The following is the text of the Federal Lands Highway Quality News, Vol. VI, Issue 1, Winter 1995. Call Mark Chatfield, HFL-1, (202) 366-9492 with your questions or comments. FLH Quality Improves for Sixth Year The theme of this issue of the FLH Quality News is "Lessons Learned." The very first thing FLH's top officials learned in trying to implement change was to get outside their own organization in order to expand their thinking. The second thing they learned was to measure progress over a significant period of time so FLH can demonstrate whether changes are having an impact. In 1989, FLH began measuring its overall orientation to quality using an assessment developed by the Federal Quality Institute (FQI). According to the FQI, an agency that can achieve a rating between 600 and 800 on their 1,000 point quality assessment scale has "a well developed, systematic quality management approach with excellent functional integration that has been implemented in most parts of the organization." James Weathersbee, Executive Director for Corporate Operations of the Naval Air Systems Command which won the 1994 Presidential Award for Quality says they scored 600 on their internal assessment this past summer. The FQI's December 1993 Self-Assessment Guide provided the methodology for this year's continuation of the FLH Quality Improvement Prototype (QIP) review. With consultant assistance from Dr. Al Gunneson of The Gunneson Group, the Quality Coordination Team conducted the November 1994 FLH review as a "peer" review with a couple of interesting wrinkles. In past years, the Quality Coordination Team (QCT) got together, sometimes with a selected group of managers, to come up with the annual assessment. The QIP assessment has tracked the overall quality efforts in FLH since 1989. With new team members and a new guide from FQI, our primary coach (Tom Edick, Program Administrator) encouraged the team to get consultant help. In addition, the team decided to administer a questionnaire and then visit each FLH Division to review the responses and validate them by conducting selected interviews with employees, managers, and supervisors. A formal report is being written by The Gunneson Group to be available in early 1995 in time to use the information to help direct the next FLH Strategic Business Plan. The bottom line is this -- FLH has improved every year for 6 years with a 1994 increase that represents a breakout from 3 years with little progress. The 1994 score, using the FQI's scoring system, is about 630 out of a total possible 1,000. Just averaging the scores without weighting one more than another, shows 62 percent -- up significantly from last year's 53 percent. Turning Loose By Mark M. Chatfield, PE A friend recently told me about the monkey trap. Monkeys are one of the most intelligent animals in the world. My first thought was, "It must be terribly difficult or inhumane to trap a monkey." I could imagine a smaller version of a bear trap snapping shut on some poor monkey's leg causing excruciating pain and a slow death. At least that was my assumption. Then my friend explained. Natives make a small cage about six inches high of strong green twigs tied together with vines. The twigs are spaced just far enough apart for a monkey to reach into the cage. The cage is then secured by a rope so it cannot be taken away. Inside the cage is placed a small hard fruit about the size of a golf ball. Since it is the monkey's favorite food, it will reach through the bars of the cage to grasp it. That's all there is to it. The monkey is trapped. You see, once it makes a fist around the fruit, the monkey refuses to turn loose even when the hunters approach for the capture. My friend calls this tendency to hang on no matter what, the Monkey Trap Syndrome (MTS). You and I have had MTS at one time or another. You probably know people today at work who suffer from it. No matter how much evidence to the contrary, we just tend to hang on to ideas we have always had. Regardless of the damage it is causing to ourselves and others, sometimes we will not turn loose of our control. Eventually, we may even become angry, or bitter. In extreme cases we might become disgruntled and retire, often while still on the payroll. Two questions come to mind: (1) What can be done to prevent MTS? and, (2) How can you live with someone else who has it? Preventing MTS First, let's not denigrate the idea of control, per se. Control is a valuable trait for each of us. People need to have self-control and to control their environs. Police must control violence. Every office must control its budget. The problem comes when I try to control something over which I do not have complete jurisdiction. In other words, if it doesn't belong to me alone, I should not be the sole controller. The workplace is a complicated ecosystem. There are some things over which I have complete jurisdiction. Most of my efforts at work, however, are influenced or partially controlled by others. There are almost no unilateral decision opportunities if those influenced by the decision are to have a say. As we grow in teamwork, our ability to control everything is under constant pressure. So, to prevent MTS, we need to: Be aware that the trap is there. Consider the issue of control every time we make a decision. Who has a stake in this? What customers need to be served? Am I trying to control this for my own short-term purpose or for the long-term good of the organization? Keep in mind that our personal best may be entirely "right," but unless everyone who is affected has a real opportunity to contribute