Brief descriptions of representative projects in various industries: Electric, Gas & Water, Telecommunications, Government, Private Sector.

Electric, Gas & Water Utility Assignments


AEP / Kentucky
Hazard, Kentucky


Performed an assessment of the reliability of service within AEP/Kentucky’s distribution system in its Hazard service territory (a forested mountainous terrain). This region has historically experienced a greater number of electric service interruptions than other AEP/Kentucky service areas, and additionally, these interruptions have tended to be of longer in duration.

 


Arkansas Public Service Commission
Little Rock, Arkansas


Trained Arkansas Public Service Commission (APSC) members in how to monitor and control a management and operations review of Arkansas Power and Light Company and its parent organization, Entergy Corporation. This project included a written and oral review of the proposal and detailed work plan prepared by the team of outside consultants selected by APSC to perform the management review. Assisted the APSC in managing the project, which included quality control checks of the outside consultant project team and its results.


Baltimore Gas & Electric Company Columbia of Maryland Inc.
Washington Gas Light Company
Baltimore, Maryland


Performed a two-year review of gas supply and purchasing practices. This unique project included formal training of Maryland Public Service Commission staff members in gas supply review methods and the establishment of formal MPSC gas purchasing reporting requirements for the three companies beginning in 1989. Schumaker & Company provided oversight to MPSC staff during an internal review of gas supply plans submitted for 1989/90 by these gas distribution companies.


Central & South West Company
Reviewed charges for services provided by a public utility holding company to its affiliates. The review was used to determine whether the services were reasonable, necessary, non-duplicative and calculated in compliance with appropriate allocation formulas.

Central Maine Power Company
Augusta, Maine

Performed a focused management review of the implementation for CMP’s Customer Service System. Provided testimony at a general rate hearing in which a portion of the implementation costs was disallowed for ratemaking purposes, due to mismanagement at CMP.

Evaluated CMP’s organizational structure and staffing, executive compensation, customer service operations, management efficiency, and cost control. Our findings and conclusions were referenced when State Commissioners granted only 31% of the $83 million dollars rate increase requested. The savings we identified were credited for about $26 million of that reduction. Following the rate decision, CMP’s Board approved an integrated cost-containment plan that included both capital and operating budget reductions and a 42% cut in its quarterly dividend. The restructuring saved $10 million in the first year after our management review. CMP emerged a stronger, more viable competitor, on a course to permanent improvement in all aspects of business management.


City of Coldwater Board of Public Utilities
Coldwater, Michigan


Developed, performed, and analyzed the results of a customer survey (a follow-up to a survey two years earlier) to assess satisfaction with the city utility and other city services.

City of Niles – Utilities Department
Niles, Michigan


Performed a management and operations review and assisted in developing a long-term action plan. For this 55-person municipal department, we identified potential annual benefits approaching $250,000.

City of Sturgis
Sturgis, Michigan

Performed a management and operations review of various city departments, conducted a customer satisfaction and needs assessment, and developed a strategic plan. Addressed the changes occurring within the electric utility industry and the competitive threats felt by the Electric Operations Department. The effort involved: (1) performing a competitive assessment and benchmarking, (2) surveying customer attitudes to identify issues that required addressing in the strategic plan, (3) conducting a management and operations review of the relevant city departments, (4) assisting the electric utility in conducting a strategic planning session.

City of Tacoma, Department of Public Utilities, Light Division
Tacoma, Washington

Assisted with a comprehensive review and assessment of its Transmission and Distribution (T&D) management and operation practices. Schumaker & Company applied an enterprise performance management approach that emphasized the relationship between service levels and costs. The mission of the enterprise was to provide good service at the lowest long-term total cost. Further, every enterprise management team has the responsibility to develop, implement and execute a performance management program that delivers measurable good service at the lowest long-term total cost. The Schumaker & Company approach evaluated the service and cost performances of Tacoma Power’s T&D Section and recommended improvements in service levels as appropriate and cost reductions as practical.

Dayton Power & Light Company
Dayton, Ohio

Provided fuel cost recovery rider audit co-sourcing assistance to Dayton Power and Light Company (DP&L) to prepare DP&L for its annual review and audit that will take place in the first quarter of 2011 for calendar year 2010.  This engagement was a focused management audit of all operational and managerial aspects of DP&L's fuel procurement functions for January 1, 2010 to April 30, 2010 and included the fuel cost recovery rider, actual fuel and purchased power costs, contracts, and management performance that affect the audit.

Duke Energy Kentucky
Cincinnati, Ohio

Assisted Duke Energy Kentucky (DEK) with an affiliate management audit in response to the necessity of an affiliate management audit of DEK every two years as ordered by the Kentucky Public Service Commission (KPSC) in Case No. 2005-00228. In 2006, Cinergy Corp., the parent company of Union Light, Heat and Power Company, subsequently re-named Duke Energy Kentucky, merged with Duke Energy Corporation. As part of its approval of the merger, the KPSC established forty-six merger commitments in Case No. 2005-00228, of which three (3), specifically Commitments 11- proper accounting of costs, 12- maintaining appropriate cost allocation procedures and committing to third-party audits, and 13- protecting against cross-subsidization specifically related directly to this audit. Schumaker & Company consultants looked for economies, efficiencies, or improvements to benefit DEK and its ratepayers.

Duke Energy Indiana, Inc.
Indianapolis, Indiana

Provided an affiliate standards audit of Duke Energy Indiana, Inc. (DEI) for the Indiana Office of Utility Consumer Counselor (OUCC). This audit was required by the approved Settlement Agreement in Cause No. 42873 (Settlement) concerning affiliate company transactions, including compliance with the affiliate standards approved in Cause No. 42873, such as the training and controls that DEI has in place to prevent affiliate cross-subsidization. Schumaker & Company consultants focused on key areas and associated deliverables while allowing for more in-depth analysis of those areas that held opportunity for improvements.

