PROPERTY... ISSN-1072-2858 06.2019 PROPERTY VOL 31 ISSUE 3 PROFESSIONAL THE ALSO IN THIS ISSUE MMAS: What is it and Can You Utilize One? How My Life-long Love of Dance Helped Prepare

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06.2019VOL 31 ISSUE 3

PROPERTYP R O F E S S I O N A L

T H E

ALSO IN THIS ISSUE

MMAS: What is it and Can You Utilize One?

How My Life-long Love of Dance Helped Prepare Me for a Career in Asset Management

Waste, Fraud, Abuse & Mismanagement

Bringing the Remote Team Members Together

THE SCIENCE OF ADMINISTRATION & THE LOGICAL EXTENSION

OF DEBITS AND CREDITS

Now That’s SMART!

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The Science of Administration and the Logical Extension of Debits and Credits08

V O L 3 1 I S S U E 3

COVER STORY

BY DAVID LADOUCEUR, CPPM, LOS ANGELES CHAPTER

S O C I A L

SPECIAL FEATURES

16 Material Management & Accounting System:

What is it and Can You Utilize One?

BY: APRILE BROOKS, CPPA, ROCKET CITY CHAPTER

18 Dancing into My Future: How My Life-long Love of Dance

Helped Prepare Me for a Career in Asset Management

BY: LAUREN BRENNAN, CPPS, JOHNSON SPACE CENTER CHAPTER

22 Waste, Fraud, Abuse & Mismanagement: Are You

on the Lookout?

BY: DIANNA FISHER, CPPM, NOVA CHAPTER

26 Virtually There: Bringing Remote Team

Members Together

BY SCOTT W. PETERSEN, CPPM, DENVER ROCKY MOUNTAIN CHAPTER

28 THE "WHY" of Managing Company-owned

Capital Property

BY TERRI L. SNOOK, CPPM CF, LOS ANGELES CHAPTER

30 Inventory: The Struggle is Real

BY AMANDA ERLER, CPPS

REGULAR FEATURES

04 National President’s Column

05 Editor’s Column

07 Special Interest Groups

15 Connection Corner

25 UC Pomona

32 Ask the Expert

INDUSTRY CHATTER

06 New Maritime Technology for Navy SEALs on the Way

14 Supply Chain News: The Six Key Issues for

Procurement In 2019

21 From Ice Cream to Organs:Five Unusual Items Tracked

by the IoT

31 Industry Insight: How Tech Helps Stretch Asset

Maintenance Talent

EDUCATION AND AWARDS

34 July and August Course Schedule

ADVERTISERS

02 AssetSmart

06 GP Consultants

20 NPMA FES

31 ASTM International

31 KBRwyle

33 NPMA NES

36 Sunflower Systems

C O N T E N T S

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4 THE PROPERTY PROFESSIONAL VOLUME 31, ISSUE 3

As I’m writing this column NPMA has just completed another successful Asset Management Awareness Month. Every March, this month gives us an opportunity to highlight the great things about our profession and some of the many people that make it so excellent. As the month draws to a close, I found myself reflecting on some of the things that makes me passionate about Asset Management.

Asset Management is unique in that it provides us with an opportunity to get a full picture of how an organization functions. An organization’s mission depends on assets, and as stewards of those assets we get the opportunity to interact with all levels and functions of the organization, from executive management down to the people on the ground doing the day-to-day activities. As an Asset Manager, I have had the chance to closely collaborate with internal and external stakeholders, including Procurement, Subcontracts, Finance, Quality, Manufacturing, Contracts, Program Managers, Contracting Officers and auditors, to name a few. There are always new things to learn through these interactions, and this constant supply of fresh knowledge and experience is much more fulfilling than simply performing the same function each day.

One thing that almost all Asset Managers seem to have in common is tremendous pride in supporting the mission of their organization, whether that means serving our men and women in uniform, our scientists and medical researchers, or the state and local governments that serve our communities. Each one of us gets to play a part in this mission, and we often have incredible experiences as a result. I have gotten up close and personal with an operational Space Shuttle, seen the manufacturing of advanced spacecraft and aircraft, witnessed rocket launches, performed physical inventory in the halls of Congress, and more. Being an Asset Manager means getting to be a part of organizations and events that shape our lives, our country, and our world…an extremely rewarding aspect of the job.

Finally, I have found that the opportunity to be a part of the supportive community of Asset Management professionals has been extremely beneficial. To paraphrase one of my friends and mentors, I can’t imagine my career without being a part of an organization like the NPMA. I have learned so much, and continue to learn, by networking and collaborating with other Asset Managers at Chapter meetings, seminars and over email and telephone conversations. The plethora of volunteer opportunities has also helped me develop new skills and career opportunities in ways I never could have imagined. There is truly strength in numbers as an Asset Manager.

I can’t imagine

my career

without being

a part of an

organization

like the NPMA.”

‘‘

NATIONAL PRESIDENT BRANDON KRINER, CPPM, CF

ASSET MANAGEMENT

WWW.NPMA.ORG 5

Many of us have wondered how we got here. We certainly didn’t start out planning to work with property or in asset management! Did you start out being the ‘responsible one’ as I did, or did someone assign property responsibility to you since you ‘already did administrative functions’–another popular ‘beginning’ for an asset management career? However you may have gotten here, you now have the NPMA property accountability passion! What have you learned about assets and management along the way? It really is time for you to share - in writing.

Some of us started on the ‘property’ path working for the military. There are so many useful lessons to be learned there. The many and frequent moves or change of station are a remarkable way to build a broad foundation of property management and accountability knowledge. I began as an Army hand-receipt holder in a youth activity center, then moved to accounting for food stuffs for dining facilities at a Troop Issue Subsistence Activity in Germany. Back in the States, I worked for Facilities Engineering and Housing (FEH) first ordering expendables, consumables and durable items then moving to family and bachelor housing furnishings management. A move back to Germany meant running a Central Issue Facility (CIF) which issued field gear to more than 14,000 military in the installation area, including special operations, aviation, deployment authorizations and space allocation arenas. The next move was to an Army Signal unit supporting the European HQ with installation communications including telephone, electronic, etc. All of these gave me credentials of use when I finally returned stateside to work with two federal civilian agencies, and writing a wide range of policy.

All of this is to say, whether you have had a very deep experience with certain asset management areas or a wide range of experience with asset management related areas you have something to share in our publication. Have you had opportunities to contribute to requirements planning or developed a near foolproof receiving system - let us hear about it? Have you worked out a good way to perform inventories more efficiently and effectively - then tell us? Have you shut down an activity and coordinated the move and disposal of all property, even that which is non-accountable - please share? Maybe you have managed sensitive items, i.e. weapons, Law enforcement (LEO) dogs, horses - we want to hear it! How did you get upper level management to buy into their accountability and responsibility for their organization’s property and what that means to their organization’s success, and in many cases, profitability? We really need to hear from you!

The bottom line is our professional publication needs your article submission support. Publishing your articles will also increase your credentials and enhance your resume. It’s time for you to share…

This issue starts with an in-depth opinion piece on full cost material transfers by David Ladouceur titled "The Science of Administration and the Logical Extension of Debits and Credits"; followed by three articles by first time authors and ending with the second in a series of four articles by Scott Petersen, "Virtually There: Bringing Remote Team Members Together."

Ladies and Gentlemen, we present issue 31-3 of The Property Professional.

A PASSION FOR PROPERTY

EASTERN REGION EDITOR TOBY V. BELL, CPPM

C O N T A C T U S

NPMA NATIONAL OFFICE

3525 Piedmont Rd, Building 5, Suite 300 Atlanta, GA 30305 Tel: 404-477-5811 Fax: 404-240-0998

NPMA NATIONAL OFFICE STAFF

ME! PROGRAM MANAGER: Jennifer (Jen) Sanford [email protected]/MEMBERSHIP SENIOR COORDINATOR: Chris Kadi [email protected] SPECIALIST: Lisa Williams [email protected] MANAGER: Jessie Clevenger [email protected] FLEET CERTIFICATION MANAGER: Rebecca Clusserath [email protected] DIRECTOR: Dimitri Papadimitriou [email protected]

THE PROPERTY PROFESSIONAL EDITORIAL TEAM

NATIONAL EDITOR: Billie Jo Perchla, CPPM, CF [email protected] EDITOR: Keith Record, [email protected] EDITOR EMERITUS: Dr. Douglas Goetz, CPPM, CF [email protected] REGION EDITOR: Scott Petersen, CPPM [email protected] REGION EDITOR: Toby V. Bell, CPPM [email protected] REGION EDITOR: Glenda Steffenhagen-Poole, CPPM, CF [email protected]

NPMA EXECUTIVE BOARD

NATIONAL PRESIDENT: Brandon Kriner, CPPM, CFEXECUTIVE VICE PRESIDENT: Bill Franklin, CPPMIMMEDIATE PAST PRESIDENT: Cinda Brockman, CPPM, CFVICE PRESIDENT ADMINISTRATION: Jessica Dzara, CPPM, CFVICE PRESIDENT CERTIFICATION: Cathy Seltzer, CPPM, CFVICE PRESIDENT COMMUNICATIONS AND MARKETING: Kimberly Saeger, CPPSVICE PRESIDENT FINANCE: Bob Kaehler, CPPSVICE PRESIDENT MEMBERSHIP: Ivonne Bachar, CPPM, CFVICE PRESIDENT PARLIAMENTARY PROCEDURES: Loril Stephens, CPPM, CFVICE PRESIDENT PROFESSIONAL DEVELOPMENT: Tara Miller, CPPM, CFVICE PRESIDENT CENTRAL REGION: Ken Black, CPPM, CFVICE PRESIDENT EASTERN REGION: Wes Carter, CPPM, CFVICE PRESIDENT WESTERN REGION: Amanda Jensen, CPPS

NATIONAL DIRECTORS

AWARDS PROGRAM AND COMMUNICATIONS: Brian Thompson, CPPM, CFCERTIFICATION: VACANTCERTIFICATION GOVERNING BOARD CHAIR: Rosanne "Beth" Green, CPPM, CFCOUNCIL OF FELLOWS CHAIR: Donna King, CPPM, CFFOUNDATION ADMINISTRATOR: Patricia Jacklets, CPPM, CF MARKETING - ASSET MANAGEMENT AWARENESS: Danielle Lyons, CPPS MARKETING - COMMUNICATIONS: Scott Ray, CPPMMARKETING - SOCIAL MEDIA: Angel Rosario MEMBERSHIP - CHAPTER SUPPORT: Kim Kaehler, CPPAMEMBERSHIP - COMMUNICATIONS: Colton Clemmer, CPPSMEMBERSHIP - GROUP MEMBERSHIP OUTREACH: Mike Puryear, CPPM, CFMEMBERSHIP - MEDIA: Scott Petersen, CPPM


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DARPA TO TEST SECUREWARFIGHTER MOBILEDEVICES IN JUNE

NEW MARITIME TECHNOLOGY FOR NAVY SEALS ON THE WAY

By Yasmin Tadjdeh

Navy SEALs — some of the U.S. military’s most elite forces — are tasked with carrying out covert, dangerous and challenging missions across the globe. To assist them, Special Operations Command is investing in new maritime technology that will give them a tactical advantage.