to the decision, the correct decision in terms of overall outcome may be one which is not completely "right." How to work with someone with a bad case of MTS Be assertive without being discourteous or unpleasant -- the victim needs to know his or her actions and words and decisions should show full respect and consideration of others, in spite of the anger and frustration that might be vented. Keep reminding the person that it is the long term that is important; consider the long-term impact of insisting on your own way versus that of the team. Be patient. Often, the most experienced, expert, and intelligent people get trapped by their own genius. Everyone on the team needs to work hard to suppress their own frustration. Try to keep calm. Show the controller that you will not get riled up (lose control of yourself) but you will persist in seeking widespread agreement. Total Employee Involvement (TEI) Conference By Jim Hall, Western Division Engineer The TEI conference was excellent. I only wish that all of our Division Quality Council (DQC) could have attended -- it was that good. There were three concurrent sessions much of the time so I could not cover all of the sessions. Here are the impressions I got from the conference: General Comments: Quality is a mindset -- It is either everywhere or nowhere. Employees usually know their organization can improve while management thinks things are okay. Meaningful employee involvement has a more powerful effect on morale and productivity than employee empowerment. The extent to which employees have been empowered can be determined by their ability to answer questions about the business. We want to educate people, not train them. In training, people learn to repeat something they are shown. Educated people understand why they are doing something and can improvise or take an entirely new approach. These educated employees can find the breakthroughs that are necessary for an organization to excel. 360-degree performance appraisals are used by some organizations and are highly recommended. In this approach, ratings are prepared above, below, and at the peer level. Each rating is part of a final rating. This type of rating covers the three following areas: Business Objectives Values Career Development About Vision, Mission and Values: Significant increases in productivity will occur when an entire organization aligns itself to a common vision, mission, values, and goals . This alignment is essential prior to empowerment of either teams or individuals. A vision statement should not be longer than 20 words. It should be simple, clear, and persuasive. Our values lock in the emotional issues for the organization. About Leadership and Management: Leaders tell what and why. The teams decide how, when, and where. Coaching takes more time than managing. Leaders must get themselves in line with the business issues before asking the employees to take the this step. Also, the leadership team must monitor the business objective for continuous improvement if it expects its teams to monitor their accomplishments and make continuous improvements. Leaders should start doing things, not announcing things, or people will perceive new efforts as the flavor of the month. In a continuum where one end represents authoritarian style leadership and the other end represents a thinking style, leaders need to find a balance because neither end is appropriate. The authoritarian end is where top management has a business focus, supervisors set goals, disinterested employees focus on their own goals and perform the work in a robotic manner. The thinking end is where teams are voluntary, chaos reigns, and there is no business focus. It is the leader's job to terminate an employee - This should never be turned over to teams. Leaders should conduct round table meetings arranged as follows: @BULLET2 = Eight or fewer employees, @BULLET2 = Find out what is going right/wrong/needs to be changed, @BULLET2 = One hour or less, @BULLET2 = At least 3 per year for every manager, @BULLET2 = Personnel assigns employees to a supervisor on request, usually alphabetically. Many managers are uncomfortable with the concept of permitting mistakes in the interest of learning. For some reason, these managers think they must "save the organization" each day. This justifies their actions including the disapproval of someone else's ideas which takes the energy out of the organization. This is a major reason for taking as many managers as possible out of the approval/supervisory role. Freed up managers/supervisors should be given a value added goal such as: working with customers, helping establish business goals, coaching, facilitating, assisting on peak/high priority projects, establishing targets and policies, refining team guidelines, removing barriers, providing training, becoming technical experts, participating in the leadership team, and attending training. Anna Versteeg says, "You know something's real when actions equal words." Ten questions top managers should be able to answer [modified for application in Federal Lands Highway]: What is the annual obligation target for this fiscal year? What is your top customer service issue? What are your top two quality defects going out, arriving, and in the hands of external customers right now -- by Pareto analysis -- the highest volume of repeatable quality defects? What are the next two new products or services being developed? Was your office above or below budget last month? What was your current production or service efficiency as of last month? What is your highest cost product