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Improving Service Delivery in Government with Lean Six Sigma ...

  1. 1. PROVIDING CUTTING-EDGE KNOWLEDGE TO GOVERNMENT LEADERS Improving Service Delivery in Government with Lean Six Sigma S t ra t e g y a nd Tra n sfo rmatio n Series John Maleyeff Professor Lally School of Management & Technology Rensselaer Polytechnic Institute Hartford Campus
  2. 2. 2007 S T R AT E G Y A N D T R A N S F O R M AT I O N S E R I E S Improving Service Delivery in Government with Lean Six Sigma John Maleyeff Professor Lally School of Management & Technology Rensselaer Polytechnic Institute Hartford Campus
  3. 3. T A B L E O F C O N T E N T S Foreword..............................................................................................4 Executive Summary..............................................................................6 Understanding Lean Six Sigma.............................................................8 What Is Lean Six Sigma?................................................................8 Relationship to Performance Measurement..................................10 Lean Six Sigma in the Public Sector...................................................12 Success Factors and Examples .....................................................12 Using Lean Six Sigma for Improvements......................................15 Unique Organizational Characteristics ........................................16 Unique Characteristics of Government Processes ........................17 Starting a Lean Six Sigma Program ....................................................18 Infrastructure Considerations .......................................................18 Implementation Considerations ...................................................20 Implementing a Lean Six Sigma Project .............................................24 Project Initiation ..........................................................................24 Project Execution.........................................................................26 Project Communication...............................................................30 The Future of Lean Six Sigma in Government....................................32 Acknowledgments..............................................................................34 Appendix: Research Methodology......................................................35 Endnotes ............................................................................................36 References .........................................................................................38 About the Author ...............................................................................39 Key Contact Information....................................................................40 3
  4. 4. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA F O R E W O R D On behalf of the IBM Center for The Business of Government, we are pleased to present this report, “Improving Service Delivery in Govern- ment with Lean Six Sigma,” by John Maleyeff. Since the passage of the Government Performance and Results Act of 1993, there has been increased interest in the federal government on improving service delivery and delivering results. The 2007 Program Assessment Rating Tool scores for 977 agencies indicate that a key improvement area in the federal government is the execution and delivery of results. Dr. Maleyeff’s report is a comprehensive review of how public sector managers can use Lean Six Sigma to improve the Albert Morales execution and delivery of results. The hallmark of an effective report on a complex topic is that it is writ- ten in layman’s terms for practitioners at all levels, particularly those interested in learning more about Lean Six Sigma. Dr. Maleyeff’s report sets forth specific actions that public sector managers can take in start- ing and implementing Lean Six Sigma projects, and provides the reader with a description of the Lean Six Sigma deployment process from program development to project implementation. The report highlights the need to translate the Lean Six Sigma methods from applications in manufacturing to the service-oriented environment of the public sector. Specifically, Lean Six Sigma needs to take into account the cross-functional flow of process and information, increased task variability, numerous handoffs, hidden benefits and costs, and the Monica Painter different terminologies that are characteristic of the service environment. The report cites several examples of successful implementation and appli- cation of Lean Six Sigma projects in the public sector. It also enumerates key success factors and potential pitfalls. In our research and past experi- ence, we have found that the number one success criterion in deploying Lean Six Sigma is the adamant commitment of senior leadership. 4 IBM Center for The Business of Government
  5. 5. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA As we head further into the 21st century, we hope that process improvement trends in government transformation, supported by the innovative application of Lean Six Sigma as described in this report, will lead to more efficient and effective use of citizen tax dollars by public sector managers in providing services that meet or exceed the needs of the public. Albert Morales Monica Painter Managing Partner Associate Partner IBM Center for The Business of Government IBM Global Business Services albert.morales@us.ibm.com monica.painter@us.ibm.com www.businessofgovernment.org 5
  6. 6. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA E X E C U T I V E S U M M A R Y Lean Six Sigma provides a means to improve the delivery of services using a disciplined, project-based Definition of Lean Six Sigma approach. It brings numerous advantages if imple- mented properly, but it also risks being regarded as Lean Six Sigma encompasses many common another management fad. In this report, guidelines features of Lean and Six Sigma, such as an empha- sis on customer satisfaction, a culture of continuous are recommended for the application of Lean Six improvement, the search for root causes, and com- Sigma in government. They are targeted to adminis- prehensive employee involvement. In each case, a trators responsible for a wide range of public-sector high degree of training and education takes place, services, including those provided to citizens and from upper management to the shop floor. those provided to internal customers. As methodologies, both Six Sigma and Lean have inconsistent leadership motivation, union rules and evolved from collections of techniques to compre- regulations, job security concerns, and a prevalence hensive management systems. Both strive to enhance of undocumented processes. Other characteristics customer service leading to sustained organizational unique to the public sector pose an additional success and both require a supporting organizational challenge, including skepticism about government, culture. Their approaches differ somewhat, leading legislative controls, competing special interests, the some to question their compatibility. But by under- election cycle, and term limits. standing their fundamental principles, the combined Lean Six Sigma can be a powerful means to enhance Some governmental entities have managed to sus- customer satisfaction while managing costs. tain a comprehensive improvement program over many years. These organizations possess some Managers of a service organization attempting to commonality, including: (1) they initiated and apply Lean Six Sigma often find their task compli- continue to preach a constancy of purpose based cated by two mitigating circumstances. First, much on a consistent underlying methodology; (2) their of Lean Six Sigma terminology and many of its tech- key leadership positions have been in place for niques were originally intended for manufacturing, lengthy periods of time; (3) they guarantee that and applying them to services has been challenging. employees will not lose their jobs as a consequence Second, services by their nature possess special char- of an improvement project; and (4) they measured acteristics, for example, the importance of informa- their time to success in years rather than weeks tion and the abundance of cross-functional process or months. flows. However, an increasing number of service organizations have applied Lean Six Sigma to their In this report, examples of successful process organizations, including public sector organizations. improvement programs are highlighted at the local, state, and federal levels. A number of Many of the potential barriers could exist in any improvement projects illustrating the range of service organization (public or private) but appear to Lean Six Sigma’s influence are also described. The exist in greater frequency in government, including Lean Six Sigma guidelines are presented as two sets 6 IBM Center for The Business of Government
