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Define Characteristics of Organization Based Control
Intermediate Cost Analysis and Management Show Slide #1: Define Characteristics of Organization Based Control Title: Define Characteristics of Organization Based Control References: Handouts, Excel Spreadsheets Facilitator Material and Student Material: Dry erase markers, white boards, access to Excel spreadsheets, case-studies Facilitator Material: Each primary facilitator should possess a lesson plan, slide deck, course handouts, practical exercises, access to Excel spreadsheets, case-studies All required references and technical manuals will be provided by the local Command. Student Material: Students should possess course handouts, practical exercises, access to Excel spreadsheets, case-studies and standard classroom supplies. Throughout the lesson discussion seek opportunities to link the competencies with the lesson content through the student’s experiences. 12.1
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Everyone is Part of a Hierarchy
Show Slide #2: Everyone is Part of a Hierarchy Facilitator’s Note: (Concrete Experience 10 minutes) Present students the slide statements Ask students what their thoughts are on “being part of a hierarchy.” Facilitator’s Note: (Publish and Process 10 minutes) The critical portion of this part of the ELM process is to force the students to reflect. Ask a series of thought influencing questions. Facilitator’s Note: Motivator: Everyone is part of a hierarchy. Where do you fit in your organization? Who answers to you? To whom do you answer? How does the organization structure affect the way your organization operates?
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Terminal Learning Objective
Action: Define Characteristics of Organization Based Control Condition: You are training to become an ACE with access to ICAM course handouts, readings, spreadsheet tools, and awareness of Operational Environment (OE) variables and actors Standard: With at least 80% accuracy: Describe the difference between Cost Benefit Analysis and Cost Managed Organizations Describe characteristics of Organization Based Control Show Slide #3: TLO Task: Define Characteristics of Organization Based Control Condition: You are training to become an ACE with access to ICAM course handouts, readings, spreadsheet tools, and awareness of Operational Environment (OE) variables and actors Standard: With at least 80% accuracy: Describe the difference between Cost Benefit Analysis and Cost Managed Organizations Describe characteristics of Organization Based Control Safety Requirements: In a training environment, leaders must perform a risk assessment in accordance with DA PAM , Risk Management. Leaders will complete a DD Form 2977 DELIBERATE RISK ASSESSMENT WORKSHEET during the planning and completion of each task and sub-task by assessing mission, enemy, terrain and weather, troops and support available-time available and civil considerations (METT-TC). Local policies and procedures must be followed during times of increased heat category in order to avoid heat related injury. Consider the work/rest cycles and water replacement guidelines IAW TRADOC Regulation Environmental Considerations: Environmental protection is not just the law but the right thing to do. It is a continual process and starts with deliberate planning. Always be alert to ways to protect our environment during training and missions. In doing so, you will contribute to the sustainment of our training resources while protecting people and the environment from harmful effects. Refer to FM Environmental Considerations and GTA ENVIRONMENTAL-RELATED RISK ASSESSMENT. INSTRUCTIONAL LEAD-IN. Starts on next slide
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Contrasting CBAs and CMOs
Single Use Estimated Future Cost Cost Informed Decision Making Cost Benefit Analysis Show Slide #4: Instructional Lead-in: Facilitator Note: Let’s start by looking at the difference between Cost Benefit Analysis (CBA) and the Cost Managed Organization (CMO) CBA is a single use, one-time analysis that is used to support cost informed decisions. It is important, but different from a Cost Managed Organization (CMO). Cost Benefit Analysis
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Continuous Improvement Cost Managed Organization
Contrasting CBAs and CMOs Single Use Estimated Future Cost Cost Informed Decision Making Cost Benefit Analysis Persistent Use Expected & Actual Cost Continuous Improvement Cost Managed Organization Cost Benefit Analysis Show Slide #5: Describe the difference between Cost Benefit Analysis and Cost Managed Organizations Learning Step/Activity #1 Describe the difference between Cost Benefit Analysis and Cost Managed Organizations Method of Instruction: DSL (large or small group discussion) Facilitator to Student Ratio: Time of Instruction: 2.0 (Total) Media: Power Point Presentation, Printed Reference Materials Facilitator’s Note: The CMO (Cost Managed Organization) represents the persistent use of cost information. We have discussed already how this way of using cost information has power to transform the organization. Both are important, and both play different roles in winning the cost war.
