Introduction/Background
|
Contractor |
DOE Office |
|
|
| Submitted By: |
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| Cognizant DOE Office: |
|
| Date of Last Self-Assessment: | August 2000 |
| Status Of Purchasing System: | Approved |
| Effective Date Of Approval: | December 20, 1999 |
| Thresholds For DOE Approval: |
|
| Assessment Team
Members: |
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| Legal Advisor: | Ms. Rachel Claus, SLAC Staff Counsel |
| Participants: |
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B.
BALANCED SCORE CARD SELF ASSESSMENT PROGRAM
1. General
The SLAC Purchasing Department Self Assessment was
conducted in accordance with the SLAC 2001 Balanced Score Card Self Assessment
Plan, dated August 1, 2000, and submitted to the DOE Oakland Operations Office.
2.
Purchasing Organization
SLAC Purchasing is organized as depicted in the
Organization Chart (see
Exhibit
I).
Effective January 1, 2001, the following organizational
changes were implemented:
A Level II Buyer was assigned 50% time to the Construction Group for training, support, and long term succession planning.
An Administrative Assistant was assigned to the Purchase Card/Job Shoppers Program for training, backup support, and long term succession planning.
The Green Purchasing Program was established consisting of three seniors and one junior buyer. Their goal was set to maximize the purchase and use of recycled products at the laboratory as much as possible.
Two Administrative Assistants were delegated additional responsibilities in the Business Information System Support group for training and backup support.
A Level III Buyer was assigned part time to the Small Business Subcontracting Program to assist the Purchasing Officer in the administration of the activities in this area.
Effective May 15, 2001, a new
Deputy Associate Purchasing Officer position was created as a result of the
elimination of two supervisory positions from the Inventory Management group and
the Shipping and Receiving group.
Effective
July 1, 2001, an E-Commerce group was established within Purchasing to direct
the department in moving to an electronic paperless environment by a go live
date of November 2002.
3.
Status of Open Items From The 2000 Self-Assessment Review
(None)
4.
Participation In General
SLAC
Purchasing participated with the other DOE Office of Science laboratories to
discuss common issues and exchange information. Meetings were attended in
October 2000 and May 2001. Concurrent
with attendance at the above stated meetings, we also attended the October 2000
DOE Contractors Purchasing Managers Symposia and Workshops in New York City,
5.
Independent Peer Review
A Peer Review of SLAC’S Business Services functions was held at the laboratory from July 18 through July 20, 2001. Peer Review members were drawn from five national laboratories along with the Contracting Officer from the DOE Oakland Operations Office. SLAC asked the review panel to evaluate each administrative service (including the Purchasing Department) utilizing the following criteria:
Is each area pursuing high quality standards through the use of relevant performance-based criteria?
Are the service functions pursuing their missions in a cost effective and efficient manner;
Are the service functions aligned with the programmatic goals of the laboratory; and
Are the service functions achieving an acceptable level of customer satisfaction?
The peer review included the
review of advanced materials, presentations, and discussions with certain key
individuals. The review of the SLAC Purchasing Department activities is further
discussed under Section 2.2.1 below. The Draft Peer Review report is included as
Exhibit II.
6.
Annual Ethics Training For All Buyers
The
annual Purchasing Ethics Training session was held on September 10, 2001. This
is a mandatory training session for all department professionals involved in the
purchasing function. In addition to reminding buyers of the various University
procedures covering code of conduct, two case studies were handed out for
discussion purposes. One case study concerned the use of SLAC/Government
Resources, and the second case study addressed the issue of Gifts and
Gratuities. A total of 13 buyers and contract administrators attended the
session.
C.
BALANCED SCORECARD REVIEW AND ANALYSIS
1.
Source of Data Used In The Self-Assessment
The principal data generation source for the Four
Perspectives was from the Business Information System (BIS). System data was
collected from the period October 1, 2000 through September 30, 2001.
All other data was obtained through the use of checklists and
questionnaires as discussed later on in this report.
2.
The Four Perspectives
The four
perspectives discussed below were measured as part of the self-assessment
process. Each measurement was rated using the Balanced Score Card Summary Sheet
format.
1.
CUSTOMER:
This perspective captures the ability of the organization to provide
quality goods and services, effective delivery, and overall customer
satisfaction.
2.
INTERNAL:
This perspective provides data regarding the internal business
results against measures that lead to financial success and satisfied customers.
3. FINANCIAL:
How effectively and efficiently SLAC meets the needs of its
constituencies. This perspective captures cost efficiency, delivering maximum
value to the customer for each dollar spent.
4. LEARNING
AND GROWTH: This
perspective captures the ability of employees, information systems, and
organizational alignment to manage the business and adapt to change.
2.1 CUSTOMER
PERSPECTIVE
2.1.1
Transaction Customer Survey
SLAC obtained
its measurement of this perspective from its internal customers (Requestors).
A Transactional Customer Satisfaction Survey was employed via telephone
and in-person interviews in September 2001.
