[The following article appears in The Public Sector Network News, Summer 1994 edition, pages 10 - 12.] CALIFORNIA'S DEPARTMENT OF MOTOR VEHICLES: A COMMITMENT TO QUALITY SERVICE The California Department of Motor Vehicles (DMV) is the state's the most visible public service agency, licensing over 20 million drivers and registering more than 25 million vehicles. Most Californians have had contact with the department at one of the 172 field offices or eight telephone service centers. Providing quality service has been an ongoing commitment of the department. In 1986, DMV began a pioneering effort by implementing the principals of total quality management (TQM). Quality Strategies DMV's mission statement, vision/values, and Strategic Business Plan provide the basic framework for quality improvement activities. Three quality strategies are designed to enhance customer service and operational performance: --Public Entrepreneurship: Given current fiscal climate and the increasing demand for service, governmental agencies are faced with the difficult task of doing more with less. At DMV, the entrepreneurial spirit is a critical element of the department's Strategic Business Plan. The development of cost-effective alternative service delivery options for the public (e.g., mail, telephone, automated tellers or kiosks) and the establishment of mutually beneficial public-private partnerships are two examples of DMV's efforts to enhance customer service and control cost. --Advanced Technology: Information technology is vital in today's business world. At DMV, emphasis is placed on information technology as a mechanism for customer service enhancements and cost reduction. Examples of DMV technology applications include: (a) digitized driver's licenses and biometrics, (b) automated tellers or kiosks for self-processing of vehicle registration, (c) interactive voice response (IVR) systems for expanded telephone service, (d) document imaging for reduction of paper files and high speed data processing and retrieval, and (e) credit cards and electronic fund transfers (EFT's) for payment of fees, etc. --Total Quality Management (TQM):TQM provides core operating philosophy for DMV employees. Quality principles, tools, and techniques provide employees with the necessary framework for meeting and exceeding customer expectations by doing the right things right the first time. Conceptual Model for Implementing TQM DMV's model for implementing TQM has three primary components: (a) executive leadership, (b) actions by line management, and (c) bottom-line results. --Driving Force - Executive Leadership: Executive leadership is vital for initiating and sustaining quality progress. At DMV, executive management has initiated a number of strategies designed to promote and support quality: (a) creating a TQM Advisor and a TQM Council to provide a quality support structure, (b) providing quality education and training, and (c) incorporating and deploying quality concepts in departmental planning. --Execution - Quality Actions: For quality to happen, line management must apply quality principles, tools, and techniques in its daily operations. The key quality elements include: - A Focus on the Customer: Obtaining customer feedback (both external and internal) is essential for determining customer satisfaction with DMV service. Customer feedback is obtained by use of surveys, interviews, and focus groups. For TQM projects, customer surveys and interviews are standard protocol for obtaining customer feedback. For assessing overall DMV performance, independent consultant surveys and DMV's Customer Survey Program are the primary methods used to monitor departmental performance. - Performance Measurement: Two primary measurement categories are used to assess performance: customer satisfaction measures obtained from customer feedback, and internal measures of operational performance reflecting cycle time, quality, productivity, costs, etc. All methods of service delivery are evaluated, including field office visits, telephone service, and mail service. Response or cycle time is a key measure of operational performance. In the field offices, customer wait times are recorded for all driver's license and vehicle registration waiting lines. In headquarters, the processing time to produce various vehicle registration and driver's license outputs are recorded. All telephone service centers monitor information regarding busy rates, time on hold, talk time, etc. - Application of Process Management Techniques: The application of process management techniques is emphasized to insure that departmental processes are operating effectively and efficiently. Process administrators or owners have been identified for all of DMV's major work processes. At a minimum, process owners are expected to (a) document the process players, activities, processing time, and costs from customer initiation to customer completion; (b) establish effective performance monitoring systems; and (c) continuously evaluate their process for value-added activities and potential reengineering opportunities. - A Focus on Error Prevention: Many studies have shown that the cost of quality (i.e., the cost associated with catching and correcting external and internal errors) can run from 20-40% of total process cost. As a result, the department is critically examining quality costs and focusing on error prevention or "doing it right the first time." Measures pertaining to work quality or quality costs are collected throughout the department and can be categorized as follows: (a) internal errors identified by departmental quality control review, (b) external customer errors missed in the quality review process, and (c) errors or omissions made by customers that result in a second customer contact. All process managers are expected to quantify their cost of quality, and conduct TQM projects in areas identified as high-cost areas. - Employee Involvement and Recognition: The department encourages employee participation in a number of ways. DMV's Employee Suggestion Program provides cash awards for individual employee suggestions. Team participation in quality improvement projects is emphasized and the most frequent, formalized method for obtaining employee participation. Cross-functional work teams are generally used for major department-wide projects, while unit level work teams are used