Water

Often, the management of a water utility already has a good understanding of its utility’s condition and the level of performance it provides. Too, it is often difficult for a utility to know how to begin an improvement program and what priorities should be set.

Continuous Improvement (CI) as a methodology provides the structured format and direction desired by management wishing to improve their utility. Useful tools to introduce CI to the water utility management team are

• Executive Guide to CI, provides an overview of the CI process and sets out the roles and responsibilities of different stakeholders, and
• Nonrevenue water (NRW) Self-Assessment Matrix, NRW being a key improvement area for many utilities

With sufficient understanding of CI and how it can benefit the utility, senior management may commit to a CI program and make a public disclosure of their intent to implement CI.

View sample presentation and commitment to CI

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CI focuses upon a service, not an organizational unit. Services are delivered by business units within a business structure. Because a single service may be delivered to the customer by many organizational units, it is important for the utility to view its operations in service terms, rather than its organizational structure.

It helps CI enormously if the utility has a comprehensive list of services it delivers and the linkage to the various organizational units that contribute to their delivery. Process classification can be used as a framework to define services.

View sample utility service structure and service structure characteristics
View Process Classification Framework

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Continuous improvement of a service is mostly done by a CI team with knowledge and responsibilities for that service. Because the utility has limited capacity to organize and resource CI projects and implement change, it is essential to prioritize services for improvement.

Priority setting can be based upon whether or not the service directly impacts the customer, the current level of performance, the current level of complaints, the complexity of the service and whether or not the service is a key contributor to NRW.

Once a priority list of services is developed, the service can then be nominated as a CI project. The nomination paper scopes out the service and sets targets for improvement. The nomination is then considered and approved by management. This is the beginning of a CI project.

View sample CI project nominations

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The CI project should be scoped at a level that enables the project to be completed up to the recommendations point, within three months. If the required period is longer, then the scope of work is too much and there will be a risk of the project losing momentum, floundering and then failing.

The CI coordinator, senior management or the service manager must plan the CI project, and issue the plan to the stakeholders. The progress of the CI project must be monitored against the plan, and any barriers to progress must be addressed.

For the initial CI project, a small steering committee may be created to scope the project, select the CI team and monitor progress. As the CI method becomes more widely known then department managers or section leaders can take on this role. In some utilities, they appoint a CI coordinator whose responsibility is to organize, coordinate and manage all CI projects within the utility.

View sample CI project plan

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Once the service has been nominated for a CI project and the plan has been developed, it is time to form the CI team and train the team members.

A typical CI project team has three to five members. It should have adequate representation from the service provider and may also have representation from finance, human resources, customer service, information technology, etc. The team should not be made up exclusively from the service provider unit. Once the team members are selected, their appointment to the team should be formalized by management using an engagement notice.

In some contexts, it is also appropriate to gain government support. This is particularly so where the government has control of funding or has a regulatory function. Ideally the government should participate in the CI project to a degree.

There are three different approaches to this step that can be applied individually or as a combination of all three:

• Train the team members thoroughly in the CI techniques using a classroom environment and a CI facilitator, and then leave the team members to apply their knowledge and deliver the CI project;
• Facilitate the team members to use the CIB toolkit that has voice narrations, and then leave the team members to apply their knowledge and deliver the CI project; and
• Set the CI team weekly assignments (or fortnightly assignments) that suits their capacity to undertake the CI work, and facilitate their work using a CI facilitator.

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The first task for the CI team is to define the service they are improving, using the service definition template in the team workbook.

The service definition seeks to clarify all of the components of the service plus any known problems with the delivery of outputs or the attainment of outcomes.

A number of service definition examples are available, showing the format of the service definition template and also the level of detail required.

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Once the team has a good understanding of the service definition, including the major processes, the team can then process map the whole service, or a particular process step.

In some cases the service scope is too much for a single process map; for example the Customer service process may include:

• Receiving complaints
• Receipting payments
• Adjusting accounts
• Receiving applications for new connections
• Receiving notification of a closed connection
• Receiving notification of changes to customer details
• Answering enquiries

The CI project scope will likely chose only one or two of the processes within Customer service, but in some cases may chose to improve all of them.

The process map focuses upon a service or service process, and then maps the process steps in sequence using “swim lanes” to illustrate the separation of the individual organizational units contributing to the process.
It can be drawn manually or by using computer software.