The modernization program seeks to give the shelters a 30 percent increase in payload volume and a 300 percent increase in payload capacity and weight through a series of modifications.

PEO maritime is also looking at developing new training technologies to improve operator performance.

Overall, PEO maritime plans to execute about $1.5 billion over the future years defense program, said Program Executive Officer Navy Capt. Kate Dolloff. It is currently enjoying widespread support in Congress.

The full article can be found at http://www.nationaldefensemagazine.org/articles/2018/6/26/new-maritime-technology-for-navy-seals-on-the-way

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SPECIAL INTEREST GROUPS (SIGS)

SIG HIGHLIGHT -

Changes have come to the SIGS! A review of the SIGS indicated a significant decrease in activity. Postings were far and few between and essentially they were not being used as intended. As a result, Bill Franklin, NPMA Executive Vice President, led an initiative to come up with ways to reinvigorate the environment and re-create a neutral location where members can post their questions and receive guidance from colleagues.

After several meetings, a new plan, focused on open discussion and information sharing, was developed. Rather than have multiple channels, the SIGs transformed into a single forum environment. Unlike the SIGS where we had elected leadership, we now have volunteer moderators, responsible for monitoring forum activity. Some of the SIG leadership transitioned to this role, keeping the expertise they provide in place. The new Member Forum allows anyone to post any question they have and receive a response from any NPMA member. We hope that this new start will be a place for any and all NPMA members to have their property questions answered! Since we have moved to a forum environment, the National Director of SIGs position will be fading away, but in my role as National Director of Membership Communication the new Member Forum falls under my responsibility. I look forward to continuing these articles and supporting our members, just under a different hat.

Scott Ray, CPPM

CHANGES HAVE COME TO THE SIGS!

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today!Join NPMA SIGs to be part of a professional community that advances knowledge, as well as leadership, and provides the tools, resources, and opportunities to enhance and support your professional performance. www.npma.org/SIGs

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Introducing the Main TopicThe purpose here is to discuss the nature of debits and credits, also known as full cost material transfers, while paying respect to Captain Henry Metcalfe (Ordnance Officer, Supply Officer, Leader, Manager, Organizational Theorist, Inventor), who in many ways foreshadowed today’s material

management and accounting system (MMAS).

According to FAR 52.245-1, debits and credits of excess contract acquired property (CAP) are allowed when authorized by the Contracting Officer (CO) i. In contrast, DFAR 252.242-7004 not only allows debits and credits without CO approval, it requires that “the contractor maintain and disclose written policies describing the transfer methodology.” ii In a question raised by Judy Hively regarding debits and credits in an NPMA discussion board, Tom Ruckdaschel and Dr. Doug Goetz agreed. iii

THE SCIENCE OF ADMINISTRATION & THE LOGICAL EXTENSION OF DEBITS AND CREDITS

BY: DAVID LADOUCEUR, CPPM, LOS ANGELES CHAPTER

WWW.NPMA.ORG 9

C O V E R S T O R Y

WALKING AMONGST GIANTSWhile Ruckdaschel said “Generally,

PCO written approval is not required. You would be awful busy if that were the case,” Dr. Goetz said: “The beauty of the MMAS is that it allows you to automatically credit and debit material as long as you comply with the other criteria.” iv In doing so, Dr. Goetz shared an article he wrote with Professor John I. Paciorek titled “The Material Management and Accounting System or Why Hasn’t Anyone Told Property?" v

Much like Dr. Goetz and Paciorek recognized Joseph Orlicky and others, my purpose is to discuss debits and credits while recognizing Captain Henry Metcalfe. Aside from recognizing Captain Metcalfe’s work, the reason for discussing debits and credits or full cost material transfers stems from the primary importance they warrant during predisposal, while so little is written about them.

ESTABLISHING A BASELINEAccording to 52.245-1( j), debits and

credits are allowed for excess CAP of the material classification when authorized by the Contracting Officer (CO). In contrast, 252.242-7004 – the Material Management Accounting System (MMAS) not only allows debits and credits without CO approval, it requires that “the contractor maintain and disclose written policies describing the transfer methodology.” Therefore, how can Contractors perform debits and credits between programs without involving a busy CO when their only defense is the Department of Defense? Before we get there, there is something in 252.242-7004 that needs to be addressed.

Because 252.242-7004(d)(7)(i) specifically states “the Contractor shall maintain and disclose written policies and procedures, describing the transfer methodology and the loan/payback technique” in the same sentence, we need to quickly dispel any notion that these two approaches are the same, because they are not.

While transferring “parts and associated costing within the same billing period” is a fundamental supply management procedure, and therefore, the main topic of this discussion, any suggestion that Contractors should ever entertain a “loan/pay-back technique” may be an ill-advised “off-the-book” transaction that runs counter to property being “accountable to one contract and one contract only.” In their article titled “Acquisition of Property through a Material Management and Accounting System,” Richard Culberson & Wayne Norman addressed this same point. vi

Perhaps the suggestion regarding “loan/pay-back” is confused with a basic

supply management technique of “back filling” requisitions. However, until property is received, it does not get added to the books, and it doesn’t become anyone’s property until it is paid for by the customer. Likewise, if it is meant to be an approach to “rent free non-interference use;” it too would be out of context when involving consumables.

CAN WE GET ON THE SAME SHEET OF MUSIC?

FAR 52.245-1 and DFARS 252.242-7004 differ over how debits and credits should be administered because one requires CO authorization while the other does not. However, before we consider what to do when Government clauses attached to the same contract differ, let’s look at some things within 52.245-1 before moving on. First, let’s begin with an understanding that debits and credits only apply to CAP. Secondly, let’s define CAP.

The reason we need to define CAP is because those writing federal laws or regulations define things as they see them, not necessarily as we see them. Could they do a better job? Perhaps, because sometimes their own definitions confuse themselves. While it’s often understood a word that follows someone’s name or title designates ownership, such as Dick’s Sporting Goods, or Apple Computers, in the FAR, “contractor acquired property” means “Government owned” and “contractor inventory” means “Government owned.” vii viii

For now, these are two definitions that we may have to live with for some time, because unlike many other definitions found in the FAR, the definitions of “contractor inventory” is codified in the Federal Property and Administrative Services Act of 1949.ix Likewise, law can only be introduced, changed, or amended by Congress and the President.x

TITLE TO GOVERNMENT PROPERTY REGARDING CAP

FAR 52.245-1 lays out the scenarios when the Government gains title under cost type contracts. For simplicity, it occurs upon vendor’s delivery,


C O V E R S T O R Y

issuance, commencement of processing or once the Contractor is reimbursed, whichever occurs first. Moreover, in today’s world of automatic debits and credits, title is transferred within two weeks, maybe a month (tops). Nonetheless, while DFARS 252.242-7004 requires Contractors to “transfer parts and associated costing within the same billing period,” what are some ways within 52.245-1 briefly mentioned that allow Contractors to perform debits and credits, provided there is plant clearance approval, but don’t necessarily need the attention of a busy CO?

INHERENT CONFLICTS OR SLIGHT INCONSISTENCIES?

First, they can purchase CAP and make it contractor-owned. Second, they can return it to the vendor. In either case, they both involve debits and credits. Think about how debits and credits happen when you purchase and return something to Lowes, or any retailer. Debits and credits are the basis of everyday accounting.

In regards to Government cost type contracts, whenever material is debited or credited, the acquisition cost as well as all of its burdens, material handling, engineering overhead, and general and administrative (G&A) costs also move with it. In other words, the losing contract is credited with all the costs they were previously debited for per basic cost accounting standards.

Therefore, since 52.245-1 allows the Contractor to purchase or return CAP provided plant clearance approves, then why shouldn’t it allow them to transfer it between programs, when each is made whole? In truth, they can but in a roundabout way. However, before discussing how that’s possible, let’s look at two additional clauses.

TWO CLAUSES OTHER THAN 52.245-1 AND 252.242-7004 JUST TO SHED SOME LIGHT

The NASA and NRO clauses introduced below should provide some additional context to the all too familiar 52.245-1 and 252.242-7004. While the NASA clause mirrors 52.245-1’s standard

allowance to return CAP to stock or stores without CO authorization, the NRO clause not only allows full cost transfers between programs, it doesn’t hesitate to let you know who’s boss.

NASA’S BUZZ LIGHT-YEAR FINANCIAL REPORTING CLAUSE

NASA clause 1852.245-73, titled “Financial reporting of NASA Property in the Custody of Contractors” requires the Contractor to submit a NASA 1018 annually in accordance NFS subpart 1845-71.xi As per 1845-71, the Contractor is required to fully explain any inventory variance that occurs between reporting periods. Under 1845.7101-4, some of the deletions include “transferred to another Government agency” and “purchased at cost/returned for credit.” xii

THE NATIONAL RECONNAISSANCE OFFICE’S SECRET SQUIRREL PROPERTY CLAUSE

The National Reconnaissance Office is an interesting agency because of its role in collecting national security intelligence.xiii However, unlike 52.245-1 or 252.242-7004, its Government property clause N52.245-001, also referred to as the NAM, is not published in the Code of Federal Regulations.

While the NAM begins with the standard caveat “the Contractor shall maintain adequate property control procedures, records, etc. in accordance with 52.245-1 and this clause,” it immediately follows with “If FAR and NAM guidance conflict, the NAM will have precedence.” (Note: While the paper intended to address “rule- making,” for the sake of brevity: When two federal regulations conflict, the agency in question or most effected takes precedence).

According to N52.245-001 (U) (f ) under Property Transfers: “The contractor must obtain approval of both the gaining and losing Contracting Officers or designees before property transfers occur, except for contractor-acquired-material with a unit cost less than $10,000 transferred with an approved Material Management and Accounting System (MMAS). The contractor shall

notify the “Property Analyst” when such MMAS transfers are executed.”

While agencies may establish unique requirements, the NAM still allows Contractors to perform full cost transfers without CO approval (aside from the very liberal $10K “unit cost” versus“total cost.”) Nonetheless, what is most striking is the NAM firmly places oversight responsibility on the “Property Analyst.” (Note: While the paper intended to address the role of DCAA. In their absence, the DCMA Property Administrator should review the Contractor’s MMAS self-assessment and recommend approval if warranted).

While the reporting of full cost transfers would likely be addressed as a contract data requirement list (CDRL), it should be assumed the Contractor will report them annually alongside the often overlooked 252.242-7004(d)(5)’s “reconciliation of recorded inventory quantities to physical inventory by part number on a periodic basis,” which is logically connected to 52.245-1(f )(vii)(C)(1)’s reporting of “reasonable inventory adjustments of material as determined by the Property Administrator.”

