Deep-Sixing Waste

In April, President Obama challenged Cabinet members to cut $100 million in waste and inefficiencies from their budgets. Agencies responded with relatively modest plans to cancel conferences, make travel reservations online and, in the case of the Forest Service, to stop repainting new vehicles. Combined, the proposals would save $243 million during fiscal 2009 and 2010.

But some federal officials have bigger reforms in mind. Using Lean Six Sigma --a technique popularized in the private sector -- agencies are discovering innovative ways to streamline programs and eliminate burdensome administrative processes.

Lean Six Sigma is a combination of two well-known business improvement methodologies; Lean focuses on reducing waste, while Six Sigma eradicates process defects. Federal agencies now are using the tool to make government operate quicker, cheaper and more efficiently. The methodology requires users -- trained as either entry-level green belts or more experienced black belts --to review every step in a process to determine whether it is necessary and effective.

"A big advantage of Lean Six Sigma is empowering the workforce to take more control of the changes to their day-to-day situation," says Peter Russelburg, the Lean Six Sigma program manager at the General Services Administration's Office of Performance Improvement.

"Typically, they are just as frustrated with the situation as leadership or whoever may be coming in to look at the organization."

The Pentagon is the strongest government proponent of the technique. The Army and Navy have used the tool at the installation and program levels for several years, but those efforts were voluntary and lacked departmentwide coordination. That changed in April 2007, when then-Deputy Secretary of Defense Gordon England, who had success using the method in the private sector and as secretary of the Navy, issued a directive calling on managers to adopt Lean Six Sigma across all lines of business. England also created a high-level program office to manage the effort.

J.D. Sicilia, director of Defense's Lean Six Sigma Program Office, describes the venture as "the most complex deployment of this methodology ever attempted." Recently, Defense used the technique to examine its lengthy process for granting security clearances to new employees. Officials found unnecessary or redundant steps in the process and were able to reduce the cycle time from more than one year to just over one month.

Using a similar approach, Pentagon officials were able to ramp up production of mine-resistant ambush-protected vehicles -- crucial life-saving equipment for troops in war zones -- from five to 50 daily. Ongoing projects include a thorough review of Defense's hiring process and the department's management of 160,000 steel equipment containers in Iraq and Kuwait.

"This methodology challenges the status quo because it asks you to show the data on your performance levels," Sicilia says. "It's not personal or subjective. It's a very data-driven methodology."

Other Defense components have been equally bold. The Naval Supply Systems Command, for example, is developing a way to integrate its wholesale and retail supply operations into one business management system. The service currently operates multiple systems to track parts and supplies.

Through a single supply solution, Navy leaders will be able to locate assets easily and eliminate some excess storage locations, says Nicole Davis, who works in the Lean Six Sigma Continuous Process Improvement Office at Pearl Harbor in Hawaii. "Our black belts have been focusing primarily on helping the organization to transition from the way we do business today to the way we'll do business in the future," she says.

Lean Six Sigma disciples are scattered governmentwide. At least 23 agencies are using the technique, with dozens more expressing interest, Sicilia says. For example, in a six-week project, GSA was able to significantly reduce the number of adjustments that accountants were making on worksheets for time and accruals. The review helped the agency maintain its clean audit opinion and will free up three or four employees to work on other projects, according to Chief Financial Officer Kathleen Turco.

"It gave staff at the mid-level -- the GS-13s and 14s -- ownership of the process and of the data," Turco says. "That has been the most positive outcome. They now understand how their actions affect their customers."

Often, the solutions garnered from Lean Six Sigma are anything but high tech. Generally, examiners discover employees are relying on outdated regulations or program offices are failing to follow standard operating procedures. "This process is an unveiling of what is going on below the surface," Sicilia says. "Through hundreds or thousands of projects we learned there is no SOP. Someone started to do something a certain way and they bring their own nuance and nothing is documented. And if it is documented, it's often outdated. Roughly 70 percent of our improvements come from understanding what the SOP was or should be and then following it."

Since 2007, the Defense Department's Lean Six Sigma office has completed more than 330 projects and trained more than 1,000 Office of the Secretary of Defense officials on the technique, allowing them to take on new projects themselves.

More than 30,000 employees departmentwide have been trained in Lean Six Sigma during the past six years.

And, while there is undoubtedly a monetary benefit to the project reviews --Sicilia identified $12 million in savings through his projects -- they rarely end up on a budget line. More often, the results are operational improvements that lift morale and improve customer service, says Sicilia. "The idea is the culture and the fabric of DoD starts to shift to one that cares about performance and is not satisfied with the status quo," he says.