Requestors were asked to respond to a series of statements (see
Exhibit III) pertaining to specific purchase orders. The statements were
based upon the suggested core and optional questions of the “DOE Balanced
Score Card for the Business Systems Performance Measurement and Management
Program” guidebook. Areas assessed were timeliness, quality, communications,
schedule, best value, overall satisfaction, and performance. Recently awarded
purchase orders, randomly selected from the BIS data report, were used for the
survey.
Objective: Customer Satisfaction
Measure: Transactional Survey
Core Elements:
Timeliness - Extent of customer satisfaction with timeliness of procurement processing, planning activities, and on-going communications.
Quality - Extent of customer
satisfaction with the quality of Procurement services.
Communications - Extent to which Purchasing
communicates accurate information, which impacts the work of the organization.
Optional Elements:
Schedule - Extent to which Purchasing is supportive
of schedule requirements.
Best Value - Extent to which Purchasing strives to
obtain the best price.
Overall Satisfaction - Extent of overall customer
satisfaction with Purchasing.
Performance - Extent to which Purchasing is
committed to certain standards.
Target: 95%(national
target) customer satisfaction rating in 2001.
Results:
A rating of 100% (20 points - BSC Measured Rating) was
assigned based upon an analysis of the internal customer questionnaire
responses. There were twenty (21) respondents to the survey whose satisfaction
level was calculated as follows:
4 points Mostly Agree
3 points Agree (deemed as the Satisfactory level for the survey)
2 points Somewhat Disagree
1 point Strongly
Disagree
0 points for No Opinion; and
The number of points for each statement for every respondent was added up; and
We calculated the average rating by dividing the total points by the
number of questions responded to by that respondent; and
We counted the number of satisfied respondents (average rating of 3 or
above) and divided by the total number of respondents to arrive at the
percentage gradient
2.1.2
Peer Review Survey
Follow-up
In March 2001, a follow-up survey was conducted to the Peer Review
Customer survey of August 2000. The Requestor community was asked to respond to
questions regarding the likes and dislikes of the Purchasing department
services, and what improvements should Purchasing consider making.
The results of the survey produced helpful comments on improvements and
bottlenecks. No rating was assigned to this survey.
2.1.3
BIS Web Page Session
Survey
We also checked on the health of our department by holding a business
information system users group session in February 2001. This session was
designed to obtain major users comments and observations of the Business
Information System Web Page. Helpful suggestions and recommendations were the
result of the session that subsequently aided in the re-design of the web page.
2.1.4
Lab Managers Advisory
Group Session
This advisory group (LMAG) was established in April 2001, to improve
communications between the Laboratory’s service providers and the operating
groups that use those services. The purpose of the group is to serve as a
conduit between SLAC’s business and administrative services providers and
their customers. Its overall goal is to improve SLAC’s business processes by
creating an avenue for the timely exchange of information and enabling a dialog
between service providers and service users. In June 2001, the Purchasing
Officer met with the LMAG and discussed the goals and visions of the Purchasing
Department. In addition, the Deputy Associate Purchasing Officer/Materials
Management met with the group to discuss new processes in the Shipping and
Receiving Department.
2.2 INTERNAL
BUSINESS PROCESS PERSPECTIVE
This
perspective assures that customer requirements and expectations are understood
and that appropriate procurement processes are in place to support customer
needs. The self-assessment is the principal data generation or gathering source
for this perspective. The core objectives and measures listed below were used by
Purchasing to monitor its business processes and for the establishment of a
baseline against which future performance will be compared.
2.2.1
Peer Review
As
discussed earlier under Section B. 5, the Peer Review team reviewed the
Purchasing Department’s administrative services processes in terms of how it
serves its customers. Through means of interviews, documentation, and appraisals
supplied by the SLAC customer base, the Review Team was able to proffer its
observations for further beneficial improvements in the Purchasing department.
Overall, the Team found that significant positive changes in departmental
operations and processes had been implemented. They observed that there was a
“positive vision for change” and “exceptionally good cooperation with
regard to its internal communication system.” The Review team also observed
the Procurement Office is working well under a new manager who is clearly
forward thinking and progressive. The interaction between other laboratories and
this office is excellent and good interoffice communication keeps this
department effective. Issues of
timeliness and customer satisfaction are being addressed.” See Section 11 of
the Peer Review Report for further details. Note that the value assigned to the
Purchasing function was “4.1” which carries a rating of Excellent.
2.2.2
Effective Internal Controls
To ensure
compliance with applicable laws, regulations, prime contract terms and
conditions, SLAC policies and procedures, Purchasing conducted its annual review
of procurement transactions the week of September 17, 2001.
The files reviewed consisted of 100 purchase orders randomly selected via
the PeopleSoft system from the period October 1, 2000 through September 1, 2001.
The team reviewed the following files using the Self-Assessment Checklists (See
Exhibits IV and IVa):
Fifty (50) files from $0
-10,000; and
Twenty-five (25) from
$10,000 - $25,000; and
Twenty-five (25) files from
$25,000 and over.
