Bloomberg Government Insider

Iowa's Lone Efficiency Ranger


Iowa's Lone Efficiency Ranger

Photograph by Monty Rakusen/Getty Images

Iowa’s Office of Lean Enterprise wants agencies to act more like well-engineered assembly lines. For nearly a decade the state has used outside advisers and now its own team to measure, track, and sometimes entirely overhaul the way departments do business.

Lean, a management theory popularized by Toyota Motor (TM), focuses on kaizen, or, loosely translated, “change for the human good.” The idea is to first map all of the steps, stops, time, and personnel involved in making a product or executing a process, then rethink how it could be done more efficiently. In white-collar offices that’s hard because many of the steps are invisible. Still, a 2010 kaizen at the Iowa Department of Transportation resulted in a 46 percent reduction in the number of steps it took to issue a temporary restricted license, dropping the backlog of people awaiting them from 600 to about 100, and response time from 30 days to just five. “It’s a continuous improvement mind-set, and one of the things that you have to be doing is constantly reassessing,” says Mike Rohlf, the administrator of the Iowa office.

That reassessment push started in 2003, after a consortium of businesses asked Iowa to speed up the process for awarding air-quality permits. The state hired an efficiency improvement firm called TBM Consulting Group, whose staffers were trained by former executives at Toyota. TBM ran an audit and figured out how to drop the issuance time from 62 days to just six. (It now averages about 40 because of reductions in staff.)

In 2007, Iowa hired Rohlf, a black belt in Six Sigma, a different method used by manufacturers such as General Electric (GE) to improve work flow and cut down on defects. The state then footed the bill for TBM to train him so it could bring the work in-house. Fittingly, Rohlf now has an office staff of just one person—himself, on a $78,000 salary—and no operating budget. His basic tools: a big wall and lots of Post-it notes.

For each kaizen, Rohlf asks for a dozen volunteers—employees or managers from different areas within the agency in question, as well as independents from an unrelated department. Everyone tracks how the work flow is actually progressing. Then they map out how it could theoretically work better and make adjustments to improve speed and execution. The state has done 180 such events, and Rohlf generally picks the sharpest group members to run future sessions.

Iowa doesn’t keep a tally of total hours or dollars saved as a result of these efforts because many tweaks result in “soft” savings such as speedier service. Still, last year’s overhaul of the vocational rehabilitation office that assists with Social Security reimbursements is on pace to net about 20 percent more federal reimbursement money, or roughly $100,000 annually. One key fix: switching from a paper to an electronic claims process.

Paynter is a Bloomberg Businessweek contributor.

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