Guide for Customer-Driven Benchmarking of Maintenance Activities (2004) / Chapter Skim
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79 CHAPTER 4: STEPS OF CUSTOMER-DRIVEN BENCHMARKING AN OVERVIEW OF THE STEPS Chapter 4 sets out a five-step process for customer-driven benchmarking for road maintenance. It provides a detailed description of each step and includes worksheets to help you develop measures, organize your measurement activities, record the results, analyze improvement opportunities and best practices, and implement improvements.
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The second involves identifying measures to use for benchmarking that directly relate to the attributes of the products and services that a maintenance organization provides its customers. Instead of thinking about maintenance activities, you will have to reorient your thinking to what the customer is "buying." This second step is composed of the following smaller steps: ♦ Identify the role of the customer in the vision and the mission of the maintenance organization, ♦ Identify products and services that the customer is buying and the corresponding attributes and maintenance activities, ♦ Identify candidate customer-oriented outcome measures that correspond to each attribute, ♦ Identify measures for resource usage, ♦ Identify measures pertaining to hardship factors, ♦ Identify output measures, and ♦ Assess the value of using various customer-oriented measures and select the ones you will use.
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performances. This third step is composed of these smaller steps: ♦ Plan and schedule measurement activities, ♦ Develop a database, ♦ Take measurements and record the results, and ♦ Share results.
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STEP 1. SELECT PARTNERS The first step of the benchmarking program is to select the group of benchmarking partners you will be working with.
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♦ In the left two columns enter the number and the name of each subunit. ♦ In the remaining columns to the right, for each subunit provide the following information: – Lane miles; – Number of employees; – Budget (maintenance)
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Name of Benchmarking Unit Lane Miles No. of Employees Budget ($000s)
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You should carefully distinguish between the two because the focus of customer-driven benchmarking is on external customers. The vision statement may also stress a commitment to quality, continuous improvement, or both.
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Chapter 4: Steps of Customer-Driven Benchmarking 86 Use Worksheet 2 to analyze the role of the customer in the vision of your agency: ♦ Write out your current vision statement, ♦ Identify key phrases in your vision statement, ♦ Identify how each phrase relates to the customer, ♦ Assess the degree to which your vision statement relates to the customer by checking off the appropriate answer to each question, ♦ Write a revised vision statement if you feel it will benefit your benchmarking activities, and ♦ Verify that key phrases of your revised vision statement have a relationship to the customer by completing the last part of the worksheet.
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Addresses environmentally sustainable quality of life of customers ASSESSMENT OF VISION STATEMENT ❑ Customer(s) directly addressed?
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A common mission statement says the agency is responsible for providing safe, efficient, aesthetically pleasing transport of people and goods in a manner that is sensitive to the environment. Below is the mission statement of the Maryland State Highway Administration.
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89 Use Worksheet 3 to analyze the role of the customer in the mission: ♦ Write out the current mission statement, ♦ Identify key phrases in your mission statement, ♦ Identify how each phrase relates to the customer, ♦ Assess the degree that your mission statement relates to the customer by checking off the appropriate answer to each question, ♦ Write a revised mission statement if you feel it will benefit your benchmarking activities, and ♦ Verify that each key phrase of your revised mission statement has a relationship to the customer by completing the last part of the worksheet.
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Yes No ❑ Addresses quality/continuous improvement? Yes No ❑ Others: REVISED MISSION STATEMENT (for Agency or Road Maintenance)
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However, these activities were not described in such a way that the relationship to the organization's customer was apparent. The connection between the activities and customer satisfaction, customer-oriented outcomes, or the value customers received was weak or not evident.
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Chapter 4: Steps of Customer-Driven Benchmarking 92 ♦ The ability to drive the speed limit, unrestricted by snow and ice? ♦ Safe passage to destination on roads free of snow and ice -- in other words, on roads whose pavements are returned to bare condition as quickly as possible after snow or ice begins to accumulate?
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5. Safety features – Guardrail and bridge rail condition, – Pavement markings, – Roadway lighting, – Signing, and – Traffic signals functioning as designed.
