LEAN Ohio: Transforming State Government One Process at a Time

LEAN Ohio: Transforming State Government
One Process at a Time
By: Steve Wall, Director of Continuous Improvement, Ohio State
Government

Your Presenter Today

Steve Wall
Director of Continuous Improvement
Ohio State Government

• Appointed by four Governors in two states to direct their state-wide continuous
improvement efforts, which resulted in over $400 million in savings.
• He has served Governor’s from both parties and twice been a cabinet official.
• Testified before subcommittees of the US House of Representatives, the US
Senate and the US Secretary of Labor’s Office as an expert witness on
continuous improvement in government.
• An applicant, examiner, judge, member of the board of trustees and officer for the
Ohio Partnership for Excellence – the state’s Malcolm Baldrige Quality award
program.

© 2010 Guidon Performance Solutions, LLC. All rights reserved.
2

What We’ll Cover Today
• Welcome – Lean Six Sigma in Ohio State
Government
• Background and in the Beginning
• Results, Results, Results.
• Lessons Learned
• Next Steps

3

Background and in the Beginning
• No money
• Many MANY processes that have been
around a long time.
• Good Partnership with Union regarding
need for continuous improvement
• Some past success with Deming stuff
• Strong desire to make government
services simpler, faster, better and less
costly

4

Selecting The First Kaizen Event
• Planning or Pain?
• Confidence or Courage?
• Hurdles:
– An entire week?
– You are bringing in outsiders??
– The new process WILL be implemented
immediately and is not just a recommendation
to consider???

5

And The Winner Is…
The Bureau of Workers’ Compensation

The First Kaizen Event Team

By statute BWC has 60 days from receiving a protest to conduct the requested
hearing, but data showed it was taking an average of 142 days. In addition, it was
taking 27 days to inform the employer of the decision after the hearing was
conducted, for a total of 169 days of waiting.

6

Current State Business Process Map

• 87 steps
• 37 handoffs
• 20 decision points
• 12 delays

• A Kaizen team was created to reduce the duration of the appeals process.
The team created a business process map and identified the non-value-
added activities, analyzed solutions and completely redesigned the way
they conducted business.

7

The New Process for Hearings

• 27 steps
• 10 handoffs
• 7 decision points
• 2 delays

8

Before and After

Before

After

9

Projected Results
Measure Before Target Projected Difference

# of steps 87 27 69%
# of decisions 20 7 65%
# of delays 12 2 83%
# of handoffs 37 10 73%
Complaint lead
unknown 14
time
Hearing lead time 142 60 days 34 75%
Post hearing lead
27 4 85%
time
Cases going to
880 440 TBD 50%
protest
Potential savings (440 cases X $500) $220,000

10

How They Did It
• Created new customer focused process to
resolve complaints & issues before they
become a formal protest
• Everything goes through one funnel
• Employer complaint is accurately and timely
referred to proper subject matter expert
• Established detail performance metrics
• Creation of quality assurance function
• New forms created & approved in 4 hours
(a record!)

11

Sustained Results
• The team has been able to stay below the 60-day statute for scheduling
hearings for OVER TWO YEARS.
• They also made a 75 percent reduction in the time needed to inform an
employer of the decision after the hearing – from 27 days to an average of only
seven days.
• Most impressively, these significant gains did not come at the expense of quality
to customers. In addition to shortening the process, the team also made the
process less confusing, provided greater access and more convenient locations
for the hearings, and created a front-end mediation process to help solve
problems before they went to hearings – all of which saved considerable money
for Ohio businesses and taxpayers.
• Eric Burkland, President of the Ohio Manufacturers' Association attended the
team's end-week presentation and was impressed by the process and the
results.

"I want to congratulate the team for listening to their customers and having the
courage to make needed changes and improvements. We strongly endorse the
use of Lean tools in state government and feel Kaizen events like this one can
have a major impact on the business climate in Ohio," Burkland said.

12

First Kaizen Event Facilitated by State Employees
• Department of Taxation – Compliance Division

Current state: Sixty-six days to turn around taxpayer
correspondence

13

Backlog

Ninety day, 13,000 volume backlog

14

Current Business Process Map

New Process

15

Results

Measure Before Target After Difference

# of Steps 87 20

# of Decisions 25 6

# of Delays 7 1

#of Handoffs 11 8

# of Loopbacks 10 2
# of days to Sort
4 days
the Mail
Average of Work 90 days
14 days 2-4 days 58-86 days
on shelf 13,000 pieces
Lead Time 66-112 days 30 days 11-13 days 55-90 days

16

Success Increased Demand
• Thirty Lean Events in just over 2 years
– Eliminated over 2000 unneeded time-wasting
steps from government processes
– Cut over 60% of all steps documented during
Kaizen events, and 70 percent of delays (More
than 250 decision points, 200 delays and 350
handoffs eliminated from government processes
overall)
– Average Kaizen event reduced start-to-finish
process time by 41% (More than 1000 hours of
wait time overall, multiplied by the thousands of
customers that use those processes)