These 100 purchase orders represented $1,902,490, or 4%
of the total value of $47,003,592, for all purchase orders awarded during this
period. The calculation is as follows:
A.
SELECTED SAMPLE
|
|
$0 -
$10,000 |
$10,000 -
$25,000 |
$25,000
and over |
|
50 |
25 |
25 |
|
Total Value |
$1,902,490 |
|
|
B.
UNIVERSE
Total Number of actions in the review sample period was 6553.
Total Value of actions in the review sample period was $47,003,592.
C.
PERCENTAGE
(sample/universe)
Total Number
100/6553 = 2%
Total Value
$1,902,490/$47,003,592 = 4%
The following areas were
designated as a focus for the FY 2001 self-assessment review process:
Purchase Requisition processed timely.
Lead Time (from receipt of
the Purchase Requisition to award of purchase order) under BIS.
Determination of financial and technical responsibility.
Price Analysis adequacy.
Adequacy of sole source justification documentation.
Representations and Certifications properly completed.
Buy American Waiver completed.
Appropriate use of DOE ICPT Agreements and other BOA’s.
Appropriate use of Optional Clauses.
Correct Debarred Listing Citation.
Accuracy of Conflict of Interest listing citation.
Overall adequacy of file documentation.
Objective:
Effective Internal Controls
Measure:
% of systems in full compliance with stakeholder requirements (e.g.
applicable laws, regulations, procedures, terms and conditions of contracts,
ethics, etc.) based on self-assessment.
Target:
Meets or exceeds expectations.
Results:
Of the Purchasing System actions reviewed for compliance with
applicable laws, procurement regulations, SLAC Purchasing procedures, prime
contract terms and conditions and Government and University ethical provisions,
a total average of 90.75% (15 points - BSC Measured Rating) were found to
be compliant.
Narrative
The findings are as follows:
|
Review Topic |
Total Found Compliant |
Per Cent Compliant |
|
1. PR Processed Timely |
83
out of 100 |
83% |
|
2. Lead Time |
80
out of 100 |
80% |
|
3. Financial/Technical Responsibility |
96
out of 100 |
96% |
|
4. Price Analysis Adequacy |
94
out of 100 |
94% |
|
5. Adequate Sole Source Justification |
19
out of 24 |
79% |
|
6. EEO Certification Properly Completed |
16
out of 17 |
94% |
|
7. Buy American Waiver |
2
out of 2 |
100% |
|
8. Use of DOE ICPT Agreements |
6
out of 7 |
86% |
|
9. Debarred Listing Cite |
97
out of 100 |
97% |
|
10. Correct Clause Sets (BIS) |
98
out of 100 |
98% |
|
11. Accuracy of COI citation |
98
out of 100 |
98% |
|
12. Overall adequacy of file documentation |
84
out of 100 |
84% |
|
|
Total
|
1089 |
Total Average of Actions Reviewed Found Compliant (1089/12) = 90.75%
Issues and Corrective Action
(For those actions found to be
less than 95% compliant)
1. Purchase Requisition
Processed Timely
Corrective Action:
With only 83% compliant, Buyer training/reinforcement in untimely
placement of awards is required. We will need to reinforce the need for all
buyers to align themselves with the published lead times. Possible root cause
was lack of management diligence attributable to Purchasing having had an
Associate Purchasing Officer position vacant since January 2001. The position
was recently filled and it is anticipated that increased management attention
will rectify this issue in the future.
Target Completion Date:
November 30, 2001
2. Lead Time For
Processing Procurement Requests (PRs)
Corrective Action:
Compared to FY 2000 results (80%), we believe the 80% rating of
compliance shows little to no improvement. We intend to continue reinforcement
with the Requestor community to be cognizant of Purchasing lead times for
placement of procurements. We plan on doing this by focusing on the major
departments responsible for not providing adequate lead-time when submitting
their Purchase Requisitions.
Target Completion Date:
January 31, 2001.
3. Financial And
Technical Responsibility Determination
Corrective Action:
None Required (96% compliant).
4. Price Analysis
Adequacy
Corrective
Action: We
have significantly improved from FY 2000 (84%) to a 94% compliancy factor. Six
(6)% of the price analyses were less than sufficient. Some buyers did not
provide sufficient support of their analysis. Purchasing management needs to
assure that price analysis is performed and documented for all purchase actions
with emphasis on how reasonableness was established. Reinforcement training of
buyers will be required.
Target Completion Date:
November 30, 2001.
5. Adequate Sole Source
Justification Documentation
Corrective
Action: Purchasing
Procedure No. 42-10 requires buyer and reviewing official (Associate Purchasing
Officer) signatures on the justification. This was not performed which is the
main root cause. Reinforcement training of Buyers and the Associate Purchasing
Officer on proper documentation requirements of sole source procurement is
necessary.
Target Completion Date: October 31, 2001.
6. EEO Certification Not Properly Filled Out
Corrective Action:
With a 94% compliancy factor reinforcement training of Buyers on a
properly completed certification is still necessary.
