PDSEPI

A Social Enterprise Project

For Cavite Province

Proponent: Capt. Cezar Hernandez

Dasmarinas, Cavite

Prepared By: Pedrito A. Salvador

PS Consulting
Imus, Cavite
February 12, 2008

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Title: PDSEPI A Social Enterprise Project for Cavite Province
Company: Philippine Development for Social and Economic Progress Inc.

Content: Project Study Proposal

Date: February 12, 2008

This document is confidential. It needs authorization before re-distribution.

Executive Summary
Vision Statement

PDSEPI vision is to promote the development and welfare of Filipino society;

enhancing accountability of improvement of social welfare services; facilitating
field offices to better serve the community and advocating equality, justice, social
integration and a caring society.

Mission Statement

PDSEPI mission is to establish an organization that is highly accountable,

efficient, effective and responsive to social needs, upholding the long-term
sustainable development of society and the well being of the Filipino citizens
specifically the marginalized and the disadvantaged sector.

The Company

PDSEPI was founded in February 2, 2008 and was designed to deliver vital social
services and provide jobs to improve the economic life of its employees as well as
its beneficiary, the Filipino people especially the marginalized and disadvantaged
sector. It is a private non -stock, non-profit corporation with an initial office
located at 24 Serrano St. corner 7th Avenue, Grace Park, Caloocan City,
Philippines.

Description of the Service

By 2012, Cavite’s poor communities shall have met their basic needs and built
their capacities for self reliance, genuine participation and involvement in
effective governance, as well as equitable access to development opportunities.

PDSEPI will deliver the following services in the province:

A. Social Welfare Projects

1. Health Care Services Projects

2. Housing Projects

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 3. Educational Services Projects
4. Construction/Improvement of Barangay Facilities
5. Special Projects for Disabled and Senior Citizens
6. Spiritual Development Projects
7. Environmental Management Projects

B. Economic Projects

1. Creation and Organization of Cooperatives

2. Construction of Farm Irrigation Systems
3. Livelihood Projects
4. Farm to Market Roads
5. Agro-Industrial Projects
6. Tourism Projects

Presently, PDSEPI project is subject for approval by the Financiers. The go

decision is expected to happen within three months i.e. June 1, 2008. Once
approved the company plans to follow the project plan and apply it initially in the
province of Cavite.The project proponent thinks that Cavite is very suitable as an
initial experimental location to start with since needed manpower and resources
are easily available here. Moreover effective management and supervision can
easily be established in this place. All challenges and resolutions that were
experienced during the time of project implementation if applicable can be
applied to the succeeding Philippine provinces.

Critical factors in the delivery of the services however are the availability of
qualified personnel, coordination with Local Government Units and potential
security and safety of PDSEPI personnel specifically in the remote Barangay
areas.

Description of the Beneficiaries

The target beneficiaries are the marginalized and the disadvantaged Filipino
citizens now living in all municipalities and cities of Cavite. In 2007, they are
estimated at 208,482 (8.6% of Cavite population of 2.42 million) or equivalent to
41,696 families (for a family of 5). These people for a long period of time have
been deprived of with some of the basics necessities in life in terms of continuous
availability of affordable foods, shelter, clothing, health care and education.

The focus of PDSEPI is to help these people improve their social and economic
lives by making them productive by increasing their income, improve their
dignity and self- esteem, and increase their faith in God and to their fellowmen,
thus enhancing their participation in nation building. Basic social services will be
delivered to them at a very minimum or no cost at all and at the same time giving
them jobs for continuous self-sustenance.

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Risk/Opportunity

The risks that PDSEPI is seeing in the implementation of this project is the
continuous increase in the price of petroleum products that will affect the
operating cost in the management of the various social and economic projects.
PDSEPI needs to continuously formulate effective strategies and action plans to
face these challenge. Another risk is the continuous transfer of squatters from
Metro Manila to Cavite and migration of people from other provinces to look for
jobs in the economic zones. To compensate this, an average rate of 5.45%
increase in population will be used every year in the computation.

Fortunately, the continuous improvement of pesos over the dollar will reduce the
cost of importing equipment, machineries, materials and technologies needed in
the effective operations of PDSEPI. The project is also seen to minimize if not
eliminate social problems in Cavite in the future.

Management Structure

The organizational structure was designed to meet all the stakeholders’

expectations and the organization’s goals and objectives. The organization will be
headed by a president and will be supported by five vice presidents that will be in-
charge in handling Human Resource Department, Finance and Accounting
Department, Operations Department, Logistics Department, and Research,
Planning and Development Department. The men and women of the management
team will be persons with high integrity, with deep working experience and
possess wide exposure in leadership of people and resources. They will have a
combined average minimum of twenty years of experience from different sectors
of society i.e. government, education, military, manufacturing and services.

A strong group of Board of Directors and Management Consultants will be

available to guide top managements in executing their important duties and
responsibilities. A Corporate Attorney will also be hired to handle all the legal
accounts of the company.

Capital Requirements

A total of 81.76 Billion pesos is needed to finance all socio-economic projects to

improve the lives of marginalized sector of Cavite province. With these projects,
the economic group is estimated to yield a total of 871.79 Million pesos of
income annually using an assumed conservative 10 % rate of internal return. Note
that these economic projects are undertaken to give jobs to the affected
marginalized sector of Cavite province.

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 Socio-Economic Project Budget Summary

Social Welfare Projects Project Budget Php

1. Health Care Services Projects 9,753,050,000

2. Housing Projects 27,102,400,000
3. Educational Services Projects 27,036,200,000
4. Barangay Facilities Construction Projects 3,067,000,000
5. Projects forDisabled and Senior Citizens 191,700,000
6. Spiritual Development Projects 290,150,000
7. Environmental Management Projects 707,350,000
Total 68,147,850,000

Economic Projects Project Budget Php

1. Cooperatives 2,777,150,000
2. Farm Irrigation Systems 1,974,000,000
3. Livelihood Projects 1,212,550,000
4. Farm to Market Roads 650,000,000
5. Agro-Industrial Projects 82,550,000
6. Tourism Projects 67,500,000
Total 6,178,750,000

Socio-Economic Total 74,326,600,000

10 % Contingency 7,432,660,000
Sub Total 81,759,260,000

PDSEPI Financial Budget

To effectively implement the execution of all socio-economic projects, PDSEPI

needs a total of 215.3 million pesos for its building and facilities while the
organization will need a total of 9.87 billion pesos for its fixed capital operating
expenses. The first six month of pre- operating period will require a total of 12.6
million pesos to handle all the necessary start- up expenses.

PDSEPI a social enterprise, will thus seeking an overall total of 91.86 billion
pesos of financing assistance from a willing and humanitarian investor to fully
assist in improving the lives of marginalized Filipino Citizens of Cavite province.

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 Project Timetable

Activity Target Completion

PDSEPI Project Study Approval June 2008

Budget Release June 2008

Building/Facilities Construction November 2008

Executives Recruitment July 2008

Manpower Recruitment/Training October 2008

Kick-Off December 2008

Start -Up Operation January 2009

Conclusion

PDSEPI will commence its major operation on the first week of January
2009 at a budget of 91.86 billion pesos.

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 Table of Contents
Page

Executive Summary 2
Table of Contents 7
Introduction 9
Description of the Project 11
Mission 11
Company Overview 12
Company policy 13
Description of the Service 23
Social welfare projects 25
Economic Projects 26
Description of the Beneficiaries 27
Management Structure 28
Operations Management 28
Purchasing Policy 30
Human Resources Management 34
Human Resource Policy 34
Department Functions 37
Manpower Summary 40
Risk/Opportunity 40
Capital Requirements 41
Financial Evaluation 42
Assumptions 42
Socio-Economic Projects Budget Plan 42
Socio-Economic Annual Revenue 44
Fixed Capital Operating Budget 45
Building/ Facilities Budget 48
Pre-Operating Budget 48
Manpower Budget 49
Projected Variable Operating Expenses 51
Conclusion 51

Appendixes 52

1. Analysis of Social Developments 53

2. Cavite Province Profile: 2007 55

3. List of Cities and Municipalities 59

4. Cavite Poverty Incidence Map 60

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5. Annual per Capita Poverty 61

6. Cavite Political Divisions 62

7. Millennium Development Goals 63

8. E-Procurement Systems 68

9. Enterprise Resource Planning 70

10. JIT and Purchasing 77

11. Minimum Wage Calabarzon 82

12. Nominal and Real Wage 85

13. Maps of Cavite 85

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 Introduction
The Philippine Situation

The Philippines is ranked as a lower Middle Income Country (US$1,300 per

capita in 2005), but is beset by extreme inequality of wealth distribution. Between
1999 and 2004, per capita income in nominal terms increased annually by 2% on
average. A combination of relatively slow economic growth (some 4% average in
the past decade) and high population growth explains this minimal improvement.
The unemployment rate has remained at around 11% since 2000, leading to more
and more Filipinos seeking work outside the country, with accompanying high
social costs.

While the Philippines is not a poor country, it is nevertheless a country with a lot
of poor people: about 30 % of its total population, some 30 million people live
below the National Poverty Line (European Commission-Philippines Strategy
Paper 2007-2013). See Appendix 1

The country has not achieved sufficient economic progress over the past decades
to substantially reduce poverty, due mainly to high population growth, lack of
employment creation, rampant corruption, feudal politics and insurgencies, one
communist-inspired, the other triggered by Islamic separatism.

Combined with the lack of a national policy to slow its 2.3% annual
population growth, its ability to achieve the Millennium Development Goals
(MDGs) is seriously compromised (see Appendix 7). The Philippines lags
economically behind the rest of the region and has recently been facing a severe
fiscal crisis, with the highest deficit in the region of 5 % of GDP. At the same
time it needs to service a national government debt of 78% of GDP.

The Philippines is witnessing an erosion of confidence in elected government and

political institutions, coupled with a feeling of impotence to achieve substantial
change towards a more equitable distribution of wealth. Although some measures
to redress the fiscal balance have been taken, more economic reforms are
necessary to sustain the momentum.

Fighting Poverty.

The first pillar in fighting poverty is anchored on the experience of most countries
in East Asia where, through sustained economic growth, poverty incidence was
reduced by at least half in just two decades. Growth reduces poverty by creating
employment and raising incomes. With growth also come higher public revenues
that can finance basic education and health care, and infrastructure, which is
critical for bringing down costs and raising productivity to spur further growth.
Sustained growth is thus good for the poor.

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The second key element, social development, is necessary to enable everyone
to participate in growth. There are people who are poor because of personal
circumstances that lead to inferior income prospects. Owing to low levels of
human capital investment, partly because of lack of access to basic services (e.g.
education, health, nutrition), or the absence of complementary inputs to increase
their outputs (e.g. credit, technological and market information), the poor are
often denied opportunities to advance economically. Some people are poor also
because they may lack the ability to manage risk and, therefore, become
vulnerable to adverse income shocks arising from fluctuations in the economy.
Social development calls for targeting interventions to assist certain groups or
sectors of the population that are likely to be marginalized by the growth process.

Finally, good governance is critical to poverty alleviation because it makes sound

macroeconomic management, which is important for growth, possible, and paves
the way for participatory, pro-poor policies. Good governance ensures
transparency in the use of public funds, encourages private sector growth,
promotes effective delivery of public services and helps to establish the rule of
law.” These key elements are expected to lead to socially inclusive development.

The main challenges therefore for the Philippines are to:

• reduce poverty through stronger job creation and better access to services,
especially social services, as well as to employment and income earning
opportunities for the poor; and
• achieve a more equitable distribution of wealth through economic, social and
political reforms.

Cavite Province

According to Asian Development Bank (Poverty in the Philippines: Income,

Assets, and Access, January 2005, page xvii) successive governments of the
Philippines since 1985 have attached a high priority to poverty reduction, but had
only moderate success in reducing the overall headcount, and outright failure in
reducing the absolute number of poor Filipinos.

Moreover quoting more from the ADB book (Poverty in the Philippines: Income,
Assets, and Access, January 2005, page xii) there were four million people more
poor in 2000 than there were in 1985. Likewise, the poverty incidence of families
has increased from 28.1% to 28.4% between 1997 and 2000.

Cavite province was one among the provinces of the Philippines that has been
affected with this problem. In 2003 and 2004 Cavite made it to the top 10, in
terms of Provincial Poverty Threshold at Php 16,128 and Php 15,950 respectively.
At the end of 2007, it further aggravates to Php18, 019 (see Appendix 2).

Finally the book mentioned, that the number of poor people in the Philippines will
continue to increase.

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In this context, the main objective of PDSEPI is to support the Philippine
government in the sustainable reduction of poverty. This project was envisioned
to start in the province of Cavite. Moreover, this objective will be pursued
through the provision of assistance to equitable access to social and economic
services through budget support and sector-wide approaches (on the basis of
decentralized development, i.e. through coordination and cooperation with local
government units). This will be complemented by a focused range of actions
funded through various thematic and budget lines and other programs.

This will be the basis how PDSEPI will approach its vision and mission.

Description of the Project

This project study will delineate the different policies, and strategies in the
implementation of the programs needed to meet the goals and objectives
of the company.

The study will also define the set of activities and the organization functions to
make the operations more viable and successful.

The study will also present the initial budget needed to finance the operational
activities for the areas identified and classified as vital thus requiring an
immediate attention and action.

Mission Statement

The company’s mission is to establish an organization that is highly accountable,

efficient, effective and responsive to social needs, upholding the long-term
sustainable development of society and the well being of the marginalized
Filipino citizens.

The company aspires to develop a reputation as being one of the prime movers in
the development of economic and social needs of Filipinos that belong to the
marginalized sector of society. They will be empowered to meet their minimum
basic needs of health, food and nutrition, water and environmental sanitation,
income security, shelter and decent housing, peace and order, education and
functional literacy, participation in governance, family care and social integrity.
This can be achieved thru effective management of people and resources as well
as a good coordination with the local government units and different stakeholders.

The company shall address this fight against poverty through a multi-dimensional
and cross sector approach which recognizes and respect the core values, cultural
integrity and spiritual diversity of target sector and communities.

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Policy, programs, and resource and commitments shall be clearly defined to
ensure accountability and transparency in the execution and implementation of all
identified projects.

To accomplish the goal and objectives, PDSEPI needs enough capital, the highest
available management talent with each having an utmost integrity and credibility,
and an efficient and modern office facility that will provide fast technical support
in the execution of social welfare and economic projects.

In pursuit of the goal, PDSEPI will resolve to treat stakeholders, beneficiaries and
the community with service that don’t last. These groups will see the company as
partner in continuous progress today and to the future.

Company Overview

PDSEPI was founded in February 2, 2008 and was designed to deliver vital social
services and provide jobs to improve the economic life of its employees as well as
its beneficiary, the Filipino people specifically the marginalized citizens. The
legal name of the company is Philippine Development for Social and Economic
Progress Inc.It is a private non -stock, non-profit corporation with an initial office
located at 24 Serrano St. corner 7th Avenue, Grace Park, Caloocan City,
Philippines.

After approval of this project study, the company will transfer and will be housed
in a 15,000 sq. meters lot area that will include both the building and all the
facilities required to fully operate the company efficiently and effectively. An area
of 2,500 sq. meters will be allocated for the building, 2000 sq. meters for the
warehouse and the rest space for other facilities. All departments will be under
one roof to facilitate fast communication and interaction. It is expected that the
building facility will be adequate for the company’s needs for five years
operation.

PDSEPI Core Values

At PDSEPI, the company believes in doing a great job for the beneficiary,
employees and other stakeholders by being the pre-eminent building-block social
welfare service provider to the Filipino society. The company’s values are put
into practice each day by PDSEPI employees, and govern how they deal with
their communities and each of their beneficiaries.
These values are at the heart of everything they do.

Risk Taking — Employees strive to:

•Foster innovation and creative thinking.
•Embrace change and challenge the status quo.
•Listen to all ideas and viewpoints.
•Learn from successes and mistakes.

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•Encourage and reward informed risk taking.

Quality — Employees strive to:

•Achieve the highest standards of excellence.
•Do the right things right.
•Continuously learn, develop and improve.
•Take pride in their work.

Great Place to Work — Employees strive to:

•Be open and direct.
•Promote a challenging work environment that develops diverse workforce.
•Work as a team with respect and trust for each other.
•Win and have fun.
•Recognize and reward accomplishments.
•Manage performance fairly and firmly.

Discipline — Employees strive to:

•Conduct business with uncompromising integrity and professionalism.
•Ensure a safe, clean and injury-free workplace.
•Make and meet commitments.
•Properly plan, fund and staff projects.
•Pay attention to detail.

Results Orientation — Employees strive to:

•Set challenging and competitive goals.
•Focus on output.
•Assume responsibility.
•Constructively confront and solve problems.
•Execute flawlessly.

Beneficiary Orientation — Employees strive to:

•Listen and respond at once to beneficiary, suppliers and stakeholders enquiries
•Clearly communicate mutual intentions and expectations.
•Make it easy to work with them.
•Excel at stakeholder satisfaction.

Company Policy

PDSEPI shall always seek to conduct business with the highest standards
of excellence and integrity. A core component of Discipline value is to
conduct business with uncompromising integrity and professionalism.

