Presented to

Presented by

Delta LTMS Regulatory Technical Work Group

Dr. Joshua Burnam and Mr. Steve Cappellino

Value Stream Analysis: Ideas and Options

April 24, 2007

Overview of Presentation

• What VSA is and is not

• How we prepare for it

• Logistics

• What it looks like – options

• Cost

What VSA is By-the-Book…

• Lean Six Sigma is a statistical concept that measures a process in terms of defects, with the goal of reducing variability, decreasing defects and increasing efficiency using rigorous quantitative methods.

• Value Stream Mapping and Analysis (VSA) is one application of the Lean method designed to reduce waste and inefficiency for both the process owner and customer by “mapping” a process flow and looking for areas that can be improved.

Specific Goals of our VSA

• VSA in our potential application would be applied to the agency “web” for project approvals, and would look for ways to unify/improve the application process; reduce inefficiencies such as feedback loops and do-overs; and improve public perception.

– We would essentially walk the “web” as an applicant.

• The unified process map would be a starting point for an ad-hoc, or formal, DMMO; a consolidated permit application; or other process improvements for agencies.

• It will help applicants know what the order of operations is; what the information they need is the first time through; what works and what does not.

• Initial success would be defined by:– A process map– Agency recognition of their role in the larger web– Applicant recognition of their role in the process

Key Tenets of VSA

• Reduce/eliminate time, waste, inefficiency

• Include both “owners” and “customers”

• Twelve total steps between defining the boundaries and assumptions; the current state; and the idealized future state.

Define the VSA BoundariesDefine the VSA Boundaries

Suppliers:Permit Applicants

Applicant Agents

Interested Members of the Public

Resource Agencies

HQACE

Local Gov’t.

Inputs Outputs

Trigger:J.D. Request or Application

Received

Customer:Permit Applicants

Major Elements of the Regulatory Process:• Public Notice• Endangered Species• Review of Completeness• Section 106• Jurisdictional determination• Scope of Analysis• Alternatives Analysis• 404(b)(1) Guidelines • NEPA Analysis• Public Interest Determination• Develop the Package• 401 Certification• CZMA• Consultation with Indian Tribes• Public Hearings

What:Application

Project InformationOpinions

Private DesignApplicability of Rqmts

What:Permit Decision

Done:Permit Decision Issued

Process

3. Value Statement…Total Value Stream Examined in This VSA

1. Business Case…Why are We Here?? How will this Benefit us??

2. Key Requirements (Musts)…Requirements That Can’t Be Changed

4. Key Measurements…2 to 3 Metrics which we will measure future success by

Existing Statutory and Regulatory Requirements

Define the OutcomeDefine the Outcome

Efficient entry into the process by applicants, and timely permit decisions that comply with State and Federal laws and regulations and, if a permit is issued, enables the

applicant to proceed with a practicable project.

1. Turn-a-round Time – i.e. elapsed time from date a complete application is received by all agencies to issuance of final permits. Goal is 120 days.

2. First Pass Yield of Applicant Submittals – Percent complete and accurate the first time. Goal is to increase FPY to <90%

Efficiency must be increased to maintain the quality of permit decisions and improve public perception.

What are our Main Issues?

• Examples:– Flat budgets– Increasing workload– Increased mandates – Perception/reputation of Agencies– Applicant knowledge/savvy– Confusing application order-of-operations

What VSA is not…

• Cheap (depending on what we pick)

• Easy (it is time consuming and has “homework”)

• A silver bullet – it will give us maps of where are and where we can get, but we must then implement the process improvements

Who Should Attend / Participate

• Not a delegated activity• Minimum requirement is “value stream” Leadership Team

– KEY LEADERS – PM, PROCESS OWNER(s)– MANAGERS/SUPERVISORS of the PROCESS– SME’s– KEY STAKEHOLDERS– CUSTOMERS of the VALUE STREAM– SUPPLIERS to the VAULE STREAM

• Limit attendance to no more than 20 people• Schedules are cleared for full-time participation (3.5 days)• Hang time - not an 8 to 5 activity - plan on long days

Data Collection• In our case – a Case Study• Performance metrics

– CURRENT YEAR-TO-DATE– PREVIOUS FISCAL YEAR

• Demand (historical and projected)– BY END-ITEM DELIVERABLE– $’s AND #’s

• Voice of the customer– Key issues– Key Opportunities

• Current organization chart• Facility block layout

Logistics• centrally located team room with lot’s of wall space• LDC projector• DVD player and TV• 2 paper flip charts on sturdy stands• colored markers (both wide tip and fine point)• roll of butcher paper• roll of masking tape• roll of scotch tape• post-it notes (various sizes and colors)• sticky dots (“nickel sized” red and green in color) • name tags (sticky paper-type are fine)• drinks and snacks

Value Stream Analysis – 4 Day Professional Facilitation

1: DEFINE THE BOUNDARIES2: DEFINE THE VALUE.3: SET UP THE MAP .

