Risk ManagementRisk ManagementUser GroupUser Group

Wednesday, May 18, 2004Wednesday, May 18, 2004

WelcomeWelcome

Michael L. Hay, CGFM, CPPMMichael L. Hay, CGFM, CPPM

Meeting AgendaMeeting Agenda 8:30-8:458:30-8:45 – Welcome– Welcome 8:45-9:058:45-9:05 – Workers’ Compensation – Workers’ Compensation

Reform Ideas in the Reform Ideas in the Legislature Legislature

9:05-9:25 9:05-9:25 – Update, Business – Update, Business Continuity Continuity

9:25-10:259:25-10:25 – Return to Work– Return to Work 10:25-10:40 10:25-10:40 – Break – Break

Meeting AgendaMeeting Agenda 10:40-11:10 – 10:40-11:10 – Lost, Damaged, & Lost, Damaged, &

Destroyed Property Address Destroyed Property Address 11:10-11:30 –11:10-11:30 – Address by the New Address by the New

Executive Executive Director of SORM Director of SORM 11:30-11:50 – 11:30-11:50 – Accident Investigation Accident Investigation 11:50-12:05 – 11:50-12:05 – Workers’ Comp. Cost Workers’ Comp. Cost

Allocation ProgramAllocation Program 12:05-12:20 – 12:05-12:20 – FY03 Safety AwardsFY03 Safety Awards

Workers’ Compensation Workers’ Compensation Reform Ideas in the Reform Ideas in the

LegislatureLegislature

Steven PierSteven Pier

SORM Legislative LiaisonSORM Legislative Liaison

Questions & Comments?Questions & Comments?

Where is Business Where is Business Continuity in State Continuity in State Government TodayGovernment Today

Roger Thormahlen, CICRoger Thormahlen, CIC

State Office of Risk State Office of Risk ManagementManagement

john.thormahlen@sorm.state.tx.usjohn.thormahlen@sorm.state.tx.us

512-936-2944512-936-2944

The PastThe Past

Began with the Texas Disaster Act Began with the Texas Disaster Act of 1975of 1975

Created the Emergency Created the Emergency Management Council and Division Management Council and Division of Emergency Managementof Emergency Management

Required a state disaster plan be Required a state disaster plan be prepared prepared

In 1978In 1978

The Interagency Disaster Recovery The Interagency Disaster Recovery Planning Group was established Planning Group was established

To provide state agencies the tools To provide state agencies the tools needed to develop their disaster needed to develop their disaster plansplans

In 1989In 1989

HB2736 established the Texas HB2736 established the Texas Department of Information Resources Department of Information Resources (DIR) and gave them the responsibility (DIR) and gave them the responsibility of the State Disaster Recovery of the State Disaster Recovery PlanningPlanning

Focused on the information technology Focused on the information technology function of an agency and upcoming function of an agency and upcoming Y2K technical conversion issuesY2K technical conversion issues

In 2001In 2001

SORM assumed the point of the SORM assumed the point of the campaign for state agency business campaign for state agency business continuity planning continuity planning

SORM turned to its risk SORM turned to its risk management specialists to ask each management specialists to ask each agency during risk management agency during risk management consultations about the agency’s consultations about the agency’s business continuity plansbusiness continuity plans

Business Continuity Business Continuity PlanningPlanningInvolvesInvolves

The advanced planning and arrangements The advanced planning and arrangements which are necessary to ensure continuity which are necessary to ensure continuity of the critical functions of an organizationof the critical functions of an organization

Making sufficient agreed-upon Making sufficient agreed-upon preparations and designing and preparations and designing and implementing sufficient agreed-upon implementing sufficient agreed-upon procedures for responding to a disaster procedures for responding to a disaster eventevent

Expectations    Expectations    

1.1. Does the agency have a BC plan or COOP Does the agency have a BC plan or COOP plan encompassing plan encompassing allall of the agency critical of the agency critical functions?functions?

2.2. Does the agency have a “policy statement” Does the agency have a “policy statement” or “directive” from senior management or “directive” from senior management establishing the value and its commitment establishing the value and its commitment to business continuity management (BCM)?to business continuity management (BCM)?

3.3. Has a “Business Impact Analysis” (BIA) been Has a “Business Impact Analysis” (BIA) been conducted to identify critical business conducted to identify critical business functions of the agency? functions of the agency?

Expectations (cont’d)Expectations (cont’d)

4.4. Have “Recovery Time Objectives” (RTOs) Have “Recovery Time Objectives” (RTOs) been established for the critical functions?been established for the critical functions?

5.5. Have Recovery Point Objectives (RPO) Have Recovery Point Objectives (RPO) been determined?been determined?

6.6. Has the agency given an order or priority Has the agency given an order or priority to restoring the critical functions, to restoring the critical functions, personnel and personal property needs of personnel and personal property needs of the agency in the event of a disaster?the agency in the event of a disaster?

Expectations (cont’d)Expectations (cont’d)

7.7. Does the agency have a consolidated Does the agency have a consolidated “Continuity and Recovery Strategy” across the “Continuity and Recovery Strategy” across the enterprise? enterprise?