  7. 7. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA of recommendations. At the program level, recom- mendations for creating a supporting infrastructure and organizational culture are presented along with a number of specific action items. At the individual project level, guidelines for structuring a Lean Six Sigma project are detailed. The creation of an infrastructure that supports the Lean Six Sigma program requires that attention be given to four goals: (1) deploy a sound, consis- tent, and robust methodology; (2) build trust by removing fear; (3) initiate long-term cultural change; and (4) communicate the vision to all stakeholders. Active commitment of leadership is a must, in both words and action. To further set the stage for a Lean Six Sigma pro- gram, it is recommended that: • A centralized focal point be created who is dedicated to firmly establishing the program within the organization • Departmental involvement be sought to create a working relationship and enhance credibility • Training be focused on a simple toolbox containing basic Lean Six Sigma skills • Skilled facilitators, who are critical to project success, be obtained externally and/or devel- oped internally Within a Lean Six Sigma program, specific projects will be initiated. It is recommended that each Lean Six Sigma improvement project consist of three distinct stages. During the project initiation stage, the guidelines recommend focusing on a structured mechanism for project selection and project team creation. A disciplined project management struc- ture is recommended for the project execution stage that ensures focus on root causes of problems rather than their symptoms. The project communication stage involves delivering project information early and often, using mechanisms that are accessible to as many employees as possible. www.businessofgovernment.org 7
  8. 8. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA Understanding Lean Six Sigma In their quest to grow and prosper, many busi- What Is Lean Six Sigma? nesses have combined two popular management Both Lean and Six Sigma have come to be consid- approaches—Lean and Six Sigma—with the inten- ered management approaches rather than a collec- tion of building a more robust version of each. tion of techniques. Some practitioners consider Lean The result is typically referred to as Lean Six and Six Sigma to be mutually exclusive while others Sigma. In this report, the application of Lean Six see more similarities than differences. Either way, it Sigma in government is explored and guidelines is useful for practitioners to understand the origins for its implementation are recommended. These of each approach and their philosophical roots. guidelines will consist of a disciplined, project- based approach that ensures effectiveness of improvement efforts. They will be useful to admin- Lean1 istrators responsible for a wide range of public- Lean can be defined as a management approach sector organizations that range in size from that seeks to maximize value to customers, both federal to local, and in function from revenue internal and external, while simultaneously remov- management to homeland security. ing wasteful activities and practices. It is based on the management system used at Toyota Motor Instituting a formal process improvement program Corporation, with Shigeo Shingo and Taiichi can provide great benefits. It can serve to consis- Ohno generally considered to be its architects. tently reinforce the notion that administrators have Womack, Jones, and Roos,2 in a worldwide study two important jobs—managing and improving. With of automobile manufacturing, used the term “lean” Lean Six Sigma, improvement projects follow a pre- to describe the activities that seek to minimize scribed mandate and structure, guaranteeing that waste, such as excess inventory and defective important problems are attacked using a sound and products.3 Their study concluded that Lean was consistent methodology. It can avoid pitfalls com- preferable to “mass production” prominent in the mon to efforts that address symptoms, rather than United States and Europe. Lean manufacturing causes, of problems and enforce the use of data in gradually found its way in the mainstream jargon decision making. during the mid to late 1990s. The consistency of approach provided by Lean Six Sigma enhances the effectiveness of project teams Definition of Lean Six Sigma and allows for the sharing of project results across the organization. Disciplined follow-up ensures that Lean Six Sigma encompasses many common project team recommendations are implemented features of Lean and Six Sigma, such as an empha- and tracked. But sustaining Lean Six Sigma requires sis on customer satisfaction, a culture of continuous a culture that actively supports process improvement improvement, the search for root causes, and com- in both words and actions. And the active commit- prehensive employee involvement. In each case, a high degree of training and education takes place, ment of leadership is a must. from upper management to the shop floor. 8 IBM Center for The Business of Government
  9. 9. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA Figure 1: Lean Six Sigma Builds on Practical Lessons Learned from Previous Eras of Operational Improvement Just in Time (1980s) Lean Production (1990s) (Kanbans, Pull systems, (“Machine that changed the world,” Visual management) “Lean Thinking,” Value stream mapping) Total Quality Management (1980s) Business Process Reengineering (Statistical Process Control, Quality (1990s) Deming/ Ohno circles, Kaizen, Culture change/bench- (Downsizing, “To be” processes, Lean Six Sigma (2000s) Juran (1960s/1970s) marking, Baldrige, ISO9000) Process owners) (1950s) (Toyota (14 production Motorola – Six Sigma points, system) (1980s) Statistical quality) GE (1980s-1990s) Six Sigma (Applied method for growth and productivity) Intensity of change Change Acceleration Process (CAP) (Change method and tools) Customer Partnering (GE Toolkit, Customer CAP) Process Improvement (New Product Introduction, Supply chain, Suppliers) Best Practices (Benchmarking, Across and outside of GE, Ending Not Invented Here) Work-out (Kaizen type, Cross functional teams, Boundarylessness, Values) Strategy (Number 1 and Number 2 in each business, Fix, close or sell) Source: IBM Institute for Business Value, Driving Operational Innovation Using Lean Six Sigma. Lean Thinking4 introduced many practitioners to Lean, example, Emiliani5 details how a manufacturer including a five-step application guide: (1) specify achieved significant profitability and growth, empha- value from the customer’s perspective; (2) identify sizing that the marketing, accounting, design, and the stream of processes used to provide value; sales departments needed to modify their operations (3) remove non-value-added activities from the value to support Lean. Lean, therefore, cannot achieve stream; (4) create pull by having all work initiated by sustained success unless executives, as well as mid- customer demand; and (5) strive for perfection. dle managers and their staff, are active participants. The application of Lean principles in healthcare, Six Sigma6 services, and internal business processes is now Six Sigma can be defined as a management approach under way. But since Lean was originally motivated that seeks to maximize profits by systematically by competitive pressures in manufacturing, much applying scientific principles to reduce variation and of its jargon and many of its techniques apply to thus eliminate defects in product and service offerings. manufacturing operations, and special efforts must In 1986, the foundations of Six Sigma were estab- be undertaken to successfully apply Lean to ser- lished by Bill Smith at Motorola Corporation in vices. For example, the relevance of the five-step response to product quality challenges. The applica- guide may not be apparent when applied to a ser- tion of Six Sigma contributed to Motorola winning vice or business process since inventory as such the Malcolm Baldrige National Quality Award generally would not exist. However, many of the (MBNQA7) in 1988. descriptive and intuitive tools of Lean apply nicely to services, and its overall goals do not conflict with The statistical roots of the term six sigma8 have those of a service manager. become less important as Six Sigma has evolved into a comprehensive management system. Many practitio- Successfully applying Lean requires a long-term ners, however, continue to view Six Sigma as a set of viewpoint that considers all stakeholders. That is, techniques that promote variance reduction. The popu- Lean will only succeed if the organization’s infra- larity of Six Sigma was boosted dramatically when it structure reflects a common focus, which is often was adopted by GE Corporation under the leadership difficult to achieve in a large bureaucracy. For www.businessofgovernment.org 9
