Webinar Zero V4
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Transcript of Webinar Zero V4
Zero-Based Golf Course Budgeting:A Model for Increased Effectiveness
Michael Vogt, CGCS, CGIAMichael Vogt, CGCS, CGIABill McMahon, Sr., AIA, OAABill McMahon, Sr., AIA, OAA
May 15, 2009May 15, 2009
April Golf Survey Review
Course distances:Course distances: Range - 6,001 to 7,200 yards.Range - 6,001 to 7,200 yards.
Annual maintenance budgets Annual maintenance budgets for 2009:for 2009: Range - $550,000 to $1,669,000Range - $550,000 to $1,669,000 Average - $1,081,000Average - $1,081,000
Annual rounds played:Annual rounds played: Range – 15,750 to 41,000Range – 15,750 to 41,000 Average – 24,800Average – 24,800
Survey Review
3 clubs report no change 3 clubs report no change in golf rounds played over in golf rounds played over last 2 yearslast 2 years 2 clubs reported rounds 2 clubs reported rounds
down about 12%.down about 12%. Five courses rated Five courses rated
condition – “Best ever condition – “Best ever been”been” 3 courses rated condition – 3 courses rated condition –
“Good”“Good”
Survey Review Biggest challenges being faced:Biggest challenges being faced:
Fuel pricesFuel prices Irrigation costsIrrigation costs WeatherWeather Timing of expenditures for cash flowTiming of expenditures for cash flow Trying to establish maintenance on a national quality Trying to establish maintenance on a national quality
levellevel Selling members/justifying $1 million budgetSelling members/justifying $1 million budget Increasing labor costsIncreasing labor costs
Average percent of labor cost in maintenance Average percent of labor cost in maintenance budget is 41% to 51%.budget is 41% to 51%.
The Golf Course Budget
A golf course budget should A golf course budget should be the numerical expression be the numerical expression of the way the of the way the superintendent manages superintendent manages and accomplishes the goals and accomplishes the goals of the club.of the club. Club goals of quality, Club goals of quality,
environmental impact, amount environmental impact, amount of play, tournament impact, of play, tournament impact, etc.etc.
Dramatically Different Way to Budget
Set of established, consensus-based golf Set of established, consensus-based golf course standards.course standards.
Discover the value of “cycle-times.”Discover the value of “cycle-times.” Base labor on hours needed to accomplish Base labor on hours needed to accomplish
job tasks.job tasks. Plan all routine maintenance activities.Plan all routine maintenance activities.
Benefits of Zero-Based Budgets
1.1. Provides sufficient resources based on standards and Provides sufficient resources based on standards and current needs.current needs.
2.2. Identifies new processes and procedures to accomplish Identifies new processes and procedures to accomplish goals.goals.
3.3. Challenges superintendents to find cost-effective ways to Challenges superintendents to find cost-effective ways to improve operations.improve operations.
4.4. Improves communication between superintendent, Improves communication between superintendent, manager, committees, Board and key staff.manager, committees, Board and key staff.
5.5. Measures key metrics involved in course maintenance.Measures key metrics involved in course maintenance.6.6. Eliminates overinflated budgets.Eliminates overinflated budgets.
Golf Maintenance Standards
A detailed set of course maintenance A detailed set of course maintenance standards must be defined with input from standards must be defined with input from superintendent, committee, general superintendent, committee, general manager and board of directors.manager and board of directors.
Golf Course Standards – Example: Sand Bunkers Sand depth 4 inches minimum, Sand depth 4 inches minimum,
6 inches maximum6 inches maximum Edge cleanly defines hazardEdge cleanly defines hazard Maximum 4 inch, minimum 2 Maximum 4 inch, minimum 2
inch lip in direction of playinch lip in direction of play No edge lip in direction of tee or No edge lip in direction of tee or
perpendicular to direction of perpendicular to direction of playplay
Weed FreeWeed Free
Free of debris (sticks, leaves, Free of debris (sticks, leaves, stones, grass clippings)stones, grass clippings)
Rakes positioned, at minimum, Rakes positioned, at minimum, every 40 feetevery 40 feet
Sand raked every day play is Sand raked every day play is scheduledscheduled
Chemical edging with Primo, Chemical edging with Primo, growth regulator growth regulator
No standing water No standing water
Accomplishing a concise set of standards takes the guess-work out of golf course conditioning and the need for unanticipated resources.