17

Biggest Successes
• From over 30 Lean Events, we present the “Kai-
Zenny” awards for best team performances in the
following categories:
– “Most Process Steps Eliminated”
– “Most near knockdown fights by team members in one
week”
– “Most Time Delays for Eliminated for Customers”
– “Biggest Kaizen Event Ever”
– “Most Money Saved by a Kaizen Event Team”
• And the winners are…

18

The “Kai-Zenny” Awards
In the category of: “Most Process Steps Eliminated”
And the winner is… The Ohio Department of Agriculture for eliminating 124
steps from the Farmland Preservation Application Process
• Ohio's 75,700 farms are crucial to our state. Food and agriculture contribute more than $98
billion annually to the Ohio economy. They provide jobs to one in seven Ohioans. And they
keep us fed with delicious sweet corn (Ohio is the nation's #5 producer), soybeans (#5),
cucumbers (#6), tomatoes (#6), and much more.
• To make this happen, the Ohio Office of Farmland Preservation helps farmers and local
officials in their efforts to preserve Ohio's agricultural resources. A state program purchases
easements from interested Ohio farmland owners, with easement transactions re-corded
on the property deed and thus transferred to all future landowners. This keeps the land
under private owner-ship while guaranteeing that it remains used for farming.
• The Farmland Preservation Office receives some 200 applications per year for this
program, but it was taking 18 to 24 months for accepted landowners to get their funds -- too
long for everyone. So the Ohio Department of Agriculture put together an improvement
team made up of office staff, landowners, Advisory Board members, county officials,
Federal officials, local sponsors, and others.
• When all the improvements are in place, the new process will take half the time. What used
to cover 18-24 months will be completed in 7-14 months.
• The team eliminated 124 process steps and 295 days of delay.

19

In the category of “Most near knockdown fights by
team members in one week”
And the winner is… The Department of Natural Resources

The team brought together
members of Ohio DNR, Ohio
EPA, U.S. Army Corp of
Engineers, and five members
of the coal mining industry to
take on the costly, complex,
time-consuming integrated
coal mining application
process.

20

In the category of “Most Time Delays Eliminated for
Customers”

And the winner is… Also The Department of
Natural Resources for eliminating almost a full year
from the Coordinated Application Process team.

• During two Kaizen events they saved businesses
applying to mine coal in Ohio a total of 224 to 359
days. Along the way they saved thousands of
dollars by reducing items like the buffer zone
variance document from 50 pages to 3-4 pages
and jurisdiction reports from 300 to 10 pages.

21

In the category of “Biggest Kaizen Event Ever”

And the winner is… The Department of Job and
Family Services “Show Us The Money” Kaizen
Event Team that improved the process for auditing
paid claim issues for long term-care providers.

• This Combined Proposed Adjudication Order
(CPAO) team consisted of over 30 participants
and 7 facilitators, that outgrew 3 large conference
rooms and 6 break-out rooms and plastered flip
chat paper up and down hallways.

22

In the category of “Most Money Saved by a
Kaizen Event Team”

And the winner is… A
Double Win for Job and
Family Service’s “Show
us the Money” team who
so far have recovered
over $33 million dollars
as a result of the event.

To see details of team
success, go to:
www.governor.ohio.gov/Def
ault.aspx?tabid=1465

23

Common Interventions
• Batch Processing
• Multiple levels of authority/signatures required
• Back and forth with customers clarifying
incomplete applications
• Applications / requests come to many places
• Complicated requests slow standard or easy
requests
• Rely on heroics
• “We thought the Feds, legislature, governor,
auditor, statute, said we have to it this way.”

24

Lessons Learned
• Senior management / sponsor must not just
support, but swear to implement
• No shirt, no shoes, no data – no event
• Don’t pull plug Wednesday no matter how
tempted you are
• Need trained, experienced Lean experts to lead
the event
• Follow up, follow up, follow up

25

Next Steps
• Value Stream Maps first to define and focus
Kaizen events
• Train more internal facilitators
• Develop better infrastructure to track follow up
and results
• Incorporate Lean principles in day to day
management and not just during Kaizen events

26

Questions?

27

Lean Six Sigma in Ohio State Government

Thank You
Steve Wall
Director of Continuous Improvement
www.governor.ohio.gov/LeanOhio.aspx

Guidon Performance Solutions
866-986-4414 or 480-986-4414
contact@guidonps.com
www.GuidonPS.com

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© 2008 Guidon Performance Solutions, LLC. All rights reserved. Guidon Performance Solutions is a licensee of LeanSigma®, a service mark of TBM Consulting Group.

LEAN Ohio: Transforming State Government One Process at a Time

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