Survey Statistics - CitiTech Systems Inc.

The majority of responses were from small cities and towns. Unlike their urban cousins, these cities lack large budgets to employ management analysts, system designers and efficiency experts. These cities and towns work with limited staff and have a job to do. Interspersed in their duties of providing services to their communities, they attempt to evaluate operations and procedures.

Most of the responses came from the midwest (Illinois, Indiana, Iowa and Nebraska). Operating with an average public works budget of less then $2 million, these communities maintain an average of 110 miles of roadway, employ an average of 29 people, and maintain 70 pieces of equipment.

The city finance office plays a major role in department accounting. Almost 59% of the cities rely solely on the finance office for fiscal accounting. Another 40% share accounting responsibilities with the finance office. With few exceptions, these cities maintained less than 10 fund accounts to manage their operations. Sixty-six percent were satisfied with their accounting reports, classifying them as "timely and accurate". The remaining 34% felt the accounting reports were either inadequate or could be improved.

Cost Accounting

An effective cost accounting system is essential in today's economy. Managers and planners need to know where the money is being spent. They need detailed information on project and equipment costs and employee productivity.

Surprisingly, less than half of the departments do any cost accounting. That's probably due to the way city government operates. Typically the department submits a budget and operates within that budget. Normal employee, operational and maintenance expenses are simply forwarded to the finance office for payment. There is usually no analysis performed on this data.

Unfortunately, lacking an effective cost accounting system has a direct impact on efficient operations. Without solid cost information, it is difficult, if not impossible, to evaluate operations.

Of those departments that do cost accounting, have do project cost accounting, tracking costs on a project basis. Only one-third do cost accounting on an employee or equipment basis, and only 6% account on an inventory basis.

Interestingly, almost 75% of the departments don't allocate for general overhead. Overhead is an important cost factor. General overhead costs are supervisory costs, facility costs, equipment depreciation and other items. These are hidden costs and can dramatically alter department cost-effectiveness. Typically, these costs are not associated with a specific project, equipment item or labor cost. In allocating general overhead, a percentage of the total overhead expense is typically applied to projects, equipment and/or operations. This percentage is usually based on a variable, such as labor costs, equipment costs or project costs. Every labor dollar, for example, could include a certain percentage to account for general overhead costs.

Of the 25% that do allocate for general overhead, most allocate on a labor or equipment basis, although project allocations were also used. Many departments use more than one method to allocate overhead.

Tracking Costs

Cost tracking is the basis of cost control and essential in improving operations. Without detailed cost information, it's difficult to analyze where the money is going and what are we getting for our money. In the work-a-day world, there is a tendency for status quo. Just get the job done. Too often, the extra effort needed to associate costs with jobs, equipment items or other structures is too difficult or cumbersome. But, taking the extra time can yield dramatic results.

Indianapolis tracked costs and cut pothole repair costs by 38%. Kings Mountain, NC saved thousands on sign replacement. The success stories are everywhere and result in more efficient, responsive government.

In determining how a city tracks costs, the survey examined four main areas:
Employee Costs, Equipment/Repair Parts Costs, Project Costs Inventory Costs

Employee Costs: Driven primarily by payroll considerations, most departments track employee costs. Almost 81% maintain payroll, vacation and sick leave data and 71% use an automated payroll system. The common method of tracking employee costs was "department-wide" with 64% using that method. When it came to tracking employee costs by project or equipment item, however, the results were suprisingly low. Only 33% kept track of employee costs by project or equipment item.

Also surprising was how these departments kept track of employee costs. Only 18% of the departments use a computer to track these costs, with the majority (59%) tracking costs by hand. The remaining 23% didn't track employee costs at all.

This is significant because improving employee productivity is directly related to how well the department tracks employee costs. Without employee cost information, ideally managed on a project, equipment item or other basis, employee productivity cannot be determined. Only 31% of those surveyed tracked employee productivity, although another 27% want to develop procedures.

