implementing lean in public administration: research...
TRANSCRIPT
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January 6th, 2017
Department of Informatics
University of Oslo
P.O. Box 1080 Blindern, 0316 Oslo (Norway)
Implementing Lean in Public Administration: Research proposal
1. Introduction
Quality management fads come and go, often using different names for presenting more or
less the same content (Cole, 1999), but the management philosophy known as Lean
Manufacturing, Lean Production, Lean Management or simply Lean, with it’s emphasis on
production flow and just-in-time delivery, has been in popular use under its current name for
almost 30 years, and continue to attract attention among practitioners and scholars, not at least
within the area of information systems research (e.g. Sindre et al, 2016).
Lean started out in the manufacturing industry, as a way of trying to describe characteristics
of the Toyota Production System (Krafcik, 1988; Womack et al, 1991), but the ideas behind it
are universal, and it has been applied in a wide variety of processes and organisations,
including software development (Poppendick & Poppendick, 2003; Rolfsen & Wulff, 2014)
and public administration (e.g. Zadnor & Boaden, 2008; Aune & Holmemo, 2014). Despite
the popularity and many success stories, Lean is still considered difficult to implement, with
implementation failure rates estimated by some sources to be well over 50% (Kallage, 2006).
As Røvik (2007) points out, there are different ways of implementing management
philosophies, and successful implementation requires the philosophy to be intelligently
translated into local context. However, this also raises a dilemma of understanding when a
philosophy is properly translated and when people are just pretending (Brunsson, 2002). In
the case of earlier attempts to translate ideas associated with the Toyota Production System,
such as Total Quality Management (TQM), it has been possible to distinguish between a
flexible interpretation and a misunderstanding of concepts, as formal and operative definitions
of TQM include assessment methods such as the EFQM excellence model, but in the case of
Lean Manufacturing it is much less clear how evaluation should be carried out.
While some organisations may choose to implement Lean for the purpose of showing how
they are up to date with the latest management trends, thus choosing to reinterpret whatever
has always been done in the language of Lean and believing that this means that Lean has
been implemented, for organisations less concerned with image and more concerned with
performance, it may be relevant to try to understand and apply Lean theory for the purpose of
reaching the same level of quality, productivity and reliability that has been achieved by
model-companies described in the Lean literature.
If we look at the case of the Norwegian Tax Administration (NTAX), this could be an
important example of how Lean has been successfully implemented in public administration.
A Lean-inspired programme was initiated in 2008 and it has been effectively used for
transforming organisational performance (e.g. Roheim, 2011; Lean Forum Tromsø, 2012;
Aunan & Paulgaard, 2016; Aunan & Roseth, 2016), resulting in the NTAX director giving
keynote speeches at Lean conferences (Løkken, 2012; Kristensen, 2015).
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On the other hand, as Baksjøberget (2014) points out, even though the translation from Lean
theory to NTAX practice has been successful, that doesn’t mean it is necessarily easy for an
outsider to understand how NTAX did this and how the new NTAX practice is different from
the old. In other words, it may be difficult to learn from cases like NTAX unless the
translation from theory to practice is more clearly explained.
1.1 Research question
While some public sector organisations have achieved success in implementing Lean, like in
the case of NTAX, others struggle (Rolfsen, 2014). There are consequently gains to be found
from understanding how more successful organisations have carried out their Lean
implementation journey, what were the lessons learned, and what they are presently doing for
making Lean sustainable and improving practice even further. In general terms, the overall
research question can be summarised in the following manner:
• How to implement Lean in public administration?
While there may not be a single answer to this question, as translation theory is based on the
assumption that all general frameworks have to be specifically adapted to local context, it is
still interesting to look at how NTAX has implemented Lean. The studies conducted at NTAX
so far have mostly been focusing on how NTAX members felt about the implementation and
the translation, with limited insight on how the practice at NTAX relates to the theory in the
Lean literature (Baglo & Langvatn, 2012; Alshbib & Ulvin, 2013; Baksjøberget, 2014).
2. Theoretical approach
Since Krafcik (1988) introduced the term ‘Lean Production’ for describing the Toyota
Production System (TPS), there has been an extensive growth of literature referring to Lean,
both of academic and popular type. However, as Baksjøberget (2014, pp. 4-6) points out in
her review of literature aimed for understanding how NTAX has translated the theoretical
definition of Lean into practice, there is at present no single definition of Lean that everybody
agrees upon. Instead, there is a wealth of different definitions, principles, models and theories
that all go by the name of Lean while referring to TPS in one way or another.
