**CHAPTER 5. SYSTEMATIC ANALYSES OF OPERATIONS (SAO)**

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# CONTENTS

## PARAGRAPH PAGE

5.01 Purpose 5-1

5.02 Responsibility 5-1

5.03 Scope 5-1

5.04 Analysis 5-2

5.05 Recommended Improvement Actions 5-2

5.06 Areas to be Covered 5-2

5.07 SAO Schedule 5-5

5.08 Reports 5-6

5.09 Supervisory Visits 5-6

**APPENDIX**

Appendix A. SAO Report Format 5-7

**CHAPTER 5. SYSTEMATIC ANALYSIS OF OPERATIONS (SAO)**

**5.01 PURPOSE**

A Sytematic Analysis of Operations (SAO) is a formal analysis of an
organizational element or an operational function of the Veterans
Service Center (VSC). A researched and well-written SAO is a valuable
management tool. It provides an organized means for reviewing operations
to identify existing or potential problems and proposing corrective
actions. This self-audit technique, when applied conscientiously, is a
positive guide for operational improvement. The primary objectives of an
SAO are to:

(a) Monitor progress toward established goals and objectives pertinent
    to subject area;

(b) Identify problems or out-of-line situations and recommend corrective
    actions;

\(c\) Assess areas of vulnerability;

(d) Determine effectiveness in achieving program directives;

(e) Identify opportunities for improvement in conducting internal
    operations and in providing service to claimants;

(f) Verify that records and reports accurately and properly reflect
    actual operations and results;

(g) Evaluate compliance with manuals, regulations, and other directive
    material; and

(h) Refer for consideration those opportunities for improvement, which
    require change in policy or other directives, or other action by
    higher authority.

(i) Historically document operational performance.

**5.02 RESPONSIBILITY**

a\. The Veterans Service Center Manager (VSCM) and Pension Maintence
Center Manager (PMCM) are responsible for the ongoing analysis of VSC
and PMC operations to include SAOs required by this chapter as well as
those required by station policy. To be successful, the analysis must be
approached positively. Place primary emphasis on improvement rather than
criticism. Present critical comments in a balanced perspective,
recognizing any unusual difficulties or circumstances. It is essential
to conduct the analysis objectively. Encourage all division personnel to
work closely with the analyst during the course of evaluation.

b\. Participation in the SAO process does not have be limited to
supervisory personnel. VSCMs and PMCMs may delegate responsibility to
other division personnel who are sufficiently experienced in VSC/PMC
operations and who display analytical ability. Sharing or rotating the
responsibility for SAOs may also be useful in providing a fresh look at
a situation.

**5.03 SCOPE**

Systematic analyses will encompass all elements of the VSC and PMC
activities. The time allotted to the review will depend on the size,
scope, and complexity of the activity under study. SAOs should be
performed at least annually and must cover all areas described in
paragraph 5.06. The Workload Management Plan which includes VETSNET
Operations Reports (VOR), Control of Veterans Records System (COVERS),
Veterans Appeals Control and Locator System (VACOLS), and Fiduciary
Beneficiary System (FBS) are tools to use.

**5.04 ANALYSIS**

a\. The goal of the analysis is to systematically review an activity and
look for potential areas of improvement. When problems are identified,
the analyst's job is to determine why they exist.

b\. SAOs should ensure effective and efficient benefit delivery. Each
analysis must address, at a minimum, these two key assessments: (1)
identification of any problem and/or potential problem areas, and (2)
recommendations/suggestions for corrective action. The depth of analysis
must be sufficient so that problems or potential problem areas are
clearly explained.

c\. Policy, procedure, and requirements contained in all VBA directives
may be utilized as evaluation criteria.

**5.05 RECOMMENDED IMPROVEMENT ACTIONS**

When problems or significant opportunities for improvement are
identified by an SAO, the report should include recommended actions to
remedy the problem or to implement processing improvements. The
recommended actions will be specific in terms of what is expected and
when it is to be accomplished. When specific recommendations are made,
the proposed plans for corrective action as well as the time frame
necessary for completion should be included in the SAO file.
Documentation of the actual corrections should also become part of the
SAO file.

**5.06 AREAS TO BE COVERED**

SAOs should be performed at least annually and must cover all aspects of
claims processing, including quality, timeliness and related factors.
The Claims Processing Timeliness Goals established in M21-4, Chapter 4
are to be used to identify an out-of-line situation. The analysis and
report requirements for out-of-line end products are defined in
paragraph 4.08. The areas for review listed below indicate the minimum
areas to be included. Division management may expand the areas of
consideration to ensure a thorough analysis.

