Kickstarting Process Improvement Initiatives in a
DoD Contracting Environment
The Lean Six Sigma (LSS) approach to Process Improvement
by
Kevin Lehigh
Lehigh Technical Solutions
30 October 2012
Page 1
Abstract
Mr. Lehigh has refined two techniques that can be used to kick start the correction of
process issues in short order. These methods have proven to be highly effective in
finding the right opportunities to work, in a variety of client environments such as DoD
agencies, DoD contractors and Healthcare organizations. The efficiency of application
and the focusing power of these methods deliver returns quickly.
The basic methods can be found in the literature under the headings of Strategic Multigeneration Project Plan (MGPP)1 and Kaizen Blast2,3. In this paper these methods are
compared to determine under which circumstances each method applies best. Two realworld examples of application of each method are provided.
Introduction
One example of each of the two methods is discussed in this paper.
Example 1 draws from my previous work with a DoD contractor that provides services
for military commands such as the Army’s TACOM and CECOM and various Navy
contract vehicles that use DoD contractors such as SPAWAR. The work that was done
with this particular government contractor was performed shortly after three different
companies were merged to form a larger DoD contractor.
Example 2 stems from work done at various J-codes and PLFAs (primary level field
activities) at the Defense Logistics Agency (DLA) headquartered near Fort Belvoir, VA
pursuant to creating better projects that align to either HQ or PLFA objectives.
Example 1:
DoD contractor XYZ had many ad hoc and ineffective accounting, HR, contracts, and
project execution processes and procedures left over from previous mergers and
acquisitions. It was difficult to get invoices paid to their suppliers, to receive payment
from customers, and to execute programs without customer complaints. A Kaizen Blast
approach was used to identify, prioritize and flush out festering systemic problems and
poor practices. The method we used to organize, prioritize and create projects to resolve
problems we call Kaizen Blast.
1
John McDonough, isixsigma.com Feb 2010 article, “Multigenerational Project Planning Fit with Six Sigma”
(http://www.isixsigma.com/implementation/project-selection-tracking/multi-generation-project-plannings-fit-six-sigma/_
2
From page 39 AMERICAN SHIPPER: AUGUST 2006 article entitled, “Follow the Leader—Automakers and their 3PLs similarly strive for lean,
JIT operations, but differing cultures prevent industry-wide efficiency” by Eric Johnson.
3
From “Applying Transactional Lean at Medical Imaging Firm” by Benjamin Hahlen and Susan Mahoney February 26, 2010
Page 2
To guarantee results there should be clear quantitative measures of success, the
importance of the project to the organization should be clear, and the project should have
the full support and approval of executive management. These three characteristics are
needed so that the organization’s leadership sees the importance of the project, provides
the needed support and resources, and removes barriers to the success of the project.
People are more likely to support a project that they can see is clearly important to the
organization.
Project ideas can come from any source such as process assessments, customer and
employee surveys and suggestions, benchmarking studies, extensions of existing projects,
and so on. Significant productivity improvements result from high impact projects that
feature one or more of the following:





Reduce Effort to do the same amount of work
Reduce Complexity of the work being done
Minimize Rework
Identify Products with major backlogs—need for more capacity
Improve Quality of volume products (small improvements can have huge impact)
If all projects would positively affect at least one of these areas, you will have significant
tangible results when they are completed. In the case of service or transactional
processes, the key process metrics will typically be accuracy or cycle time control
measures. Accuracy includes control of defects in information such as account numbers
or financial figures, and directly relates to both customer satisfaction and rework costs.
Reduction of cycle time in business processes is a productivity measure, so it also relates
directly to costs and, of course, to customer satisfaction (e.g., time to complete and
deliver reports).
Our method starts with the one-on-one interview as a means to capture preliminary
issues/symptoms.
In the initial phase we interviewed CXO functional leaders and each LoB VP/GM and his
director level reports for about an hour; capturing via pencil and paper everything he/she
came up with when asked to answer simple open ended questions such as ‘what is the
problem?’ or ‘what keeps you awake at night?’. During the next day or two we scribbled
comments on paper that were then categorized according to various functional
subheadings such as Accounting, Business Development, HR, contracts, PM, etc. (see
table 1 below and refer to the designator column and the key above the table). These
functional subheadings represent the area where the ‘gap’ in process performance (such
as the delta in the organization’s goal to achieve the stated metric for days-salesoutstanding, days to create a bill, order fulfillment, etc.). In addition to metrics gaps,
issues mapped to functional subheadings should address process and customer
requirements gaps as well (again refer to table 1).