Essentially, the reporting of full cost transfers and inventory adjustments should be a part of the Contractor’s annual MMAS review. In return, DCMA Property should promptly review the report and have the ACO approve or disapprove the system within weeks, or 90 days (tops).

While the NASA and NRO clauses were introduced to provide additional context, knowing the terms of each contract prevails because while one contract may allow something the other may not. Nevertheless, while 52.245-1 should be revised to allow full cost transfers without CO approval because it already allows the Contractor to return CAP to stock or stores, it also inconspicuously allows full cost transfers between programs in a roundabout way.

THE LOGICAL EXTENSION OF DEBITS AND CREDITS

Now let's say Tom, Dick and Harry are friends, but while Tom and Dick work in the Government, Harry is one of their contractors. While Tom and Dick cannot

WWW.NPMA.ORG 11

C O V E R S T O R Y

perform full cost transfers between themselves, they can with Harry. In this case, Tom has some excess lumber that Dick needs to finish a project. In what may be referred to as “the logical extension of debits and credits,” Tom can transfer the lumber to Harry at full cost, and Harry can transfer the same to Dick.

Let's say NASA has some excess probe cards that DOE needs to finish a project (keep in mind the Contractor’s role is to make the most “effective and efficient” use of excess material while keeping every other Government program on task, on time, and within budget.) By using “the logical extension of debits and credits,” the Contractor can purchase the probe cards by performing a full cost transfer to a contractor-owned account then transfer them at full cost to DOE. Nevertheless, while the “logical extension of debits and credits” allows Contractors to perform full cost transfers without CO approval, should NASA have to sling shot around Mars to get to the Moon?

IN PRAISE OF CAPTAIN HENRY METCALFE

Captain Henry Metcalfe, Ordnance Officer U.S.A, not only managed supplies and equipment, he knew the laws as they applied to Government property accountability when he published The Cost of Manufacturers and the Administration of Workshops, Public and Private in 1885. This was a time when the American system of manufacturing first came to life inside the armories; beginning at the Springfield Armory in 1777 and its introduction of interchangeable parts in 1795. xiv

In his book titled Classics of Organizational Theory, Jay Shafritz et. al., said:

“Captain Metcalfe urged managers to systematically record production events to control cost. In 1885, Metcalfe published his propositions in The Cost of Manufactures and the Administration of Workshops, Public and Private.

It addressed not only public law and the importance of property accountability but may be considered the earliest version of the Federal Acquisition Regulation's

Cost Accounting Standards. Metcalf also pioneered what may be considered “pre-scientific management” methods to the problems of managerial control and asserted that there is a “science of administration” based upon principles discoverable by diligent observation. Metcalfe is also credited with developing many military inventions such as spring-loaded cartridges designed to increase efficiency and productivity.” xv

Captain Metcalfe on the “Science of Administration:”

“It may be stated as a general principle that while Art seeks to produce certain effects, Science is principally concerned with investigating the causes of these effects. Thus, independently of the intrinsic importance of the art selected for illustration, there always seems room for a corresponding science, collecting and classifying the records of the past so that the future operations of the art may be more effective. The administration of arsenals and other workshops is in great measure an art and depends upon the application to a great variety of cases of certain principles, which, taken together, make up what may be called the science of administration.” xvi

After acknowledging the “Laws pertaining to Government property accountability,” Captain Metcalfe begins his 322-page standard operating procedure (SOP) for material management and accounting on something many Property Professionals are familiar with– the importance of records.

“Now, administration without records is like music without notes--by ear. Good as far as it goes--which is but a little way--it bequethes nothing to the future. Except in the very rudest industries, carried on as if from hand to mouth, all recognize that the present must prepare for the demands of the future, and hence records, more or less elaborate, are kept.”

As equally important to records are standards. “Whatever be the standard of measurement, it suffices for comparison if it be generally accepted, if it be impartially applied and if the results be fairly recorded.” As history shows, Frederick Winslow Taylor followed Captain

Metcalfe’s interest when he published his Principles of Scientific Management in order to find The One Best Way. xvii

As a backdrop, Captain Metcalfe and Frederick W. Taylor were part of a tight knit group known as the American Society of Mechanical Engineers (ASNE), whose members included no less than Thomas Alva Edison. This was the height of the American Industrial Revolution where the primary focus was “efficiency and effectiveness” (two words still viewed as “core principals” of the federal acquisition system.)

Captain Metcalfe also addressed the importance of “efficiency and effectiveness” in “The Shop-Order System of Accounts,” a brief excerpt of his earlier book, which he presented to the members of the ASME at their May Meeting in 1886. Captain Metcalfe said:

“I used to think that only government workshops suffered from circumlocution, and took it granted that private establishments had simple and direct methods of procuring supplies, of keeping track of work in progress and of determining its costs when done. I knew of course, that no shop running to make money could afford to wait, as I have had to do, for the most necessary material, and assumed that in other respects their management was generally on par with their facility in procuring goods. I became convinced that the government methods, though bad enough, were not the only ones to be criticized.” xviii

In The Visible Hand: The Managerial Revolution in American Business, Alfred D. Chandler said:

“Metcalfe's shop-order system of accounts made it possible to control the flow and improve basic cost accounting. In the new system that Metcalfe proposed, each material requisition or transfer be recorded on a separate 'shop order card,' which included spaces for pricing the article and for the job number to which it was charged. To assign labor costs, each workman was given a book of cards, and as he moved from job to job, he noted the time spent on each to the nearest quarter day. In this way, a written record of costs


literally followed the work through every factory department. The information from this card system was the input for Metcalfe's system of cost accounting. The data is then used to determine for each department the 'indirect expenses' or overhead costs, as well as the 'direct expenses' or prime costs.” xix

Captain Metcalfe’s card system brought a revolutionary change to the practice recording shop orders in notebooks that were difficult to share between the foreman and front office. In addition to creating a simplified card system that assigned work to projects, his approach towards general and administrative expenses was expressed as follows:

“Factories are established for the profitable transformation of material by the organized employment of labor. When considering how the indirect expense shall be distributed, in ratio to the material or to the labor, by quantity, or by value, I reasoned that since incidental expenses are incurred for the purpose of making labor more effective, and that as more material enters as their divisor, the more it vitiate the probability of the result, then general and administrative expenses should be applied to labor. For the more men employed, irrespective of their cost, the greater is the wear and tear, the waste, the cost for room, light, heat, attendance, etc.” (Note: Today, G&A in part is an allowable indirect cost that is automatically applied at the end of each billing cycle).

Captain Metcalfe also had a good sense of material requirements planning MRP well before the term was coined.

“As a manufactory, it requires a certain record of all orders for fabrication, with a prompt and accurate return of their completion. Also, a ready reference to work in hand, so that a general idea of its duration may be had; and a ready reference to work not yet begun, so that labor awaiting employment may be at once be directed to its proper object.”

Captain Metcalfe understood the importance of performing debits and credits to fill more urgent need, while keeping projects on time and within budget.

“Suppose that we are making cartridges under No. 107, and an order, No. 767,

comes to issue 1,000 bullets of the same kind we are making. We have a supply on hand, under No. 107, which is more than is required for immediate wants. So we do not go to making bullets specifically for No. 767, but borrow from No. 107 the 1,000 wanted, crediting No. 107, and charging No. 767 with the nearest approximation to their actual value. 1,000 more bullets will be required for No. 107, but these being made with a flying start, will be more economically made that if the machinery of record, like that of any manufacture, had been stopped and set to work again for their special benefit.”

Captain Henry Metcalfe is recognized for his genuine appreciation for Government property accountability, for his views on the “science of administration,” for highlighting the value full cost transfers, for establishing a time and material card system, for establishing a basis for factoring G&A costs, and for writing one of the most definitive works ever published on material management and accounting.

THE ADVANTAGES OF DEBITS AND CREDITS

So, what are the advantages of debits and credits?

1. They are fair and equitable; no one gets a free lunch. One customer doesn’t benefit at the expense of another;

2. They are used to fill more urgent needs, reduce long lead times for material, and keep programs on schedule;

3. They make the most “effective and efficient” use of excess or residual material- a first source of supply;

4. They form the basis of basic accounting practices used world-wide;

5. They are approved internally by program management provided the applicable forms and instructions adequately describe the transfer methodology;

6. The transaction is performed with a simple keypunch stroke or click of a mouse when using standard enterprise resource planning (ERP) software;

7. All transaction history is easily obtained by reviewing the general ledger and project cost reports.

C O V E R S T O R Y

*Figure 1. Photograph of Captain Henry Metcalfe retrieved from http://www.goordnance.army.mil/hof/ 1969/metcalfe.html

* Figure 2. The Material Card designed by Captain Metcalfe had many uses; example here shows “Transferring Material between Shop-Orders retrieved from https://ia601407.us.archive.org/11/items/costofmanufactur00metc/costofmanufactur00metc.pdf.

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FINAL THOUGHTS AND CLOSING REMARKS

In sum, because 52.245-1 already allows CAP to be returned to stock or stores, provided it has plant clearance approval, CO authorization should not be required to transfer CAP between programs when both program managers agree, when each is made whole. While the “logical extension of debits and credits” also allows Contractors to perform full cost material transfers, Contractor’s shouldn’t have to go to all those lengths.

Instead, Contractors may perform full cost transfers provided they have written procedures that describe their transfer methodology coupled with a Disclosure Statement that describes

how they assign costs. They should also review their MMAS annually and report their results to their Property Administrator. Finally, they should reference their MMAS procedures in their Property Management Plan.

After all, this is essentially how Contractors are also allowed to dispose of production scrap without reporting it to plant clearance. As per 52.245-1( j)(3)(ii), “the Contractor need not identify or report production scrap on inventory disposal schedules, and may process and dispose of production scrap in accordance with its own internal scrap procedures”. They do so by writing the process into their procedures and having it approved.

Again, it was an honor and a privilege to recognize Captain Henry Metcalfe for his genuine appreciation for Government property accountability, for his views on the “science of administration,” for highlighting the value of full cost transfers, for establishing a time and material card system, for establishing a basis for factoring G&A costs, and for writing one of the most definitive works ever published on material management and accounting.

While it is always good to hear the thoughts of great men from the distant past, his words served and continue to serve as a guiding light. Therefore, just as the writings of Clausewitz or Sun Tzu are required readings for Command and Staff and the War Colleges, Captain Metcalfe’s book on the The Cost of Manufacturers and the Administration of Workshops, Public and Private should be a required reading by DAU, NPMA, or anyone interested in Government property.