The drive for excellence touches every aspect of the service functions.
Whether in beneficiary interactions, oversight of contractor safety or
stakeholder engagement in local communities, the “How” is as important
as the “Why”.

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PDSEPI Corporate Principles (PCPs) serve as the backbone for guiding
the employees including officers as they conduct their job and
responsibility.

PDSEPI believe that this policy shall be transparent and available for both
the internal and external stakeholders.

The PCPs are intended to express the company’s commitment to ethical and legal
business practices. These principles define a minimum set of ethical standards for
all employees. PDSEPI adheres to strict standards of honesty and conducts
business with uncompromising integrity and professionalism.

These principles:

•Shall be reviewed on a regular basis for the company is committed to apply

internal management systems and reporting structures to ensure adherence to
these principles across the organization.

Accordingly:

•PDSEPI respects, values and welcomes diversity in its workforce, its

beneficiaries, and its suppliers. The company will comply with all applicable laws
and provide equal employment opportunity for all applicants and employees
without regard to religion, sex, national origin, ancestry, age, disability, veteran
status, marital status, sexual orientation or gender identity. This applies to all
areas of employment. The company also provides reasonable accommodation to
disabled applicants and employees to enable them to apply for and to perform the
essential functions of their jobs.

•The company shall provide a workplace free of sexual harassment as well as

harassment based on religion, sex, national origin, ancestry, age, disability,
veteran status, marital status, sexual orientation or gender identity by managers,
co-workers or non-employees in the workplace.

•PDSEPI is committed to achieve high standards of environmental quality and

service safety, and to provide a safe and healthful workplace for the employees,
contractors, and communities. The company strives to comply with all applicable
regulatory requirements as a minimum and implement programs and processes to
achieve greater protection, where appropriate. The company also seeks a healthful
and safe workplace, free of occupational injury and illness. PDSEPI strive to
conserve natural resources and reduce the environmental burden of waste
generation and emissions to the air, water, and land.

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•PDSEPI expects its suppliers to comply with applicable laws concerning
occupational health, safety and environmental protection, to strive for a workplace
free of occupational injuries and illnesses, and to engage in construction projects
that minimizes impact to the environment and the community. The company
expects suppliers to maintain progressive employment practices that meet or
exceed all applicable laws.

These include nondiscrimination in employment practices, prohibiting the use of

child or forced labor, providing minimum wages, employees’ benefits and
prescribed work hours. In the event local standards do not exist, suppliers shall
nonetheless establish progressive employment practices.

•PDSEPI shall provide a secure business environment for the protection of the
employees, product, materials, equipment, systems and information.

•The company prohibits bribes and kickbacks. PDSEPI employees may not offer
or accept a bribe or a kickback. Bribes and kickbacks are prohibited either directly
or through a third party.

•PDSEPI is committed to complying with all applicable laws in the country. This
includes laws regarding: minimum ages for employment; minimum wages and
overtime compensation; benefits; discrimination and affirmative action;
employees’ right to raise issues and work collectively for their mutual benefit; and
health and safety.

PDSEPI Corporate Principles

To help guide employees to make the best possible decisions, PDSEPI has created
the PDSEPI Corporate Principles (PCPs). Although they are not a detailed manual
for resolving every question or conflict, the PCP’s have been designed to provide
useful guidance about the way employees are to do business every day.

The PCP’s apply to all officers and employees of the company. References to
“employees” refer to directors, officers and employees of PDSEPI.
In work environment, the employees often face challenging and ambiguous
issues. It is their responsibility to work through those issues in a disciplined
fashion and reach the right result for the company, its stakeholders and
employees. Ultimately, the employees are responsible for their actions.

PDSEPI is committed to conduct business with uncompromising integrity. The

PCP’s which are detailed below with the addition of several other policies, help
employees to meet that critically important commitment.

Ethics and Compliance

Honest and ethical conduct, including the ethical handling of actual or perceived

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conflicts of interest between personal and business relationships, is the rule every
day and for all that employees do

Bribes and Kickbacks

PDSEPI position on bribes and kickbacks is simple: they are not appropriate
business behavior, they are usually illegal, and they are not allowed. A bribe is a
thing of value given to someone with the intent of obtaining favorable treatment
from the recipient. Kickbacks consist of payment in cash or in kind, including
goods, services, the use of another company's property, or forgiving any sort of
obligation provided to a customer or supplier for the purpose of improperly
obtaining or rewarding favorable treatment in connection with a sale or purchase.

Bribes and kickbacks may not be offered either directly or through another party.
If a supplier offers a PDSEPI employee a bribe or kickback, the employee shall
report the attempt to his/her manager. The employee's manager then shall report
the attempt to the Purchasing Manager.

Receiving Gifts and Gratuities

Any form of a gift that obligates an employee to act in a particular manner with
regard to PDSEPI business is a bribe and is not allowed, regardless of its value.
Cash gifts are not allowed, whether, for example, for referring a PDSEPI
employee to a search firm, for purchasing favors or for sales to outside parties. A
sample provided by a supplier for evaluation purposes is PDSEPI property and is
not for personal use or profit.

In some limited circumstances it may be customary or appropriate to exchange

gifts and entertainment with suppliers, and it similarly may be customary and
appropriate to arrange or take part in programs and events that include meals and
lodging.

Some sample situations:

•Business-meal discussions with a supplier are legitimate. A free private meal for
an employee and spouse is not a legitimate function.
•Speaking at a continuing education program where the sponsor pays for the
related travel and lodging is legitimate if the employee’s manager reviews and
approves the business-related purpose of the event.
•Generally, it is not appropriate for an employee to accept a supplier’s invitation
to attend an entertainment or sporting event at the supplier’s expense.

An invitation to an entertainment or sporting event such as a golf or tennis

tournament may be appropriate if it demonstrably helps to build or maintain a
business relationship. Before accepting such an invitation, an employee
must obtain approval from his Superior, or Manager of Purchasing. Sound

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judgment is necessary for determining when invitations to such events are
appropriate.

The key is to keep an arm’s length relationship and avoid excessive or lavish gifts
or events that may give the appearance of undue influence. An employee shall
also avoid personal financial transactions with suppliers that may influence the
employee's ability to perform his or her job.

As a related point, you may not take for yourself any opportunity for financial
gain that you find out about because of your position at PDSEPI or through the
use of company property or information. A personal gift from a supplier,
unrelated to a legitimate business event, is not acceptable. Gifts of a commercial
or promotional nature are acceptable only if their value does not exceed Php 100.

If an employee recipient is not sure of an item's value, the employee shall use
common sense to attempt to determine fair market value; and if any question
exists about whether the gift is excessive in value, then the item should be
returned. If it cannot be returned, the gift shall be used as a door prize or for
raffles at company functions, given to a charitable organization or distributed
within PDSEPI in such a way that the value rule is not violated. For example, a
gift of snack food during a holiday could be shared within the business unit of the
recipient.

If an employee knows that he or she will receive a gift of value, he or she can
suggest that instead of the gift, a donation be made in the giver’s honor to a
charity.

Employees always shall inform their managers when receiving gifts or gratuities
if anyone could perceive a conflict of interest, even if the employee doesn't
believe the favor would violate the guidelines. Likewise, when unsure about
proper conduct, employees shall describe the situation to their manager. If more
direction is needed, seek input from HR, or Company Purchasing authorities.

Giving Gifts and Gratuities

Equivalent rules apply to the giving of gifts. Obviously, they shall not be offered
as bribes. Employees shall also take care to avoid giving gifts that are intended to
be innocent but may be construed as a bribe. Gifts and entertainment for LGU’s
officials, and suppliers must support company’s legitimate business interests and
should be reasonable and appropriate under the circumstances. Consistent with
the obligation, every employee has to act with integrity and honesty at all times.
No employee shall take unfair advantage of anyone through misrepresentation or
any unfair business practice.

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Some sample situations:

•It is permissible to give away plaques, supplier awards and prizes that are part of
official company programs.
• Free access to company resources or assets, such as computer time, and scrap or
excess materials, is expressly forbidden.
.
Employees always shall inform their managers when considering giving gifts or
gratuities if anyone could perceive a conflict of interest, even if the employee
doesn't believe the favor would violate company’s guidelines. Likewise, when
unsure about proper conduct, employees shall describe the situation to their
manager.

Special Government Ethics Rules

Conducting business with government is not the same as conducting business

with private parties. These transactions often are covered by special legal rules.
The employee shall consult the Legal Department to be certain that he or she is
aware of any such rules and must have approval of the Legal Department before
providing anything of value to a government official.

PDSEPI prohibits the payment of bribes to government officials. “Government

officials” are employees of Philippine government including low-ranking
employees or employees of government-controlled entities. The term
“government officials” also includes political parties and candidates for political
office. It is the employee’s obligation to understand whether someone he deals
with is a government official.

The prohibition on bribes applies to third parties acting on behalf of PDSEPI,

including all contractors and consultants. Employees must not engage a contractor
or consultant if the employee has reason to believe that the contractor or
consultant may attempt to bribe a government official.

PDSEPI may hire government officials or employees to perform services that

have a legitimate business purpose, with the prior approval of his manager. For
example, an off-duty police officer might provide security. Government officials
shall never be hired to perform services that conflict with their official duties.

Conflict of Interest and Disclosure

All employees shall avoid any activity that is or has the appearance of being
hostile, adverse or competitive with the company, or that interferes with the
proper performance of their duties, responsibilities or loyalty to PDSEPI.

Employees shall always inform their managers when confronted with any
situation that may be perceived as a conflict of interest, even if the employee

18
doesn't believe the situation would violate PDSEPI guidelines. Likewise, when
unsure about proper conduct, employees shall describe the situation to their
manager. If, after checking with any affected business units, the employee's
manager concludes that there is or may be a perceived conflict of interest, the
manager should consult with the Legal Department.

The Legal Department shall work with the Purchasing Manager, or appropriate
employee management to determine if there is a real or perceived conflict of
interest. If a conflict exists, it may be necessary to transfer that employee, require
the employee to divest himself or herself of the interest, or remedy the situation as
a condition of continued employment.

Influencing the Business of a Supplier

If an employee is in a position to influence the business situation of a supplier, the

employee shall disclose to his or her manager all financial, proprietary or other
types of controlling or influencing interests (for example, through a member of
the immediate family or a close personal friend) that the employee may directly
have. (Note: Financial or proprietary interest includes investments and loans.)
Any employee in a position to influence the purchases of materials or services
shall formally disclose any situation wherein a member of the employee's
immediate family or a close personal friend is employed by a PDSEPI supplier.

In such a circumstance, the employee may be required to take steps to avoid an

actual or perceived conflict with the interests of the company. These steps may
include disposing of the financial interest, resigning as officer or director of the
supplier or customer, or transferring to another job within the company.

Personal Investments in Suppliers, or Other Companies

An employee is not prohibited from making a personal investment in a company

just because it might be a supplier of PDSEPI or have some other business
arrangement with the company. However, under the law any such investment may
only be made so long as it does not involve the misuse of inside information. In
addition, under these PCPs such an investment may only be made so long as it
does not create an actual or perceived conflict of interest with PDSEPI. One way
to avoid these potential issues is to invest in companies that do not have business
relations with the company.

As another alternative, you may want to consider investing in a fund whose

investments are chosen by persons not related to yourself, such as the fund
managers or sponsors. You shall also understand that some business units have
decided to adopt more restrictive rules concerning personal investments in
companies with relations with PDSEPI, and each employee is responsible to know
whether his or her business unit has any such rules in place.

19
Employees who are in a position to influence decisions about PDSEPI
investments in other companies may not trade in the shares of those companies.

Outside Employment

An employee may not directly or indirectly conduct outside business that

interferes with the proper performance of the employee's job at PDSEPI, is
conducted during an employee's normal working hours, utilizes company’s
confidential information or specialized skills and knowledge gained as an PDSEPI
employee, or puts the employee in a situation where company’s confidential
information may be used intentionally or unintentionally. This restriction includes
having some types of part-time jobs, becoming a contractor, consultant or supplier
to PDSEPI while being employed at the company

Subsequent Employment with Supplier

PDSEPI shall not conduct business with a former employee who becomes
employed by a supplier or who offers his or her services as an independent
contractor for a period of 12 months from the employee's termination date,
without prior written approval from the Vice President of Logistics or the
Purchasing Manager.

Outside Director or Board Adviser Positions

An employee seeking to accept a position on a board of directors or board of

advisers of a for-profit or non-profit must first seek and obtain permission in
accordance with procedures maintained by the Legal Department for the purpose
of better avoiding conflicts of interest and minimizing potential liability to
PDSEPI. This requirement does not apply to a board position for a local non-
profit organization such as a hobby club, residents' association, or religious group,
where the likelihood of any such conflict of interest is low.

Taking Corporate Opportunities for Personal Gain

You may not take for yourself any opportunity for financial gain that you find out
about because of your position at PDSEPI or through the use of company property
or information. For example, PDSEPI employees may not participate in any
directed shares programs offered by other companies, if the offer was made
because of the employee's position at PDSEPI.

Political Positions

Political positions shall be treated like other examples of possible conflicts of

interest. An employee may not hold a political position that interferes with the
proper performance of the employee's job at PDSEPI. The employee shall need to

20
choose between the PDSEPI role and a political position of that type. Any
employee who wishes to take on a political position shall first disclose this fact to
his/her manager and must consult with Legal Department to understand
potential conflicts of interest in the political role given his/her PDSEPI
employment.

To avoid confusion and the appearance of any conflict of interest, an PDSEPI

employee working in a political role must communicate clearly that he/she is not
representing PDSEPI or its views in his/her political capacity and that the views
expressed are his/her own and not those of PDSEPI.

Corporate Records Management

All employees shall be aware of PDSEPI record retention guidelines and adhere
to them in all aspects of their daily work.
Employees shall also:
•Retain in the office only records that are needed for critical ongoing projects or
for other essential business reasons.
•Remember that a record can consist of text, graphics or photographic images and
is media-independent. Employees shall apply the same standards to electronic
records as they do to those in hard-copy form.
•Retain records regarding employment and personnel matters consistent with the
records retention guidelines. In many cases, these records must be kept for a much
longer time period than other types of documents.

Software Compliance

PDSEPI policy is to always pay for software when payment is expected or

required for company related business, or when software is used on PDSEPI
equipment or PDSEPI premises. Software shall be used according to applicable
copyright laws, software licensing agreements, and PDSEPI guidelines.
"Software" includes, but is not limited to, any and all applications programs,
video and audio files (for example MP3, MPG, AVI and so forth). PDSEPI
requires that each employee, as well as those employees of temporary agencies or
contractors, become familiar with, understand and comply with permitted uses of
software.

Employees are prohibited from obtaining or using software that is not paid for,
obtaining or using illegal copies of software, making or distributing illegal copies
of software, and using software in any way that violates any law, license
agreement or PDSEPI guideline. "Obtaining or using" refers to borrowing,
copying, downloading or acquiring by any other means.

All managers and employees are required to follow these principles in all aspects
of work that they conduct for PDSEPI and any of their activities that use PDSEPI
equipment or are done on PDSEPI premises. Particular methods of implementing

21
these principles shall vary depending on the situation and the applicable software
license agreement. An employee with any questions shall contact the Legal
Department.

Environmental Health & Safety

PDSEPI is committed to achieve high standards of environmental quality and

product safety, and providing a safe and healthful workplace for employees,
contractors and communities.
The company shall comply with all applicable regulatory requirements as a
minimum, and implement programs and processes to achieve greater protection,
where appropriate. The company shall work with stakeholders to develop
responsible laws, regulations and innovative programs that provide safeguards for
the community, the workplace and the environment while providing flexibility to
meet the needs of the business.

The company seeks a healthful and safe workplace, free of occupational injury
and illness. PDSEPI emphasize individual responsibility for safety by all
employees and at all levels of management.
The company expects employees to report potential safety hazards and issues, and
be involved in implementing solutions. To maintain a safe work environment,
employees are prohibited from possessing or using illegal drugs on PDSEPI
premises or reporting to work under the influence of illegal drugs or alcohol.

The company strives to conserve natural resources and reduce the environmental
burden of waste generation and emissions to the air, water and land. The company
shall strive to be leaders in reducing, reusing and recycling, and the company
expects employees to implement measures to properly dispose of any remaining
wastes in a safe and environmentally sound manner.

The company shall be a responsible member of the communities in which it live

and work. The company shall establish and maintain appropriate controls,
including periodic review, to ensure that this policy is being followed.

Strategic Alliances

PDSEPI shall seek strategic alliance with Local Government Units, NGO’s,
Barangay Officials, contractors and suppliers. The idea is to facilitate fast
issuance of permits and payments on any company to government business
transactions. Strong coordination with stakeholders shall not only promote good
communication but also provide smooth mobilization of resources from one area
to another.

22
 Description of the Service

General Policies and Strategies

The following general policies and strategies shall be implemented to address the
company’s services.

Effective access to basic services and development opportunities shall be enhanced

by:

1. Ensuring funding, operationalization and monitoring of allocated

budget.

2. Allocating resources to basic social services, such as basic

education and training, primary health care and nutrition, and
housing which have a greater impact on reducing poverty.

3. Targeting areas and population groups where social development

needs are greatest.

