Integrity Based Budgeting for Management of Large Facility Portfolios

This excellent article from Facilities Manager (PDF) describes the experience of the U.S. Department of Defense with regard to the integration of data for support of capital budgeting of 800,000 facilities across various defense departments and agencies such as the Army, the Navy, and the Defense Logistics Agency.

Three important issues were critical to the evolution of a solution. First, what degree of accuracy was affordable? Second, with over 800,000 properties, how could this number be distilled to make a solution understandable to the user and still retain meaningfulness? And third, how would facilities requirements be defined? . . . Making all this work was somewhat like the famous Monty Python sketch teaching children how to play the flute on the children’s show, Blue Peter. The sketch taught the flute by saying you simply blow through here and move your fingers up and down, and “that’s how to play the flute.” While clearly an over-simplification, the next step for SRM was to build cost models for each of the FACs – these included sustainment (what should be spent), modernization (what should be designated for facilities renewal), and most recently operations models for each, covering utilities, fire and emergency services, pest control, pavement clearance, research reports, and state/local governments. The second source category is defined as costs obtained from DoD sources. The third source, representing only 3 percent of the total requirement, is developed by analogy to other FACs of similar complexity and durability. This category represents those very few unique facilities that typically only the military owns – for example, missile shelters or gunnery ranges.