Duke Energy Ohio, Inc.
Cincinnati, Ohio

Assisted the Public Utilities Commission of Ohio (PUCO) staff in a management/performance and financial audit of the fuel and purchased power and system reliability tracker riders of Duke Energy Ohio, Inc. Specifically, conducted an audit of the company’s fuel costs (including any renewable energy costs) plus an audit of system reliability costs. This audit addressed the management/performance and financial aspects of the recovery mechanism. It consisted of a three-year audit cycle (2009-2011) with a complete and thorough audit being conducted in each year of the audit cycle. The initial audit included the actual cost for Rider PTC-FPP for the months January 2009 through December 2009.

Equitable Gas Company
Pittsburgh, Pennsylvania

Assisted the Pennsylvania Public Utility Commission (PaPUC) in performing a stratified management and operations audit of Equitable Gas Company (EGC), a subsidiary of EQT Corporation, and EGC’s relationship with its affiliates. The primary focus of this management and operations audit was the business components of EGC that are still subject to regulation by the Pennsylvania Public Utility Commission. Specifically, we addressed EGC service delivery and production, whose costs are borne ultimately by Pennsylvania ratepayers. The objectives included the determination of what improvements, if any, could be accomplished in the management and operations of EGC pursuant to Section 522(b) of the Public Utility Code 66 Pa. C.S. §522(b). Specifically, Schumaker & Company looked for economies, efficiencies, or improvements that benefit EGC and its ratepayers. In doing so, Schumaker & Company identified which, if any, economically practical opportunities for cost-saving measures and/or better service could be instituted.

General Waterworks Corporation of Pine Bluff
Pine Bluff, Arkansas

Performed a management and operations review, including a review of affiliated relationships and transactions. At the request of the Arkansas Public Service Commission, our final report was submitted as testimony in a general rate hearing of General Waterworks Corporation of Pine Bluff.

Hillsdale Utilities Department
Hillsdale, Michigan

Developed a strategic plan that included a mission statement; identified the organization’s strengths, weaknesses, opportunities, and threats; and formulated long-term goals and objectives.

Illinois Commerce Commission
Springfield, Illinois


Designed survey to measure customer satisfaction with electric service reliability and quality, clarity of billing, rates, and services. Provided Electric Service Customer Satisfaction Survey Guide to instruct electric service providers to administer the survey and to understand, interpret, and present its results. Conducted workshops to train electric service providers to implement the customer satisfaction survey.

Kentucky-American Water Company
Lexington, Kentucky


Performed a comprehensive management and operations review involving executive management, corporate planning, operations planning, engineering and construction, transmission and distribution, treatment and pumping, financial systems, customer service and marketing, human resource management, support functions, and comparative analysis. This project also included a review of Kentucky-American’s relationships and transactions with its parent company (American Water Works Company) and other affiliate companies (primarily American Water Works Service Company).

Kingsport Power Company
Kingsport, Tennessee

Performed a comprehensive management audit of this American Electric Power (AEP) operating company. The audit included evaluations of customer service, electric operations, and many of the administrative, financial, and technology support activities provided by AEP Service Corporation. Examined the methods used by AEP Service Corporation and Appalachian Power Company (another AEP operating company) for billing for services provided to Kingsport Power Company.

Massachusetts Electric Company/Nantucket Electric Company d/b/a National Grid,
NSTAR Electric Company (NSTAR),
Western Massachusetts Electric Company (WMECo)
Boston, Massachusetts

Provided the Commonwealth of Massachusetts, Department of Public Utilities (DPU) staff on three DPU adjudications investigating the emergency preparation and restoration of service following storms by the electric distribution utilities in Massachusetts. Our inquiry in these matters focused on the companies’ compliance with the DPU’s performance standards for emergency preparedness and restoration of service, including preparation for and management of the restoration efforts with respect to Tropical Storm Irene and/or the October 2011 Snowstorm, allocation of company resources in the affected communities, communications with state, municipal, and public safety officials and with the DPU, dissemination of timely information to the public, and identification of company practices that require improvement, if any.

Michigan Public Service Commission
Lansing
, Michigan

Retained for three years by the Michigan Public Service Commission in their efforts to annually verify that the requirements of Section 11, Act No 286, Public Acts of 2008, are being satisfied for each electric utility.  We will verify that these requirements are being satisfied by the Commission beginning with rate case orders issued after January 1, 2009.

Michigan South Central Power Agency
Litchfield, Michigan


Assisted in developing a strategic plan for this power agency, owned by five Michigan municipalities: Coldwater, Clinton, Hillsdale, Marshall, and Union City. The plan addressed the changes within the electric utility industry and the competitive threats felt by the agency. Performed a competitive assessment and benchmarking of the power agency and surveyed customer attitudes (mail survey to residential and non-residential customers) to identify issues for the strategic plan.

Michigan South Central Power Agency
Litchfield, Michigan


Developed and implemented a relationship development (key accounts) program aimed at the larger commercial and industrial customers. Developed an ongoing communication/public relations program for the agencies, councils, and member communities. Follow-up assignments have been subsequently performed.

Middleborough Gas & Electric Department
Middleborough, Massachusetts


Performed a competitive assessment of the operations of this municipal gas and electric department, which included a management audit of all functional areas, benchmarking of major performance indicators in relation to other Massachusetts municipalities, and the best practices of other public and investor-owned utilities. Subsequently Schumaker & Company has been providing strategic planning and information technology assessment and planning services to this organization.