REFERENCESi 48 CFR 52.245-1. Government Property. 2017; Available from: https://www.law.cornell.edu/cfr/text/48/52.245-1.ii 48 CFR 252.242-7004. Material Management and Accounting System. 2017; Available from: https://www.law.cornell.edu/cfr/text/48/252.242-7004iii Hively, J., Ruckdaschel, T., & Goetz, D. MMAS- Debit/Credit. 2015; Available from: https://www.npma.org/blogpost/1273680/229642/MMAS--Debit-Credit?hhSearchTerms=%22debit+and+credit%22&terms=.iv Ibidv Goetz, D., & Paciorek, J. The Material Management Accounting System or Why hasn't Anyone Told Property? 1990; Available from: https://cdn.ymaws.com/www.npma.org/resource/resmgr/AssetArch/Goetz-90.pdfvi Culbertson, R., & Norman, W. Acquisition of Property Through a Material Management and Accounting System (MMAS). The Property Professional 2014 [cited 26 1]; 8-15]. Available from: https://cdn.ymaws.com/www.npma.org/resource/resmgr/AssetArch/MMAS_-_Culbertson_Norman.pdfvii 48 CFR § 52.245-1(a). Definitions- Contractor inventory. 2017; Available from: https://www.law.cornell.edu/cfr/text/48/52.245-1. viii 48 CFR.§52.245-1(a) Definitions- Contractor –acquired property. 2017; Available from: https://www.law.cornell.edu/cfr/text/48/52.245-1.

C O V E R S T O R Y

Material Transfer Formin accordance with Supply Management Procedure 101, this form is used for approving inventory transfers between projects.

The transfer take s place in the MMAS after all required signatures are obtained.

Name of Person Making the Request: ___________________________________

Reason for the Request: ______________________________________________________________________________

__________________________________________________________________________________________________

is this a $0 Cost or FUll Cost Material Transfer? ______

Part # Rev # Serial # Description Qty Unit Cost Total Cost From Poject Inv Abbrev To Project Inv Abbrev

*if additional parts are needed, ref attached spreadsheet. Total Cost: ________

Signature Approvals:

________________________________ ___________________________________

Program Manager (From) Program Manager (To)

________________________________ ___________________________________

Finance / Accounting / Program Control Contract Administrator

(Confirms Projects are set in the MMAS to allow Cost Transfers) (Confrims Compliance with Contract Terms)

Supply Management

Does the Unit Costs in the MMAS match all Costs identified? _____ If not, return form to the requester.

If this is a $0 Cost Transfer, ensure the appropriate transaction is entered to prevent unauthorized billing.

Inventory Transfer Transaction ID: _________________________

Inventory Transaction Date: ____________

Has the material or its packaging been remarked to show new ownership?_____

Has the material changed location? ____ If so, update all locations.

Initials: _______

* Figure 3. A blank Material Transfer Form that may be used today that is not much different than Captain Metcalfe’s original design, except for its single purpose use and a few additional considerations added by the author here.


Graham Crawshaw of CASME, a membership association of global procurement professionals, recently published his list of six key issues on the web site of CIPS, basically the UK version of the USA's Institute for Supply Management (ISM).

There are no real surprises here, but the six top issues make an interesting read nonetheless.

1. RISK MANAGEMENTRisk is always a key concern for procurement, with the primary focus on suppliers' financial status, followed by health and safety and industry practices.

2. REPUTATION AND BRAND IMAGEIt's not difficult to recall allegations of child labor in the overseas supply chain of certain retail brands, or issues around modern slavery both at home and abroad.

3. CSRCan procurement ever be sustainable? Organizations are making tremendous progress in the approach to direct materials, but indirect procurement is more complex.

4. BECOMING A CUSTOMER OF CHOICE Innovation is often included in an RFP, but does not necessarily specify what is really needed.

5. CENTERS OF EXCELLENCEThe trend towards a centralized organization to support the procurement function is on the rise, with an emphasis on provision of spend data and analysis, plus RFx e-sourcing support.

6. STAKEHOLDER ENGAGEMENTAt almost every one of CASME's meetings held each year, the discussion includes procurement's need for achieving greater connections with stakeholders.

The full article can be found at http://www.scdigest.com/ontarget/19-02-20-2.php?cid=15209

SUPPLY CHAIN NEWS:THE SIX KEY ISSUES FOR PROCUREMENT IN 2019

ix 40 U.S. Code § 102. Definitions. 2002. Available from: https://www.law.cornell.edu/cfr/text/40/102 x The Constitution of the United States. Article I, Section 7. 1789; Available from: https://www.law.cornell.edu/constition/articleixi 48 CFR § 1852.245-73. Financial reporting of NASA property in the custody of contractors. 2017; Available from: https://www.law.cornell.edu/cfr/text/48/1852.245-73xii 48 CFR § 1845.7101-4. Types of deletions from contractor property records. 2002; Available from: https://www.law.cornell.edu/cfr/text/48/1845.7101-4xiii National Reconnaissance Office. Who We Are. 2019; Available from: https://www.nro.gov/About-the-NRO/The-National-Reconnaissance-Office/Who-We-Are/xiv Rubis, K. The History of Ordnance in America. Army Sustainment 2012[cited 44 3]; Available from: http://www.alu.army.mil/alog/issues/MayJune12/history_ordance.htmlxv Shafritz, J.M., Ott, J. S., & Jang, Y. S., Classics of Organization Theory. 8th ed. 2016, Boston, MA: Cengage Learning.xvi Metcalfe, H. The Cost of Manufactures and the Administration of Workshops, Public And Private. 1885; Available from: https://ia601407.us.archive.org/11/items/costofmanufactur00metc/costofmanufactur00metc.pdfxvii Taylor, F.W. The Principles of Scientific Management. 1911 1916; Available from: https://wwnorton.com/college/history/america-essential-learning/docs/FWTaylor-Scientific_Mgmt-1911.pdfxviii Metcalfe, H. The Shop-Order System of Accounts. Transactions of the American Society of Mechanical Engineers 1886[cited 7; 440-488]. Available from: https://archive.org/stream/transactionsof07amer#page/440/mode/2up.xix Chandler, A., D. The Visible Hand: The Managerial Revolution in American Business. 1993; Available from: http://www.hup.harvard.edu/catalog.php?isbn=9780674940529

ABOUT THE AUTHOR:

David Ladouceur is a retired Marine Corps Supply and Fiscal Officer. Since retiring from the Marine Corps in 2006, he has worked as a Government Property Manager for CACI, Lockheed Martin, and now Teledyne Scientific & Imaging. David has a B.A. from the University of California at Los Angeles (UCLA), a M.A. from Troy University, and is currently pursuing his Doctorate in Business Administration with Colorado Technical University. He is a Certified Professional Property Manager (CPPM) and proctors exams for aspiring Property Professionals. David currently lives in Ventura, California and enjoys surfing on the weekends.

C O V E R S T O R Y

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Connection Corner is a new column in The Property Professional designed for Chapters to share information with the membership. In this issue, we interviewed Chapter President, Robert Koop, from the Ohio Valley Chapter. The Ohio Valley Chapter is a Medium chapter in the Eastern Region with 60 active members.

1. Tell us a little bit about the Chapter Workshop you hosted?

The Ohio Valley Chapter hosted a One-Day-Seminar on March 26, 2019, at the University of Dayton Research Institute, attended by 50 people and comprised of 11 speakers. Since the event took place in Dayton Ohio, the birthplace of aviation, we aptly titled the event "Property and Assets Take Flight." We wanted the seminar to look and feel like a regional event and I believe we came close to achieving that goal. We hosted three tracks: Contract, University, and NASA property in order to appeal to a wide audience.

2. What are some advantages of hosting a Chapter Workshop?

My goal as Chapter President is to determine what our chapter members need, then position the chapter to deliver on those needs. An informal survey indicated a desire for local training so the chapter leadership was tapped to identify resources within our Chapter or external to the Chapter but within a reasonable reach. A secondary goal was to establish a scholarship program where our smaller businesses who employ property professionals and support NPMA with a membership can further their

professional development by attending the educational seminars when the business cannot afford to do so. A robust scholarship program needs to replenish itself regularly so I am hoping this event continues on an annual basis.

3. What are some of the Lessons Learned/Advice you would want to share with other chapters wanting to host a Chapter Workshop?

Even a one-day seminar is a LOT of work and it is important to not put all the effort on one or even a few people. We drafted a plan one year out, then put it on hold until after NES when we picked it up again... meeting weekly to make sure we were on track, and constantly asking ourselves "What are we forgetting?” We started with an outline and a budget estimate from another Chapter, so first word of advice, do not start from scratch, and call me for our outline. Secondly, in order to get the organizational experience built into our membership, we made a decision to run this event at a loss if needed. This kept us

from constantly looking over our shoulder and checking the registration list. Third, sponsors can go a long way to relieving pressure and financial risks. So everyone needs to visit every sponsor at every NPMA event, show your appreciation, because someday your business is going to need help and they are the ones who will provide that help. Having them in your network is the intangible value you cannot live without! And by the way, our chapter made a profit from hosting the workshop to support our scholarship program in the future.

BRINGING CHAPTERS TOGETHER

Share Your Story

WANT TO SHARE SOMETHING FROM YOUR CHAPTER?Email Kim Saeger, VP of

Marketing & Communications at [email protected] today!

EMAILUS

ConnectionCORNER


MATERIAL MANAGEMENT & ACCOUNTING SYSTEM

WHAT IS IT AND CAN YOU UTILIZE ONE?By: Aprile Brooks, CPPA, Rocket City Chapter

You may have heard the term Material Management and Accounting System, or more simply stated…MMAS. What is it, and how can it be used when managing a company’s material source?

Per Defense Federal Acquisition Regulation Supplement (DFARS) clause 252.242-7004 “Material Management and Accounting System,” a MMAS is a “contractor’s system or systems for planning, controlling, and accounting for the acquisition, use, issuing, and disposition of material.” Material management and accounting systems may be manual or automated. They may be stand-alone systems or they may be integrated with planning, engineering, estimating, purchasing, inventory, accounting, or other systems.” In order to utilize a MMAS, a contractor must first be audited by an external agency, normally Defense Contract Audit Agency (DCAA) and/or Defense Contract Management Agency (DCMA), and receive an adequate (or approved) rating for the system put in place. It is

important to note that the actual approval for a MMAS will come from the Administrative Contracting Officer (ACO), who has the authority to approve the six business systems listed in DFARS 252.242-7005 “Contractor Business Systems.” The external auditor will provide his/her determination of system rating to the ACO, who will then deem the contractor’s system as adequate or inadequate. It is essential to understand the scope of a MMAS, as the system will accommodate a company’s portfolio of contracts, all having different customer bases/agencies and contract types.

A MMAS will permit a contractor to utilize a reduced material inventory to become more efficient and effective in the amount of material on hand. This will allow the contractor to reduce inventory costs (facility, storage, and physical inventory requirements), while also releasing materials to contract projects on an as-needed basis, thus reducing the costs to the customer.

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At any time, a MMAS is never applicable to Government-furnished property (GFP); it is only allowable for Contractor-acquired property (CAP), Fixed Price inventory that is applicable to Progress Payments, and contractor inventory. It is not allowable for contracts awarded to small businesses, educational institutions, or non-profits.