Page 3
In the 'pre-blast' phase the executive leadership team collected all of the issues from the
various Lines of Business (LoB). During the 4 hour blast session, we prioritized the
issues using a common voting technique according to business impact and difficulty to
achieve and assigned each issue to one of four functional problem resolution sub-teams.
The idea was to resolve the easy issues within a few days and the more complex ones
within 3 to 6 months at the most.
Each of the sub-teams, Finance and Accounting, Contracts, Program Management, and
Business Development, consisted of key personnel and line managers. Issue resolution
work began in the afternoon after the four hour blast event. The sub-teams started on the
easiest just-do-it projects and were required to have resolution recommendations for the
just-do-its back to the executive leadership team in one week or less. Projects requiring
more analysis and solution selection effort were assigned project teams within that same
one week period. Each of the four primary teams presented their action plans to the
executive leadership team at the end of the afternoon. More complex projects became
lean initiatives or six sigma (phased DMAIC) projects.
Key steps in the process are:
1. Issue affinitization and prioritization
2. Root Cause Analysis to find salient causes followed by opportunity analysis to solve
problems
3. Team building
4. Project Chartering
5. Financial Benefit Analysis used to sum up costs saved and avoided.
Substantial benefits were ultimately obtained with this method. Application of this
method resulted in more than forty issues ranked by complexity and potential benefits
that were distilled from more than 165 initial seemingly random complaints. Twelve
issues were resolved immediately in the meeting, sixteen were assigned to just-do-it
teams and handled within two weeks or less and the five became six sigma projects with
charters prepared in the second half of the meeting.
Determining Kaizen Blast Objectives
The issues were collected from the internal customers representing the various LoBs and
outside suppliers and customers. This pre blast activity took us a couple of months to
gather the necessary data; each interview took an hour; planning and prep took 3½ hours.
Key—Resolution subteams assigned:
A—accounting
BD—business development
C—contracts
PM—project management
HR—human resources
S—CXO level and above management
Issues processed:
Im-
Page 4
Diffi-
Rank
Status
Designator
LoB Issues / Concerns
pact
culty
A1
Unavailability and lack of standardization of procedures on cost point processing, approval and
signature level approval causes confusion and wasted time. We need processes and we need
training on the available tools.
2
A2
A/P Invoices from vendors are not getting paid
2
A3
Expense Reports are not getting paid to employees
2
A4
Customers are not paying us quickly due to AR issues: A/R Measured by DSO (not invoicing,
improper DD250s, etc. that keep us from getting paid)
2
A5
We lack an Integrated Electronic Time/Travel/Expense system with electronic signature.
Currently we have to submit everything via fax or mail. This process seems unnecessarily time
consuming …
A9
We lack an adequate number of cost codes for trade shows. If there were a better structure for
the coding then reporting would be much less time consuming.
BD1
2
2
We lack advanced notice when an opportunity is coming down for a bid. When forced to seek
new business, we lack the processes to do so. Segment has provided some services that portend
to help do that, but we have not learned how to leverage these effectively.
3
2
BD4
Our lack of ability to grow new business organically with new customers causes a lack of
customer diversity. [Firefinder at Raytheon]
3
3
BD5
Currently proposals are written at the expense of my other duties. We need to plan better for
future growth. We need a long range vision.
3
2.5
BD6
The release of old or un-vetted images leaves XYZ open to legal action. Also, by releasing
documents with the old branding we can appear unsure of our own brand identity. This can
give our customers the impression that we do not know who we are.
2
1
BD7
XYZ is limited by corporate tradeshow guidelines. If the planning and budget were organized
earlier TSI would be better able to leverage tradeshow activity.
1
3
PMI
Lack the capability to determine resources needed and how to deploy them effectively
2
2
PM2
No access to Timely and Accurate Financial Information: Visual does not provide any access
to financial management information. I can’t access any actual vs. budget data. The only
information I can get is extracted via a query then dumped into a spreadsheet, manipulated by
someone, and then sent to me possibly weeks later..When I am able to beg/borrow financial
data it is often out of date. (Polson and other remote sites)
PM3
We lack management enforced guidelines that clearly define who is a subcontractor, vendor, or
supplier - and when to use which.