Target Completion Date:
October 30, 2001
7. Buy American Waiver
Corrective Action:
None Required (100% compliant).
8. Use of DOE ICPT
Agreements
Corrective Action: One (1) out of seven (7) orders had not properly cited the DOE ICPT agreement number on the purchase order. Reinforcement training of the Buyer is necessary.
Target Completion Date:
October 31, 2001.
9. Debarred Listing Cite
Corrective Action: None Required (97% compliant).
10. Correct Clause Sets (BIS)
Corrective Action: None Required (98% compliant).
11. Incorrect Conflict Of Interest
List Date Cited.
Corrective Action: None Required (98% compliant).
12. Overall Adequacy Of File
Documentation
Corrective Action:
There were some instances where the Buyer checklist was not properly
completed and documents were missing from the official file.
Purchasing management will need to reinforce the requirement to all
Buyers that files must provide a complete and accurate audit trail of the
purchase transaction.
Target Completion Date: October 31, 2001.
2.2.3 Stanford University Audit Group Reviews
Allowable Costs Review
In April 2001, the Stanford University Internal Audit Group conducted an Allowable Cost Review for FY 2000. The objective of the audit was to determine whether costs incurred during the period October 1, 1999, through September 30, 2000, were allowable under the terms of the prime contract. The audit covered expense transactions processed through the Accounts Payable, Special Payments, Payroll, and Petty Cash systems. A sample of 100 transactions was selected from expenses processed through Accounts Payable and Special Payments. They also tested 10 payroll, 10 credit card, and 5 petty cash transactions. There were some findings and recommendations made in the various areas and corrective actions were subsequently implemented. An audit report was issued on April 12, 2001, (Engagement Number: 01-225) and is available upon request.
2.2.4 Internal Review Board
The Internal Review Board (IRB)
is comprised of the Purchasing Officer and one (1) Associate Purchasing Officer,
with Staff Counsel serving as an advisor as necessary.
All procurement actions to be submitted to the DOE for approval are
required to be reviewed by the Board prior to submittal. In addition, all
procurement actions exceeding $100K are to be reviewed by the IRB whether or not
they are to be submitted to the DOE. The
review focuses on the following areas:
Overall completeness of the
procurement.
Compliance with mandatory
requirements of regulations.
Quality of documentation in support
of contract type, source selection, and price.
Proper application of SLAC
Purchasing Procedures.
Compliance with prime contract
provisions.
Legal adequacy as a contractual
document.
A total of 72 actions were
reviewed by the IRB for FY 2001. The
reviews disclosed weaknesses in price analysis, incomplete representations and
certifications, exceptions to terms and conditions not explained sufficiently in
terms of resolve, purchase orders lacked appropriate language/conditions,
contractor travel requirements not explained sufficiently, inconsistency or lack
of file documentation, inconsistent unilateral option clause language and other
minor errors and omissions.
2.2.5 Effective Supplier Management
This measurement will be
obtained by dividing the number of line items delivered on time by the total
line items due (or total line items received).
Objective:
Effective Supplier Management
Measure:
% delivery on time (no later than 2 days after the Purchase Order due
date).
Target:
75% on time delivery.
Results:
Per the Narrative below, 64% (2 points - BSC Measured Rating) of the purchase orders were delivered on time.
Narrative
SLAC has designed a PeopleSoft
query to capture vendor performance by line item.
After discussions with
Procurement Manager’s at DOE Office of Science Laboratories, it was determined
that on time delivery was calculated by others to include those items delivered
up to 3 days after the Purchase Order due date so as to accommodate internal
processing of the delivered items. SLAC
has elected to use a definition of on time delivery of up to 2 days after the
Purchase Order due date.
The data
indicates that of the 14,017 Purchase Order line items measured during FY 2001,
64% were delivered on time. This
equates to a Balanced Score Card Measured Rating of 2 points.
This falls short of the Target for FY 2001 of 75%. Root cause analysis is
partially attributable to shorthand of labor prior to and after the December two
week facility shutdown. Another cause was the large number of items delivered
during and after the shutdown, which made it difficult for the workers to
process expediently. In some cases the backlog of items was three to four weeks.
Compounding this was the incorrect data entry of the date for receipt of items.
Receiving clerks were entering the items of the “day of entry” into the
system that did not always coincide with the actual receipt date at SLAC.
Notwithstanding, SLAC Purchasing
Management has designated this area as in need of special attention by the
Buyers and Expeditors during FY 2001. This
includes management analyzing late deliveries to identify those vendors that
need to improve their on-time deliveries. This
analysis will also identify the SLAC buyer so they are able to work with their
delinquent vendors.
2.2.6 Effective Utilization of Alternate Procurement
Approaches
This objective measures the
transfer of traditional purchasing activities such as supplier selection, best
value determination, ordering and receiving, from the purchasing organization
directly to the user organization. The percentage of this volume is determined
by the total number of transactions (Just In Time, Purchasing Authorization
Card, Releases against Basic Ordering Agreements) placed directly by the user
divided by the total number of actions awarded (includes Purchasing awards).
