HomeMy WebLinkAboutR-87-0236r' r
J-87-250
3/9/87
RESOLUTION NO. 87-236
A RESOLUTION AUTHORIZING THE CITY MANAGER TO
EMPLOY THE PROFESSIONAL CONSULTANT SERVICES
OF CANNON STIERHEIM BUSUTIL TO DEVELOP A
DIRECT COST ALLOCATION SYSTEM FOR GENERAL
SERVICES ADMINISTRATION DEPARTMENT, FLEET
MANAGEMENT DIVISION; ALLOCATING AN AMOUNT NOT
TO EXCEED $25,000 THEREFOR FROM THE GENERAL
SERVICES ADMINISTRATION DEPARTMENT OPERATING
BUDGET, SAID FEE TO BE REIMBURSED TO CITY OF
THE STUDY TO BE CONDUCTED BY SAID CONSULTANT
DOES NOT IDENTIFY SAVINGS IfOR REVENUE
OPPORTUNITIES WHICH, WHEN IMPLEMENTED AS
RECOMMENDED, OVER A ONE-YEAR PERIOD EXCEED
THE CONSULTANT'S FEE FOR SAID STUDY.
WHEREAS, the City of Miami General Services Administration
requires a cost allocation system for fleet management; and;
WHEREAS, the current system must be improved for maximum
efficiency and cost savings; and
WHEREAS, the firm of Cannon Stierheim Busutil has the
professional expertise required to review and analyze the current
direct cost system and to recommend an improved system;
NOW, THEREFORE, BE IT RESOLVED BY THE COMMISSION OF THE CITY
OF MIAMI, FLORIDA:
Section 1. The City Manager is hereby authorized to
employ the professional consultant services of Cannon Stierheim
Busutil to develop a direct cost system for the General Services
Administration Department, Fleet Management Division.
Section 2. An amount not to exceed $25,000 is hereby
allocated for the cost of said services from Account Number
420301-340 in the Operating Budget of the General Services
Administration, said fee to be reimbursed to City if the study to
be conducted by said consultant does not identify savings or
revenue opportunities, which, when implemented as recommended,
over a one-year period exceed the consultant's fee for said
study.
CITY CQMSSION
MEETING OF
MAR IS 1987
�. 87-236
t
PASSED AND ADOPTED this 13th day of March 1987.
XXVIER L. SUAREZ, YOR
ATT :
i&4�-
MA TY HIRAI, CITY CLERK
PREPARED AND APPROVED BY:
ROBERT F. CLARK
CHIEF DEPUTY CITY ATTORNEY
TO FORM AND CORRECTNESS:
xr L&% 11. LVUV
TY ATTONREY
FINANCE REVIEW AND APPROVAL BY:
CAXLGARCIA, DIRECTOR
BUDGETARY REVIEW AND APPROVAL BY:
Q--l-ll
MANOHAR A, DIRECTOR
RFC:bss:M358
2
87-23f ,
•
•
CITY OF MIAMI, FLORIDA
INTER -OFFICE MEMORANDUM
7o. The Honorable Mayor and Members DATE: March 5, 1987 RILE:
of the City Comm sion
SUBJECT: Resolution Authorizing
Employment of Cannon
Stierheim Busutil for a
FROM: Cesar H. Odio REFERENCES: Direct Cost System for
City Manager Fleet Management
ENCLOSURES:
RECOMMENDATION:
It is respectfully recommended that the City Commission adopt the
attached resolution authorizing the City Manager to employ
professional services of Cannon Stierheim Busutil to develop a
direct costs system for the General Services Administration
Department, Fleet Management Division, and allocating an amount
not to exceed $25,000 for this purpose. Consultants will refund
this fee if the study does not identify savings or revenue
opportunities which, if implemented as recommended, exceed the
fee over one year from the date of implementation.
BACKGROUND:
The General Services Administration Department has reviewed the
proposal of Cannon Stierheim Busutil to study the City's current
Fleet Management cost allocation system and to develop an
improved system for implementation by General Services
Administration Department. The current system in use by the City
is primarily based upon a prorated monthly estimate of fleet
requirements of each City department. The primary objective of
the study is to develop a direct cost system based on actual
departmental usage, which when implemented, will result in
significant cost savings to the City. Recommendations for
improved fleet management services and reduced operating costs
are also expected to result from this study and report.