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Chapter 4: Steps of Customer-Driven Benchmarking 94 Table 3. Attributes MnDOT Has Identified or Addressed in Market Research Category Attributes Clear of unplanned obstructions Roadway clear of ice and snow Trucks plowing as soon as snow appears Plowing frequency during average snowfall Ability to see shoulder striping during snowfall Ability to see road edge during snowfall Ability to make turns at crossovers/intersections Driving speed during snowfall Day versus night snow removal expectations Weekend versus weekday snow removal expectations Radio channels listed for weather/road information Bare wheel paths Scattered slippery spots Only right lane plowed to bare pavement All driving lanes plowed to bare pavement All lanes plowed full width Clear Roadways Fully cleared intersections/crossovers Availability of roadway for year-round use Road ride comfort Smooth and Reliable Pavements Road reliability Available Bridges Availability of bridges Guardrail and bridge rail condition Pavement markings Roadway lighting Signing Traffic signals functioning as designed Attractive woods by road and lack of clear space to woods Vegetation on shoulders blocking site distance Vegetation blocking site distance at corners Safety Features Vegetation blocking signs Amount of roadside litter Noxious weed presence Vegetation height Attractive Roadsides Neatness of vegetation Encroachments on right-of-way Accessibility of permit office Consistency of permit requirements Highway Permits/ Regulations Time to issue permits Motorist information on unplanned conditions Motorist Services Rest area attractiveness
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Attributes of Products and Services Important to Your Customers You will now use the inputs you have obtained from market research literature, surveys conducted by other organizations, focus groups, and additional customer surveys your organization has undertaken in order to begin to characterize what customers of maintenance are buying. If no research information is available, you can use your internal team for ideas on what customers want, desire, or are buying.
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Obstruction of safety features 1. Legibility of signs 2.
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. ♦ In the center column, list the maintenance activities that impact the attributes of the product or service.
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Bridge rail repair 71 c. Sign repair 72 d.
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for which you are identifying candidate measures. ♦ In the top half of the worksheet labeled "Outcome, Condition Measures," list candidate measures that are for assessing the conditions of a product or service attribute resulting primarily from maintenance activities (e.g., "time to return to bare pavement" after a snowfall)
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Number of potholes per lane mile Yes No 5.
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of the product or service. ♦ In the left column labeled "Name of Measure," list the name of each candidate benchmarking measure corresponding to the product or service attribute.
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deviation in elevation from a fixed horizontal 100% coverage IRI plane per mile September H Semi-annual driver survey rating smoothness Customer County of pavement on a 1–5 scale Survey Survey Question April & October Database M
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In Worksheet 8, you want to identify the measures that will be used to indicate the amount of resources expended to deliver the product or service. Resources are labor, material, and equipment used by the maintenance agency and other service providers with whom the agency contracts to perform maintenance activities for the product or service.
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♦ In the first and second columns, enter the activity code and the name for each maintenance activity that will affect a measured outcome of this product or service. ♦ In the third column labeled "Labor (UOM)
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WORKSHEET 8. RESOURCE MEASURES Product/Service: Clear Roadways (Ice & Snow)
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High population density, severe weather, and difficult terrain are examples of hardship factors. Data regarding several hardship factors should be collected and measures should be calculated before a judgment is made as to which hardship measures to use in evaluating performance.
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County Nov-Apr H Average daily traffic Traffic County Annual M Elevation change per mile in feet Topographical Map Terrain Area Continuous H
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Chapter 4: Steps of Customer-Driven Benchmarking 108 Use Worksheet 10 to identify the candidate measures of production for each product or service. ♦ At the top of the worksheet, enter the product or service name.
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Total Miles of Anti-icing, Plowing & Sanding Garage 57 M
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This assessment could result from a thorough investigation with detailed calculations; however, a more general and subjective assessment is appropriate to ensure that there likely is a benefit to the agency and partnership for having a new measure. Also, if there are several candidate new measures for which data needs to be collected, then there should be a comparison of the costbenefit relationship of the candidate measures.
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111 Use Worksheet 11 to profile your estimates of the cost-benefit relationship of various candidate measures that will require new data collection and cannot currently be calculated. ♦ For each measure, rate the cost as high, medium, or low.
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Contractor breakout of costs of labor equipment, material Condition rating, surface rating inspections Potholes per lane mile B E N E F I T S MEDIUM LOW HIGH C O S T MEDIUM LOW HIGH
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. ♦ In the remaining columns to the right, for each outcome, output, resource, or hardship measure, provide the following information: – In column three, a description of the measure (e.g., mean of total segment samples of edge drop-off of more than 2″ extrapolated to the number of lane miles)
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Manual H 1 Degree Days Number of degrees below freezing summed for the year Degrees 0–50 Sum Maint. Manual Section 4.2 OP 1 Lane Miles Treated Numbers of lane miles treated with activities 150– 165 for the season Lane Miles 0–500 Sum Maint.