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Contrasting CBAs and CMOs
Cost Benefit Analysis Uses a formal, structured process to inject cost considerations into the decision making process Improves the cost effectiveness of acquisitions, policy alternatives, and other major decisions Is too time consuming and costly itself to be used for all day-to-day operating decisions Cost Managed Organizations Use cost management and control processes to improve the cost management and control of day-to-day operations Show Slide #6: Describe the difference between Cost Benefit Analysis and Cost Managed Organizations (Cont.) Facilitator Note: Here are some major differences between the two: Cost Benefit Analysis Uses a formal, structured process to inject cost considerations into the decision making process. The step-by-step process assures that cost informed decisions are made using the best information available. CBA improves the cost effectiveness of acquisitions, policy alternatives, and other major decisions by causing the decision maker to question preconceived ideas and decision criteria. The large dollar amounts involved in major acquisitions justify the resources spent on studying various alternatives because the benefit of improved decisions could represent large dollar savings. However, CBA is too time consuming and costly itself to be used for all day-to-day operating decisions. Therefore, another option must be available. Cost Managed Organizations Use cost management and control processes to improve the cost management and control of day-to-day operations. Cost managed organizations use cost information on an ongoing basis to improve daily operational decisions, not just major acquisition decisions.
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Contrasting CBAs and CMOs (Cont.)
Gets Input and Makes Decisions Cost Estimation Study, Not a Process Cost Estimating Factors and System Commands and Controls Process Analysis, Ops, Control, Org After Action Review Cost Accounting System Leadership Cost Benefit Analysis Cost Managed Organization Show Slide #7: Describe the difference between Cost Benefit Analysis and Cost Managed Organizations (Cont.) Facilitator Note: Notice how the CBA and CMOs differ in four major areas: The first is leadership’s role. In CBA, the leader’s role is to receive input from the ACE and make the decision. The leader should also provide guidance as to alternatives and decision criteria. In a CMO the leader’s role is to command and control, or lead the control process.
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Contrasting CBAs and CMOs (Cont.)
Gets Input and Makes Decisions Cost Estimation Study, Not a Process Cost Estimating Factors and System Commands and Controls Process Analysis, Ops, Control, Org After Action Review Cost Accounting System ACE Expertise Cost Benefit Analysis Cost Managed Organization Show Slide #8: Describe the difference between Cost Benefit Analysis and Cost Managed Organizations (Cont.) Facilitator Note: The ACE’s expertise is used differently in CBA and CMOs. In a CBA, the ACE’s role is to provide estimated costs for the various alternatives. In a CMO, the ACE’s role is to provide analysis and information necessary for the cost control process. This includes, but is not limited to cost measurement of operations, variance analysis and cost explanation.
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Contrasting CBAs and CMOs (Cont.)
Gets Input and Makes Decisions Cost Estimation Study, Not a Process Cost Estimating Factors and System Commands and Controls Process Analysis, Ops, Control, Org After Action Review Cost Accounting System Process Cost Benefit Analysis Cost Managed Organization Show Slide #9: Describe the difference between Cost Benefit Analysis and Cost Managed Organizations (Cont.) Facilitator Note: The Process is different in CBA and CMOs. In fact, CBA is not a process at all. It is a one-time study which ends when the decision is complete. The CMO uses the After Action Review as an ongoing cost control process.
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Contrasting CBAs and CMOs (Cont.)
Gets Input and Makes Decisions Cost Estimation Study, Not a Process Cost Estimating Factors and System Commands and Controls Process Analysis, Ops, Control, Org After Action Review Cost Accounting System Measurement Cost Benefit Analysis Cost Managed Organization Show Slide #10: Describe the difference between Cost Benefit Analysis and Cost Managed Organizations (Cont.) Facilitator Note: Lastly, the measurement focus is different in a CBA and a CMO. CBAs use cost estimating factors and systems. CMOs will generally develop a cost accounting system to support the cost management process.
