Lean Finance Cards Story Profile

Sometimes a department or unit becomes so used to performing a task in a given way that it doesn’t think about doing it differently or even believe that there is a different way to do it.  Then when volumes increase, or the dept loses staff, or both, then the people left behind continue to do things the same way they’ve always been done, but they begin to fall farther and farther behind.  In the back of their minds, they know there must be a better way to do things, but they don’t feel they have the time to step back and think about whether they can do things more efficiently.  It may take someone new coming on board to look at things with a fresh set of eyes.  That person starts performing the task the same way in order to get a perspective for why it’s done that way.  The person does that with the intent to question each step to try and find a new and better way.

That’s what happened in the City of Roanoke’s Dept of Finance Accts Payable (A/P) unit.  Its supervisor left for another position and different people filled in for a period of several months before a permanent replacement was found.  In the meantime, the staff, though working harder and harder, wasn’t able to keep pace.  That’s the situation that Mary Ratcliffe found herself in when she was hired to become the new A/P supervisor. She began questioning how things were done with the intent to find a new and better way. For a new supervisor, it is a difficult and delicate path to take, challenging the ways things have always been done. But she was committed to helping her team accomplish their work more efficiently and with greater satisfaction. 

Mary began working to learn the various tasks.  When the City began implementing Lean training in February 2013, this was a good opportunity for a new employee to challenge tradition. She volunteered to be in the first class to become Lean certified.  Lean provided the tools and principles she needed to move beyond “tweaking” tasks to eliminating waste and streamlining processes.  As part of the training, the class members worked on projects that impacted City departments. Mary worked with her team to apply these principles to one of the key functions in accounts payable, the check payment process.  They identified vendors that would accept a virtual credit card payment or a direct EFT/ACH payment in lieu of a paper check with the goal of drastically reducing the number of checks the City printed and mailed out.

The core message of our story is that you must be willing to take the necessary time to step back and look at a process with a fresh new perspective.  As some wise man once said, if you continue to do things the way you’ve always done them, you shouldn’t be surprised when you continue to get the same results. Lean training gives you a different mindset and the tools to look at a task in a different light.

When reviewing the check payment process, Mary spoke with the City’s Dept of Social Services about their plans.  Though A/P could not offer to pay the Social Services vendors via credit card, Social Services wanted to help A/P with its goal to significantly reduce the number of checks printed.  However, they didn’t really think many of their vendors would be interested in being paid electronically. Nevertheless, they decided that it wouldn’t hurt to ask.  Social Services staff sent letters to their eligible vendors and offered them the ability to receive their payments via EFT/direct deposit.  To both A/P and Social Services staff’s surprise, within a couple of days, they received back in the mail numerous positive responses.  All told, more than 50% of Social Services’ vendors have agreed to switch with more vendors being added weekly.  To date, A/P has reduced the printing of social services checks by nearly 50%.  This serves to illustrate that sometimes you can have pre-conceived ideas about whether a change can be implemented based on your past experiences, but you can be pleasantly surprised if you take the initiative with a well thought out plan. 

The improvements in this process have resulted in hard and soft dollar savings as well as real revenue generation.  To date, approximately 2,600 less checks have been printed; $28 per check in soft dollar savings, or $72,800, has been achieved; approximately $2 per check in real money is being saved, or $5,200.  The City has seen an increase in revenue through the rebate program with our purchasing/credit card provider of $36,480.  In addition, it has given the A/P staff time more time for other Accounting duties related to the month-end close process and duties related to the City’s CAFR document.  Additionally, when other Accounting staff has to fill in for A/P staff due to time off, the new process does not create a burden on them in getting their own work done plus the check processing duties. 

Even without the Lean training, Mary is always looking for better ways to do things.  That training together with the support of the Finance Dept’s management staff have just given her additional tools to continue to seek out efficiencies.  She has become one of the City’s most passionate spokespersons for our Lean initiative.  As an example, together with our Director of Management and Budget, she recently gave a presentation at the Virginia GFOA conference on the City’s Lean efforts with this project being used as our example. She is also one of the staff members who are undergoing Lean Six Sigma green belt training through the City’s partnership with Virginia Tech.

The City of Roanoke has not hesitated to utilize newly hired team members on Lean teams. Looking as processes through the lens of those not married to process, previous tweaks and refinements, provides the freedom for both new and seasoned team members to collaborate and present fresh perspectives with better results.