8.8. What method best describes the agency What method best describes the agency strategy?strategy?

9.9. Do the strategies include a diagram and Do the strategies include a diagram and inventory description of current inventory description of current communication and data systems? communication and data systems?

10.10. Does the agency have “Emergency Response” Does the agency have “Emergency Response” procedures to respond to disastrous events? procedures to respond to disastrous events?

Expectations (cont’d)Expectations (cont’d)

11.11. Does each mission-critical business function Does each mission-critical business function within the agency have a recovery plan in within the agency have a recovery plan in place? place?

12.12. Has the agency identified critical support Has the agency identified critical support vendors and incorporated them into the call vendors and incorporated them into the call tree?tree?

13.13. Does the agency have enterprise “Business Does the agency have enterprise “Business Continuity Awareness and Training?” Continuity Awareness and Training?”

14.14. Has the Business Continuity Plan been tested?Has the Business Continuity Plan been tested?

Expectations (cont’d)Expectations (cont’d)

15.15. How and when was the plan tested? How and when was the plan tested? 16.16. Does the agency have “Change Maintenance Does the agency have “Change Maintenance

Process” for the plan? Process” for the plan? 17.17. Does the agency have a designated person to Does the agency have a designated person to

speak to the media? speak to the media? 18.18. Does the agency have a call list to Does the agency have a call list to

communicate with employees and critical communicate with employees and critical vendors? vendors?

19.19. Does this call list include alternate phone Does this call list include alternate phone numbers, e-mail addresses?numbers, e-mail addresses?

BCP Discipline GoalsBCP Discipline Goals

SORM’s primary goal is for the state’s BCP SORM’s primary goal is for the state’s BCP planning efforts to parallel accepted planning efforts to parallel accepted industry standards established by Disaster industry standards established by Disaster Recovery Institute International (DRII)Recovery Institute International (DRII)

http://www.drii.orghttp://www.drii.org And the federal government’s Continuity And the federal government’s Continuity

of Operations Planning (COOP) model of Operations Planning (COOP) model COOP guidance can be found at FPC66 COOP guidance can be found at FPC66

http://www.fema.gov/regions/x/npd/coop.shttp://www.fema.gov/regions/x/npd/coop.shtmhtm under Resourcesunder Resources

Tools Available Tools Available Through SORMThrough SORM

SORM’s BCP website SORM’s BCP website http://www.sorm.state.tx.us/bcp/init_overview.http://www.sorm.state.tx.us/bcp/init_overview.html html

Tools (cont’d)Tools (cont’d)

Generic forms to improve efficiency and Generic forms to improve efficiency and effectiveness in the planning processeffectiveness in the planning process

A network of knowledgeable persons from A network of knowledgeable persons from various state agencies who are willing to various state agencies who are willing to help in business continuity managementhelp in business continuity management

A SORM business continuity contact A SORM business continuity contact person to consult about planning and person to consult about planning and testingtesting

Questions & Comments?Questions & Comments?

RETURN TO WORKRETURN TO WORK

Pat CrawfordPat Crawford

Texas Workers’ Compensation Texas Workers’ Compensation CommissionCommission

STAY AT WORKSTAY AT WORKRETURN TO WORKRETURN TO WORK

WHAT’S BEST FOR WHAT’S BEST FOR

YOUR BUSINESSYOUR BUSINESS

&&

YOUR EMPLOYEESYOUR EMPLOYEES

REDUCEREDUCE WC COSTS!WC COSTS!

CONTROL CONTROL LOST TIME! LOST TIME!

ELIMINATE ELIMINATE OPPORTUNITIES OPPORTUNITIES

FOR FRAUD AND MALINGERING!FOR FRAUD AND MALINGERING!

REDUCEREDUCE WC COSTS!WC COSTS!

CONTROL CONTROL LOST TIME! LOST TIME!

ELIMINATE ELIMINATE OPPORTUNITIES OPPORTUNITIES

FOR FRAUD AND MALINGERING!FOR FRAUD AND MALINGERING!

HIGHEST WORKERS’ HIGHEST WORKERS’ COMPENSATION COMPENSATION

MEDICAL COST IN MEDICAL COST IN NATIONNATION

HIGHEST WORKERS’ HIGHEST WORKERS’ COMPENSATION COMPENSATION

MEDICAL COST IN MEDICAL COST IN NATIONNATION

DOI-2000DOI-2000

MORE THAN 7 DAYS MORE THAN 7 DAYS LOST TIMELOST TIME

$10,700$10,700

DOI-2000DOI-2000

MORE THAN 7 DAYS MORE THAN 7 DAYS LOST TIMELOST TIME

$10,700$10,700

TEMPORARY INCOMETEMPORARY INCOME

BENEFITS DOI 2000BENEFITS DOI 2000

31 WEEKS @ $30531 WEEKS @ $305

$9455$9455

TEMPORARY INCOMETEMPORARY INCOME

BENEFITS DOI 2000BENEFITS DOI 2000

31 WEEKS @ $30531 WEEKS @ $305

$9455$9455

$20,000 + $20,000 +

AVERAGE COST AVERAGE COST DOI 2000DOI 2000

PAY AN ADDITIONAL: $4000PAY AN ADDITIONAL: $4000

FORFORWORK HARDENINGWORK HARDENING

WORK CONDITIONINGWORK CONDITIONINGPROGRAMPROGRAM

PAY AN ADDITIONAL: $4000PAY AN ADDITIONAL: $4000

FORFORWORK HARDENINGWORK HARDENING

WORK CONDITIONINGWORK CONDITIONINGPROGRAMPROGRAM

REPLACEMENT COSTSREPLACEMENT COSTS OVERTIME / WAGESOVERTIME / WAGES NEW & INEXPERIENCED NEW & INEXPERIENCED

EMPLOYEEEMPLOYEE BUSINESS LOSS?BUSINESS LOSS?