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CMOs Look for a Return on Investment From Cost Management and Control
Desired 10 to 1 Ratio beneficial use Process and Measurement cost Show Slide #11: Describe the difference between Cost Benefit Analysis and Cost Managed Organizations (Cont.) Facilitator Note: Cost Benefit Analysis is generally looking for a balance between the benefit received for the cost paid. The benefit should be equal to or greater than the cost. Because the cost management and control process is ongoing, CMOs need to achieve a much greater return on their investment in cost information. Ideally there should be a 10 to 1 ratio between the benefit received and the cost of the process and measurement. Credible and affordable information is crucial in achieving this level of benefit. credibility
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LSA #1 Check on Learning Q1. How does the leader’s role in CBA differ from that in a CMO? A1. The leader’s role in a CBA is to receive the information provided by the analyst and make the decision (the leader also has the role of shaping the alternatives and decision criteria.) Q2. Why is CBA justified in major acquisition decisions? A2. Because of the large dollar value of the decisions being made. Show Slide #12: LSA #1 Check on Learning Facilitator Note: Ask the following questions. Facilitate the answers given. Q. How does the leader’s role in CBA differ from that in a CMO? A. The leader’s role in a CBA is to receive the information provided by the analyst and make the decision (the leader also has the role of shaping the alternatives and decision criteria.) Q. Why is CBA justified in major acquisition decisions? A. Because of the large dollar value of the decisions being made.
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LSA #1 Summary During this activity, we compared and contrasted Cost Benefit Analysis and Cost Managed organizations. The ACE is responsible to give input in order for the senior leader to make a decision. Show Slide #13: LSA #1 Summary Facilitator Note: Restate the Summary; During this activity, we compared and contrasted Cost Benefit Analysis and Cost Managed organizations. The ACE is responsible to give input in order for the senior leader to make a decision.
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Different Types of CMOs
Organization Based Exploits existing accountability relationships embedded in every organization Role Based Adds new accountability relationships to control costs for specific purpose Output Based Focuses control on product or service costs Show Slide #14: Describe characteristics of Organization Based Control Learning Step/Activity #2 Describe characteristics of Organization Based Control Method of Instruction: DSL (large or small group discussion) Facilitator to Student Ratio: Time of Instruction: 2.0 (Total) Media: Power Point Presentation, Printed Reference Materials Facilitator’s Note: Cost managed organizations take many forms, and tend to fall into three major categories: Organization Based, Role Based, and Output Based. Organization based CMOs exploit existing accountability relationships embedded in every organization. In other words, it uses the organization’s chain of command or organizational structure. Role Based CMOs add new accountability relationships to control costs for specific purpose. While the organization structure may “stovepipe” support functions and mission functions, role-based management recognizes that support functions actually work for the mission functions. Output Based CMOs focus control on product or service costs.
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Organization Based Control
Utilizes Each Node in the Chain of Command in AAR Process Tier 1 Leader AAR Tier 2 Leader Tier 2 Leader Show Slide #15: Describe characteristics of Organization Based Control (Cont.) Facilitator Note: Organization Based Control utilizes each node in the Chain of Command in the AAR process. The lower level leaders report to upper level leaders in the After Action Review, who in turn report to the next level up the chain of command in another After Action Review. Each level of leadership provides an opportunity for an AAR. This provides the opportunity for learning and improvement. The higher level leaders request continuous improvement initiatives, and the subordinates at each level use their specific knowledge to find those areas where improvements can be realized. AAR AAR Tier 3 Leader Tier 3 Leader Tier 3 Leader Tier 3 Leader
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Organization Based Control
Strengths Takes advantage of existing accountability relationships Subordinates are accustomed to taking direction and critique from their superiors Greatest challenge Defining and motivating the Cost Chain of Command Show Slide #16: Describe characteristics of Organization Based Control (Cont.) Facilitator Note: The strengths of Organization Based Control are that it: Takes advantage of existing accountability relationships. There is no need to re-invent the wheel. And, subordinates are (or should be) accustomed to taking direction and critique from their superiors. Greatest challenge Defining and motivating the Cost Chain of Command. Leaders at all levels must see this as a priority.