However, this should not be interpreted to mean that Lean can refer to anything whatsoever.
The concept of Lean is not new. Before people started talking about Lean, the American
response to competition from Toyota and other Japanese companies in the late 1970s and
early 1980s was understood as a response to a quality crisis. Although most of the quality
assurance methods used in Japanese industry were based on ideas developed in the US and
Europe, the methods had become part of a company-wide Japanese quality management
approach that the West now tried to understand and implement as Total Quality Management
(TQM). Although TQM enjoyed widespread attention in the late 1980s and early 1990s,
implementation failure rates have been estimated to have been about 80%, and TQM thus
became overshadowed by ISO 9000, Six Sigma and Lean.
Although ISO 9000, Six Sigma and Lean may not necessarily be any different from TQM in
content, the different programmes put different emphasis on how to implement company-wide
quality control. The emphasis in these three particular efforts could, for instance, be argued to
be that of quality standards, statistical quality control and just-in-time processes. However,
each particular emphasis also resulted in critique. As an example, some of the critique raised
during the early popularity of ISO 9000 standards was that the approach was more likely to
cement existing practice of mediocre quality or make results worse as the easiest way to
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implement the ISO 9000 standards would be to describe how everything was presently being
done and then develop standards and procedures for making sure practice continued without
change (Seddon, 1997).
While companies like Toyota had become brand leaders due to continual improvement over
several decades, the promise of TQM, ISO 9000 and Six Sigma was that quality management
and corporate excellence could be implemented by means of projects that lasted only a few
years. For example, Business Process Reengineering (BPR) was an approach that arrived on
the scene in the early 1990s, essentially yet another reformulation of the same old ideas, but
this time focusing on how organisations could be transformed by considering business
processes as black boxes that needed to be reengineered by use of information technology for
improving quality, productivity and competitive advantage (Hammer & Champy, 1993).
When writing about the different quality management fads, Cole (1999) makes the point that
it may not necessarily be a bad thing that different programmes fail and are rediscovered or
reintroduced under different names because the problem with the programmes is often not the
theories themselves but the difficulty in getting them implemented. In wanting to implement
something that requires an evolutionary approach by means of a TQM implementation project
is likely to fail. Projects are restricted on time, cost and functionality, so there is limited room
for experimentation. A single project is not the way to approach this, but an everlasting
sequence of projects may be useful. For this reason, it might be a good thing that ISO 9000
focuses on standards, Six Sigma on statistical methods, BPR on process design, TQM on
large-scope issues like quality awards and assessments, so allowing the same problem to be
addressed over and over again by means of different angles. In particular, what makes Lean
interesting in comparison to these other approaches is how it focuses on just-in-time
management and single-item flow.
Modig and Ahlström (2012) use a hospital setting for explaining Lean. In this setting they
define a dilemma between optimal patient flow and optimal use of resources. As surgeons are
expensive, it seems better to have patients line up in a queue for surgery than to have the
surgeons running idle most of the time as they are waiting for the next patient to arrive.
However, if patients have to go through a sequence of processes that have all been optimised
with respect to use of resources, this creates bottleneck in the process, causing the patient to
spend most of the time between arriving and departing in a state of waiting. The Lean
challenge thus consists of developing standardised yet flexible solutions with the aim of
making patients flow through the system as quickly as possible, with as little cost as possible
and with the best possible outcome. For other domains, such as an organisation like NTAX,
there are similar dilemmas between making sure that the tax lawyers and other experts are
kept busy while at the same time making sure that the individual cases reported by the clients
are not spending most of the time on wait.
However, Lean does not only have to apply to interaction with external clients. What
characterises a Lean company like Toyota is that all types of processes are managed in a
similar just-in-time and single-flow manner (Liker, 2004). For example, in a case like NTAX,
where information systems and software are being developed and maintained by in-house
resources, one might expect that Lean principles are being applied for making sure that
systems are developed and improved quickly and with high quality (e.g. Poppendick &
Poppendick, 2000). Also, as NTAX is using a quality management system that is supposed to
be compliant with the ISO 9001 standard and other standards, it would be natural to expect
that the quality management system is developed and maintained according to Lean principles
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and is being used for supporting the overall Lean structure of the organisation (Guderian &
Renaud, 2008; Micklewright, 2010).
