Article 75. Savings From Lawrence Rosier VA Reforms

The rejected Proposal to make the VA more effective and efficient through my General Reform Model was estimated to save more than $5 billion.

The savings from the Lawrence Rosier Approach to the VA comes as a result of implementations of my Government Reform Model which is based on Enterprise Lean. Lean provides a vehicle for generating dollar savings and quality improvement over time through the continuous improvement of the processes and services delivered. These savings deliver real value in reduced expenditure and in better service to Veterans but are difficult to put a dollar amount on.

The main area for immediate savings comes from the General Reform Model using the data from the Enterprise Lean Team studies to do Work Measurement where the work performed by each Function’s processes are measured and documented.  The process continues with the employee Functional Lean Team putting their processes together so that the work load is balanced (meaning no employee must wait on another employee to do his job).  The result is the known number of hours required to do each Function which also determines the staffing required.  Note that a balanced work load depends upon a team effort working together, each member doing his assigned part.  Wasted time of employees waiting on other employees to do their jobs is a big reason for waste in government. 

The General Reform Model as proposed to the Secretary of Veteran’s Affairs is in two parts the first part focusing on the problem of identifying the number of increased staff required to quickly meet patient appointment schedules in all VA Medical Facilities.  By presenting a balanced work load plan for each medical area showing their work assignments and exactly how many staff members and their skills are needed to form a team that meets the required patient appointment schedule.  Note that just adding another Doctor to the staff would probably result in wasted time without adding the nursing support needed by the doctor.  Savings from this activity because of the large impact on all VA facilities is estimated to be more than $3 billion.

Implementation of the second part of the General Reform Model which completes the implementation in the Temple Texas VA facility in the remaining portion the enterprise.  It continues the process begun in the first part but in non-critical medical areas.  This part implements right-sizing and work load balancing in all remaining functions.  The result is the identification of where over staffing is occurring with retraining and reassignment of employees to areas where they are needed.  The savings in the development Facility is estimated to be more than $10 million and in all VA Facilities more than $1 billion.

A major benefit of this approach is that a new positive culture results focusing the Functional Lean Teams on their work processes replacing the toxic old culture.

The General Reform Model ends with the implementation of Team Management replacing the current Bureaucratic organization.  This is more of a formal declaration since the Temple Texas VA Medical Facility is already organized around functional Lean Teams and existing Doctor’s Teams.  The process creates self organized Functional Teams which elect their on leader by secret ballot eliminating all bottom level supervisory positions.  Each supervisor will become a member of the Functional Team.  Other higher level Teams will eliminate some management positions.  All redundant Supervisors will have the opportunity to reapply for management positions in the new medical facilities that the VA will be building.  The savings from the change to Team Management is estimated to be more than $10 million at the Temple Texas VA Facility.  When implemented throughout all VA facilities the savings could be more than $1 billion.

Savings From Over staffing
All Bureaucracies are wasteful when it comes to over staffing many government positions are designed to fill a box on an organization chart without any thought to the amount of work required to do the job the result is that what appears to be a full time job may only require half of the employee’s time.  Over staffing in the private sector has been verified by data from Alexander Proud foot (the leading downsizing consulting firm) implementations which found that from 17% to 20% over staffing occurs in private companies.  Government  over staffing may be significantly higher than 20%.

Total Savings
Total savings from the implementation the General Reform Model in all VA Facilities is expected exceed $5 billion.

ROI
Enough about savings equally important is the Return On Investment.  The implementation of the General Reform model is largely done by the VA’s own resources: Ten OIG Analysts acting as facilitators for Functional Lean Teams meeting for one hour per week.  My estimate for an ROI for the current Consulting Agreement For determining staffing for all VA facilities and the  General reform implementation at the Development Facility is about $3,000 return for each $1 invested. The ROI for implementation of the General Reform Model for all VA facilities is about $5,000 for each $1 invested.




Note on Government Lean Studies
Government Lean Studies which focus on a single process do not return much of the savings they purport to save because even though they can show a significant savings.  The process is done with out considering the process done before and after the studied process. The main problem is that these implementations are aimed at the trees in a forest of waste which is occurring all around them But there is a second problem much of the savings is never realized because bureaucracies are reluctant to reduce the staffing identified by the Lean implementations. Enterprise Lean avoids this problem by evaluating all the functions in an entire enterprise.

Lean Six Sigma
Lean Six Sigma focuses on an entire system rater than individual Lean studies avoiding the problem  found in individual lean studies by balancing all the processes in the entire system.  Enterprise lean is complementary to Lean Six Sigma because it is focused on making the sub-systems efficient which flow into the high level Lean Six Sigma system.