Continuous Improvement in Government: Applying LEAN Principles Lean.pdf · 2016-03-20 ·...

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1 Q6σ Lean PIC, LLC Implementing & Sustaining Government LEAN Initiatives Continuous Improvement in Government: Applying LEAN Principles

Transcript of Continuous Improvement in Government: Applying LEAN Principles Lean.pdf · 2016-03-20 ·...

Page 1: Continuous Improvement in Government: Applying LEAN Principles Lean.pdf · 2016-03-20 · Implementing & Sustaining Government LEAN Initiatives 3 Q6σ 3 Lean PIC, LLC About QPIC &

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PIC, LLC Implementing & Sustaining Government LEAN Initiatives

Continuous Improvement in Government:

Applying LEAN Principles

Page 2: Continuous Improvement in Government: Applying LEAN Principles Lean.pdf · 2016-03-20 · Implementing & Sustaining Government LEAN Initiatives 3 Q6σ 3 Lean PIC, LLC About QPIC &

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Discussion OutlineDiscussion Outline

• Firms Overview• LEAN Overview• Approach to Serving Clients• Next Steps Discussion

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About QPIC & Daniel Penn About QPIC & Daniel Penn hh 55 Combined Years Consulting Experience55 Combined Years Consulting Experiencehh Government ExperienceGovernment Experiencehh Diverse MultiDiverse Multi--National Fortune 1000 and National Fortune 1000 and

Government Client BaseGovernment Client Basehh Wide range of LEAN Six Sigma and Process Wide range of LEAN Six Sigma and Process

Improvement Services.Improvement Services.hh Outstanding Rating by our Clients Outstanding Rating by our Clients hh USUS--SBA certified SDB, GNEMSDC certified MBE, SBA certified SDB, GNEMSDC certified MBE,

and DAS certified CT Businessesand DAS certified CT Businesseshh Focused Approach for Addressing Focused Approach for Addressing

ClientClient’’s Needss Needs

Page 4: Continuous Improvement in Government: Applying LEAN Principles Lean.pdf · 2016-03-20 · Implementing & Sustaining Government LEAN Initiatives 3 Q6σ 3 Lean PIC, LLC About QPIC &

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Holistic LeanHolistic Lean

LEAN ToolsMWM – Measure What Matters

Kaizens

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LEAN is based on:LEAN is based on:

The GoalThe GoalTo deliver continuously improving valueTo deliver continuously improving value--added added services (quality and speed of service) to customers services (quality and speed of service) to customers (taxpayers) at lower costs.(taxpayers) at lower costs.

Process ImprovementProcess ImprovementTo be able to identify key processes, how they are To be able to identify key processes, how they are performing and apply LEAN tools to make performing and apply LEAN tools to make improvements in reducing costs/wastes and improvements in reducing costs/wastes and enhancing revenues.enhancing revenues.

People are the BusinessPeople are the BusinessThere needs to be a high respect for people. A There needs to be a high respect for people. A constant search for how to improve things and reduce constant search for how to improve things and reduce errors vs. who’s responsible for the error. errors vs. who’s responsible for the error.

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LEAN CONCEPTSLEAN CONCEPTS

Build on client skills to get faster results Build on client skills to get faster results ––more output from the same peoplemore output from the same peopleFocus on continuously improving processes Focus on continuously improving processes –– both Internal & Externalboth Internal & ExternalIncrease speed by eliminating waste and Increase speed by eliminating waste and reducing errors reducing errors –– 50%+ improvements are 50%+ improvements are commoncommonIs constraint freeIs constraint freeWe are targeting the frequency (more) of We are targeting the frequency (more) of doing things, not the persondoing things, not the person

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The Classic WastesThe Classic WastesHandling/Unnecessary MotionHandling/Unnecessary Motion

Inferior MethodsInferior Methods

InspectingInspecting

Transporting/MovingTransporting/Moving

CountingCounting

Delaying/WaitingDelaying/Waiting

StoringStoring

All Rework LoopsAll Rework Loops

Multiple SignaturesMultiple Signatures

Waste of Underutilized PeopleWaste of Underutilized People

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Why is Money Saved?Why is Money Saved?Target best $$ opportunitiesTarget best $$ opportunities

Less transaction times = more Less transaction times = more transactionstransactions

Reduced cycle times = faster throughput, Reduced cycle times = faster throughput, info, decision making, etc.info, decision making, etc.