Once the team has mapped the service process, it is then time to review the process and look for improvement opportunities. Opportunities revealed include:

• Too many hand off points and too many different units involved – option to delegate responsibility and authority to reduce the number of hand over points
• Too many manual redundant tasks, such as data entry of data that already exists – option to enhance the application software to eliminate redundant data entry; and
• Customer does not prepare data in sufficient detail, or source transaction does not have complete data – option to educate the customer to prepare data more completely, or change the content of the transaction form thus reducing data entry by the utility.

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Performance of the service is measured using the approach set out in the training materials. Performance measures are defined for the key inputs, outputs and outcomes of the service. For the key inputs and outputs, the performance aspects are:

• Unit cost
• Quality
• Timeliness
• Customer satisfaction
• Access

Performance data is collected from the transactions flowing through the service and can be logged into a spreadsheet that then calculates the performance metric, which can also be shows in graphical form. The graphs facilitate the illustration of performance trends.

Some example spreadsheets that show how the base data is captured, calculations are performed, and performance shown in graphical format are:

• Pilferage
• Sewerage blockage removal

Different reporting formats are also used including a simple graph report or a more comprehensive quadrant report that includes the graph of performance, analysis of the components of the performance, a why-why cause of performance and planned actions.

In the first instance, the performance metrics inform the CI team about current performance, and this enables the team to focus upon specific failures. As improvements are implemented then the service manager will monitor ongoing performance to ensure immediate improvements are obtained and then sustained.

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The CI team by this stage will have some indications as to where problems are or where performance is poor. To overcome problems or to improve performance the team undertakes a causal analysis to see what the root cause of the problem or poor performance is so that remedial action or improvements can be targeted at the root cause.

Two tools are used for this analysis:

• Fish bone diagram
• Why-why diagram

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There are a number Benchmarking approaches that are more fully described in the CIB Toolkit. For more recent CI projects, two Benchmarking techniques were used:

• Accessing publicly available performance standards and results;
• Making field visits to water utilities to see how their processes are conducted (see photo gallery)

In addition to the two Benchmarking approaches used above, the CI facilitator also researched best practice for specific services.

With Benchmarking knowledge, the CI team is now in a good position to develop innovative improvement recommendations to management.

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Improvements can be categorized into two forms:

• Strategic or transformational
• Incremental

In one example the utility had a dispersed service where individual sites did not have economy of scale to support the required technology and plant and equipment to provide the service sought. This was a strategic weakness and a strategic recommendation to consolidate some services and outsource others was made. See Service strategic positioning and Service strategic positioning 2.

Incremental recommendations assume the service structure remains constant and changes are made to individual processes, systems, resources or equipment to make the service more responsive, more efficient or more accessible. These incremental improvements are illustrated in Leak detection recommendations and Recommendations.

Once the recommendations have been considered and accepted by management, it is time for their implementation.

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Implementation strategies are more fully described in the CIB Toolkit, but essentially the options revolve around whether or not to implement the change in part across the whole organization, or implement the change in full in part of the organization with a planned role out strategy for each approach. The number of employees affected the role out of application systems and wide area networks, affordability and the customer’s ability to absorb change will all have a bearing on the implementation approach.

As a general rule implementing change involves the following steps:

• Preparing Standard Operating Procedures that describe the new process
• Establishing a test or training system where IT is used
• Training employees on how to conduct the new process
• Promoting the change and educating the customers on how they are to conduct the new process
• Prepare all the tools, data, information, forms etc for the new process
• Commence the new process at a cut over date
• Quality control the new process
• Monitor service performance to ensure performance improves and is sustained

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As the changes are more fully implemented the utility should see a visible change in the performance results. They may not all improve immediately, and timeliness and customer satisfaction may decline in the short term as the new process beds down. After a settling down period, performance should improve and be measurable.

It is important at this stage for the service owner to monitor performance results and search for an upward trend in all performance aspects, being cost, timeliness, quality, customer satisfaction and access. A simple graph report may suffice or a more comprehensive quadrant report may be desired by management.  Improvement in outcomes will come a little later and may be more difficult to measure.

Some standards are very dynamic and must be managed on an hour by hour basis and this is shown in the on-line interactive monitoring of specific standards and performance in monitoring KPIs and monitoring KPIs 2.

Sustaining the improvements is the next key focus for the service owner; performance must be monitored continuously so the improvements are sustained into the future.

The Customer charter will also include update service standards for which all customers will have an expectation of receiving. It is common practice to report the actual achievement level of complying with these standards back to the stakeholders including customers; this is illustrated in KPIs reported to customers.