Equipment/Repair Parts: A higher percentage of departments track equipment costs and, of those who didn't, more were interested in tracking equipment costs than they were in tracking employee or project costs. This is due, in large measure, because of how street departments work. Being equipment oriented, maintaining repair part inventories and conducting regular maintenance places higher importance on equipment maintenance management.

Most of those surveyed track equipment costs by department and 38% use a computerized fleet management or maintenance system.

Almost 52% track costs by department, with another 22% wanting to do so. Only 24% track equipment costs on a project basis and 38% track equipment costs on an equipment item basis. As with other responses in this category, 22% of those who were not tracking equipment costs on a project or equipment item basis wanted to do so to improve cost control and overall management.

Departments scored fair marks on keeping track of fuel, oil, tires and repair parts on an equipment item basis. Almost 46% currently track these costs and an additional 29% want to establish tracking procedures, although they don't currently have any method in place. Half of the departments use an automatic fuel system to control fuel costs.

Likewise, a fair percentage of departments schedule equipment maintenance. Almost 42% currently schedule maintenance and another 21% want to start. One would thing 100% of the departments would schedule preventative maintenance, since studies have shown that a good preventative maintenance program results in less equipment failures and a lower overall equipment cost. But, a significant 38% indicated no maintenance scheduling program.

Moreover, 27% of the departments don't track equipment costs at all. Of the remainder, 35% track costs by computer, 35% track costs by hand and 3% use both computerized and manual tracking methods.

Project Costs: Tracking project costs have a political and social implication. Keeping track of project costs on a department, precinct or street basis gives the department head or city official an overview of what's being done and in what areas of the communities.

Taxpayers and citizens are always complaining that enough isn't being done to maintain their individual street or road. That's to be expected, since potholes and street maintenance is one of the most visible elements of the community. But, unfortunately, public works directors or street superintendents have to answer these concerns and complaints. Many times, simply tracking project costs isn't enough. One midwestern public works director tracked work and improvements by each street, but when an angry taxpayer complained to city council, it took two people six months looking through boxes of records to research the complaint, plus many more hours analyzing the information.

The problem was that although the director tracked costs, they were kept on paper records and very difficult to access and analyze.

Sixty-two percent of the departments track project costs and an additional 8% want to start tracking project costs. Most departments (83%) schedule work projects in advance and budget for them. Several departments complain that cost overruns cause them to exceed budget and they can't react soon enough to control overall project costs.

About half of the departments allocate employee, equipment or material costs to projects and an additional 12% want to start. Of significance, almost 40% of the departments don't allocate these costs to projects, pavement segments, bridges, signs or other cost centers. That results in incomplete or inaccurate project costing. Unless the costs for labor, equipment and inventories are included in the equation, how can a department track actual, instead of projected, costs.

Inventory Costs: Material inventories and repar part inventories were considered as one category. These are viewed as expendable and consumable items that are used in the normal course of operations.

Inventory, with all the little nuts and bolts, tons of material and gallons of fuel and lubricants, definitely account for a major portion of street department operations and costs. Yet, only 25% of the departments utilize an inventory or material control system and, of those that track inventory, 53% use manual inventory management systems, 29% use a computer and 18% use both computerized and manual systems.

Tracking inventories is, at best, a difficult job. A constant flow of materials, fuels, lubricants and repaair parts passes through a typical street department. In the normal course of operations, consumable parts are consumed. It became evident that most departments don't implement an effective inventory control system because of the volume of transactions are too immense and diverse.

Consequently, the typical department manages inventories reactively, not proactively. It appears to be more important to simply have sufficient inventories on hand than to plan for inventory usage using world-class management systems, such as Material Resource Planning.

Material Resource Planning is a process in which inventory requirements are projected. Understanding changes in usage and market prices allows the department to forecast for upcoming projects and procure inventory at the best prices. Material Resource Planning is a specialized application of inventory management in that it is forward-looking, rather than simply an inventory control system.