MMAS 10 KEY STANDARDS – CRITERIA TO POSSESS AN APPROVED SYSTEM

DFARS 252.242-7004 lists the ten standards that a contractor must show evidence of mastering before being provided an approval rating. Each one is described below*:

1. Adequate System Description – policies, procedures, and operating instructions that are in compliance with both the Federal Acquisition Regulation (FAR) and the DFARS;

2. System Accuracy – purchased and fabricated material charged/allocated should be based on valid time-phased requirements with a goal of: a. 98% bill of material accuracy, and b. 95% master production schedule accuracy

3. System Weaknesses – identify, report, and resolve system control weaknesses;

4. System Records and Audit – maintain records that show system logic and be able to verify through transaction testing;

5. Record Accuracy – maintain accuracy and include reconciliation of recorded inventory quantities to physical inventory by part number with a goal of 95% accuracy; if below the 95% accuracy goal, the contractor must show evidence that there is no material harm to the Government and the cost to meet this goal is excessive in relation to Government impact;

6. Transfers – provide detailed descriptions of circumstances that would result in a manual or system generated transfer of parts;

7. Material Transaction Costs – be consistent, equitable, and use unbiased logic for costing of material transactions (see clause for more detailed instructions);

8. Common Inventory – when pulling from a common inventory, have controls in place to show reallocations/credit fall within the routine billing cycle, inventory retained for requirements are not allocated, and algorithms are maintained based on valid data;

9. Commingling of Property – CAP and Progress Payment inventory can now be comingled (remember, this is not applicable to GFP);

10. Internal Audits – hold yourself accountable through periodic internal audits

*NOTE: These ten standards, otherwise known as ‘system criteria’, discussed above are found in DFARS 252.245-7004(d), “Material Management and Accounting Systems”, which provides more specific language.

WHAT ARE THE IMPLICATIONS OF A MMAS?If a contractor has been provided with an approval to use

its established MMAS, the contractor normally is no longer authorized to utilize a Receipt and Issue system, meaning it will not be allowed to receive material and immediately issue to the program for consumption. Acquiring and consuming material will have to be controlled and maintained within the approved MMAS.

Additionally, when the MMAS clause is flown in a contract, and the contractor does NOT have a MMAS in place and/or approved, the contractor should request the removal of the clause inclusion. Program personnel should also be aware that all property acquired on a contract must solely be utilized on that contract unless otherwise previously authorized by the CO.

What if a contractor has a previously approved MMAS and it is found to be deficient by an external audit agency? The answer is not a desirable one. As the MMAS is one of the six Contractor Business Systems, it can cause a withholding of payments if found to be inadequate/deficient. This is after certain criteria is not met, such as contractor response to the finding(s) is not deemed as sufficient in returning the MMAS back to an approved status. Refer to DFARS 252.242-7005 “Contractor Business Systems” for Withholding details:

1. 5% for one or more significant deficiencies in a single business system;

2. 10% for significant deficiencies in multiple business systems.

It is equally important to note that even though a MMAS is a separate system from a Property Management System, the two are very relatable and can have similar findings or deficiencies during a review. Additionally, a MMAS is managing Government/contract property; therefore, a MMAS does affect a property system’s success (or failure). This may also have overarching effects to the other business systems thereby resulting in strong operational and financial impacts.

SUMMARYMaterial Management and Accounting Systems are very

advantageous for contractors in a multi-contract manufacturing environment. However, contractors have to meet the criteria discussed previously, which is mandated by Federal regulations. This would also require the contractor to have very detailed systems and processes in place, as well as successful testing and documentation of said processes, in order to move forward with a MMAS application. Contractors should be aware of the up-front exercises to be expected when pursuing a MMAS review, as well as take action when the clause is flown into contracts when a MMAS is not available, nor in use.

REFERENCESDFARS 252.242-7004 “Material Management and Accounting System,DFARS 252.242-7005 “Contractor Business Systems”,DFARS Subpart 242.72 “Contractor Material Management and Accounting System”

ABOUT THE AUTHOR

Aprile Brooks, CPPA, is from Huntsville Alabama. She is a Senior Contracts Property Advisor at General Dynamics Information Technology (GDIT) and has 14 years of experience in the Property Management profession. Aprile is active in the Rocket City Chapter and holds a Bachelor of Science degree in Management Information Systems, as well as a Master of Science degree in Management of Technology – both from The University of Alabama in Huntsville.


Growing up I had my life planned out; I would move to New York City and be a professional dancer. Life was simple. After school, I would spend hours in the studio perfecting my craft. I studied numerous dance styles: ballet, jazz, modern, African, hip-hop, tap, salsa-- you name it, I tried it…class after class, rehearsal after rehearsal, performance after performance. Dance was my life.

After college graduation I made the move. My parents and I packed up the minivan and hit the Jersey turnpike en route to my new apartment in New York City. My first night living in the city I thought, “This is it…this is what all my training, all my hard work has been for.” I wish I could write that I auditioned and was accepted into one

of the prestigious modern dance companies in NYC, but this isn’t one of those stories.

My love-hate relationship with New York City started to wear on my passion for dance. While I was able to work with several small dance companies, traveling throughout the city, performing in front of audiences, it was not enough. Over the years, the daily grind of working in a restaurant to pay rent was not what I wanted in life. I needed more purpose. The emptiness I started to feel eventually led to the hardest decision of my life: leaving The City.

While physically moving out of New York was easy, mentally leaving was tough. This decision meant I was leaving dance, leaving the life I had prepared for, which left me

with so many questions. Now what? What does a dancer do after dance? How do I use my skill set? Do I even have a skill set?

I bounced around various jobs, never quite finding the right fit, until I landed in the world of asset management. I cannot say everything clicked right away, in fact, far from it. On day one I felt as though everyone was speaking a foreign language; procurement, acquisition, receiving, reutilization, disposition…what? I was smiling and nodding but meanwhile in my head thinking, “What is an asset again?” While I was trying to wrap my head around these new concepts, it clicked. I realized all of my training and dedication did prepare me for my career, but for much more than just dance.

DANCING INTO MY FUTUREHOW MY LIFE-LONG LOVE OF DANCE HELPED PREPARE ME FOR A CAREER IN ASSET MANAGEMENT

By Lauren Brennan, CPPS, Johnson space Center Chapter

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I’ve spent most of my life learning another language. There is a language in the art of dance, crafted through a vocabulary of movement and how that movement relates to the music. A dancer must learn this language and express it with a fluency that the audience can comprehend.

Part of the language of dance is expressed through the relationship of movement to music. While dancers do not have to read music, they must learn and understand rhythm, tempo and timing. Dancers need to understand if the choreographer intends for the movement to be in harmony with the music, showing happiness or peace, or does the choreographer want to show juxtaposition, having the movement express anguish, fear, or wrath. The relationship between the music and the movement can help tell a story and convey the choreographer’s message.

I realized my immersion into the world of asset management was key in learning the ‘lingo’ and frankly, being able to understand what was being said to me. Learning my client’s business processes, it was important to not be afraid to ask questions, ask for clarification if needed, and take the time to absorb the information. Getting more involved in NPMA, specifically going through the CPPS certification process was extremely beneficial in not only learning the language of asset management, but truly understanding asset management concepts. As with dance, the ‘language’ is more than the words themselves.

When learning the movement vocabulary of a piece it is critical for dancers to pay attention to the details. Does the count start on the beat or on the offbeat? Is the foot pointed or flexed? Where do your head, arms, and legs go? How long do you hold the relevé (a ballet position)? Dancers have to capture the nuances within the movement and commit them to memory instantaneously. The details of the choreography shape the piece and bring the dance to life. Dancers must read and interpret the movement as the choreographer intended, as any variance can alter the vision of their work.

With managing and tracking assets, it is vital to understand the importance of details needed to capture specific pieces of information. It is the details -- how was the asset acquired, what happens to the asset during its lifecycle, and ultimately how the asset is disposed -- which make up the complete audit trail for the asset. Similar to dance, the details paint the complete picture.

Dancers must constantly undergo self-assessments. A dancer’s body is his or her livelihood and knowing how to take care of your body is crucial. There must be a physical understanding of both your body and your mental state. There are many days a dancer has to fight muscle fatigue, so you must know when to push through or when to take it easy and prevent injury. On days with long rehearsal, especially nearing a performance, it is important to assess your mental and emotional health to ensure you have the stamina to endure. No one knows your body like you do, so dancers must listen to their bodies and take the feedback seriously.

Physical inventories provide an organization a self-assessment, and a way to ensure that your organization is financially responsible and compliant with external governance, contractual agreements and audit regulations. It identifies issues with asset receiving and issuance, loss or theft, and records management. Inventories drive data standardization and sound financial management practices across the organization. Like dancers, self-assessment is critical in maintaining the health of an organizations asset management.

When learning a new piece of choreography it is important for dancers to analyze the movement and identify patterns in the combinations and phrasing. Often (intentional or not) there is a motif throughout the choreography. The pattern could be the actual movement, like repeating steps, or in the phrasing of tempo -- quick, quick, slow… quick, quick, slow. Dancers knowing what to look for when identifying patterns provide efficiency allowing them to absorb and memorize the choreography faster.

Accurate data establishes the foundation for an organization’s reporting and analysis. Beyond the data itself, effective analytics involves a variety of reporting techniques which provides an organization with valuable information to assist in making insightful business decisions. Reports concerning acquisitions, inventory on hand, and dispositions can reflect the overall efficiency, or inefficiency, of asset management processes. As with dancers, it is important for property professionals to analyze available data on a constant basis to track trends and areas needing improvement.

The ability to anticipate is an extremely useful tool for dancers. Timing and space are huge factors in class, rehearsal, and performance, particularly with regard to fellow dancers. It is important to anticipate where in space your movement will take you, as well as where other dancers are in the space. As much as dancers rehearse what happens on the stage can be unpredictable. If I realize I am ahead of the music I have to be able to anticipate where in the choreography I can let the movement breathe, taking more time and allowing the music and dance to synchronize.

DANCING INTO MY FUTUREHOW MY LIFE-LONG LOVE OF DANCE HELPED PREPARE ME FOR A CAREER IN ASSET MANAGEMENT


Based on analysis, property professionals must plan and anticipate business needs. Does your organization need to purchase more or is there a surplus of assets? Is your organization able to reutilize assets to cut down on spending costs? The accuracy and comprehensiveness of information available are core factors when an organization makes planning, budgeting, and forecasting decisions. By having an asset management and reporting system in place that provides both relevant and accurate information, property professionals are set up with the proper tools to make these decisions. Similar to dance, accurate anticipation, or forecasting, will create an environment where organizations can make thoughtful and informed decisions.

Dance is an ever-changing, ever-evolving art form. Dancers must progress with the changes as versatility can set a dancer apart. While a dancer does not have to master every dance style a smart dancer invests in learning various genres of dance and different techniques within the genre. On top of studying dance styles it is good

for dancers to observe fellow dancers on different ways to approach movement. Is their quality of dance light and airy, keeping their center of gravity high, or do they have a grounded approach, utilizing their plie, and keeping their center of gravity low? It is important for dancers to always continue to learn and keep an open mind about how to approach movement. Having an understanding of different techniques will help prepare dancers to execute any choreography presented to them.