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The Power of Decentralization
The power of the AAR can extend throughout any sized organization Show Slide #17: Describe characteristics of Organization Based Control (Cont.) Facilitator Note: The power of the AAR can extend throughout any sized organization using the existing relationships. Signaling expectations flows downward through the organization and cost explanation and improvement initiatives flow upward.
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LSA #2 Check on Learning Q1. What are the three general categories of Cost Managed Organizations? A1. Organization Based, Role Based, Output Based. Q2. What are the strengths of Organization Based CMOs? A2. They take advantage of existing organization structure and accountability relationships. Subordinates are already used to taking direction and critique from their superiors. Show Slide #18: LSA #2 Check on Learning Facilitator Note: Ask the following questions. Facilitate the answers given. Q. What are the three general categories of Cost Managed Organizations? Organization Based, Role Based, Output Based. What are the strengths of Organization Based CMOs? A. They take advantage of existing organization structure and accountability relationships. Subordinates are already used to taking direction and critique from their superiors.
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LSA #2 Summary We identified three different types of Cost Managed Organizations and discussed the strengths and challenges of Organization-Based CMO. Show Slide #19: LSA #2 Summary Facilitator Note: Restate the Summary; During this discussion, we described the characteristics of Organizational Based Control. Have the students reflect on this topic, adding related and relevant points while facilitating the discussion.
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Practical Demonstration 3d Armored Cavalry Regiment
The 3d Armored Cavalry Regiment is a unique armored Brigade level unit with a storied history LTG George Patton was once its regimental commander As was GEN Dempsey Soldiers are the most expensive cost element in a tactical unit AMCOS is an Army tool to evaluate cost of military and civilian personnel Go to and log in with AKO or CAC Show Slide #20: Demonstration Exercise. 3. Learning Step/Activity #3 Demonstration Exercise. Method of Instruction: DSL (large or small group discussion) Facilitator to Student Ratio: Time of Instruction: 2.0 (Total) Media: Power Point Presentation, Printed Reference Materials Facilitator’s Note: Let’s look at the characteristics of organization based control in a real organization, the 3d Armored Calvary Regiment. The 3d Armored Cavalry Regiment is a Heavy Brigade Combat Team with a storied history LTG George Patton was once its regimental commander Soldiers are the most expensive cost element in a tactical unit AMCOS is an Army tool to evaluate cost of military and civilian personnel. We can use it to see just how much soldiers cost. Go to and log in with AKO or CAC
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Accessing AMCOS Show Slide #21: Demonstration Exercise (Cont.)
Facilitator Note: Screen shot shows the home page for AMCOS and the link to AMCOS Lite
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AMCOS Total Cost Data by Rank
$K per Year per Soldier E1 E2 E3 Military Compensation Avg Cost of Base Pay (Military) 17.6 19.7 21.0 Avg Cost of Basic Allowance for Housing (in cash) 8.8 9.6 10.9 Avg Cost of Basic Allowance for Subsistence 4.7 Other Benefits Avg Cost of Other Benefits 2.3 2.5 3.0 Permanent Change of Station Costs Avg Permanent Change of Station-annualized () 0.3 0.4 Recruiting Costs Avg Recruiting Cost for MOS () 24.1 24.2 Retired Pay Accrual Avg Cost of Retired Pay Accrual 5.8 6.5 6.9 Selective Reenlistment Bonus Avg Cost of Reenlistment Bonus (A and B Amortized) 0.0 Separation Costs Avg Cost of All Separation Incentives 1.6 0.5 Special Pays Avg Cost of Special Pays 1.0 1.1 Training Avg Cost of Training (Total Amortized) 6.3 6.4 Total MPA (AMCOS) 72.5 75.4 78.9 MPA $K per Year per Soldier E1 E2 E3 Medical Support Costs Avg Cost of Medical Support Cost 6.7 6.8 6.5 Morale, Welfare and Recreation Costs Avg Cost of Morale, Welfare and Recreation 0.3 Recruiting Costs Avg Recruiting Cost for MOS (Amortized) 6.3 6.4 Training Avg Cost of Training (Total Amortized) 9.7 9.9 9.8 Total OMA (AMCOS) 23.0 23.3 22.9 OMA Show Slide #22: Demonstration Exercise (Cont.) Facilitator Note: Here is some of the data available at the AMCOS site. Total cost of military personnel is: MPA (Military Pay and Allowances) + OMA (Operations & Maintenance, Army) + Other Is it surprising to find that the cost of an E1 is almost $130K per year? other $K per Year per Soldier E1 E2 E3 New GI Bill Costs Avg Cost of GI Bill 30.9 Training Avg Cost of Training (Total Amortized) 3.5 3.6 4.3 Total Other (AMCOS) 34.4 35.1 $K per Year per Soldier E1 E2 E3 Total AMCOS 129.9 133.1 136.9 © Dale R. Geiger 2011
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Total Cost Show Slide #23: Demonstration Exercise (Cont.)