REPLACEMENT COSTSREPLACEMENT COSTS OVERTIME / WAGESOVERTIME / WAGES NEW & INEXPERIENCED NEW & INEXPERIENCED

EMPLOYEEEMPLOYEE BUSINESS LOSS?BUSINESS LOSS?

HEAL FASTER AND BETTERHEAL FASTER AND BETTER RETAIN JOB SKILLSRETAIN JOB SKILLS RETAIN BENEFITS/SENIORITYRETAIN BENEFITS/SENIORITY RETAIN LONG TERM RETAIN LONG TERM

PRODUCTIVE EMPLOYMENTPRODUCTIVE EMPLOYMENT ECONOMIC STABILITYECONOMIC STABILITY

HEAL FASTER AND BETTERHEAL FASTER AND BETTER RETAIN JOB SKILLSRETAIN JOB SKILLS RETAIN BENEFITS/SENIORITYRETAIN BENEFITS/SENIORITY RETAIN LONG TERM RETAIN LONG TERM

PRODUCTIVE EMPLOYMENTPRODUCTIVE EMPLOYMENT ECONOMIC STABILITYECONOMIC STABILITY

MORE SECONDARY MORE SECONDARY COMPLICATIONSCOMPLICATIONS

MORE TREATMENTMORE TREATMENT POOR ATTITUDE TOWARD POOR ATTITUDE TOWARD

EMPLOYEREMPLOYER FINANCIAL BURDENSFINANCIAL BURDENS

MORE SECONDARY MORE SECONDARY COMPLICATIONSCOMPLICATIONS

MORE TREATMENTMORE TREATMENT POOR ATTITUDE TOWARD POOR ATTITUDE TOWARD

EMPLOYEREMPLOYER FINANCIAL BURDENSFINANCIAL BURDENS

6 MONTHS OFF = 25%6 MONTHS OFF = 25%

CHANCE OF CHANCE OF EVEREVER RETURNING TO PRODUCTIVE WORK RETURNING TO PRODUCTIVE WORK

6 MONTHS OFF = 25%6 MONTHS OFF = 25%

CHANCE OF CHANCE OF EVEREVER RETURNING TO PRODUCTIVE WORK RETURNING TO PRODUCTIVE WORK

EMPLOYERSEMPLOYERSRESPOND TO INQUIRIES RESPOND TO INQUIRIES

ABOUT RETURN TO WORK ABOUT RETURN TO WORK OPPORTUNITIESOPPORTUNITIES

CARRIERSCARRIERSPROVIDE RETURN TO WORK PROVIDE RETURN TO WORK

COORDINATIONCOORDINATION

EMPLOYERSEMPLOYERSRESPOND TO INQUIRIES RESPOND TO INQUIRIES

ABOUT RETURN TO WORK ABOUT RETURN TO WORK OPPORTUNITIESOPPORTUNITIES

CARRIERSCARRIERSPROVIDE RETURN TO WORK PROVIDE RETURN TO WORK

COORDINATIONCOORDINATION

JOB (TASK) JOB (TASK) ANALYSIS/ASSESSMENTSANALYSIS/ASSESSMENTS

MEDICAL OR VOCATIONAL MEDICAL OR VOCATIONAL CASE MANAGEMENTCASE MANAGEMENT

RECOMMEND ERGONOMIC RECOMMEND ERGONOMIC ADJUSTMENTSADJUSTMENTS

??

JOB (TASK) JOB (TASK) ANALYSIS/ASSESSMENTSANALYSIS/ASSESSMENTS

MEDICAL OR VOCATIONAL MEDICAL OR VOCATIONAL CASE MANAGEMENTCASE MANAGEMENT

RECOMMEND ERGONOMIC RECOMMEND ERGONOMIC ADJUSTMENTSADJUSTMENTS

??