In order to remain relevant in the asset management world, organizations must be flexible and respond to industry changes. Property professionals must continue to re-evaluate business procedures or governing documents to keep up with the organization and industry evolution. It is imperative for organizations to adapt to industry trends and adjust processes for changes in applicable rules and guidelines. Same as dancers, asset managers must show continuous improvement.

I have to admit that I never thought I would find so many similarities between the art of dance and the discipline of asset

management, but after looking a little closer I realized there is so much that I have taken from my dance background and applied to my career in asset management. My show is definitely not over—it’s really just beginning!

ABOUT THE AUTHOR

Lauren Brennan, CPPS, is a Business Analyst with Sunflower Systems and a member of the NPMA’s Johnson Space Center Chapter. She provides asset management expertise, to include support, training, and maintenance activities for Federal government customers.

hosted by:

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Save the Date:November 13-14, 2019Crowne Plaza San Francisco Airport

FEATURED EDUCATION TRACKS: Compliance and Policy Best Practices

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The Internet of Things (IoT) is typically associated with smart homes or vehicles. One compelling, and perhaps lesser known, use case for the IoT is asset tracking. The IoT can enable items to be tracked anywhere, any place, at any time. It can also provide information about an item's state and environment, including the level of humidity or light exposure, or any evidence of tampering.

ICE CREAMThose in the business of selling and shipping ice cream face quite a logistical challenge: how to transport the popular icy desert across the terrains of varying climates. No one likes melted ice cream, especially not when it hits profit margins. If ice cream arrives at its destination spoiled, it could cost the manufacturer thousands of dollars. Therefore, it's important to be aware of temperature changes during transit.

VACCINES AND MEDICINESThe pharmaceutical sector ships time-critical and extremely sensitive assets. Take vaccines, for example. Pharmaceutical companies must now ensure that a shipment of vaccines is closely monitored and secure in order to ensure its safe arrival at its destination, wherever in the world that may be.

ORGAN TRANSPLANTSIt is hard to think of a more precious and time-sensitive delivery to track than blood or organs s cheduled for transplant. In addition to monitoring temperature and other environmental variables, tracking can enable vital minutes to be saved.

EXAM PAPERSThe delivery of exam papers is not a particularly risky business. However, returning the completed answers from students is a different story! It is not uncommon for sacks of completed examinations to go missing if they are not tracked.

HUMAN REMAINSLastly, and perhaps most sobering, is the use of the IoT to track the transportation of human remains. For example, at companies that specialize in turning ashes into precious jewelry, IoT technology can assist the accurate tracking of such a sensitive cargo.

The full article can be found at https://www.rfidjournal.com/articles/view?18352/

FROM ICE CREAM TO ORGANS:FIVE UNUSUAL ITEMS TRACKED BY THE IOT

By Mohsen Mohseninia and Richard Jennings


WASTE, FRAUD, ABUSE & MISMANAGEMENTARE YOU ON THE LOOKOUT?

By: Dianna Fisher, CPPM, NOVA Chapter

WWW.NPMA.ORG 23

Waste, fraud, abuse and mismanagement – it’s a phrase that can be heard throughout the Government and contracting arena but do we really know what it is? Moreover, why do we care?

Let’s analyze this subject piece by piece to see if we can get both a better understanding, comprehension, and appreciation, as well as spot it when we see it. Then, learn how to deal with it when we do.

First, let us walk through the definitions of each as put forth by either the Government Accountability Office (GAO) or Black’s Law Dictionary.

“Waste is the squandering of money or resources, even if not explicitly illegal.” i That which involves taxpayers not receiving reasonable value for money in connection with any Government funded activities due to an inappropriate act or omission by players with control over or access to Government resources (e.g. executive, judicial, or legislative branch employees, grantees or other recipients). Importantly, waste goes beyond fraud and abuse and most waste does not involve a violation of law. Rather, waste relates primarily to mismanagement, inappropriate actions and inadequate oversight.

“Fraud is attempting to obtain something of value through willful misrepresentation.” ii

Or, according to Black’s Law Dictionary, it is an intentional perversion of truth for purpose of inducing another in reliance upon it to part with some valuable thing belonging to him/her or to surrender a legal right. A false misrepresentation of a material fact, whether by words or by conduct, by false or misleading allegations, or by concealment of that which should have been discussed, which deceives another so that he/she acts or fails to act to one’s detriment/legal injury. iii

“Abuse is behaving improperly or unreasonably or misusing one’s position or authority.” iv To make excessive or improper use of a thing, or to employ it in a manner contrary to the nature or legal rules for its use, including an extravagant or excessive use. Further elaboration to define is the behavior deficient or improper when compared with that which a prudent person would consider a reasonable or necessary business practice given facts and circumstances. Abuse does not necessarily involve fraud, violation of laws, regulations, or provisions of contracts. v

Mismanagement is the more recently added term to the three aforementioned concerns and is defined as the “creating of a substantial risk to an agency’s ability to accomplish its mission.” vi It is imperative to align this with the overall topic herein as it is directly tied and attributable to the management and control, and lifecycle tracking of property.

WHAT DOES THE FEDERAL ACQUISITION REGULATION (FAR) HAVE TO SAY?

Although the FAR does not cite specific examples of waste, fraud, abuse and mismanagement, it is riddled throughout with provisions, conditions, terms and obligations that speak to prevention, mitigation, quality assurance, procedures, standards, and auditing/compliance.

These references are found in Part 2 – Definitions; Part 3 – Improper Business Practices and Personal Conflicts of Interest; Part 9 – Contractor Qualification; Part 28 – Bonds and Insurance; Part 30 – Cost Accounting Standards Administration; Part 39 – Acquisition of Information Technology; Part 45 – Government Property; and Part 46 – Quality Assurance. Now, bear in mind this list is not all-inclusive but serves to draw attention to and demonstrate the mass of relevant content and importance in sustaining our relationship and ethical standing within the Government arena, whether acting in capacity of Government Agency or Contractor.

From this contractor’s perspective, the FAR can be viewed like the old adage, “an ounce of prevention is worth a pound of cure.” As such, we need to understand what exactly is “waste, fraud, abuse and mismanagement” so we can be responsible stewards of the taxpayers’ property. And, subsequently be at the ready to identify, substantiate, document (with evidentiary material) and report accordingly.

Most often people look to do the right thing but sometimes mistakes happen without one’s realization. Following is a list of some examples of waste, fraud, abuse, and mismanagement. vii

WASTE• Property deterioration or degradation

due to lack of care, maintenance, or property storage


• Ordering/acquiring property (equipment and material) in excessive/unreasonable amounts

• Allowing items with shelf life or expirations to cease by using newer stock items first

• Maintaining inventory on items deemed excess or residual to contract operations

• Procuring unnecessary equipment for personal use• Buying overpriced property from a preferred vendor

precluding competitive selection or pricing• Disposing of property without screening for reuse

or reutilization

FRAUD• Purposefully inflating labor hours worked for logistics/

property management on a contract• Counterfeit electronic parts: unauthorized reproduction,

substitution, or alteration that has been knowingly mismarked, misidentified, or otherwise misrepresented to be an authentic, unmodified electronic part from the original manufacturer, or a source with the express written authority of the original manufacturer or current design activity, including an authorized aftermarket manufacturer. Unlawful or unauthorized substitution includes used electronic parts represented as new, or the false identification of grade, serial number, lot number, date code, or performance characteristics.

• Willful failure to perform a contracted obligation or requirement

• Theft and/or pilferage of contract/government property• Purposefully acquiring property with one contract’s fund and

installing of said property on an entirely unrelated contract, without proper or advance authorization

ABUSE• Using a contract/Government asset(s) to download

inappropriate or illegal material• Procuring property against a contract with the intent

of misuse• Poor enforcement of contractor policies and procedures• Failure to separate fiduciary duties between purchasing and

receiving• Not maintaining adequate supporting documentation

and receipts• Equipment charged to a contract that cannot be

found/located• Acquiring equipment or material without first analyzing

existing stock on hand for availability• Using equipment owned by one contract on another or

multiple contracts without authorization• Using contract property for personal use or gain• Abandoning unused material at job/installation sites rather

than return to stock for future use or disposition request• Lack of maintaining reliable inventory records• Not having valid contract requirements prior to acquisition

MISMANAGEMENT• Continuity of a bill/invoice payment for something that no

longer has a requirement or is in existence• Renewing a service or maintenance agreement for property or

a contract no longer in control or existence• Retaining equipment or material without justification or

contractual need (i.e. don’t save for a rainy day just because you want to)

• Not applying adequate controls or access limitations to stock areas to prevent pilferage or misuse

In summary, what I hope to be the general takeaway is that we are all stewards of Government property and as such, we must apply an ethical responsibility in remaining mindful and attuned to potential violations or perceived presence. As property professionals, we become innately aware of such occurrences and most likely see instances whether or not we’re looking for them. Moreover, I think ‘we’ more than most should take on an added sense of duty or obligation to right a supposed wrong when observed, or at least report it to the appropriate party for handling. This article is not meant to be the end all solution but rather enlighten us to an ever-present concern and provide ideas and guidance on how to approach, recognize, and remedy. As property is money, I perceive this as a formula of “Awareness plus Investigation plus Reporting equals Solutions/Mitigations plus Value” [A+I+R=S+V].

REFERENCESi GAO (Government Accountability Office; “Fraud, Waste, Abuse and Mismanagement: Know how to recognize and report them”. https://www.gao.gov/multimedia/fraudnet/infographic/summaryii Ibidiii Black’s Law Dictionary Revised 4th Edition, The Publishers Editorial Staff, West Publishing Co. (1968). iv GAOv Black’s Law Dictionaryvi GAOvii Reporting of Waste, Fraud, Abuse and Mismanagement can be accomplished via GAO site at https://oig.alterline.com

ABOUT THE AUTHOR

Dianna Fisher, CPPM, has been an active NPMA NOVA Chapter member for over 22 years. She is currently the Director of Contracts Asset Management for GDIT. She worked for CSC for the past 25 years until the recent merger with GDIT. Dianna has served NPMA at the Chapter and National level in various positions during her years of service and is currently an ASTM E53 Board Member. This is Dianna’s first article in The Property Professional. Her background is in Accounting, Risk Management, Insurance and Government/Contract Property Management. Dianna is originally from the Washington, DC area but currently lives in the Orlando, Florida area with her husband.

WWW.NPMA.ORG 25

UC POMONACal Poly Pomona is home to the Society of Law, Contracts, and

Property (SLCP). SLCP is a nationally accredited student chapter of both the National Property Management Association (NPMA) and the National Contract Management Association (NCMA). Our roots are in the Department of Law, but we have truly become a diverse group.

Demographically, the students of SLCP are comprised of various majors including Finance, Real Estate and Law, International Business, Technology Operations Management, Computer Information Systems, Engineering, and Accounting. Most of these students also minor in Contract Management (CM). This goes to show that the profession is applicable and relevant in nearly every field. At SLCP, we believe that it’s our diversity in background and interests that make us energetic and adaptable. In 2017, NCMA honored the College of Business Administration’s (CBA’s) Contract Management emphasis with the Contract Management Award.

