RECENT BLOG POSTS

Join Us at the MCi-One Conference (Feb 7-9, 2018 Ė Woodlands Resort)

Posted by Management Controls on Dec 22, 2017

Whether you are an executive, business user, or technical user,...
Read More

Track Anywhere Track Anytime

Posted by Chris Frizzell on Nov 15, 2017

Wait a second ÖÖ.I didnít order...
Read More

FORTUNE GLOBAL 5 REFINERY SAVES OVER $2.1 MM IN ONLY SIX WEEKS

Posted on May 06, 2012

Once the ACS Gate Log was automated and the owner's pay rules and schedules applied, there was a significant decrease of Straight Time, Over Time and Double Time for a savings of 11.7%.  These savings originated from offsite work validated by the owner, early out gate punches, late arrival gate punches and various other situations that weren't aligned with the Terms and Conditions of the contract.

The table below shows the Total calculations and what should have been invoiced and paid by the owner.  The Owner paid $18MM for just these three contractors during the 45-day turnaround when they should have paid $2.1MM less.

TRACK CALCULATED HOURS

  Contractor 1 Contractor 2 Contractor 3 TOTAL
Track Calculations        
ST Hours 50,192.75 61,181.00 41,839.25 153,213.00
OT Hours 17,128.75 18,821.00 13,048.00 48,997.75
DT Hours 1,915.50 5,668.00 2,346.25 9,929.75
TOTAL Hours 69,237.00 85,670.00 57,233.50 212,140.50
TOTAL Dollars $5,437,466,05 $6,673,995.41 $3,947,040.56 $16,058,502.03
         
Delta Hours 9,537.50 9,128.00 2,358.50 21,024.00
Delta Dollars $1,041,912.50 $891,930.95 $197,797.74 $2,131,640.79

Detailed Contractor Findings

Each contractor was analyzed fully and detailed below are the various findings.  As you can see, each contractor had varying degrees of contractual compliance issues:

Contractor 1

  • Hours on the invoice appear to be based on time-on-site rather than scheduled time.
  • Billable time is routinely rounded up to next half-hour increment. ¬†Even when only a few minutes of the half-hour are worked, the entire half-hour increment is billed.
  • There are 479 occurrences of personnel arriving more than five minutes late.
  • There are 906 occurrences of personnel exiting the refinery 10-20 minutes early.
  • There are 223 occurrences where onsite time is less than two hours, but the corresponding invoice time is greater than four hours.
  • Out of 7,254 invoice-detail lines, Track found 4,546 discrepancies -- some of which are legitimate differences due to off-site work, etc.
  • Out of 7,254 invoice-detail lines, 3,270 have discrepancies of two hours or less.¬† This is significant because smaller variations are less likely to be explained as off-site work.
  • The Track-calculated invoice error rate is 8.89% on hours and 12.87% on dollars.

Contractor 2

  • On five occasions, it appears that a four-hour minimum was used for billing.¬† Procurement indicates that a two-hour minimum is contractual. ¬†Contract compliance is difficult when left to manual processes.
  • There are 23 occurrences of personnel arriving more than five minutes late.
  • There are 482 occurrences of personnel exiting the refinery 10-20 minutes early.
  • Out of 8,941 invoice-detail lines, Track found 3,041 discrepancies, some of which are legitimate differences due to off-site work.
  • Out of 8,941 invoice-detail lines, 2,267 have discrepancies of two hours or less.
  • The Track-calculated invoice error rate is 4.99% on hours and 7.15% on dollars.

Contractor 3

  • Hours on the invoice appear to be based on time calculated from first-in to last-out badge events. ¬†This method discounts interim time off-site and doesn't account for hours worked within schedule.
  • A two-hour minimum was applied to all personnel regardless of hours worked.
  • There are 23 occurrences of personnel arriving more than five minutes late.
  • There are 994 occurrences of personnel exiting the refinery 5-10 minutes early.
  • There are 24 occurrences of personnel exiting the refinery 10-20 minutes early.
  • Out of the 6,315 invoice-detail lines, Track found 918 discrepancies, some of which are legitimate differences due to off-site work.
  • Out of 6,315 invoice-detail lines, 610 have discrepancies of two hours or less.
  • The Track-calculated invoice error rate is 3.58% on hours and 4.39% on dollars.

 

The Analysis Process

Track starts with a standard process for Analysis and then customizes it for each Owner.  This ensures an accurate and complete review, giving Track total confidence that the savings clamied can be substantiated:

  • Select sample data (turnaround activities -- April1-May 15)
    • Contractor 1 -- 303 personnel
    • Contractor 2 -- 405 personnel
    • Contractor 3 -- 208 personne¬†
  • Collect data required for Track setup and execution
    • ACS perimeter gate IN and OUT badge events
    • Contractor personnel (company, name, craft)
    • Contract T's & C's
      • Labor rates by craft (straight, premium, shift differentials)
      • Pay calculation rules
        • Early time before schedule; late time after schedule
        • Rounding, grace period
        • Lunch deduction
        • Overtime rules (e.g., OT>40 hrs./wk.)
    • Work schedules by personnel (shift schedule start and end times)
  • Collect invoices submitted by the vendors for selected timeframe
    • Labor invoices
    • Timesheet back-up details
  • Set up Track master data
    • Prepare gate-event data for import
    • Configure Track Agreements, Skills, Rates, Schedules and Pay Formulas
    • Resolve personnel name discrepancies between gate log and invoice/timesheet records
    • Assign personnel to appropriate work schedules
    • Resolve missing IN/OUT events
  • Execute Track -- daily/day-to-day basis
    • Eliminate unresolved data exceptions to ensure integrity in the data sample
    • Calculate results by company, by person, by day
  • Compare Track results to invoice documentation
    • Load Invoice/Timesheet details into Excel
    • Load Track calculated values into Excel
    • Identify mismatches
  • Analyze mismatches to ensure completeness and accuracy of data
    • Eliminate incomplete or invalid data samples
  • Publish the report and present findings

 

To learn more, call 800.532.8348 and speak with a member of the Track Software Consulting Services Team.