, 2001
Assess the Execution of ABMAssess the Execution of ABM
Summarize results Assess results vs. success factors Present findings to steering team Identify and charter process improvement
teams as appropriate Hold periodic follow-up meetings to
evaluate progress Determine next steps
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 59
May 09, 2001
Deploy ABM in Program SupportDeploy ABM in Program Support
A. Elements of ABMB. Plan the ABM RolloutC. Internalize the VisionD. Execute First Cycle of ABME. Assess the Execution of ABMF. Institutionalize the Process of ABM
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 60
May 09, 2001
Institutionalize the Process of ABMInstitutionalize the Process of ABM
Create/refine “ABM Process” dictionary
Establish and train “ABM Process-owners” within each office
Plan (with ABM process-owner teams) execution of ABM Cycle 2
Coach office teams during Cycle 2
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 61
May 09, 2001
Pitfalls to AvoidPitfalls to Avoid
Lack of Top Management Buy-In Project Perceived as Just Another
“Accounting Project” Lack of Absolutely Clear Goals & Objectives Insufficient Resources Committed to the
Project Resistance to Change- Individual &
Institutional Lack of Long-Term Vision Regarding the Role
of ABM
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 62
May 09, 2001
Program Support JourneyProgram Support Journey
Initial Activity Analysis and ABC Model Development
What can this be used for? Examples/Illustrations
FY 2000/2001 ABC Update and Calibration Deploy ABM Institutionalize—and Get Ready for ABB
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 63
May 09, 2001
Activity Based Budgeting
The process of planning and controlling the expected activities or business processes of the organization to derive a cost-effective budget that meets forecasted workload and agreed strategic goals.
Activity Based Budgeting
The process of planning and controlling the expected activities or business processes of the organization to derive a cost-effective budget that meets forecasted workload and agreed strategic goals.
Activity Based—SolutionsActivity Based—Solutions
ActivitiesActivities
Activities Outputs
Resources
Activity Analysis
Inputs
Program Support AB—Solutions
2001 Lenhardt & Colton, LLC Slide 64
May 09, 2001
ABB—Getting ReadyABB—Getting Ready
Update and Calibrate Process Definitions and Models– Activity Definitions– Normalization Factors– Resource Tracing
Develop Simple Output tracking methods Maintain and update the Process
Documentation Set Make “Process Understanding and Definition” a
regular part of your business meetings