  10. 10. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA Key Definitions Kaizen (pronounced k ı ´-zen) literally means “change for the better.” It is typically used to denote a short term ¯ (one-to-five-day) focused process improvement effort during which a multi-stakeholder project team works full-time on the project, often led by a professional facilitator known as a “sensei.” DMAIC is an acronym for “Define, Measure, Analyze, Improve and Control” and refers to a systematic five-step approach to running a process improvement project; its origins would be found in early quality programs such as the Plan-Do-Study-Act structure developed by Walter Shewhart in the 1930s. of Jack Welch. While Six Sigma is most easily under- But it is equally clear that differences exist. Lean stood in a manufacturing context, it can and has been managers tend to be somewhat holistic, satisfied applied to healthcare and other services. But it is not with removing wasteful activities that hinder their clear that all of the Six Sigma tools, particularly the ability to serve customers. Six Sigma managers tend statistically based methods, are necessary in services to be financially driven, focusing directly on cost or that professional service employees would be able savings or revenue increases as the criteria for success. to apply them as well as their more technically sophis- The similarities and differences of Lean and Six Sigma ticated counterparts in manufacturing. are listed in Table 1. Six Sigma projects are formalized and highly struc- It is easy to envision several varieties of Lean Six tured, making use of scientific approaches in the Sigma. A version offered here would be character- selection and management of projects. Six Sigma ized as follows. The Lean influence would cause projects use a DMAIC structure, considered by the organization to: (1) maintain an understanding many practitioners to be the primary reason for Six of both internal and external customers’ needs Sigma’s success. DMAIC enforces a high degree of and desires; (2) seek to maximize the value-added discipline and commonality in project organization, content of all processes; (3) constantly evaluate problem-solving tools, software, and terminology. employee incentives to ensure their alignment with systemwide performance objectives; and (4) look Six Sigma implementation would begin with execu- beyond strictly financially quantifiable cost savings. tive education followed by extensive training through- The Six Sigma influence would cause the organiza- out the organization. Typically, formalized levels of tion to: (1) stress data-driven decisions that are training would be established, with project and men- based on facts rather than opinions; (2) devote toring roles often defined by a “belt” level (for exam- resources to solving problems that present signifi- ple, master black belt, black belt, green belt, and so cant challenges to business success; and (3) imple- on). The tools of Six Sigma include well-known ment a consistent, highly structured project-based problem-solving techniques and popular statistical improvement regimen. approaches, and a common software platform would usually be integrated to achieve a consistent means Relationship to Performance of internal communication. Six Sigma black belt certification is becoming a standard by which many Measurement quality practitioners are judged. Confusion often exists concerning how process improvement relates to performance measurement, which many governmental entities have embraced Lean Six Sigma as an important component of their management Despite their disparate roots, it is clear that Lean and system. Performance measurement can and possibly Six Sigma encompass many common features, such should play a key role in an effective process as an emphasis on customer satisfaction, a culture of improvement program. But process improvements continuous improvement, the search for root causes, are not a natural consequence of effective perfor- and comprehensive employee involvement. In each mance measurement. That is, a process improve- case, a high degree of training and education takes ment mentality will not take root without additional place, from upper management to the shop floor. 10 IBM Center for The Business of Government
  11. 11. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA Table 1: Comparison of Lean and Six Sigma Focal Point Lean Six Sigma Similar Tendencies Main goal Organizational survival and/or growth through superior and improving customer satisfaction. Executive Must be committed and actively involved in the program’s implementation and operation. influence Tools and Include basic root cause analysis, problem solving, process analysis, and data analysis techniques techniques. Employee Employees are trained and encouraged to contribute to problem solving and to identify involvement problems as they occur. Application Initially focused on manufacturing but can and has been applied to other industries, areas including service, healthcare, and education. Potential Differences Project Tend to be expeditious Kaizen projects Tend to be deliberate projects consuming management completed in a few days with the team multiple months using a disciplined structure. working full-time on the effort. Project Tend to focus on improving customer service Tend to focus on improving customer service focus by minimizing wasteful practices. by minimizing variation and reducing errors. Project Tend to be based on removing significant Tend to be based on a quantitative analysis selection waste and/or adding more value for custom- of cost savings and/or revenue enhancements. ers, with multiple criteria used as justification. Analysis Tend (traditionally) to be geared toward descrip- Tend (traditionally) to be geared toward statisti- techniques tive displays (e.g., process maps), root cause cal data analysis, controlled experimentation, analysis, and mistake proofing. and optimization. commitment and resources. In fact, performance Understanding variation is crucial measurement systems can pose a barrier unless Contemporary quality management offers a administrators are cognizant of the following: “process oriented” viewpoint, where the goal of data is to create a fundamental understanding Recognizing the value of performance of the process that generated the data. This goal measurement data in process improvement cannot be achieved unless the existence of vari- Most performance data are designed to evaluate ation is understood. For example, the number of effectiveness by focusing on metrics that repre- phone calls received by a municipality will vary sent how well and how efficiently services are from month to month, even if all of the service provided. While these “outcome” data can be processes remained unchanged. An appropriate valuable in highlighting areas of concern, their phrase would be “the data changed but the role is often less valuable during improvement process remained the same.” projects that require “process” data. An important Administrators who do not appreciate variation reason for this disconnect is that most service will often react to changes in the data even processes flow across departments and it is diffi- when no important process changes have cult to attribute overall performance to any single occurred. These reactions waste time and result department. For example, a finance department in frequent priority adjustments as new data may experience complaints about the accuracy arrive followed by the inevitable over-reaction. of bills, but the root cause of the inaccuracies Employees grow frustrated and frequently resort could be found in another department that pro- to the well-known practice of gaming perfor- vides the finance department with billing-related mance data. information. An added data collection effort would be required to determine the root cause of the department’s billing inaccuracies. www.businessofgovernment.org 11