National Fuel Gas Distribution Corporation
Williamsville, New York


Assisted the New York State Department of Public Service (NYSDPS) in a comprehensive management audit of National Fuel Gas Distribution Corporation (NFGDC). The primary focus was the business components of NFGDC’s New York gas business with an emphasis on NFGDC’s effectiveness in meeting its performance goals and the extent to which there are opportunities for improvement. The objectives included determination of possible improvements for management and operations in areas such as corporate mission, objectives, goals and planning; affiliate relationships and transactions; load forecasting; supply procurement; system planning ; capital and O&M budgeting; program and project planning and management; work force management; and performance and results measurement. This audit consisted of a three-step study process, including a diagnostic review that assessed the condition of each functional area or business unit against evaluative criteria or expected business practice and an in-depth analysis of pre-identified areas or issues.

New Jersey Board of Public Utilities
New Jersey Central Power & Light
Newark, New Jersey

Conducted a two phase audit initiated by the State of New Jersey Board of Public Utilities.  Phase 1 consisted of an audit of the affiliated transactions between Jersey Central Power & Light Company (JCP&L) and its affiliates, and Phase 2 was a comprehensive management audit of JCP&L.


New Jersey Board of Public Utilities
Elizabethtown Gas Company (NUI Corporation)
New Jersey Natural Gas Company (New Jersey Resources Corporation)
South Jersey Gas Company (South Jersey Industries Corporation)
Newark, New Jersey

Conducted compliance audits of the competitive services of New Jersey's gas utilities, specifically South Jersey Gas Company (South Jersey Industries Corporation), New Jersey Natural Gas Company (New Jersey Resources Corporation), and Elizabethtown Gas Company (NUI Corporation), as a part of utility industry restructuring in New Jersey.  The purpose was to ensure that the utilities or their related competitive business segments do not have an unfair competitive advantage over other, non-affiliated purveyors of competitive services, and to evaluate and review the allocation of costs between the utilities' competitive and non-competitive services.  We offered our expert opinion, based on appropriate methodology, as to whether there was strict separation and allocation of each utility's revenues, costs, assets, risks, and functions between the utility's electric and/or gas distribution operations and its related competitive business segments.  The audits determined whether there was (1) cross subsidization between utility and non-utility segments within a public utility or holding company; (2) whether the separation of utility and non-utility organizations was reasonable based on the New Jersey Board of Public Utilities (BPU) affiliate relation and fair competition standards; (3) the effect on ratepayers of the use of utility assets in the provision of non-safety-related competitive services; (4) the effect on utility workers; (5) the effect of utility practices on the market for such services; and (6) ensured compliance with New Jersey legislation.


New Jersey Board of Public Utilities

Public Service Electric & Gas Company
Conectiv
GPU Energy
Rockland Electric Company
Newark, New Jersey

Assisted New Jersey Board of Public Utilities (BPU) staff in reviewing and monitoring the implementation of recommendations resulting from an investigation of system reliability for New Jersey's electric utilities.  Assisted Board staff in the review and investigation of the information supplied by each of New Jersey's four electric utilities -- Conectiv, GPUE, Public Service Electric & Gas Company, and Rockland Electric Company -- in connection with the implementation of the selected recommendations as ordered by the Board.  Particular emphasis was placed on each utility's activities to improve and/or maintain CAIDI and SAIDI indicators at acceptable levels; in particular, issues regarding utilities work force management and construction program planning were addressed.  Additionally, assessments were performed of each utility's electric system, distribution system planning and engineering practices, load flow analysis, transmission and substation maintenance practices and procedures, and adequacy of lightning protections.  The review of the implementation assisted the Board in fulfilling its obligation to assure that, notwithstanding the changes occurring in the electric industry, ratepayers are provided reliable, safe and adequate electric service now and in the future.


New Mexico Public Regulation Commission
El Paso Electric Company
Albuquerque
, New Mexico


Assisted the New Mexico Public Regulation Commission (NMPRC) staff in a prudence review and audit of the fuel and purchased power cost adjustment clause ("fuel clause") and related documentation of the electric business operations of El Paso Electric Company (EPE).  In specific, Schumaker & Company assisted the New Mexico Public Regulation Commission staff in providing professional auditing and prudence review services of EPE's fuel and purchased power costs, fuel clause filings and related documentation for the period of January 1, 2010 through December 31, 2011.

New Mexico Public Regulation Commission
Public Service Company of New Mexico
Albuquerque
, New Mexico


Assisted the New Mexico Public Regulation Commission (NMPRC) staff in a prudence review and audit of the fuel and purchased power cost adjustment clause (“fuel clause”) and related documentation of the electric business operations of Public Service Company of New Mexico (PNM). In specific, to provide professional auditing and prudence review services of PNM’s fuel and purchased power costs, fuel clause filings and related documentation for the period of June 1, 2008 through May 31, 2009.

Nova Scotia Power Incorporated (NSPI)
Halifax, Nova Scotia

Assisted in undertaking an audit to examine the solid fuel inventory management function and provide meaningful recommendations for improvement. The review addressed adherence to good utility practice and consistency with the policies and procedures governing fuel management as described in the NSPI Fuel Manual. The scope of the audit included testing the assertions of existence and valuation and an examination of access control for NSPI’s coal inventory. The process audited spanned the receipt of the physical inventory through to financial reporting, with a particular focus on adjustments and/or discrepancies between the physical inventory and the inventory records.

Ohio Power Company Columbus Southern Power Company
Columbus, Ohio

Reviewed the fuel-related practices and procedures for two consecutive years, including overall organizational structure, management decision processes, and the computer information systems supporting these activities. Provided testimony on our findings and conclusions.