4: OBSERVE AND GATHER DATA5: MAP THE FLOW OF ITEMS6: MAP THE FLOW OF INFORMATION7: ADD DATA BOXES AND HIGHLIGHTS

8: GO BACK TO THE GARAGE

9: CHOOSE NATURAL GROUP S10: DEVELOP IDEAL STATE MAP

11: DEVELOP FUTURE STATE (6-12 MO. MAP )12: DEVELOP ACTION P LANS AND TRACKING

prepare

currentconditions

breakthroughs

vision

plans

“Beginning your Lean Transformation”

• Define (2-3) measures you want to impact by 10-50% in the next 12 months through the application of VSA

– WHAT? HOW MUCH? BY WHEN?

– GO NOWHERE, START NOTHING UNTIL EXPECTATIONS ARE CLEARLY DEFINED

– MAKE SURE YOU AGREE WHAT YOU WANT FROM LEAN AND HOW TO MEASURE IT

Step 1: Define “what” you want from Lean

Day One08:00 – 08:30 Process Owner Kick-off & Introductions08:30 – 11:00 Value Stream Analysis Briefing11:00 – 12:00 Define the Boundaries Step 112:00 – 13:00 Lunch13:00 – 15:00 Set Up the Map - Steps 2-315:00 – 1700 Walk the Process - Observe and Gather Data Step 4Day Two08:00 – 08:30 Review Day 1 and Plan for Day 208:30 – 10:00 Continue to Observe and Gather Data - Step 410:00 – 12:00 Build the Current State Map – Steps 5-713:00 – 14:00 Go Back to the Garage – Step 814:00 – 15:00 Choose Natural Groups – Step 915:00 – 1700 Develop Ideal State Map – Step 10

TYPICAL 4 DAY AGENDAValue Stream Analysis

TYPICAL 4 DAY AGENDA Value Stream Analysis

Day Three08:00 - 08:30 Review Day 2 and Plan for Day 308:30 - 12:00 Develop Future State Map – Step 1112:00 - 13:00 Lunch13:00 - 17:00 Develop Action Plan and Tracking - Step 12

Day Four08:00 - 10:30 Prepare Outbrief10:30 - 11:30 Outbrief11:30 - 12:30 Lunch12:30 - 15:30 Prep for First Rapid Improvement Event

Value Stream Analysis Charter

Value Stream Output and Description: (What is the value provided to the customers of this Value stream? Provide a comprehensive list of deliverables)

Current State Process Information: (General description of the how the process current performs – metrics are valuable so include where possible)

Process Owner:

Team Leader:

Co-Leader:

Sensei: Customer Requirements (TAKT Time): (Demand on this value stream, i.e., the number of items requested by the customer.)

Preliminary Objectives: (What are the key objectives for improving the Quality, Delivery/Responsiveness, Cost/Productivity of the value stream. Objectives should be SMART = specific, measurable, achievable, realistic, tangible)

Current Situation and Issues: Why are you conducting this VSA event? What is your “burning platform”)

Event Dates:

Team Members:

List top 5 issues.

- Brief on upcoming VSM Event (non team members that may get involved)

- Secure ad hoc support based on proposed event schedule

8: Secure Conference Room(s) For Event

- Ideally room should be located near work area

- Room must be available for entire duration of event

9: Obtain all necessary supplies for event

- Post it Notes, small square multi color 2 /78x2-7/8 and 3-7/8 5 7/8

- Flip Charts , Markers, tape , scissors

- LCD PROJECTOR

- Butcher Paper (rolls)

- Access to laptop to document event - Etc.

14: Brief facilitator/consultant on event

- Review checklist status

- For external consultants review program, key events and individuals

- Provide read ahead material to external consultants on business

& program

Date: Prepared By:

4: Hold final prep meeting with Team lead & co-leaders,

resolve any open issues or concerns

5: Arrange for working lunches for team

6: Review event status with facilitator/consultant.

- who are the customers?

- what are the outputs?

- what triggers the area to do something for a customer?

- who are the suppliers? what are the inputs?

2: Revisit Items 8 & 9 from 3 weeks before has anything

changed?

3: Define clearly the boundaries of the Event:

13: Review packages from any previous events in this area.