About half of the departments maintain more than one repair or storage facility, with inventory and repair part items totalling in the thousands of units. Survey results indicate departments are more successful in managing repair parts and equipment fuel and lubricants than they are in managing storage site inventories.

Highway Safety

Highway safety is an area that is gaining in importance today. In today's litigious society, traffic accidents occur and law suits are filed regularly based on traffic safety issues. Highway safety embraces a number of issues, ranging from potholes and deteriorating roadways or bridges to signage and obstructions.

Many times, highway safety issues are shared with the traffic department, although most street departments are responsible for the repair and maintenance of highway safety items.

Only 35% of those surveyed track highway safety items, such as bridges, culverts, guardrails, lights and signs, but another 30% want to start. Most of the departments (60%) budget for the repair and maintenance of highway safety items, with an additional 12% of the departments wanting to start.

Of particular significance is the number of departments that felt lawsuits or litigation was possible due to missing or poor quality highway safety items. Almost 60% felt a lawsuit was possible.

Researching a resonable defense in highway safety lawsuits, the most effective approach is positive management. A pro-active program to identify and classify highway safety issues, accompanied with data that details specific actions taken to correct or eliminate those hazards, has been shown to be more effective. The key is solid highway safety information based on regular inspections and maintenance.

Highway safety, along with environmental issues, will become increasingly important. New federal programs and guidelines are requiring departments to devote more time and energy to those areas. Possible litication will become only one of the reasons why city departments begin tracking highway safety issues.

Road Classification

Virtually all departments classify roads as primary, secondary, arterial, collector or other criteria. About 41% track road maintenance by precinct, location or road type and another 18% hope to implement a road maintenance program.

Several departments are using maps to classify road maintenance and new GIS mapping software is gaining in popularity. Almost 20% of those surveyed are considering GIS mapping programs.

Over half of the departments maintain a street log to chart structural data and maintenance history and an additional 25% want to start a street log program. The survey reveals that road or pavement management was the mose desired computer software application and the strong move toward street logs confirm survey findings.

Although 30% of the departments don't track road data on an on-going basis, of the remaining 70%, more departments use computer tracking rather than manual methods. Fifty percent of those that do track road data use a computer, while 38% use manual systems. Twelve percent use both computer and manual methods to keep track of road data.

User Complaints/Comments

Tracking user complaints and comments, as well as the action taken, is one of the most sought applications within the street departments. Most of the departments (71%) currently track user complaints and another 21% want to start a tracking program.

Many of the departments commented that their tracking efforts were one of their most important functions because it provides first-line contact with their constituencies. Despite this importance, 60% of the departments track user complaints by hand with only 4% using a computer and 12% using both computer and manual systems.

Computer Assets

Computers have become a regular fixture at most street departments. Seventy-two percent of those surveyed currently have a computer, with an additional 12% planning to purchase one in the future. Most of the computers are standalong PC computers, with 58% of departments using this inexpensive approach. Seventeen percent of the departments have developed networked systems with several PC computers connected together to share information. The remaining 25% operate as terminals on a larger city-wide mainframe system.

The key to the successful implementation of a computer system isn't merely the fact that the department has a computer, but rather "HOW" the computer is being used.

In this area, the survey clearly shows that the department's computer assets are usually underutilized.

The clear purpose of a computer system is to achieve information management goals; collecting data and then producing management reports that allow the department to manage more effectively. A properly designed system should not only improve management information, but should also streamline operations and automate mundane tasks that are best accomplished by computer.

How are street departments using their computer assets? Are their computers helping the department operate more efficienty and provide better management control?

The survey revealed that, while the departments have computer assets, most of the departments are not using these resources to reach maximum productivity and efficiency. An examination of the applications in use produced the following results:

Word Processing: Clearly, the most common application in the street department was word processing. Virtually all departments (95%) use word processing software. Despite the common use, however, the departments ranked word processing software in the lower 15% in terms of importance. It appears word processing is an important tool, but not the specialized software most desired by today's department.

