The Best Run Schools Run SchoolDude! Kent Hudson CEO, Co-Founder, SchoolDude.com March 2012

The Best Run Schools Run SchoolDude! 40’s,50’s & 60’s 1. Custodial operations 2. Maintenance operations 3. Grounds operations 4. Electrical / gas utility 5. Pest control (in-house) 6. Playground equipment 7. Roofs 8. Safety – general 9. School closings 10. Vandalism 1. Custodial operations 2. Maintenance operations 3. Grounds operations 4. Electrical / gas utility 5. Playground equipment 6. Pest control (in-house) 7. Roofs 8. Safety – general 9. School closings 10. Vandalism 11. Mold management 12. Asbestos (AHERA) 13. Carbon Dioxide testing 14. Lead in water 15. Natural gas volume purchasing 16. Electrical volume purchasing 17. CAD 18. CMMS with preventive maintenance 19. Electromagnetic emissions 20. Emergency / disaster plans 21. Energy management systems 22. Energy education 23. Data based custodial schedules 24. Rentals, community usage 25. ADA 26. Owners Construction Rep. 27. Indoor Air Quality 28. Lead in paint 29. Integrated Pest Management 30. Privatized custodial 31. Purchased services management 32. Protective equipment & clothing 33. Radon Management 34. Recycle waste program 35. Re-locatable classrooms 36. Right to Know Act 37. Underground storage tanks 38. Computerization – technology support 39. Blood borne pathogens 40. Budget planning 41. Labor law issues 42. OSHA Logging & training 43. Custodial equipment management 44. Quality Assurance program 45. Hazardous Waste Removal 46. Emergency Backpacks 47. Building Backpack Supply 48. Defibrillator maintenance 49. Defibrillator training 50. Security systems 51. Green chemical management 52. Carbon footprint issues 53. Sustainability program 54. Life/Safety Planning 55. Playground management 56. Expanded athletic programs 57. Swimming pool maintenance 58. Indoor track & field 59. Fertilization & weed control 60. Artificial athletic fields Facility programs have increased dramatically but many institutions have smaller leadership teams 70’s,80’s,90’s,00’s & Now The Increased Scope of Education Facility Management Education Facility Managers are so over programmed that a complete program is rarely delivered Copyright © 2010 Service Management Assist, LLC

The Best Run Schools Run SchoolDude! The Challenges We Face Today

The Best Run Schools Run SchoolDude! Issue #1: Stewardship is falling

The Best Run Schools Run SchoolDude! Our backlogs are growing, and we fear that priorities are becoming more acute. Issue #3: Severity of backlogs is increasing

The Best Run Schools Run SchoolDude! What’s the impact?

The Best Run Schools Run SchoolDude! ECON 101 If Customer Service is “Free with Unlimited Supply” – Demand will grow to consume all of your supply – Limit levels will eventually be hit resulting in customer dissatisfaction – Nothing will be left for stewardship “Customers unwittingly steal resources from the long-term preservation of facilities... Customers must be served professionally but it should not be at the expense of all else. Better service delivery is key.” APPA Maintenance Staffing Guidelines

The Best Run Schools Run SchoolDude! Balancing Stewardship Vs. Service Stewardship Guardian of physical plant Preventive Maintenance Planned Maintenance Service Support to staff on request Events Curriculum Moves Minor repairs

The Best Run Schools Run SchoolDude! Best Practices Organization APPA Maintenance Staffing Guidelines – Ch 3

The Best Run Schools Run SchoolDude! It’s a brand new building, why do we need to maintain it? We need to cut maintenance so we can “save” money.

The Best Run Schools Run SchoolDude! BENEFITS OF A SUCCESSFUL PM PROGRAM “Benefits of a Successful PM Program” is taken from Complete Building Equipment Maintenance Desk Book Second Edition, Edited by Sheldon J. Fuchs, P.E. Page 19 in the chapter by Paul D. Tomlingson. Fewer Failures - A timely PM program usually uncovers problems before they become serious enough to cause equipment failures. Breakdowns can be reduced by 50 percent. More Planned Work - The timeliness of preventive maintenance inspections usually uncovers those major jobs that require planning. Sufficient lead time allows planning to be done. Fewer Emergencies - An effective PM program has every maintenance employee on the alert for things that cause problems. As a result, fewer problems that would cause an emergency situation escape detection. Emergency work can be reduced by half.