  12. 12. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA Lean Six Sigma in the Public Sector Today, many public sector managers are well aware They began by employing a full-time administra- of quality and process improvement methodologies. tor to oversee the program’s implementation, but The government division of the American Society this position was often considered temporary for Quality, for example, includes about 1,000 until the program was up and running so as not members in the United States and Canada.9 to create an unnecessary bureaucracy. However, a champion for the effort will continue to be Many such managers across the nation are now needed in the organization. applying various process improvement methodolo- They offer a guarantee to employees that no gies within the public sector. Most have met with layoffs will result from a process improve- mixed success, in many cases applying proven ment project. methods periodically but not systematically. Readers interested in the research methodology, including They make conscious efforts to communicate how many of these individuals participated in the program successes internally, such as posting effort, should refer to the Appendix of this report. project results electronically or placing story- boards in prominent locations. Success Factors and Examples They face similar challenges, revealed by Organizations that have maintained a long-standing responses to a question asking respondents to and comprehensive process improvement program consider a list of 20 potential organizational bar- such as Lean Six Sigma possess many common fea- riers, where most respondents chose the majority tures. It is clear that these features enhance their of the list as at least somewhat troublesome. ability to sustain the efforts over a period of time. They did not achieve success overnight, with They have been inspired by influences emanat- most taking several years to create a culture that ing outside of the public sector, usually a leader characterizes and sustains their program. with business experience. City of Fort Wayne They have experienced little leadership turnover. Since his election in 2000, Mayor Graham Richard They paved the way for the program’s imple- of Fort Wayne, Indiana, has led a Lean Six Sigma mentation by removing organizational barriers effort. The result is savings estimated to be about and modifying its culture. $11 million, with no tax increases and increases They focus on certain underlying principles in citizen satisfaction. The mayor attributes his and maintain a consistent conceptual frame- 16-percentage-point re-election in 2004 to enhanced work, based on Lean and/or Six Sigma, or alter- customer service. While working in the private sector, natively Total Quality Management (TQM),10 the Richard founded the TQM Network and had firsthand MBNQA guidelines, or the family of standards experience with Six Sigma. He brought an entrepre- set by the International Organization for neurial spirit to the city and has devoted consider- Standardization (ISO).11 able energy to the Lean Six Sigma efforts. 12 IBM Center for The Business of Government
  13. 13. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA Lean Six Sigma in the Department of Defense In the public sector, the Department of Defense (DoD) has been a leader in the implementation of Lean Six Sigma. The summary below offers an overview of activities now in DoD. In the Office of the Secretary of Defense In April 2007, the Office of the Secretary of Defense publicly articulated the need to institute a framework to sup- port the acceleration of transformation throughout the department. The initiative was called Continuous Process Improvement and Lean Six Sigma (CPI/LSS). Supporters of the transformation initiative include DoD senior lead- ers who have experience within the private sector and who have seen firsthand the success experienced with the use of continuous process improvement and Lean Six Sigma. The CPI/LSS initiative includes the CPI/LSS Senior Steering Committee, which will guide the development of a new CPI/LSS Program Management Office. The new Program Management Office (PMO) will lead DoD-wide CPI/LSS activities by tracking progress and results, as well as formulating an incentives program to encourage further use of CPI/LSS methods throughout DoD. The PMO is also planning to issue DoD-wide CPI/LSS goals, including using CPI/LSS in individual performance objectives. Currently, efforts are under way to complete an initial set of CPI/LSS projects and refine priorities that establish an increased number of targets of opportunity within DoD. In the United States Army The challenge for the United States Army now is to broaden the number of adopters within the service. The Army is increasing the number of CPI/LSS projects within the service. As a key first step in gaining wider acceptance of the use of the CPI/LSS tools, the Army recently issued a single large contract to support the deployment of Lean Six Sigma. In the United States Air Force The United States Air Force has been involved with Lean since 1983. In the early 1980s, the Air Force established the Lean Aerospace Initiative (LAI), which had been fostered by industry leaders. The Air Force now has several “islands of excellence” in regard to CPI/LSS, particularly in the depot and maintenance areas. Lean Six Sigma has not yet been fully used in the Air Force’s administrative and transactional processes. With the successes of CPI/ LSS achieved at Tinker Air Force Base and Warner Robbins Air Logistics Center, there is now broader acceptance of the approach. Air Force senior leadership strongly supports the use of the CPI/LSS approach and has com- municated the importance of the use of these tools throughout the Air Force in several memorandums from the Secretary of the Air Force. In addition to their communications strategy, the Air Force also created the Air Force Smart Operations for the 21st Century (AFSO21) initiative, which has given an overall organization focus and direction to further drive the deployment of CPI/LSS methods across the entire Air Force. With several large contracts now in place to provide funding to receive advice and assistance, it is expected that the Air Force will quickly spread this approach across all areas within the service. In the United States Navy The United States Navy is further along than either the United States Army or the United States Air Force in the adoption and use of CPI/LSS tools. They now have built an extensive knowledge and experience base on the use of CPI/LSS. There are currently major Lean Six Sigma deployments running in Space and Naval Warfare Systems Command (SPAWAR), Naval Sea Systems Command (NAVSEA), and the Naval Air Systems Command (NAVAIR). Deployment of CPI/LSS in NAVSEA and NAVAIR has demonstrated clear success in developing the internal capa- bility to train and execute projects within those commands. The Norfolk Naval Shipyard is now expanding its use of Lean Six Sigma. — Monica Painter and Mark McDonald IBM Global Business Services www.businessofgovernment.org 13
  14. 14. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA The program includes a part-time program man- action plan to the department’s senior leaders. ager, in place since the program’s inception, who After the course, they work to complete the action is certified as a Lean Six Sigma master black belt. plan and report the results. For every dollar invested Thirty employees are trained as black belts and in the training program, the department is seeing a about 100 more are trained as green belts; they $23 benefit. all work on improvement projects along with hold- ing full-time operational or managerial positions. National Nuclear Security Administration Green belts are trained in the same tools as black As a separately organized (semi-autonomous) belts, with the latter receiving more in-depth train- agency within the U.S. Department of Energy, the ing, particularly in statistical techniques. National Nuclear Security Administration (NNSA) has accomplished its missions of nuclear weapons The program manager works with the administration stewardship, nuclear nonproliferation, and providing to choose projects, target candidates for training, the Navy with nuclear propulsion, using a group of and mentor individuals during the training process. independent private-sector contractors who provide He has also developed and, until recently, delivered both managerial and operational services. Through the green belt training program. Results of projects benchmarking of these contractors and other public and information on the program are available to and private organizations, the NNSA identifies best employees in their departments and available to practices in terms of not only what activities take the public on the city’s website.12 place but also how internal processes are managed. In particular, NNSA has adapted the practice of Florida Department of Revenue nurturing an environment that encourages processes The Florida Department of Revenue initiated “Six to change over time through formal process Sigma Light” in 2003. “Light” refers to the depart- improvement mechanisms. ment’s effort to customize the program by beginning with basic Six Sigma and Lean tools. They also intro- While NNSA and its predecessors have employed duced the program gradually so it would not appear various business process methodologies over the last to be a heavy-fisted corporate