Assembly of Golf Course Budget
Based on predetermined Based on predetermined course maintenance course maintenance standards, labor and standards, labor and purchases can be purchases can be forecasted.forecasted.
Labor, (>40% of total) being Labor, (>40% of total) being the largest portion of the the largest portion of the budget is the starting point budget is the starting point for the formulation of the for the formulation of the Zero – Based Budget.Zero – Based Budget.
Assembly of Budget
Roster of staff persons assembled into workforce Roster of staff persons assembled into workforce pay rate and available hours per day.pay rate and available hours per day.
Hours Available Per Day TOTAL
Sun Mon Tue Wed Thu Fri Sat HRS
Golf Course Supt. 115,000.00 5.00 8.00 8.00 8.00 8.00 8.00 5.00 50.00
Assistant Superintendent 40,000.00 - 8.00 8.00 8.00 4.00 8.00 5.00 41.00
Assistant Superintendent 40,000.00 5.00 8.00 6.00 8.00 4.00 8.00 - 39.00
Golf Course Mechanic 35,000.00 8.00 8.00 8.00 8.00 8.00 - 40.00Foreman 12.50 5.00 8.00 - 8.00 8.00 8.00 - 37.00
Employees Name Rate of Pay
Labor Allocation Example
Assembly of Budget
Cycle-Time tasks per dayCycle-Time tasks per day Full time equivalents per dayFull time equivalents per day Total hours available and needed with deficient or excess per day and Total hours available and needed with deficient or excess per day and
per weekper week
Task Man-Hour Allocation ExampleTask Schedule
Cycle Times
Available Hrs/Day SUN MON TUE WED THU FRI SAT Total FTE69 168 119 160 110.1 160 52 838.1 20.9525
Task SUN MON TUE WED THU FRI SAT TotalGreens Mowing / Rake Greenside Bunkers 12 12 12 12 12 12 72Cups Changed / Set-up / Ball Marks 8 8 8 8 8 8 6Tees Mowed 0 16 16 16 48Greens Approach / Collar Cut 6 6 6 18Fill Water Coolers 2 2 2 2 2 2 12
Managing the Labor Budget
Per week hourly goals managed on a Per week hourly goals managed on a timely basis by the superintendent.timely basis by the superintendent.
Goals ExampleSunrise: 6:34:00 AM
Sunset: 5:56:00 PM
$886.6181.25
84.00
Sun2/22
Full Time Equivalents→ 10
→
Hours Needed (Cycle Times) →
Scheduled Dollars (Hourly Only) →
Scheduled Hours (Hourly Only) →
Drink Coffee
Weekly Hourly Wage Goal
Hours of Daylight:
11:22
$12,567.00 Scheduled Hourly Wages
Schedule for Work Week Starting Sunday:
Sunday, February 22, 2009
Enter any events or significant events for the week here.
Managing the Labor Budget
Hourly scheduling helps to eliminate overtime.Hourly scheduling helps to eliminate overtime.
Hourly Scheduling Example
Managing the Labor Budget
Change schedule as needed to maximize Change schedule as needed to maximize efficiencies and keep overtime to a minimum.efficiencies and keep overtime to a minimum.
Avoiding Overtime Example
Building the Labor Budget
Assign full and part time positions based on ability, pay Assign full and part time positions based on ability, pay scale and hours.scale and hours.
Hourly PositionsFull Time Current Proposed New Hours BudgetedPart Time Rate $ Incrs. Rate Jan
0.00 0Chuck Landon Mechanic Full Time 15.00 0.20 15.20 165Ismael Mendoza Applicator Full Time 12.60 0.15 12.75 165Santiago Paniagua Irrigation Full Time 11.60 11.60 157Felipe Bastida Greens Full Time 10.25 10.25 157Alberto Villafana Greens Full Time 9.25 9.25 157
Employee Name Position
Assigning Staff Persons Example
Building the Labor Budget
Hours are assigned to each member of the staff based on Hours are assigned to each member of the staff based on job tasks needed to maintain club’s quality standards.job tasks needed to maintain club’s quality standards.