or service to produce? Why is it your highest cost product or service, is it a materials, labor, or overhead issue? What is the definition of overhead? What is your average equipment up time as of the month before? About top home-based teams (defined as the boss and his or her direct reports) This is the team that leads the division or organization. It needs to monitor the progress in attaining business goals if it expects other teams to monitor the business goals in its area. Team members should meet frequently for periods of 30 to 60 minutes and work to get the entire organization monitoring their share of the business goals. The team should not monitor the goals of other teams -- only its own. Each manager on the top home-based team should be expected to meet annually with three groups of employees (not all of their own reports) to ask what the organization and management is doing that is not consistent with the organization's vision and values. The team should keep employees informed about business results. About teams (Home-based, Self-directed, focus area, etc.): The major benefit of teams is increased ownership and buy-in. We should not use the term self-directed. This type of team can be called many things but the preferred term is "Mission-Based Team" because it receives most of its direction from the vision, mission, values, and goals. Every team should have certain "non-negotiable" features, such as total budget, that are set by management. This should include a list of standard rules and mandatory rules. Regular team meetings are for information sharing and not for problem solving. All team members must know the vision, mission, values, and goals before they are empowered. Team members should be trained in business areas, team processes, and interpersonal skills. A good management information system, including good visual aids the entire organization can see and understand, is needed to keep self-managed teams in alignment with the organizations goals and progress. Teams should be run by process, not by personality. This means that they need team guidelines, decision processes, etc. Supervisors should stay in place during the transition period. Corrective action is the last thing to be turned over to teams. Management should implement teams for one reason and one reason only -- to improve the bottom line. Participation in teams should not be voluntary. While there may be times that voluntary teams are appropriate, for business goals, participation should be mandatory. In any organization, some employees will not participate in team activities. If the employee persistently refuses to help, he or she should be disciplined or terminated - not reassigned. Teams should focus on business goals using team processes and not on themselves or how to make themselves a happy team. They should focus on what will make the team more productive, not more enjoyable. Some of the processes that need to be in place for successful mission-based self-directed teams: Performance evaluation (preferably "360-degree" evaluations where all those with whom an employee works -- above, below, and along side -- have a part in the evaluation), Definition of teams, Definition of team leaders, Business Objectives, Values, Team processes, Standard Operating Procedures, Communication Process -- Vertical and Horizontal, Ten-question alignment with business objectives, Consistency in non-negotiation processes, Pilot team process, Definition of "barrier" and barrier analysis and, Example-setting leadership. Some of the non-negotiable items that all teams require: The organization's business objectives Vision, mission, goals Team procedures, processes, roles Meeting frequency Teams should assume responsibility in the following order: Work schedules Interviews/hiring Reducing scrap/rework Efficiency Cost/unit Quality Performance reviews Customer complaints Customer surveys Customer letters Corrective actions (Team's employees) About Organizations: The difference between reforming the organization and transforming the organization is that reforming moves the boxes; transforming remakes the organization. Organizations have historically been based on a "paternalistic" model with all of the inherent advantages and disadvantages of this model. All employees should be treated as peers. Some companies use terms like "colleague," "associate," "partners," and "members" to foster this philosophy. Vendors (Contractors) are an extension of the company and should be treated as such. The organization of the future may have a pyramid that descends as follows: Customers Workplace models/processes Management/union partnership councils* Constructive relationship council Human resources board They write the ideal future vision and the steps to get there (Strategic Business Plan). Organization changes should follow -- not lead -- the transition to self-managed teams. It is not necessary and maybe not even desirable to change the organization structure to go to "self-managed" teams. If organizational goals and team processes are in place, turn the team loose with a charge of managing itself within this context. Some organizations realize that upward mobility is decreasing and they are moving from skill-based pay to developmental-based pay. Under this scenario, pay increases for each rotational assignment employees successfully complete. More General Comments: Between stimulus and response is choice. Nobody makes us do things! The context with which we view the world is mostly unconscious. As such, we are usually not aware of the incorrect data we use to evaluate