It is anticipated by both the Consultants and City staff that the
cost savings produced by this effort will exceed the consultants
fee during the first year of implementation. Funds for this
activity are available in the General Services Administration
operating budget, in account number 420301-715, to be transferred
to 420301-340, Contractual Services.
Attachments
cc: Law Department
10
p-1
87-23E
City of Miami
General Services Administration
Direct Cost Allocation System
Proposal
r^
r"+
8'7-23('
on cSfier�ieim Zw*
Aranayemenl Consullanls
6720 d W. 124 cSlreel
Miami, .7forio(a jaw
(30.5) 2ss-8100
March 3, 1987
Mr. Cesar Odio
Manager
City of Miami
3300 Pan American Drive
Miami, Florida 33133
Dear Mr. Odio:
We are pleased to submit this proposal for a mans ement study of the City of
Miami's General Services Administration (G.S.A.l Fleet Management cost
r allocation system. Based on our discussions with you and subsequent discussions
with Messrs. Portuondo, Williams and Fernandez, we believe this study will
generate opportunities for substantial service improvements and operating
savings. These savings will be measurable both in terms of dollars expended and
less tangibly in meaningful changes organizationally and operationally. We
expect that this study, if implemented as recommended, will generate savings in
excess of our fee. Historically, these types of projects produce savings three to
four times the consulting cost during the first full year of implementation.
Guaranteed Fee
We are confident in our ability to identify cost savings or revenue opportunities
which will exceed our fee for this engagement. We commit this guarantee to be
based on identifiable and practical recommendations that will, if implemented as
recommended, generate savings over a full year from the date of
implementation, equal to or greater than our consulting revenues. If our study
does not identify savings or revenue opportunities which exceed our fee over one
year from the date of implementation, we will refund the fee.
The overall goal of our study is to assist you in developing a fleet management
cost allocation system which Is based on actual departmental expenditures. The
current system is primarily based on a pro -rated monthly estimate of projected
annual fleet management requirements for each department.
Objectives and Scope
For service organizations, productivity has been defined as the- ratio of the
quality and quantity of services provided to the resources used in providing those
services. The overall objectives of our study are: - -
Mr. Cesar Odio,!
March 3, 1987
Page 2
,.'r
ft To thoroughly review the current cost allocation system; and
• To develop recommendations which will:
o Enhance the operating efficiency of the cost allocation system;
o Improve the quality of G.S.A. fleet management services; and
o Reduce operating costs.
We will conduct a comprehensive operations review and methods analysis of your
current cost allocation system. We will also develop staffing recommendations
for the primary functions of the recommended direct cost allocation system.
Our overall consulting approach will be to conduct a hands-on, comprehensive
analysis of the fleet management cost allocation system working closely with
key personnel in G.S.A. and the Budget and Finance departments. We will spend
a substantial amount of time with these personnel in order to thoroughly
familiarize ourselves with your current system.
Our engagement will be carried out through:
o A thorough review of the current cost allocation system;
o A comprehensive review of industry standards for all significant repair
tasks;
o The development of preliminary direct cost allocation system recom-
mendations;
o The development of staffing requirements under the recommended
system;
o The preparation of a draft report; and
o The issuance of the final report and recommendations.
Exhibit I is a detailed work plan which we have prepared for your review.
Project Staff
William Busutil and Judith Cannon, Consulting Partners, will have overall project
management responsibility for this engagement. Mr. Busutil and Ms. Cannon
have extensive consulting experience in reviewing governmental operations and
analyzing Fleet Management Systems. Our consultants possess broad
backgrounds in public service and productivitymanagement, and will bring a
keen insight of local government operations to this engagement.
11
Ja -y
87-936
Mr. Cesar Odio
March 3, 1997
Page 3
Merrett Stierheim is a Cannon Stierheim advisor and resource. He will provide
advisory assistance to our project team. Mr. Stierheim has over twenty-six years
of distinguished experience in public service. In addition he will review project
reports and be available for consultation.