**(1) CLAIMS PROCESSING TIMELINESS**

\(a\) Average cycle timeliness to include control time, development
initiation, development time, ready for decision time, decision time,
award generation time, and authorization time

\(b\) Average days to complete

\(c\) Average days pending

\(d\) Rating end products pending over six months and one year

\(e\) Non-rating related end products pending over six months

\(f\) Implementation of Workload Management Plan and effectiveness

\(g\) Special claim reviews, such as due process cases, Seriously
Injured (SI)/Very Seriously Injured (VSI) claims, etc.

\(h\) Received workload

\(i\) Pending inventory

**(2) QUALITY OF COMPENSATION, PENSION, AND ANCILLARY ACTIONS**

\(a\) Monthly internal quality review findings

\(b\) Systematic Technical Accuracy Review (STAR) findings

\(c\) Sample size of local quality reviews

\(d\) Analysis of single signature procedures for ratings, other
decisions, and award actions

\(e\) Overall trend analysis

\(f\) Clear and unmistakeable error (CUE) analysis

**(3) QUALITY OF DEVELOPMENT ACTIVITY**

\(a\) Initial development actions

\(b\) Subsequent development actions

\(c\) Burials

\(d\) Service Treatment Record requests

\(e\) MAP-D compliance

**(4) QUALITY OF CONTROL ACTIONS**

\(a\) First Notice of Death (FNOD)

\(b\) No record mail

\(c\) Claim establishment

\(d\) Military files

**(5) QUALITY OF FILES ACTIVITIES**

\(a\) COVERS compliance

\(b\) Files maintenance

\(c\) Active mail

\(d\) Drop mail

\(e\) Search mail

\(f\) Sequence schedule

\(g\) Locked files

**(6) QUALITY OF CORRESPONDENCE**

\(a\) Locally prepared letters

\(b\) Form letters

\(c\) Inquiry Routing and Information System (IRIS) responses

\(d\) Rating decisions

**(7) EXAMINATIONS, HOSPITAL SUMMARIES, AND HOSPITAL ADJUSTMENTS**

\(a\) Compensation and Pension Examination Program (CPEP) findings

\(b\) Contract examinations (i.e., QTC)

\(c\) Timeliness of action on hospital summaries

\(d\) Summary of joint conferences with medical facilities

\(e\) A&A and housebound adjustments (include current nursing home study
results)

\(f\) Pension reductions

\(g\) Paragraph 29 and 30

**(8) APPEALS**

\(a\) Analysis of appeal processing steps, to include control time and
an assessment of the timeliness and quality of decisions and
development.

\(b\) Specific analysis of the station's remands and reversals, to
include the results of a review of the reasons for those remands and
reversals, as well as a discussion of the special procedures being used
to ensure timely turnaround of the remands.

\(c\) Review of Workload Management Plan compliance

\(d\) Decision Review Officer (DRO) activities

\(e\) Other hearings/conferences

\(f\) Timeliness of scheduling

\(g\) Board of Veterans Appeals (BVA) travel board scheduling and show
rate

**(9) DIVISION MANAGEMENT**

\(a\) Staffing projections

\(b\) Workload projections/production capacity

\(c\) Employee/union/Veterans Service Organization relations

\(d\) Performance evaluations

\(e\) Delegations of authority

\(f\) Communication (to include VSCM or PMCM Memoranda)

\(g\) Division training

**(10) INTERNAL CONTROLS**

\(a\) Large retroactive payment certification process (\$25,000 payments
and \$250,000/8-year retroactive payments)

\(b\) Employee veterans/locked files

\(c\) Control of veterans' records

\(d\) Match Case Reviews (Social Security Administration (SSA) Death
Match, SSA Prison Match, Fugitive Felons, Bureau of Prison Match, and
Veterans on Active Duty, miscellaneous Pension matches)

\(e\) Controls to minimize compensation benefit overpayments

\(f\) Income Verification Match (IVM)

**(11) FIDUCIARY**

\(a\) Timeliness of work and workload control

\(b\) Quality

\(c\) Fiduciary Beneficiary System (FBS) records management

**(12) DIRECT SERVICES AND OUTREACH**

\(a\) Telephone interview quality and timeliness

\(b\) Personal interview quality and timeliness

\(c\) IRIS quality and timeliness

**5.07 SAO SCHEDULE**

a\. Prepare the fiscal year SAO schedule for the division so that it is
approved before September 1 of the preceding fiscal year. The schedule
must also show the staff position responsible for the report and the
month due. The VSCM or PMCM is responsible for preparing the SAO
schedule annually.