Pay special attention to time observations, layouts

(spaghetti diagrams), accomplishments lists, lessons learned.

Event Name:

Value Stream

Value Stream Mapping (VSA) Event Checklist

2nd Week Before Event: 1st Week Before Event:

1: Review "3 weeks before" and "2 weeks before"

checklists. Resolve open items.

- what is the business case for analyzing this Value Stream?

9: Review deliverables, measurements and targets with

the external or internal consultant. Revise if needed.

10: Ask a few hard questions (then revisit 1, 2 and 3):

8: Select 2 -3 measurements and targets for the team

that will help define success for the team.

- Will this team improve your Process/Functional performance?

- Are you focusing your scarce resources on the right priorities?

7: Define the deliverables expected from the

Event team (eg. Quality Improvement, Reduced

Flow Time, Reduced Cost etc.)

6. Identify Event Facilitator(s)/Consultant(s)

- Obtain External Consultant Seport As Req'd

3. Prioritize Value Streams within Area

4: Define team leader, co-leader and the team members.

5: Would like site leadership and key site personnel involved

- Team size of 15 - 20 are recommended per Value stream

3rd Week Before Event:

3: Determine current customer steady state demand

4: Determine actual output (if not available use most current

5: Determine top 5-10 categories of problems noted from the

1: Review "3 weeks before" list, resolve open items1: Select area and topic. (Complete VSA Charter Form)

2: Meet with Process leaders(PL) or /Functional Leaders(FL) to:

- Prioritize Value Streams within Area

- Secure Full Time Participation of Team Members

- Obtain PL/FL Commitment to Event Follow-up

information collected (eg. Shortages,schedule misses...).

2: Gather data/identify sources on current state

- Identify sources of data on current process (Financial Reports,

Flow Charts, Command Media etc)

- Run reports on actuals etc.

predicted or budgeted figures)

6: Review actual customer issues, audit results, etc.

7: Determine key individuals needed to support on ad hoc basis:

10: Issue written invitiation to team members. Include

measurements, targets and deliverables.

event particulars, time expectations and deliverables.

11: Review and confirm Event team leader, co-leader

and members.

- Make sure team members are committed for the whole event!!!

12: Brief team co-leaders and members: Event schedule,

Current State MapCurrent State Map

Y

No/Maybe

A ApplicationComplete

Letter or Phone Call to Applicant

I

I

Recv. Add. Info

Public NoticeDrafted

Public Notice Issued

I I

Corp Review Comment Ltr

Ltr to Appl.

I I

Water Quality Certif

Endangered Species

Cultural/Tribal

EssentialFish Habitat

I

I

I

I

I

Assess ESA info.

Review Response

IncompleteI

Decision Document

I

Services ReviewEffect?

I

Contact Applicant

Complete?

II

Consultation and Draft BD

Appl and Corp Review draft

BO

Service Completes BO

I

Indvidual Permit Process

Coord w/ Arch/Corps,

Cultural Resources

Complete?

N

Sec 106 Determ

I

Effect? GenerateLtrs

IY Maybe

SHPO Rev Sec 106

Complete?

INN

SHPO DraftsMOA

Corps forwards

MOA to Tribes

Corps forwards

MOA to SHPO

SHPO signs MOA

MOA Complete

Coastal Zone Mgt.

N

Y

B

External Organization

Ledgend

B

I

Draft Decision Doc and

Permit Ltr. I

Sec ChiefReview

80%

Branch Chief/Distr Eng.

Review

Put in Final Form

Permit Decision Issued

Applicants

I I

Indvidual Permit Process

Applicant Sign

Corps Sign

Value Statement

Timely issuance of a permit decision that

comply with Federal laws and regulations and, if a permit is issued, enables the applicant to proceed with a practicable project

Key Requirements

Domestic Statutory and Regulatory Requirements

Measurements

· Turn-a-round Time – i.e. elapsed time from date application is

received to permit issued Goal is 100% within 120 days

· Total Application Backlog - i.e. number of applications in process

and/or waiting to be processed at any given time. Goal is to reduce by 50%

· First Pass Yield of Applicant Submittals – Percent Complete and

accurate the first time. Goal is to increase FPY to <90%

Ideal State

· On-Demand· Defect Free· 1-By-1· Lowest Cost

Applicant

Sec Chief assigns to PM

PM Review for completeness

Complete? Yes

No

Csll/Email Applicant

for more info.

Receive Additional

Applicant Info

25%

75%

Site Visit Office Visit

Field Visit

Develop Disclaimer Letter

Verify Delineatio

n

Sec Chief Review

Office of Council Review

No permit or Jurisdiction Required

PM Issues Letter

Letter Developed

JDs

I

I

I

I

I

I

I

I

I

Set up Field Visit Verify

Letter Developed

More Info.