2.1 The NTAX Lean implementation process
When Baksjøberget’s (2014) argues how the success of the NTAX Lean approach had to do
with how Lean theory was intelligently translated into local NTAX practice, it is interesting to
see how the NTAX implementation method relates to the implementation methods discussed
within the Lean literature. For example, the so-called “five principles of lean” (Womack &
Jones, 1996) is an implementation method that is often referred to in the literature (e.g.
Rolfsen, 2014). The five principles are the principles of value, value stream, flow, pull and
perfection, and can be linked together in an improvement wheel of the type illustrated in
figure 1.
Figure 1. Lean Principles (http://www.lean.org/WhatsLean/Principles.cfm)
In an organisation like NTAX, it should be possible to interpret concepts like value, value
stream, flow, pull and perfection quite straight-forward, regardless of whether the process in
question deals with minimising the lead time for tax payer requests, developing NTAX
software, running the ISO 9001 quality management system, or all kinds of management
processes, operational processes and support processes. The content of each step in figure 1 is
as follows:
1. Specify value from the standpoint of the end customer by product family.
2. Identify all the steps in the value stream for each product family, eliminating
whenever possible those steps that do not create value.
3. Make the value-creating steps occur in tight sequence so the product will flow
smoothly toward the customer.
4. As flow is introduced, let customers pull value from the next upstream activity.
5. As value is specified, value streams are identified, wasted steps are removed, and flow
and pull are introduced, begin the process again and continue it until a state of
perfection is reached in which perfect value is created with no waste.
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Although neither Baksjøberget (2014), nor any of the other resources on NTAX Lean
consulted in the writing of this proposal, make any references to the model above, that does
not necessarily mean that some version of the model has not been used, unless the success
with Lean at NTAX has to do with following a radically different approach.
2.2 Knowledge gap
The purpose of the literature review so far has been to sketch some ideas about what is
commonly understood by Lean in the literature, thus trying to manage some of the
expectations concerning what is to be understood by “NTAX Lean”. In what seems like the
most thorough study on NTAX Lean so far, Baksjøberget (2014) claims that Lean theory has
been successfully implemented into local NTAX practice, and she argues this by referring to
interviews done with various people within the NTAX organisation. As the director of NTAX
has also given key note presentations at the Norwegian Lean Forum, there is no reason to
doubt that NTAX is indeed among the best in class when it comes to successfully
implementing Lean in the public administration, but it is still unclear what this actually means
in terms of how NTAX Lean relates to Lean theory, both in terms of approach and results.
From the viewpoint of information systems development (ISD), it is particularly interesting to
see how NTAX has succeeded with Lean methods of software development and quality
control as ISD has been a challenge within large parts of the public sector, including the
Norwegian Armed Forces, the National Police Directorate, the Norwegian Labour and
Welfare Administration, and the Norwegian Directorate of Health. In all of these domains
there have been costly examples of failed ISD efforts, although in some cases they have been
working with Lean ISD and are interested in learning from others (Rolfsen, 2014).
The hypothesis of this literature review is consequently that there should be significant
possibilities for the Norwegian public sector to learn about how to succeed with Lean and ISD
if it is possible to extract insights from the success at NTAX in a language that makes it
possible to translate insights from one public sector domain into another.
3. Research design
To succeed with a study on how to implement Lean in public administration, by considering
the case of NTAX, it seems reasonable to take advantage of earlier experience in doing and
trying to do research on TQM and IT government at NTAX (Øgland, 2013; 2016). A central
aspect of this experience is that the most effective way of researching NTAX was by working
as a regular member of NTAX and to carry out research from this perspective. This approach
is commonly referred to as action research, and means that both action and research is carried
out at the same time.
There are many ways of designing action research, depending on how ambitious a client
organisation like NTAX is in terms of wanting to understand and improve current practice.
For example, an approach known as canonical action research (CAR) is an approach that may
be useful when the action researcher is part of an ISD project, and the aim of the research
involves the testing of a given ISD method as action hypothesis (Davison et al, 2004).
However, if the action researcher does not have a formal leadership position, making it
difficult to study how ‘we’ are diagnosing a situation and implementing a treatment, a less
ambitious approach is to study how ‘I’ am diagnosing a situation and implementing a
treatment, something that is often referred to as self-improvement research (e.g. Whitehead,
1989; McNiff & Whitehead, 2006; Øgland, forthcoming).