Pacific Gas & Electric Company
San Francisco, California


Performed a compliance audit of the costs of PG&E’s gas pipeline expansion project to determine if the appropriate level of incremental A&G and O&M costs were charged to the project before and after commercial operation in November, 1993. We also provided data needed to forecast the incremental operating costs of expanding interstate and intrastate pipeline operations serving California markets. Reviewed PG&E’s integrated pipeline operations that supply natural gas from Canada to California for retail customers, pipeline shippers, and interruptible customers. Our review showed that the intended project costing had been properly implemented, ensuring an equitable distribution of costs between regulated retail customers and unregulated project shippers.

PECO Energy Company
Harrisburg, Pennsylvania

Assisted the Pennsylvania Public Utility Commission (PUC) staff in a stratified management and operations audit of PECO Energy Company. The first phase was a diagnostic review assessing the condition of each functional area or business unit against evaluative criteria or expected business practice. While this review was primarily limited to determining if appropriate management controls, systems and processes are in place, it was of sufficient scope to identify significant problems, if any, requiring additional focused analysis. The second phase was an in-depth analysis of pre-identified areas or issues.

Pennsylvania-American Water Company
Harrisburg, Pennsylvania

Assisted the Pennsylvania Public Utility Commission (PUC) staff in a stratified management and operations audit of Pennsylvania American Water Company. Specifically, the intention of the diagnostic review was to encourage economies, efficiencies or improvements which benefit the utility and its ratepayers and identify which, if any, cost saving measures can be instituted. The ultimate purpose is to explore economically practical opportunities for giving ratepayers lower rates and/or better service.

Pennsylvania Gas & Water Company
Wilkes-Barre, Pennsylvania

Reviewed PG&W gas operations; cash flow statements; dividends paid to PG&W’s parent company (Pennsylvania Enterprises, Inc.); allocation of fees (affiliated relationships and transactions with affiliated companies); management information systems; data processing; staffing and compensation levels; and recruiting, hiring, and promotion. Schumaker & Company was a subcontractor on this assignment.

Pennsylvania Power & Light Company
Allentown, Pennsylvania

Performed a stratified management review, beginning with an initial diagnostic review of all functional areas in the PP&L organization. This was followed by in-depth investigation of 23 issues pre-identified by the PAPUC and PP&L, including affirmative action/EEO programs; salaries, wages, and benefits; staffing plans and levels; corporate-wide information technology; nuclear de-commissioning; power plant materials management; a competitive assessment of in-house construction and maintenance workforces. For example, we found that PP&L had been unable to achieve its objectives for improving its information technology (IT) and systems. In the corporate-wide technology area, 18 major recommendations were made, including detailed steps necessary for bringing technology up-to-date. PP&L accepted 153 of 156 recommendations and within a month implemented 30 and expected to complete another 50 within six months. Total estimated savings and/or increased efficiency associated with our recommendations exceeded $70 million (annually) and $40 million (one-time).

Peoples Natural Gas Company
Pittsburgh, Pennsylvania

Reviewed all areas of this gas distribution company’s operations, including gas supply, gas operations, finance and accounting, marketing, data processing, and materials management. Made over 100 recommendations for improvement. Schumaker & Company was a subcontractor on this assignment.

Philadelphia Gas Works
Harrisburg, Pennsylvania

Assisted the Pennsylvania Public Utility Commission (PaPUC) in performing a  stratified management and operations audit of Philadelphia Gas Works (PGW). The primary focus of this management and operations audit was to review those PGW business components subject to regulation by the PaPUC, specifically PGW service delivery and production, whose costs are borne ultimately by Pennsylvania ratepayers. The objectives included determination of what improvements, if any, could be accomplished in the management and operations of PGW pursuant to Section 522(b) of the Public Utility Code 66 Ps. C.S. §522(b). Specifically, Schumaker & Company looked for economies, efficiencies, or improvements which benefit PGW and its ratepayers.

Philadelphia Gas Works
Philadelphia, Pennsylvania


Reviewed all areas of this company’s operations, including organization structure and planning (corporate policy, philosophy, and strategic planning; corporate and operations planning; organizational structure, authority and responsibility; human resources; capital program planning; gas operations organization and work-management effectiveness); systems supply; finance and accounting; procurement of outside services and non-fuel commodities; support functions; and quality of service (corporate mission, customer billing, meter reading, customer dispute process, office operations, energy theft, and customer relations).

Philadelphia Gas Works
Philadelphia, Pennsylvania

Performed a follow-up review two years after a management and operations audit that involved reviewing results of additional studies recommended during the management audit. Developed a request for proposal for long-term strategic options.

Philadelphia Suburban Water Company
Philadelphia, Pennsylvania


Performed a comprehensive management review involving all company functions. Specific emphasis was placed on staffing and compensation levels, management information systems, allocation of fees from affiliated companies, customer services, engineering and construction, operations and maintenance, water purchase agreements, and capacity planning. This project also included PSW’s relationships and transactions with its parent company and other affiliate companies.

Public Service Electric and Gas Corporation
Newark, New Jersey


Assisted in preparing a long-range strategic generation plan. Assessed PSE&G’s computer information systems for generation planning and scenario analysis. Reviewed selected scenarios for political and qualitative considerations and prepared a comprehensive presentation for senior management.

South Carolina Office of Regulatory Staff
Columbia, South Carolina


Assisted the South Carolina Office of Regulatory Staff (SOR) staff to conduct a management audit of Water Services Corporation (WSC) with regard to five subsidiary water and wastewater companies operating in South Carolina with a focus on the following three areas: 1) basic corporate decision-making; 2) major operational activities; and 3) staff functions. The final report consisted of audit findings and management recommendations. A cost/benefit analysis accompany each recommendation.  The bottom line of this project focused on the determination of whether rates charged to the South Carolina ratepayers could be reduced through the implementation of greater efficiencies in organizations, operations, or both.  Significant consideration was given to the investigation and quantification of potential benefits that would result from a consolidation or merger of the affiliated companies of WSC.