Less errors = less rework and checking, Less errors = less rework and checking, accurate informationaccurate information

Easier processes = greater employee Easier processes = greater employee satisfactionsatisfaction

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“Just the facts, M’am. Just the facts.”“Just the facts, M’am. Just the facts.”

The Foundation for Improvement is Built on Facts/Data

Sgt. Joe Friday

“In God We Trust”everybody else,

please bring data.

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AAchieving chieving CChange hange EEffectivenessffectivenessTo Successfully Implement and Sustain LEANTo Successfully Implement and Sustain LEAN

LEA

DER

SHIP THE VISION:

THE DESIRED OUTCOME OF CHANGE IS CLEAR, LEGITIMATE, WIDELYUNDERSTOOD AND SHARED. THE 90-SECOND SPEECH.

PROOF OF THE NEED:THE REASON TO CHANGE, WHETHER DRIVEN BY THREAT OROPPORTUNITY, IS INSTILLED WITHIN THE ORGANIZATION AND WIDELYSHARED THROUGH DATA, DEMONSTRATION OR DEMAND. THE NEEDFOR CHANGE MUST EXCEED ITS RESISTANCE.

DEVELOPING COMMITMENT:THERE IS A STRONG COMMITMENT FROM KEY CONSTITUENTS TOINVEST IN THE CHANGE, MAKE IT WORK, AND DEMAND AND RECEIVEMANAGEMENT ATTENTION.

SUSTAINING CHANGE:ONCE CHANGE IS STARTED, IT ENDURES, FLOURISHES AND LEARNINGSARE TRANSFERRED THROUGHOUT THE ORGANIZATION . W E MUST BEABLE TO SUSTAIN THIS LONG TERM.

MONITORING PROGRESS:PROGRESS IS REAL; BENCHMARKS SET AND REALIZED ; INDICATORSESTABLISHED TO GUARANTEE ACCOUNTABILITY . PROCESS OWNERS ,PERFORMANCE REVIEWS , ETC.

INFR

AST

RU

CTU

RE

The Elements of ACEHaving a champion who sponsors the change

CHANGING SYSTEMS AND STRUCTURES:Making sure that the management practices are used to

complement and reinforce change

Culture = “the way we

do things around here”

Actions,Behaviors, Systems &

Structures driveCulture

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When something is new or a significant When something is new or a significant change use ACE Tools:change use ACE Tools:

If something is new or a change, question #1 is: Should there be an elevator speech?- what is the change?- why are we doing it?- what do you expect from me?- what's in it for me (WIIFM)?

This provides the unified "talking points" for consistency of message.

Question #2 is: Who are the stakeholders, where do they stand,and where do we need them to be?

- stakeholder analysis sheet- strategies to address key stakeholders - communications strategy, etc.

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Stakeholder AnalysisStakeholder AnalysisGetting BuyGetting Buy--In from the Key Stakeholders in the ProcessIn from the Key Stakeholders in the Process

ACE ACE –– Achieving Change EffectivenessAchieving Change Effectiveness

StakeholderStronglyAgainst

-2

ModeratelyAgainst

-1

Neutral

0

ModeratelySupportive

+1

StronglySupportive

+2Type of Resistance Plan to Address

Key: X = Current Support LevelO = Level Stakeholder Needs to be

STAKEHOLDER ANALYSIS

1

2

3

4

5

6

7

8

X O

XO

XO

XO

X

X

X

X

O

O

O

O

Communication throughout process; educate/train

Involve in solution; educate/train; clarify roles & responsibilities - accountabilities; give credit for the change

Involve in solution; educate/train; clarify roles & responsibilities - accountabilities; give credit for the change