2
1
Q3
PM4
We lack a unifying project management system, currently we use several different programs
and it takes time and a lot of effort to use them effectively. We need an integrated system that
schedules and tracks actual labor, materials, equipment, and dollars against the schedule –
something that would tie CostPoint, Deltek, and Microsoft project together – or replace them all
3
2
T1
C2
Contract mods take too long so we can’t invoice $25M of my program. If I can’t get the
invoice to them in time I have to pay the government back $10K. Per contracts - the review
and approval process needs to be analyzed; Review of a contract can go from VP and legal then
to the vendor and around and around with small changes before it ever goes to approval. Then
approval process takes a long time because it requires too many people.
2
3
C3
The present contracting process is too time consuming, cumbersome, and ineffective in order to
support the LoBs (NDAs, TAs, etc. with vendors and suppliers and negotiating contracts with
customers)
3
2
C4
Right now too many people have access to make changes in CostPoint. We need less
people/right people to have access to alter data.
3
1
T1
C5
We lack a database tool with a tickler to alert on at risk contracts, and track contract value,
funding, period of performance, Status of Forces Agreement (SOFA), Technical Expert Status
Accreditation (TESA), TAs, and NDAs.
3
2
T1
C6
We don't have a formal cost management structure for XYZ. Who has the final say? The
current process leaves the PM in charge, and this is costing the company money.
3
1
T2
HR1
The on-boarding process is incomplete; i.e. coordinating office, computers, and new employee
orientation for new hires—we need a better one
2
2
HR2
No comprehensive process for exiting employees, a “term alert” process is needed to make
upcoming terminations known to a defined set of folks. We need a better exit interview system
with analytics.
2
1
HR3
Repatriation of expats; XYZ employees coming off of international assignments currently don't
have priority in the recruiting process. These employees should be placed first over new hires
from outside of the company.
2.5
1
HR4
Employee Change in Status (CIS) approvals/routing process requires HR approval, but there is
no apparent reason for this requirement.
2
1
HR5
Managers and employees are becoming increasingly disgruntled with the quality of
management. Management Training for employees being promoted into management positions
as well as new hires should be provided during work hours to promote/elevate overall company
morale.
3
2
T2
HR6
Job classification and categories – We have two people doing very similar work (if not the
same) with very different pay and in some cases one is exempt and the other is non-exempt.
3
2
T1
Page 5
2
Q4
2
2??
2
2
2
Q1
3
Our bill rates are not consistent between programs or within programs. We do not have a solid
handle or profitability of rates unless I list specific people with actual pay and then that is a
document I have to control very closely and cannot push down authority and responsibility.
HR8
We lack HR raise rules, or if they exist they have not been thoroughly communicated to
managers.
2
1.5
HR9
The Appraisal Evaluation system (DTN) is very time consuming for off-site employees w/o a
XYZ server or VPN to use.
3
3
S1
Lack of funding rules (or big rules) that allow segment to purchase an improvement solution
2
1
S2
When we are a pass-through for another Segment, we should be able to share the profit instead
of one Segment taking all profit and the other taking a loss. This would increase cooperation
between Segments resulting in more revenue, profit and bookings in the years ahead.
3
3
S3
There is a lack of understanding of our segment's capabilities and core competencies within the
LoBs. There is no system in place to ensure everyone understands our present efforts, or what
effort will be required to accomplish our goals and objectives for the future.
2
1
S4
Segment Support Matrix doesn't support the LOB's needs effectively or responsively. We lack
processes within the support matrix i.e. finance, subcontracting, human resources, and legal.
2
2
S5
Lack of Program/Segment Asset Management System
S6
Expedite data processing by better preparing for PMR submissions. This process takes time
and is more painful that seems necessary. It would be helpful if segment processes were
published on a website with glossary of terms and perhaps a frequently asked questions (FAQ)
section. In several instances e.g., for PMR preparation I have created guides for those who
contribute to the LOB inputs.
2
2
S7
Information required for recurrent forecasting in support of FOP, scorecard, and PMR reports is
drawn from various sources that are independently maintained, and the information drawn must
be manually combined each time. To ensure the information that is gathered is accurate I must
reconcile differences and attempt to update the sources for synchronization manually.