mandate. The depart- two decades, their Lean Six Sigma initiative is rela- ment emphasizes category 6 (process management) tively new and has been aggressively pursued, with of the MBNQA criteria, which includes how an about four to six projects being performed at any organization maintains a sustainable system of one time. Application areas include procurement, process design, management, and improvement. finance, hiring, complaint resolution, travel manage- ment, and processing security clearances. The focus A major emphasis involves benchmarking other public- of the projects tends to be reducing delays in service and private-sector entities to find ideas, tools, tech- delivery while maintaining strict quality require- niques, and business practices that can be adapted ments. Projects generally result in the development to the organization, focusing on a formal structure of standard operating procedures in ISO format that and the use of basic tools. Their internal newsletter include helpful mechanisms such as flowcharts, contains information on improvement projects, and checklists, standard data entry sheets, and informa- an internal web page communicates program initia- tion handoff forms. tives to employees. These communication mecha- nisms are designed to encourage learning and best The organizational commitment is evident in their practice sharing. senior management performance standards that include requirements for championing, implement- The department’s training program is designed to ing, and conducting process improvement projects. be results-oriented, with education and application Lean Six Sigma and process improvement require- performed concurrently. Each participant in the six- ments cascade through the management review month training program attends classes one or two process down to the line management level. Formal days each month. Simultaneously, they each join a quarterly briefings monitor progress on each project, team to define a real-world problem, collect data and semi-annual or annual briefings are held for to validate the extent of the problem, analyze root follow-up of completed projects. causes, propose potential solutions, and present an 14 IBM Center for The Business of Government
  15. 15. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA Using Lean Six Sigma for Improvements Similar features were also noted in successful individ- ual projects, even in organizations that would not be characterized as progressive. The projects tended to employ a formalized project structure, similar to DMAIC, at times with minor modifications. The tools used during the project were very basic techniques that are easy to apply by non-technical employees. These methods included many root cause analysis tools and some very basic statistical tools. Lean Six Sigma to Improve Tax Collection The city of Hartford, Connecticut, successfully reduced the processing time for checks in their tax collection office. Most checks are now processed in less than one working day, resulting in signifi- cantly higher interest earned by the city. After creating and studying a display of the workflow, project team members were able to remove redun- dant tasks along with tasks that currently have no real value. More specific job responsibilities were also assigned and the resulting work activities were standardized. Administrators cite the generation of an “elevator speech” early in the project as an important communi- cation mechanism. This short and simple statement summarized the project’s goals and benefits to the city. It was used by team members to communicate a con- sistent message to fellow employees, ensuring trans- parency and heading off potential misperceptions. Lean Six Sigma to Improve Classified Information Review Process Based on feedback from customers and manage- ment that the review process for classified informa- tion was complete and accurate but not always Source: IBM Institute for Business Value, Driving Operational Innovation Using Lean Six Sigma. timely, a team of NNSA staff members requested and received approval to initiate an improvement project. Using the DMAIC methodology, the project After making process modifications, standard operat- team employed process mapping and an associated ing procedures were developed and implemented. analysis of potential failures to describe the current While doubling the information available to manage- process and highlight causes of delays. ment for tracking customer requirements and for resource leveling work, the completeness of system The team found that inconsistent use of a tracking data improved dramatically as did overall cycle time. database, informal prioritization, inconsistent docu- mentation, inter-agency delays, and unclear follow- up activities hampered the process’s effectiveness. Lean Six Sigma to Improve Pothole Repair A significant number of pothole complaints received www.businessofgovernment.org 15
  16. 16. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA in Fort Wayne, Indiana, motivated a project in the which increased employee satisfaction and motivated Street Department. The project team employed basic more employees to help with future projects. tools, mainly the creation and analysis of process flow diagrams, along with a simple analysis of data Lean Six Sigma to Improve Vehicle using dot plots and Pareto analyses. The team stud- Maintenance ied the current process by identifying unnecessary In Oregon’s Lane County, a process improvement steps and generating ideas on how inefficient project was initiated after a fatal accident that resulted activities could be done more effectively. in an inspection by the Occupational Safety and Health Administration and subsequent citation for non-compli- The data, organized by location, highlighted that ance with safety requirements. During early stages of repair time delays were weather-related and ran- the project, a systematic audit was performed to iden- domly spread across the city, rather than isolated tify gaps between the county’s safety procedures and in particular areas. Changes were made to the the corresponding regulatory requirements. Based on complaint-receipt and repair-order distribution this audit, it was discovered that no standards existed activities, the workforce was redistributed to for pre-trip vehicle inspection of heavy equipment. respond more quickly, and various other wastes were removed from the process. Average repair The resulting improvement effort focused on improved time was decreased from about four days to at most safety rather than achieving a more narrow compli- three hours using the same number of employees. ance to regulatory guidelines. The project studied cur- rent practices, identified areas for improvement, and Lean Six Sigma to Improve Licensing Services created standard procedures for pre-trip inspections. The Washington State Department of Licensing iden- The project team included the county’s safety commit- tified those offices having excessive customer wait tee along with operational personnel from multiple times for obtaining or renewing a driver’s license. divisions, including landfill and roads maintenance. Starting at the office with the longest waits, project teams were formed at each location. By focusing data Unique Organizational collection on finding process bottlenecks, solutions were implemented that included changes to software, Characteristics queue organization, and equipment layout. Implementing Lean Six Sigma always requires care- ful consideration of the special organizational fac- Most offices achieved a 50 percent or more wait time tors that may work for or against its success (see reduction along with an increase in customer satis- Table 2). Some of the potential barriers that could faction. During the projects, many quality-of-work- occur in the private sector are found with greater life issues were identified and changes were made frequency in the public sector: (for example, installing a new office refrigerator), Table 2: List of Potential Challenges Challenges Consistent with the Private Sector Challenges Unique to the Public Sector • Inconsistent leadership motivation • Unique human resource practices • Management competency in process • The election cycle and term limits improvement • Attitude of employees regarding stability and • Culture that considers time devoted to job security improvement less valuable than time • Legislative controls devoted to “real work” • Competing special interests • Union rules and relations • Revenue not directly linked to value provided • Technical skill of employees • Many undocumented processes 16 IBM Center for The Business of Government