Harnessing the complementary roles of local government, the private sector, civil
society and the community in the development of human capabilities, through
principles of convergence, cooperation and teamwork.

Addition of more cost-effective social service delivery and financing mechanism.

This may include the provision of support directly to targeted vulnerable groups.

Strengthening the role of families and communities in addressing the needs of their
members, particularly in times of stress and crises brought about by societal
changes and modern living.

Seeking unity in diversity by respecting ethnicity while pushing for national unity.

Harnessing culture, the arts and media as the main vehicle for inculcating moral
principles in the people’s daily lives and targeting families as basic hints for
evolving national ideology.

Strengthening incentives and the systems of merits and rewards for persons and
organizations exemplifying virtue, professionalism, and societal contribution, so as
to create role models and leaders.

Health Care Services

1. The company shall focus on the prevention and control of leading
communicable, non-communicable and lifestyle related diseases as well as
conditions arising from environmental and occupational hazards.

23
 a. Construct enough hospitals and health care centers as
needed.
b. Invest in programs to address emerging health
problems
c. Allocate enough budgets for efficiently-managed health
promotion and disease prevention programs.
d. Set up of pharmaceutical centers in every Barangay to
act as primary source of affordable priced drugs. This
needs also an effective supply chain management of
drugs and medicine including its continuous delivery
and effective pricing mechanisms.

2. Upgrade the management infrastructure of public health offices.

a. Strengthening the field health offices and setting
partnership arrangements with local government units.
b. Assume availability of doctors, dentist and nurses and
midwifes in every Barangay Health Centers.
c. These health personnel shall be given above average
compensation and benefits.
d. Increasing people and community participation in health
and nutrition activities and decision making and
sustaining people’s health awareness through
intensified advocacy and information, education and
communication campaigns
e. Assisting government to promote for couples and parents
in achieving desired family size within the context of
responsible parenthood.

Education, Training, and Manpower Development Strategies

Adopting an effective fund mobilization scheme to ensure the adequacy of
financial support to all phases of education, training, priority programs and
institutions.
1. Widening the utilization of tested and cost effective non- conventional
/alternative learning strategies and delivery systems.
2. Improving the system of monitoring and evaluation by developing appropriate
and effective sets of performance indicators.
3. Integrating principles of human rights in all phases of training so as to mold
youth and future leaders to respect the dignity of every person regardless of
sex, dialect religion, political or other opinion, national or social origin,
property, birth or other status.
4. Develop the basic training structure and program adequate and responsive to
the requirements of the labor market and higher levels of learning.
5. Support the improvement of the teaching process and learning environment
and promote the use and gradual expansion of application of information
technology.

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Urban and Rural Poor Housing Strategies
1. Housing is both a component of social policy and instrument for economic
growth thus housing assistance is of paramount activity of the company.
2. Participating in proactive local urban planning will be pursued and observed
in coordination with key LGU’s.
3. The company shall identify and provide the housing needs of the beneficiaries
at a very minimal monthly amortization.
4. The company shall monitor and evaluate the construction performance up
until the house is awarded to the beneficiary.
5. The company shall also provide assistance and training in the post housing
development of the beneficiaries. This is to assure that proper house
maintenance know- how is given to all the beneficiaries.

Barangay Development
1. Promote community and social welfare interventions for the poor, vulnerable,
disadvantaged and marginalized sectors including children, youth, women,
persons with disabilities, indigenous peoples, victims of disasters, victim of
human rights violations , older persons, dysfunctional families and depressed
communities using the total family approach.
2. Adopting a total family approach to address sectoral concerns, through the
formulation of and advocacy for policies and programs to strengthen the
family.
3. Strengthening community based mechanisms such as the Barangay council for
the protection of children and the Barangay human rights action center for the
protection of the rights of the poor, vulnerable and disadvantaged sectors, and
their mobilization in actions against exploitation and abuse.
4. Strengthening the data base for monitoring the situation of the poor and
vulnerable groups.

PDSEPI shall deliver the following detailed services in the

province of Cavite:
A. Social Welfare Projects
1. Health Care Services in the Province

• One Health Center Bldg/Facilities per Barangay

• Health Care Support Programs
a. Information Campaign
b. Health Subsidy per family
• Barangay Botica
2. Housing Project (41,696 units)
• Site and Land Preparation
• House Construction
• Transfer to Site Monetary Assistance
• Support Facilities
3. Educational Services in the Province
• One ES/HS Bldg/Facilities per Barangay

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 • Education Subsidy for 2 college students per family
• Support Programs
o -Teachers Effectiveness
Training
o -Teachers Scholarships
Grants
4. Construction of Barangay Facilities
A. Barangay Halls Improvement
• Barangay Tanod Allowance
• Patrol Cars
B. Construction of Potable Water Systems per
Barangay
• Barangay Aqua Puro
C. Construction of Recreational Facilities per
Barangay
• Barangay Parks
• Youth and Senior Sports Facilities
5. Special Projects for Disabled and Needy
Persons per municipality and city
A. Disabled Persons
• Free Equipments for persons with handicap
• Medical Assistance for Special Treatment
B. Assistance to Senior Citizens per Barangay
o Food, Clothing and Personal
Allowance
o Death Assistance
6. Spiritual Development per Barangay
• Chapel Construction/Improvement
• Spiritual Materials
• Spiritual Training and Education
7. Environmental Projects in the Province
• Reforestation/Tree Planting
• Seedlings Bank
B. Economic Projects
1. Creation and Organization of Cooperatives per
municipality and city
• Credit Cooperative
• Consumer Cooperative
• Technical Support Facilities
2. Construction of Farm Irrigation Systems per
Agricultural Barangay
3. Livelihood Projects per Applicable Barangay
• Vegetable Farming
• Piggery and Poultry Raising
• Goat Raising

26
 • Fish Farming
• Food Processing
• Technical Education and Support
4. Farm to Market Roads for low income
Municipalities (see Appendix 4)
5. Agro-Industrial Projects per municipality
• Post Harvest Facilities
• Feed Mills
• Technical Education and Support
6. Tourism Projects in the province
• Eco- Tourism
• Resorts and Restaurants

Presently, PDSEPI is in the introductory stage. PDSEPI plans to follow the

services project plan and apply them to per Barangay per municipality and city in
the Philippines in the future. Initially PDSEPI will use the province of Cavite as a
starting point. Note that most of the organizers came from this province and
effective management and supervision are therefore can easily be initially
established. All challenges and resolutions that were experienced can be applied
to the next succeeding priority Philippine provinces.

Critical factors in the delivery of the services however are the availability of
qualified personnel, government bureaucracy and potential security and safety of
PDSEPI personnel especially in the remote Barangay areas.

Description of the Beneficiaries

The beneficiaries are the marginalized and the disadvantaged Filipino citizens
now living in Cavite. In 2007, they are estimated at 208,482 (8.6% of Cavite
population of 2.42 million (see Appendix 2). These people for a very long period
of time have been deprived of with some of the basics necessities in life in terms
of continuous availability of affordable foods, shelter, clothing, health care and
education.

The focus of PDSEPI therefore is to help these people improve their social and
economic lives by making them productive and increase their income, improve
their dignity and self esteem, and increase their faith in God and to their
fellowmen and thus enhancing their participation in nation building. Basic social
services will be delivered to them at affordable or no cost whichever is applicable
and at the same time giving them jobs for continuous self sustenance.

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 Management Structure

President

VP VP VP VP VP
Research,
HRD Finance and Operations Logistics Planning and
Accounting Development

The organizational structure is designed to meet all the stakeholders’ expectations

and the organization’s goals and objectives. The men and women of the
management team will be persons with high integrity, deep in working experience
and have wide exposure in leadership of people and resources. They will have a
combined minimum of twenty years of experience from different sectors of
society i.e. government, education, military, manufacturing and services.

Professional Support
The company will be supported by a high caliber corporate attorney and
professionals from well known accounting firm and management consulting firm.

Board of Directors
The BOD Team that will be invited and secured for assistance and support are
business and industry experts that will help in the decision making, strategizing,
and opportunity seeking process.

Operations Management
Operations Policy

The general policy of the company is to subject all major projects if applicable
and possible to outsourcing using the process of effective and honest bidding.
Later an E-procurement system (see Appendix 8) and an Integrated ERP System
(see Appendix 9) will be introduced and used to provide an efficient resources
management system. The company shall also use the latest communication

28
gadgets and computer/software technologies in other areas such as project
scheduling, human resource management and financial management to promote
efficiency and productivity.

Local available skilled and non- skilled workers shall be prioritized and utilized in
the construction of applicable projects. They shall be trained though with the
company’s core beliefs and philosophies to enhance quality of work output.

The principles of Just-in-Time systems(see Appendix 10) shall also be

implemented wherever it is applicable to minimize inventories. Just –in-time
purchasing shall be established with the suppliers to reduce operating cost and
encourage fast movement of materials, equipments and other needed supplies.

Fixed Capital Expenditures Budget Summary

Item Qty Unit Budget Total Budget

Php Php
Building Facility Equipments 1 set 18,000,000 18,000,000
Service SUV 33 1,500,000 49,500,000
Service Van 4 1,200,000 4,800,000
Elf Truck 3 2,500,000 7,500,000
Pick Up Truck 10 1,500,000 15,000,000
Lap Top Computer 29 75,000 2,175,000
Desk Top Computer 36 30,000 1,080,000
Steel Cabinet 29 10,000 290,000
Office Table/Chair 53 5,000 265,000
Cellular Phone 52 15,000 780,000
Landline Com/Bband Internet 1 set 50,000 50,000
Printer 4 35,000 140,000
Training Equipment 1 set 212,000 212,000
TV
LCD Projector
DVD Player
Amplifier
Audio Equipment
Photocopier 4 35,000 140,000
Auto CADD Plotter 1 50,000 50,000
Radio Communication 1 set 150,000 150,000
Conference Furniture 1 set 15,000 15,000
Canteen Equipments 1 set
Cashier 1 15,000 15,000
Gas tanks 1 5,000 5,000
Freezer 2 25,000 100,000
Gas Range 1 set 20,000 20,000

29
 Tables 15 2,000 30,000
Chairs 60 350 21,000
Cabinet 2 3,500 7,000
Working Table 3 3,000 9,000
Building and Warehouse 1 set 72,600,000
Total 172,939,000

Purchasing Policy

Purpose
Explains the various functions performed by Purchasing and general policies
concerning the purchase of all materials, supplies, equipment, and services.
Scope
Applies to all departments and activities.
Policy

1. Function of Purchasing Department.

The mission of Purchasing is to provide direct support to the mission of the

PDSEPI by assisting departments in obtaining products and services of a high
quality, at the lowest cost, and in the time needed. Purchasing achieves this
mission by processing and expediting orders in an efficient manner and the
highest ethical standards.

To fulfill this mission, the functions of Purchasing Services are as follows:

• To organize and administer a purchasing program for all departments and

activities.
• To communicate and interpret guidelines governing purchasing practice.
• To train employees in the preparation of electronic requisitions and to administer
this process.
• To provide the needed expertise on obtaining goods and services of the best
quality at the lowest prices.
• To dispose of all obsolete, used or surplus materials, supplies and equipment.

2. Compliance with Purchasing Guidelines.

All purchase transactions shall be made in strict compliance with the provisions as
listed in this policy. Any employee circumventing established purchasing
guidelines is subject to disciplinary action and may be held personally liable for
the amount of the transaction. When a department is non-compliant with the
purchasing procedure, a memorandum addressing the non-compliance will be sent
to the responsible department head and to the next higher authority.

30
 3. Purchasing Authority.
Authorization for purchases rests exclusively in Purchasing. Departments may not
purchase or contract without requisitioning the purchase of goods or services
through Purchasing.

4. Authority to Question Quantity or Quality.

Purchasing has the responsibility and full authority to question the quantity,
quality, and kind of material requested by departments so that the best interests of
the company may be served.

5. Contracts/Competitive Bidding.

• Many items are under contract and must be obtained from specified vendors.
• Other items, due to cost, must be obtained under a competitive bid process by
Purchasing.

6. Service Contracts/Maintenance Agreements.

A service or maintenance contract is initiated by submitting a requisition to the
Purchasing Department. The Purchasing Manager must sign all maintenance
contracts.

The Purchasing Department obtains Service contracts for most office and support
equipments. Once equipment is covered on a maintenance contract, service
requests should be referred to the vendor for prompt response.

7. Sole Source Purchases.

On some highly technical items, there shall be only one known source. A sole
source justification for a purchase of this type of item without competitive bidding
shall accompany the procurement request. The sole source justification form shall
be forwarded to the VP Logistics for approval and should give the following
information:

1. Name and address of the suggested supplier.

2. Technical specifications that make the equipment unique.
3. Names and addresses of other vendors that make similar equipment, and details of
the ways such equipment fails to meet required specifications.

8. Contract with Consultants.

The definition of consultants means work or task(s) performed by independent
contractors possessing specialized knowledge, experience, expertise and
professional qualifications to investigate assigned problems or projects and to
provide counsel review, analysis or advice in formulating or implementing
improvements in programs or services. This includes but is not limited to the
organization, planning, directing, control, evaluation and operation of a program,
agency; or department.

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 Before receiving authorization to seek consultant services, Departments Head
shall submit to and contract written justification for its request for consultant
services. This written justification shall at a minimum explain:

• What services the Department desires to secure

• Why the work to be performed by the consultant cannot be reasonably
accomplished by employees of the requesting Department
• How the work to be performed relates to the proper functions of the Department
• What benefits the Department expects to receive from the consultant’s services
• What the Department estimates to be the cost of the services sought and what
budget will be used for this service
• What potential sources of consultant services, if any, the Department has
identified

9. Contractual Arrangements.
All contractual arrangements for goods and services must be reviewed and
approved by the VP Logistics

10. Conflict of Interest.

• Departments shall not make purchases from individuals employed by the

company.
• In addition, employees shall not use the purchasing power of the company for
personal advantage.
• Any transaction that may appear to be for individual personal gain, (as determined
by Purchasing) must have approval from the president before the transaction shall
be completed.

11. Receipt of Gifts and Favors from Contractors or Suppliers.

It is unlawful for any contractor, subcontractor, or supplier:

to make gifts or favors to PDSEPI employees charged with the duty of:

• Preparing plans, specifications, or estimates for project contracts, or

• Awarding or administering contracts, or
• Inspecting or supervising construction.
• Any activity of the same nature defined above

Likewise, it is unlawful for employees to willfully receive or accept gifts or favors

from such contractors, subcontractors, or suppliers.

Exclusion: This policy on gifts and favors is not intended to prohibit:

• Advertising items or souvenirs of nominal value

• Meals furnished at banquets

32
• Donations to professional organizations to defray meeting expenses
• Participation by PDSEPI employees and officers who are members of
professional organizations in any scheduled meeting functions available to all
members of the professional organization attending the meeting
• Customary gifts and favors between PDSEPI employees or officers and their
friends and relatives (or friends and relatives of their spouse, minor children, or
household members) when the personal relationship rather than business is clearly
the motivating factor for the gift or favor.

However, an employee who knowingly receives such gifts or favors must report it
to his or her Purchasing Manager if a contractor, subcontractor, or supplier-doing
business directly or indirectly with the company made the gifts.

12. Company Visits by Salespersons.

• Salespersons may visit departments only upon prior approval by Purchasing of the
vendor's visit. Salespersons visiting departments without purchasing approval
shall be directed to Purchasing Department.
• Approved visits shall be scheduled by Purchasing, with ample notification to the
department..

13. Equipment Demonstration and Loans.

Departments must obtain prior approval from Purchasing Department for
equipment demonstrations or equipment loans. Departments may not accept
goods on consignment, pending the issuance of a confirming purchase order.

14. Correspondence with Vendors.

Once a purchase order has been transmitted to a vendor, all correspondence
concerning the purchase is to be handled by Purchasing Department. When the
technical details involved make it advisable to delegate authority to others, the
Purchasing Department must receive copies of all correspondence.
15. Complaints of Vendor Performance.
Departments shall direct all complaints of vendor performance or service to the
Purchasing Manager via a memorandum. The memorandum should include the
following:

• Purchase order number

• Full name of the vendor
• Date of the purchase order

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 Human Resource Management

Human Resource Policy

Workplace Environment

While maintaining a work culture that ensures PDSEPI success, the company
shall also strives to treat each employee fairly and with dignity. Consistent with
this principle, PDSEPI seeks to:

•Reward individual performance through meritocracy-based compensation

practices
•Create opportunities for advancement and growth, and an environment that
allows employees to continuously improve and expand their skills
•Provide market competitive compensation and a pay structure that allows
employees to share in company’s success
•Promote open communication and prompt resolution of employee issues
•Provide a safe and secure work environment for all employees.

In addition, PDSEPI is committed to complying with all applicable laws.

pertaining to employees. This includes laws regarding: minimum ages for
employment; minimum wages and overtime compensation; benefits;
discrimination and affirmative action; employees’ right to raise issues and work
collectively for their mutual benefit; and health and safety.

Diversity & Equal Opportunities

Diversity

At PDSEPI, regional diversity is an essential ingredient of innovation and

excellent business performance. The wide-ranging perspectives, abilities, and
experiences of workforce are important to the success of the company. The
company respects, value, and celebrate the unique points of view and
opportunities that come with diversity in employees, communities, beneficiaries,
and suppliers.