ELIMINATEELIMINATE

UNNECESSARYUNNECESSARY

LOST TIMELOST TIME

POSTUREPOSTURELIFTING-CARRYINGLIFTING-CARRYINGACTIONS-MOTIONSACTIONS-MOTIONSEQUIPMENT-TOOLSEQUIPMENT-TOOLS

ENVIRONMENTENVIRONMENT

-HOURS-POUNDS-PUSHING-PULLING--HOURS-POUNDS-PUSHING-PULLING--REPETITIONS-CHEMICALS--REPETITIONS-CHEMICALS-

-TEMPERATURE-NOISE-WET-DRY--TEMPERATURE-NOISE-WET-DRY-

POSTUREPOSTURELIFTING-CARRYINGLIFTING-CARRYINGACTIONS-MOTIONSACTIONS-MOTIONSEQUIPMENT-TOOLSEQUIPMENT-TOOLS

ENVIRONMENTENVIRONMENT

-HOURS-POUNDS-PUSHING-PULLING--HOURS-POUNDS-PUSHING-PULLING--REPETITIONS-CHEMICALS--REPETITIONS-CHEMICALS-

-TEMPERATURE-NOISE-WET-DRY--TEMPERATURE-NOISE-WET-DRY-

CONSISTENCYCONSISTENCY BEST EFFORT EVERY TIMEBEST EFFORT EVERY TIME WRITTEN POLICYWRITTEN POLICY ACCOUNTABILITYACCOUNTABILITY ASSIGN RESPONSIBILITYASSIGN RESPONSIBILITY ESTABLISH EXPECTATIONESTABLISH EXPECTATION

CONSISTENCYCONSISTENCY BEST EFFORT EVERY TIMEBEST EFFORT EVERY TIME WRITTEN POLICYWRITTEN POLICY ACCOUNTABILITYACCOUNTABILITY ASSIGN RESPONSIBILITYASSIGN RESPONSIBILITY ESTABLISH EXPECTATIONESTABLISH EXPECTATION

BEFORE INJURYBEFORE INJURY CONTINUOUSCONTINUOUS WORKERS’ COMP INFOWORKERS’ COMP INFO NO SURPRISESNO SURPRISES CREATE THE CREATE THE

EXPECTATION !EXPECTATION !

BEFORE INJURYBEFORE INJURY CONTINUOUSCONTINUOUS WORKERS’ COMP INFOWORKERS’ COMP INFO NO SURPRISESNO SURPRISES CREATE THE CREATE THE

EXPECTATION !EXPECTATION !

SHARE OWNERSHIPSHARE OWNERSHIP

INVOLVE INJURED WORKERS INVOLVE INJURED WORKERS IN OWN RECOVERYIN OWN RECOVERY

HELP WITH DECISIONSHELP WITH DECISIONS

UNDERSTAND THE PURPOSEUNDERSTAND THE PURPOSE

SHARE OWNERSHIPSHARE OWNERSHIP

INVOLVE INJURED WORKERS INVOLVE INJURED WORKERS IN OWN RECOVERYIN OWN RECOVERY

HELP WITH DECISIONSHELP WITH DECISIONS

UNDERSTAND THE PURPOSEUNDERSTAND THE PURPOSE

EDUCATIONEDUCATION

REVIEW ACCIDENT HISTORY*!REVIEW ACCIDENT HISTORY*!

TASK ANALYSIS*!TASK ANALYSIS*!

WORK ASSIGNMENTS - WORK ASSIGNMENTS - THEIRS AND OTHERSTHEIRS AND OTHERS

EDUCATIONEDUCATION

REVIEW ACCIDENT HISTORY*!REVIEW ACCIDENT HISTORY*!

TASK ANALYSIS*!TASK ANALYSIS*!

WORK ASSIGNMENTS - WORK ASSIGNMENTS - THEIRS AND OTHERSTHEIRS AND OTHERS

EMPLOYEESEMPLOYEES EMPLOYEREMPLOYER INSURANCE CARRIERINSURANCE CARRIER

NO SURPRISES=MORE TRUSTNO SURPRISES=MORE TRUST

EMPLOYEESEMPLOYEES EMPLOYEREMPLOYER INSURANCE CARRIERINSURANCE CARRIER

NO SURPRISES=MORE TRUSTNO SURPRISES=MORE TRUST

EXPECTATIONSEXPECTATIONS MONITOR CLAIMS ACTIVITIESMONITOR CLAIMS ACTIVITIES REQUEST RETURN TO WORK REQUEST RETURN TO WORK

SERVICESSERVICES GET INVOLVED - HELPGET INVOLVED - HELP

YOUR EMPLOYEE !YOUR EMPLOYEE !

YOUR $ !YOUR $ !

EXPECTATIONSEXPECTATIONS MONITOR CLAIMS ACTIVITIESMONITOR CLAIMS ACTIVITIES REQUEST RETURN TO WORK REQUEST RETURN TO WORK

SERVICESSERVICES GET INVOLVED - HELPGET INVOLVED - HELP

YOUR EMPLOYEE !YOUR EMPLOYEE !

YOUR $ !YOUR $ !

CONTINUOUSCONTINUOUS AWAY FROM WORKAWAY FROM WORK WHEN RETURNWHEN RETURN MONITOR PROGRESSMONITOR PROGRESS

BECAUSE YOU VALUEBECAUSE YOU VALUE

YOUR EMPLOYEES!YOUR EMPLOYEES!

CONTINUOUSCONTINUOUS AWAY FROM WORKAWAY FROM WORK WHEN RETURNWHEN RETURN MONITOR PROGRESSMONITOR PROGRESS

BECAUSE YOU VALUEBECAUSE YOU VALUE

YOUR EMPLOYEES!YOUR EMPLOYEES!

