Frequently Asked Questions
ENTERPRISE UNITS
What is a Forest Service Enterprise Unit?
The Enterprise Program consists of a number of Enterprise Units (EUs), each composed of one or more Forest Service employees. EUs are flexible organizations that compliment the Agency’s line and staff structure. One way to think of EUs is that they are internal consulting groups. In addition to following all applicable federal laws, rules and regulations, EUs utilize sound business principles to conduct their operations. EUs do not receive any base/appropriated funding, rather, they market their services and products to customers within the Forest Service, or with other government agencies and their partners. An EU charges clients predetermined fees aimed at recovering all direct and indirect costs of doing business.
Who can form an Enterprise Unit and how is it done?
Any Forest Service permanent employee or group of employees may form an Enterprise Unit. EUs should have a sponsor, receive approval for their business plan from the Enterprise Program Steering Committee, and be issued a business license to operate under the Enterprise Program Guidelines.
What is the contractual obligation of the Forest Service to the Enterprise Unit upon the issuance of a business license?
The business license is simply recognition that the EU has an approved business plan. The license is valid as a long as the EU is financially viable and operates within legal and regulatory guidelines.
How can I get the information I need to start an Enterprise Unit?
Enterprise training for prospective units thus far has been formally announced through a memo (current memo: March 6, 2007, file code 1310, which is posted on the EP intranet site) During an Enterprise round, prospective enterprisers can submit a prospectus for a new EU. If the prospectus is accepted, the employee(s) are required to attend entrepreneurial and business plan training session offered by the Enterprise Program Office.
The WO issued a letter soliciting prospectuses for new Enterprise Units on March 6, 2007. The deadline for submissions is June 29, 2007. Contact the Enterprise Program Office (enterprise-program@fs.fed.us) or visit the Enterprise Program’s intranet site for details.
In addition, the EP plans to have short-term training opportunities, for example, an orientation session for employees who are interested in learning more about EUs. Attending one of these orientations could be an employee’s first step to forming an EU or just to learn more about the EP. While not currently available, the plan is to offer such sessions in FY 2008.
BUSINESS PLANS
Why does an Enterprise Unit need a business plan?
In writing the business plan, prospective entrepreneurs analyze the market for their goods and services based on their cost and pricing structure. Upon reviewing the business plan, the sponsor and Enterprise Program Steering Committee will determine whether the EU is viable. The business plan also outlines an exit strategy in the event the EU is not able to achieve its goals.
What amount of change would require re-approval of the business plan of an Enterprise Unit?
Any time and EU makes a substantive change to the direction of an EUs business, the business plan needs to be updated. EUs are encouraged to update their business plans each fiscal year. The Steering Committee will be using the business plan to monitor the financial stability of the EU. The Enterprise Program office utilizes the business plan to monitor EU operations.
FINANCES
How do Enterprise Units obtain and manage their financing?
EUs charge fees that recover the total cost of running the EU, including all development, direct and indirect costs. EUs receive funds through work orders with their customers. Funds received for accomplishments are deposited into the Working Capital Fund (WCF) using an EU’s job codes. Once deposited, these WCF funds, no matter what their source, become zero-year dollars and are used by the EU to complete its work orders and pay for associated operational costs of the EU.
What factors need to be calculated in order to determine full-cost recovery?
EUs are required to be completely self-sustaining and as such must recover their full operating costs. Each EU is taught how to calculate their full costs as part of the Enterprise Training and their estimated costs and charge rates are included in the Business Plan. Once all costs are identified and estimated the costs are spread across the billable time available within the EU to arrive at the hourly actual cost recovery rate. Some EUs charge an hourly rate, others charge by the project or other means. Regardless of the charge method, each EU must be aware of their full costs and hourly cost recovery rates.
Can Enterprise Units make a profit?
EUs do not generate profits per say. Within the regulations governing the WCF, EUs need to be cash positive so as to remain financially viable. The positive cash balance is held in the Enterprise Unit’s business account (a Forest Service Working Capital Fund or “WCF”).
WCF authorities allow cash balances to be carried forward for future needs if revenues exceed expenses. If a unit has a positive cash balance, that positive balance may be used, for example, to offset slow cash-flow periods, for development and marketing of new products, to purchase equipment, or for performance awards.
EUs are encouraged to establish cash balances to hold funds up to 30% (allowable per WCF regulations) of the next year’s estimated expenses or to plan for large or unanticipated expenses such as extended sick leave for an employee.
What happens if an Enterprise Unit has a negative balance?
An EU that carries a negative balance for two or more consecutive quarters would be required to revise their business plan and be placed on a recovery plan until their deficit problem is resolved. If the deficit is not resolved under the recovery plan, then an exit strategy would be implemented in order to return the EU business lead and employees to traditional Forest Service jobs. The EP Steering Committee makes the determination whether or not to disband an EU.
ENTERPRISE EMPLOYEES
Where do Enterprise employees fit in the Forest Service organizationally?