things around us. This is especially true when trying to remember what you've learned at a management course. New Brochure on FLH Awards and Recognition Employee involvement is an essential quality management principle. Since making the organization-wide commitment to quality, FLH has moved to promote this principle. One of the ways FLH has done this is through an enhanced and varied system of awards and recognition. The new brochure Awards and Recognition, which features a photo of the striking new Federal Lands Highway Award for Quality, is available in each FLH Division. This particular award is the organization's own version of the agency Administrator's award. The Executive Quality Council presents it annually to individuals and teams that embody the highest principles of quality in FLH. They demonstrate exemplary achievements in such areas as customer satisfaction, process improvement, strategic planning, or culture change. Managers and supervisors initiate nominations that are screened by the Division Quality Councils. The DQC's forward the best nominations to the EQC for final selections. While the annual number of FLH Quality Awards is not fixed, it is limited. Other awards and criteria described by the brochure are: Eastern Federal Lands Highway Division's Employee of the Month Award, Western Federal Lands Highway Division's Construction Quality Award Program, Peer Awards in all Divisions, Eastern Federal Lands Highway Division's Certificate of Excellence Award and, The Bridge to Improvement suggestion program awards. Lessons Learned in Piloting GPRA Allen Burden, FLH's Programs and Administration Division Chief and officials of three other Department of Transportation Government Performance and Results Act (GPRA) Pilot Projects, will be giving another briefing/training to share experiences in developing the FY 95 GPRA Performance Plans -- "Lessons Learned". People from other DOT modal administrations will be attending. It is being held January 11, 1995 in the DOT building. Similar briefings have been done in the past in smaller forums. Performance plans are consistent with the first two objectives of the FLH Plan for Implementing Total Quality Management. These are Continuous Improvement and Customer Satisfaction. Under the GPRA Pilot Project, FLH has worked with its primary customers to develop agency-wide performance measures (key indicators) of our work. These high level measures are to be tracked over time to demonstrate overall performance. The lessons FLH has learned in coming up with a performance plan include: Define performance in terms the customers clearly want and understand. Keep down the number of performance measures; five to ten are enough. The top leaders should, themselves, develop the overall performance measures based on their personal understanding of all customer needs. Input from all customer bases should be solicited. This includes internal, external, upward and downward in the organizational hierarchy. Set most target performance measures to show conservative levels of improvement. One or two "stretch" targets are enough for one year. The Last Word Tour: Managing for Quality By Thomas Puto, Central Division Dr. Joe Juran completed his final public appearance on "The Last Word" tour recently and I was fortunate to attend this highly informative session on lessons of a lifetime in Quality Management. At the young age of 89, Dr. Juran is retiring from the public spotlight to devote full time efforts to his family and begin writing his life memoirs. During this all-day interactive session, Dr. Juran related his 70 years of Quality Management experience to the several hundred people attending the seminar. Key topics discussed by Dr. Juran included: Who is the Customer, Benchmarking, Empowerment and Self-directed Teams, Motivation for Quality and Prognosis for Quality in the United States. Sessions were followed by Question and Answer periods where Dr. Juran talked to the conference on an individual level. The son of a Hungarian immigrant, Dr. Juran began his career at Western Electric Company in 1924 and immediately began to make impacts on quality improvements. He advanced rapidly through the ranks of management and left Western Electric in 1942 to assist the U.S. Government during World War II. Dr. Juran provided detailed ideas to the U.S. Government on improved efficiency techniques in moving goods and supplies around the world. After the war, Dr. Juran accepted invitations from the Japanese government to provide lectures and training on improving production rates at Japanese factories. These ideas were quickly implemented by the Japanese government and tremendous quality improvements were achieved in short periods. Dr. Juran warned American business in the mid-1960's that the Japanese were headed "for world quality leadership in quality control" and Dr. Juran began teaching some of these same ideas to American companies shortly thereafter. Dr. Juran has been a world leader in quality management and is the author of many books, videocassettes and publications. He has devoted his lifetime to improving quality by providing simple methods and principles in managing quality. His teaching style is witty, highly enthusiastic and very comprehensive. He will be missed by many people around the world. The Last Word Tour was the concluding event in the 1994 conference titled "Rediscovering Quality: The Next Steps." The seminar was sponsored by the Juran Institute and attended by representatives from 23 countries. Key sessions during the seminar included: "The Relentless Pursuit of Perfection " presented by the President of Toyota Motor Company, U.S.A. Division, "Malcolm Baldrige Case-Study winners" presented by Eastman-Kodak and Ames Rubber Company, "Reinventing Government: Its Happening" presented by the Department of Energy, Customs Department and U.S. Army Materials Command and "The Quality Challenge in the Federal Government" presented by the Internal Revenue Service, Department of Education and U.S. Army Tank division. The Malcolm Baldrige National Quality Award case-study winners session was helpful, as recent winners of this prestigious honor discussed how their companies journeyed along the quality management road. Success and failures were numerous along the 15-year period of quality improvements at each firm. Many lessons were learned and both companies discussed some identical lessons discovered: Customers are the top priority, Quality is a major investment and requires teamwork, Top leadership is absolutely essential and, The more you know, the more there is to know. The Facilitator and Team Leader as Partners By Lois Hart, Leadership Dynamics Newsletter, June 1994, 10951 Isabelle Rd., Lafayette, CO 80026. Reprinted with permission. In the initial years, I trained facilitators to conduct meetings alone. However, many organizations are now forming partnerships between the facilitator and a manager who serves as the team leader. Have you ever wondered how these organizations successfully create partnerships and what the responsibilities of each are? The team leader is typically a mid-level manager or supervisor who works directly for a top management sponsor or champion. The team leader may also be the one who suggests the need to form an action team. As in a football game, the team leader serves as the captain. He or she has the content knowledge necessary to help clarify issues and find realistic solutions. Ideally, this person understands how to use facilitation skills and problem solving methods appropriately. The team leader needs good communication and leadership skills and must want to work in a partnership with a facilitator. The team leader first works with the sponsor or champion of the proposed team to: Clarify the problem and identify the goals. Create a list of tasks. Select team members. Decide on a team facilitator. Periodically discuss the team's progress, direction, and problems. Obtain input concerning major activities, problem analysis, solutions, proposals, and pilot projects. Then the team leader: Calls the initial meeting. Arranges meeting times and locations. Participates with the team members in establishing ground rules. Keeps a team schedule and progress chart. Motivates the team to take responsibility for administrative tasks. Sets up job responsibilities and keeps them focused on accomplishing tasks. Models all behaviors desired in members. Guides the team through the problem solving processes. Participates as a voting member. The facilitator's primary role is to observe and deal with the process during meetings. The facilitator is not an active team member and does not vote. As in a football game, he or she serves as a referee. The facilitator is a partner with the team leader. He or she must also coach the leader, making suggestions and giving feedback. The facilitator generally has formal facilitator training and understands how to use facilitation, team development and problem solving methods. He or she might need to educate the team leader and members on procedures and methods. The facilitator needs to have excellent communication, coaching, and human relations skills. The facilitator will: Help the team establish its ground rules. Instruct them in team dynamics and the problem solving methods as needed. Ensure that decisions are made by the total team. Develop an agreement with the team leader regarding their individual and joint responsibilities. Identify problematic behaviors and use the proper intervention to re-direct energies. Raise undisclosed issues or hidden conflicts. Help the team evaluate its progress and relationships. Serve as recorder and prepare the reports until group members are trained. Summarize meeting discussions and decisions. As partners, the team leader and facilitator are the champions of their organization's TQM, process improvement or change initiatives. Together they will: Plan and finalize the meeting agendas. Help establish a climate of trust, openness, and cooperation among all team members. Focus the team's energy on the common goal and tasks. Encourage all team members to participate fully in discussions and share relevant information. Help members to identify and solve problems. Plan a celebration when the team has reached its goals! Editor's Note: After receiving the following note from Lois, how could I do anything but reprint her article? Mark -- I just re-read your last two FLH Quality News issues. They are excellent! You pack a great deal of information into each issue. Congratulations! Lois Lessons Learned by a Project Scheduler By Carl Triplett, EFL Planning and Scheduling (P&S) systems are simple and complex. The computer software program that supports a P&S system simply calculates dates for a group of activities (a project), but the system behind its use is complex. This tidbit of information is what I, as the Project Scheduler for the Eastern Federal Lands Highway Division (EFLHD), have recently come to understand after many discussions with and training by our consultant (Project Management Technologies, Inc., Littleton, Colorado). The consultant was hired to improve the EFLHD's P&S system, to reduce our 4th Quarter