2
2
S9
It takes too much time to get budget approval for Capital Equipment Requests (CERs)
2
2
S10
Top level managers spend way too much time trying to search for the most current
information. The lack of a standardized management system is epitomized by our
“Management By E-Mail” approach. A systems approach would provide data sources (data
base) where information is loaded and then kept current by managers, instead of numerous
daily data calls where managers are asked to provide updates to information previously
submitted.
2
2
S11
Our current (remote site) facility is constraining our growth. This is really long term as
manufacturers think in terms of revenue per square foot. Significant growth can only occur if
there is sufficient space available to build the products. Alternatives to manufacturing as a part
of the solution has occurred in our Repair and Return jobs but might be expanded to other
service type efforts.
0
0
2
Table 1 Issues Scorecard for a DoD COTS Solutions/Services Provider
Difficulty:
1 = Push the easy button
2 = Requires new configuration of the system, change in procedure
3 = Barrier exists due to gov’t policy, physical constraint, et.
Impact:
1 = Cost avoidance/savings is not significant
2 = Cost avoidance is significant due to increase in productivity, decline in rework, etc.
3 = Cost savings to bottom line is significant (or perceived to be), or revenue
enhancement is significant
Status:
1 = Nothing done yet
2 = WIP
3 = Project complete
Page 6
Outcomes of the Blast
From the spreadsheet shown above, projects were chosen to work on over the coming
quarter; one to two easy projects and one harder project with potentially more impact in
each of four functional sub-team areas.
The following high impact projects were chosen:
1. A4—Stabilize and reduce Days Sales Outstanding (DSO) by 10 days or 15%
2. PM4—Define relationships between WBS and Control Accounts for Earned
Value goals
3. C4—Two part project
o Control data access
o Reconcile existing data errors (resolved over 13,000 errors resulting in
$4.01M in real cost avoidance internally) that if communicated to others
could result in bad decisions resulting in lost/missed opportunities;
increased labor costs, inaccurate A/R invoices that get kicked back.
4. HR6—Job Classification (now in compliance with DoD guidelines for job
categories and rates.
5. S10—Lack of centralized repository to capture data needed for ops reviews
Kaizen Blitz on the Chosen Projects
No belts are necessary for project execution. Projects were assigned to team leads. Two
of us that held belts were used by each project team only when necessary for complex
tasks in analysis or in setting up and implementing a pilot (BB skills were not really
required throughout the life of the project).
Project #1 was judged the best to pursue due to its potential high rate of return. A
reduction of 10 days for overall DSO would reduce cash trapped in receivables by over
$17M ($16.4M in cash invested + $1.15M in annual interest on $552M projected
revenues.
The next three projects (#2, #3, #4) listed above were deemed necessary to fulfill
regulatory requirements. Additional benefits that we were interested in achieving were
reduction of contracts database errors as already discussed above.
Project #5 stems from reporting requirements for a public company doing business
commercially in the U.S. (Sarbanes-Oxley requirements) or as a company doing business
with the government (DoD and various governmental agency requirements).
In addition to the high impact projects listed above there were various small quick hits or
‘low hanging fruit’ or just-do-it projects identified:
Page 7



BD6—The release of old or un-vetted images leaves XYZ open to legal action.
Policy changed and implemented the next week.
PM3—We lack management enforced guidelines that clearly define who is a
subcontractor, vendor, or supplier – and when to use which. Policy implemented
in procurement policy PN 2080
HR3—Repatriation of expats; XYZ employees coming off international
assignments currently don’t have priority in the recruiting process. Policy
changed the next week and implemented immediately in hiring practices
Example 2:
Using Strategic MGPP
Strategic MGPP is an alternative to the Kaizen Blast which can be used when time
constraints for solution are not short. The urgency is not as high as with the Kaizen Blast.
The objective is the same: identify and resolve issues. This method was applied to one
primary level field activity (PLFA) of the DLA initially and was later used to tee up
many other activities at HQ and other PLFAs.
The DLA suffers from many ineffective accounting, contracts, and project execution
processes and procedures that have never been addressed ostensibly because of the nature
of its culture. It is exceedingly difficult to get simple things done such as negotiate
contracts and rates with suppliers, deliver goods to customers and when they do to
receive payment from customers in a timely fashion. Strategic MGPP addressed these
long standing systemic problems.