All approved EUs and their employees, regardless of their physical location, are organizationally assigned to the Enterprise Program, under Business Operations in the Washington Office. EU employees retain their civil service status with all the associated rights and benefits.
What are the advantages of an Enterprise Unit to the employee?
Due to the virtual nature of the organization, Enterprise employees can usually live anywhere in the country. Enterprise employees take pride and ownership in their units and projects. Specialists are often able to focus on their area of expertise while serving clients throughout the agency.
After a person retires from the Forest Service, are there any options for coming back to work with an Enterprise Unit?
Yes. Retirees can return to the federal government in a temporary or permanent position. The retiree would be classified as a Reemployed Annuitant. As a general rule, the retirement check (annuity) continues and the amount of this annuity during the period of reemployment will be offset. The retiree will need to complete hiring paperwork and provide evidence of the annual annuity income.
Any employee leaving the government with 3+ years of continuous permanent employment has lifetime reinstatement eligibility. This eligibility allows an individual to be hired noncompetitively into a position at or below the grade level they were upon leaving the federal government.
What happens to employees who are part of an unsuccessful Enterprise Unit or a when a Unit disbands for any reason?
Before any decision to disband an unsuccessful EU, management will explore alternatives such as restructuring, market options and opportunities, modifications to products and/or services offered, to help the EU remain viable.
If these efforts are not successful, and it is determined that the EU must be disbanded, contingency plans allow employees of an unsuccessful or disbanded EU to return to the traditional workforce. The Enterprise Program Office will facilitate reassignment or placement opportunities for employees of the disbanded EU. There is no guarantee, however, that EU employees will be able to return to their previous position.
Employees have the same rights as all other Forest Service employees per the Master Agreement between Forest Service Management and the Union (NFFE). This is outlined in the MOU between the Enterprise Program and NFFE. The MOU is posted on the EP intranet site.
What happens to an EU if the EU business lead retires, leaves for another position or is unable to continue as the business lead permanently or temporarily for some other reason?
As with any other Forest Service unit, an acting EU business lead can be placed temporarily into the position. It would be done by the Enterprise Program Director and last until the business lead returns or is replaced. If the business lead leaves the position, the job would be advertised and filled like any other FS position.
SPONSORS
What is a sponsor?
A sponsor is a line or staff officer (examples might include a Forest Supervisor, Assistant Regional Forester, District Ranger or other Station Director, or Project Leader). The sponsor’s role is to advise, counsel, review, problem solve, mentor, and coach the EU. While a sponsor is not required, the EP Steering Committee strongly recommends EUs have a sponsor, particularly in the first years of a new EU.
Can Enterprise Units have multiple sponsors?
For consistency and accountability it is recommended that each EU have just one sponsor. However, there is at least one situation where an EU has two sponsors. We also have situations where EUs have chosen to operate with a Board of Directors.
What if I can't find a sponsor on my unit?
A proposed EU does not have to use a sponsor who is located on a particular unit. You have the ability to use any appropriate sponsor regardless of their location.
What happens if an Enterprise Unit's sponsor leaves?
If a sponsor leaves the EU would either seek a replacement or decide at that time to no longer have a sponsor. They would need to make this determination in consultation with the Enterprise Program Director.
Can an Enterprise Unit “fire” its sponsor?
The EU may switch to another sponsor. If an EU is having difficulty with their sponsor the Director of the Enterprise Program should be consulted for assistance in resolving the situation.
CUSTOMERS
What are the advantages of Enterprise Units to Forest Service management?
Quality and timely deliverables: All Enterprise Units are sustained by the income generated by their project work. EUs are accountable to their clients and bound by their service agreements. In order to be successful, EUs must provide quality products and/or services within reasonable time limits to their clients.
EUs may reduce a client unit’s fixed costs, increase quality, and improve customer service by providing clients with alternatives for some services and products. The EU approach ties dollars directly to accomplishments on the ground.
Why would a customer hire an Enterprise Unit if their funding is nondiscretionary or they have an existing program to support?
There are two distinct advantages to hiring an EU:
- Specialized Expertise: Managers benefit by the specialized expertise offered by EU employees who are highly skilled in their fields.
- Cultural Understanding: Because Enterprisers are Forest Service employees they understand the agency’s mission, culture and way of doing business. This allows them to "hit the ground running" as soon as a work order for a project is in place.
Can Enterprise Units compete outside the Forest Service? Outside the government?
Since Enterprise employees are government employees, EUs can write agreements and do work for any government agency. Our authority for this is 31 USC 1535, The Economy Act of June 30, 1932.
While EUs can compete with private industry for government work, they cannot compete with private industry for jobs in the private sector. It is a line the EUs do not cross. Competition with private companies for government projects outside of the Forest Service may be subject to A-76 guidelines.
What recourse do dissatisfied customers have within the Enterprise Unit system?
Customers who do not receive satisfaction from an EU should initially raise their concerns with the sponsor and the Director of the Enterprise Program. If necessary an audience with the Enterprise Program Steering Committee may be appropriate. An EU that receives multiple complaints could have trouble remaining financially viable and ultimately could have their business license revoked.
|
