Lean Six Sigma for Good

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Book Review: “We Don’t Make Widgets” and Other Myths about Improving Government

10 min read

by Brion Hurley

One of the more popular books related to process improvement in government is “We Don’t Make Widgets: Overcoming the Myths That Keep Government from Radically Improving” by Ken Miller.

Ken Miller, who also wrote Extreme Government Makeover, is the founder of the Change and Innovation Agency, a firm dedicated to increasing government’s capacity to do more good. Previously, he was the Deputy Director of the Missouri Department of Revenue, where he was part of a transformation effort that reduced the time to issue tax refunds by 80% (fastest in the nation) at less cost, and cut wait times in motor vehicle offices by half.

I saw him present at the first Lean Government Exchange in June 2017, hosted by the Iowa Lean Consortium in Des Moines, Iowa. But it took me almost 3 years to get around to reading his book. With the COVID-19 pandemic going on, I suddenly had time to finish it.

If you want a quick summary, I highly recommend reading this book if you work with or within government, or your work is service-based (non-manufacturing). Even though it was written back in 2006, it is very relevant today. There are probably more government agencies applying improvement methods like Lean since the book came out, so I think his work has been paying off. But the majority still are not, so there is plenty of need out there. You can order the book on Amazon here.


Miller asks the question, why doesn’t process improvement work the same in government as it does in the business world?

Here are some of the common myths and excuses he has heard over the years:

  • We don’t make widgets
  • We don’t have customers
  • We’re not here to make a profit
  • Our survival doesn’t depend on customer satisfaction
  • We get penalized for being efficient
  • It’s easy when you have a factory; we’re in the service business
  • People don’t want what we produce; we make them have it
  • The people who pay for our services are not those who use it
  • But we have elected officials
  • There is no incentive for us to improve

To contradict these ideas, he uses a simple comparison between an automaker and a government agency.

OrganizationFactoryWidgetCustomersOutcomes
FordFord FactoryFord MustangDrivers– Profit for Ford
– Looks good
– Feel young
– Transportation
State Human
Services Agency
Investigation
of child abuse
Child abuse
investigation report
Prosecutors– Safe kids
– Strong families
– Successful prosecution

He gives a few examples of these in other agencies and departments. Once employees and staff can see the connection to traditional companies, they will start to embrace improvement methods from those industries.

I like his definition of government:

“Government is a bunch of hardworking people, trapped in dysfunctional systems, who produce invisible things for people who do not want them, on behalf of others who do want these things for reasons we rarely articulate and can hardly measure.”

He does a great job comparing government to private businesses to explain why they are more similar than different.

BusinessGovernment
InvestorsTaxpayers
Board of DirectorsGovernment board or legislature
CEOCounty manager or state governor
Business unitDepartment or division
Products or servicesProducts or services
How government and business have similar management roles

Currently, government ineffectively tries to improve using the following approaches:

  • Blue-Ribbon Commission
  • The Politburo
  • Reorganization
  • Focus on Individuals
  • Technology

He explains each of the methods, and why they tend to fail.

What are widgets?

One question I had that he addresses is the use of the term “widget.” He feels that services is too broad and hard to define for most people. All services should have a tangible or deliverable outcome (widget), such as a document, or report or decision or recommendation. Therefore, its easier when there is focus around that widget.

In fact, most people work in the service industry (over 85% and increasing every year), so most of us have difficulty figuring out what we do, and turning it into a widget, not just those in government.

Who is your customer?

Defining the widgets and the customers are some of the biggest barriers to making improvements. For example, who is the customer for a license plate?

It’s not the drivers, it’s law enforcement (police) who are trying to determine if people are paying their vehicle taxes. Many states have made changes to the look of the license plates to brand their state, but they made it more difficult for police to find expired plates, and thus reduced tax revenue to the departments by 50% in the State of Missouri. I’ve also seen plates where the contrast in colors makes it difficult to read the plates, thus hard to look up the numbers, especially as cars are driving past quickly.

Hard to read license plate number (8 or B or even overlooked)

Defining Metrics For Your Widget

Once widgets are defined for the process, then the team needs to determine if the right metrics are in place, and if they are working on the right problems. Again, these questions are great for any process, not just government processes.

  • How many of these widgets are we able to produce?
  • How many of these widgets do we need to produce?
  • How long does it take to make the widget?
  • How much does it cost to make the widget?
  • What percentage of the widgets makes it through the factory correctly on the first try?
  • How much does it cost us and our customers when there are mistakes?
  • What do customers want from this widget?
  • Are the customers getting what they want?
  • What results are we hoping to achieve with this widget?
  • Are we achieving those results?

Miller feels confident he can reduce the time to produce widgets by 90-95% because of how processes have evolved. The culture of “cover your ass” (CYA) leads to multiple inspection and documentation steps that slow down the process, all with the intent of assigning blame to the correct team, department or individual when something goes wrong.

Measuring Process Speed

Here are two primary metrics needed to measure the customer experience:

  • Work time – time during a process when actual work is happening
  • Elapsed time – the total time the process takes from the customer’s perspective (work time plus any time spent on hand offs, waiting, batches, backlogs, rework and delays)

As an example, if a process takes 30 days, likely only one hour of that duration was work actually being performed on the widget. Therefore, only a fraction of the 720 hours of waiting time was valuable. There is a lot of opportunity to reduce elapsed time for the customer by streamlining the process and removing waste. This is the exact approach for applying the fundamentals of lean.

When you look at these two time metrics for your process, you’ll find a lot of opportunity as well.

Variation Management

Lack of understanding around variation is another issue with past initiatives, that measurements will vary up and down, and not to overreact to those fluctuations. Managers need to understand the concept of common cause variation, and only investigate when special cause variation is present.