Equal Opportunities

PDSEPI provides equal opportunities for all applicants and employees without
regard to non job-related factors such as religion, gender, national origin,
ancestry, age, disability, veteran status, marital status, sexual orientation or gender

34
identity. This principle applies to all areas of employment, including recruitment
and hiring, training, performance evaluations, promotions and transfers,
compensation and benefits, and recreational programs.

Consistent with this, PDSEPI is committed to maintaining a workplace free from

harassment of any kind, including harassment based on an employee’s, religion,
gender, national origin, ancestry, age, disability, veteran status, marital status,
sexual orientation or gender identity. PDSEPI will take immediate action to
address harassment of employees engaged in by managers, co-workers, or non-
employees when the harassment occurs in the workplace or in the course of an
employee’s work.

Harassment includes any behavior that creates an intimidating, offensive or

hostile work environment for an employee. Sexual harassment includes behaviors
such as: making unwelcome sexual or romantic advances, requests for sex,
touching another employee in an unwelcome sexual manner, displaying graphic
sexual photos or written material, and sharing sexual jokes. Examples of other
harassing behaviors include: making disparaging an employee because of her sex,
condemning an employee’s religious beliefs, or ridiculing an employee because of
his or her disabilities.

Human Rights

PDSEPI is committed to complying with all applicable laws regarding employees’

welfare. This includes laws regarding: minimum ages for employment; minimum
wages and overtime compensation; benefits; discrimination ; employees’ right to
raise issues and work collectively for their mutual benefit; and health and safety..
All employees are required to participate in training regarding human rights and
the company’s business principles.

Meritocracy& Continuous Improvement

Meritocracy is an integral part of PDSEPI compensation philosophy that rewards

performance and emphasizes continuous improvement. PDSEPI meritocracy
system ties individual pay changes, promotion opportunities, and stock options to
individual performance.

PDSEPI formally appraises the performance of employees every year. The

evaluation provides the employee with a documented review of performance and
may result in a change in compensation. Employee performance is measured
against factors such as individual performance expectations, departmental and/or
corporate business objectives, team performance, performance relative to peers,
and performance to PDSEPI values. Input on performance may be gathered from
many sources, including managers, peers, subordinates and customers.

Remaining competitive requires that PDSEPI employees strive for continuous

35
improvement in their individual performance. PDSEPI encourages employees to
own their own employability by maintaining and developing useful and
marketable skills. In addition, managers are encouraged to assist employees in
career development.

Competitive and Variable Compensation

PDSEPI total compensation approach responds to the cyclical nature of the
business. This philosophy is based on creating a pay structure that the company
can maintain in down cycles while being among the best paying in good times.
This is accomplished through a combination of base pay, benefits and variable,
profit-driven components such as cash bonus and preferably stock options.

Employee Career Development and Management

When company succeeds, the employees share in that success. At the same time,
the company recognizes that employee development lays the foundation for the
success in the first place. For this reason, PDSEPI provide a broad range of
benefits to meet a spectrum of needs.

Manager-Subordinate Relationships
Romantic and sexual relationships between managers and subordinates can
damage workgroup morale, create perceptions of favoritism, and lead to claims
for sexual harassment, retaliation and wrongful termination. Consequently, every
manager is prohibited from pursuing romantic or sexual relationships with
employees in his or her direct, indirect or matrix management chain. A manager
who nevertheless becomes involved in such a relationship has an obligation to
disclose the relationship to his or her manager and Human Resources. If the
relationship is disclosed immediately and before it has negatively impacted the
work group, PDSEPI generally will work with the manager to attempt to modify
the reporting relationship. Failing to raise the issue, or continuing to maintain the
relationship, will result in disciplinary action, including termination.

Open Communication
PDSEPI promotes a free flow of thoughts, ideas, and questions throughout the
company. Employees are encouraged to challenge the status quo and decision
makers are encouraged to listen to all ideas and viewpoints. Employees are
empowered to raise questions and discuss issues directly with their manager and
work team.

PDSEPI also encourages prompt resolution of individual employee concerns

through its Open Door process. The Open Door is company’s process for
addressing issues raised by employees. Through the Open Door, employees may
raise any work-related concern at any time and expect the concern to be addressed
in a prompt, confidential, and honest manner. The types of concerns commonly
raised through the Open Door include:
•Questions about the application of a PDSEPI guideline, Corporate Business
Principle, or company Value.

36
 •Concerns about discipline received by the employee, or inappropriate behavior
engaged in by a peer, manager or customer.

An employee may raise a concern with whomever he or she thinks can best
address it. PDSEPI encourages, but does not require, employees to raise concerns
with their direct manager first. An employee may raise a concern with any
manager (such as a department head), a member of the Human Resources group,
or the Executive Office.

Assets Protection and Use of Company Resources

Every PDSEPI employee is responsible for protecting company’s assets. PDSEPI
assets include, but aren’t limited to, physical assets, such as equipment and
buildings, as well as company’s funds, and intellectual property such as
company’s secrets and confidential information.

To protect the company’s assets, they must be adequately safeguarded. This

means locking up and securing valuable assets where appropriate. PDSEPI assets
may not be sold, borrowed, lent, disclosed, given away or modified in any way
that would impair their value, unless there is a good business reason and with
approval of the department manager. Anyone entering an company’s facility is
required to wear and openly display an PDSEPI-issued identification badge, and
follow all entry procedures. All badges are the property of PDSEPI and must be
returned on termination and upon request.

Each employee is also responsible for understanding company's obligations for

protecting assets that have been entrusted to it by suppliers, and for treating them
accordingly.

Company resources, including, but not limited to, cash, personnel, equipment and
vehicles can only be used for legitimate company business purposes. PDSEPI also
provides employees with use of company-owned telephones, copiers and
computer equipment to be used as a resource in conducting business. Although
reasonable personal use of these resources is permitted, such use is not private, is
subject to review and access by PDSEPI, and is governed by the professional
conduct and reasonable use expectations.

Department Functions

Office of the President

Responsible for the policies, administration, control, and operations of the

functions, programs, and affairs of the company.

Assures that all the policies, programs and activities of the company are effectively
executed and implemented in the most economical manner without any hindrance
and prejudice to the beneficiaries.

37
Designates and assigns the most qualified personnel to be deployed as executives of
the company.

Allocates and approves funds in the effective supervision and deployment of social
and economic projects and services.

Office of VP HRD

Provides stable employment, equitable compensation, desirable working conditions

and opportunities for advancement for employees in return for their skill, care,
effort, dependability, and teamwork.

Provides a climate conducive to the development of each employee in accordance

with his needs, interests, desires, abilities, and willingness to take on additionally
responsibility.

Manages the human resource department to ensure continuing vitality thru

personnel welfare and benefits.

Provides continuing education training to executives, managers, engineers,

supervisors, and all technical personnel to continuously update their knowledge,
attitudes and skills in the practice of their of specialization.

Defines clearly for each individual the responsibilities of his position to enable him
to make his best contribution to overall organizational goals.

Office of VP Finance and Accounting

Responsible for the preparation and implementation of the effective financial plan
to support the company’s programs, activities, projects and ensures the efficient and
economical management with relevant information and advice on the evaluation
and analysis of the operating performance of various department of the company.

Assures the management of the internal financial and administrative affairs of the
department.

Coordinates and disposes all forms of financial needs to the department whether in
cash or in kind.

Examines and evaluates the adequacy and effectiveness of internal control within
the department.

Provides centralized accounting services for the center including control and
certification of funds and review and scheduling of disbursements, including
issuance, receipts, of checks and bonds.

38
 Office of VP Operations

Generally responsible in the planning, design, directing, coordinating and

controlling the operations of the area under his responsibility.

The duties include formulating policies and guidelines in managing daily operations
and implementation in the use of resources that are vital and important in his area.

Assures that approved budget is effectively allocated and all other resources are
used properly and the programs are carried as planned.

Implements and use all tools available to assure effectiveness in the disseminations
of all projects thus enhancing people’s awareness.

Undertakes advocacy undertakings to promote social change and nurture its

relationship with different stakeholders.

Plans, directs, supervises and coordinates activities and personnel concerned in the
construction of housing, economic, education, and health facilities.

Office of VP Logistics

In –charge of the procurement of goods and services for the company. This includes
safekeeping and custody of all procurement documents.

Integrates distribution, transportation and warehousing all materials, equipments,

machines and tools in the facilitation of projects, construction and programs
implementation.

Coordinates with project managers in the proper allocation and use of all
department materials, supplies, tools, machines, and equipments.

Initiates effective automation of resources planning using the latest software

available in the market.

Office of VP Research, Planning and Development

Leads in the formulation and development of policies, plans, programs, and projects
in the field of socioeconomic projects.

Implements and facilitates the assessments, generation, processing and packaging of

data and reports and the presentation/dissemination of these to end users.

Develops and maintains standards and procedures on information technology.

39
Develops and implements training criteria, standards, and capability building
programs for department personnel.

Conducts research, studies, and special projects in the field of social and economic
programs.

Promotes and maintain linkages with international agencies for technical

cooperation in coordination with other departments.

Formulates operational programs and special projects in the field of socio-economy

including conceptualization, development, management and operations of key or
flagship projects.

Responsible for the development of quality assurance measures and regulates the
implementation of socioeconomic policies, rules and regulations.

Manpower Summary

Position Requirements
President 1
Vice President 5
Asst Vice President 2
Corporate Attorney 1
Manager 23
Supervisor 6
Engineer 13
Executive Secretary 1
Technical Assistant 37
Department Secretary 23
Clerk I 14
Clerk II 27
Driver/Messenger 17
Helper 60
Janitor 5
Total 235

Risk/Opportunity
The risks that PDSEPI is seeing in the implementation of this project is the
continuous increase in the price of petroleum products that will affect the
operating cost in the management of the various social and economic projects.
PDSEPI needs to continuously formulate effective strategies and action plans to
face these challenge. Another risk is the continuous transfers of squatters from

40
Metro Manila to Cavite.To compensate this, an average population rate of 5.45%
was considered in the computation.

Fortunately, the continuous improvement of peso over the dollar will reduce the
cost of importing equipment, machineries, materials and technologies needed in
the effective operations of PDSEPI. The project is also seen to minimize if not
eliminate social problems in Cavite in the future.

Capital Requirements
PDSEPI is seeking 91.86 billion pesos worth of financing which will enable the
company to provide and deliver the vital services and the economic- based
projects that the company believes will enhanced the quality of lives of the
beneficiaries. Note that some of the generated income will be subjected to money
income investments so as to continue maximizing the return and thus continue the
financing of socio-economic projects as well as for the new projects that will be
developed. The income from this investment program will be used also to
promote sustainability of PDSEPI.

The initial stage of funding will be used to complete land, building and facilities
construction, purchase fixed capital equipment, enhance service social marketing,
and fund the needed pre-operating and working capital. Here is a breakdown of
how the funds will be spent;

Complete facilities development Php 215.30 M

Purchase operating capital equipment and supplies Php 9,877.10 M
Fund pre-operating and working capital Php 12.6 M

41
 Financial Evaluation

A. Assumptions
The following cost analysis and projections assume the following;

a. U.S. Dollar to Peso Exchange Rate:

$ 1= Php 40.25
b. Target Families:41,696
c. Number of Cavite Barangays:829
d. Number of Cities:3
e. Number of Municipalities:20
f. Number of Districts:3
g. Inflation Rate: 2.0 %
h. Average Annual Population
Increase: 5.45%

B. Social and Economic Projects Budget Plan

Social Welfare Projects Unit Budget (Php) Total Budget (Php)

1. Health Care Services in the

Province
One Health Center Bldg/Fac. per 7,500,000 6,217,500,000
Barangay
Health Subsidy per family 50,000 2,084,800,000
Barangay Botica 1,750,000 1,450,750,000
2. Housing Project (41,696 650,000 27,102,400,000
units)
Site and Land Preparation
House Construction
Support Facilities
3. Educational Services in the
Province
One HS Bldg/Facilities per 27,500,000 22,797,500,000
Barangay
Educational Subsidy 360,000 2,995,200,000
(8320)students for college
Education and Cultural Programs 1,500,000 1,243,500,000
-Teachers Effectiveness Training
-Teachers Scholarships Grants
One ES Bldg/Facilities per 18,000,000 14,922,000,000
Barangay
4. Construction of Barangay
Facilities

42
A. Barangay Halls Improvement 750,000 621,750,000
Barangay Tanod Allowance 100,000 82,900,000
Patrol Cars 350,000 290,000,000
B. Construction of Potable
Water Systems per Barangay
Barangay Aqua Puro 650,000 538,850,000
C. Construction of
Recreational Facilities per
Barangay
Barangay Parks 1,500,000 1,243,500,000
Youth and Senior Sports 350,000 290,000,000
Facilities
5. Special Projects for Disabled
and Needy Persons per
municipality and city
A. Disabled Persons
Free Equipments for persons 450,000 10,350,000
with handicap per
municipality/city
School Facilities for Disabled 2,500,000 7,500,000
Persons per District
Medical Assistance for Special 350,000 8,050,000
Treatment per Municipality/City
B. Assistance to Senior Citizens 200,000 165,800,000
per Barangay
Food, Clothing and Personal
Allowance
Death Assistance
6. Spiritual Development per 350,000 290,150,000
Barangay
Chapel
Construction/Improvement
Spiritual Materials
Spiritual Training and Education
7. Environmental Projects in the
Province
Reforestation/Tree Planting 1,800,000 592,200,000
Seedlings Bank 350,000 115,150,000

Total 68,147,850,000
B. Economic Projects
1. Creation and Organization of
Cooperatives per Barangay
Credit Cooperative 1,500,000 1,243,500,000

43
Consumer Cooperative 1,500,000 1,243,500,000
Technical Support Facilities 350,000 290,150,000
2. Construction of Farm 6,000,000 1,974,000,000
Irrigation Systems (329
Agricultural Barangay)
3. Livelihood Projects per
Barangay
Vegetable Farming(329 500,000 164,500,000
Barangay)
Piggery/Poultry Raising 750,000 246,750,000
Goat Raising 450,000 148,050,000
Fish Farming (213 Barangay) 750,000 159,750,000
Food Processing 750,000 246,750,000
Technical Education and Support 750,000 246,750,000
4. Farm to Market Roads for low 50,000,000 650,000,000
income
13Municipalities(Appendix 3)
5. Agro-Industrial Projects for
13 municipality
Post Harvest Facilities 3,500,000 45,500,000
Feed Mills 2,500,000 32,500,000
Technical Support 350,000 4,550,000
6. Tourism Projects per District
Eco- Tourism 7,500,000 22,500,000
Resorts and Restaurant 15,000,000 45,000,000
Total 6,178,750,000
Socio-Economic Total 74,326,600,000
Contingency (10%) 7,432,266,000
Sub Total 81,759,260,000

C. Socio- Economic Projects Annual Revenue

Socio-Economic Projects Budget Php Annual Revenue at

10% ROI Php
Housing Revenue 27,102,400,000 108,409,600
41,696 units (36 sq. meter
area)
650,000 pesos/unit
25 years to pay(2166
pesos/mo)
Barangay Aqua Puro 538,850,000 53,885,000
829 Barangays

44
650,000 Pesos each System
Credit Cooperative 1,243,500,000 124,350,000
829 Barangays
Consumer Cooperative 1,243,500,000 124,350,000
829 Barangays
Farm Irrigation 1,956,000,000 195,600,000
329 Barangays
Fish Farming 159,750,000 15,975,000
Vegetable Farming 164,500,000 16,450,000
329 Barangays
Piggery/Poultry Raising 246,750,000 24,675,000
329 Barangays
Cattle/Goat Raising 148,050,000 14,805,000
329 Barangays
Food Processing 246,750,000 24,675,000
829 Barangays
Post Harvest Facilities 45,500,000 4,550,000
Rental
329 Barangays
Feed Mills 32,500,000 3,250,000
329 Barangays
Resort/Restaurant 45,000,000 13,500,000
per District
Eco -Tourism 22,500,000 2,250,000
On Applicable Municipalities
Barangay Botica 1,450,750,000 145,075,000
Total Php 34,646,300,000 871,799,600

D. PDSEPI Fixed Capital Operating Budget

Items Qty Unit Budget Total Budget

pc Php Php
Office of the President
Service SUV Vehicle 1 1,700,000 1,700,000
Lap Top Computer 2 75,000 150,000
Executive Table/Chair 2 15,000 30,000
Desktop Computer 2 30,000 60,000
Steel Filing Cabinet 2 10,000 20,000
Office Table /Chair 2 5,000 10,000
Executive Furniture 2 10,000 20,000