The period covered is October 2000 through September 2001.
Objective: Effective utilization of alternate procurement approaches.
Measure:
Optimum % of transactions placed by users (JIT, Purchase Card,
Blanket Order Releases) divided by the sum of total transactions.
Target:
75% (CAPS target is 72.5%)
Results: A 76% (5 Points - BSC Measured Rating) measurement was obtained as follows:
BIS Transactions = 7,339
Office Supply Releases - on line = 2,880
Officer Supply Releases - faxed = 780
U.S. GPO Releases = 31
Blanket Order Releases = 976
Book Order Releases = 348
Purchasing Card Transactions = 15,714
Petty Cash Transactions (est.)
=
2,000
Total Number of Transactions
=
30,068
Customer Issued Transactions
=
22,823
Percentage of Volume
(22,823/30,068)
=
76%
2.2.7 Streamlined Processes
This objective measures
improvements to the acquisition processes, which serve to enhance procurement
efficiency, reduce cycle time, reduce operating cost and increase overall
customer satisfaction with the procurement process. This measurement will be obtained by totaling the number of
re-engineered, re-designed, or re-validated processes.
Objective:
Streamlined Processes
Measure:
Number of critical processes re-engineered, re-designed or re-validated.
Target: Two
annually.
Results: Fourteen
critical processes were re-engineered, and one critical process was
re-designed in 2001 (see Narrative below). (10 points - BSC Measured Rating)
Narrative
a.
Organizational Changes Instituted (re-engineering effort)
Succession planning and efficiency of supervisory functions
were instituted with the following actions in FY 2001:
The above 9 re-engineering efforts constitute a major shift in the vision of the Purchasing Department. We considered the key positions of the department to be in much needed designation for alternate and back up purposes in the event of sickness and absences. As well, the planning for retirements and transition of staff to other positions within the department made it vital that these issues be addressed in order to continue to provide for uninterrupted and efficient customer services. Therefore, the foregoing actions are considered highly critical processes re-engineered.
b. Purchasing Procedures
Revision (re-engineering effort)
A major
achievement this year was the complete revision of the Purchasing
Procedures to make them consistent with the DOE prime contract (FAR, DEAR
clauses). The revision was considered a critical process due to the
information presented for the buyer as guidelines on how to conduct
procurements. The revised procedures were reviewed and found sufficient by the
DOE Contracting Officer by letter dated March 10, 2000.
c. On-line Shipper Implementation (re-engineering
effort)
In June 2001,
the Expediting group implemented its on-line data entry of the Shipper document
to aid the requestor community when items are to be shipped off-site. Regular
shipments, as well as hazardous materials shipments, were included in the
re-engineering process that, heretofore, was normally a manual intensive effort.
This was considered a critical process for the user community.
d. Stores Catalogue of Items
Available On-line (re-engineering effort)
In 2001, the
project for an on line Stores Catalogue of items available for SLAC customers
was completed. In addition pictures of approximately 4700 catalogue items was
implemented by July 2001. This is considered a critical process due to
the enhanced capabilities afford to the user community for a more efficient and
user-friendly system.
e. Vendor Data Entry Form (re-engineering effort)
In May 2001, the
form used for entering new vendor information went on-line. This allowed a
heretofore-manual effort to be entered electronically by the user community at
SLAC. This new feature now provides increased efficiency to the user community.
d.
On-line Attachments Under the BIS (re-engineering effort)
In July 2001,
attachments (Statements of Work, Sole Source Justifications, etc.) were allowed
to be electronically attached to the purchase requisition under the business
information system (BIS). Up until this point all attachments had to be manually
submitted to the department, which would then be matched up to the requisition
and delivered to the buyer. This new attribute is a significant efficiency
enhancement for both the user community and buyer. It is considered a critical
process enhancement.
f. Purchasing
Department Web Homepage (re-design effort)
The Purchasing
Department homepage was completely revised in its appearance and functionality.
Arrangement of various information portals was undertaken to enhance customer
accessibility and use. This effort was considered a major critical process
attributed to the breadth of information made available to the SLAC user
community.
2.2.8 Acquisition Process
This objective measures the efficiency of the acquisition process by measuring the time between receipt of an approved purchase requisition and award of the purchase order. The average cycle time is determined by dividing the total of time between receipt of requisitions and award by the number of awards.
Objective:
Acquisition Process
Measure:
Average cycle time (exception Purchasing Authorization Card)
Targets: Actions <$100K - 8.3 days
Actions >$101K - 30.9 days
All Actions
- 11.1 days
Results: Actions < $100K - 2.0 days
Actions > $101K - 11.7 days
All Actions
-
2.1 days
(15 points - BSC Measured Rating)
Narrative
For Fiscal Year
2001, the average cycle time for BIS procurements under $100,000 was 2.0
calendar days (7235 transactions), for procurements over $100,000 it was 11.7
calendar days (78 transactions), and for All procurements it was 2.1 calendar
days (7313 transactions). See Exhibits V and
Va depicting Requisition
Processing Time. Transactions are defined as both Purchase Orders and
Subcontracts. Processing time is
not tracked for the remaining dollars, which are attributable to credit card
purchases, blanket order releases, and modifications to existing purchase orders
and subcontracts.