State of Maine Public Advocate
Augusta, Maine

Provided regulatory and litigation support to the Maine Public Advocate regarding Central Maine Power Company’s (CMP’s) credit and collection policies and standard offer uncollectible balances (Docket No. 2010-327). The Maine Public Utilities Commission (MPUC) staff has made a preliminary determination that CMP’s actions led to a significant increase in its uncollectible balances and that some of its actions were imprudent. Specifically, the Public Advocate required expert consulting services to assist his staff in 1) evaluating the questions presented by the MPUC’s notice of investigation and the staff bench analysis in this proceeding; 2) evaluating CMP’s response to a bench analysis filed on June 24, 2011; and 3) presenting evidence and recommendations before the MPUC and/or advice to the Public Advocate regarding these questions.

State of Maine Public Advocate
Augusta, Maine

Contracted to provide regulatory and litigation support to the State of Maine Public Advocate in its intervention in a petition filed on March 18, 2010 at the Maine Public Utilities Commission by Bangor Hydro-Electric Power Company, Maine Public Service Company, Maine Electric Power Company, Inc., and Chester SVC Partnership requesting an approval of reorganization (35-A M.R.S.A. §§708 and 1103) financial provisions.

Tennessee-American Water Company
Chattanooga, Tennessee


Schumaker & Company and its subcontractor Work & Greer, PC (Work & Greer), a certified public accounting firm, conducted an affiliate audit of Tennessee-American Water Company (TAWC) at the request of the Tennessee Regulatory Authority (TRA). The audit included an investigation and assessment of the American Water Works Service Company management performance and decisions relating to internal processes and internal controls involving affiliate relationships and transactions, and the resulting recommendations of any management process changes needed for those controls and implementation. Further, the audit evaluated the charges allocated to TAWC, including the efficiency of processes and/or functions performed on behalf of TAWC, as well as the accuracy and reasonableness of the allocation factors utilized.


Toledo Edison Company
Cleveland Electric Illuminating Company
Columbus, Ohio


Investigated the fuel procurement policies and procedures for fossil and nuclear fuels and provided testimony on the findings and conclusions.


Union Light, Heat and Power Company
Cincinnati, Ohio


Performed a management and operations review of ULH&P, a subsidiary of Cincinnati Gas and Electric Company. Because ULH&P and CG&E are essentially run as a single company, our review covered all areas of both operations, including management and organization, electric operations (excluding power production and fuels management), gas supply and operations, customer services, financial management, human resources, marketing and external relations, and corporate services. We also reviewed ULH&P’s relationships and transactions with its parent company and other affiliate companies.

United Water New Jersey
Harrington Park, New Jersey

Analyzed financial management, information technology and other support services, customer services, and human resources in this comprehensive management audit. Schumaker & Company was a subcontractor on this assignment.

Utilities, Inc. / Twin Lakes
Northbrook, Illinois

Provided a management and operations audit of Twin Lakes utility organization and its affiliate, Water Service Corporation (WSC), on behalf of the Indiana Utility Regulatory Commission (IURC), including operations, customer service/support units, and financial management. The study was organized into three task areas. The first task area was a detailed analysis of the financial management of Twin Lakes Utilities. The second task area was examinations of the water and wastewater utility operations, workforce, and service levels. The third task area comprised key Utilities, Inc. units that support Twin Lakes Utilities, including customer service operations, and included an examination of their operations, workforce, and contribution to the mission of the utilities.

West Texas Utilities Company
Abilene, Texas

Performed a comprehensive management and operations review of this wholly-owned subsidiary of Central and South West Corporation, a registered public utility holding company. Our review included assessments of all functional areas within WTU, and of WTU’s relationships and transactions with its parent and other affiliate companies. We identified ways to save over $2.5 million annually. All 85 recommendations were accepted.

Western Kentucky Gas Company
Owensboro, Kentucky


Performed a management and operations review that covered all areas of this gas company’s operations: management and organization, gas supply and operations, customer services, financial management, human resources, marketing and external relations, and corporate services. Also reviewed WKG’s relationships and transactions with its parent company (Atmos Energy Corporation) and other Atmos affiliate companies in Louisiana and West Texas. (WKG’s service territory is essentially a rural area with many smaller communities in Kentucky.) This project was particularly successful in that the results of the study were presented by all three participants – specifically, the WKG president, a Kentucky Public Service Commission representative, and Schumaker & Company’s engagement manager – before the Subcommittee on Management Analysis during the NARUC Summer Meeting.

Water Services Corporation
West Columbia, South Carolina
Northbrook, Illinois


Assisted the South Carolina Office of Regulatory Staff (SOR) staff to conduct a management audit of Water Services Corporation (WSC) with regard to five subsidiary water and wastewater companies operating in South Carolina with a focus on the following three areas: 1) basic corporate decision-making; 2) major operational activities; and 3) staff functions. The final report consisted of audit findings and management recommendations. A cost/benefit analysis accompanied each recommendation. The bottom line of this project focused on WSC was to determine whether the rates charged to the South Carolina ratepayers could be reduced through the implementation of greater efficiencies in organizations, operations, or both. Additionally, another relevant analysis was the determination of whether the ratepayers of South Carolina were being properly and economically served by the range of corporate services provided to the WSC operations in South Carolina by the managers located in both West Columbia and Northbrook. Significant consideration was given to the investigation and quantification of potential benefits that would result from the consolidation or merger of the affiliated companies of WSC.