45
 Cellular Phone 2 25,000 50,000
White Board 4 by 6 ft. 1 3,000 3,000
Printer 1 35,000 35,000
Interior Decoratives 1 15,000 15,000
Office Supplies (set) 1 10,000 10,000
Conference Room Furniture 1 75,000 75,000
and Equipment
Office of VP HRD
Service SUV Vehicle 5 1,500,000 7,500,000
Lap top Computer 4 75,000 300,000
Executive Table/Chair 4 15,000 60,000
Desktop Computer 5 30,000 150,000
Steel Filing Cabinet 4 10,000 40,000
Office Table/Chair 5 5,000 25,000
Cellular Phone 4 25,000 100,000
Printer 1 35,000 35,000
LCD Projector w/ Screen 3 50,000 150,000
Television for Training 2 25,000 50,000
DVD Player for Training 4 3,000 12,000
Office Table/Chair 1 5,000 5,000
Canteen Equipments
Tables 15 1,500 22,500
Chairs 60 350 21,000
Freezer 2 25,000 50,000
Cooking Equipments(set) 1 20,000 20,000
Cashier Equipment 1 15,000 15,000
Gas Tanks for Cooking 1 5,000 5,000
Photo Copier 1 30,000 30,000
Training Furniture
Table/Chair 10 5,000 50,000
White Board 4 by 8 ft. 4 3,000 12,000
Documents Cabinet 2 15,000 30,000
Office Forms and 1 10,000 10,000
Supplies(set)
Contingencies 10% 869,250
Office of VP Finance and
Accounting
Service SUV Vehicle 4 1,500,000 6,000,000
Lap Top Computer 3 75,000 225,000
Executive Table /Chair 3 15,000 45,000
Steel Filing Cabinet 3 10,000 30,000
Office Table/Chair 6 5,000 30,000
Printer 1 35,000 35,000
Desktop Computer 6 30,000 180,000
White Board 4 by 8 ft 2 3,000 6,000

46
Office Forms and Supplies 1 10,000 10,000
Photo Copier 1 30,000 30,000
Contingencies 10% 659,100
Office of VP Operations
Service Vehicle 17 1,500,000 25,500,000
Lap Top Computer 14 75,000 1,050,000
Executive Table /Chair 16 15,000 240,000
Steel Filing Cabinet 14 10,000 140,000
Office Table/Chair 28 5,000 140,000
Printer 1 35,000 35,000
Desktop Computer 14 30,000 420,000

Auto CADD Plotter 1 50,000 50,000

White Board 4 by 8 ft. 14 3,000 42,000
Office Forms and Supplies 1 10,000 10,000
Radio Equipments(set) 1 150,000 150,000
Satellite Furniture/Equipments 23 50,000 1,150,000
Pick-Up Trucks 7 1,500,000 10,500,000
Service Van 4 1,200,000 4,800,000
Contingencies 10% 4,422,700
Office of VP Logistics
Service SUV Vehicle 3 1,500,000 4,500,000
Lap Top Computer 3 75,000 225,000
Executive Table/Chair 3 15,000 75,000
Steel Filing Cabinet 3 10,000 30,000
Office Table/Chair 6 5,000 30,000
Desktop Computer 6 30,000 180,000
Office Forms and Supplies 1 10,000 10,000
Elf Truck 3 2,500,000 7,500,000
Pick-Up Truck 2 1,500,000 3,000,000
Initial Project Supplies 1 5,000,000 5,000,000
Contingencies 10% 2,055,000
Office of VP Research,
Planning and Development
Service SUV Vehicle 3 1,500,000 4,500,000
Laptop Computer 3 75,000 225,000
Executive Table Chair 3 15,000 75,000
Steel Filing Cabinet 3 10,000 30,000
Office Table Chair 6 5,000 30,000
Desktop Computer 3 30,000 90,000
Printer 1 35,000 35,000
ERP Software 1 750,000 750,000
Business Software 2 250,000 500,000
White Board 4 by 8 ft 2 3,000 6,000
Office Forms and 1 10,000 10,000

47
Supplies(set)
Pick-Up Truck 1 1,500,000 1,500,000
Contingencies 10% 775,100
Total 9,877,065,000

E. PDSEPI Building/Facilities Budget

Items Qty (pc) Unit Budget Total Budget

(Php) (Php)
a. Land /Devt (15,000 sq. meter) 1 4,000 60,000,000
b. Building (2,500 sq. meter) 1 18,000 45,000,000
c. Building Facilities (40% of 1 18,000,000
Bldg)(Water/Electrical/AC/Com
d. Parking/Maintenance Bay( 1 5,000 7,500,000
1500 sq. meter)
e. Sports Facilities(1000 sq. 1 5,000 5,000,000
meter)
f. Canteen Facilities(300 sq. 1 12,000 3,600,000
meter)
g. Warehouse(2000 sq. meter) 1 12,000 24,000,000
Contingency (20%) 35,882,000
Total 215,292,000

F. PDSEPI Pre-Operating Budget

Items Budget Php

Pre-Investment Studies/Investigations 350,000
Pre-Project Capital Eqpmt- A/C, Water, 1,500,000
Communication, Office Furnitures/Eqpmt
Recruitment and Training 2,500,000
Legal Permits 500,000
Initial Working Capital 5,350,000
Cash on Hand 1,000,000
Salaries and Wages 3,000,000
Office Rental 600,000
Gasoline, Electricity and water 350,000
Office Supplies 50,000
Kick- off Budget 350,000
Contingency (20%) 2,040,000
Total 12,640,000

48
G. PDSEPI Manpower Budget

Position Classification Qty Monthly Salary Annual Budget

(Php) (Php)
Office of the President

1. President 1 500,000 6,000,000

2. Executive Secretary 1 55,000 660,000
3. Corporate Attorney 1 200,000 2,400,000
4. Clerk I 2 35,000 840,000
5. Driver/Security 2 30,000 720,000
Total 10,620,000

Office of VP HRD

1. VP HRD 1 350,000 4,200,000

2. Secretary to the VP 1 45,000 540,000
3. Employment Manager 1 200,000 2,400,000
4. Secretary to the EM 1 40,000 480,000
5. Recruitment Supervisor 1 75,000 900,000
6. Clerk II 2 30,000 720,000
7. Compensation/Benefits 1 75,000 900,000
Supervisor
8. Clerk II 2 30,000 720,000
9. Personnel Relations 1 200,000 2,400,000
Manager
10. Secretary to the PRM 1 40,000 480,000
11. Employee Relations / 1 75,000 900,000
Security Supervisor
12. Clerk II 2 30,000 720,000
13. Training/Development 1 75,000 900,000
Supervisor
14. Clerk II 2 30,000 720,000
15. Facilities Manager 1 200,000 2,400,000
16. Secretary to the FM 1 40,000 480,000
17. Building Maintenance 1 75,000 900,000
Supervisor
18. Technical Asst I 3 50,000 1,800,000
19. Helper/Janitor 10/5 20,000 3,600,000
20. Equipment 1 75,000 900,000
Maintenance Supervisor
21. Technical Asst. I 5 50,000 3,000,000
22. Driver/Messenger 3 25,000 900,000
Total 30,960,000

49
Office of VP Finance and
Accounting
1.VP Finance and 1 350,000 4,200,000
Accounting
2. Secretary to the VP 1 45,000 540,000
3. Finance Manager 1 200,000 2,400,000
4. Secretary to the FM 1 40,000 480,000
5. Clerk I 1 35,000 420,000
6. Clerk II 2 30,000 720,000
7. Accounting Manager 1 200,000 2,400,000
8. Secretary to the AM 1 40,000 480,000
9. Clerk I 5 35,000 2,100,000
10. Driver/Messenger 1 25,000 300,000
Total 14,040,000
Office of VP Operations

1. VP Operations 1 350,000 4,200,000

2. Secretary to the VP
3. AVP Operations 2 275,000 6,600,000
4. Secretary to the 2 40,000 960,000
AVP
5. Project Manager 13 200,000 31,200,000
6. Secretary to the 13 40,000 6,240,000
PM
7. Engineering Manager 1 200,000 2,400,000
8. Secretary to the 1 40,000 480,000
EM
9. Technical Engineer 13 75,000 11,700,000
10. Technical Asst I 26 50,000 15,600,000
11. Clerk II 15 30,000 5,400,000
12. Driver 7 25,000 2,100,000
13. Helper 50 20,000 12,000,000
Total 98,880,000

Office of VP Logistics
1. VP Logistics 1 350,000 4,200,000
2. Secretary to the VP 1 40,000 480,000
3. Purchasing Manager 1 200,000 2,400,000
4. Secretary to the PM 1 40,000 480,000
5. Warehouse Manager 1 200,000 2,400,000
6. Secretary to the 1 40,000 480,000
WM
7. Warehouse Supervisor 2 75,000 1,800,000
8. Clerk I 6 35,000 2,520,000

50
 9. Driver 3 25,000 900,000
10. Helper 10 20,000 2,400,000
Total 18,060,000

Office of VP Research,
Planning and Development
1. VP Research, Planning 1 350,000 4,200,000
and Development
2. Secretary to the VP 1 40,000 480,000
3. Research and Planning 1 200,000 2,400,000
Manager
4. Project Development 1 200,000 2,400,000
Manager
5. IT Engineer 2 75,000 1,800,000
6. Technical Asst I 3 50,000 1,800,000
7. Clerk I 2 35,000 840,000
8. Clerk II 2 30,000 720,000
9.Driver 1 25,000 300,000
Total 14,940,000
Sub Total 187,500,000

G. Projected Variable Operating Expenses

For the Years 2009 through 2012

Operating 2009 2010 2011 2012

Expense
Salaries and Wages 131,250,000 187,500,000 206,250,000 226,875,000
13th month pay 10,937,500 15,625,000 17,187,500 18,906,250
Employees Welfare 22,610,400 24,871,440 27,358,584 30,094,442
and Benefits
SSS, Medicare and 4,987,500 4,987,500 5,486,250 5,486,250
Insurance Premiums
Medicare and 11,950,000 11,950,000 13,145,000 13,145,000
Hospitalization
Food and Supplies 119,500 119,500 131,450 131,450
Subsidy
Representation and 3,408,000 3,408,000 3,748,800 3,748,800
Entertainment
Transportation and 19,034,000 19,034,000 20,937,400 20,937,400
Travel
Consultant/Prof. Fees 5,000,000 5,000,000 5,000,000 5,000,000
Recreation and 2,000,000 2,000,000 2,000,000 2,000,000
Excursion
Supplies and 3,600,000 3,780,000 3,969,000 4,167,450
Stationeries
Study, Research and 5,000,000 6,050,000 6,655,000 7,320,500

51
Devt
Repairs and 3,500,000 3,850,000 4,235,000 4,658,500
Maintenance
Gas, oil and Lubricant 2,500,000 3,000,000 3,600,000 4,320,000
BOD Fees 525,000 575,500 635,250 698,775
Membership Dues 100,000 100,000 100,000 100,000
Housing Benefits 1,892,000 2,270,400 2,724,480 3,269,376
Utilities, power, 18,000,000 21,600,000 25,920,000 31,104,000
communication, and
water
Social Advertising 1,500,000 1,500,000 1,500,000 1,500,000
Depreciation 24,286,824 24,286,824 24,286,824 24,286,824
Permits and Licenses 1,500,000 1,000,000 750,000 500,000
Seminars and 2,000,000 2,000,000 2,500,000 2,500,000
Conferences
Security Services 750,000 825,000 907,500 1,000,000
Taxation 10,500,000 10,500,000 10,500,000 10,500,000
Miscellaneous 1,500.000 1,500,000 1,500,000 1,500,000
Expenses
Total 288,450,724 357,332,764 391,027,238 423,750,017

Project Timetable
Activity Target Completion

PDSEPI Project Study Approval June 2008

Budget Release June 2008

Building/Facilities Construction November 2008

Executives Recruitment July 2008

Manpower Recruitment/Training October 2008

Kick-Off December 2008

Start -Up Operation January 2009

Conclusion
Both the PDSEPI operation and the 13 socio-economic projects will need a total
of 91.86 billion pesos investment. It will also require 6 months to construct and
faciliticized its building and support facilities. Major start-up operation will start
on the first week of January 2009.

52
 Appendix

1. Analysis of Social Developments

Poverty

The Philippines has achieved a modest reduction in poverty incidence from 27.5%
in 2000 to 24.7% in 2004, when approximately 30 million people were living
below the poverty line. Poverty is multifaceted in the Philippines and includes
deprivation of access to five essential assets: financial, human, natural, physical
and social. There continue to be wide geographic disparities in poverty
distribution across and within the different regions in the country and between
rural and urban areas, with the highest incidences of poverty found in Mindanao
and in the Cordilleras. There are also persisting income inequalities between rich
and poor, which confirm that overall economic growth has not been broad-based
and pro-poor..

Indigenous communities are among the poorest in the country and depend on
resources for their basic livelihoods. In Mindanao, violent conflict is linked in part
to grievances over access to and control over natural resources. Some investments
(both public and private) in resource-intensive mining, fishing, energy and forest
industries have degraded and diminished available resources, displaced segments
of the population and disrupted the social fabric of indigenous communities. This
has exacerbated tensions, notably between competing clans, and has given a
specific environment-conflict dimension to poverty.
.
Health

Health conditions have improved somewhat since the 1990s, as shown by the data
on infant and child mortality rates, maternal mortality rates, life expectancy,
malnutrition prevalence, and the prevalence of selected diseases such as malaria,
tuberculosis and HIV/AIDS. The children under-five and infant mortality rates
dropped from 80 (out of 1000) in 1990 to 40 in 2003 and from 57 in 1990 to 29 in
2003. Similarly, maternal mortality rate (MMR) also declined from 280 per
100,000 live births in 1990 to 172 per 100,000 live births in 2000, which is still
higher than the rates of some of its neighbours in the region. Access to quality
health services continues to be a major problem in many regions as health service
delivery suffers from budgetary cuts. The latest National Demographic Survey,
for instance, shows an increase in the number of unvaccinated children. The
number of married women using modern contraceptive methods rose to a still low
33% compared to just 25% in 1993 (GoP surveys only cover married women of
reproductive age) and close to 24% of family planning needs remain unmet due to
the lack of an active population control policy.

53
The rising brain drain of health professionals – the Philippines is the first exporter
of nurses and the second of doctors worldwide – negatively impacts upon the
quality of health services. Health financing and social protection coverage is
inequitable, with a heavy financial burden on households, especially the poor and
ethnic minorities. The government addresses this key concern to some extent
through the subsidized enrolment of indigents in its social health insurance
program.

Education

In past decades the Philippines had enjoyed high adult literacy rates (94%) and
high participation rate in elementary education (97%). However, the gains in the
sector could not be sustained. Falling participation rates, deteriorating quality of
education and students’ failure to reach final grades are some of the current
problems of the Filipino education system which needs to cater to an ever-
increasing number of young people.
Education outcomes in the Philippines are low compared to the rest of East Asia.
Recent international studies ranked the Philippines nearly last in student
performance on science and mathematics tests.

The practice and quality of English has considerably fallen since

its replacement by Filipino as official instruction language. In general, access to
education is not a gender issue in the Philippines, girls even tend to have better
access, lower drop out-rates and better grades. However, there continues to be the
societal bias towards seeing men as the main bread winner. Indigenous groups
and minorities do in principle have access to free education too, but in practice
they sometimes remain outside the system as schools and teachers are often not
available near their areas.
The quality of primary and secondary education has deteriorated particularly in
the public sector. Budget cuts have led to a lack of classrooms and books and
other learning materials. The dearth of competent teachers due to the brain drain
factor has worsened the situation. Urgent action from the government is required
to redress the situation.

Employment and decent work

The employment situation in the Philippines remains characterized by insufficient

capacity to absorb neither the increasing number of unemployed and under-
employed nor the additional labor supply due to strong population growth.
Women tend to face higher unemployment than men and remain more vulnerable
to seasonal fluctuations in employment. Youth unemployment is mitigated to
some extent by increasing outward migration. Furthermore, less than a third of
workers are covered by the national social security system. There are also
concerns regarding the effective compliance with labor law and the limited
enforcement of labor standards. The Philippines have not ratified
the so-called Forced Labor Convention.

54
 Access to social services

Access by the poor to basic services such as housing, safe water, sanitation toilets
and electricity remains a major problem although the situation has improved
somewhat since 1998. However, progress has not been sustained for all basic
infrastructures. The results of the 2002 Annual Poverty Indicators Survey showed
there were fewer families in the lower income brackets that were able to access
safe drinking water (80%), and had their own houses and lots (66.5%), although
there were increases in the provision of sanitary toilets (86.1%) and electricity
(79%). According to government’s monitoring, there is a high probability of
meeting 9 out of 15 indicators covering 8 MDG targets. Five indicators have a
medium probability (all in the areas of health and education) and one indicator
has a low probability (contraceptive prevalence).

Analysis of the environmental situation

The Philippines has rich and diverse natural resources and is one of the five only
biodiversity hotspots. However, overall, the environmental outlook is bleak. Only
8% of the original primary forest remains and many species are under threat; 40%
of the country’s solid waste remains uncollected; just over 36% of river systems
are classified as possible sources of public water supply; over-fishing and
destructive fishing practices are among the main threats to the marine
environment; and 70% of the coral reefs are in bad condition.