Measured cycle time begins with
the approval by Purchasing Management of the purchase requisition (subsequently
assigned to the buyer) and ends with the award of the purchase order or
subcontract. Important to note here
is that efforts normally defined as pre-procurement planning are not represented
in the information system calculations. Purchasing staff is oriented to the
customer service process of initiating the request for proposal/bid package as
early as possible, which often precedes receipt and approval of the purchase
requisition from the requesting organization. This process is deemed to be more
responsive to the customer’s needs and supportive of SLAC’s mission.
A comparison of Fiscal Year 2000
and Fiscal Year 2001 data is as follows:
Transaction $
FY 00 Transactions FY 01
Transactions
Under $100K 1.33 Days 7169 2.0 Days 7235
Over $101K 9.48 Days 77 11.7 Days 78
All Actions
1.89 Days
7246
2.1 Days
7313
2.2.9
Good Corporate Citizenship through Purchasing
This objective measures the
success in achieving business practice goals.
This will be measured by dividing the number of socio-economic goals
achieved by the total number of goals.
Objective:
Good corporate citizenship through purchasing.
Measure:
% of economic and social diversity and local participation program goals
achieved including: SB and SDB Goals, Regional/Local Outreach/Support Good
Neighbor Program. Note: Not weighted for BSC purposes.
Target: Far exceeds expectations = >106% of goals.
Exceeds expectations = 101% to 105% of goals.
Meets expectations = 92% to 100% of goals.
Needs improvement
= <92% of goals.
Results:
As of September 30, 2001, SLAC attained 142% of the goals set
with the DOE.
Narrative
The Purchasing
Officer, in his role as Subcontracting Plan Administrator, routinely reports
socio-economic program progress to the Associate Director, Business Services
Division, for his information. He,
in turn, disseminates such information to other members of the Directorate so as
to keep them informed of SLAC's progress in meeting the Department of Energy's
socio-economic goal. The Subcontracting Plan Administrator, in his capacity as
Purchasing Officer, reviews goals, reports progress, and salient ideas and
innovative methods during scheduled buyer meetings. On a monthly basis each buyer is provided a printout of
individual accomplishments and overall cumulative progress in meeting the total
goals of the Laboratory. All
personnel are encouraged to develop new small, small disadvantaged, and small
woman-owned sources and assist such firms in becoming viable sources of services
and supplies to the Laboratory.
During Fiscal
Year 2001, the SLAC Purchasing Department’s performance against its
socio-economic goals was nothing short of outstanding. Every category was
exceeded in goal achievement except for awards to Small Business Disadvantaged
Business (see Exhibit VI).
SLAC’s
achievement is quite commendable in view of several factors.
A notable roadblock continues to be the impact of the SLAC Purchase Card
Program, which eliminated $5.2 million from the reportable base.
The SLAC Buyers have traditionally been able to place an extremely high
percentage of these low dollar value procurements with small, small
disadvantaged, and woman-owned businesses.
The DOE Headquarters Integrated
Contractor Purchasing Team (ICPT) initiative also contributed to a decrease in
available dollars for the socio-economic goals. Although using ICPT agreements is a cost effective means of
procuring goods and services and is an efficient way to achieve product
standardization, the program has a substantial impact on the socio-economic
program. For example, SLAC has
historically purchased desktop and laptop computers from small disadvantaged and
small woman-owned businesses. Since
FY 1998, by utilizing an ICPT BOA, SLAC standardized on Dell computers.
SLAC's efforts in Fiscal Year 2001 are summarized as follows:
|
FY 2001 |
GOALS |
|
ACTUAL REPORTABLE |
|
|
TOTAL |
$ 44.0M |
|
$ 51,630,433 |
|
|
Sm. Bus. |
$ 24.2M |
55.0% |
$ 31,172,615 |
60.4% |
|
Sm. Disadv. Bus. |
$ 4.4M |
10.0% |
$ 3,779,904 |
7.3% |
|
Sm. W/O |
$ 2.6M |
6.0% |
$ 5,182,856 |
10.0% |
|
8(a) Pilot |
$ 880K |
2.0% |
$ 2,269,504 |
4.4% |
|
Veteran Owned |
(not goaled) |
|
$ 31,078 |
.06% |
We feel that our program efforts
have been outstanding considering the removal of a large portion of the
procurement dollars from the base available for award to small, small
disadvantaged, and small woman owned businesses. The motivation and individual
efforts of each of our procurement personnel is to be commended in view of the
substantial obstacles that have been placed in their way.
During our yearly employee
performance appraisals, we stress to each Buyer the importance of the program
and encourage them to solicit small, small disadvantaged, and small woman-owned
business concerns at every opportunity. We
have in place means for monitoring each buyer's performance and utilize results
as one tool in our salary setting process.