Our project team's resumes are attached for your review.
Schedule and Fee Estimate
Our team is prepared to begin work on the study within one week of your
authorization. Based on the work plan in Exhibit I, we would expect to complete
our engagement in approximately eight weeks after the starting date. In
developing our estimate we have relied on the active involvement and timely
availability of key City personnel during the engagement. While we do not
antic:?ate any delays, holidays, vacations or special circumstances may
somewhat affect the scheduled completion of this project. We will inform you
promptly of any delays as soon as they are detected.
Our fee is based on the actual hours worked on the engagement, multiplied by
the contractual billing rates for the levels of personnel assigned. Our billing
:a:es include all costs for professional staff, overhead, travel and other project
.� expenses. We estimate our fee for this engagement to be $25,000. Should our
time requirements be lower than anticipated, or the project %vo: k plan shown in
Exhibit I be amended in any way, we will bill only :or time actually worked. We
will follow our normal practice c:. biiling time and expenses bi-weekly, as
incurred.
We believe this proposal is responsive to the City of Miami's need for a
management study of the G.S.A. Fleet Management cost allocation system. We
are confident that your administration, the G.S.A. Director and his staff, the
Mayor and Commission, and the taxpayers of the City will realize substantial
cost savings and improved service through this effort. We will be pleased to
provide additional information as you require, and look forward to receiving your
instructions to proceed.
Sincerely,
zwrrJ
Cannon Stierheim Busutil Management Consultants
to-5
87-236
0
Exihibit I
City of Miami
General Services Administration
Fleet Management
Consulting Work Plan
Consulting Hours
A.
Review current fixed monthly rate
charge -back system:
;.
Interview key G.S.A. personnel (5 interviews)
10
2.
Interview Budget and Finance personnel
4
(2 interviews)
3.
Review data collected during interviews
24
4.
Flowcharj current system
8
5.
Summarize initial findings
8
,.� B.
Develop preliminary charge -back system
recommendations:
1.
Examine systems in other organizations
24
2.
Perform final data analysis
12
3.
Summarize preliminary recommendations
18
C.
Develop maintenance and repair standards:
1.
Evaluate industry standards
28
2.
Adjust industry standards for profit
28
margins
3.
Develop standards for non industry-
34
wide tasks
D.
Develop staffing requirements:
1.
Define prdjected workload
24
2.
Prepare detailed manpower budgets
30
E.
Prepare final report:
1.
Prepare draft report
30
2.
Discuss report and recommendations with
9
City Managers GSA Director and appropriate
staff.
w— 3.
Prepare and issue final report
16
87-236.
WILLIAM J. BUSUTIL
Partner
Cannon Stierheim Productivity Management Consultants
Date of Birth: November 27, 1951
Place of Birth: Havana, Cuba
PERSONAL
EDUCATION
B.B.A. Business Administration, Florida International Univerisity,1974
- M.P.A., Public Administration, Texas Tech University, 1978
PROFESSIONAL EXPERIENCE
Metropolitan Dade County, Training Manager, Office of Productivity
1V&ar i4&-* a: ;;.t, 198Z - 1986
Price Waterhouse, Senior Consultant, 1981-1982
Metropolitan Dade County, Productivity Analyst, Productivity Analysis Uniz,
Office of Management and Budget; Office of the County Manager, Management
Intern, 1978 -1981
City of Hialeah Recreation Department, Internal Accountant and Purchasing
Agent, 1973 - 1977. Responsible for cost control, inventory control, and
procurement management.
CONSULTING EXPERIENCE
Managed a productivity improvement team which designed and implemented a
preventive maintenance program, a work order reporting system, a work
scheduling system, a quick repair service, and a performance reporting system
for a heavy equipment maintenance shop of a local governmental agency.
Recommendations implemented during the engagement reduced operating costs
and provided for better manpower planning and control as well as improved
maintenance histories and records.