 Telecommunications Assignments


ALLTEL Pennsylvania
Kittanning, Pennsylvania


Performed a stratified management and operations review focusing on functions and activities performed by ALLTEL Pennsylvania, its associated companies (ALLTEL Telephone Service Corporation, ALLTEL Corporate Services, ALLTEL Supply, ALLTEL Publishing), and its parent company (ALLTEL Corporation). As requested, we also reviewed staffing plans and levels; affiliated relationships and transactions with other ALLTEL companies; and diversity/EEO. Services provided primarily by affiliated companies are administrative, technology, and procurement functions and activities.


Commonwealth Telephone Company
Dallas, Pennsylvania


Performed a stratified management audit involving a diagnostic review of all company operations, followed by an in-depth review of nine pre-identified issues and an in-depth investigation of any problematic areas identified in the diagnostic phase.


Illinois Bell Telephone Company
Chicago, Illinois


Performed a focused review of affiliate relationships between IBT and its affiliates: Ameritech Corporate, Ameritech Services, Inc., Ameritech Information Systems, Inc., and Bell Communications Research, Inc. (Bellcore). Involved a comprehensive review of all activities by these affiliates, focused on the cost assessment, value assessment, and impact assessment of these relationships on Illinois ratepayers, as well as an assessment of IBT’s billings to its various affiliates. Testified before the ICC on our findings and conclusions. Schumaker & Company was a subcontractor on this assignment.


Indiana Utility Regulatory Commission,
SBC Ameritech Indiana and Other Settling Parties
Indianapolis, Indiana


Performed a service quality performance review of SBC Ameritech Indiana after it experienced significant service quality performance problems during the year 2000, especially as related to service provision to residential and small business customers. These problems prompted an investigation by the Indiana Utility Regulatory Commission and other parties, including the Indiana Office of Utility Consumer Counsel, Citizen’s Action Coalition of Indiana, Inc., United Senior Action of Indiana, Inc., and the AARP (collectively referred to as the Settling Parties), which resulted in this review. Analyzed, documented, and verified, through findings based on identifiable and measurable information and data, that Ameritech Indiana’s existing service quality plans and practices ensure that out-of-service repairs, new installations of primary service, repair center speed of answer, and business office speed of answer meet applicable service quality performance standards, including reasonably foreseeable events and contingencies. Developed and documented recommendations to improve or modify these service quality practices and/or plans where existing plans and practices were not sufficient to ensure that applicable standards were met.


New England Telephone Company
Boston, Massachusetts


Performed a focused management review of New England Telephone’s affiliate transactions, including 10 to 12 different entities that account for almost $1 billion annually. Several of NET’s support functions (information systems, methods and procedures, purchasing and materials management, legal, and others) were being provided through affiliated companies. Other products and services also were provided by affiliates, including research and development activities. Our review examined the affiliate service cost structure to pinpoint areas for potential cost savings. The Department of Public Utilities and NET accepted all of our 43 recommendations. One recommendation led NET to establish a revised mechanism for reporting to each of the state commissions within the five-state region.


U S WEST
14 Western States


Conducted regulatory impact reviews of two affiliate companies of U S WEST. These studies, performed from a regulatory perspective, examined the effect on rates and ratepayers of the operations and allocations from both companies in each of the 14 states affected by these operations. Addressed various aspects of the affiliated relationships and transactions between two unregulated U S WEST affiliates – U S WEST, Inc. and Advanced Technologies, Inc. – and the effect of these transactions on U S WEST Communications ratepayers. Developed a computerized regulatory impact model for use by the project team and the 14 states in analyzing the impact from modifying methodologies used.

Verizon New York
New York, New York


Schumaker & Company held Project Manager, Lead Consultant, and Senior Consultant positions to perform a review and evaluation of Verizon NY’s efforts to provide retail service quality that consistently met the requirements of the New York telephone service standards, as required by the New York Public Service Commission (PSC).

Analyzed, documented, and verified, through findings based on identifiable and measurable information and data, to ensure that Verizon NY’s existing service quality plans and practices of the five VIP service objectives (customer trouble report rate, percent out of service over 24 hours, percent installation completed in five days, PSC complaints, and outliers), NY Telephone Service Standards, and company guidelines meet applicable service quality performance standards, including reasonably foreseeable events and contingencies. Developed and documented recommendations to improve or modify these service quality practices and/or plans where existing plans and practices were not sufficient to ensure that applicable standards were met.


Verizon Pennsylvania
Philadelphia, Pennsylvania


Performed a review and evaluation of Verizon PA’s performance metrics and related remedies, as required by the Pennsylvania Public Utility Commission (PAPUC).

Reviewed Verizon PA’s processes for performance metric development (pre-ordering, ordering, provisioning, maintenance/repair, network performance, billing, operator services, and general standards) from source system inputs (including operational support systems and manual data input) to the data mart, where performance reporting occurred. Examined the utility’s underlying information and operations support systems that provided data for use in calculating the performance metrics and remedies.


State and Local Government


Ann Arbor Housing Commission
Ann Arbor, Michigan

Provided services to assist the Ann Arbor Housing Commission (AAHC) in an operational assessment with an emphasis on financial decisions involving the organization. Specifically, Schumaker & Company performed three key assessments: 1) a high-level analysis of the existing organization structure of services involving major areas of AAHC operations; 2) an evaluation of the present staffing structure for appropriateness, effectiveness, and efficiency of operations; and 3) an assessment of department processes for improved effectiveness and efficiencies with a goal to create an organizational climate of empowerment and accountability. Schumaker & Company identified potential organizational, staffing, and business process changes for consideration by AAHC management. A five-year strategic plan was addressed and a final report written.