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As a central part of the earlier experience in doing research at NTAX was that office politics
would make it difficult to get access to data or create other difficulties in carrying out research
(Øgland, 2013, pp. 123-141), the challenge of rigging a CAR project could be seen as a
research problem in itself (Øgland, 2007; 2016), meaning that the best way of starting any
type of action research at NTAX might be by starting the project as self-improvement
research on how to obtain data on how NTAX Lean has been defined and implemented, and
then use the outcome of this self-improvement action research as an opportunity for engaging
in ISD action research where the actual aim is not only to understand NTAX Lean but also to
help improve the effectiveness and efficiency of the approach.
What this means in practice is that research depends on the action researcher being given a
formal responsibility at NTAX for auditing the quality and security management systems,
investigating whether the IT function is operating according to expectations and agreements,
thus allowing him to research how this kind of audit work can be conducted in an optimal
manner, constraint by issues like NTAX culture and formal regulations. However, in addition
to performing this task, time is needed for reading, writing and engaging in discussions within
the academic community concerning how the task can be improved. In practice, this may be
best achieved by maintaining regular contact with academic staff at the Department of
informatics at the University of Oslo, where the researcher has a formal position as Visiting
Researcher.
It would also be natural that the researcher keeps in regular contact with the NTAX research
community, headed by Dr. Marcus Zackrisson, and collaborate with the Internal Audit, the
Continuous Improvement Programme and other units, inside and outside of NTAX, that share
similar interests in understanding how the overall Lean philosophy is implemented, although
the researcher remains part of IT staff or contained in whatever NTAX unit that is given the
future responsibility for monitoring and improving IT governance.
4. Expected outputs
The expected outputs of the research are both practical and theoretical. First of all, putting
somebody in charge of looking at how quality management for the IT function of NTAX
complies with the NTAX Lean philosophy and other aspects of NTAX philosophy is expected
to be a task that has been neglected for some time and is expected to be of vital importance for
improving IT governance in a cost-effective manner.
After having established this operative function of investigating and assessing the quality and
security management systems of the IT function, further practical improvements are expected
to follow from dialogue between different NTAX units working with Lean, quality
management, continuous improvement, audit and control. If the dialogue and coordination is
done according to the principle of the bootstrap algorithm (Hanseth & Aanestad, 2003;
Hanseth & Lyytinen, 2010; Øgland, 2016), an overall quality control infrastructure is
expected to emerge.
In terms of contributing to the research community, the early stages of research are expected
to contribute to the literature on Lean ISO 9000 assessments and similar issues, depending on
what standards are in current use and what standards NTAX would be interested in
investigating. Self-improvement research of this type is relevant both for action research
journals like EJOLTS (Øgland, forthcoming), journals concerned with systems research, and
journals and conferences that specialise in IS research, such as the ECIS conference (cf.
Øgland, 2009).
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If the self-improvement research succeeds in the initial steps of bootstrapping a NTAX quality
management infrastructure for the IT function, the action research may evolve in direction of
CAR and the research will be less concerned with the challenges of the ‘I’ of the researcher
trying to improve his own practice towards the ‘we’ of the community working with Lean and
quality management within the context of IT governance. As the practice makes a deeper and
wider organisational impact, the research will also change focus from psychological
perspective to a sociological perspective on organisational change (Herr & Anderson, 2005,
pp. 29-48). Gradually, it may also be relevant to visit other organisations to see how they are
struggling with their Lean implementation.
In addition to publishing academic papers for conferences and journals, focusing on particular
issues and challenges, the overall perspective will be maintained by a continued focus on
writing a book on how to implement Lean in public administration. The book will be aimed
both at the academic audience and as a format for presenting the NTAX experience for
members of communities like Lean Forum Norway.
5. Budget
The research is financed by the Norwegian Directorate of Taxes, but will take advantage of
applying for external funding from sources like the Regional Research Fund for the Oslo Area
(RFFH) whenever such opportunities are given1.
Researcher’s contact
The researcher concerned (Petter Øgland) will alternate offices between the IT staff of the
Norwegian Directorate of Taxes, the Department of Informatics at the University of Oslo and
his home office at Bekkestua. His contact address is: [email protected].
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