  17. 17. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA • Inconsistent leadership motivation due to • Significant task variability. The duration of ser- competing priorities, personal goals, or polit- vice tasks (e.g., repairing a pothole, renewing a ical realities. license) is usually variable, making the control of workflow difficult. • Management ignorance of, or experience with, process improvement. • Cross-functional process flows. Service pro- cesses typically flow across departments within • A culture that considers time devoted to an organization where employees work under improvement much less important than time competing incentives and often suffer from devoted to normal work activities. long-standing rivalries or other conflicts that • The existence of union rules and relations that hinder their coordination. hinder the modification of work assignments. • Many handoffs of information. The importance • Service employees that are typically not trained of information and a cross-functional process flow or experienced in applying sophisticated quanti- often leads to mistakes or miscommunications, tative methods. such as use of a term or phrase that has different meanings to workers in different departments. • Many undocumented processes that preclude a consistent, organization-wide understanding of • Numerous management or technical reviews. how a service should be provided. Due to the need to seek approval or to have text or figures verified, many services include Several additional challenges particularly unique to “inspections” by technical staff or management, the public sector include distinctive human resource which increases the cost of providing the ser- practices; the election cycle and term limits; stability vice and delays service completion. and job security concerns; legislative controls; and • Hidden benefits and costs. While non-financial competing special interests. Additionally, revenue is performance metrics are common, quantifying typically not directly linked to value, since most of the financial benefit of improved service deliv- the funding of services derives from tax revenue ery that results in better customer satisfaction paid by citizens, who traditionally have low expec- is difficult. tations, making them relatively apathetic and there- fore not likely to routinely complain or offer • No explicit motivation for urgency. Employees suggestions for improvement. may unwittingly cause serious delays by being unaware of the overall service process and Unique Characteristics of therefore not cognizant of task priority, or they may simply be unmotivated to sacrifice their Government Processes comfort for the good of the organization. To understand how Lean Six Sigma should be applied in government, it is important to describe Some of the pitfalls that could result from ignoring a public-sector service process in conceptual terms. these characteristics include: (1) focusing an To this end, the results of a prior study are useful. improvement effort on speeding up document This study by the author concluded that most flow, when the effort may be better focused on service processes share a number of common improving the quality of the information contained structural characteristics and many of these on, or missing from, the documents; (2) creating a characteristics would not be found to the same process improvement team without membership extent in manufacturing.13 They are: from all departments involved in service delivery; (3) solving local problems that are impacted by • Importance of information. Either the service cross-departmental miscommunication; (4) allow- itself consists of information (e.g., tax advice) ing employees to remain ignorant of overall process or the service includes important information flow; (5) creating inspections in response to prob- (e.g., instructions on a utility bill), and this lems, a discredited industrial practice, rather than information should be measurable, complete, finding ways to eliminate the need for these reviews; and understandable. and (6) using financial justification alone to decide on resource allocation to improvement projects. www.businessofgovernment.org 17
  18. 18. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA Starting a Lean Six Sigma Program The premise that Lean Six Sigma can form the basis Deploy a sound, consistent, and robust of a systematic and disciplined process improve- methodology. ment program in government has been supported. The establishment of a consistent philosophical It is clear, however, that the program will not be foundation, supported by an accompanying method- effective without considerable employee involve- ology, is critical. Leadership is best advised to focus ment from top leadership to frontline employees. on the methodology with which they are familiar, They must all believe that a personal benefit will as the specific methodology is less important than result from their active involvement. As such, Lean a consistent and viable implementation strategy. Six Sigma will not be effective if used as a mecha- The research has shown that Lean Six Sigma can nism for cutting short-term direct payroll costs be effective, along with other methodologies such through layoffs. as the MBNQA criteria or TQM. The goal of Lean Six Sigma should be to improve The foundation must be easy to understand but not service and ultimately lower the cost of its deliv- be reduced to clichés. The research has found that ery. But this goal should be accomplished through successful programs share not a methodology but a a combination of employee attrition, workforce common set of principles. For example, they con- reallocation, and contractor attrition, so that addi- sider citizens to be customers rather than nuisances. tional services are provided to the public. In this And they also believe that individual employees can way, newly elected leaders may be motivated by a make a difference, especially in terms of their ideas desire to enhance their status in the community in that can help management make positive change. a very visible way. To achieve these ends, Lead Six Sigma should be implemented in a carefully Outside consultants can be helpful during early thought-out manner. stages of program implementation. But they can also be a hindrance when their approach is incon- Infrastructure Considerations sistent with the organization’s culture or when they are seen as being held solely responsible for the Management commitment to a Lean Six Sigma program’s success. process improvement program must go beyond slogans, banners, or motivational speeches. The Training needs to be consistent with the methodol- leadership team should exude a constancy of ogy and provided in a just-in-time manner, allowing purpose, along with discipline and patience that employees to immediately apply the concepts and allows the program to take root. The management techniques covered. The creation of a common team must be made responsible and accountable language, approach, and toolbox will enhance for both managing the organization and improving communication across the organization. The meth- its effectiveness. The creation of an infrastructure odology, however, cannot be viewed as inflexible. that sustains requires attention be given to the It should be allowed to evolve as circumstances following four actions, which are summarized in change, such as during times of leadership turnover. Table 3. 18 IBM Center for The Business of Government
  19. 19. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA Table 3: Elements in Developing a Lean Six Sigma Program Infrastructure Deploy a sound and robust methodology • Consistent philosophical framework • Easily understood but no clichés • Consistent just-in-time training • Flexibility to allow evolution Build trust by removing fear • Employee involvement critical • No layoff guarantee • Celebration of success Initiate culture change • Gradual implementation • Focus on “process,” not blame • Priority to improving and doing work • Tangible benefits for all employees Communicate with stakeholders • Early and continuing awareness • Tangible benefits to be realized • Progress documented visibly • Top leader involvement Implementation Create a centralized focal point • Needed to maintain persistence • Skilled, enthusiastic, and impartial • Best if temporary Ensure departmental involvement • Liaison or similar relationship • Supports credibility and awareness • Eliminates repeated use of personnel Focus on a basic toolbox • Basic tools of Lean Six Sigma • Understanding and transparency • Enhanced employee motivation Obtain externally and/or develop • Critical to project success skilled project facilitators • Assertive, competent, and impartial • Ensures project timeline met Build trust by removing fear. process improvement activity. However, some To obtain and maintain organization-wide support, reassignments (either more or less individuals leaders should address the fear that will inevitably assigned to a specific task) might result from a Lean accompany Lean Six Sigma initiation. This fear is Six Sigma project. In some cases, for example, for- mainly due to job insecurities, including the possi- mal agreements between union and management bility of layoffs or punishment for speaking honestly were modified to contain the no-layoff guarantee. during project sessions. Leadership should be cogni- zant of the very real need for employee involve- Over time, it will become apparent to union mem- ment. So while it may appear that lowering costs bers and other employees that indeed they can through improvement will only occur with layoffs benefit from Lean Six Sigma. In particular, their job or other payroll cuts, successful programs focus on satisfaction will increase as they are allowed to par- using normal attrition to reduce operating costs. ticipate in determining how their job is done. Another benefit to both management and staff would be con- The author believes that a clear statement must be fidence that the efficiency and effectiveness of their made by the leadership team guaranteeing that no operations compares favorably with those in the pri- reductions in force will take place as a result of a vate sector, eliminating concerns of privatization. www.businessofgovernment.org 19