“If you don’t think you can make it intowork tomorrow, give me a call.”

IMPROVE COMMUNICATIONIMPROVE COMMUNICATION

What can YOU do?What can YOU do?

IMPROVE COMMUNICATIONIMPROVE COMMUNICATION

What can YOU do?What can YOU do?

LETTER EXPLAINING LETTER EXPLAINING PROGRAMPROGRAM

TWCC-73TWCC-73 JOB TASK ANALYSISJOB TASK ANALYSIS COORDINATECOORDINATE

PATIENCE-PERSEVERANCEPATIENCE-PERSEVERANCE& A TWO WAY STREET!& A TWO WAY STREET!

LETTER EXPLAINING LETTER EXPLAINING PROGRAMPROGRAM

TWCC-73TWCC-73 JOB TASK ANALYSISJOB TASK ANALYSIS COORDINATECOORDINATE

PATIENCE-PERSEVERANCEPATIENCE-PERSEVERANCE& A TWO WAY STREET!& A TWO WAY STREET!

SUPPORT STAY AT WORK/SUPPORT STAY AT WORK/RETURN TO WORKRETURN TO WORK

SKILLS & DEVELOPMENTSKILLS & DEVELOPMENT

NON-MEDICAL FACTORSNON-MEDICAL FACTORS

SUPPORT STAY AT WORK/SUPPORT STAY AT WORK/RETURN TO WORKRETURN TO WORK

SKILLS & DEVELOPMENTSKILLS & DEVELOPMENT

NON-MEDICAL FACTORSNON-MEDICAL FACTORS

TEMPORARY OR NOT?TEMPORARY OR NOT? TRANSITIONALTRANSITIONAL HEALINGHEALING ADA & FMLA ADA & FMLA MEDICALLY APPROPRIATEMEDICALLY APPROPRIATE PRODUCTIVEPRODUCTIVE TASKSTASKS

TEMPORARY OR NOT?TEMPORARY OR NOT? TRANSITIONALTRANSITIONAL HEALINGHEALING ADA & FMLA ADA & FMLA MEDICALLY APPROPRIATEMEDICALLY APPROPRIATE PRODUCTIVEPRODUCTIVE TASKSTASKS

WITH ‘EM - NOT TO ‘EMWITH ‘EM - NOT TO ‘EM

-MEANINGFUL & PRODUCTIVE- -MEANINGFUL & PRODUCTIVE- WORK OF VALUEWORK OF VALUE

WITH ‘EM - NOT TO ‘EMWITH ‘EM - NOT TO ‘EM

-MEANINGFUL & PRODUCTIVE- -MEANINGFUL & PRODUCTIVE- WORK OF VALUEWORK OF VALUE

““You do not get injured You do not get injured workers well to get back workers well to get back to work.to work.

You get them back to You get them back to work to get well!”work to get well!”

-Richard Pimental-Richard Pimental

““You do not get injured You do not get injured workers well to get back workers well to get back to work.to work.

You get them back to You get them back to work to get well!”work to get well!”

-Richard Pimental-Richard Pimental

Pat CrawfordPat CrawfordReturn to Work Education CoordinatorReturn to Work Education Coordinator

Rtw@twcc.state.tx.usRtw@twcc.state.tx.usPat.crawford@twcc.state.tx.usPat.crawford@twcc.state.tx.us

(512) 804-4804(512) 804-4804

Texas Workers’ Compensation CommissionTexas Workers’ Compensation Commission

Pat CrawfordPat CrawfordReturn to Work Education CoordinatorReturn to Work Education Coordinator

Rtw@twcc.state.tx.usRtw@twcc.state.tx.usPat.crawford@twcc.state.tx.usPat.crawford@twcc.state.tx.us

(512) 804-4804(512) 804-4804

Texas Workers’ Compensation CommissionTexas Workers’ Compensation Commission

Questions & Comments?Questions & Comments?

Break Time!!!!Break Time!!!!

See You at 10:40amSee You at 10:40am

Lost, Damaged, & Lost, Damaged, & Destroyed PropertyDestroyed Property

Michael L. Hay, CGFM, CPPMMichael L. Hay, CGFM, CPPM

Director of Risk Assessment Director of Risk Assessment and Loss Prevention, & and Loss Prevention, &

Information Resources - SORMInformation Resources - SORM

The new term for missing and stolen The new term for missing and stolen property is…property is…

Lost, Damaged or Destroyed (LDD)Lost, Damaged or Destroyed (LDD)

American Society for Testing and American Society for Testing and Materials Materials (ASTM) E2131.01(ASTM) E2131.01

Standard Practice for Assessing Standard Practice for Assessing Loss, Damage, or Destruction of Loss, Damage, or Destruction of

PropertyProperty

1.1. Describes the various reasons for LDDDescribes the various reasons for LDD

2.2. Defines terms specific to the standardDefines terms specific to the standard

3.3. Describes how LDD analysis can be used to Describes how LDD analysis can be used to evaluate adequacy of property Controlevaluate adequacy of property Control

4.4. Describes actions required when LDD is Describes actions required when LDD is discovereddiscovered

ASTM Standard Practice ASTM Standard Practice (cont’d)(cont’d)

5.5. Calculation of LDD Ratios (Overall and Calculation of LDD Ratios (Overall and Immediate Values)Immediate Values)

6.6. Describes acceptable ratios for various types Describes acceptable ratios for various types of organization and propertiesof organization and properties

7.7. Describes reporting requirements and Describes reporting requirements and contentcontent

8.8. Describes which parts of the standard are Describes which parts of the standard are firm criterion and which are guidelinesfirm criterion and which are guidelines

STANDARD FOR GOVERNMENT IS 2% OF VALUE STANDARD FOR GOVERNMENT IS 2% OF VALUE OR ITEMSOR ITEMS

LDDLDD

In the private sector, LDD is a pure In the private sector, LDD is a pure property risk.property risk.