The Best Run Schools Run SchoolDude! Reduced Overtime - One of the largest contributing factors to overtime is the need to perform emergency work. A reduction in emergency work usually produces a corresponding decrease in overtime. Extended Equipment Life - PM invariably rewards its users by extending equipment life by as much as 20 percent and increasing dependability. Better Use of Maintenance Personnel - A job done under emergency conditions is 15 percent more costly in labor than a similar, well planned job. A maintenance department with a good PM program commits more staff to planned work. The result is more effective, productive use of this manpower. Improved Equipment Operation - Well-cared-for equipment is its own reward - it runs better. Less Downtime - Because the PM program can reduce emergency work, it follows that downtime can also be reduced.

The Best Run Schools Run SchoolDude! Clichés Pay me now or pay me later An ounce of prevention is worth a pound of cure Change the oil or change the engine – you choose Are they true?

The Best Run Schools Run SchoolDude! Data Dudes Perspective over 6,000 clients live operational data (400+ Higher Ed Institutions) Partnership with SAS Institute, largest privately held software company in world Terabytes of data Technology: Ability to mine for group gold

The Best Run Schools Run SchoolDude! Recently published...

The Best Run Schools Run SchoolDude! Methodology Data analysis across nearly 6,000 educational clients live operational data (400+ Higher Ed Institutions) Identification of “PM Masters” – Top deciles within peer group – Allocating high percentage of manpower to PM (> 30%) – High completion rates (> 98%) – Been doing so for quite a while (> 3 years)

The Best Run Schools Run SchoolDude! Key Questions 1. How does a PM program affect overall costs and emergencies? 2. What are the financial impacts to facility capital needs? 3. With utility costs comprising a large portion of the M&O budget, how can PM impact your energy use and building efficiencies? 4. How does PM affect other costs or risks, such as insurance claims?

The Best Run Schools Run SchoolDude! Cost Impact 50% - 65% reduction in the rate of emergency work Lower cost per work order with the average cost per work order being 28.6% to 39.3% less

The Best Run Schools Run SchoolDude! PM Reduces Corrective Work Over a 5-year period, a sampling of PM Masters garnered a 16% reduction in corrective maintenance work as a percent of the total work over the time period. Over a 20-organization sample across the 5-year time span, the corrective work as a percent of the total work is reduced from approximately 87% to 71% of the total work performed.

The Best Run Schools Run SchoolDude! The Transition...

The Best Run Schools Run SchoolDude! Reducing Emergency Work

The Best Run Schools Run SchoolDude! PM Capital 101 Value of roof (6%) Value of HVAC (11%) Total for just two systems:17% of replacement value Assuming 15 year life extended to 17 years with a PM program (very conservative) Capital Budget Relief estimate: $0.25 per square foot per year

The Best Run Schools Run SchoolDude! Energy Impact from PM Interviews with experts – performance contracting engineers HVAC related load – Often around 50% of load – Expected improvement from PM – 10% improved – Estimated 5% energy bill reduction

The Best Run Schools Run SchoolDude! Energy Cost Trend 17% increase from Cost is hard to control- but consumption is something you have some measure of control over.

The Best Run Schools Run SchoolDude! The Data says… ~25% reduction in Electric consumption for institutions performing PM. KWH/Sq. Foot

The Best Run Schools Run SchoolDude! The Data says… ~30% reduction in Natural Gas consumption for institutions that are performing PM. Therms/Sq. Foot

The Best Run Schools Run SchoolDude! The Connection with Risk P&C Insurance company – private study – 18,000 schools with multiple years of claims history. – 12,000 SchoolDude schools – 9,000 school overlap with at least minimal PM activity Results: – 70% reduction in claims – 11% reduction in claims severity

The Best Run Schools Run SchoolDude! Summary PM Benefits Reduce emergencies 50% Reduce average cost per work order up to 40% Reduce long term capital costs Reduce disruption of the learning environment All the data confirms investing in PM is the right business decision!

The Best Run Schools Run SchoolDude! Equipment Failure Equipment Failure Mean Time to Report Problem Identified Action Starts Problem Identified Action Starts Technician Assigned Truck Rolls Technician Assigned Truck Rolls Mean Time to Respond Mean Time to Repair Mean Time Between Failure Problem Solved Total Outage Time Root Cause Analysis BPR Root Cause Analysis BPR Facility Management Work Order Model

The Best Run Schools Run SchoolDude! Technology Assisted Maintenance Buildings with BAS; Connect and move data to the Cloud Cloud Data Depot(s) SaaS Applications - Inforich Work Orders - PM Automation - Critical Alarm Auto. - Predictive Maintenance

The Best Run Schools Run SchoolDude! Closing Remarks Master the art of selling the value of PM Much information exists Contact SchoolDude for more detailed information on these resources Heather May