  20. 20. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA likely, especially miscommunicating the program’s Staying the Course intentions. In one case when Lean was introduced into an organization, a rumor began that Lean meant When a new leader is elected, it is incumbent “Less Employees Are Needed.” In such cases, lead- upon remaining administrators to work early and ership needs to take quick and decisive action. aggressively to maintain the Lean Six Sigma effort, especially when the new leader lacks business experience or possesses a general skepticism of Communicate the vision to all stakeholders. government’s effectiveness. One useful mechanism Since stakeholder involvement is critical, all affected would be the utilization of process maps, standard procedures, and process data during briefing ses- constituencies should be kept abreast of the program’s sions so that their value, and in turn the value of development early and often. This communication the Lean Six Sigma program, becomes evident. should also address the tangible benefits that should accrue to each stakeholder, while avoiding promises that may not be realized. The phrase “under promise Transparency is critical so that employees understand and over deliver” is appropriate. that Lean Six Sigma will provide a benefit rather than a threat. To this end, it is recommended that sugges- Early communication with employees is a must. But tions made during project meetings that affect quality management should be aware that not all employees of work life be taken seriously. One example was have access to the same communications mechanisms noted where employees asked for and received a new as management. For example, certain employees may office refrigerator, initiated by a suggestion made dur- not be assigned an e-mail account, and some employ- ing a process improvement project, even though this ees may not have been assigned a mailbox. Once the action would not improve the service being analyzed. communication is begun, feedback from employees should be encouraged, since in many cases an imple- mentation detail is easily changed to accommodate Initiate long-term cultural change. the needs of a constituency group. Gradual but steady implementation is generally preferred over a massive rollout that can give rise The leadership team should be involved in a to a “this too shall pass” passive-aggressive reaction. clear, convincing, and vocal way. Making site visits, During this time, management at all levels must spending time in each training wave, and dropping continuously reinforce a focus on “process” by in on project meetings are examples of leadership avoiding the practice of assigning blame for prob- action that signals their commitment. Monitoring lems that occur. Supervisors must allow workers to progress on a monthly basis through Lean Six Sigma devote attention to improving their work in addition status meetings may also be considered. to doing their work. And workers should see that tangible benefits can be derived from their participa- As projects commence, presenting the results inter- tion in improvement efforts. nally using posters or other visible media, placed prominently in a common work area, is worthwhile. When management and staff on a project team Certain external customers, such as contractors, are treated as equals, the line separating their advocacy groups, and ordinary citizens, can help responsibility blurs. Staff appreciate being able spread the message if they can be convinced that to control how their work is done. Managers the program is in their self-interest. appreciate having staff members that are moti- vated to provide excellent service to customers. Employees at all levels who are members of a Implementation Considerations process improvement team that makes improve- The implementation of Lean Six Sigma should be ment suggestions have a natural desire to see undertaken in ways consistent with the traditions of that their ideas produce favorable results. the organization and the personality of its leaders. Certain actions could be considered essential for Maintaining momentum is critical since the culture effective implementation: should be allowed to evolve naturally. Mistakes are 20 IBM Center for The Business of Government
  21. 21. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA Create a centralized focal point. While the chief executive will be called upon to The Tortoise Wins provide visible leadership, he or she will be unable to manage detailed implementation activi- When establishing a Lean Six Sigma program, persistence is vital. Terms such as “diligence,” ties. Creating a steering committee or assigning a “resolve,” “discipline,” “tenacity,” and “patience” high-level executive to this task should be consid- have been applied to a leader who will not let the ered, but it is important to avoid establishing a program “die” even when the inevitable crises, or new bureaucracy. other changes and distractions, occur. The organization may wish to assign a program administrator who would be dedicated to firmly Or a department may include one or two supporters establishing the program within the organization. who participate repeatedly in improvement proj- This position would work closely with the chief ects. When this occurs, two potential effects are executive. He or she should be skilled and enthusi- likely that decrease the chance of long-term viabil- astic. Excellent interpersonal and communication ity. First, those few individuals will eventually find skills are also critical. And the program administra- that their workload increases or their merit rating tor should be viewed across the organization as an suffers due to their participation in improvement impartial arbitrator. projects. Second, due to transfer or retirement, these individuals will eventually leave the department Ideally, a full-time program administrator will main- and their replacements will likely not be encour- tain the position for as long as it takes, since the ulti- aged to participate. mate goal is to infuse a process improvement culture throughout the organization. Ultimately, Lean Six Sigma efforts would be decentralized and become a Focus on a basic toolbox. It would be rare for a governmental entity beginning routine component of each department’s activities. a process improvement effort to require more than Organizations that have decentralized from the start the basic tools of Lean Six Sigma. Further, keeping have noticed that lack of a standard project structure, the tools simple will enhance its acceptance among training program, and communication mechanism both managers and staff, creating a sense of mutual has hindered cross-departmental communication. understanding and transparency. The training of proj- ect management and project communication skills Ensure departmental involvement. should also be included. And the training should It is helpful to create a working relationship between always occur on a just-in-time basis to prevent the the program administrator and each department or entropy that often accompanies training programs. operating unit. For example, each department may wish to appoint a process improvement liaison, or “cham- Table 4 on page 22 presents elements that could form pion.” The liaison will serve as a useful communication the basis of a training program for public-sector link so that information from the leadership team is employees. Ideally, the training program will be spread presented to employees via a trustworthy source. over a period of time and include an application proj- ect so that students apply the tools as they learn them. A liaison can help present the program as valuable For example, the students could meet two consecutive to the department rather than pushed onto the days, every second or third week, while working on a department from headquarters. He or she can also project. This program could continue until six to eight act as mentor for employees just getting involved full days of training have been completed. in project improvement teams. And a liaison can be very helpful in identifying projects that can When employees experience firsthand the effect the solve important problems while having a good tools can have on improving their work, motivation chance of success. to take an active part in future projects increases. Other employees viewing project results will under- When departmental involvement is inconsistent, stand the tools being applied and become less several risks are created. Some departments may intimidated and often volunteer for membership on simply not take part in the improvement activities. subsequent project teams. An additional advantage is www.businessofgovernment.org 21