This process has proven itself to be very satisfactory for SLAC as
evidenced by our year-to-year achievements, which we consider to be outstanding.
Individual buyer achievements are acknowledged and discussed at buyers
meetings along with progress toward meeting SLAC's goals.
SLAC participated in the High
Tech 2001 Small Business Procurement Fair and Conference in Los Angeles in March
2001, sponsored by JPL and NASA. The
two-day event included 200 Prime Contractor booths and was attended by
representatives of over 1000 small businesses.
The conference included numerous workshops on doing business with federal
agencies, prime contractors, and technology commercialization.
SLAC successfully established several new SDB and woman owned sources at
this conference. SLAC also
participated in the Second Annual DOE Small Business Conference and Procurement
Fair in Las Vegas in July 2001. Participation by DOE Program Offices, other
M&O Contractors, and over 175 small businesses was fostered.
In addition, SLAC received 54
letters this year from small, small disadvantaged, and small woman-owned
businesses seeking inclusion on our bidders list. Each letter of inquiry was reviewed and personally responded
to by the Purchasing Officer, giving the vendor the name and phone number of the
assigned buyer. A copy of the
letter and any vendor literature is forwarded to the appropriate buyer for
reference and inclusion on their bidder's lists.
With implementation of the Business Information System, we have also been
sending questionnaires to these new vendors. Both the SLAC Buyers and requisitioners load the information
they provide into our PeopleSoft vendor database that can be utilized.
In summary, the Stanford Linear
Accelerator Center continues to provide a very aggressive, positive, and
outstanding small, small disadvantaged, and small woman-owned business program.
2.3 FINANCIAL
PERSPECTIVE
This perspective measures the
functional cost efficiency of the purchasing organization. This will be measured
by establishing a cost to spend ratio, which will be calculated by dividing
Purchasing organizational costs divided by the business volume.
Organizational costs are the total costs for acquisition, i.e., labor,
direct, indirect, fringe benefits, overhead, travel, training, etc. Business
volume is defined as the total of all dollars obligated.
Objective: Optimum cost efficiency of
purchasing operations.
Measure:
Cost to spend ratio:
Purchasing Operation’s operating costs divided by purchasing
obligations.
Target:
$.025 per $1 of Goods and Services Procured.
Results:
The Purchasing Administration cost to acquire $1 of goods and
services at SLAC during Fiscal Year 2001 was $.0213 (10 points - BSC
Measured Rating). This is
calculated as follows:
Total Salaries and Fringe Benefits
= $1,470,000
Total Procurement Dollars in FY 00
= $68,858,502
Cost to Procure $1 of Goods and Services:
$1,470,000/$68,858,502
= $.0213
Narrative
Purchasing administration
includes salaries and fringe benefits and related M&S costs for those
Purchasing staff directly involved in the procurement of goods and services.
Excluded are such items as salaries associated with temporary duty
assignments for Purchasing personnel outside of the Purchasing Department. For
FY 2001, a Senior Buyer devoted 50% of her effort serving as the SLAC Sexual
Harassment Counselor. Additionally, she also served on the Director’s
Communications Task Force and she attended monthly breakfast meetings of the
Menlo Park Chamber of Commerce at the Director’s request.
The metrics included in the FY 2001
Balanced Score Card Self Assessment Plan are as follows:
Outstanding = <$.025
Excellent = $.025 to $.0279
Good = $.028 to $.0309
Marginal = >$.031 to $.0339
Unsatisfactory
= >$.0344
2.4 LEARNING
AND GROWTH PERSPECTIVE
The learning and growth
perspective measures Purchasing’s ability and potential to develop and grow.
This perspective looks to the future and sets objectives that strive for benefit
at a later date.
2.4.1 Employee Satisfaction
This objective measures the level
of satisfaction Purchasing staff experience with their working environment. As
part of this measurement, data was reviewed regarding employee voluntary
termination from the Purchasing Department. In the review Year 2000, the
Department continued its stable work force environment with no retirements or
voluntary termination. The Department is fortunate in the fact that it does not
exhibit a high transitory workforce. There
is virtually no turnover rate among the Buyers and Contract Administrators where
the length of SLAC service runs from three (3) to twenty-four (24) years.
Absenteeism is considered “as leave without pay” and there were no instances
of absenteeism during the review period.
Training of
personnel in FY 2001 continued to be constrained by budget priorities. This
situation improved in the last month of the fiscal year as Stanford University
has increased the employee education allowance from $800 to $1,200 per year
to defray costs of training, conferences, workshops or seminars that every
employee may enroll in to further their education.
A job rotation
program was begun in April 2001, to facilitate cross training among Purchasing
Department employees. The first rotation was between members of the Expediting
Group and the General Stores Group for a period lasting four months. Both
individuals rotated found the new experience rewarding and beneficial for their
respective job responsibilities.
