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Feb. 21, 2001
Executive Sims, employees and unions unveil innovative new program to 'Do Business Differently'
King County Executive Ron Sims, County employees and labor unions today unveiled an
innovative program that demonstrates how "a government of the 21st Century should operate"
by making one group of County employees "partners in business." Sims said the new
program reflects a cooperative effort of management, labor and employees that will
cut operating costs, increase productivity, and continue a high level of service and
environmental protection to County residents.
The pilot program will allow employees to employ the kind of business practices used
in private industry, and typifies the kind of work practices Sims expects King County to be using in the future.
The Productivity Initiative Pilot Plan is a joint labor, management and employee effort in the
wastewater division that could save ratepayers as much as $67 million cumulatively over 10 years
and serve as a model Countywide for new efficiencies and savings. Later this year, a plan
will be sent to the King County Council with capital savings that will complement this program.
"With the help of employees and our unions, we will be operating like a private business,"
said Sims. "Employees will have the freedom to operate their business with
specific productivity goals and business targets, and must show us that
they can be more efficient without compromising our high standard for
protecting public health and the environment."
The goal of the program is to make King County's wastewater treatment program the
most efficient publicly operated such system in the nation within the next five
years and to be competitive with the industry's best private operations within 10 years.
This will be accomplished, Sims said, by having the Executive and Council establish the
direction and guiding principles for the wastewater system, and by letting employees
"tell us how to get there." This includes things like:
- Having employees involved in setting productivity targets and letting them decide how best to get there;
- Cross training employees to save time and money;
- Better use of capital investments;
- Limiting "micromanaging;" and
- Reducing management staff and consultants by letting employees make decisions.
The Productivity Initiative Pilot Program is the result of the cooperative effort begun in 1999 with three unions that represent wastewater workers. The unions that have worked with the County to develop the program are the Service Employees International Union (SEIU) AFL-CIO, Local Union 6; International Brotherhood of Teamsters Local Union 117 and; the Washington State Council of County and City Employees AFL-CIO, Council 2.
"For many years, SEIU Local 6 members at Wastewater Treatment Division have worked to increase efficiencies and reduce costs through the Gainsharing Program that had been agreed upon between Local 6 and the former Metro organization. This has continued with our contract with King County," said Irene Eldridge, secretary-treasurer of SEIU Local 6. "This new Productivity Initiative takes these efforts to a higher level that will return even greater value to the citizens of King County."
"I commend the Executive for his commitment to use appropriate practices from the private sector while still putting the needs of our citizens first," said County Councilmember Larry Gossett. "Citizens must be confident that government will not compromise public health and safety or the environment to achieve new operational savings."
The plan includes seven key elements:
- Developing a business plan for the wastewater program that includes performance and accountability measures;
- Establishing yearly budget targets for the next 10 years and aggressively holding to a 'bottom line;'
- Creating an Incentive Fund for employees with half of the savings achieved beyond targeted goals, and using the other half to help reduce the need for rate increases;
- Linking the plan to labor agreements for critical labor-management cooperation; and
- Developing service agreements within the County to ensure cost-efficiencies and certainty of service.
Sims cautioned that the targeted savings are based on the Year 2000 Budget with assumptions of three percent inflation each of the 10 years. Base figures would be adjusted for a rate of inflation higher than three percent or for extraordinary costs of needed commodities to run the plant, such as electricity.
A description of the wastewater program's productivity initiative is provided below.
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"We are committed to being on the cutting edge," said Executive Sims. "This is a program that demonstrates how a government of the 21st century should operate." Pictured with Executive Sims is John Williams the consultant who helped with the development of this program.
[Enlarged view, 403 KB]
King County Councilmember Larry Gossett commended the Executive for his commitment to using practices from the private sector while still putting the needs of the citizens first. "Citizens must be confident that government will not compromise public health and safety or the environment to achieve new operational savings," said Councilmember Gossett.
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Wastewater Program's Productivity Initiative
The Wastewater Program's Productivity Initiative is the opportunity for a traditional utility to become a publicly run business entity of the 21st century - managed and operated more like a business. To the Wastewater employees, this means providing the same high quality services to the public that we always have and doing it using the right technology, human resources, and fiscal planning that can found in the business world today. To the public this means being more efficient, making a commitment to reduce costs, and meet our obligations to protect the public health and wastewater system.
The Productivity Initiative identifies up front specific levels of cost reduction and efficiencies over the ten years that the program will commit to resulting in savings to the ratepayer. Estimated cumulative savings over the next ten years are estimated to be $67 million. Since late 1999 we have undertaken an intensive review of our existing business practices; identified and implemented cost savings practices; working to make improve employee morale; and ensuring that the Wastewater Program is getting the best possible services from our partnering county agencies.
The Productivity Initiative links management decisions about employees with labor. It requires that management and labor cooperate to identify new ways of getting the business done, meeting the bottom line, protecting public health and safety, and allowing employees to share in the rewards and risks of operating a business entity of the 21st century.
This means managing our utility with an eye to competitiveness as well as accountability, allowing us to present a viable alternative to privately run utilities. We are doing this in partnership with labor, using our connections with other utilities, and taking the best of the work we have already done to increase efficiencies and drive down costs.
The Productivity Initiative business planning has identified immediate savings by working smarter with less administrative positions, reducing our reliance on expensive consultants, and making investments in energy savings. Examples of longer term savings are to reduce staff and managers through attrition and allow employees to be more flexible in how they do their jobs, recycling grit, standardizing equipment and the use of spare parts inventory, reduce our reliance on outside energy sources, and better coordinate odor and corrosion control.
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Updated: Feb. 21, 2001
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