Posted by: knightbird | February 9, 2015

Use of Sensationalism to Fight Budget Cuts

As Governor Walker’s FY 2016 budget is scrutinized, those targeted with budget cuts react strongly. They analyze the impact of the proposed cuts based on their current productivity, and alert their friends and supporters. If they are big enough, they alert their lobbyists. Then the advocacy starts. It doesn’t take very long. The Governor’s budget was just released a couple of weeks ago.

The press has already been alerted to the proposed cuts for restaurant inspections. Dire consequences are predicted. There will be more food poisoning incidents because we will have to reduce the number of inspections we can make. Research is done on violations that have occurred in the past and the most egregious will get replayed. Violations will go unpunished. The sensational will be discussed ad nauseam until the budget is adopted. The goal is to restore funding to the prior level. In good years the priority is to increase the budget. In really bad years, the goal is to reverse as much of the cut proposed.

And many other entities that believe they might be targeted go into defensive mode. Effort will be spent to prevent talk about any cuts. Horse trading happens: I will support your program if you support mine. The amount of time and effort spent on the budgeting process becomes exorbitant. It would be a great study to examine the amount of effort spent on protecting your interests in the state budget. And I mean time, travel, expenses and support. It’s a lot.

But the state budget is no different that a business budget. And many business executives believe that budgets are a waste of time. Jack Welch said it clearly and succinctly:

“The budget is the bane of corporate America. It never should have existed. A budget is this: If you make it, you generally get a pat on the back and a few bucks. If you miss it, you get a stick in the eye–or worse.

Making a budget is an exercise in minimalization. You’re always trying to get the lowest out of people, because everyone is negotiating to get a lower number.”

The budgeting process in Alaska is very expensive. Agency staffs spend substantial amounts of time developing their budget. It is rolled up to a budget staff that makes judgments about the level of spending that can be supported and says yea or nay. Revenue forecasts are developed and every hiccup in the revenue market is immediately analyzed. All of that information is pored over. Then there are winners and losers. The only alternatives presented in a budgeting process tend to be how to raid additional sources of revenue.

What is an alternative discussion? For me, it’s improving performance. Not by just cutting the budget and telling your staff you have to continue to do the same amount of work—just do it. We can improve performance in any process by a substantial percentage. Depending on how you measure performance, we can achieve 50% reductions in staff effort to achieve a result similar to their existing production. I did not say we reduce staff by 50%. That’s like telling me to go cut a switch so my parent can spank me. I don’t want to do it. Instead, you structure the improvements in a way that preserves employment and results. When you achieve improvement, you work on the backlog of work. When the backlog is finished, you start to assume some or all of the contracted work (if any). Then you have your employee work more on improvement events, including for sister agencies. When there is no more work and you have more employees than you need, you work on reassignments. When employees quit, resign or retire, you let attrition take care of the reduction.

So how do we improve the restaurant inspection process? First, we need to know what we do and how we do it. We start by identifying the number of restaurant inspections we have to handle—annually, monthly and weekly. The employees gather this information in a Kaizen (or improvement) event. Then they map what they do. This may be random and chaotic, but it is a process. It can be measured. And it can be improved. Once the process is mapped, staff uses a concept called 8 wastes to strategize on how to reduce or eliminate them. They visualize a future state and develop a project plan on how to get there. Then they do the project. They check for results and if the results are favorable, they write up standard work and start performing the work according to the new standards.

The inspection process will improve through use of Lea Government. And staff will learn that they rely on may pull systems that cost them precious value adding time that could be spent on inspections. And they can work to improve those pull systems. Envisioning the improvements will be hard to start with. But it is achievable.

Now lets talk about blowing the socks off of our restaurant customers and envision a system where all restaurants are excited and actively working every day to give their customers an experience that blows them away. By demonstrating the successes for application of Lean thinking to restaurant sanitization processes, we can reduce the cost for restaurants to achieve great sanitation results by 33%, according to this article. What a difference in philosophy. When you have restaurants reducing their costs and improving their sanitation scores by Lean process improvements, the inspections get easier. And follow up compliance work is eliminated. So answer this question for Alaska. Why aren’t we talking openly about Lean Government?

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