Field Visit

N

Y

I

PM SignsLetter

Applicant Appeals

I

1%I

Send Additional Info to District I

I

2nd

Applicant Appeal

Admin Records Prep

Division ReviewAppeal

Mtg.

Division Process Correct

YII

I

I

IICourt and/or

AppealI

Review Application

30%

A

Jurisdictional Determination

Business Case

In light of increasing workload and complexity

associated with the regulatory program, efficiency must be

increased to maintain the quality of permit decisions

Total Flow Time = 152 - 383 days Total Touch Time = 105 - 132 hours

Total Flow Time = 152 - 383 days Total Touch Time = 105 - 132 hours

Future StateFuture State Map Map

YY

Value Stream Map

Value Stream Path

Business Case

In light of increasing workload and complexity associated with the regulatory program, efficiency must be increased to maintain the quality of permit decisions

and improve public perception of the regulatory program

Value Statement

Timely issuance of a permit decision that comply with

Federal laws and regulations and, if a permit is issued,

enables the applicant to proceed with a practicable project.

Key Requirements

Domestic Statutory and Regulatory Requirements

Measurements

1. Turn-a-round Time – i.e. elapsed time from date application is received to permit issued Goal is 100% within 120 days2. Total Application Backlog - i.e. number of applications in process and/or waiting to be processed at any given time. Goal is to reduce by 50%3. First Pass Yield of Applicant Submittals – Percent Complete and accurate the first time. Goal is to increase FPY to <90%

Ideal State

· On-Demand· Defect Free· 1-By-1· Lowest Cost

Applicants

Electronic Information

Supermarket

Applicant Request

FIFO

PM reviews and approves for site visit

Public notice issued

15 day comment period

Start decision

document

Start ESA Sec 7

consultationComplete

N

Site Visit

Verify Deliniation

Avoidance/minimization

IIssue JD

verification ltr

Comments Received and

sent to Applicant

I

I

Applicant responds to comments

to PM

PM finalizes Decision Doc.

I

Permit decision issued by PM

Schedule site visit

One level of review for

lower grade PM’s

One Level of review for

lower grade PM’s

Write Public Notice and

JD ltr.

ESA Required?

N

90 Days

30 Days

Review draft BO

45 Days

Continue writing

Decision Doc. Applicant

for signaturePhone

Key Changes to Create Future State - Requirement on applicant is significantly greater- Applicant is to provide all required info up front- Application is “complete” after application info is verified by PM- Measure of throughput /turn-around time will include time from application received- Created one piece flow (uninterrupted concentration on task)- Reduced the amount of wait time- Placed permit decision and signature authority on PM- Included 15 day public notice versus 30 day standard- Reduced rework by improving the application submittal process - Corporate policy and regulation need to be re-visited- Process quality must be addressed- Abandon the “Current State” process- Command must support the new process including “turned back” applications (request for additional applicant info)-Must establish (mistake proof) guidelines for application submittals

Regulatory Lean Process Metrics

*Projected

Current State

Future State *

Flow Time (days) 152-383 77-156 minus 75 - 227 49 - 59Touch Time (hours) 105-132 80 minus 25-52 24 - 61# People 32 11 minus 21 66# Approvals 15 3 minus 12 80# Handoffs 30 7 minus 23 77Items in Inbox 174-686 10 minus 164-676 94% Yield of the IP Process 1.47 56.00 plus 54.53 97.4

Delta # % Improvement Regulatory

Metric

VSA Without Facilitator

• “VSA Lite” - 2 Day Process led by SPD Expert Dr. Aaron Allen without consultant

• First Day: 1. Introductions (30 minutes)

2. Brief Introduction to VSA (30 Minutes) 3. Define the Boundaries (2 Hours) 4. Walk the Process and Build Current State Map (4-6 hours)

• Second Day 1. Complete Current State/Review Current State (30 minutes)

2. Develop Ideal State Map (1 hour) 3. Requirements for the Future State (1 hour) 4. Develop Future State (4 hours)

Differences from 4-Day

• “Homework” still required

• No computerized maps of the process (just hand-drawn)

• No computerized metrics

• Less time

• Less cost

Costs

• 4-Day Facilitated VSA was $31,500 including time and materials for the consultants (Anteon/Simpler)

• 2-Day VSA lite may be free

• Homework:– Prepare our case study, charter, and goals– Get room for 2-4 days– Deal with logistics of paying the consultant

Questions/Comments?