Facilitator Note: Screen shot shows the data entry selections to generate total cost.
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The Composite Standard Rate is Preferred
$K per Year per Soldier E1 E2 E3 Military Compensation Avg Cost of Base Pay (Military) 17.6 19.7 21.0 Avg Cost of Basic Allowance for Housing (in cash) 8.8 9.6 10.9 Avg Cost of Basic Allowance for Subsistence 4.7 Other Benefits Avg Cost of Other Benefits 2.3 2.5 3.0 Permanent Change of Station Costs Avg Permanent Change of Station-annualized () 0.3 0.4 Recruiting Costs Avg Recruiting Cost for MOS () 24.1 24.2 Retired Pay Accrual Avg Cost of Retired Pay Accrual 5.8 6.5 6.9 Selective Reenlistment Bonus Avg Cost of Reenlistment Bonus (A and B Amortized) 0.0 Separation Costs Avg Cost of All Separation Incentives 1.6 0.5 Special Pays Avg Cost of Special Pays 1.0 1.1 Training Avg Cost of Training (Total Amortized) 6.3 6.4 Total MPA (AMCOS) 72.5 75.4 78.9 Composite Standard Rates 42.1, 44.9, 48.5 $K per Year per Soldier E1 E2 E3 Medical Support Costs Avg Cost of Medical Support Cost 6.7 6.8 6.5 Morale, Welfare and Recreation Costs Avg Cost of Morale, Welfare and Recreation 0.3 Recruiting Costs Avg Recruiting Cost for MOS (Amortized) 6.3 6.4 Training Avg Cost of Training (Total Amortized) 9.7 9.9 9.8 Total OMA (AMCOS) 23.0 23.3 22.9 OMA Show Slide #24: Demonstration Exercise (Cont.) Facilitator Note: Sometimes it might be useful to use the total AMCOS personnel cost. Other times it is more useful to use the Composite Standard rates. The composite standard rate ignores the recruiting cost (which seems to be the allocation of a fixed cost), and the amortized re-enlistment bonus, and training costs. These are one-time costs that are averaged across the time periods of service, and may not meet the definition of a relevant cost (one that will change as the result of a decision). other $K per Year per Soldier E1 E2 E3 New GI Bill Costs Avg Cost of GI Bill 30.9 Training Avg Cost of Training (Total Amortized) 3.5 3.6 4.3 Total Other (AMCOS) 34.4 35.1 $K per Year per Soldier E1 E2 E3 Total AMCOS 129.9 133.1 136.9 © Dale R. Geiger 2011
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Composite Standard Rate
Show Slide #25: Demonstration Exercise (Cont.) Facilitator Note: Screen shot shows the data entry selections to generate Composite Standard rate. © Dale R. Geiger 2011
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Individual Exercise in Costing Soldiers of the 3d Armored Cavalry Regiment
The 3d ACR air assets were re-flagged as part of a new Combat Aviation Brigade when the unit deployed A significant sized rear detachment remained at Fort Hood, Texas Use AMCOS to determine the annual cost of the deployed unit and the rear detachment at the composite standard rate Show Slide #26: Demonstration Exercise (Cont.) Facilitator Note: [Note: Click on the thumbnail to view the video.] The 3d Armored Cavalry Regiment is deployed to Iraq (as of spring 2011) A significant sized rear detachment remained at Fort Hood, Texas Use AMCOS to determine the annual cost of the deployed unit and the rear detachment at the composite standard rate given the information in the table. O6 O5 O4 O3 O2 O1 CW5 CW4 CW3 CW2 WO1 E9 E8 E7 E6 E5 E4 E3 E2 E1 total Rear Detachment 2 15 4 3 1 13 53 70 121 176 133 30 19 647 Deployed to Iraq 7 23 57 112 16 14 26 245 430 769 624 21 2544 Total 3d ACR 9 72 116 20 6 39 174 315 551 945 757 87 40 3191