In the 1st phase we interview the PLFA leader for about an hour; capturing via pencil and
paper everything he/she comes up with when asked to answer simple open ended
questions such as ‘what is the problem?’ or ‘what keeps you awake at night?’. During
the next day or two scribbled comments on paper are categorized and organized into what
we call a ‘categorized symptoms list’ (see table 2 below). Each category will map to one
or another focus area that are related to customer requirements, metrics or process
improvement ideas/opportunities.
Intermediate objectives that can be interpreted as necessary and sufficient prerequisites
can be deconstructed from the categories of the symptoms list and are written down line
item by line item. Potential projects are the result of groupings of intermediate objectives
that resolve a related set of particular symptoms. A description of a project can then be
written that captures each of these groupings of symptoms and objectives. This is done in
turn for each focus areas and then organized by phases.
Substantial benefits were obtained with this method for DLA PLFAs such as Aviation,
Troop Support and Energy. We have trained Distribution personnel in this method as
well and will be developing their MGPPs early in 2013.
Page 8
Once you have an actionable strategy as delineated in the MGPP, process performance
measures can be applied to select projects. A pitfall to be avoided is selecting each
project independently. This is analogous to spending five minutes starting to clean ten
different rooms in a house, versus spending 50 minutes to completely clean one room. In
the first case, it is difficult to see what impact the effort has had; in the second case there
is a visible, tangible success that will now be ready to be leveraged elsewhere. It is
preferable to launch a Lean Six Sigma effort by focusing on a few strategic areas, rather
than 10 or 20. The process performance measures determined by senior leadership help
everyone focus the initial projects strategically.
Using the project selection criteria, a set of initial candidate projects is gathered. The
projects are gathered and prioritized for assignment to a Black Belt or Green Belt
according to criteria similar to those shown below. In later deployment phases, your
organization will develop an ongoing system to identify potential projects, rank them, and
place them in the project hopper, so that there is a continuously refreshed list of good
projects.
Every business is different and you should ensure that your specific priorities are taken
into account when evaluating and prioritizing potential projects. The characteristics of a
good Lean Six Sigma project are:

Clearly linked to organization’s priorities

Problem is of major importance to the organization
o
o
o

Major improvement in process performance (e.g. >50%)
Major improvement in productivity
Reasonable scope—doable in 4-6 months
o
o

Linked to strategic and annual operating plans
Support for project often decreases after 6 months
Project scope too large is a common problem
Clear quantitative measures of success
o
Baseline, goals, and entitlement well-defined

Importance is clear to the organization

Project has the support and approval of management
o
o
People will support a project that they understand and see as important
Needed to get resources, remove barriers, and sustain over time
Page 9
Figure 1 Example MGPP from a field operation of a government agency
Page
10
Phase #
Phase Description / Symptom List
Type
Milestone Review process opportunities
1
101 Multiple and time intensive milestone reviews for Energy Savings Performance Contract (ESPC) task order award
102 –ESPC task order awards must have five different milestone reviews each approximately 30-60 days
103
104
105
106
107
108
112
113
114
115
116
117
118
119
120
121
124
125
126
127
128
129
130
131
comment
requirement
–Two additional B1 reviews (Part1 and 2) were added. Multiple briefings to multiple parties are req’d for each milestone review. Significant amount of
‘idle’ time accumulated while trying to coordinate schedules.
requirement
–Energy Service Company (ESCO) selection process established in the basic IDIQ
–Milestone reviews are in addition to the monthly and quarterly procurement reviews being held w/ Policy, Operations Director/Deputy, and HCA
(quarterly reviews only).
requirement
comment
Improved efficiency – savings of time and money by eliminating non-value added milestone reviews and/or consolidating milestone reviews (i.e.
opportunity
single review vice multiple iterations of the same milestone review to multiple parties)
Improved customer satisfaction--More timely execution and award of ESPC task order allows customers to begin energy savings sooner; DLA Energy is
opportunity
a provider of ‘choice’ for customers in the ESPC arena. May turn to other providers if we can’t provide timely support.
Streamline time to do reviews (Regulatory process defines review, M1 time to do review, two-step required)
opportunity
During major milestone reviews of UP procurements, the reviewers are often not as familiar with that type and size of procurement. Unintended results
issue
can include 1) reviewer questions that do not apply to UP procurements, and 2) extended review periods.
A process is needed to provide milestone reviewers sufficient familiarity with the differences (and similarities) between UP procurements and other
issue
procurements more commonly reviewed during the Milestone events.