In the public sector, LDD is also a In the public sector, LDD is also a political risk.political risk.

7878thth Legislature, GAA, Art. IX, Legislature, GAA, Art. IX, §11.03 §11.03 – 50% of “value” of LDD falling outside the 50% of “value” of LDD falling outside the

ASTM standard shall be withheld from ASTM standard shall be withheld from General Revenue appropriations of the General Revenue appropriations of the agency.agency.

LDD (cont’d)LDD (cont’d)

The State has historically fallen The State has historically fallen below the 2% triggerbelow the 2% trigger

GASB 34/35 raised capitalization GASB 34/35 raised capitalization thresholds for personal & real thresholds for personal & real propertyproperty

The concept of value is relativeThe concept of value is relative

LDD (cont’d)LDD (cont’d)

Historical Cost = Historical Cost = Acquisition Cost + Associated Costs Acquisition Cost + Associated Costs to Render an Asset to Serviceto Render an Asset to Service

Net Book Value =Net Book Value =Historical Cost less Accumulated Historical Cost less Accumulated DepreciationDepreciation

SORM LDD BenchmarksSORM LDD Benchmarks

Used Comptroller FY03 Data from the Used Comptroller FY03 Data from the State Property Accounting SystemState Property Accounting System

Analyzed all LDD Disposal Methods for Analyzed all LDD Disposal Methods for only SORM client agenciesonly SORM client agencies

Intended for benchmarking and internal Intended for benchmarking and internal control analysis onlycontrol analysis only

Will be made available to agencies at Will be made available to agencies at the SORM websitethe SORM website

Will be updated annually at the close of Will be updated annually at the close of the fiscal yearthe fiscal year

SORM LDD Report SORM LDD Report StructureStructure

Class Lost, Damaged Lost, Damaged Code Personal Property Class Description Controlled or Destroyed Class Value % LDD or Destroyed Class Value101 Desks 17,625.57$ 6,725,139.55$ 0.26% $3,074.67 $1,723,464.93102 Tables 17,789.70$ 4,073,794.37$ 0.44% $3,316.92 $1,155,501.55103 Chairs 4,318.68$ 5,564,051.98$ 0.08% $455.21 $2,872,132.85104 Personal Furniture: Bed, Dresser, Rocker 3,627.17$ 3,326,825.38$ 0.11% $- $1,056,742.26105 Cases, Cabinets & Credenzas 12,242.41$ 13,786,321.96$ 0.09% $2,026.49 $4,064,849.17106 Hand Guns Y 7,200.19$ 4,403,983.51$ 0.16% $3,230.65 $1,824,402.45107 Rifles Y 2,161.82$ 3,023,533.87$ 0.07% $14.21 $672,386.40108 Calculators -$ 132,530.15$ 0.00% $- $59,767.70109 Typewriters, Word Processors 13,933.84$ 2,925,851.14$ 0.48% $3.24 $40,298.64110 Other Office Furniture -$ 1,709,512.43$ 0.00% $- $963,098.84119 Vehicle Maintenance Equipment 8,739.35$ 9,068,411.04$ 0.10% $180.98 $1,154,917.98120 Photocopying Equipment 10,204.15$ 18,415,578.24$ 0.06% $52.77 $3,623,138.39121 Fax Machines, Telecopier Y 35,997.17$ 12,816,737.59$ 0.28% $2,387.37 $2,886,250.48129 Stereo Systems Y 6,611.25$ 1,308,898.58$ 0.51% $1,316.49 $465,201.43130 Cameras Y 119,237.24$ 29,694,851.36$ 0.40% $24,089.48 $10,353,681.13131 Video Recorder/Laserdisk Player (TV, VCR, Camcorder) Y 153,048.56$ 27,957,352.12$ 0.55% $16,114.26 $6,540,165.10132 Other Sound Systems/Equipment 173,392.25$ 107,529,661.50$ 0.16% $20,042.31 $32,015,247.45133 Musical Instruments -$ 9,033,831.49$ 0.00% $- $1,957,122.08134 Recreational Equipment: Bicycle, Pool Table -$ 1,165,810.11$ 0.00% $- $528,401.09135 Video Conferencing Equipment -$ 11,766,238.43$ 0.00% $- $5,292,115.39136 GPS Equipment 3,295.00$ 1,686,144.53$ 0.20% $- $585,250.63