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Teacher’s Note 3d Armored Cavalry Regiment
The 3d Armored Cavalry Regiment is a Heavy Brigade Combat Team deployed to Iraq (as of spring 2011) The Rear Detachment remained at Fort Hood, Texas Rear D Deployed 3d ACR Soldiers 647 2544 3191 $M* 43.1 170.9 214.0 $/Soldier 66.6 67.2 67.1 *At composite standard rate Show Slide #27: Demonstration Exercise (Cont.) Facilitator Note: The students’ results should resemble these (some differences may occur as the AMCOS database is updated.)
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Tactical Unit Cost Management & Control: Non Deployable Soldiers
Throughout the Army many Soldiers are unable to deploy Operational effects can be Under strength units deploying Units deploying with filler personnel Increased deployments for some personnel Reduced dwell to BOG (boots on the ground) time Cost effects involve military pay for limited military work $68 Billion milpay budget in FY11 controlled at Army level Commands, Armies, Corps, Divisions, Brigades, etc see no cost or even budget This means that Soldiers are free goods to their units FY11 milpay cost for non deployable soldiers is in $10 billion range Show Slide #28: Demonstration Exercise (Cont.) Facilitator Note: Operational effects can be Under strength units deploying – because not everyone is ready to be deployed. Units deploying with filler personnel. Increased deployments for some personnel Reduced dwell to BOG (boots on the ground) time. Less time at home, more time deployed. Cost effects involve military pay for limited military work. Full cost, limited benefit. $68 Billion milpay budget in FY11 controlled at Army level Commands, Armies, Corps, Divisions, Brigades, etc see no cost or even budget This means that Soldiers are free goods to their units FY11 milpay cost for non deployable soldiers is in $10 billion range
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3d ACR Non Deployable Cost
Soldiers are not deployable for a number of reasons They still draw full salaries The following are the 3d ACR non deployable soldiers by category as of January 2011 How much do these soldiers cost the Army per year by category at the average composite standard rate for the rear detachment? Show Slide #29: Demonstration Exercise (Cont.) Facilitator Note: Soldiers are not deployable for a number of reasons, but they still draw full salaries The following are the 3d ACR non deployable soldiers by category as of January 2011 The categories are Major medical, upcoming retirement, Cadre, Minor medical, PCS, Legal, TDY, Child care issues, and other. A total of 499 soldiers were non-deployable. How much do these soldiers cost the Army per year by category at the average composite standard rate for the rear detachment? 3d ACR Major Med Retire-ment Cadre Minor Med PCS Legal TDY Child Care Other Total Soldiers 198 64 47 53 8 21 36 499
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Teacher’s Note 3d ACR Non Deployable Cost
Major Med Retire-ment Cadre Minor Med PCS Legal TDY Child Care Other Total Soldiers 198 64 47 53 8 21 36 499 $M 13.2 4.3 3.1 3.5 0.5 1.4 2.4 33.3 Show Slide #30: Demonstration Exercise (Cont.) Facilitator Note: Students’ should get similar numbers. Some differences may occur due to AMCOS database updates.