Awards, and to better control our projects. The EFLHD's P&S system schedules the design activities (usually 50 activities per project) and the resources (approximately 100 employees) for the 30 or so projects designed each year. At any given time, there is at least three-year program of projects in the P&S system. This program equates to about 120 projects or to approximately 6,000 activities for the 100 employees whose work is scheduled by the P&S system (not everyone is represented in the system). Calculating the activities' start and finish dates and keeping track of each of the resource's use is a simple task for the computer, but deciding when to start work on a project and deciding how the 100 resources are assigned to the 6,000 activities (especially when two or more activities simultaneously need this resource) is a complex task. In the past, the complex task of deciding when to start a project was done by the computer software. The software started all of the projects at the same time -- that time being now. Of course, all of the projects could not be worked on at the same time, much less worked on right now! At this time, the resources came into play. The complex task of assigning resources was handled by assigning a priority number to each project. The priority number allowed for the Award Date (completion) of the project, the size of the project, the life of funding, and other factors that affect resource assignment decisions. The computer used this priority number to easily decide to which activity the resource was assigned when a simultaneous need arose. While assigning the resources to the activity, the software restricted the use of the resource to only eight hours per day. It is this availability of resources that dictated when a project could begin. The start and finish of activities were delayed until the resource became available. This method makes sense except that all of the work is compacted into the first half of the three-year program. In addition, the start of some work could have been postponed, and it would have still met the required completion date (Award Date) and allowed time for short-term projects that may need to be added to the program at any moment. What I have learned is that the resource assignment decisions are more complex than what a priority number can represent. Often, a manager of an activity disagrees with the decision that the computer has made in assigning resources due to many reasons. In the situation of scheduling field personnel and equipment, their geographical location may have to dictate on which project activity they work. For example, although a higher priority project located in Minnesota requires the field personnel and equipment, a lower priority project in Mississippi is within their immediate vicinity. Working on the Minnesota project rather than the nearby Mississippi project would require an inordinate amount of travel time and may actually take more time to complete both projects' activities. These decisions are too complex for a priority number to represent. The new method of scheduling projects will be simpler, but the resource assignment will involve much more work because the resource assignment decisions will be made by a person or a group of persons rather than the computer. The start of a project will be determined by when it needs to be finished -- a logical idea. The resource assignments will be determined by responding to resources who have been scheduled for too much work (overutilized). If a resource is overutilized, the activities requesting this resource must be rearranged, more resources must be added, or the work must be given to an outside vendor. Whatever solution is chosen, the group of people involved in the affected project(s) and the resource or the manager of the resource will decide the best solution to the problem. In effect, the employees control the schedules, not the computer. This method will keep everyone involved and informed while solving the project's schedule problems. Value-Added Oversight By Mark M. Chatfield, P.E. Cheryl Martin in the Minnesota Division of Federal Highways called the other day. She was working on methods for determining the value added by Federal-Aid Divisions. After responding, I dug out some additional material and this article was the result. The connection between oversight activities and quality is most evident in the concept of the cost of poor quality. In order to show a meaningful measure, the "cost" idea drives an estimate in dollars and other terms. This estimate is, simply put, those costs which would disappear if our products and processes were perfect. They may be categorized: Failure costs, Appraisal costs, and Prevention costs. The cost of poor quality (a Juran-coined term, p. 119, Juran on Quality by Design) has oversight implications in all three areas but particularly in that of "failure." The "1 - 10 - 100 rule" applies here: For every one dollar spent to prevent a problem, ten dollars would be required if the situation was not prevented entirely but was recognized and corrected just before it failed. A hundred or more dollars would be required if the failure actually happened. A recent example is the billion-dollar Pentium computer chip failure. It would have been very inexpensive to correct if it had been caught in the design phase. Even if it had not been caught in design, if the goof had been discovered in manufacture, it would have been relatively inexpensive to trash or maybe design around the glitch. Since it went through manufacture, assembly, and delivery, however, the cost to