The depletion of natural resources is caused by a variety of mutually reinforcing

negative factors: high population pressure with the majority of the poor deriving
their income from natural ecosystems; rapid and uncontrolled urbanization.
Source: The EC-Philippines Strategy Paper, 2007-2013

2.Cavite Province Profile, 2007

AS OF 31 DECEMBER 2007

REFERENCE
INDICATORS CALABARZON
PERIOD CAVITE

GEOGRAPHY
(Source:TWG-PGC, NSCB)
Land Area (in hectares) 2005 1,622,861 128,755
Percentage to the Region's Land Area 2005 7.9%

55
No. of Cities Dec 2007 12 3
No. of Municipalities Dec 2007 130 20
No. of Barangays Dec 2007 4,011 829
No. of Districts Dec 2007 17 3

DEMOGRAPHY
(Sources: NSO & NSCB)
Total Population May 1, 2000 9,320,629 2,063,161
Percentage to the Region's Population May 1, 2000 17.49%
Population Density (persons/sq. km.) May 1, 2000 1,602.3
Population Projection a/
Female 2010 5,983,200 1,494,300
Male 2010 5,920,900 1,419,200
Average Annual Population Growth Rate 1995-2000 5.45%
Human Development Index 2000 0.735

AGRICULTURE
(Source: BAS)
Palay Production (in metric tons) 2007 391,418 38,685
Corn Production (in metric tons) 2007 66,249 2,729
Total Fish Production (in metric tons) p/ 4th Qtr 2007 103,451 2,043
Commercial Fish Production (in metric tons) p/ 4th Qtr 2007 14,423 871
Municipal Fish Production (in metric tons) p/ 4th Qtr 2007 29,804 656
Aquaculture Fish Production (in metric tons) p/ 4th Qtr 2007 59,225 516
Inventory of Carabao (in metric tons) p/ Jan 2008 167,423 4,500
Inventory of Cattle (in metric tons) p/ Jan 2008 250,500 31,009
Inventory of Goat (in metric tons) p/ Jan 2008 214,211 15,968
Inventory of Hog (in metric tons) p/ Jan 2008 1,794,480 161,386
Inventory of Duck (in metric tons) p/ Jan 2008 902,766 25,943
Inventory of Chicken (in metric tons) p/ Jan 2008 22,313,817 3,153,127

INCOME and PRICES

(Sources: NSO & DTI)
Average Income Per Capita (in pesos) 2000 39,989
Average Annual Family Income 2000 127,699
(at 1994 prices)
Average Annual Family Expenditures 2000 104,248
(at 1994 prices)
Consumer Price Index (2000=100) Nov 2007 143.0 132.8
Inflation Rate (2000=100) Nov 2007 2.6 2.4
Purchasing Power of the Peso Nov 2007 0.70 0.75
Prices of Cement (in pesos)
Portland Sep 2007 175.00
Pozzolan Sep 2007 …
Price of G.I. Sheet
(Corrugated, gauge 26) Sep 2007 29.00
(Corrugated gauge 31) Sep 2007 30.00

INVESTMENTS and EXPORTS

(Source: DTI)
Investments Generated (in million pesos) 2nd Qtr 2001 12,068.851 3,701.278
Exports (in million US dollars) 2nd Qtr 2001 1,620.450 588.800

POVERTY STATISTICS r/
(Source: NSCB)

56
Annual Per Capita Poverty Threshold
(in pesos) 2007 16,866 18,019
Poverty Incidence of Poor Families
(in percent) 2003 14.5 8.6
Poverty Incidence of Poor Population
(in percent) 2003 18.4 12.5
Annual Per Capita Food Threshold
(in pesos) 2007 10,595 11,467
Subsistence Incidence of Poor Families
(in percent) 2003 3.5 1.0 b/
Subsistence Incidence of Poor Population
(in percent) 2003 4.7 1.3 b/

TRANSPORTATION
(Sources: LTO & DPWH)
Motor Vehicles Registered 4th Qtr 2007 105,378 27,728
National Road Length (in kilometers) 2003 2,689.096 372.930
National Bridge Length (in kilometers) 2003 14.981 2.267

COMMUNICATION
(Source: NTC)
No. of Telephone Lines Installed 2006 1,050,054 317,973
No. of Telephone Lines Subscribed 2006 566,801 154,765

TOURISM
(Source: DOT)
Visitor Arrivals p/ 2006 2,404,967 57,526

HEALTH
(Source: DOH)
Livebirths c/ 2006 19.72 20.30
(per 1,000 population)
Death Rate c/ 2006 3.48 3.44
(per 1,000 population) 6.40
Infant Mortality Rate c/ 2006 7.50 44.73
(per 1,000 livebirths)
Maternal Mortality Rate c/ 2006 0.32 0.23
(per 100,000 livebirths)

LITERACY
(Sources: FLEMMS, NSO-DECS)
Simple Literacy Rate Household
Population 10 Years Old & Over
Male Nov 1994 93.95 b/ 96.8
Female Nov 1994 94.07 b/ 95.1
Functional Literacy Rate Household
Population 10 to 64 years old
Male Nov 1994 92.4
Female Nov 1994 93.2

EDUCATION
(Source: DepEd)
No. of Enrollees
Public Elementary SY 2006-2007 1,400,860 300,325
Private Elementary SY 2006-2007 211,489 63,661
No. of Enrollees
Public Elementary SY 2006-2007 611,959 142,059

57
 Private Elementary SY 2006-2007 214,795 51,246
No. of Public Elementary Schools e/ SY 2006-2007 2,643 362
No. of Public Secondary Schools e/ SY 2006-2007 474 61
Teacher-Pupil Ratio (Public Elementary) c/ SY 2005-2006 1:47
Teacher-Student Ratio (Public Secondary) c/ SY 2005-2006 1:47

PUBLIC ORDER and SAFETY

(Sources: PNP & BFP)
Total Crime Volume 4th Qtr 2007 1,392 402
Crime Solution Efficiency Rate 4th Qtr 2007 90.01% 83.33%
Fire Incidence (in no. of fires) p/ 4th Qtr 2007 136 59
Fire Damages to Property 4th Qtr 2007 56,050.04 16,882.04
(in thousand pesos) p/

Notes:
Provincial figures include cities unless otherwise noted
- nil or zero
... no data available
a/ - Based on the 2000 Census-Based National, Regional and PROVINCIAL Population Projections
b/ - coefficient of variation greater than 20%
c/ - provincial data excludes cities
d/ - Reference period: Year 2000
e/ - includes school annexes
p/ preliminary
r/ revised

Sources of Data:
BAS - Bureau of Agricultural Statistics, Region IV-A
BFP - Bureau of Fire Protection, Region IV-A
DepEd - Department of Education, Region IV-A
DOH - Department of Health, Region IV-A
DOT - Department of Tourism, Region IV
DPWH - Department of Public Works and Highways, Region IV-A
DTI - Department of Trade and Industry, Region IV-A
FLEMMS - Functional Literacy, Education and Mass Media Survey
LTO - Land Transportation Office, Region IV-A
NSCB - National Statistical Coordination Board
NSO - National Statistics Office, Region IV-A
NTC - National Telecommunications Commission, Region IV
PRO - Police Regional Office, Region IV-A
TWG-PGC - Technical Working Group on Philippine Geographic Classification, NSCB

58
3. LIST OF CITIES AND MUNICIPALITIES BY INCOME CLASS,
URBANITY AND DISTRICT
(as of September 2004)

Income b c
Municipality a Rural/Urban District
Class
Alfonso 3rd Class Partially Urban 3rd
Amadeo 4th Class Partially Urban 3rd
Bacoor 1st Class Urban 1st
Carmona 1st Class Urban 2nd
Cavite City 3rd Class Urban 1st
Dasmarinas 1st Class Urban 2nd
Gen. Aguinaldo 5th Class Partially Urban 3rd
Gen. M. Alvarez 2nd Class Urban 2nd
Gen. Trias 1st Class Partially Urban 2nd
Imus 1st Class Partially Urban 2nd
Indang 3rd Class Partially Urban 3rd
Kawit 1st Class Urban 1st
Magallanes 5th Class Partially Urban 3rd
Maragondon 4th Class Partially Urban 3rd
Mendez 4th Class Urban 3rd
Naic 2nd Class Partially Urban 3rd
Noveleta 4th Class Urban 1st
Rosario 1st Class Urban 1st
Silang 1st Class Partially Urban 3rd
Tagaytay City 3rd Class Partially Urban 3rd
Tanza 1st Class Partially Urban 2nd
Ternate 4th Class Partially Urban 3rd
Trece Martires City 4th Class Partially Urban 2nd

Note: Source: a - Bureau of Local Government Finance; b - NSO; and c - COMELEC

59
 4. Cavite Poverty Incidence Map

Note:
Poverty incidence
(PI)
Definition the proportion of families/individuals with per
capita income/expenditure less than the per
capita poverty threshold to the total number of

60
 families/individuals

5. Annual Per Capita Poverty Thresholds for Region IV -A, 2005 - 2006
(Revised estimates as of 21 June 2007)

2005 Poverty Threshold 2006 Poverty Threshold

(in PhP) (in PhP)
Region / Province
All areas Urban Rural All areas Urban Rural

PHILIPPINES 1/ 14,046 16,032 13,296 14,906 17,035 14,123

Region IV-A 16,103 16,849 15,651 17,151 17,779 16,771

Batangas 17,168 17,872 16,867 18,404 18,881 18,201

Cavite 17,155 16,895 17,788 17,876 17,552 18,667

Laguna 15,639 16,149 14,801 16,531 17,069 15,649

Quezon 14,816 16,511 14,562 15,927 18,042 15,610

Rizal 16,114 16,151 15,789 16,971 17,016 16,576

Source :NCSB

Note:

Poverty threshold
(PT)

61
 Definition the minimum income/expenditure required for a
family/individual to meet the basic food and
non-food requirements

Notes:

Basic food requirements are currently based on

100% adequacy for the Recommended Energy and
Nutrient Intake (RENI) for protein and energy
equivalent to an average of 2000 kilocalories per
capita, and 80% adequacy for other nutrients. On
the other hand, basic non-food requirements,
indirectly estimated by obtaining the ratio of food
to total basic expenditures from a reference group
of families, cover expenditure on: 1) clothing and
footwear; 2) housing; 3) fuel, light, water; 4)
maintenance and minor repairs; 5) rental of
occupied dwelling units; 6) medical care; 7)
education; 8) transportation and communication;
9) non-durable furnishings; 10) household
operations; and 11) personal care & effects.

6. Cavite Political Divisions

Pop. density
No. of Population Area
City/Municipality (per
Barangays (2000) (km²)
km²)
Alfonso 32 39,674 72.60 546.47
Amadeo 26 25,737 46.90 548.76
Bacoor 73 305,699 52.40 5,833.95
Carmona 14 47,856 30.90 1,548.74
Cavite City 84 99,367 20.80 4,777.26
Dasmariñas 73 379,520 90.10 4,212.21
Gen. Mariano Alvarez 27 112,446 11.40 9,863.68
Gen. Emilio Aguinaldo 14 14,323 45.10 317.58
Gen. Trias 33 107,691 108.70 990.72

62
 Imus 97 195,482 64.70 3,021.36
Indang 36 51,281 104.90 488.86
Kawit 23 62,751 16.70 3,757.54
Magallanes 16 18,090 77.10 234.63
Maragondon 27 31,227 202.10 154.511
Mendez 25 22,937 20.70 1,108.07
Naic 30 72,683 86.00 845.15
Noveleta 16 31,959 8.60 3,716.16
Rosario 20 73,665 8.20 8,983.54
Silang 64 156,137 209.40 745.64
Tagaytay City 34 45,287 66.10 685.13
Tanza 41 110,517 98.20 1,125.43
Ternate 10 17,179 54.70 314.06
Trece Martires City 13 41,653 49.10 848.33

Source: Wikipedia

7.Millennium Development Goals

In September 2000, member states of the United Nations (UN) gathered at the Millennium
Summit to affirm commitments towards reducing poverty and the worst forms of
human deprivation. The Summit adopted the UN Millennium Declaration which
embodies specific targets and milestones in eliminating extreme poverty worldwide.

To help track progress in the attainment of the 8 goals and 18 targets of the Millennium
Development Goals (MDG) over the period 1990 to 2015, experts from the United
Nations Secretariat and International Monetary Fund (IMF), Organization of
Economic Cooperation and Development (OECD) and the World Bank identified and
selected a set of time-bound and measurable indicators. Data series on the 48 MDG
indicators are compiled to provide the basis for the preparation of progress reports by
member states of the United Nations (UN) on the implementation of the UN
Millennium Declaration.

MDG Indicators
(data updated 26 March 2004)

63
 The United Nations Secretariat, specialized agencies of the UN system, and
representatives of the International Monetary Fund (IMF), the World Bank and
Organization for Economic Co-operation and Development (OECD) as well as
international experts identified and selected the 48 MDG indicators.

The millennium indicators for each goal are as follows:

Goal 1. Eradicate Extreme Poverty and Hunger

• Proportion of population below $1 (PPP) per day

• Poverty gap ratio
• Share of poorest quintile in national consumption
• Prevalence of underweight children under 5 years of age
• Proportion of population below minimum level of dietary energy consumption

Goal 2. Achieve Universal Primary Education

• Net enrolment ratio in primary education

• Proportion of pupils starting grade 1 who reach grade 5
• Literacy rate of 15-24 year-olds

Goal 3. Promote Gender Equality And Empower Women

• Ratios of girls to boys in primary, secondary and tertiary education

• Ratio of literate females to males of 15-24 year-olds
• Share of women in wage employment in the non-agricultural sector
• Proportion of seats held by women in national parliament

Goal 4. Reduce Child Mortality

• Under-five mortality rate

• Infant mortality rate
• Proportion of 1 year-old children immunized against measles

Goal 5. Improve Maternal Health

• Maternal mortality ratio

• Proportion of births attended by skilled health personnel

Goal 6. Combat HIV/Aids, Malaria and Other Diseases

• HIV prevalence among 15-24 year old pregnant women

• Condom use rate of the contraceptive prevalence rate
• Number of children orphaned by HIV/AIDS (to be measured by the ratio or proportion
of orphans to non-orphans aged 10-14 who are attending school)
• Prevalence and death rates associated with malaria
• Proportion of population in malaria risk areas using effective malaria prevention and
treatment measures

64
 • Prevalence and death rates associated with tuberculosis
• Proportion of tuberculosis cases detected and cured under directly observed
treatment short course (DOTS)

Goal 7. Ensure Environmental Sustainability

• Proportion of land area covered by forest

• Ratio of area protected to maintain biological diversity to surface area
• Energy use (kg oil equivalent) per $1 GDP (PPP)
• Carbon dioxide emissions (per capita) and consumption of ozone-depleting CFCs (ODP
tons)
• Proportion of population using solid fuels
• Proportion of population with sustainable access to improved water source, urban and
rural
• Proportion of urban population with access to improved sanitation
• Proportion of households with access to secure tenure (owned or rented)

Goal 8. Develop A Global Partnership For Development

• Proportion of total bilateral, sector-allocable ODA of OECD/DAC donors to basic social

services (basic education, primary health care, nutrition, safe water and sanitation)
• Proportion of bilateral ODA of OECD/DAC donors that is untied
• ODA received in landlocked countries as proportion of their GNIs
• ODA received in small island developing States as proportion of their GNIs
• Market access
• Proportion of total developed country imports (by value and excluding arms) from
developing countries and LDCs, admitted free of duties
• Average tariffs imposed by developed countries on agricultural products and textiles
and clothing from developing countries
• Agricultural support estimate for OECD countries as percentage of their GDP
• Proportion of ODA provided to help build trade capacity (OECD and WTO are
collecting data that will be available from 2001 onwards)
• Debt sustainability
• Total number of countries that have reached their HIPC decision points and number
that have reached their HIPC completion points (cumulative)
• Debt relief committed under HIPC initiative, US$
• Debt service as a percentage of exports of goods and services
• Unemployment rate of 15-24 year olds, each sex and total (an improved measure of
the targets is under development by ILO for future years)
• Proportion of population with access to affordable essential drugs on a sustainable
basis
• Telephone lines and cellular subscribers per 100 population
• Personal computers in use per 100 population and internet users per 100 population

Source: NCSB

MDGWatch
Statistics at a glance of the Philippines' Progress based on the MDG indicators
as of November 2007

65
Goals/Targets/Indicators Baseline Target Latest Probability*

GOAL 1. ERADICATE EXTREME POVERTY AND HUNGER

Halve, between 1990s and 2015, the proportion of people whose income is less
target 1
than one dollar a day

Proportion of population below national 45.3 22.7 30.4

indicator 1a
poverty threshold 1991 2015 2003

13.0 6.5 8.4

indicator 2 Poverty gap ratio
1991 2015 2003

Share of poorest quintile in national 4.7 2.4 4.7

indicator 3
consumption 1991 2015 2003

target 2 Halve, between 1990 and 2015, the proportion of people who suffer from hunger

Prevalence of underweight children under 34.5 17.3 24.6

indicator 4
5 years of age 1990 2015 2006

Percent of household with per capita 69.4 34.7 56.9

indicator 5
energy less than 100% adequacy 1993 2015 2003

GOAL 2. ACHIEVE UNIVERSAL PRIMARY EDUCATION

Ensure that, by 2015, children everywhere, boys and girls alike, will be able to
target 3
complete a full course of primary schooling