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3d ACR Non Deployables Non deployable soldier levels are considered a major issue throughout Forces Command Consider the III Corps level of non deployable troops: The 3d ACR Rear Detachment CO, LTC Perry reviewed non deployables weekly Rear Detachment Squadron COs and numerous Rear Detachment staff attend Major Med Retirement Cadre Minor Med PCS Legal TDY Child Care Other Total III Corps 781 718 550 355 350 259 116 72 119 3320 24% 22% 17% 11% 8% 3% 2% 4% 100% Show Slide #31: Identify characteristics of Organization Based Control in real world example Learning Step/Activity #4 Identify characteristics of Organization Based Control in real world example Method of Instruction: DSL (large or small group discussion) Facilitator to Student Ratio: Time of Instruction: 2.0 (Total) Media: Power Point Presentation, Printed Reference Materials Facilitator’s Note: Non deployable soldier levels are considered a major issue throughout Forces Command Consider the III Corps level of non deployable troops, a total of 3320 non-deployables. The 3d ACR Rear Detachment CO, LTC Perry reviewed non deployables weekly. Rear Detachment Squadron COs and numerous Rear Detachment staff attend. The fact that this situation garners leaderships attention on a weekly basis signals its importance.
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7 Feb Review of 3d ACR Non Deployable
Meeting went 90 minutes Much time was spent reviewing a handful of cases LTC Perry learned that Medical appointment issues caused delay Getting signatures added unnecessary delay Time allowed only two of the Squadron COs to speak The review (report?) follows Show Slide #32: Identify characteristics of Organization Based Control in real world example (Cont.) Facilitator Note: This is a brief summary of the 7 Feb review of non-deployables: Meeting went 90 minutes Much time was spent reviewing only a handful of cases LTC Perry learned that Medical appointment issues caused delay Getting signatures added unnecessary delay Time allowed only two of the Squadron COs to speak The review (report?) follows.
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Show Slide #33: Identify characteristics of Organization Based Control in real world example (Cont.)
Facilitator Note: The report goes on for 21 pages and contains over 400 names of nondeployables. Not surprisingly, little was accomplished in addressing the problem of nondeployable soldiers. The reason is that the large quantity of data was not compiled or arranged in a way that was useful or meaningful. © Dale R. Geiger 2011
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Commander’s 7 Feb Review Critique
LTC Perry was unsatisfied with the results of the non deployable review process He recognized that the subordinates were not attacking the problem Instead they were complying with a reporting requirement The pages and pages of detail were data, not information He likened the situation as one of trying to fight the Battle of the Bulge with the following very detailed map Show Slide #34: Identify characteristics of Organization Based Control in real world example (Cont.) Facilitator Note: LTC Perry was unsatisfied with the results of the non deployable review process He recognized that the subordinates were not attacking the problem Instead they were complying with a reporting requirement The pages and pages of detail were data, not information He likened the situation as one of trying to fight the Battle of the Bulge with the following very detailed map
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Battle Map of Ardennes Forest
Show Slide #35: Identify characteristics of Organization Based Control in real world example (Cont.) Facilitator Note: This, of course, is an intentionally ridiculous example. But if every tree in the forest was documented on a map, the map would be useless for understanding the big picture. While it is important for someone to have knowledge of the trees, it is not useful when briefing the Senior Leader.
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Leadership Driven Management
LTC Perry changed the format of the review process to that of an AAR Established his Commander’s Intent as: “look for and resolve systemic issues” Targeted medical profiles over one year and legal chapters over 60 days to be attacked Directed that preliminary meetings occur in the Squadrons Interacted with medical and legal staff on post to enlist their support Show Slide #36: Identify characteristics of Organization Based Control in real world example (Cont.) Facilitator Note: LTC Perry changed the format of the review process to that of an AAR He established his Commander’s Intent as: “look for and resolve systemic issues”. This gave his subordinates over-arching guidance to follow. In addition, he: Targeted medical profiles over one year and legal chapters over 60 days to be attacked. These were the big ticket items where the resolution would have major impact. Directed that preliminary meetings occur in the Squadrons. This accomplished a couple of things – it divided the problem into smaller pieces and allowed closer examination of more individual cases. It also established accountability for the problem at a lower level. Interacted with medical and legal staff on post to enlist their support. Scheduling medical appointments and expediting paperwork for non-deployables would become a priority. [Note: Click on the thumbnail to view the video.]