Involve in solution; give credit for the change

Involve in any technology solutions

Skepticism; preconceived solutions

Skepticism; change

Skepticism; change

Skepticism; change

Potential resource impact

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Cycle Time

Cycle Time

SalesSales SigmaSigma

COPQCOPQ

Accuracy Defects

Accuracy Defects

Cycle Time

Cycle Time

SalesSales SigmaSigma

COPQCOPQ

Accuracy Defects

Accuracy Defects

Cycle Time

Cycle Time

SalesSales SigmaSigma

COPQCOPQ

Accuracy Defects

Accuracy Defects

Cycle Time

Cycle Time

SalesSales SigmaSigma

COPQCOPQAccuracy Defects

Accuracy Defects

“Measure What Matters” (MWM)

Level 0Total Business

Level 1Core Processes

Level 2Sub-processes

•Focus on what are the key metrics to support our desired outcomes•MWM creates a results based organization•Metrics identify improvement opportunities•Metrics drive higher accountability

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Some LEAN Government Metrics: Some LEAN Government Metrics:

Output based: Output based:

BacklogBacklog

Work in ProcessWork in Process

InventoryInventory

Cost Based:Cost Based:

Cost per TransactionCost per Transaction

Total Process CostTotal Process Cost

Labor SavingsLabor Savings

Quality Based:Quality Based:

Customer SatisfactionCustomer Satisfaction

Rework Steps/TimeRework Steps/Time

First Pass Yield First Pass Yield -- Done Right the Done Right the First TimeFirst Time

% Complete & Accurate% Complete & Accurate

Organization Based:Organization Based:

Employee SatisfactionEmployee Satisfaction

TurnoverTurnover

Lean Events ConductedLean Events Conducted

Lean Event ParticipationLean Event Participation

Lean TrainingLean Training

Process Based:Process Based:

# of Process Steps# of Process Steps

# of Decisions Required# of Decisions Required

# of Signatures Required# of Signatures Required

# of Delays# of Delays

# of Handoffs# of Handoffs

Time Based:Time Based:

Lead Time Lead Time -- To Accomplish the To Accomplish the JobJob

% On Time Delivery% On Time Delivery

Total Processing TimeTotal Processing Time

Value Added TimeValue Added Time

NonNon--Value Added TimeValue Added Time

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PP--DD--CC--A LEAN Thinking ProcessA LEAN Thinking ProcessSelect the Targeted Process:

Value Stream Mapping

Plan – What needs to be done.

Do – “Trystorming”Check – Reflect on Results

Act - Adjust

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KAIZENKAIZEN

KaiKai ZenZen

To break apartTo break apart ThinkThink

To modifyTo modify Make goodMake good

To changeTo change Make betterMake better

KaizenKaizen

Change for the betterChange for the better

ImprovementImprovement

Continuous ImprovementContinuous Improvement

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Principles for Kaizen ImprovementsPrinciples for Kaizen Improvements

1.1. Think about how the new ideas will work, not Think about how the new ideas will work, not how they won’t work.how they won’t work.

2.2. Don’t seek perfection Don’t seek perfection –– 80% right, 100% 80% right, 100% implemented.implemented.

3.3. Fix mistakes the moment they are found.Fix mistakes the moment they are found.

4.4. Make improvements with minimal Make improvements with minimal investment.investment.

5.5. Continue to ask “Why?”.Continue to ask “Why?”.

6.6. Don’t except excuses.Don’t except excuses.

7.7. “Just do it” “Just do it” –– make it happen.make it happen.

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Why is our approach different?Why is our approach different?

1.1. We are driven by data and facts from what the We are driven by data and facts from what the process tells us. We like to use “visual process tells us. We like to use “visual techniques” as much as possibletechniques” as much as possible

2.2. We integrate Achieving Change Effectiveness We integrate Achieving Change Effectiveness (ACE) and Business Process Management (ACE) and Business Process Management (BPM (BPM –– Measure What Matters)Measure What Matters)

3.3. We get the job done fasterWe get the job done faster4.4. We transfer sustainable skills to the Client We transfer sustainable skills to the Client

organization much fasterorganization much faster5.5. We offer a comprehensive service We offer a comprehensive service –– not just not just

one “niche”one “niche”

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Why is our approach different?Why is our approach different?

