Stimulus Spending Needs Jidoka – The Proof Is In the Pork

Information on recovery.gov recently reported that the Department of Agriculture was paying $1.2 million for 2 pounds of frozen ham. In fact the contract in question actually purchased 760,000 pounds of ham for $1.191 million for food banks and homeless shelters. In response to misstated information the board overseeing recovery.gov refused to correct the information stating it was not their job – it was the Department of Agriculture’s responsibility to correct the information. “We get this information from the agency and we’re not going to correct their information,” board spokesman Ed Pound said. “We’re not going to go in and clarify these summaries. We’re not going to fix it. I suppose if they send us a note to change it, we might. “Unfortunately this highlights the challenge of managing a program as far reaching and complex as the stimulus funding. It also highlights one of the most difficult aspects of implementing Lean – particularly within large, complicated and functionally siloed organizations such as government. It would be surprising to not have seen dozens of government employees to read about or hear Mr. Pound’s comments, hang their heads and walk away grumbling about how things never change.

What should have happened in this scenario is that the recovery.gov team should have recognized that something was amiss in the information provided versus just mindlessly inputting data. They would have contacted the team at the Department of Agriculture to notify them that their report was incorrect and to please investigate the information before the deadline to post it. The source of the information would then investigate, correct the information and forward it to the recovery.gov team. The Department of Agriculture would then have investigated the root cause of the wrong information and put in place permanent corrective action to mitigate the wrong information being posted again. Ideally the final step would have been for them to share lessons learned with other agencies.

In the Toyota Production System or Lean Management this is known as Jidoka. More often we refer to it as abnormality management and mistake proofing. It is one of the basic tenants of Lean management and a key differentiator between the success Toyota has enjoyed with Lean principles and the applications normally found in other companies and industries.

The type of thinking demonstrated by the recovery.gov team in this case is exactly what was in place (and likely still is) within financial services, automotive manufacturing, healthcare, airlines and other industry verticals that have gotten themselves in significant stress. And, as demonstrated above, it exists within government.

To ensure this type of dysfunctional culture will not be one of the most difficult challenges the new administration will face in driving change, it will require commitment, follow-through and consistency to create a high-performance government.

By Ron Wince, CEO of Guidon Performance Solutions
Post taken from The Ascent Blog: http://blog.guidonps.com

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Colleen Cassity

We are in the business of continuous controls monitoring for transaction (CCM-T). The fed needs to use CCM-T for all their divisions and agencies to prevent such problems. Millions of dollars are going to be lost to fraud, misuse, abuse and error. We currently have helped the D.O.D. save millions Recovery, TARP, etc., need to get transparent too.

Ron Wince

I’m not familiar with your firm but I completely agree that a solution is required to track the stimulus. Even more the federal government needs a solution beyond just the stimulus.