Milestone reviews of UP procurements can be focused on the most pertinent areas
comment
Milestone reviews can potentially be shortened without sacrificing quality or comprehensiveness of reviews
opportunity
More efficient use of personnel resources in 1) preparation of the procurement review package, and 2) conducting the ensuing review of the package
opportunity
E-procurement forces clauses that are not required
issue
Policy review process takes too long
issue
comments are not substantive from reviews
majority of comments appear to be focused on grammar instead of regulatory compliance
issue
issue
Jr. policy procurement analyst w/ less experience in review process and w/ ESPC are often signed up to do reviews.
issue
Sr, analysts get to do peer reviews (esp. when > $1M opportunity)
comment
More oversight with increased $$ value
comment
Government procurement process is not in line with Commercial procurement process
issue or comment
Don't have a predictable schedule
Review meetings appear to be set up just to have paperwork signed, when all comments have been worked out between the specialist and the policy procurement
analyst ( waste of time). Why not just e-sign
issue
issue
When review meetings are set up the comments are not presented until the meeting; need comments sent ahead of time.
issue
Too often, the contracting officer has to get their deputy director involved to get reviews completed so the proceurement can be moved forward. This escalation is not a
good use of her time.
issue
Time frames for review are unrealistic. The DEPI (a local instructions guidebook procedures) indicated reviews will be done in 5 days. If not the case, they need to know a
realistic time frame so they can appropriately build in the time in the acquistion time line.
issue
Process Dif's related to Bulk
2
201 Competition is the key to achieving the lowest possible pricing
observation
The goal of this effort would be to identify, through direct contact and open dialogue with industry, cost drivers and barriers to
202 program participation that could be modified or eliminated to help reduce supply costs and enhance competition
DLA Energy Bulk solicitations and market engagement would be examined, modified and simplified where possible, to
203 obtain potential benefits identified during the process
204 More streamlined, commercial solicitation process
205 Increased competition and lower prices
206 Increased focus on issues that influence product price and availability to DoD
207  Look at how we buy bulk product; we are less and less commercial; decreasing competition
208  We are driving people away
209  Why they are not playing?
210  M1 Decrease overhead
o M1 level of competition
211
213  Reduce procurement cost
214  Increase # of response to solicitation
suggestion
suggestion
want
want
issues
Increased oversight has had a significant impact on the way they do business. Suppliers are not willing to deal with both additional
215 requirements associated with doing business with the government and with increased unpredictability in time to contract.
216 Process went from 7-8 months to 14 – 18 months
217 Additional review time is being caused by the PMR Review
From Business POV, there is an opportunity to see if solicitation process can be streamlined and aligned with commercial procurement
218 processes
219
220
observation
issue
observation
observation
Suppliers are apprehensive about giving prices for a contract that is going to start 18 months in the future.
issue

issue
Since contracts are a year, contracts must be extended
Standardize Solicitations
3
As a result of feedback from DLA/J-7 and DPAP, we should review format/structure of solicitations to standardize DLA
Energy solicitation formats, ensure required required regulatory/statuatory clauses are included and comply with DLA/J-7
guidance regarding local contract clauses and provisions.
Improve the quality of solicitations to achieve the best solicitation possible that includes ALL required FAR and DFARS
clauses and certifications.
Direct Delivery, Bulk Fuels, Installation Energy, Acquisition Policy and Oversight Office and Office of Counsel
301
302
303
304
305
306
307
308
309
310
311
312
313
comment
comment
Streamline to be consistent with commercial process
suggestion
 Book is 30 – 70 pages long => 10 pages or less
suggestion

Provide checklist for solicitations clauses
suggestion

M1 pass fail solicitations
metric
Why do Energy solicitations look different from other solicitations that OSD reviews
question
Energy does not have standard contract format that is utilized by all the business units.
observation
DLA Energy has 682 contract provisions; most of DLA Field Activities use FAR/DFRAS/DLAD Claues and not local contract provisions.
observation
Uniform contract format (UCS) we don’t use that format which is prescribed by the FAR.
observation
Not confident that all required clauses are in contract or that we don't have clauses that are not applicable.
observation
eProcurement will NOT solve problem as energy was not part of the development process; ergo no rules
observation
Page
11
Everything else not touched by review process, related to bulk or solicitations
4
•The DLA Energy coordination process between CPA and Legal currently takes between 2-4 weeks, depending on the
complexity of the document. An opportunity for improvement exists if the timeframe for this coordination could be
401 shortened.
