Customers

U.S. Citizenship and Immigration Service (CIS)

U.S. Citizenship and Immigration Services"By the time fees are in place, the data is already historical and full costs are not being recovered. So we have problems right there. This isn't like the private sector where we can just raise prices."

Paul Schlesinger, branch chief, CIS

Challenge

The U.S. Citizenship and Immigration Service, an agency of the U.S. Department of Homeland Security (DHS), administers the processes that control the entry of foreign-born persons to the United States, as well as those processes that provide benefits to them once they have been admitted.

Since 1968, the CIS had charged fees for their services with few problems. However, in the early 1990s, faced with rising costs, improperly allocated resources, increasing international activity, and scrutiny from the government's accounting watchdogs, the CIS found itself in need of a more accurate method of determining the costs of its services in order to justify fee increases.

Internally, Congress asked the U.S. Government Accountability Office (GAO) to review the CIS fee accounts. The GAO determined that the agency wasn't recovering full costs and that indirect costs were rising. Additionally, the Federal Accounting Standards Advisory Board had recommended three approaches for determining full costs, including activity-based costing (ABC). At that time, the CIS wasn't using any of the recommended methods.

With a healthy appreciation of the challenges associated with setting and defending fees and managing the escalating costs associated with running the agency, the CIS knew it needed a better costing methodology.

Approach

Using BusinessObjects™ Metify activity-based management (ABM) software, the CIS launched an ABC initiative to reengineer the way work was performed and to bring its fees more in line with costs.

The CIS chose BusinessObjects Metify ABM as the cost-calculation engine for this effort because of its multidimensional analysis and flexible reporting capabilities. The CIS project team built simple ABC models that were updated every two years through statistically driven sampling methods and detailed time-and-motion studies. The agency overcame challenges associated with the quality of data and the massive education of all stakeholders on the new methodology to achieve phenomenal results.

Results

The CIS was able to calculate the unit cost of inspections and use that information to set more appropriate fees, resulting in a net benefit of approximately $200 million. Additionally, the multidimensional costing capability in BusinessObjects Metify ABM allowed CIS to better understand unit-cost variances and improve the way the agency allocated resources.

By holding CIS accountable for the unit costs of an activity and/or product, the agency can measure its progress towards its goal of ultimately decreasing the fees charged to its customers.

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