Allocating Labor Hours ExampleHours Budgeted
Jan Feb Mar Apr May Jun Jul Aug Sep150 150 150 176 176 176 184 176 176150 150 150 176 176 176 184 176 176150 150 150 176 176 176 184 176 176
100 176 176 184 176 176100 176 176 184 176 176
150 150 150 176 176 176 184 176 17650 100 176 184 176 176
Building the Labor Budget
MonthPayroll Salaries
Payroll Hourly
Overtime Payroll Costs
Benefits Work Comp.
Employee Meals
Incentives & Bonus
401 K Match
Total Payroll
January 20,434$ 21,781$ -$ 5,699$ 3,200$ 870$ 980$ -$ 375$ 53,339$
February 20,434$ 20,261$ -$ 5,494$ 3,200$ 870$ 980$ -$ 375$ 51,614$
March 20,434$ 27,157$ 4,000$ 6,965$ 4,000$ 1,634$ 1,120$ -$ 375$ 65,685$
Allocating Labor Dollars Example
Overtime is assigned as a dollar figure not hours. Overtime is assigned as a dollar figure not hours. Overtime should never be though of as needed, Overtime should never be though of as needed,
expected, entitled or necessary.expected, entitled or necessary.
Other Budgeted Areas Identified
Equipment leasesEquipment leases Repair and Repair and
maintenancemaintenance Supplies and toolsSupplies and tools Uniform and laundryUniform and laundry Travel and Travel and
administrationadministration Special projectsSpecial projects
Budget Analysis
The above shows budget figures compared to The above shows budget figures compared to size of size of coursecourse and and cost per-holecost per-hole. The budget analyses are . The budget analyses are important metrics for comparison in subsequent year important metrics for comparison in subsequent year budgets.budgets.
136,320 56134,560 40
102
Total Water:Total Other Budgeted: Total Power: 35%
Total Budgeted: Total Lease:Total Variable Exp:
$ 936,164 Number of Holes:
Total Payroll Budgeted:
Total Course Acres:
401,625$ 2,364,036$
430,423$
1,810,711$ 2,794,459$
% Payroll / Budget:983,747$
Total Non-Variable:
Acres of Fairways:Acres of Rough:
Total Cost per Hole / Total Budget
Maintenance Cost per Acre / Total Budget
$ 27,338.08
Total Ft² - Greens:
Cost Per 18-Hole Round
114$
Total Full Members
42,500$
Maintenance Cost Per Full Member
4,293$ 77,624$
Total Ft² - Tees:
36651
Water, Power and Lease Expenses
Water, $897,123 , 68%
Power, $42,500 3%
Lease, $392,275 , 29%
Total Payroll and Other Expenses
Payroll Expenses,
$983,747 , 36%Other Expenses, $1,761,725 ,
64%
Zero-Based Budget
In the end a budget is In the end a budget is created based on created based on expectations, needs and expectations, needs and goals, not on history and goals, not on history and inflated line items over a inflated line items over a series of years. series of years.
A true budget / business plan A true budget / business plan is a reflection of the coming is a reflection of the coming years maintenance plan.years maintenance plan.
Managing the Labor Budget
Knowing “Cycle-Times” for routine Knowing “Cycle-Times” for routine tasks is important in formulating tasks is important in formulating labor requirements.labor requirements.
Example
Tasks Total Hours
per Day Sun
Mon Tue
Wed Thu
Fri
sat
Greens Mowing / Ball Mark Repair 24 TRUE ##### TRUE TRUE TRUE TRUE TRUE
Mow Approaches 8 ##### TRUE ##### TRUE ##### TRUE #####
Tees Mowed 5 ##### TRUE ##### TRUE ##### TRUE TRUE
Water Coolers Serviced 4 TRUE ##### TRUE TRUE TRUE TRUE TRUE
Bathrooms Cleaned and Serviced 1.5 TRUE ##### TRUE TRUE TRUE TRUE TRUE
Divots Repaired Par 3's 5 ##### TRUE TRUE TRUE TRUE TRUE #####
Green Valley Turf, Tennis & Golf Club
Task Cycle-Time
Zero-Based Golf Course Budgeting:A Model for Increased Effectiveness
Let Us Help You With Your Golf Course Let Us Help You With Your Golf Course Budgeting ChallengesBudgeting Challenges
Michael Vogt, CGCS, CGIAMichael Vogt, CGCS, CGIABill McMahon, Sr., AIA, OAABill McMahon, Sr., AIA, OAA