  22. 22. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA Table 4: Elements of a Lean Six Sigma Training Program Main Topic Coverage Introduction to • Customers (constituency receiving value from a service process) Lean Six Sigma and • Stakeholders (organizations that are involved with a service process) Definitions • Value-added activity (task for which a customer is willing to pay) • Waste (time spent in other than value-added ways) • Green and black belts (classification of employees based on their level of expertise in Lean Six Sigma principles and tools) • Project team roles (management, administrators, and staff) DMAIC Project • Define (create problem statement and customer value definition) Structure • Measure (map the process and collect associated data) • Analyze (identify problems and significant waste) • Improve (find ways to eliminate waste and/or add value) • Control (develop implementation and follow-up plan) Process Mapping • Flowchart (basic display of service process flow) • Spaghetti chart (display of facility layout with process flow) • Time value map (timeline showing lead time and value-added time) • Value stream map (display of a process with supporting data) • Consumption map (map of customer interaction with a service) Root Cause • Failure Modes & Effects Analysis (or FMEA, prioritizes causes of poor Analysis Tools performance) • Five Whys (method that moves from symptoms to root cause) • Affinity building (brainstorming activity to quickly organize details) • Cause-and-effect diagram (display of potential problem causes) Data Analysis Tools • Data collection basics (check sheets, surveys, data entry forms) • Pareto analysis (ranking of problem importance) • Run charts (simple plot of process data over time) • Calculations (average, standard deviation, etc.) • Scatter plot (display to determine if a relationship exists) Improvement • Five S (methods for organizing a workplace) Techniques • Mistake proofing (mechanism to prevent problems and errors) • Standard work (consistent structuring of a work task) • Standardization (consistent operation of a service process) • Visual workplace (highly visible communication mechanisms) that training costs are allocated over a larger number customer satisfaction analysis, or revenue manage- of employees. ment. They are called upon to contribute to improvement projects on an as-needed basis. In some organizations, a few specialized internal or external experts can be developed or made Obtain externally and/or develop internally available when their need arises. For example, the skilled project facilitators. Florida Department of Revenue includes personnel The importance of skilled project facilitators cannot with expertise in statistical modeling in their various be overemphasized. Their function includes teaching, offices that do forecasting, measurement analysis, coaching, and mentoring, while guiding the team at 22 IBM Center for The Business of Government
  23. 23. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA a suitable pace. They must be assertive in order to overcome challenges such as dominant personalities and reluctant participants. For example, the facilita- tor must mitigate the effect of powerful team leaders whose “pet” ideas may not represent effective solu- tions. Other situations that must be avoided include the acceptance of opinions as facts, groupthink, feuding, rushing, digressions, and tangents. Facilitators must be assertive but impartial, so that team meetings move along at a steady pace with minimal diversions. Facilitators should possess breadth so that they understand the broad range of issues relevant to policy and administrative matters. They should have effective communication skills, and be able to work comfortably with both manage- ment and staff. In some organizations, external consultants have been used as facilitators with some success. In these cases, care must be taken to ensure consistency from project to project. Generally this can be achieved by forming a long-term relationship with a contractor so that their involvement is more one of partnership than supplier. If facilitators are to be developed internally, each must be chosen carefully since not every enthusiastic, tech- nically competent employee will make an effective project facilitator. www.businessofgovernment.org 23
  24. 24. IMPROVING SERVICE DELIVERY IN GOVERNMENT WITH LEAN SIX SIGMA Implementing a Lean Six Sigma Project Lean Six Sigma would be characterized by a strategic plan and that the anticipated benefits consistent and disciplined project methodology. outweigh the associated costs. Personnel and other Consistency is valuable because it creates: costs to execute a project would typically be (1) constancy of purpose, (2) the perception of understood. But estimating the benefits of improve- competency, (3) an environment where similar ment is difficult since they include some that are tools are applied in similar ways, (4) advanta- tangible and some that are intangible. Given the geous training conditions, and (5) effective com- difficulty in quantifying intangible benefits, it is munication across the organization. The project recommended that project approval be a leader- methodology detailed below incorporates the best ship decision, supported by an analysis that con- facets of Lean and Six Sigma. But it is not meant siders three sets of potential benefits: to be complete in all details, allowing for some local customization to fit the needs of specific 1. Financially quantifiable benefits can be pro- organizations. jected in monetary terms. Cost reductions such as labor, equipment, and material would Each Lean Six Sigma project should include three typically be included as well as revenue stages—Project Initiation, Project Execution, and increases such as taxes, interest, and fees. Project Communication—detailed below and For example, decreasing the lead time for summarized in Table 5. processing checks will result in increased interest earned. Project Initiation 2. Non-financially quantifiable benefits cannot “Preparation, preparation, and preparation” may be projected monetarily but can be quantified be thought of as the three things to remember when in other ways. This category is broad but initiating a process improvement project. Key suc- would include the projected number of cus- cess factors include involving key stakeholders on tomers (e.g., taxpayers, contractors) affected the project team, soliciting support from administra- in a positive way if the service were improved. tors, addressing political sensitivities, employing a For example, decreasing the wait time for skilled facilitator, consulting with customers, and license renewal will result in more drivers ensuring that the problem warrants commitment of who are able to renew their license in an the organization’s resources. An improvement proj- acceptable period of time. ect should be initiated based on a structured project 3. Intangible benefits cannot be quantified selection procedure and begun with careful selec- precisely, either financially or otherwise. They tion of the project team. include higher customer or employee satisfac- tion, better chance of re-election, and more Selection and Justification participation from employees in future proj- A decision to devote resources to an improvement ects. For example, among the benefits to con- project should be preceded by confirmation that sider may be the creation of a better employee the effort is consistent with the organization’s work environment. 24 IBM Center for The Business of Government

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