A Business Model of DENR's Titling Services

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In an earlier post I suggested that Development Entrepreneurs looking for ways to strengthen or reform an institution can start by describing  its Business Model. A Business Model of any enterprise, organization or agency describes how its Customers, Value Proposition, Relationships between the organization and its customers, a Delivery Mechanism, Key Partners, Key Resources and Key Activities fit with each other. In  addition a Business Model describes the enterprise's Income Streams and Cost Structure.

As an illustration, here is my perception of the Business Model of the Department of the Environment and Natural Resources as a title-issuing agency. This model applies to DENR before Department Administrative Order 2011-06 was passed (and the supporting DILG Memorandum Circular 117-2011 was also issued).

Up to 2010 DENR’s Customers for its titling services were mostly farmers. While DENR issued several forms of titles for public lands its most-issued instrument was the Agricultural Free Patent. In 2010 RA 10023 was passed authorizing DENR to also issue Residential Free Patents. Thus “Residents” (occupants of public lands zoned for residential use) became another set of customers for DENR. Farmers and residents may be considered to comprise a Diversified Market – each group is distinct from the other.

DENR’s Value Proposition is that it is the sole authority to issue these titles for public lands. By necessity it has also built up the expertise to do so (although this expertise can only be found in the Lands units; units within DENR that are working on Forestry, Mineral Resources and Protected Areas don’t have extensive knowledge or experience with titling of public lands.).  To the applicant for a free patent, DENR’s Deputized Public Land Inspectors (DPLIs) offer convenience and peace of mind as they can assuredly get the patents issued.

Thus the Relationship between DENR and its clients took the form of Personal assistance provided by DPLI.  The Delivery Mechanism was the CENRO to which the DPLI is assigned. This is where an application is first processed, before it is favourably endorsed to the PENRO (Provincial office). The PENRO signs the Residential Free Patent. A CENRO covers several LGUs; thus within a Province there can be several CENROs. The CENROs and the PENRO functions as “own outlets” distributed to cover geographical areas (markets), financed and operated by DENR.

LGUs have always been Key Partners of DENR personnel because they are the source of data about claimants (both farmers and residents) and supporting documents for claims and applications (such as Tax Declarations).  RA 10023 required two additional information that DENR can get only from LGUs – 1) whether the land applied for is zoned for residential use; and 2) that there is no intended public use for this land.

Another Key Partner is the private surveying company that is tapped by applicants or by DENR itself.

The Registrar of Deeds must be considered a partner as Free Patents have to be registered.

Their own personnel and staff, funds, survey equipment and Data (including Cadastral Maps, subdivision surveys, Lot Data Computations) comprise DENR’s Key Resources.

The Key Activities undertaken on these resources to provide value to customers belong to a practice called “Sporadic adjudication”. This is dependent on voluntary applications for titles from individuals. When these applicants come in to the CENRO, DPLIs entertain their concerns, assess their claims, identify the necessary supporting documents, ask for surveys when necessary. When all requirements are received the DPLI evaluates them and favourably endorses the application to the PENRO. The PENRO validates the application and its supporting papers and then issues the Free Patent.  The Free Patent is then endorsed to ROD.

(After ROD receives the required payments and additional documents from applicants, it makes sure that there are no overlaps or conflicts with other titles. ROD then registers the title and releases it to the applicant.)

DENR’s Income Stream for this service includes payments for application fees and documentary stamps. There is no processing fee for the Residential Free Patent. Of course each Regional Office receives a budget for operations of its CENROs and PENROs, including an amount intended to enable the Region to achieve its target of Free Patent issuances.

On the other hand, as with all other Government agencies, its Cost Structure is cost-driven (DENR minimizes spending to stay within its budget). Costs include salaries and wages of personnel (PENRO, CENRO, LMOs, DPLIs, survey teams, etc), transportation cost, supplies and overhead.


Once he has Observed the agency’s Business Model, the Development Entrepreneur can proceed to the next step: Orient himself on the opportunities for improvement.  Let’s see how this was done with DENR’s titling services in the next blog.

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