Served as a lead analyst during a productivity improvement study of a
metropolitan transit agency bus maintenance operation. The study included the
major overhaul and repair operations of the 800 bus fleet, and running repairs
and fueling and servicing of a 300 bus district fleet.. During the study, the
project team revised work flows, prepared a standards manual for work
estimating, developed a preventive maintenance program, used line balancing
and queueing theory to revise fueling and servicing procedures, developed shop
scheduling tools, and prepared staffing budgets. In addition to major
improvements in service delivery, the study identified $300,000 in annual staff
savings.
Provided extensive technical assistance in the development of routing,
scheduling and staffing configurations for a metropolitan garbage and trash
collection operation. Recommendations from this project identified annual cost
savings of over $2,500,000.
IG-7
87-236
William J. BusL
Page 2
Conducted a productivity management project for a local government sanitation
department. Recommendations from this project identified several significant
improvements in manpower utilization and quality of services, and cost savings
of over $90,000 per year.
Served as the lead analyst on a productivity improvement project team which
improved and implemented Inspection procedures and developed a manpower
scheduling system and manpower budgets for a local motor vehicle inspection
agency. The study Included applications of queueing theory and line balancing.
Recommendations Implemented during the engagement resulted in annual
operating cost savings of $500,000 with no reductions in service.
Successfully conducted several comprehensive 120 hour productivity management
consulting seminars for over 200 professionals from the following organizations:
Metropolitan Dade County
Lee County
Florida Highway Patrol
City of Hialeah
City of Miami Beach
City of Orlando
City of Richmond
James City County
City of North Miami
American Express Company
South Miami Hospital
Jackson Memorial Hospital
City of Lynchburg
City of Virginia Beach
City of Hampton
Henrico County
City of Alexandria
Chesterfield County
Served as an analyst In a productivity improvement study in the tax collection
division of a large metropolitan county government. The study included a review
of current operations, value analysis of methods and procedures, work
measurement, and manpower budgeting. Special techniques employed include
queueing theory, MODAPTS, and cash flow analysis. The improved procedure
reduced average processing time from four weeks to five days, which resulted in
additional annual interest earnings of $7500000.
Designed, implemented, and monitored a cost accounting system and inventory
control system for a local governmental agency.
/a-g
87-236
3UDITH A. CANNON
Principal Partner
Cannon Stierhelm Productivity Management Consultants
PERSONAL
Date of Birth: July 9,1955
Place of Birth: (British Guiana) Guyana
EDUCATION
Bachelor of Arts Degree, Barry College,1975
Majors - History, Public Administration, Criminal Justice
Graduate Work, Public Administration, Florida Atlantic University, 1976
Graduate Work, International Studies, Florida International University,1983
Graduate, Price Waterhouse Productivity Techniques Training, January,1980
PROFESSIONAL EXPERIENCE
Principal Partner, Cannon Stierheim Productivity Management Consultants,
January 1986 - Present
Productivity Management Analyst, Office of the State Attorney, Eleventh
Judicial Circuit of Florida, July 1935 - December 1985
Material Management do Procurement Systems Analyst, Florida Power & Light
Company, Corporate Office, January 1985 - June 1985
Substitute Teacher, Dade County Public Schools, 1983 -1984
Management Productivity Analyst 1II9 Office of Productivity Management,
,Aetro-Dade County, Florida, 1979 -1983
Administrative Assistant, Metro -Dade County, Florida, Division of Citizen's
Services, County Manager's Office,1976 -1979
City of Delray Beach, Florida, 1973 -1976
Center Assistant, Delray Beach Tennis Center
Library Technician, Delray Beach Library
Day Camp Counsellor, Delray Beach Junior Day Camp
CONSULTING EXPERIENCE
As an Analyst during a Productivity Improvement study of a metropolitan transit
agency, developed work standards and work planning and scheduling system for a
repair operation of an 800 bus fleet. Recommendations from this study resulted
in annual cost savings of $500,000.
As a Lead Analyst during a Productivity improvement Study of a metropolitan
transportation agency, developed recommendations for improved crew
scheduling, manpower and materials utilization, operational methods
Improvements and work planning and scheduling. Recommendations from this
study resulted in annual cost savings in excess of $450,000.
87-236