Our objectives are to EDUCATE, INSPIRE, and EXPLORE. It’s our hope that nurturing a sense of community and support will encourage students to open as many doors as they can and discover a thriving career path. Thanks to our professional and educational partners, as of 2019, we have created relationships with industry professionals including NASA’s Jet Propulsion Laboratory, Raytheon, Boeing, Northrop Grumman, General Atomics, Lockheed Martin, the Defense Contract Management Agency, and the Department of Veteran Affairs. SLCP has collaborated with these companies, in the CBA’s “Professor for a Day” Program, bringing industry knowledge and intelligence to our members.

The Society is under the advisement of Dr. John B. Wyatt III, who created all of the CM courses in the CBA’s Contract Management emphasis. Dr. Wyatt works diligently to provide his students with the knowledge and understanding required to prepare them to enter the CM profession. Students who are graduates of the program study CM bodies of knowledge like: the Federal Acquisition Regulations, Defense Federal Acquisition Regulations Supplement, Uniform Commercial Code, Armed Services Pricing Manual and relevant case material.

NPMA has been a pivotal point in the development of Cal Poly Pomona’s CM Program. It has become increasingly clear that Contract Management and Government Property Management are closely intertwined. It is our hope that, with NPMA’s guidance, we can establish a new course which will cross train students in understanding Contract Management and Government Property. The objective of this course is to educate and prepare Cal Poly Pomona students to successfully obtain NPMA’s Certified Property Professional Specialist (CPPS) certification.

SLCP places significant emphasis on building students’ professional networks. It has recently elected new executive board members who work persistently to support SLCP’s mission to advance students’ academic careers. SLCP looks forward to continued growth and service alongside our new partners and supporters, the National Property Management Association.


VIRTUALLY THEREBRINGING REMOTE TEAM MEMBERS TOGETHER

In our world of web-connected businesses, more and more individuals work from remote locations while still providing the services expected by their employer. This is beneficial because there is: less overhead, access to a larger talent pool, and more flexible work environments reduce employee turnover.

But with those benefits, come challenges that are not typical in normal office spaces. Communication can be difficult, limited interpersonal connections can limit trust, collaboration has to be cultivated, and leadership isn’t as easy.

So, how do we ensure disjointed expert groups become collaborative professional teams? The following is an amalgamation of books, articles, and personal experiences that will help to alleviate “separation anxiety.”

COMMUNICATIONThe greatest challenge in remote work is establishing

a communication style that most effectively replaces the advantageous face to face interaction in normal office settings. There aren’t any collaborative coworkers in the “breakroom.” Instead, a chat room with just your team can be a great way to facilitate casual conversation, or batting ideas back and forth for current and future initiatives. A chat room or instant messaging tool is the closest thing to stopping by a team member’s cube or bumping into them in the hall. An idea can be sent to an individual or team for immediate or later discussion, based on availability, and the recipient(s) can respond without losing their own train of thought.

By Scott W. Petersen, CPPM, Denver Rocky Mountain Chapter

WWW.NPMA.ORG 27

One of the most important things to institute in your communication style, is a communication rhythm and its associated hierarchy. Your rhythm is your meeting consistency. This is where you consider: how often, how long, who is invited, and the meeting’s general purpose. Weekly status, daily tag-up, all-hands, or one-on-one meetings can all be scheduled to help underpin expectations, deadlines, and needed interaction. I have heard it said that the only thing better than a well-planned and perfectly executed meeting, is no meeting at all. We have to have meetings as remote teams, but the benefits to task, team, and time should always be considered before a scheduled meeting is started. Honestly, how often have you let out a sigh of relief when someone had to cancel a meeting?

The hierarchy of your communication should also be determined. Video, phone, instant messaging, email, and voice mail can all be used effectively, so long as they are used as necessary. How important is the information to the team or task? Sending your weekend warrior experience would be more accepted in the team chat room, versus a group email. Just as leaving a list of project milestones should be provided via email instead of voicemail.

Having a style and hierarchy to your communication rhythm is a bit of a balancing act. Two things to consider: first, avoid email and text overload, just pick up the phone or video chat; and second, “reply all” should never be your email default – ever.

CONNECTIONIt should be our purpose to understand someone as they are –

not as we are. When working with people face to face, we should never assume anything about another’s character, motivations, personality, or emotional state. This is even more important when working remotely.

In our virtual interactions, especially video and phone, we need to work hard not only to be personable, but personal in our communications. Professionalism doesn’t require us to be automatons, laser-focused on task deadlines and project execution. Visit your virtual breakroom, and be human while you are there.

If at all possible, get together in person. Meet as a team professionally, but also take advantage of informal venues to better humanize the team. Be very cautious of meeting when the entire team can’t be there. It will drive an invisible, but very real, wedge through the heart of the group.

COLLABORATIONVirtual teams can be as small as two, but shouldn’t be larger

than 10 if you desire to maximize efficiency and effectiveness. The company, Gore-Tex, successfully spins off complete business units, once their personnel count reaches a certain number to reduce diminishing returns.

Each team member should not only know their roles and goals, but clearly understand their individual tasks and responsibilities and how they support the primary objectives of the group.

Keeping current, or better yet real-time, metrics is the heartbeat of any team, and each member should know the health of the system.

A working central repository, whether it be a site, tool, or readily accessible file is an absolute must for collaboration. Open communication keeps the team from duplicating work on identical initiatives, and a functional repository helps to avoid information hoarding – intentional or otherwise.

LEADERSHIPThere are plenty of resources to help leaders improve, so I

wish only to share some things that may be overlooked by virtual leaders.

With virtual teams, leadership should be shared. Each team member takes responsibility and leadership for a specific task or process. There is only one “head chef” in the kitchen but it is still full of cooks, each with their own area of expertise.

Even when you have a great team, with great processes, and admirable metrics, one thing that can be easily forgotten is the validation of great work. Praise team members outwardly, individually and when the team is together. But when it comes to a reprimand, one on one, by video or phone – never in writing unless it is to document your follow through for legal or company reasons.

Last, but not least, be sure to check in with those who don’t speak up (again, one on one). This is an opportunity for discovery. It is common for introverts to not want to draw any attention, but recognizing the silence through query can often give way to innovative ideas. Perhaps the task is not understood, or possibly the individual is in total disagreement with the direction the project is going – and may even have a better process outline to follow. It is the leader’s responsibility to know their team. More questions that are asked and answered, the better comprehension will be for improving your team.

VIRTUALLY POSSIBLEWhether you are part of developing an NPMA chapter, a

decentralized property team, or an association executive with a robust group of subject matter experts, participating in a virtual team doesn’t have to be virtually impossible. It does require thinking beyond yourself, even more than work relationships fostered in cubicle farms.

ABOUT THE AUTHOR

Scott W. Petersen, CPPM, is with Raytheon IIS as a Senior Government Property Compliance Specialist. He has over 16 years of experience in Property Accountability and Integrated Logistics Support. He lives in Ammon, Idaho, and currently serves as the Immediate Past President of the Denver Rocky Mountain Chapter, the Central Region Editor, and the National Director of Membership Media for the NPMA.


“It’s company-owned property, who cares”… “It doesn’t matter if we lose company property, we don’t have to report it to the Government”… “So what if we lose it, we’ll just buy another one…”

How many times have you heard these statements? Have you made them yourself? Well, it’s true, right? The Government doesn’t care about OUR property…FAR doesn’t apply. There’s no risk to the Government. WRONG!!!

The Government doesn’t have a direct interest in our property, but they certainly have an “Indirect” interest. The company’s indirect costs are absorbed into the government contract through the General and Administrative (G&A) rates, reflective of our overhead costs. These are established in accordance with Generally Accepted Accounting Principles (GAAP), as set forth by the Financial Accounting Standards Board (FASB).

There is also the simple matter of our Property Management System. How many of you maintain two (2) separate systems...one for government property and a second one for company property? Do you also maintain two (2) sets of Property Management Procedures? Imagine how costly that would be for the contractor! No, most contractors maintain one Property Control System and one set of Property Control Procedures. The processes are the same...the system is the same... the result should be the same for all property. So, what kind of message are we sending the Government if we aren't managing the company assets? We're also not managing the government assets, putting the government at risk, as well as our company.

Now, let's get down to the bottom line here. Are you a stockholder in your company interested in making a profit? Of course you are! You benefit from that profit

through various profit-sharing programs, annual merit reviews, and investment of your retirement and 401K funds. What happens to that profit when you can't find a piece of critical equipment? Profit dollars are spent to replace that piece of equipment, most likely at a higher price than the original cost. What happens if the company overbuys material because "we might need it for a future contract that we don't have yet?” We build up a stockpile of excess material, costing us both directly and indirectly. Directly, we are paying for property we don't need and indirectly, we pay for storage, inventory control and taxes! That's right…we pay taxes on both the lost item (it's in our property control system, until we write it off ) and on the replacement item, as well as all that material we bought that we don't really need. Speaking of "writing it off," those write-offs impact our overhead rate as an

THE "WHY" OF MANAGING COMPANY-OWNED CAPITAL PROPERTY

By Terri L. Snook, CPPM CF, Los Angeles Chapter

WWW.NPMA.ORG 29

increase. Another increase to the overhead rate to consider is the "depreciation cost" associated with any unlocated capital assets. Our costs go up.... we roll it into our contracts through the G&A rates...we are now less competitive and potentially lose contracts.

As company employees, I believe we should care as much (or more) about our company-owned property as we do about government property. Yes, we all dread those DCMA audits and the resulting corrective actions and possible liability issues, so we place a great deal of emphasis on the management of government property. However, the mismanagement of our company property directly affects the ultimate financial stability of our company. We must also satisfy external CPA audits and local area government directed audits such the Board of Equalization (BOE) tax audit in California as well as DCAA

financial audits. Excessive "write-offs" of property could be questioned and possibly disallowed due to poor property management practices. The government can and will pose the question, “If your Property Management Systems isn’t managing the company-owned property, is it satisfactorily managing the government property?”

We as property professionals have the responsibility and the capability to ensure the success of our companies by placing the same emphasis on the management of company property as we do for government property. Are you willing to step up to plate and work just as hard for your company's interest as you do for the government's interest? It's a personal commitment. Your pay-check depends on it!

Note: This is a re-write of an article published in the Property Professional in 2002 by Terri Snook, CPPM CF.

TERRI L. SNOOK’s, CPPM CF, career in Property Management has spanned over 40 years, during which she has held staff and management positions in several major DoD and Commercial contractors. Her vast experience is a result of “starting at the bottom” as a clerk in the storage/surplus warehouse for Hughes Aircraft Company in the late 70’s and working her way through the 15 property functions at Hughes, Northrop Grumman, Boeing Satellite Systems, HRL Laboratories, and now Aerospace Corporation, as a Property Compliance Staff IV. She has performed critical internal reviews, both with and for DCMA, as well as subcontractor surveillance. Terri currently, in her position at Aerospace Corporation, has the responsibility of implementing and conducting Contractor Self-Assessment, as well as providing mentoring and guidance to fellow employees.