HISTORICAL COST BY CLASS NET BOOK VALUE BY CLASS

LDD Total for Historical and Net LDD Total for Historical and Net BookBook

Class Lost, Damaged Lost, Damaged Code Personal Property Class Description Controlled or Destroyed Class Value % LDD or Destroyed Class Value % LDD730 Boats (other, canoe, rowboat) -$ 1,128,944.50$ 0.00% $- $263,088.63 0.00%731 Aircraft (jet) -$ 2,455,901.64$ 0.00% $- $670,531.99 0.00%733 Airplane (multiple engine, propeller) -$ 17,934,757.21$ 0.00% $- $5,080,156.19 0.00%734 Aircraft (helicopters) -$ 8,247,452.00$ 0.00% $- $3,543,709.27 0.00%750 Other Aircraft -$ 1,468,470.90$ 0.00% $- $279,295.00 0.00%751 Books & Reference Materials -$ 30,816,602.12$ 0.00% $- $25,185,614.29 0.00%752 Library Books & Reference Materials -$ 438,825,430.27$ 0.00% $- 438,825,430.27$ 0.00%801 Works of Art, Historical Treasures (Depreciable) -$ 40,996,512.71$ 0.00% $- $30,420,189.39 0.00%802 Works of Art, Historical Treasures (Not Depreciable) 75.00$ 192,136,033.20$ 0.00% 75.00$ 192,136,033.20$ 0.00%840 Artifacts -$ 100,900.00$ 0.00% -$ -$ 0.00%851 Horses -$ 312,065.91$ 0.00% $- $29,846.04 0.00%852 Cows -$ 54,286.02$ 0.00% $- $5,164.64 0.00%853 Sheep -$ 35,040.00$ 0.00% $- $5.07 0.00%854 Swine -$ 305,505.06$ 0.00% $- $- .855 Other Livestock/Animals 4,308,253.05$ 3,468,668,288.27$ 0.124% $- $70,626.04 0.00%

Totals $8,616,506.10 $6,937,336,576.54 0.12% $532,757.36 $1,435,675,438.61 0.04%

HISTORICAL COST BY CLASS NET BOOK VALUE BY CLASS

LDD Sorted by % Historical LDD Sorted by % Historical CostCost

Class Lost, Damaged Code Personal Property Class Description Controlled or Destroyed Class Value % LDD526 Micro Tomes, Diamond Knives, Sharpeners 12,200.00$ 632,525.97$ 1.93%255 Protocol Converters 6,279.90$ 349,956.09$ 1.79%536 Ultrasound Equipment 14,800.00$ 1,808,250.78$ 0.82%250 Modem, External 52,411.19$ 6,478,581.73$ 0.81%257 Data Communications Diagnostic Systems 14,543.41$ 2,173,887.72$ 0.67%531 Recording Systems 14,765.04$ 2,602,519.56$ 0.57%284 Portable CPU (not Apple) Y 374,110.53$ 68,054,716.04$ 0.55%131 Video Recorder/Laserdisk Player (TV, VCR, Camcorder) Y 153,048.56$ 27,957,352.12$ 0.55%519 Hood (all types) 5,206.29$ 966,961.57$ 0.54%218 Data Projectors: 'Proxima' or Dataviewers w/o Projector 48,933.18$ 9,298,018.98$ 0.53%140 Other Assets 5,618.44$ 1,098,296.52$ 0.51%129 Stereo Systems Y 6,611.25$ 1,308,898.58$ 0.51%109 Typewriters, Word Processors 13,933.84$ 2,925,851.14$ 0.48%294 Portable Apple CPU Y 19,838.21$ 4,314,401.83$ 0.46%524 Meters, Gauges, Indicators 41,203.28$ 9,015,424.37$ 0.46%

HISTORICAL COST BY CLASS

LDD Sorted by % Net Book ValueLDD Sorted by % Net Book Value

Class Lost, Damaged Code Personal Property Class Description Controlled or Destroyed Class Value % LDD519 Hood (all types) 2791.25 $444,755.95 0.63%218 Data Projectors: 'Proxima' or Dataviewers w/o Projector $21,612.65 $4,117,848.43 0.52%284 Portable CPU (not Apple) Y $134,570.48 $29,123,867.28 0.46%219 Palm Pilots, Other Hand-Helds $1,228.42 $295,029.98 0.42%524 Meters, Gauges, Indicators 13593.21 $4,113,787.47 0.33%102 Tables $3,316.92 $1,155,501.55 0.29%536 Ultrasound Equipment $1,999.00 $685,749.90 0.29%129 Stereo Systems Y $1,316.49 $465,201.43 0.28%131 Video Recorder/Laserdisk Player (TV, VCR, Camcorder) Y $16,114.26 $6,540,165.10 0.25%130 Cameras Y $24,089.48 $10,353,681.13 0.23%504 Balance 1146.57 $573,159.21 0.20%294 Portable Apple CPU Y $3,441.37 $1,811,100.00 0.19%101 Desks $3,074.67 $1,723,464.93 0.18%106 Hand Guns Y $3,230.65 $1,824,402.45 0.18%150 Instructional Equipment $6,863.57 $3,886,258.26 0.18%

NET BOOK VALUE BY CLASS

Questions & Comments?Questions & Comments?