Fleet Management: A computerized fleet management system is designed to automate fleet usage and maintenance. Thirty-seven percent of the departments currently use a fleet management system and another 47% want one. Sixteen percent of the departments expressed "no interest" in this application. Larger towns, communities over 25,000, tend to have a higher concentration of fleet management systems. In ranking the importance of fleet management, departments place the application in the top 20% of software solutions.

Project Management: A computerized project management system is designed to track project costs and scheduling issues. Some applications use flowcharts, such as CPM, PERT, GANTT and others to track scheduling. Only 25% of the departments use project management systems, although another 70% want to implement one. Departments rank project management software in the top 15% in terms of importance.

Inventory: Only 19% of the departments use a computerized inventory control system, but an additional 69% want one. Twelve percent expressed "no interest" in the application. Inventory management didn't rank very high in importance, falling to the lower 20%.

Job Costing: Job costing is a specialized accounting application. Unlike typical accounting programs, job costing uses a more detailed method to track specific costs and apply those costs to specific jobs or other items. The objective is to give management a detailed analysis on costs based on a per-job, per-equipment item, per-pavement segment or other basis. Only 21% of the departments are currently using computerized job costing, but an impressive 68% want to implement a program. Job costing ranks in the top 40% in terms of importance.

Budgeting: Budgeting was one of the most-used software applications. Sixty-three percent of the departments currently use budgeting software and the remainder (37%) want to use one. The budgeting software is most often based on spreadsheet software, which operates independently of other accounting software. Most of these spreadsheets were developed in-house to perform budgeting functions. In terms of importance, however, budgeting software didn't rank very high. The survey placed the mid-point in the lower 40% of applications.

Accounting: Accounting was also one of the most used applications, but it was clear street superintendents don't want to be accountants. While 50% of the departments currently use accounting software and another 39% want to start, 11% aren't interested. Accounting software, like budgeting software ranks in the lower 40% of the applications in terms of importance.

Payroll: Payroll is another accounting program that is widely used. Over 72% of the departments currently use computerized payroll software. Of interest is that only an additional 11% of the departments want to implement the system and 17% expressed "no interest" in payroll software. As with other accounting software, payroll ranks in the lower 40% in terms of importance.

Highway Safety: Highway safety software is a highly-specialized software program and most of the departments use manual systems to track information. Almost 24% currently use this software with another 65% wanting to use one. Despite the fact that almost 60% of those surveyed felt that a lawsuit was possible based on highway safety issues, the departments ranked the application in the lower 40% in terms of importance.

User Comments/Complaints: While only 11% of the departments use a computerized system to track user comments and complaints, the remainder (89%) want one. Like highway safety software, user comment software is highly-specialized and not readily available an an "off-the-shelf" application. In ranking the importance of the software, departments placed the application in the upper 25%.

Pavement Management: Pavement management was the most wanted software considered and it placed in the top 5% of all software applications. Thirty percent of the departments use pavement management software and another 65% want to implement it. Several standalong applications have been developed and the survey failed to identify any particular software as the best available software.

CAD/CAM: Computer-assisted design and computer-assisted manufacturing software has gained in acceptance in the last few years. Several departments are using the software, most commonly in the engineering departments. A third of the departments now use the software with another 50% wanting to implement the system. Almost 17% of the departments expressed "no interest" in the application. When asked to rank the importance of CAD/CAM, the departments placed it at the bottom of the pile, ranking even below word processing in terms of importance. CAD/CAM software ranked in the lowest 5% of software applications.

Other Software: Two categories of software surfaced through the survey, GIS mapping software and "environmental" software. Both are relatively new applications and the survey didn't address these emerging technologies. Of interest, while only 5% of the departments use GIS mapping software, another 15% want to implement one. Similarly, environmental software is gaining in importance, driven in large part by new federal guidelines that affect landfill operations and solid waste management. The only indications of environmental software that are currently being used were developed "in-house".


	Survey Statistics