99.1 100.0 84.4

indicator 6 Net enrolment ratio in primary education
1990 2015 2005

Proportion of pupils starting grade 1 who 69.7 100.0 70.0

indicator 7a
reach grade 6 1990 2015 2005

63.0 100.0 68.1

indicator 7b Primary completion rate
1993 2015 2005

96.6 100.0 96.6

indicator 8 Literacy rate of 15 to 24 years old
1990 2015 2003

GOAL 3. PROMOTE GENDER EQUALITY AND EMPOWER WOMEN

Eliminate gender disparity in primary and secondary education preferably by 2005
target 4
and to all levels of education no later than 2015

1.0 1.0 0.9

indicator 9a Ratio of girls to boys in primary education
1993 2015 2005

Ratio of girls to boys in secondary 1.1 1.0 1.1

indicator 9b
education 1993 2015 2005

1.3 1.0 1.2

indicator 9c Ratio of girls to boys in tertiary education
1993 2015 2004

Ratio of literate females to males of 15- 1.0 1.0 1.0

indicator 10
24 year-olds 1990 2015 2003

Share of women in wage employment in 40.6 50.0 41.2

indicator 11
the non-agricultural sector 1990 2015 2003

Proportion of seats held by women in 11.3 50.0 17.6

indicator 12
national parliament 1992 2015 2004

GOAL 4. REDUCE CHILD MORTALITY

target 5 Reduce by two-thirds, between 1990 and 2015, the under-five mortality rate

80.0 26.7 32.0

indicator 13 Under-five mortality rate
1990 2015 2006

66
 57.0 19.0 24.0
indicator 14 Infant mortality rate
1990 2015 2006

Proportion of 1 year-old children 77.9 100.0 83.7

indicator 15
immunized against measles 1990 2015 2005

GOAL 5. IMPROVE MATERNAL HEALTH

target 6 Reduce by three-quarters, between 1990 and 2015, the maternal mortality ratio

209.0 52.3 162.0

indicator 16 Maternal mortality
1990 2015 2006

Proportion of births attended by skilled 58.8 100.0 63.7

indicator 17
health personnel 1990 2015 2005

GOAL 6. COMBAT HIV/AIDS, MALARIA AND OTHER DISEASES

target 7 Have halted by 2015 and begun to reverse the spread of HIV/AIDS

Condom use rate of the contraceptive 1.0 increasing 1.6

indicator 19a
prevalence rate 1993 2015 2006

40.0 100.0 50.6

indicator 19c Contraceptive prevalence rate
1993 2015 2006

Have halted by 2015 and begun to reverse the incidence of malaria and other major
target 8
diseases

118.7 0.0 43.3

indicator 21a Prevalence associated with malaria
1990 2015 2005

1.5 0.0 0.8

indicator 21b Death rate associated with malaria
1990 2015 1998

246.0 0.0 157.8

indicator 23a Prevalence associated with tuberculosis
1990 2015 2003

39.1 0.0 37.4

indicator 23b Death rate associated with tuberculosis
1990 2015 1998

Proportion of tuberculosis cases detected

53.0 70.0 63.0
indicator 24a under directly observed treatment short
2001 2015 2006
course (DOTS)
Proportion of tuberculosis cases cured
73.0 85.0 83.0
indicator 24b under directly observed treatment short
2001 2015 2006
course (DOTS)
GOAL 7. ENSURE ENVIRONMENTAL SUSTAINABILITY
Integrate the principles of sustainable development into country policies &
target 9
programmes to reverse the loss of environmental resources

20.5 23.9
indicator 25 Proportion of land area covered by forest increasing
1990 2003

Ratio of area protected to maintain 8.5 12.7

indicator 26 increasing
biological diversity to surface area 1990 2006

Consumption of ozone-depleting CFCs 2981 681

indicator 28 decreasing
(ODP tons) 1990 2006

Proportion of households using solid fuels 66.2 42.1

indicator 29 decreasing
for cooking 1990 2003

Halve, by 2015, the proportion of population without sustainable access to safe

target 10
drinking water and improved sanitation

Proportion of population with sustainable 73.0 86.5 80.2

indicator 30
access to improved water source 1990 2015 2004

67
 Proportion of urban population with 67.6 83.8 86.2
indicator 31
access to improved sanitation 1990 2015 2004

By 2020, have achieved significant improvement in the lives of at least 100 million
target 11
slum dwellers

Proportion of households with access to 91.0 81.2

indicator 32 increasing
secure tenure 1990 2000

GOAL 8. DEVELOP A GLOBAL PARTNERSHIP FOR DEVELOPMENT

Deal comprehensively with the debt problems of developing countries thru national
target 15
& international measures in order to make debt sustainable in the long term

Debt service as a percentage of exports 27.2 12.0

indicator 44 decreasing
of goods and services 1990 2006

In cooperation with developing countries, develop and implement strategies for

target 16
decent and productive work for youth

10.9 16.4
indicator 45 Unemployment rate of 15-24 year olds decreasing
1990 2005

In cooperation with the private sector, make available the benefits of new
target 18
technologies, especially information and communications

Telephone lines subscribers per 100 1.5 8.3

indicator 47a increasing
population 1990 2006

Cellular phone subscribers per 100 0.1 41.3

indicator 47b increasing
population 1991 2005

* based on the comparison of actual (from baseline to latest data)

and required (from baseline to target year) rates of progress

Probability of Achieving the Goal

Low ; Pace of Progress is less than 0.5

Medium ; Pace of Progress between 0.5 and 0.9

High ; Pace of Progress is greater than 0.9

Source: NCSB

8. E-Procurement System

E-Procurement is more than just a system for making purchases online. A properly
implemented system can connect companies and their business processes directly with
suppliers while managing all interactions between them. This includes management of
correspondence, bids, questions and answers, previous pricing, and multiple emails sent
to multiple participants.

68
crucial suppliers. It provides those who use it with a set of built-in monitoring tools to
help control costs and assure maximum supplier performance. It provides an organized
way to keep an open line of communication with potential suppliers during a business
process. The system allows managers to confirm pricing, and leverage previous
agreements to assure each new price quote is more competitive than the last.

Benefits of Adopting an E-Procurement System

E-Procurement helps with the decision-making process by keeping relevant information

neatly organized and time-stamped. Most are template-driven which makes all
transactions standardized and trackable. Keeping track of all bids means leveraging
your knowledge to obtain better pricing. Companies can focus on their most lucrative
trading partners and contracts.

Well-managed e-procurement helps reduce inventory levels. Knowing product

numbers, bid prices and contact points can help businesses close a deal while other
suppliers are struggling to gather their relevant data.

E-Procurement systems that allow multiple access levels and permissions help
managers organize administrative users by roles, groups, or tasks. Procurement
managers do not need to be as highly trained or paid because such systems are
standardized and easy to learn.

Typical Adoption Strategies

Some firms have discovered that many of their transactions still take place on paper,
and they have run into problems ranging from content management to supplier
participation in their systems. Most companies who desire to make the switch fall into
two camps. The first are the slow step-by-step adopters. They implement one piece of
their system at a time and slowly bring trading partners on board. The others follow the
total replacement model. They build a totally parallel system, test it, then switch over to
it when it works. There is usually some pain involved and some mistakes are
discovered, but by and large these are absorbed and the business continues.

Pitfalls to Avoid

Don»t bite off more than you can chew. The parallel system approach should only be
used if you have the time and resources to do this. If not, stick to the incremental
approach.

Don»t expects an immediate return on investment. A short-tem gain may be noticeable,

but it may be eaten up by the cost of staff training and equipment purchases. A year or
two down the road, a larger ROI should be evident

Source: Wikipedia

69
9. Enterprise Resource Planning

From Wikipedia, the free encyclopedia

Enterprise Resource Planning systems (ERPs) integrate (or attempt to integrate) all
data and processes of an organization into a unified system. A typical ERP system
will use multiple components of computer software and hardware to achieve the
integration. A key ingredient of most ERP systems is the use of a unified database to
store data for the various system modules.

The term ERP originally implied systems designed to plan the utilization of
enterprise-wide resources. Although the acronym ERP originated in the
manufacturing environment, today's use of the term ERP systems has much broader
scope. ERP systems typically attempt to cover all basic functions of an organization,
regardless of the organization's business or charter. Business, non-profit
organizations, non governmental organizations, governments, and other large entities
utilize ERP systems.

Additionally, it may be noted that to be considered an ERP system, a software

package generally would only need to provide functionality in a single package that
would normally be covered by two or more systems. Technically, a software package
that provides both payroll and accounting functions (such as QuickBooks) would be
considered an ERP software package.

However, the term is typically reserved for larger, more broadly based applications.
The introduction of an ERP system to replace two or more independent applications
eliminates the need for external interfaces previously required between systems, and
provides additional benefits that range from standardization and lower maintenance
(one system instead of two or more) to easier and/or greater reporting capabilities (as
all data is typically kept in one database).

Examples of modules in an ERP which formerly would have been stand-alone

applications include: Manufacturing, Supply Chain, Financials, CRM, Human
Resources, and Warehouse Management.

Overview

Looking more closely at ERP systems, a key factor is the integration of data
from all aspects of an organization. To accomplish this, an ERP system typically runs
on a single database instance with multiple software modules providing the various
business functions of an organization.

Some organizations - typically those with sufficient in-house IT skills to

70
integrate multiple software products - choose to only implement portions of an ERP
system and develop an external interface to other ERP or stand-alone systems for
their other application needs. For instance, the PeopleSoft HRMS and Financials
systems may be perceived to be better than SAP's HRMS solution. And likewise,
some may perceive SAP's manufacturing and CRM systems as better than
PeopleSoft's equivalents. In this case these organizations may justify the purchase of
an ERP system, but choose to purchase the PeopleSoft HRMS and Financials
modules from Oracle, and their remaining applications from SAP.

This is very common in the retail sector, where even a mid-sized retailer will have a
discrete Point-of-Sale (POS) product and financials application, then a series of
specialized applications to handle business requirements such as warehouse
management, staff rostering, merchandising and logistics.

Ideally, ERP delivers a single database that contains all data for the software
modules, which would include:

Manufacturing
Engineering, Bills of Material, Scheduling, Capacity, Workflow Management,
Quality Control, Cost Management, Manufacturing Process, Manufacturing Projects,
Manufacturing Flow
Supply Chain Management
Inventory, Order Entry, Purchasing, Product Configurator, Supply Chain Planning,
Supplier Scheduling, Inspection of goods, Claim Processing, Commission Calculation
Financials
General Ledger, Cash Management, Accounts Payable, Accounts Receivable, Fixed
Assets
Projects
Costing, Billing, Time and Expense, Activity Management
Human Resources
Human Resources, Payroll, Training, Time & Attendance, Benefits
Customer Relationship Management
Sales and Marketing, Commissions, Service, Customer Contact and Call
Center support
Data Warehouse
and various Self-Service interfaces for Customers, Suppliers, and Employees

Enterprise Resource Planning is a term originally derived from manufacturing

resource planning (MRP II) that followed material requirements planning (MRP).
MRP evolved into ERP when "routings" became major part of the software
architecture and a company's capacity planning activity also became a part of the
standard software activity. ERP systems typically handle the manufacturing, logistics,
distribution, inventory, shipping, invoicing, and accounting for a company. Enterprise
Resource Planning or ERP software can aid in the control of many business activities,
like sales, marketing, delivery, billing, production, inventory management, quality
management, and human resources management.

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 ERPs are often incorrectly called back office systems indicating that customers
and the general public are not directly involved. This is contrasted with front office
systems like customer relationship management (CRM) systems that deal directly
with the customers, or the eBusiness systems such as eCommerce, eGovernment,
eTelecom, and eFinance, or supplier relationship management (SRM) systems.

ERPs are cross-functional and enterprise wide. All functional departments that are
involved in operations or production are integrated in one system. In addition to
manufacturing, warehousing, logistics, and Information Technology, this would
include accounting, human resources, marketing, and strategic management.

ERP II means open ERP architecture of components. The older, monolithic ERP
systems became component oriented.

EAS - Enterprise Application Suite is a new name for formerly developed ERP
systems which include (almost) all segments of business, using ordinary Internet
browsers as thin clients.

Before

Prior to the concept of ERP systems, departments within an organization would have
their own computer systems. For example, the Human Resources (HR) department,
the Payroll (PR) department, and the Financials department. The HR computer
system (Often called HRMS or HRIS) would typically contain information on the
department, reporting structure, and personal details of employees. The PR
department would typically calculate and store paycheck information. The Financials
department would typically store financial transactions for the organization. Each
system would have to rely on a set of common data to communicate with each other.
For the HRIS to send salary information to the PR system, an employee number
would need to be assigned and remain static between the two systems to accurately
identify an employee. The Financials system was not interested in the employee level
data, but only the payouts made by the PR systems, such as the Tax payments to
various authorities, payments for employee benefits to providers, and so on. This
provided complications. For instance, a person could not be paid in the Payroll
system without an employee number.

After

ERP software, among other things, combined the data of formerly disparate
applications. This made the worry of keeping employee numbers in synchronization
across multiple systems disappear. It standardized and reduced the number of
software specialties required within larger organizations.

Best Practices

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Best Practices were also a benefit of implementing an ERP system. When
implementing an ERP system, organizations essentially had to choose between
customizing the software or modifying their business processes to the "Best Practice"
functionality delivered in the vanilla version of the software.

Typically, the delivery of best practice applies more usefully to large organizations
and especially where there is a compliance requirement such as IFRS, Sarbanes-
Oxley or Basel II, or where the process is a commodity such as electronic funds
transfer. This is because the procedure of capturing and reporting legislative or
commodity content can be readily codified within the ERP software, and then
replicated with confidence across multiple businesses who have the same business
requirement.

Where such a compliance or commodity requirement does not underpin the business
process, it can be argued that determining and applying a best practice actually erodes
competitive advantage by homogenizing the business compared to everyone else in
their industry sector.

Evidence for this can be seen within EDI, where the concept of best practice, even
with decades of effort remains elusive. A large retailer, for example, wants EDI plus
some minor tweak that they perceive puts them ahead of their competition. Mid-
market companies adopting ERP often take the vanilla version and spend half as
much as the license cost doing customizations that deliver their competitive edge. In
this way they actively work against best practice because they perceive that the way
they operate is best practice, irrespective of what anyone else is doing.

Implementation

Because of their wide scope of application within a business, ERP software systems
are typically complex and usually impose significant changes on staff work practices
(if they did not, there would be little need to implement them). Implementing ERP
software is typically not an "in-house" skill, so even smaller projects are more cost
effective if specialist ERP implementation consultants are employed. The length of
time to implement an ERP system depends on the size of the business, the scope of
the change and willingness of the customer to take ownership for the project. A small
project (eg, a company of less than 100 staff) may be planned and delivered within 3
months; however, a large, multi-site or multi-country implementation may take years.

The most important aspect of any ERP implementation is that the company who
has purchased the ERP product takes ownership of the project.

To implement ERP systems, companies often seek the help of an ERP vendor or of
third-party consulting companies. These firms typically provide three areas of
professional services: Consulting, Customization and Support.

Consulting Services

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The Consulting team is typically responsible for your initial ERP implementation and
subsequent delivery of work to tailor the system beyond "go live". Typically such
tailoring includes additional product training; creation of process triggers and
workflow; specialist advice to improve how the ERP is used in the business; system
optimization; and assistance writing reports, complex data extracts or implementing
Business Intelligence.

The consulting team are also responsible for planning and jointly testing the
implementation. This is a critical part of the project, and one that is often overlooked.

Consulting for a large ERP project involves three levels: systems architecture,
business process consulting (primarily re-engineering) and technical consulting
(primarily programming and tool configuration activity). A systems architect designs
the overall dataflow for the enterprise including the future dataflow plan. A business
consultant studies an organization's current business processes and matches them to
the corresponding processes in the ERP system, thus 'configuring' the ERP system to
the organization's needs. Technical consulting often involves programming. Most
ERP vendors allow modification of their software to suit the business needs of their
customer.

For most mid-sized companies, the cost of the implementation will range from around
the list price of the ERP user licenses to up to twice this amount (depending on the
level of customization required). Large companies, and especially those with multiple
sites or countries, will often spend considerably more on the implementation than the
cost of the user licenses -- three to five times as more is not uncommon for a multi-
site implementation.

Customization Services

Customization is the process of extending or changing how the system works by

writing new user interfaces and underlying application code. Such customizations
typically reflect local work practices that which are not currently in the core routines
of the ERP system software.

Examples of such code include early adopter features (e.g., mobility interfaces were
uncommon a few years ago and were typically customized) or interfacing to third
party applications (this is 'bread and butter' customization for larger implementations
as there are typically dozens of ancillary systems that the core ERP software has to
interact with). The Professional Services team is also involved during ERP upgrades
to ensure that customizations are compatible with the new release. In some cases the
functionality delivered via previous a customization may have been subsequently
incorporated into the core routines of the ERP software, allowing customers to revert
back to standard product and retire the customization completely.

Customizing an ERP package can be very expensive and complicated, because many
ERP packages are not designed to support customization, so most businesses

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 implement the best practices embedded in the acquired ERP system. Some ERP
packages are very generic in their reports and inquiries, such that customization is
expected in every implementation. It is important to recognize that for these packages
it often makes sense to buy third party plug-ins that interface well with your ERP
software rather than reinventing the wheel.