correct was mammoth. The cost is almost immeasurable because it affected Intel's reputation and all of those other companies which used the defective product. Oversight failure costs These costs may be subcatagorized internal and external failures and include the expenses associated with lost time due to oversight-related problems: unscheduled corrective work -- "fire-fighting," litigation, claim settlements, handling complaints, political fallout (program or project funding jeopardized), absenteeism, recruiting and training replacements, corrective work, and delays in other work. These usually involve costs within the organization (internal failure costs) as well as beyond (external failure costs). External costs include ramifications of the failure which reverberate up and down the line. For instance, a one-year delay in obligating funds for a project may mean traffic delays, crashes, fatalities, and maintenance and attendant costs are all extended. Reducing failure costs will result in increasing appraisal and prevention costs -- that's okay because we're avoiding failure. Oversight appraisal costs These costs are associated with checking how oversight is done. Inspection time, quality assurance, enforcement, and administrative costs would be included. Other elements of this are efforts to understand systems, processes, and outcome measures. Survey and management systems costs are also part of this. Reducing lengthy reviews and eliminating insignificant enforcement activities would be ways to lower these costs. Oversight "prevention" costs This would be expenses for developing oversight processes, assuring everyone understands his or her responsibilities and authority, documenting and measuring efforts. Quality control would be part of prevention costs. Analyzing and improving complicated processes and having an effective training program will reduce the cost of prevention. However, both appraisal and prevention costs are appropriate in order to avoid failure. In order to know oversight operations are under control, offices should estimate their current costs of appraisal, prevention, and failure from the customers' perspective. The objective here is to reduce the overall cost of quality by taking actions to increase appraisal and prevention work (and cost as necessary) in order to minimize failure costs. Although some of these costs will be estimates rather than hard measured figures, the estimates will show the problem and the trend and should be sufficient for management to make improvement action decisions. Keep in mind that value does not mean just money. If customers say the key to success is time, then cycle time reduction is value-added. If customers need accuracy, then reduction in error levels is value-added. Considerations of the big picture are important such as the perspective of national significance and agency-wide risk management. Steps to Take If an office were to undertake an effort to show their oversight operations are value-added, the following steps would be appropriate: Assign a work team and task them to identify a way that the office can have an ongoing awareness of the value it adds to the products and services being delivered. The team should be charged to complete the effort in a relatively short period of time. The team should use a problem solving process and document the following in simple, everyday terms: What does the public receive from what the office and its partners do? What do partners and political entities receive from the products and services that is particularly meaningful to them? In terms of money, time, accuracy, and social benefit; what is the overall value of the products and services we help provide? Estimates are acceptable if hard data is not readily available; the effort here is one of overall management not audit. In the same terms, what part of that value does the office provide? This is the Value-Added measure. Given the value of the office, identify all the possible categories of cost that result from failure to meet requirements. For instance: Employee Awareness Rework due to lack of knowledge of the current law, applicable regulations, official procedures, and policies. Obligations deferred or lost due to lack of timely information on the status of program funding. Errors made due to inadequate information on the status of program activity. Responsiveness. Delays due to absence of a key manager. Funds lost due to poor communications. Rework and delays due to cumbersome procedures. General Rework to correct consequential errors due to waste, fraud, and abuse. Rework for non-consequential errors such as operating on the edge of ethical behavior. Data entry errors. Executive Management Lengthy planning processes. Cost of restructuring/reorganizing. Redoing budget proposals. Inappropriate management strategies. External Costs Field failures. Complaints from travellers. Loss of design and construction oversight to private firms due to customers losing confidence in our performance. Field corrections of design errors. Liability costs. Insurance premiums. Litigation costs. Penalties due to lawsuits. Lost program authorizations due to inadequate justification. Mitigation of environmental damages. Find ways to measure or estimate the costs identified in "e" in terms of money, time, accuracy, and social cost. Roll-up the measures periodically, at least annually to be able to answer two key questions: What is the ratio of the cost of the office operations to the value added? (This should go down as office operations become more efficient.) and What is the total cost of