b\. SAOs will be conducted on a schedule that, at a minimum, meets the
requirements established in this chapter. However, analyses may be
prepared more frequently than scheduled to determine trends, obtain
facts for special reports, or determine quality in specified areas. It
may be necessary to analyze only a segment of an area of review more
frequently than scheduled. For example, if hospital adjustment
processing was determined to be a problem, then hospital adjustments
should be analyzed more frequently until the situation is resolved.
Retain the findings on such interim studies in the division
administrative files and reference these studies in the next regularly
scheduled SAO on the topic.

**5.08 REPORTS**

a\. SAOs should be concise but thorough and be approved by the VSCM or
PMCM.

b\. Retain a copy of the SAO and related working papers in a folder
specific to the topic. The folder should be maintained in the division
administrative files.

c\. Dispose of these reports and related material in accordance with RCS
VB-1, part I, item number 13-098.000.

d\. The recommended format shown in Appendix A is for guidance purposes.
The station Director may authorize use of an alternate format, as long
as the topic is adequately analyzed and findings, conclusions, and
recommendations are reported.

> **5.09 SUPERVISORY VISITS**
>
> a\. Purpose. Supervisory visits of employees whose work is located
> outside the office are encouraged as a means of sharing information,
> best practices and observing the work style of the employee.
> Supervisory visits are primarily made to ensure compliance with basic
> directives and mandatory procedures, to evaluate personally the
> quality of services provided, to ensure that veterans' privacy
> information is secured when not in use, and to appraise effectiveness
> and economy of operations. Review of an individual's workload
> management skills to include completed work and timeliness can easily
> be tracked through reports and through the use of quality reviews. In
> certain instances, however, a supervisory visit should also be
> scheduled. Specific circumstances will dictate a mandatory visit with
> additional visits scheduled at local option.
>
> b\. Out based Employees. Each fiscal year the VSCM or other designated
> supervisor will schedule and conduct supervisory visits to observe
> employees whose primary duty is working outside the regional office at
> a subordinate location. This will include those outbased at VA medical
> centers, outpatient clinics, or itinerant points. Employees who
> perform frequent, recurring outreach such as military services
> coordinators and each person responsible for conducting field
> examinations as a primary job function will also be visited. At a
> minimum, an annual visit will be conducted with each employee who has
> held the position for less than 3 years or with an employee,
> regardless of tenure, who has been identified as having performance
> issues. Additional visits may be scheduled as determined by the VSCM
> or designated supervisor.
>
> c\. Reports. Supervisory visit reports will reflect an accurate
> account of what was observed during the visit. The report format and
> content will be determined locally. However, the report should address
> the following areas in addition to any locally specified reporting
> requirements.

1\. Employee's rapport with customers and other individuals in the
assignment.

2\. Aspects of the job the employee is doing well.

3\. Aspects of the job the employee needs to improve.

4\. Problems or comments expressed by the employee and solutions
discussed.

5\. Security measures are in place to ensure that sensitive information
is protected.

6\. General comments based on review of cases observed during the
supervisory visit.

**APPENDIX A. SAO REPORT FORMAT**

**DATE:**

**TITLE:**

**REFERENCES:**

**DESCRIPTION OF REVIEW:** (Date of review, time period covered,
criteria used, sampling techniques, key findings of last review.)

**FINDINGS:** (Summary of results of review and comparison with findings
of prior review.) List all subtopics for the subject area being
discussed and outline specific conclusions for each subtopic\--sample
subject area is Quality of Files Activities.

1.  COVERS compliance:

2.  Files Maintenance:

3\. Active Mail:

4\. Drop Mail

5\. Search Mail:

6.  Sequence Schedule:

7.  Locked Files:

**CONCLUSION:** (Evaluate the area under review, compare findings with
established program requirements or guidelines and specify any
deficiency. Include references used in making the determinations.)

**PREVIOUS REVIEWS/ACTIONS:** (Discuss the impact of actions taken as a
result of previous or ongoing management actions.)

**RECOMMENDATIONS:** (Proposed actions to correct deficiencies or
improve operations.)

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Prepared By Date

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Approved By Date

Veterans Service Center Manager or

Pension Maintenance Center Manager