"How to" Select & Implement Property Standards

1. "How to" Select & Implement Property Standards NPMA NES 2010 Lyle Hestermann, CPPM CF MIAM Director, Standards Development and Utilization

2. Selecting VCSs is easy!

3. Concepts For This Session Are: What VCSs are there? Integrating Standards Into Your Procedures. Standards And Self Assessment Using The Equipment Control Matrix Taking Full Advantage Of The LDD Standard Using the LRP Standard (previously the Admin Control Std) Connecting The Dots – Using The Standards together

4. Published Standards E2131 Standard Practice for Assessing Loss, Damage, or Destruction of Property E2132 Standard Practice for Physical Inventory of Durable, Moveable Property E2135 Standard Terminology for Property and Asset Management E2279 Standard Practice for Establishing the Guiding Principles of Property Management E2306 Standard Practice for Utilization and Disposal of Personal Property E2378 Standard Practice for the Recognition of Impaired or Retired Personal Property E2379 Standard Practice for Property Management for Career Development and Training E2452 Standard Practice for Equipment Management Process Maturity (EMPM) Model E2453 Standard Practice for Determining the Life-Cycle Cost of Ownership of Personal Property

5. Published Standards E2495 Standard Practice for Prioritizing Asset Resources in Acquisition, Utilization, and Disposition E2497 Standard Practice for Calculation of Equipment Movement Velocity (EMV) E2499 Standard Practice for Classification of Equipment Physical Location Information E2604 Standard Practice for Data Characteristics of Equipment Records E2605 Standard Practice for Receiving Property E2606 Standard Practice for Receipt Notification as a Result of Tangible Property Movement E2607 Standard Practice for Cannibalization/Reclamation of Serviceable Equipment Components to Support Demand Requirements E2608 Standard Practice for Equipment Control Matrix (ECM)

6. Published Standards E2631 Standard Practice for Physical Placement of an Entity-Controlled Supplemental Identification Label E2671 Standard Practice for Defining Movements, Shipments, and Transfers of Tangible Property E2672 Standard Practice for Identification and Categorization of Tooling E2674 Standard Practice for Assessment of Impact of Mobile Data Storage Device (MDSD) Loss E2675 Standard Practice for Property Management System Outcomes E2676 Standard Practice for Tangible Property Mobility Index (MI) E2715 Standard Practice for Moveable Property Storage E2811 Standard Practice for Management of Low Risk Property (LRP) E2812 Standard Practice for Uniform Data Management in Asset Management Records Systems

7. Draft Standards WK27486 New Practice for Property Management Database Asset Catalogs (Technical Contact: Brandon Kriner) Ballot E53 (11-02) Item 002; WK29521 New Classification for Property Types (Technical Contact: Eric Fassett) WK32431 New Practice for for Sales of Personal Property (Technical Contact: Robert Holcombe)

9. Integrating standards into your procedures. • Entity/Corporate/Company/Site/Whatever – start with the basics • Guiding Principles, E2279 • Terminology, E2135 (Property Management and Compliance)

10. Integrating standards into your procedures. • Entity/Corporate/Company – the basics • E 2132, Standard Practice for Physical Inventory of Durable Moveable Property (Physical Inventories)

11. Integrating standards into your procedures. • Entity/Corporate/Company – the basics • E 2132, Standard Practice for Addressing and Reporting Loss, Damage or Destruction of Tangible Property (Property; Control of Loss, Damage or Destruction (LDD))

12. Integrating standards into your procedures. • Entity/Corporate/Company – the basics • E2605, Standard Practice for Receiving Property (????)

14. Standards and Self Assessment

15. Standards and Self Assessment E 2452 – 05e1 Standard Practice for Equipment Management Process Maturity (EMPM) Model

16. Standards and Self Assessment The standard recognizes five maturity levels:

17. Standards and Self Assessment Can Property Do Their Job In A Vacuum?

18. Standards and Self Assessment

19. Standards and Self Assessment

21. Using The Equipment Control Matrix 1. Scope 1.1 This practice describes equipment control classes (ECCs), equipment control levels (ECLs), and their relationships. 1.2 This practice is intended to be applicable and appropriate for all equipment-holding entities. 1.3 This practice covers property categorized as equipment. Equipment as defined in Terminology E 2135 is nonexpendable, tangible moveable property needed for the performance of a task or useful in effecting an obligation. 1.4 This practice can be applied to an individual item of equipment, to groupings of equipment, or to all or a subset of an entity’s equipment. 1.5 In accordance with the provisions of Practice E 2279, this practice clarifies and enables effective and efficient control and tracking of equipment.

22. Using The Equipment Control Matrix 5.1.1 The ECCs are based on the consequences of the loss of control of the equipment. There are five classifications, or groupings, which define the ECCs.

23. Using The Equipment Control Matrix 5.1.1.1 Equipment Control Class 1—Consequence of loss of control is a societal safety/security impact, which is characterized by negative societal safety or security impact. 5.1.1.2 Equipment Control Class 2—Consequence of loss of control is a personal safety/security impact, which is characterized by negative personal safety or security impact that does not rise to the level of a societal safety or security impact. 5.1.1.3 Equipment Control Class 3—Consequence of loss of control is an operational impact, which is characterized by negative operational impact that does not rise to the level of a personal or societal safety or security impact.