402 •Delays in coordination between CPA and Legal has a direct impact on issuance of solicitations and making timely awards.
DLA Energy’s ability to meet milestones could be achieved more efficiently if clear timeframe expectations and tracking
403 measures were established between CPA and Legal.
•Improve timeframe of the joint review process between DLA Energy Procurement Oversight Branch (CPB) and DLA
Energy Bulk Petroleum, Domestic Storage and Services Division (BXB) from pre-solicitation to award. Improvements
should shorten the overall joint review process.
•Delays between Bulk and CPB have a direct impact on issuance of solicitations and making timely awards.
The ability to issue solicitations and make timely awards is mission critical, as it impacts our success in supporting the
warfighter.
404
405
406
407
408
409
410
411
412
413
414
415
416
417
418
419
420
421
422
423
424
425
(A) Utility privatization has established customers
If we continue to be slow, customers will go elsewhere for ESPC
DLA policy office milestone reviews hold up the process
Policy people are not familiar with contracts
Install/Energy (in general) wants new customers (as many as possible)
Bases want to privatize utilities but Policy Office (PO) is holding up (transfer of water, gas, e- from commercial sources)
·
·
·
·
o
o
·
Internal resource issue?
Expanded to include J7
2-4 weeks PLT
No metric for turn around
Litigations
Contingency contract
Contracting instruction needs to be broader
·
o
o
·
·
·
Combine two offices
Apply to Direct Delivers
Apply to supply
Have separate regulations, cuts across service contracts
Apply to consulting contracts, not high $ value
Focus area scope, enlarge scope
5 Policy
501 Turn around on when we gt the documents from reviewers. Information back to policy.
501a Solutions keep the same
502 Learning curve for new analysts
503 Scheduling meetings because of flex schedule w/ buying unit (BU). Requires price analyst, contract specialist, outside CO, actual CO
Have a board held with in 5 days (now 7 days). Analyst 2 days, chief 2 days, Doug Smith (assoc. DAPO) 2 days. Get comments ahead of time. Have questions to Doug up
504 front.
505 No time to type up comments to give to the BU prior to board. The additional people don't provide comments ahead of time (price analyst & outside CO)
506 Bulk : We do the same procurement and but the threshold makes the peer review required by OSD.
506a New OSD done after acquisition has been rewarded.
507 Post mortum review after acquisition. Went from J7 taking 20 days to review to J7 from every milestone review needing 20 + week to give response.
508 Final determination a week or two after submitted final response
509 Proc letter went from 2 weeks to 20 days for peer review level only. Solution--have consolidated up to Gabby and have board meeting with Gabby.
510 Level of reviews required because of work and complexity of the review.
511 Possible solutions-- Certain Dollar Level approval by Doug.
Changes in regulation( such as a change in FAR) where the BU will not take action bacuse they are waiting on a Contract Instruction (CI). Implementation of policy documents
512 are not in accordance w/ guidance.
513 People don't understand that they should follow the guidance.
514 People need to read policy, implement policty, educate themselves of policy.
Table 2 Issues or Symptoms from interview for Strategic MGPP approach
Analyzing the Issues
The initial set of issues was obtained in this process from one-on-one interviews of each
director. The result was the affinitized symptoms list in Table 2 above. The affinitized
categories were then used to create the issue mitigation language used in the MGPP.
Putting together a phased approach
Next focus areas and project development/selection/implementation activities are
organized into workshops as follows (workshop 1 results in the capture of Undesirable
Effects (UDEs) that are integrated into intermediate opportunities in the MGPP resulting
in projects with charters as already shown above):
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Picking the Projects
Once you have an actionable strategy as delineated in the MGPP, process performance
measures can be applied to select projects.
Compare and Contrast the two Approaches
The 1st example extolls an approach suited for fast action; max buy-in of the CXO level,
VP/GM level and their direct reports in a typical DoD contractor environment.