Customization work is usually undertaken as bespoke software development on a

time and materials basis. Because of the specialist nature of the customization and the
'one off' aspect of the work, it is common to pay in the order of $200 per hour for this
work. Also, in many cases the work delivered as customization is not covered by the
ERP vendors Maintenance Agreement, so while there is typically a 90-day warranty
against software faults in the custom code, there is no obligation on the ERP vendor
to warrant that the code works with the next upgrade or point release of the core
product.

One often neglected aspect of customization is the associated documentation. While it

can seem like a considerable -- and expensive -- overhead to the customization
project, it is critical that someone is responsible for the creation and user testing of the
documentation. Without the description on how to use the customization, the effort is
largely wasted as it becomes difficult to train new staff in the work practice that the
customization delivers.

Maintenance and Support Services

Once your system has been implemented, the consulting company will typically enter
into a Support Agreement to assist your staff keeps the ERP software running in an
optimal way. A Maintenance Agreement typically provides you rights to all current
version patches, and both minor and major releases, and will most likely allow your
staff to raise support calls. While there is no standard cost for this type of agreement,
they are typically between 15% and 20% of the list price of the ERP user licenses.

Advantages

In the absence of an ERP system, a large manufacturer may find itself with many
software applications that do not talk to each other and do not effectively interface.
Tasks that need to interface with one another may involve:

• design engineering (how best to make the product)

• order tracking from acceptance through fulfillment
• the revenue cycle from invoice through cash receipt
• managing interdependencies of complex Bill of Materials
• tracking the 3-way match between Purchase orders (what was ordered), Inventory
receipts (what arrived), and Costing (what the vendor invoiced)
• the Accounting for all of these tasks, tracking the Revenue, Cost and Profit on a
granular level.

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Change how a product is made, in the engineering details, and that is how it will now
be made. Effective dates can be used to control when the switch over will occur from
an old version to the next one, both the date that some ingredients go into effect, and
date that some are discontinued. Part of the change can include labeling to identify
version numbers.

Computer security is included within an ERP to protect against both outsider crime,
such as industrial espionage, and insider crime, such as embezzlement. A data
tampering scenario might involve a terrorist altering a Bill of Materials so as to put
poison in food products, or other sabotage. ERP security helps to prevent abuse as
well.

Disadvantages

Many problems organizations have with ERP systems are due to inadequate
investment in ongoing training for involved personnel, including those implementing
and testing changes, as well as a lack of corporate policy protecting the integrity of
the data in the ERP systems and how it is used.

Limitations of ERP include:

• Success depends on the skill and experience of the workforce, including

training about how to make the system work correctly. Many companies cut
costs by cutting training budgets. Privately owned small enterprises are often
undercapitalized, meaning their ERP system is often operated by personnel
with inadequate education in ERP in general, such as APICS foundations, and
in the particular ERP vendor package being used.
• Personnel turnover; companies can employ new managers lacking education
in the company's ERP system, proposing changes in business practices that
are out of synchronization with the best utilization of the company's selected
ERP.
• Customization of the ERP software is limited. Some customization may
involve changing of the ERP software structure which is usually not allowed.
• Re-engineering of business processes to fit the "industry standard" prescribed
by the ERP system may lead to a loss of competitive advantage.
• ERP systems can be very expensive to install.
• ERP vendors can charge sums of money for annual license renewal that is
unrelated to the size of the company using the ERP or its profitability.
• Technical support personnel often give replies to callers that are inappropriate
for the caller's corporate structure. Computer security concerns arise, for
example when telling a non-programmer how to change a database on the fly,
at a company that requires an audit trail of changes so as to meet some
regulatory standards.
• ERPs are often seen as too rigid and too difficult to adapt to the specific
workflow and business process of some companies—this is cited as one of the

76
 main causes of their failure.
• Systems can be difficult to use.
• The system can suffer from the "weakest link" problem—an inefficiency in
one department or at one of the partners may affect other participants.
• Many of the integrated links need high accuracy in other applications to work
effectively. A company can achieve minimum standards, then over time "dirty
data" will reduce the reliability of some applications.
• Once a system is established, switching costs are very high for any one of the
partners (reducing flexibility and strategic control at the corporate level).
• The blurring of company boundaries can cause problems in accountability,
lines of responsibility, and employee morale.
• Resistance in sharing sensitive internal information between departments can
reduce the effectiveness of the software.
• There are frequent compatibility problems with the various legacy systems of
the partners.
• The system may be over-engineered relative to the actual needs of the
customer.

10. JIT and Purchasing

Partnerships

In the past companies were capable of remaining independent and competitive when
they had the capability and resources necessary to produce a product. This is no
longer possible. As technology increases in complexity, companies overcome capital
limitations or labor intensive requirements by becoming dependent on suppliers to
provide services. Many services and Original Equipment Manufacturing (OEM)
suppliers have evolved as the result. Companies now appreciate that long-term
success relies on the quality of the customer-supplier relationship established so that
they will develop successful partnerships. Hence, successful partnerships require the
development of mutually beneficial programs.

Commitments

To enable suppliers to deal with customers in a confident manner, they must be

backed by the level of commitment given by manufacturers. Without a partnership
between the customer and supplier, there will always be hesitation instead of trust.
The concept of trust and commitment in JIT is used to build partnerships and to
reduce the needs for materials-production control, receiving inspection or inventory
buffers that many companies have constructed. Contracts used by JIT manufacturing
company to record the details of an agreement usually stress the level of
commitments.

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Contracts Supporting Partnerships

By ensuring fair and equitable contracts, many of the problems in developing

customer-supplier relationships are overcome by JIT manufacturers. The goal of
JIT is to make long-term contracts with suppliers. A long-term contract gives the
supplier a job security for as long as the supplier remains competitive and
committed. Long-term contracts usually extend for one or more years and can
consist of one or more part requirements.

Quality for JIT

Quality is an integral part of a JIT program. Quality control concentrates on quality

at every stage of manufacture including the purchase of raw material. To increase the
supplier quality two methods are used in a JIT system; supplier quality engineering
(SQE) and receiving inspection (RI).
Supplier quality engineering is used to evaluate supplier capability, help suppliers
develop process control, resolve quality issues with suppliers, and certify that
suppliers qualify for JIT production. Receiving inspection provides an inspection
service for purchasing.

Delivery of Purchased Material

On time delivery, frequency of delivery, and receiving and stocking the material are
three major aspects that are important in purchasing.

On-time material delivery means that the work stations receive the material just
before it is required. A suppliers ability to deliver on time is a combination of factors
; transportation, raw material availability, price, holidays, etc. If a factor arises that
could affect the delivery schedule, the company should be able to increase production
schedules and establish enough inventory to see them past the expected disruption.

Frequent delivery is required if dependency on inventory is to be minimized. The

suppliers' ability to make frequent deliveries depends on the suppliers ability to
produce product at the rate the customer requires delivery. Local suppliers usually
have an advantage in being able to deliver daily. Frequent delivery means that a loss
of one small shipment will have less significance than the loss of a large shipment in
on time delivery.

Material shipping and handling requirements: Costs associated with material

shipping includes packaging and handling costs. Packaging costs mainly include
material handling, shipping damage, and the cost of packaging materials. Handling
costs include receiving, unpacking, counting, repacking, stocking, kitting and moving

78
the material to the production area. Reusable packaging material, packing containers
that can be used on the production line, and standardized containers that eliminate
counting are ways to reduce costs and damage in transporting. These cost reducing
methods are then reviewed with the supplier to determine how the supplier can best
meet these needs.

Scheduling: A major concern of purchasing managers is the process of coordinating

the manufacturing need for materials. The process is complicated by periodic changes
in product mix and volume requirement and the continual introduction of new
products. Companies solve the problem of how much material to order and when to
order by placing contracts based on order requirements supplied by material control.
Material control makes its decisions based on the master schedule less current
inventory. In a JIT system the supplier picks up the information on the next
production requirements every time a delivery is made.

Reasonable Cost Price of purchased material is an important issue. Material that

cause or require additional production costs reduce company profits. Every extra
inspection or test step, rework requirement or item scrapped represents a reduction in
company profit. These additional costs are remedied by purchasing products that meet
both specification and production needs.

The most challenging area for most manufacturers in achieving JIT is the purchasing
of raw materials and parts. This is important because an internal JIT system can only
be operated successfully when the material being fed into it are of sufficient quality
and delivered on time. Therefore, unless the quality and delivery of purchased
material are not production issues, the purchasing function should begin to establish a
JIT supplier base. In JIT purchasing several tactics are being used to achieve certain
goals and objectives.

Goals

Secure a steady flow of quality parts.

Reduce the lead time required for ordering product.
Reduce the amount of inventory in the supply and production pipe lines.
Reduce the cost of purchased material.

Objectives

Improve purchasing efficiency.

Improve quality and delivery performance of suppliers.
Isolate factors that influence the cost of material.
Remove unnecessary cost factors in the materials supply system.

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Tactics

Regard suppliers as an extension of the internal manufacturing process and

cultivate them as long term business partners.
Establish long term purchasing and supply commitments.
Improve communication with suppliers.
Involve suppliers in early stages of new product planning.
Use supplier expertise to improve design manufacturability and reduce product
cost.

Purchasing Requirements

Material purchased in a JIT system should meet three requirements:

An acceptable level of quality,
On time delivery schedule, and
A reasonable cost.

Developing JIT Suppliers

It is important to develop a link between the companies so to ensure a long-term

business relationship. This will provide both companies with the stability required to
optimize the profit potential. There are four needs that affect the supplier's ability to
perform: trust, communications, linearity of production, and time and visibility to
make changes.

Trust
The most basic need of suppliers is to be able to trust that the customer will provide
stability if the supplier meets requirements. This will allow the two organizations to
work much more closely than they would based just on a contract.

Communications
To successfully manage the communication link between customers and suppliers can
be done in two ways:

Supplier contacts: To overcome the complexity of the communication problem, some

companies assign a buyer-quality engineer team to be the contact for each supplier.
The advantage of this solution is that it provides a formal communication channel for
the supplier and reduces the potential for miscommunications.

Supplier programs: Supplier programs keep the supplier informed on topics of

mutual interest and ensure the supplier access to information that will have an effect
on the supplier's production. These programs strengthen supplier relationships by
opening communications and providing an understanding of one another needs.

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Linear Production Schedules
Linear production schedules contribute to improving the performance of
manufacturing. In a JIT system, the need for the supplier to track the customers needs
closely is important. For this to occur, the supplier must reduce lead time to the
minimum. This consists of isolating the bottlenecks in the operation, balancing the
production system, and reducing setup-time.

Time and visibility to make changes

Most suppliers can respond to changes in customer demand, but they must have
enough time to make the changes. The types of changes suppliers must make are
purchasing materials, adding equipment, establishing work shifts, and hiring and
training labor. With better schedule visibility, suppliers could react more quickly to
changes in production requirements.

Partnerships - A Mutually Beneficial System

A mutually beneficial system requires that the supplier and customer work in
cooperation to achieve a greater benefit than they would have individually. Three
mutually beneficial systems are :
Early supplier involvement
Just-in-Time materials shipment
Invoicing systems

Early supplier involvement

Involving the supplier early in the design phase of a new product can obtain the best
performance from a supplier. Suppliers will often make suggestions that can improve
the design of the product. Supplier feedback provides avenues for improvement in
cost, quality, and scheduling.

Just-in-Time materials shipments

Deliveries can cause traffic problems. In addition, there are the problems of unloading
material, unpacking it, and moving it to the production-line. Several systems have
been developed to improve the efficiency of deliveries to customer. An example is the
"Bus Route" system installed by Xerox Corporation. The bus routes system improves
material flow, communications, and the interaction of companies.

Invoicing systems
JIT requires frequent deliveries. There are solutions to handling increased invoice
load. Electronic invoicing will work where compatible equipment transmits
customers accounts directly. Another solution is to pay suppliers based on purchasing
records that have completed the assembly process. A third possibility is to batch

81
 invoices and submit them on a bimonthly or monthly schedule. A company can also
invoice the monthly deliveries on one invoice, hence decreasing the amount of
paperwork.

Customer-Supplier Proximity

Customer-supplier partnerships can be formed irrespective of the physical distance

between two companies. Close proximity, however, offers three advantages : early
supplier involvement, line problems are easier to resolve, and communications are
easier. The criteria for determining supplier selection are based on suppliers ability,
location and price.

Source :Wikipedia

11. Minimum Wage Calabarzon

DAILY MINIMUM WAGE RATES

REGION IV-A, CALABARZON a/
Wage Order No. IVA-12 b/
Effective 05 October 2007

Agriculture Retail & Service

Establishment
Non- Cottage employing not more
Plantation Non-
AREAS Agriculture than 10 workers
Plantation

GROWTH CORRIDOR AREA

EMA/1
CAVITE - Bacoor, Imus RIZAL - Cainta, Taytay LAGUNA - Biñan, San Pedro

P 300.00 P 275.00 P 255.00 P P 195.00

263.00

CAVITE - Carmona, Cavite City, Dasmariñas, Gen. Trias, Rosario

LAGUNA - Cabuyao, Calamba City, Los Baños,San Pablo City, Sta. Cruz, Sta. Rosa.
RIZAL - Antipolo City

282.00 257.00 237.00 245.00 177.00

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CAVITE - Kawit, Silang, Tagaytay City, Tanza, Trece Martirez
BATANGAS - Batangas City, Bauan, Lipa City, San Pascual, Sto. Tomas, Tanauan City
QUEZON - Lucena City

277.00 252.00 232.00 240.00 174.00

EGA/2
CAVITE - Gen.Mariano Alvarez RIZAL - Rodriguez, Tanay

277.00 252.00 232.00 240.00 172.00

EMERGING GROWTH AREA

RIZAL - Angono, Binangonan, San Mateo
BATANGAS - Balayan, Calaca, Calatagan, Lemery, Mabini, Nasugbu, Rosario, San Jose
QUEZON - Candelaria, Sariaya

260.00 235.00 215.00 223.00 159.00

CAVITE - Indang, Naic, Noveleta, Ternate LAGUNA - Paete, Pakil BATANGAS - San
Juan
RIZAL - Pililia QUEZON - Tiaong

249.00 224.00 204.00 212.00 146.00

RBA/3
BATANGAS - Taysan RIZAL - Teresa

244.00 219.00 199.00 207.00 145.00

RESOURCE BASED AREA

CAVITE - Alfonso, Amadeo, Gen. Aguinaldo, Magallanes, Maragondon, Mendez-Nunez
LAGUNA - Alaminos, Bay, Calauan, Cavinti, Famy, Kalayaan, Liliw, Luisiana, Lumban,
Mabitac, Magdalena, Majayjay, Nagcarlan, Pagsanjan, Pangil, Pila, Rizal, Sta Maria,
Siniloan, Victoria
BATANGAS - Agoncillo, Alitagtag, Balete, Cuenca, Ibaan, Laurel, Lian, Lobo, Malvar,
Mataas na Kahoy, Padre Garcia, San Luis, San Nicolas, Sta. Teresita, Taal, Talisay,
Tingloy, Tuy
RIZAL - Baras, Cardona, Jala-Jala, Morong

242.00 217.00 197.00 205.00 143.00

QUEZON
Agdangan, Alabat, Atimonan, Buenavista, Burdeos, Calauag, Catanauan, Dolores, Gen.
Luna,

83
Gen. Nakar, Guinayangan, Gumaca, Infanta, Jomalig, Lopez, Lucban, Macalelon,
Mauban, Mulanay, Padre Burgos, Pagbilao, Panulukan, Patnanungan, Perez, Pitogo,
Plaridel, Polilio, Quezon, Real, Sampaloc, San Andres, San Antonio, San Francisco, San
Narciso, Tagkawayan, Tayabas, Unisan

224.00 204.00 184.00 192.00 136.00

a/ Covers the Cities of Cavite , Tagaytay, Trece Martirez, Calamba, San Pablo, Sta.

Rosa, Batangas, Lipa, Tanaun, Antipolo and Lucena and the Provinces of Cavite,
Laguna, Batangas, Rizal and Quezon.
b/ Grants a P6.00 - P13.00 per day wage increase to all minimum wage workers

and employees in the private sector in the region depending on the area
classification

Issued 22 August 2007, published on 20 September 2007 in the Phil. Daily

Inquirer

12. Nominal and Real Wage

CURRENT NOMINAL AND REAL WAGE*, By Region

Non-Agriculture
December 2007
(2000 = 100)

REGION NOMINAL WAGE a/ REAL WAGE b/

NCR 362.00 235.42
CAR 235.00 160.96
I 230.00 157.21
II 223.00 159.63
III 287.00 202.83
IV-A 300.00 208.33
IV-B 237.00 167.37
V 226.00 156.73
VI 235.00 166.43

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 VII 250.00 168.46
VIII 228.00 161.59
IX 215.00 149.72
X 244.00 164.31
XI 250.00 168.92
XII 229.50 163.00
XIII 220.00 152.35
ARMM 200.00 128.45

* Includes COLAs
a/ Highest nominal wage, November 2007
b/ Based on November 2007.CPI.

Source: National Wages and Productivity Commission

Department of Labor and Employment

13. Maps of Cavite

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