6.6. We have trained groups in LEAN globally We have trained groups in LEAN globally ––US, Europe, Japan, and ChinaUS, Europe, Japan, and China

7.7. We have “handsWe have “hands--on” developed, implemented on” developed, implemented and managed comprehensive LEAN and managed comprehensive LEAN initiativesinitiatives

8.8. We have benchmarked best practicesWe have benchmarked best practices9.9. We integrate LEAN, Six Sigma, and We integrate LEAN, Six Sigma, and

Specialized Techniques (Bhote), as Specialized Techniques (Bhote), as appropriate appropriate –– a unique tool seta unique tool set

10.10. We don’t use as many of the traditional We don’t use as many of the traditional “Quality Tools” “Quality Tools” –– brainstorming, fishbones, brainstorming, fishbones, NGT, SPC, etc. as often as othersNGT, SPC, etc. as often as others

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Our LEAN Rollout PlanOur LEAN Rollout Plan

1.1. Preliminary Meeting to review scope of work Preliminary Meeting to review scope of work ––no chargeno charge

2.2. One day Overview/Launch Session One day Overview/Launch Session

3.3. Three day Leadership Team Session Three day Leadership Team Session –– 1 day for 1 day for ACE and 2 days for LEANACE and 2 days for LEAN

4.4. Five day Kaizen Events for each identified Five day Kaizen Events for each identified ProjectProject

5.5. OnOn--going Project Management Supportgoing Project Management Support

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Project ResultsProject Results

Collected $750K+ and Collected $750K+ and streamlined the processstreamlined the process

Collect $250K+ in back Collect $250K+ in back revenuesrevenues

Police Private JobsPolice Private Jobs

Reduced from 89Reduced from 89-->48 >48 days days –– impact $600K+ impact $600K+ --eliminated penalties, able eliminated penalties, able to have time for more to have time for more negotiations, etc.negotiations, etc.

Total process reduce from Total process reduce from 8989-->70days>70days

Purchasing RequisitionsPurchasing Requisitions

Reduced by $450K+/QtrReduced by $450K+/QtrReduce by $250K/Qtr.Reduce by $250K/Qtr.Police OvertimePolice Overtime

$4M+ of Grant monies $4M+ of Grant monies “found” and able to be “found” and able to be usedused

Centralize and manage Centralize and manage better better –– Generate $1M+ in Generate $1M+ in useful spenduseful spend

Grants administrationGrants administration

97% within 24 hours of 97% within 24 hours of reportingreporting

95% within 2 days of 95% within 2 days of reportingreporting

Pothole repairs Pothole repairs -- DPWDPW

3030--> 1 day, cash in bank > 1 day, cash in bank making $250K+/yearmaking $250K+/year

3030-->3 days non lockbox >3 days non lockbox checkschecks

Tax Collection Tax Collection –– time to time to put cash in the bankput cash in the bank

ResultsResultsImprovement GoalImprovement GoalKaizen or ProjectKaizen or Project

Page 22: Continuous Improvement in Government: Applying LEAN Principles Lean.pdf · 2016-03-20 · Implementing & Sustaining Government LEAN Initiatives 3 Q6σ 3 Lean PIC, LLC About QPIC &

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What Do Clients Receive? What Do Clients Receive? What Do Clients Receive?

Knowledge…

• Transfer LEAN Six Sigma DNA into the organization

• Deliver right tools and techniques to solve business problems

• Train with simple, easy to understand intellectual material

Self-sustenance…

• Build and leave proven deployment strategy in place

Culture of excellence…

• Shape a data-driven employee base…every discussion,

meeting, decision

• Produce a process-focus mentality…everything is a process

• Institute a common language…

Results…Results…Results

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www.www.leangovcenterleangovcenter.com.com

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Contact InformationContact Information

QPIC (Quality and Productivity Improvement Center), LLCQPIC (Quality and Productivity Improvement Center), LLC21 Apache Lane21 Apache Lane

Marlborough, CT 06447Marlborough, CT 06447860860--295295--91349134

www.leangovcenter.comwww.leangovcenter.comqpicllc@[email protected]

Daniel Penn Associates, LLCDaniel Penn Associates, LLC47 Foxridge Road47 Foxridge Road

West Hartford, CT 06107West Hartford, CT 06107860860--232232--85778577

[email protected]@danielpenn.com