NSW Premier Keneally has issued an new Memorandum on Better Regulation reporting. With an aim of finding $500m by June 2011, the Premier is asking agencies to report:

• achievements in cutting red tape over the previous 6 months, including quantification of the cost savings of reforms to business, government and the community using BRO’s tool Measuring the Costs of Regulation
• plans to cut red tape over the next 6 months, including estimates of expected cost savings of reforms
  using the measurement tool.

Several of our previous clients have chatted to us about the difficulty of quantifying regulation savings. One thing they had in common was that they weren’t looking at what they do in terms of a flow of service to a client/customer. Meeting activity and delivery targets set by Strategy and Planning departments is one thing; actually reducing the time to completion from the customer viewpoint is another.

One of the most difficult things is to change your plane of vision from inwards - meeting the hierarchy’s demand for target numbers, evaluation and reporting - to outwards, where you consider the one thing customers/clients want from reduced regulation: faster end-to-end process turnaround.

Oddly enough, faster E2E processes deliver both better service and cheaper operations. The trick is how to find ways to speed up that process to completion.

Hate to make the sales pitch, but that’s where we can help.

James.

PS: I’ll blog later on the BRO quantification template.

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The NSW Government issued a revised Guide to Better Regulation last month. Better Regulation is something we keep an eye on because of the importance of process in streamlining regulatory action.

You may have encountered the term “failure demand” previously - I’ll blog about it elsewhere - but often it is process failure that causes time delay and extra work. This extra work is “failure demand” - workload that only occurs because the process isn’t working properly. More than one frontline visit, client phone calls to check on progress or get help filling in forms, followup because supporting documents not supplied, and so on.

Failure demand is a key part of regulatory load experienced by both agency staff and the public client. If you don’t address it, you can create as many targets and reviews as you like, but the experience will still be one of red tape.

For us at AG though, the most interesting thing about the review is what the (then) Premier is reported as saying:

Mr Rees said key amendments in the revised Guide included placing greater emphasis on the quantification of impacts to help reduce red tape; placing greater emphasis on simplifying existing regulation; additional information on preparing and submitting Better Regulation Statements; and simplifying Executive Council proposals.

Quantifying impacts of process change. Mmmm.

James.

Tags: better regulation, failure demand, quantification

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Having worked in academia, multinational corporate, public sector, and SME, I have always been struck by the complete waste of money that is most corporate travel. The conference justification: contacts.  The fly-four-hours-to-meet-for-an-hour justification: it’s political.  And I could list a lot more.

Which is why I am encouraged by the growth of serious and fully functional teleconferencing. Collaboration does need voice as well as internet - there is no doubt email can result in misunderstandings and unnecessary offence sometimes. But agencies now have access to equipment and service providers that make tele-collaborating effective. See here for an example (no endorsement intended, just a random private provider).

And if you save money on travel and accommodation, you can spend it somewhere else. Like on frontline services or programs building to results.

Like every other money saver, it comes at a price. Primarily the extra effort involved in making sure things work right when done at a distance. But if it saves money and keeps services running, it’s probably worth it.

James.

Tags: teleconference, travel

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Andrew Burrell in today’s AFR reports on the $7.6bn blowout in all State Governments’ spending from 1 July 2008 to 1 July 2009 (no link, behind sub firewall).

His claim is that this was mainly due to blowouts in PS wages costs, by 7.5% in NSW, for example. This blowout was in the face of an economic downturn, but with rising revenues, as federal grants meant that revenues actually rose for some states. Of course, their expenses grew by a larger percentage – mostly due to wages.

I’m doing some research on public finances and public sector staffing arrangements - my postgrad economics meshes nicely with our business - and will be publishing early next year, so this really fascinates me. I know, it’s kinda sad, but it gives us a great base to understand the pressures on the public sector.

What all of this reveals is the importance of actually following through on the standard government promise of limiting expenditure growth or even reducing it. Which hasn’t happened since the Greiner 1990s.

Which suggests the public sector - NSW and WA in particular - have got some serious reviews of process, work practice and staffing models in their future.
James

Tags: deficits, public sector, wages

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Elements of the June 09 NSW Budget will put more pressure on public sector organisations to deliver productivity savings.

Faced with the need to get the budget back into surplus, the NSW government has relied heavily on projected cost controls to bring revenue and expenses back into line over the next three years.

They have also flagged creating 13 super-departments that merge some 160 public sector agencies.

All this means that public sector managers will be under greater demands to find savings - and probably in a shorter time, given the election is in 2011.

Read more on the budget here.
James.

Tags: budget, productivity savings, public sector

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Recent brain-based research points to why involving people - and getting them to come up with the ways to improve processes - makes the change stick better, create less trauma and last much longer.

Process improvement is successful when three factors are aligned:

• processes are clear (whether new or existing)
• managers support the change
• people have behaviours to support the change.

For this reason, any process improvement or productivity improvement program we do includes at least 3 components:

(read more)

Tags: coaching, methodology, process improvement

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These are the sorts of questions we ask when we start out in organisations:

• what you do - and why we need to look at it
• how long it takes
• where you discover errors, what causes them and what’s the root cause
• where does the time vary to complete an activity - and why does it vary (is this something we can change?)
• who works here, what is their expertise, what time do they spend doing this work
• what are the turnkey systems we already have to create service consistency
• who are your clients, customers and suppliers? how do we make their life easy (or not)?

We typically spend the majority of our time in the first few weeks gathering this kind of information directly from staff, by sitting with them at their desk and watching them work, by interviewing them at their desk or in focus groups, and by comparing what we have seen in other organisations to what happens in yours.

We’ll speak to lots of people. We’ll pay attention to all sorts of things. And then we’ll begin to suggest ways you can get at the low hanging fruit, and ways you can you change the systems of reward and punishment, the forms which feed your admin processes, the ways in which you correct errors, the way you train your staff, or anything else we find which creates a blackhole of wasted time.

Cindy

Tags: methodology, process improvement

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