for resolving daily operational issues. Various award programs have been developed by the department to recognize and reward outstanding performance. The department's Employee Recognition Program uses customer feedback from customer survey cards to recognize outstanding performance of front-line customer service employees. Individual and group achievements by headquarters employees are also recognized by the department's Employee of the Month Award and the Outstanding Group Services Award --Results - Departmental Performance: The purpose for initiating quality initiatives is to achieve customer satisfaction and improve operational performance. - Customer Satisfaction: Survey results from DMV's 1993 Customer Survey Program have indicated that the department is meeting the needs and expectations of the large majority of its customers. Where improvement opportunities exist, TQM projects have been initiated to address the most critical public concerns. - Response or Cycle Time: The department's primary program products are the driver's license and identification card, the vehicle ownership certificate, and the vehicle registration certificate and sticker Over the past four years (from FY 1989/90 to FY 92/93), the department has shown continuous improvement in processing time for various vehicle registration transactions. For vehicle ownership certificates, the department's processing time has improved by 43% (from 9.4 days to 5.3 days, excluding mail delivery time). while processing time for vehicle registration certificates and stickers has improved by 35%. For driver's licenses and identification cards, past comparisons cannot be made because of the recent implementation of the new magnetic stripe driver's license and identification card. - Quality Improvement Projects: The department has conducted a large number of quality improvement projects. In particular, the establishment of mutually beneficial public-private partnerships has led to significant improvements in customer service and operational performance by dramatically altering or reengineering traditional DMV work processes. The Rental Car Pilot Project is one example of how DMV has reengineered the process for registering new vehicles for rental car agencies. The partnership project was initiated in response to a need by rental car agencies to register their new vehicles as quickly as possible in order to maximize rental revenues. Under the previous process, rental car agencies submitted their new vehicle registration documents to DMV. DMV personnel would key the vehicle registration information into the department's data base, collect the required registration fees, and provide appropriate registration certificates, license plates, and stickers. Generally, the process took three to five days to complete. Under the reengineered process, rental car agencies are provided with direct electronic access to the department's data base. As a result, the participating rental car agencies are able to (a) key in their own new vehicle registration transactions, (b) transmit payment to DMV by electronic fund transfer (EFT), and (c) issue their own inventory of license plates, stickers, etc. Processing time has improved from three to five days to immediate turnaround. Projected savings for one participating company is estimated at around $1.7 million in vehicle downtime. The department will also be gaining additional interest earnings due to faster payment using electronic fund transfer. Additionally, the department will save two PY's annually (or $46,230) by not having to key in the new vehicle transactions. These benefits are expected to increase as other rental car companies enter into the new business partnership. Similar examples of business partnerships have been established with the private sector including: (a) providing lien holders (financial institution ) with the ability to obtain an electronic record rather than a hard copy record of vehicle ownership; (b) allowing automobile clubs the capability to provide various vehicle registration services to members; (c) enabling frequent users of DMV business to submit fee payment using electronic fund transfers or EFT's; and (d) providing rental car agencies limited online access to DMV's driver's license data base to verify customer information on driver's license status and driving record. A number of public sector partnerships have also been established including (a) authorizing court-appointed vendors the ability to directly update court abstracts via on-line capability, (b) (to approved central data transmission sites for local government requesting on-line access to DMV information, and (c) providing DMV services at the courts and court services at DMV. A number of TQM projects have been conducted to resolve various customer-related process problems. The Client Refund Project is one example of a TQM project that was initiated in response to customer and departmental concerns regarding lengthy delays in processing a customer refund. As a result of the study, the number of days to process a customer refund was reduced from 77 to 26 days (a 66% improvement). Much Accomplished, Much to Do The department has made considerable progress on its quality journey, but much still remains to be done. During early 1994, the department will conduct another comprehensive consultant survey to reassess the public's perception of DMV service and plan for future customer service enhancement strategies. Additional efforts will be directed at identifying and reducing quality costs, and re-examining key DMV processes for value analysis and reengineering opportunities. Executive management will continue its efforts to develop additional strategies to further enhance quality deployment throughout the organization, with emphasis on increasing employee participation, employee empowerment, and teamwork. A DMV Quality Award Program (similar to the Baldrige Award) will be developed to encourage, formally recognize, and reward quality progress. These and other planned efforts are part of the department's ongoing commitment to transform DMV into a quality service organization. For more information, please contact: Richard Harano Department of Motor Vehicles 2415 - 1st Avenue (F-258) Sacramento, CA 95815 Phone: (916) 657-7231 Fax: (916) 657-6851 [To join the Public Sector Network, call ASQC (800-248-1946). There is no charge.]