24. Using The Equipment Control Matrix 5.1.1.4 Equipment Control Class 4—Consequence of loss of control is a compliance impact, which is characterized by negative compliance with applicable laws regulations or other relevant internal or external guidance that does not rise to the level of an operational impact. 5.1.1.5 Equipment Control Class 5—Consequence of loss of control is not discernible, which is characterized by having no visible or recognizable impact on the organization.

25. Using The Equipment Control Matrix 5.2 Equipment Control Levels (ECLs): 5.2.1 The five levels of control of equipment are based on differentiated tracking specifications. 5.2.1.1 Equipment Control Level A.—Continuous, which provides real time tracking and control with either human or electronic monitoring and surveillance at all times. 5.2.1.2 Equipment Control Level B.—Continuous while mobile, which provides real time tracking and control with either human or electronic monitoring and surveillance at any time the equipment is not stationary in a secure, fixed location.

26. Using The Equipment Control Matrix 5.2.1.3 Equipment Control Level C.—Event tracking, which provides the level of control characterized by manual or electronic recording of movement, accountability, or stewardship changes. 5.2.1.4 Equipment Control Level D.—Containment, which provides the level of control characterized by process or electronic methods of assuring equipment items are contained within a designated area. 5.2.1.5 Equipment Control Level E.—No tracking and no protection are required at this level.

27. Using The Equipment Control Matrix

28. Using The Equipment Control Matrix

29. Using The Equipment Control Matrix

30. Using The Equipment Control Matrix

31. Using The Equipment Control Matrix

32. Using The Equipment Control Matrix

34. Taking Full Advantage Of The LDD Standard

35. Taking Full Advantage Of The LDD Standard • Acceptable loss ratios, per E2131: • ECC1 is 0 %. • ECC2 is 0.5 % (dollar value or quantity). • ECC3 is 1 % (dollar value or quantity). • ECC4 is entity establish IAW law, regulation or contractual guidance, otherwise 3%

36. Taking Full Advantage Of The LDD Standard - In Your LDD Report 14. Loss ratio in relation to program: Currently, this program has over 4,000 line items of equipment accountable at an acquisition cost of $15.9 million. The loss of this item and the items represented on three other loss letters represent a less than 0.5% loss ratio as determined by line items, and a less than 0.3% loss ratio as determined by acquisition value, well within DoD guidelines and ASTM E53 2131-09, Standard Practice for Addressing and Reporting Loss, Damage or Destruction of Property.

37. Taking Full Advantage Of The LDD Standard Perspective!

39. E2811-11 Standard Practice for Management of Low Risk Property (LRP)

40. Using The LRP Standard 1. Scope 1.1 This practice covers the assessment of risk and management of low risk property (LRP). 1.2 This practice is directed at tangible LRP. 1.3 This practice does not promote mismanagement or dereliction of duty to protect property, nor protecting property unreasonably – to the extent that usefulness is impaired. This practice recognizes the constraints of materiality and costs versus benefits in the control and management of property.

41. Using The LRP Standard 3.1.2 life cycle processes (LCP)—the various management and control stages of property from its acquisition through disposition; these processes include but are not limited to acquisition, receiving, identification, records, movement, maintenance, storage, physical inventory, loss, damage, and destruction reporting and disposition.

42. Using The LRP Standard 3.1.3 low risk property (LRP)—assets that are monitored and controlled at the discretion of asset managers and typically consist of low risk expendables or durable equipment and tooling based on established and disclosed criteria. (Refer to 4.2 for more information.)

43. Using The LRP Standard 4.1 LRP should be administratively controlled and managed to a lesser degree or with a more efficient technique than higher risk property.

44. 4.2 The type and scope of control and management should be commensurate with the level of risk. The entity shall determine the level of risk using the following criteria: 4.2.1 Scarcity, 4.2.2 Technological obsolescence, 4.2.3 Lead time, 4.2.4 Standardization, 4.2.5 Criticality, 4.2.6 Sensitivity, 4.2.7 Dollar value, 4.2.8 Environmentally regulated, 4.2.9 National security/threat, 4.2.10 Schedule constraints, 4.2.11 Vulnerability, 4.2.12 Societal or personal safety, and 4.2.13 Contractual agreements. NOTE 1—The listing in 4.2.1-4.2.13 is not all inclusive and may be supplemented by the entity.

45. Using The LRP Standard • Do you control highly sensitive/hazardous/dangerous products the same way you do your office supplies? • Do you have procedures, based on VCSs or other widely accepted data, that allows you to determine which life cycle processes you use for low risk property?

46. Using The LRP Standard • Risk avoidance is more costly than risk management. • It may be - will be - more efficient to apply common sense and use less control for LRP.

48. Connecting The Dots – Using The Standards Together How many Property Professionals does it take to manage how much stuff?

49. The Old Way

50. Better *ASTM E2497-06