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3d ACR Rear Detachment LTC Perry AAR HQ Troop Remington 1-3 Tiger Squadron 2-3 Sabre Squadron 3-3 Thunder Squadron 43rd Engineer Show Slide #37: Identify characteristics of Organization Based Control in real world example (Cont.) Facilitator Note: This org chart shows how each squadron would hold a preliminary non-deployables After Action Review and then report up the chain of command to LTC Perry. AAR AAR AAR AAR AAR
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Results of LTC Perry Initiative: March to May Target Areas
Two months Mar 7 May 6 Δ Medical > 365 Legal > 60 Total Delta Tiger 1 20 21 4 5 16 Sabre 15 10 25 Thunder 6 12 18 Remington 3 7 Muleskinner 2 (1) Bullwhip 3d ACR 39 43 82 22 60 Show Slide #38: Identify characteristics of Organization Based Control in real world example (Cont.) Facilitator Note: This chart shows the results by squadron after two months of targeting medical profiles over one year and legal chapters over 60 days.
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Results of LTC Perry Initiative: March to May Target Areas
Two months Mar 7 May 6 Δ Medical > 365 Legal > 60 Total Delta Tiger 1 20 21 4 5 16 Sabre 15 10 25 Thunder 6 12 18 Remington 3 7 Muleskinner 2 (1) Bullwhip 3d ACR 39 43 82 22 60 Show Slide #39: Identify characteristics of Organization Based Control in real world example (Cont.) Facilitator Note: Looking at the bottom line total 3d ACR we see that the 39 medical profiles were reduced to only 2 and the 43 legal chapters were reduced to 20, an overall reduction in non-deployables of 60. At the (lower) composite standard rate, this translates to $4 million dollars annually that has been converted from limited benefit to full benefit. $4M Annualized at Composite Standard Rate
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Opportunities for Improvement
Systemic Improvements Unforeseen Benefits of Accountability Unforeseen Benefits of Creativity Show Slide #40: Identify characteristics of Organization Based Control in real world example (Cont.) Facilitator Note: The systemic improvements came from recognizing the cost involved with non deployable and attacking the root causes. But this is just the tip of the iceberg. There are unforeseen benefits of accountability and creativity that are potentially much greater than the realized $4 million.
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3d ACR Rear Detachment Missions? Support the Field Support the Families Prepare ARFORGEN LTC Perry HQ Troop Remington 1-3 Tiger Squadron 2-3 Sabre Squadron 3-3 Thunder Squadron 43rd Engineer Show Slide #41: Identify characteristics of Organization Based Control in real world example (Cont.) Facilitator Note: The existing org chart presents opportunities for future Organization Based Control applications. How might these accountability relationships be used in the rear detachment’s missions of supporting the field? Supporting the families? Preparing ARFORGEN?
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TLO Summary Action: Define Characteristics of Organization Based Control Condition: You are training to become an ACE with access to ICAM course handouts, readings, spreadsheet tools, and awareness of Operational Environment (OE) variables and actors Standard: With at least 80% accuracy: Describe the difference between Cost Benefit Analysis and Cost Managed Organizations Describe characteristics of Organization Based Control Show Slide #42: TLO Summary Task: Define Characteristics of Organization Based Control Condition: You are training to become an ACE with access to ICAM course handouts, readings, spreadsheet tools, and awareness of Operational Environment (OE) variables and actors Standard: With at least 80% accuracy: Describe the difference between Cost Benefit Analysis and Cost Managed Organizations Describe characteristics of Organization Based Control “Or” Facilitator's at this time, have one learner from each group to explain the most important take away to them from this lesson. Facilitate a discussion on each answer.
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