Inventory: The Struggle is Real

Original Cartoon by Amanda Erler

ABOUT THE AUTHOR

Amanda Erler, CPPS, is a Senior Associate with Sunflower Systems and the Secretary of the Federal Center Chapter. She provides asset management expertise, to include support, training, and maintenance activities for Federal government customers.

WWW.NPMA.ORG 31

Global Logistics, Engineering,Science and Space

www.kbrwyle.com 60+ U.S. LOCATIONS AND 40+ FOREIGN SITES

Now hiring Government Property Management positions: n Associate (entry-level) n Analyst (experienced) n Sr. Analyst n Supervisor n Sr. Supervisor n Manager n Sr. Manager Contact [email protected]

KBRwyle_Govt Property Ad.indd 1 6/15/18 11:51 AM

www.astm.org/ COMMITTEE/E53

Committee E53Standard Practices for Asset ManagementJoin industry experts in developing Asset Management Standards!

Of the many challenges the public sector faces, maintaining physical assets is one of the most pressing and complex. With budgets stretched thin and a shortage of maintenance technicians, the difficulties compound. However, technology can help alleviate the burden with tools to optimize the existing asset maintenance workforce and increase productivity.

Agencies need a strategy to stretch the abilities of their existing teams, allowing technicians to work smarter. An advanced enterprise asset management (EAM) solution with built-in analytics and artificial intelligence is a more effective way to help overcome the shortage of skilled technicians.

The shortage of skilled maintenance technicians is not going to disappear overnight. However, with technology helping employees work smarter, existing technicians and new recruits can better manage the workload. These are important steps for building the workforce of the future -- and maintaining an agency's critical assets. Do not let being short-handed get in the way of protecting the assets on which constituents depend.

The full article can be found at https://gcn.com/articles/2019/03/26/asset-maintenance-talent.aspx

INDUSTRY INSIGHTHOW TECH HELPS STRETCH ASSET MAINTENANCE TALENT

BY KEVIN PRICE


DEAR EXPERT PANEL:I have Government Property (GP)

accountable under a Cost Reimbursement type contract. We clearly use that GP for that instant contract. But we have other contracts – both Government and commercial – that we would like to use this GP on for the work under those contracts. Someone told us that we could do this. Is that correct?

SIGNED — URGENT TO UTILIZE

DEAR URGENT:The answer is a qualified “MAYBE!”First off, you ARE authorized to use that

Government Property under the contract to which it is accountable. As well as subcontracts for the performance of the PRIME contract.

The Government Property clause at FAR 52.245-1 provides the contractual limitation/requirement under paragraph (c) that, “(1) The Contractor shall use Government property, either furnished or acquired under this contract, only for performing this contract, unless otherwise provided for in this contract or approved by the Contracting Officer.”

Therefore, you can use it on the instant contract or AS APPROVED by the Contracting Officer.

Any OTHER use on OTHER WORK… well, you need to seek permission of the Contracting Officer (and potentially Contracting Officers (plural)). FAR 45.301 provides the regulatory underpinnings for use. Paragraph (a) repeats what was stated above, i.e., it can be used on the accountable contract – the contract under which it was provided. Paragraphs (b) and (c) provide discussion of Rental charges in very specific situations (and since you did not specify these in your query – I will not discuss them).

Now, the gist of your question revolves around other Government or commercial contracts - -and paragraphs (d), (e), and (f ) answer those questions:

(d) – if this is a Fixed Price (FP) Government Contract requesting the use – then the Contracting Officer MAY authorize the use of Government Property after obtaining a “fair rental or other adequate consideration.”

(e) – If this is a Cost Reimbursement (CR) Government Contract requesting the use – the Contracting Officer MAY authorize the use of the Government Property on a rent-free basis. Why the difference between FP and CR? Because under a CR type contract if the Government charged rent – that rent may be chargeable BACK to the charged contract.

(f ) – deals with the possibility of using GP on COMMERCIAL WORK. And yes, the Contracting Officer MAY authorize this use, IF the Contracting Officer obtains consideration for this use. But also note – there is a limitation to the amount of use, percentage wise, allowed for this commercial use. Up to 25% -- the Contracting Officer may authorize. More than 25% -- it moves up to the Head of the Contracting Activity.

With all three of these items note that the Contracting Officer MAY authorize the use discussed – in two instances with consideration, and in one instance without rent or consideration. But it is wise to note that the Contracting Officer is not compelled to grant this authorization. It is an option available to the Government.

Lastly, to close the loop regarding consideration or rent – FAR 52.245-9 provides the contractual discussion of rent and requests to use Government property including various methods to determine

the quantification of rent for the use of Government property when applicable.

RESPECTFULLY SUBMITTED, YOUR EXPERT PANEL

LEGAL DISCLAIMER:This email and the advice contained within is for recommendation purposes only. NPMA makes no representations or warranties of any kind, express or implied, including without limitation any implied warranty of fitness for a particular purpose. Please note that additional issues may exist that could affect the treatment of the recommendation. The recommendation does not consider or reach a conclusion with respect to additional issues. This is not to be construed as legal advice and NPMA is not liable for any damages, etc. that result from following (or not following) their advice. In no event shall NPMA be liable for any lost profits, lost data, or any form of special, incidental, indirect, consequential or punitive damages of any kind (whether or not foreseeable), whether based on breach of contract, tort (including negligence), product liability or otherwise, even if it is informed in advance of the possibility of such damages.

Questions

DO YOU HAVE A BURNING QUESTION for our panel

of experts? We want to hear from you. Email [email protected] to submit

your question.

ASKUS

BY YOUR NPMA ‘EXPERT’ PANEL

ASK THEEXPERT

WWW.NPMA.ORG 33WASHINGTON, DC

NPMA NATIONAL EDUCATION SEMINAR

August 19-22, 2019 | Marriott MarquisRegister Now! | npmaconferences.org/nes

Join us in our nation’s capital for four days of in-depth education and knowledge exchange from leading personal property and fixed-asset professionals.

The year’s education tracks include:• Best Practices – Fundamentals & Intermediate/

Advanced• Federal Property – Fundamentals &

Intermediate/Advanced• Fleet• Government/Contract Property – Fundamentals,

Intermediate & Advanced• Professional Development• Standards• State & Local Government• University

Plus: Earn up to 17.5 CEUs

Select from 6 Pre-NES Education & Certification Courses (additional fee)

Keynote by Kevin Brown, Author of The Hero Effect

Productive Networking Events

Exhibitors Ready to Help You Find Solutions

NPMA Guest Room Rates: $179 single/double occupancy plus tax per night

With over 100 sessions packed with updates, best practices, big-picture keynotes and plenty of networking, NES is MONUMENTAL this year!

MAXIMIZE YOUR SAVINGS! REGISTER BY JUNE 1 TO CLAIM YOUR MEMBER DISCOUNT AND EARLY-BIRD RATE.


100 WORST MISTAKES IN PROPERTY MANAGEMENT

JULY 16-18 // WASHINGTON, DCDuring this informative three-day course, you will learn what

common mistakes are made, the possible consequences of repeating them, and tips for avoiding these blunders all together. Every phase of the property life cycle will be examined, including best practices and guiding principles.

This course is a great refresher for seasoned professionals who can draw on the mistakes of others. For new professionals, the course will provide the framework and examples to ensure common mistakes can be avoided.

FLEET MANAGEMENT – CERTIFIED FEDERAL FLEET SPECIALIST

JULY 23-25 // NAPLES, ITALY AUGUST 16-18 // WASHINGTON, DC

The NPMA, in partnership with Mercury Associates, is proud to offer the first Certification for the Federal Fleet Manager. The Certified Federal Fleet Specialist (CFFS) level training is designed for persons who have basic Fleet Management responsibilities or dual roles such as the vehicle control officer. Course subjects include Basic Fleet Management, Fleet Information Management: Regulations, Systems and Data, and Optimizing the Fleet. Certification testing will be performed during the 3-day course.

GOVERNMENT PROPERTY BASICS

AUGUST 14-18 // WASHINGTON, DC When it comes to managing assets, understanding the complexities

of government regulations is a vital first step. This five-day course presents a detailed analysis of life cycle asset management in government property systems. In addition to the fundamentals of property management and the regulatory requirements of property management, this course includes an overview of the Federal Acquisition Regulations (FAR) and other appropriate regulations used in federal government procurement of supplies and services. The course is essential if you work in property management, supply-chain, logistics, quality assurance, contract management, procurement, subcontract administration, program management or internal auditing.

COURSE Schedule

Register today for an NPMA

course!

BY ATTENDING AN NPMA course, you’ll gain the knowledge and skills you need to succeed on the job. Don’t wait, register today! Seating is limited!

IF YOU HAVE QUESTIONS about NPMA courses, call 404.477.5811 or email [email protected]. For more information or to register, visit the website at www.npma.org and click on the Education tab.

DON’T WAIT

WWW.NPMA.ORG 35

FEDERAL GOVERNMENT PROPERTY MANAGEMENT

AUGUST 14-16 // WASHINGTON, DCFederal Government Property Management is a 2 1/2 day-

course that will prepare federal government property personnel for management level thinking. The class will engage students in the life cycle phases of property management from requirements gathering to final record closeout, with discussions of roles and responsibilities, process relationships, value and risk management responsibilities, performance measures and impacts on sound property management. The class structure will be to review requirements and to discuss an application process of how an organization implements the requirements into their own organization and governance structure.

FLEET MANAGEMENT – CERTIFIED FEDERAL FLEET ADMINISTRATOR

AUGUST 17-19 // DENVER, COThe NPMA, in partnership with Mercury Associates, is proud

to offer the first Certification for the Federal Fleet Manager. The Certified Federal Fleet Administrator (CFFA) level training is designed for persons who have successfully completed the Certified Fleet Specialist training.

Course subjects include: Fuel Management, Leased Fleet Management, Asset Management, and Disposal Management. Certification testing will be performed during the 3-day course.

NPMA CERTIFICATION REVIEWS & TESTINGThe NPMA Certification Program is designed to elevate

professional standards and enhance individual performance for those who demonstrate a high level of competence that is essential to the practice of property management. If you have made a commitment to a career in property management, you should consider obtaining your NPMA certification. Join a distinguished group of peers worldwide who have chosen to attain this high level of excellence.

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CPPS CERTIFICATION REVIEW & TESTING / FUNDAMENTALS OF PERSONAL PROPERTY MANAGEMENT

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Documents

PROPERTY... ISSN-1072-2858 06.2019 PROPERTY VOL 31 ISSUE 3 PROFESSIONAL THE ALSO IN THIS ISSUE MMAS: What is it and Can You Utilize One? How My Life-long Love of Dance Helped Prepare