Investing in Human Capital: The Littleton/Englewood Wastewater Treatment Plant Knowledge Management Initiative

When thinking about capital the assets of an organization, what are the first things that come to mind? Pumps, blowers, buildings, pipes? Indeed, these are all capital items. However, studying a pie chart of organizational expenditures can paint a different picture. Capital investment is not the highest organizational cost, in fact it may be the smallest piece of the pie. The largest piece of the organizational expenditure pie is typically personnel costs.When an organization hires an employee, it is actually purchasing non-tangible capital: knowledge, skills and abilities. And just like a capital purchase, there is an upfront cost to recruit, hire, and train, and an on-going cost to retain, maintain and develop. But what happens when an employee retires or leaves the organization? What happens to the knowledge and skills the organization has invested time and money to develop? What's the replacement schedule for that asset? What happens to the investment? What is the impact on the organization and it operation? Is there redundancy? This non-tangible capital, if not maintained and properly planned, can become an organizational nightmare.The Littleton/Englewood Wastewater Treatment Plant (L/E WWTP) has a Long Range Master plan which addresses plant/treatment expansion through ultimate build-out. This plan details the ‘how’s' and ‘whys’ of plant process and infrastructure, and the capital investment required to meet treatment demands through the year 2020. In 2004, the plant embarked upon its Phase 2 construction project, which will nearly complete the build-out of the Long Range Master plan, leaving plant staff with an entirely new facility to operate.While the Long Range Master Plan has been an invaluable capital plan, it does not address the issues of ‘who’ will operate and maintain the facility. Additionally, the plant faces the potential of losing 25% of its workforce over the next 7 years due to retirement. The knowledge and experience of these staff members is a vital asset to the plant because they are the only personnel who understand certain processes and equipment and have gained the knowledge of new equipment and processes as the Phase 2 project has proceeded. Plant management recognized a need to develop an action plan to address their ‘non-tangible capital’ for long-term success. An initiative has been developed to address knowledge exodus, succession planning by developing a Knowledge Management Plan, a Career Development and Performance Programs, and tied these programs together with a Pay-For-Performance Program.The Littleton/Englewood Wastewater Treatment Plant (L/E WWTP) is the third largest wastewater treatment facility in Colorado, serving a population of 300,000 residents in the cities of Englewood and Littleton, and 21 sanitation districts in the southwest Denver metro area. The plant faces many challenges in the future and has begun several significant initiatives to position itself positively for successful operation after completion of the Phase 2 Project and well into the future.The major challenges facing the plant are:The Phase 2 Project: This major construction project addresses infrastructure improvements, capacity expansion needs, and adds a new process; denitrification. When the project is complete in 2008, staff will have to be prepared to operate a new plant with new equipment. This requires development of all new Standard Operating Procedures (SOPs).Regulations: Faced with increasingly stringent regulatory responsibility, advancing treatment technology, plant staff needs to be well trained and continuously up-to-date on treatment and technology that supports successful operation and meets the regulatory requirements.Workforce Retirement Eligibility: Approximately 25% of the plant workforce will be eligible for retirement in the next 5 – 10 years. There will be a significant knowledge loss, particularly in the Operations Division. Therefore, it is critical over the next few years to capture this knowledge and store it in an accessible format.A four part program has been developed to address performance management, career development, succession planning, and knowledge management, and develop a strong pay-for-performance program to support these initiatives. This paper will focus on the L/E WWTP plan to capture the knowledge of its workforce, develop Standard Operating Procedures and on-going training programs to ensure knowledge transfer and long-term operational success. This paper will also preview how the information is being developed and managed in a living, tangible form and the incentive program that supports this effort. Finally, the program will be tied together in a package that supports the organization and its most valuable capital: its employees.