The 2nd example uses an approach more suited to a top-down bureaucratic public agency,
the DLA. Would the opposite approaches work in the other environment? Answer is of
course ‘it depends’. I have used both approaches on more than one occasion and seen the
benefits of each first hand, so it is reasonable to assume that either approach would work
in either situation. However first consider the plusses and minuses of each:
Kaizen Blast +/Plusses
The event can be accomplished in 1 ½ days
Brings everyone together in an actionpacked highly charged environment that
promotes quick decisions
Compensates for a company with a weak
culture with little or no real commitment to
excellence (i.e. a company run by sales)
Minuses
It takes week to plan and coordinate the
calendars of the execs
Requires a large room to perform most of
the activities and multiple team rooms to
complete the group activities
Requires follow through meetings before
CEOs staff to demonstrate progress
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High rate of return was realized for a rather
small investment
JDIs and RIEs can be teed up immediately
after day 1 with the expectation that results
will be immediately forthcoming
Without doing these events on a regular
basis v. an ‘as needed basis’ it is hard to
foster commitment again to be able to
schedule and hold such an event; again by
performing a blast event regularly it would
become part of a CPI culture
RCA typically only done on a per project
basis for complex projects requiring
DMAIC approach
Table 3 Benefits/Detractors for Kaizen Blast
Strategic MGPP +/Plusses
Necessity and Sufficiency is guaranteed if
each step of the phase is followed
according to protocol (verification and
validation is demonstrated).
UDEs come only from the issues that are
raised by ‘the big guy’ w/o input from the
‘peanut gallery’ of lesser employees so the
message is not muddled
We don’t care about anyone’s input but the
big guys; we only aim to solve his
problems
Use of Root Cause Analysis early in the
game helps to frame the boundary of the
solution space
Minuses
Each phase of the process takes time and
must be verified prior to going forward
with the next phase
No input from the rank and file means that
the ‘big guy’ better be right in his
assessment of the state of affairs and the
true meaning of the issues he raises
The big guy must be in it for the long run
& have the support of his board; I have
seen admirals come and go
Typically results in more DMAIC projects;
should be used at enterprise level focusing
on issues important to executives
Table 4 Benefits / Detractors for MGPP
Given the information from the table above it seems that autocratic organizations might
be better served with MGPP and democratic cultures with Kaizen Blast but this is not
necessarily the case. More often than not, the approach that is used is determined by
access; if you have access to the executive staff and need to flush out business and
customer issues at the strategic level then one should probably use Strategic MGPP. On
the other hand, if you don’t have a key to the executive level floors, you most likely
should use the Kaizen Blast approach and focus on issues that are associated one level
down at the process performance level.
With regard to considering using the Kaizen Blast approach, it is also important to
consider key variables such as time it takes on the front end to organize an event as it
may be better to get the initial impression from the champion directly by interview and
then fill in the blanks with his/her direct reports as this may take must less time trying to
pull off a more organized Kaizen Blast event that requires coordinating people’s calendar
and in addition to reserving rooms.
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Conclusions:
Kaizen Blast is typically a one day event packed with activity and production. The
aftermath and follow-up effort was significant and produced tangible improvement
benefits at the process performance level. Like many service-oriented process
improvement gambits, it has taken much time to assess the true benefit of the projects
that were hatched during the blast. We summarize below:
When to use Kaizen Blast:
1.
2.
3.
4.
Company/agency, etc. has a weak culture or is sales-based not customer-based
Need an energized company-wide enterprise event to publicize
Can use either with an entity that is either product development or services based
No standard processes as project execution processes and procedures were left
over from various mergers and acquisitions.
5. Need an efficient means to collect, coordinate and resolve festering issues in a
reasonable amount of time.
6. Company culture relies on consensus more than on the opinion of the ‘big dude’
7. Engagement starts with C-level and adds VP/GM and adds their director inputs
Like the Kaizen Blast approach, MGPP starts as a give-and-take
interview/clarification/re-interview process but may take a few days to gain consensus.
When to use ‘strategic’ MGPP:
1. We don’t care about anyone’s input but the big guys; we only aim to solve HIS
problems: “Hey this ain’t no democracy, I run this division and I have all of the
votes…”
2. Can use with company/entity that is either product or services based
3. Company initiatives only move forward under the direction of the ‘big dude’
4. This use of MGPP is at the ‘strategic’ level with the C-level in a company or
deputy-director level or above at a government agency
About the Author:
Kevin Lehigh is a MBB at Lehigh Technical Solutions, Inc. He has implemented Lean
Six Sigma and Theory of Constraints to DoD customer’s internal processes and in
industry for over 14 years. He is currently a contract Master Black Belt at DLA
Headquarters where he works with managers of DLA Enterprise Continuous Process
Improvement projects.
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