Operational optimization: A lean six sigma approach to sustainability

With the publication of the Effective Utility Management Primer for Water and Wastewater Utilities in 2008, water industry organizations were provided with a step-by-step process to assess the management of their operations and infrastructure and chart a course for improvement and performance measurement based on EUM Attribute priorities. In October 2012, the EPA published the Resource Guide to Effective Utility Management and Lean, which focuses on efficiency improvement, reduction of waste, and the promotion of sustainability throughout utility operations. These two publications provide both what water utilities should prioritize for improvement and how to work towards improvement in those prioritized areas.Water and wastewater service providers in the United States have utilized EUM and are starting to incorporate Lean techniques to focus on operational optimization by targeting the root causes of inefficiencies and waste to design and implement sustainable improvements in maintenance, business processes and logistics, indirect cost reduction, energy and materials, and procurement and supply chain management. Cost saving implementation has ranged from simple process redesign to more complex information system implementation and/or integration.Although organizations within our industry have done much to improve their overall efficiency and effectiveness, there is also a recognition that there is more to do to move further along the improvement continuum. This presentation will discuss the Lean Six Sigma approach employed by several utilities to ensure that the management, operations, and maintenance of their water, wastewater, and stormwater enterprises are being performed in a highly efficient manner, and will identify improvements and efficiencies gained from the effort.Specific activities that will be discussed in detail include:Formalizing a Project Charter to document program objectives, coordination, stakeholders, communications, assumptions and constraints, and performance metrics.Performing a comprehensive diagnostic evaluation and document review to establish a baseline of current performance and further quantify efficiency opportunities.Interviewing stakeholders to better understand the current organizational strategies and issues.Conducting “Day In the Life Of” observations to analyze optimization opportunities and measure the effectiveness and value-added components of individual process steps.As-Is process documentation to depict the flow of data, materials, and deliverables.Developing a Responsibilities Matrix and Human Performance System to identify specific people responsible for each process step.Conducting Cause and Effect Analyses to identify potential root causes for each optimization opportunity.Conducting “Solutioning” Workshops to validate individual improvement ideas.Formalizing and quantifying opportunities and benefits.The organizational improvement efforts discussed in this presentation have resulted in excellent system reliability, regulatory performance, and financial stability for several utilities, and have provided a more focused effort at taking the next large improvement step to ensure that a performance management and continuous improvement culture and strategy are in place to foster operational optimization and financial and infrastructure sustainability well into the future.