The primary
measurement used to determine employee satisfaction was by the Climate Survey
Questionnaire (see Exhibit VII) conducted in September 2001.
The survey asked for the employee’s view of his/her working environment
in the following categories:
Training Adequacy
Working Environment
Management Support and Leadership
Employee Empowerment
Information Availability
Survey Results: The survey was distributed to eighteen (18) individuals within the Purchasing Department. A total of fifteen (15) responses were returned. Any survey response above the 3.00 level was considered a positive outlook on the working environment. Any average response below 3.00 was considered as a negative outlook. The majority of responses (13) registered an average of 4.00 or higher, while two (2) responses registered 3.00 or above. Concluding therefore that fifteen (15) responses were considered as fifteen (15) employees satisfied with the managerial and working environment.
There were fifteen (15) respondents to the survey whose satisfaction
level was calculated as follows:
5 points Strongly Agree
4 points Mostly Agree
3 points Agree (deemed as the Satisfactory level for the survey)
2 points Disagree
1 point Strongly
Disagree
0 points for No Opinion; and
The number of points for each statement for every respondent was added
up; and
We calculated the average rating by dividing the total points by the
number of questions responded to by that respondent; and
We counted the number of satisfied respondents (average rating of 3 or
above) and divided by the total number of respondents to arrive at the
percentage gradient
The percent of satisfied employees was measured by dividing the number of
satisfied employees (15) by the number of employees responding to the survey
(15). (15 divided by 15 = 100%)
Results: A 100%
weighting for this perspective was assigned per the above.
2.4.2 Employee Alignment
This objective measures the
alignment of individual goals with the organizational goals. Goals are normally
established with the employee at the time of performance evaluation. The SLAC
one-year evaluation period runs April through March. A review was conducted of
the 2001/2002 Purchasing staff’s Performance Evaluations to determine if the
goals established as of April, 2001, are consistent with and supportive of the
organizational goals. Employee alignment was measured by dividing the number of
aligned employees by the total number of employees with buying functions.
Survey Results:The following organizational goals were validated against individual goals for alignment:
Continue to be compliant with all Environment, Safety and Health (ES&H) training requirements. (Site-wide goal)
All of the
performance evaluations reviewed were found to contain the above goals and
deemed to be in alignment with SLAC organizational goals. As a result, employee
alignment was obtained at a rate of 100% of the total of twelve (12)
employees involved with buying functions.
2.4.3 Information Availability
This objective
measures the availability to Purchasing employees of current information on
strategic goals and objectives, on customers, on vendors, on internal processes,
and on financial consequences of their decisions. A survey (see Exhibit
VIII)
was conducted on September 2001 to determine what information tools are
necessary for the employees to do their jobs better and faster. This was
measured by dividing the number of information items available by the number of
information items needed.
Survey Results:
Verification was made of the following information resources available to each Buyer:
Purchasing Buyers Handbook (BIS)
Purchasing Procedures
Conflict of Interest Listing
Debarred Listing
Business Information System Web Site
Thomas Register
DOE Integrated Contractor Purchasing Team (ICPT) Homepage
FAR and DEAR web sites
SBA 8(a) and SDB Certification Homepage
Purchasing Department Homepage
Of the ten (10) information tools available, all were considered necessary for the employee to perform his/her responsibilities more efficiently. This translates into a measurement of 100%.
(For Items 2.4.1 through 2.4.3
above)
Objective: Employee Satisfaction; Organizational and Employee Alignment; Strategic Information Availability.
Measure:
Employee satisfaction index (includes data from employee survey, focus
groups, absenteeism, and voluntary termination’s.
Employee
alignment % of employees whose actual performance is aligned with Key Success
Factors.
There is a measure of useful information (policies, procedures, operational reports) available to employees.
Target:
Employee Satisfaction - 85% satisfied employees.
Employee Alignment - 90% aligned. (National)
Information
Availability - 90% of work groups have the data they need to do their jobs. (National)
Results: Employee
Satisfaction - 100% (5 points -
BSC Measured Rating)
Employment Alignment- 100% (5 points - BSC Measured Rating)
Information Availability- 100% (10 points - BSC Measured Rating)
D.
SUMMARY
The analysis of the Four Perspectives (Customer,
Internal, Financial, Learning and Growth) of the FY 2001 SLAC Balanced Score
Card Review, concluded that the processes and procedures of its Purchasing
System are adequate and compliant with applicable laws, regulations, and prime
contract terms and conditions to support the continued approval by the DOE.
The Balanced Score Card Summary (Exhibit
IX) depicts the total points available and total points achieved for each of
the Four Perspectives. As a result, a total point evaluation of 97 was
attained which translates into an adjective rating of Outstanding.
It is the opinion of the Review Team that the SLAC Purchasing System is consistent with and supports the DOE core values and critical success factor strategies of providing services that are responsive to customer needs, in accordance with established compliance requirements, and employment of best business practices to the maximum extent possible.
For Questions or comments, Please contact Ziba Mahdavi, Last Updated 10/24/00