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As public service organizations wrestle with the “new normal”—squeezed budgets, despite a growing demand for services—the need to operate more efficiently and react quickly is placing renewed emphasis on pursuing the right outcomes. Indeed, if we are to follow Toynbee’s1 findings on the rise and fall of civilizations, failing to meet the market’s challenges is not an option. Accenture argues public service executives already have tried and tested techniques at their fingertips to turn the tide of economic constraint. By adopting the methodologies and practices longestablished in the private sector, the public sector can not only cut costs, but also gain citizen-centric results which lead to high performance.
The need to act has never been greater. Government expenses are soaring, driven in part by an aging workforce, rising healthcare costs and underfunded pension funds. The missions of most agencies are expanding as citizens’ expectations rise. At the same time, tax revenues have stagnated or declined, and economic stimulus programs, funded through deficit spending, are waning. As markets tighten, the choice between raising taxes or cutting services seems inevitable. Against such a backdrop, public service organizations must be prepared to adapt. So how can governments become more lean and continue to serve the public?
Strategy firstLooking to the public sector’s counterpart, the private sector is accustomed to competing for survival in turbulent times. No stranger to the term operational excellence, a hybrid of a 30-year old movement that inspired such programs as total quality management or Lean Six Sigma, private sector organizations know a thing or two about highly efficient service delivery. Indeed, the more sporadic improvements in the public sector have shown one thing—effective improvement begins and ends with strategic alignment, linking specific projects, initiatives, training, and job responsibilities to the organization’s most important objectives.
The stakes are high. Yet in our latest book,2 Accenture shows how forward-thinking public service organizations can reduce, costs by at least 10 percent to 20 percent while improving quality and speed at the same time. How? By adopting a new approach that generates greater productivity within the resource and time constraints currently faced. From our experience with leading public service organizations, Accenture has found there are three main factors that realize improvements to inefficient work activities, reduce waste, and encourage streamlined programs that achieve more with less:
Focus on operational excellence.Employing methods such as continuous process improvement (CPI) to eliminate waste and improving quality throughout a process can increase productivity without additional resources. Most importantly, leaders tackle the productivity challenge with an enterprise view of the production processes, applying an end-to-end approach. Where is it working? New York’s Metropolitan Transportation Authority, a state agency serving New York City and surrounding counties, is the Western Hemisphere’s largest public transportation provider, with approximately 8.5 million riders every weekday. The MTA had an immense pipeline of operating projects that ranged from facility improvements and software upgrades to the replacement or refurbishment of worn-out vehicles. The agency looked hard at these and other programs using a project elimination and deferral approach to prioritize its spending more effectively. Of 280 projects evaluated, 141 were identified for elimination or deferral based on the mission-driven criteria developed by the organization. As a result, the MTA achieved savings of $40 million in 2010.
Drive agility.Rapid response means an organization can adapt, change and innovate quickly. Committing workforces and budgets appropriately means leveraging the right internal and external resources to guide decision making and free up employees to focus on the job in hand. Where is it working? The French Ministry of Interior was able to develop a lean “accelerator” to standardize the naturalization process in France. Average processing time was reduced by 20 percent and as much as 32 percent, while improved workflows have reduced stress levels and increased consistency and applicant satisfaction.
Adapt the workforce and culture.Create a learning environment where the workforce can thrive, both today and in the future. As employees benefit from the opportunity to develop new skills and competencies, and the chance to become more connected with their customers, so these attributes help to drive agility and operational excellence. Where is it working? The Defense Logistics Agency-Business Systems Modernization project involved revamping the organization’s entire supply chain process and optimizing its use. The transformational process affected the work of more than 700 employees. However, with clear mission and goals in place, high-level sponsorship, ongoing communication with stakeholders, detailed planning, clarity around new roles, and responsibility- and role-based training for employees, the agency was able to successfully reconfigure its workforce and create more effective logistical support capabilities, and reduced operational costs from 22.1 percent to 14.4 percent in one fiscal year alone. Equally important, response times for filling key orders have been reduced by as much as 30 percent.
Accenture has worked with many public sector organizations to encourage a lean, operational excellence approach:
The Ministère des Finances in France employed lean boarder control, improving the percentage of passengers waiting 15 minutes or less from 50 percent to more than 80 percent, while increasing detection levels and trained more than 800 people across more than 15 ministries in France.
The US Marine Corps managed to accelerate the production of its mine-resistant ambush-protected vehicle (MRAP) from 10 vehicles per month to 70 vehicles per day by reducing the amount of resources and cost needed.
Her Majesty’s Revenue & Customs (HMRC) in the United Kingdom had to identify savings of more than £1 billion. Accenture worked alongside the business to develop a process management capability which provided a common framework and tools that enabled more consistent decision making and helped increase efficiency and reduce costs.
The US state of Ohio realized productivity improvements of up to 20 percent, while costs for processing travel and expense reports have been reduced by more than two-thirds, from $37 to $12 per transaction, a drop of nearly 68 percent.
Keen to be leanAs our research has shown, key behaviors can dictate the “best leaders” in achieving high performance in public service. By building operational excellence, developing agility, and creating a supportive culture and workforce, public service organizations can set the foundation for increasing output and quality while reducing the amount of resources and cost needed. In short, public service leaders can develop the right organizational anatomy to alleviate the fiscal pressures, effect positive change and pave the way to high performance.
To learn more, please contact:Mark Pricem.email@example.com+1 614-915-3661Walter Moreswalter.firstname.lastname@example.org+1 954-646-1074About AccentureAccenture is a global management consulting, technology services and outsourcing company, with more than 244,000 people serving clients in more than 120 countries. Combining unparalleled experience, comprehensive capabilities across all industries and business functions, and extensive research on the world’s most successful companies, Accenture collaborates with clients to help them become high-performance businesses and governments. The company generated net revenues of US$25.5 billion for the fiscal year ended Aug. 31, 2011. Its home page is www.accenture.com.
1 “A society that successfully meets and surmounts successive challenges will continue to grow to new levels of civilization. But as soon as that society fails to meet a challenge, it must inevitably decline.” Arnold Toynbee, A Study of History
2 Authors Mark Price, Walter Mores and Hundley Elliotte, “Building High Performance Government Through Lean Six Sigma: A Leaders Guide to Creating Speed, Agility
February 15, 2012
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