assuring quality? (This should go down as failure costs decrease.) Team Case Study - IHDS Team by Bob Lale, Central Division Over the past few months I have had the opportunity to work with the Interactive Highway Design Software (IHDS) implementation team both in the role of a facilitator and that of a team member. When this team first got started, I was a member serving in the role as the pseudo CADD Coordinator for Central. I decided that after a while I was not the best choice for the team because of my limited hands-on capability, many collateral duties, and the availability of someone much more qualified. Well anyway, enough about that. This team was comprised of smart, technically competent individuals. When we got started there were some growing pains since it was not real clear what the purpose of the team was and why we were here. Most of the members had not worked in the team environment before and were uncomfortable. For that matter most of the members had never met each other before. After the first somewhat stormy meeting, I was no longer on the team. I must admit that I had some doubts that the team would succeed in their purpose or stay together. When I went back to facilitate this group recently at a meeting with the main goal of developing a measurement system to track the effectiveness of the new IHDS software, I came across a much higher performing team than the one that I had left. What had happened in my absence that would have made such a difference? I threw out the conclusion that I was the reason that it was not performing well in the first place as being preposterous. With my curiosity brimming I started to look at the book "The Wisdom of Teams". In there I found what I believe to be the answer as to why they are performing at a higher level. In this book it talks about the factors necessary for a successful team. One of these factors is a high degree of commitment that the team members must have toward each other and their charge. This team exhibits both of these types of commitment. They feel that they have been charged with something very important and feel a responsibility to succeed. Another factor for a successful team is enthusiasm and energy level. This team also exhibits this trait. Measurement is not an easy concept to grasp, especially when it is a relatively new concept to our organization, and the implementation of a new design package produces mostly intangible benefits. But in spite of this difficult challenge, the team took an aggressive, focused attack, and stayed with it devoting a good amount of their already taxed resources. One last factor for success. A team leader that is open to new ideas, and who fights to clear obstacles that would interfere with the group is necessary. This team is fortunate enough to have such an individual and this really reflects on the way the team functions and performs. In conclusion, I believe that the natural characteristics that this team was fortunate enough to have by chance, enabled it to persevere through the tough times in the beginning and continue working toward their goal as a high performing team. We need to ensure that each team created has these characteristics so that they will be equipped for success. Excellence In Highway Design - 1994 Biennial Awards By Al Logie, Headquarters On November 14, 1994, at the Annual Meeting of the American Association of State Highway and Transportation Officials, Administrator Slater announced the winners of the 1994 Biennial Excellence in Highway Design Awards. There were over 250 entries in the ten categories, all of which were excellent and deserved an award. In Category 9, "Highway Improvements on Federal, State, or Other Publicly Owned Lands" there were 18 entry nominations. Once again, Federal Lands Highway has risen to the top by being awarded the Award of Excellence Award and two Awards of Merit in this category. Our Eastern Division and the National Park Service Bridge over Forehand Hollow, Natchez Trace Parkway won the Award of Excellence with the Central Division and the National Park Service garnering Awards of Merit for the Sentinel Bridge, Yosemite National park and the Mt. Carmel Highway, Zion National Park. The Federal Lands Highway's commitment to excellence is evidenced in the selection of the winning projects by a panel of expert judges, made up of representatives from academia and the private sector. This honor further underlines the excellent quality that goes into the planning, design, and construction of our Federal Lands projects and the "Commitment to Excellence" of the Federal Lands family. We must all be proud of our accomplishment. NIKE Capital Challenge - East Potomac Park, Washington, D.C. Left to Right -- David Lippold (MARAD), Shiela Griggs (FRA), Al Logie (FHWA, HFL-1), Secretary Pena, and his wife Ellen. Al Logie Runs With The Best Washington, D.C. On a beautiful crisp morning on September 21, 1994, Al Logie as a member of TEAM PENA competed in the Nike Capital Challenge three-mile race. There were four categories in this competition, the U.S. Senate, the U.S. House of Representatives, the Executive Branch, and the Print Media. Team Pena finished 14th out of 29 in the Executive Branch with Secretary Pena finishing first as Independent Agency Head. Al says, "It was a great opportunity to compete with some of those folks on the hill who so influence our work and lives and to find out that they are just as vulnerable to a misjudgment, lactic acid buildup, and the subsequent loss of control. All in all, it was a wonderful experience to fly the FHWA/FLH colors for DOT."