How to Improve Government Processes

He also provides some simple steps for improving that are applicable for any process:

  • Talk with customers to determine their expectations for the widget (more details provided in the book)
  • Design the widget to meet customer’ expectations
  • Create a flowchart for the existing process that produces the widget
  • Calculate the two units of time: elapsed time and work time
  • Close the gap between elapsed time and work time by at least 80 percent by eliminating hand offs, cutting batches and batch sizes, eliminating bottlenecks, processing in parallel, and reducing inspections.
  • Identify ways to reduce the work time
  • Use problem solving to reduce errors and variance in the process
  • Involve employees in the improvement process

Say No to Customer Surveys

Miller is also not a big fan of customer satisfaction surveys. He feels they are not measuring what the customer actually wants, rather how you delivered what you gave them as compared to their low expectations. Often times, the surveys are sent to the wrong “customers” who aren’t the actual users of the widget. For example, most residents don’t know who the labor department is, unless they have applied for unemployment.

In addition, surveys are usually reactive. The customer has already left, and nothing can be done about the problem. The information takes a while to even get to the right people (if ever at all), and the time delay makes it hard to troubleshoot what happened, and thus difficult to fix and prevent the problem in the future.

Too often, government is focused on the funders (their parent organizations), and not enough on the recipients or customers of the widget. For example, instead of focusing on food stamp recipients to make the process easier for them, the organizations are focused more on what their state and United States Department of Agriculture (USDA) want and need.

Overemphasis on Customer Service

He also talks about customer service, which is the touch points when employees directly interact with the customer. That is only a small percentage of the overall customer satisfaction. Having a nice experience and interaction between employee and customer (resident) is obviously important, but customer satisfaction looks at a much broader view, and that is often left out of the improvement opportunities.

For example, at the Department of Motor Vehicles (DMV), here are some additional questions one should ask to make customers happy:

  • Why do customers have to wait so long in line?
  • Why do customers have to bring in all this information?
  • Why do customers have to come in at all?
  • Why can’t customers do this from home?

In fact, when you fix the entire process to make life easier for the customer, it makes it easier to provide excellent customer service.

I really liked this quote

“It’s amazing how friendly the staff can be when the customers aren’t yelling at them.”

Miller provides 5 things that most customers care about, and I’ll include a permitting example of each one. Again, these are great for any process…

  1. Ease of use – how easy is it to use the product, service or widget
    • Permitting Example: How many minutes does it take customers to complete the permit form?
  2. Timeliness – how long does it take when the customer wants something until they get it.
    • In HR, this is the time when the employee is planning to leave until the new employee is hired.
    • For permitting, the clock starts when they identify the need for the permit, which is often much earlier than when they actually submit the paperwork
    • Permitting Example: How many days does it take to receive a permit (from initial need to approval to proceed)?
  3. Accuracy – how good is the quality of the widget?
    • Permitting Example: What percentage of payments are correct the first time?
  4. Cost – the cost to create the widget, which needs to include the lifecycle costs, not just the payment or purchase price.
    • Permitting Example: how many days of lost productivity and labor costs do they incur while applying for the permit, on top of the permit fees? He mentions that often customers would be willing to pay more for government services if it could reduce the wait time, as their overall costs and project delays cost far more than the fees.
  5. Choice – How many options and customization are available to customers?
    • Permitting Example: What percentage of customers are using internet transactions?

But ultimately, customers want results. They don’t buy a car, they buy transportation to get one place to another conveniently. That is what all processes should be focused on.

What value does your organization provide?

When organizations don’t have a clear vision of what they do, and show the value they provide, then they tend to get scrutinized on every purchase and budget they submit. Instead of reporting the impact they have on the community, they report easy metrics to collect.

For example, building permitting often reports metrics like how many permits given out, how many staff were involved, how many buildings, or how many hours of processing were applied to the permits. But a better metric might be how many affordable housing units are now available, which might be the larger goal for having certain permits.

He also walks through a 5 why’s exercise (in reverse order), to help organizations find their true purpose. He gives a couple examples in the book.

What Name Do You Give to Improvement?

He suggests not putting a name to the improvement initiative (like Lean or Six Sigma or Process Excellence), otherwise it might appear to be something different than the core operations, and thus another thing on their to-do list that they don’t have time for. It should be integrated into the way employees are improving every day.

What about employee satisfaction?

Miller suggests not focusing on employee satisfaction directly, instead he suggests fixing the processes.

“By fundamentally improving the systems that satisfy customers and that deliver organizational outcomes, you invariably end up improving the lives of the employees.”

Where to Start With Improvement?

Here are some areas to look at first:

  • systems that are the largest consumers of the organization’s time and money
  • areas of customer dissatisfaction
  • processes with numerous errors and rework
  • systems that could benefit from going 80% faster
  • areas that will have a big impact on other systems
  • processes that will yield a high return on the project’s investment
  • systems that will show noticeable improvement within 12 months’ time

He suggests that you should put together a cross-functional team to work on the improvements, and ensure that you have a strong management sponsor and a trained change agent. Ideally, managers should become the change agents. They should know how to:

  • determine customer expectations
  • develop performance measures
  • analyze data
  • improve a process
  • solve a problem
  • manage a project
  • develop their people

Summary

Here are the three myths of government improvement:

1) We are here to achieve a profit, and that we need to be as focused on our results as the private sector is focused on profit.
2) We do have customers; they may not be who we thought they were, but our success does depend on their satisfaction.
3) We do make widgets; we do have factories; and it is possible to measure, manage, and improve what we do.

If you liked this review, read more about Ken Miller or check out “We Don’t Make Widgets” book on Amazon.

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