Introduction to New Introduction to New Executive Director of Executive Director of

SORMSORM

Jonathan D. BowJonathan D. Bow

Questions & Comments?Questions & Comments?

Investigation MethodsInvestigation Methods

Sam StoneSam Stone

SORM Training SpecialistSORM Training Specialist

““MishapMishap””

InvestigationInvestigation

&&

AnalysisAnalysis

The Investigation ProcessThe Investigation Process

Root Cause& Prevention

Validation

Mishap

Compensable

NotCompensable

ADSO ClassADSO Class

Mechanics of an InvestigationMechanics of an Investigation

Root Cause AnalysisRoot Cause Analysis

Sequence of EventsSequence of Events “Z-Process Model” “Z-Process Model”

Procedures

Training

Supervision

Material/Design

Acts/Practices

ConditionsMishap

(Break down) (Consequence)(Result)

Example of Analysis DiagramExample of Analysis DiagramForklift

Hits Ladder

Ladder inDoorway

ForkliftCouldn’t Stop

No BarrierSigns

ForkliftBrakes

Defective

Cooking Oil on Floor

ForkliftGoing Too

Fast

BrakeMaintenance

Delayed

HousekeepingInadequate

Speed LimitsNot Enforced

Or

Lack ofPersonnel

NoPolicy

NoEnforcement

NoEnforcement

Unsafe Act Unsafe Condition

Management Safety Policy & DecisionsPersonal Factors

Environmental Factors

ACCIDENTPersonal Injury

Property Damage

Unplanned Release of Energyand/or

Hazardous Material

BASICCAUSES

INDIRECTCAUSES(SYMPTOMS)

DIRECTCAUSES

A detailed analysis of an accident will normally revealthree cause levels: basic, indirect, and direct.

Fishbone AnalysisFishbone Analysis

Fishbone AnalysisFishbone Analysis

LampWon’tWork

Fishbone AnalysisFishbone Analysis

LampWon’tWork

Bulb

Fishbone AnalysisFishbone Analysis

Lamp

LampWon’tWork

Bulb

Fishbone AnalysisFishbone Analysis

Plug/Cord Lamp

LampWon’tWork

Bulb

Fishbone AnalysisFishbone Analysis

Plug/Cord Lamp

LampWon’tWork

BulbPower

Fishbone AnalysisFishbone Analysis

Power

Plug/Cord Lamp

LampWon’tWork

Switches

Storm

Dogchewed

UnpluggedBrokenSwitch

MissingSwitch

Corroded

Burnedout

Loose

Bulb

USEFUL TOOLSUSEFUL TOOLS

Bring Along Some HelpBring Along Some Help ChecklistChecklist

Tape MeasureTape Measure

Tape MeasureTape Measure

CameraCamera

AttitudeAttitude

Be PositiveBe PositiveFFact-Finding, Not Blame-Findingact-Finding, Not Blame-Finding

Identify, Encourage, and Reward Identify, Encourage, and Reward Safe and Proactive Work PracticesSafe and Proactive Work Practices

What Are People Doing Right?What Are People Doing Right?

Catch people doing something right.Catch people doing something right.

Corrective ActionCorrective Action ENGINEERINGENGINEERING

– Most ExpensiveMost Expensive– Most PermanentMost Permanent

ADMINISTATIVEADMINISTATIVE– Procedure (or lack of procedure)Procedure (or lack of procedure)– TrainingTraining– SupervisionSupervision

PERSONAL PROTECTIVE EQUIPMENTPERSONAL PROTECTIVE EQUIPMENT– What can be done to protect the What can be done to protect the

employee?employee?

Covered State Agencies Reported Injuries Covered State Agencies Reported Injuries FY2003FY2003

1888

1582

1150 1133

368304 292

210286

Strain Fall/Slip Struck Agg. Cut Caught Motor Veh Burns Misc.

0

500

1000

1500

2000

Questions & Comments?Questions & Comments?

WC Cost Allocation WC Cost Allocation ProgramProgram

Stuart B. CargileStuart B. Cargile

SORM CFOSORM CFO

Questions & Comments?Questions & Comments?

FY03 Safety AwardsFY03 Safety Awards

Sustained AwardSustained Award

Small Agencies (100 FTE’s or less)Small Agencies (100 FTE’s or less)– No Reported Losses Three or More No Reported Losses Three or More

YearsYears

Major AgenciesMajor Agencies– Lower IFR and cost per FTE for each Lower IFR and cost per FTE for each

of the past five yearsof the past five years

Bronze AwardBronze Award

IFR decrease of 10% to 29% below IFR decrease of 10% to 29% below the average of the prior five years the average of the prior five years IFR.IFR.

Silver AwardSilver Award

IFR decrease of 30% to 49% below IFR decrease of 30% to 49% below the average of the prior five years the average of the prior five years IFR.IFR.

Gold AwardGold Award

IFR decrease of 50% or more IFR decrease of 50% or more below the average of the prior five below the average of the prior five years IFR.years IFR.

Risk ManagementRisk ManagementUser GroupUser Group

Thank you for attending!Thank you for attending!