City of Dearborn
Dearborn, Michigan

Assisted the City of Dearborn in streamlining and consolidating its operations, eliminating non-essential services, and optimizing its overall level of resources involved in achieving goals. Schumaker & Company performed an operations review and assessment of Camp Dearborn that focused on reviewing all key positions (full-time and part-time) through job descriptions, chain of command analysis, and interviews with Camp Dearborn and Recreation Administration staff, evaluating the adequacy of current staffing levels in terms of ability to deliver needed services, reviewing operating revenues and expenditures and business policies and guidelines, conducting a benchmark review of Camp Dearborn with venues similar in size, capacity, and recreational opportunities, and more.


City of Detroit
Detroit, Michigan

Recommended cost reduction planning and potential revenue enhancement initiatives based on process mapping and analysis of key processes for designated departments. These plans/initiatives address risks associated with implementation, not only within the designated departments, but especially its potential impact on the delivery of services to the residents and surrounding communities.

Schumaker & Company conducted on-site analysis using interviews, process team meetings, and other research methods of the least intrusive means possible.


State of Michigan Department of Community Health
Lansing, Michigan


Provided quality assurance (QA) and project planning services to the Michigan Department of Community Health (MDCH), as MDCH management located a vendor who could provide Pharmacy Benefits Management services, including claims administration and operations of a point-of-sale (POS) system, clinical consultation programs, and disease state management programs for the State’s Medicaid fee-for-service (FFS), Children’s Special Health Care Services (CSHCS), Refugee Assistance Services (RAS), and State Medical Program (SMP) beneficiaries. Then, following contract award, to monitor implementation activities. Major steps include:
  • Project planning, schedule development and monitoring
  • RFP analysis & development
  • RFP evaluation, including assessment of bid responses, provision of counsel and advice to joint evaluation committee members, and appeal justification
  • Implementation (project initiation, requirements definition, systems analysis/general design, technical design, development, and operations)


State of Michigan Department of Community Health Medicaid Services Administration
Lansing, Michigan


Assisted program staff by developing a RFP for Executive Information System (EIS) and Decision Support System (DSS) to analyze and report managed care data on the State’s data warehouse. Helped through initial phases of procurement process.


State of Michigan Department of Community Health Medicaid Services Administration
Lansing, Michigan


Assisted work group in identifying, reporting, and monitoring issues associated with transition of the Medicaid eligibility determination processing to Family Independence Agency staff.


State of Michigan Department of Community Health
Lansing, Michigan


Provided project management services to the Michigan Department of Community Health (MDCH), as MDCH located a vendor who could provide enrollment/eligibility, pharmacy benefits management services (including claims administration and operations of a point-of-sale (POS) system), and clinical management programs for the State's Elder Prescription Insurance Coverage (EPIC) beneficiaries.  Then, following contract award to the vendor, our firm managed implementation activities.


State of Michigan Department of Agriculture
Lansing, Michigan


Performed a needs assessment and requirements definition, specification, and design of an administrative support information system. The system served the accounting analysis, budget monitoring and tracking, and personnel analysis areas, and a horse breeders’ award program.


State of Michigan Department of Environmental Quality
Lansing, Michigan


Reengineered Department of Environmental Quality’s records management and implemented a pilot electronic document management system (EDMS) in the Storage Tank and Environmental Response divisions. Reviewed and documented existing business processes for re-engineering with EDMS. Created file list, file structure and indexing for database of files; established processes and priorities for back file conversion; and established processes for electronic imaging of records going forward.


State of Michigan Department of Treasury, Department of Management & Budget, and Family Independence Agency
Lansing, Michigan


Performed a study of the existing work processes for printing and disbursing State of Michigan warrants, resulting in the following: 1) review and assessment of the current situation and existing policy, processes, and procedures, 2) findings, conclusions and recommendations, including identification of alternative technologies for enhancing quality, controls, and efficiency of operations, 3)  surveys of other organizations, 4) alternatives analysis, 5) alternatives cost analysis, and 6)  implementation strategy and plan.


State of Michigan Consumer & Industry Services Insurance Bureau
Lansing, Michigan


Studied and documented the work flows, office space design, policies, procedures, regulations and laws, manual and computer systems, telephone systems, and processes used by the Consumer Assistance Section (CAS) and also interactions with other Bureau organizations. Based on the results of this extensive study and benchmark research into other similar customer service/help desk operations, recommended ways to improve the effectiveness and efficiency of CAS operations and also develop performance measures for highlighting changes in operations.


State of Michigan Department of Management and Budget
Lansing, Michigan


Assisted the Michigan Administrative Information Network (MAIN) organization in its strategic planning activities, including identifying its customers and their needs, and developing its purpose, mission, goals, and objectives.


Michigan State Hospital Finance Authority
Lansing, Michigan


Assisted the Michigan State Hospital Finance Authority in its strategic planning activities, including developing its purpose, mission, goals, and objectives.


State of Michigan Department of Labor
Lansing, Michigan


Performed an organizational structure and management review of the Bureau of Departmental Services within the Department of Labor to identify inefficiencies and redundancies within the work flows between the Office of Budget, Finance, and Administrative Services and the Office of Technology and Information Systems. We also made numerous recommendations for streamlining operations. During a follow-up project, we developed a framework for implementing bureau-wide procedures.


State of Michigan Department of Labor Business Enterprise Program
Lansing, Michigan


Performed a financial compliance review of the operations for a random sample of participants in the Business Enterprise Program (BEP). Identified problems in the financial reporting procedures and provided recommendations for improvement. We interviewed participants, examined their financial records, and drew conclusions about the program from the resulting database.


