Not-For-Profit Company – Income Recovery

Following completion of a Government-owned Company’s (GovCo) first Fiscal Year, it was identified that the core fee for maintenance services within the prison estate was insufficient due to high volumes of vandalism across sites which significantly increased the reactive workload. It was agreed that reactive maintenance tasks that resulted from vandalism or misuse would require additional funding, however there was no process in place to capture, quantify and bill this work.

An opportunity was identified to utilise the CAFM system to capture labour costs and material costs, however to embed this process and the associated cost management skill into the culture and daily practices across 49 prison establishments in a short timeframe proved challenging; therefore it was agreed that an interim process would be implemented.

We developed a detailed methodology which required engagement from departments such as Supply Chain and HR to enable data from the CAFM system to be converted into a recoverable cost. The methodology included separating work which was completed by non-chargeable labour such as funded teams or prisoner resource engaged in rehabilitation activities.

Once the calculations for the vandalism works were complete, the information was submitted to the client for approval and further analysis was carried out on the volume and justification for rejected transactions. An acceptance rate methodology was developed as part of this process and applied to all vandalism jobs identified (back-dated), to expedite income recovery and save unnecessary management time.

As the process was new to the organisation, CI Projects worked with a variety of key stakeholders from all parties in order to develop a process which successfully met the needs of both organisations.

The benefits include;

• Implementation of an end to end process which would enable the not-for profit GovCo to recover appropriate funding to support the delivery of services
• Identification of £1.6million worth of recoverable vandalism and misuse income in a 6 month period
• Development of an assurance process which involved re-validation of the average rates so costs would be more accurate
• Ongoing data analysis and insight which was shared with the operational teams to identify failure trends and drive continuous improvement
• Supported the upskilling of operational teams by developing toolbox talks, issuing communication, sharing performance reports and engaging with Leadership to sponsor the change.

Stephanie Hill, Finance Director says: “The work Olivia completed on the vandalism process enabled us to recover costs outside of the core service scope which was a key contributor to budget management in the financial year. The work also provided insightful data to enable us to make data-driven decisions and was an enabler towards a longer-term cost recovery solution with regards to vandalism work.”