State of Michigan Department of Corrections
Lansing, Michigan


Performed an organizational structure and management review of the Michigan State Industries (MSI) program, and assisted with its strategic planning. The MSI program encompassed a central office in Lansing, Michigan, three regional offices, and 32 factories at 20 prisons throughout Michigan’s lower and upper peninsulas. In mid-1992, MSI employed 172 civilian employees (124 at factory locations) and 1,152 prisoners. The products manufactured by MSI included wood and metal furniture, shoes, vinyl, textiles, cartons, motor vehicle license plates and tabs, highway signs, mattresses, garments, paints and janitorial supplies, brushes and brooms, lumber, and farm products. The services provided include laundry, machine shop and industrial maintenance, and data processing. As a result of our review, substantial modifications occurred, including a structural reorganization. Additional follow-up work occurred to assess and evaluate selected factories.


State of Michigan
Michigan State Police
Lansing, Michigan

Assisted Michigan State Police (MSP) in developing an objective needs assessment and an overall financial disbursement strategy for the specific monies collected under the authority of Public Act 78 of 1999, Section 409(E), specifically the Wireless E911 $.03 Priority Fund, whose monies were collected over a two-year timeframe.  Assisted in developing a strategy for the disbursement of these monies to provide appropriate funding for identified and needed services, initiatives, and products; developed criteria for selection and evaluated proposals from the public safety answer point (PSAP) community for disbursement of funds; and recommended proposals for consideration by the Michigan Legislature.


State of Michigan Office of Financial and Insurance Services
Lansing, Michigan

Conducted an assessment of the operational and managerial aspects of the Office of General Counsel for the Office of Financial and Insurance Services (OFIS).  Interviews conducted with key management personnel for on-site analysis consisted of reviews of the organization and chief processes for which each key person was responsible, as well as discussions of any areas of particular interest.  A well balanced report that reflected both areas which hold opportunity for operational and financial improvement and those areas which demonstrate exemplary management and operation effectiveness was written and delivered.


State of Michigan Office of Financial and Insurance Services
Lansing, Michigan

Provided services to assist in an independent program assessment of the State of Michigan, Office of Financial and Insurance Regulation (OFIR), Mortgage Examination and Investigation Section.  Schumaker & Company provided research to identify and describe characteristics of six state mortgage regulatory programs and assessed current complaint-based approaches versus routine examination approach on 36/48 month cycle.  We identified quantitative data to be captured and developed a tool for OFIR to process the data for measuring the impact of additional staffing in reducing predatory lending practices and recommended action plans to implement given those findings.


Town of Hilton Head Island
Hilton Head
, South Carolina

Provided services related to an assessment of the Town of Hilton Head Island’s (Town) current business processes, organization structure, staffing levels, and software that support the management of the Town’s employee information. This study evaluated the performance of the subject organization, staffing, operations, and costs with the intended final result of identifying opportunities for improving/revising/ replacing the processes, organization structure, staffing levels, and software.  Using the least intrusive means possible, an on-site analysis was performed concluding with the delivery of an oral presentation summarizing the findings to that time. Subsequently, produced a detailed draft organizational review report that was presented to the Town Board for review.


Wayne County Airport Authority
Detroit, Michigan

Provided services to assist the Wayne County Airport Authority (WCAA) Technology Services Division in identifying technology business initiatives and updating its annual five-year performance plan at the Detroit Metropolitan Wayne County Airport.  This project involved assessing WCAA’s technology and service needs for all 30+ divisions, plus identifying the impact of airport and/or business trends on operations, as a means to identify WCAA’s technology initiatives planned for the next five (5) years.

 


Private Sector Projects


Accuma Corporation
Statesville, North Carolina


Implemented an ERP package for manufacturer of automotive and marine battery casings and components.  The project includes identifying and implementing other business process improvements.  The primary functional areas of attention are the implementation of the ability to schedule the production of the factory under an MRP environment and to implement real time reporting of work order status and scrap production.  Initial process improvement initiatives were improving the scrap reporting process, reducing the amount of scrap produced, improving the accuracy of the bills of materials and routings, and improving the accuracy of inventory transactions and perpetual inventory.  The project team focused on the implementation of an improved ad hoc reporting software package.


Ann Arbor Plastics
Ann Arbor, Michigan


For this Michigan-based manufacturer of plastic display units, Schumaker & Company performed a business process reengineering project to identify potential opportunities for improvements in the flow of information and paperwork in the materials management and order entry/fulfillment processes.  Detailed flowcharts of the two existing business process flows were developed.  Analysis of these flowcharts, in conjunction with company management, revealed numerous potential areas for improvement.  Implementation of these recommendations by company management resulted in significant gains in the efficiency and cost effectiveness of the overall business process.  As a result of this, Schumaker & Company was contracted to assist the company in the identification of an ERP system that would better meet the needs of Ann Arbor Plastics, especially in regard to the ability to support projected future growth.


Applied Dynamics International
Ann Arbor, Michigan


Provided consulting to manufacturing firm by reviewing its efforts to convert all of its computer applications to alternative hardware, resulting in a recommendation that the project scope be expanded and that the following activities be under taken:
  • Review of existing information flow, both manual and automated, for all functional areas
  • Needs assessment for overall organization and individual departments and function
  • Implementation planning, monitoring, and review
  • Modification of manual policies and procedures based on reviewing of existing information system and needs assessment
  • Evaluation and selection of vendors for packages
  • Package installation activities and modification of applications not replaced by packages
  • We also helped with a needs assessment, implementation planning, monitoring, and review, and evaluation and selection of vendors for packages.


High Scope Education Research Foundation
Ypsilanti, Michigan


Provided consulting to non-profit organization by reviewing existing accounting, press fulfillment, workshop/seminar registration, marketing, and professional school credit groups and the systems that support these groups. Investigated possible directions, suggested alternatives for hardware and software, and recommended course of action.


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