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♦ Repeat the code and name of the measure and the first two columns from Worksheet 12 (e.g., OC1, Customer Satisfaction with Sign Visibility)
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WORKSHEET 13. AVAILABILITY OF DATA AND MEASURE Product/Service: Smooth Pavement Name & Code of Partner: Department of Transportation, 00031 Benchmarking Agreement #: 1234567 Organizational Level of Benchmarking Unit: County Number of Benchmarking Units: 13 Code Measure Name Descriptions of Data Being Collected J F M A M J J A S O N D Roughness ratings, mean for OC 1 IRI primary roads for each county x x x M Summary mean of responses to OC 2 Survey Pavement Smoothness question rating smoothness or roads x x x x x x M All labor hours logged in MMIS for R 1 Labor Hours activities 150–159 x x x x x x x M All equipment hours logged for R 2 Equipment Hours activities 150–159 x x x x x x x M Number of degrees below freezing each H 1 Degree Days day of the year x x x M x x x Amount of rain, ice, and snow fallen H 2 Precipitation in a year, annual data x x x x x x x x M x x x Total # of lane miles treated by OP 1 Lane Miles Treated activities 150–159 x x x x x x x x M
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to the next, then partners cannot very well compare performance of benchmarking units. Another example is that some partners may need to institute customer satisfaction 117
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♦ A time when the partner who will perform the performance comparisons will provide the results to all partners. ♦ A time frame for each of the "best" or better-performing benchmarking units to document their practices and make them available to each of the other partners.
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If there is no gap in time, then each partner will need to document business processes during the period of data collection. Documenting Existing Business Processes Part of your preparations for benchmarking should involve documenting your existing business processes, particularly those you plan to benchmark.
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Figure 10 shows an example of a business process flow diagram. Note that the actors involved in each step are identified at the top of the diagram.
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Business Process Diagramming Conventions Process: Decision: Stored Data Yes No Begin with a verb…….. TEAM LEADER SUPERVISOR CLERK/OFFICE SECRETARY TEAM MEMBERS Completes Work Completes TAC Inputs TAC Data in Remote Data Entry Device Reviews/Corrects/Approv es Paper TAC Approves Timesheets Enters TAC Into Computer Reviews and Signs Timesheet With Labor Hours Printed Out by Computer Remote Data Entry?
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The steps of the example business process shown in Figure 9 are as follows: 1. The team leader (and rest of team)
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CASE tools typically include an electronic repository for business process flow diagrams. Database Design As soon as you take various outcome measurements and collect other relevant data, you will need to store it.
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This entails collecting data on outcomes, resources, hardship factors, and outputs. Collecting and Recording Data You will measure performance at the appropriate level of the organization in accordance with your data collection plan.
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These worksheets contain the measures for the outcomes, resources, hardship factors, and outputs. These measures will be used for the performance comparisons.
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Chapter 4: Steps of Customer-Driven Benchmarking 126 The purpose of Worksheet 14 is to record, for each outcome measure, the observed outcomes for each subunit of the benchmarking partner. ♦ At the top of the page, enter – The name of the product or service being benchmarked, – The name of the benchmarking partner organization, – An identification code for the benchmarking partner, – The organizational level of the benchmarking units that participated in the benchmarking activity, – The number of benchmarking units, – The benchmarking agreement number, and – The time period over which performance is measured.
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127 WORKSHEET 14. BENCHMARKING RESULTS -- OUTCOME MEASURES Product/Service: Smooth Pavement____ Name of Partner: Department of Transportation Identification Code: 00031 Organizational Level of Benchmarking Units: County No.
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Chapter 4: Steps of Customer-Driven Benchmarking 128 The purpose of Worksheet 15 is to record for each resource measure the observed resource usage of each subunit of the benchmarking partner. ♦ At the top of the page, enter – The name of the product or service being benchmarked, – The name of the organization that is a benchmarking partner, – The identification code for the benchmarking partner, – The organizational level of the subunits that participated in the benchmarking activity, – The number of benchmarking subunits, – The benchmarking agreement number, and – Time period over which performance is measured.
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129 WORKSHEET 15. BENCHMARKING RESULTS -- RESOURCE MEASURES Product/Service: Smooth Pavement Name of Partner: Department of Transportation Identification Code: 00031 Organizational Level of Benchmarking Units: County No.
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USE MORE THAN ONE WORKSHEET IF NECESSARY. Hardship Factors
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BENCHMARKING RESULTS -- HARDSHIP (UNCONTROLLABLE) FACTORS Product/Service: Smooth Pavement Name of Partner: Department of Transportation Identification Code: 00031 Organizational Level of Benchmarking Units: County No.
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Chapter 4: Steps of Customer-Driven Benchmarking 132 The purpose of Worksheet 17 is to record for each output measure the observed output of each subunit of the benchmarking partner. ♦ At the top of the page, enter – The name of the organization that is a benchmarking partner, – The identification code for the benchmarking partner, – The organizational level of the subunits that participated in the benchmarking activity, – The number of benchmarking subunits, – The benchmarking agreement number, and – Time period over which performance is measured.
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Lane Miles Contract Miles Total Miles 1. Jefferson 190 371 561 2.
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There are many possible approaches to evaluating performance, and this guide describes a few that are useful to maintenance organizations. The guide describes a simple approach to assessing performance and then presents a rigorous procedure capable of simultaneously handing outcomes, inputs, and external factors for large numbers of benchmarking units.
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If you have more than 20 units, visual inspection becomes difficult; if you have benchmarking units numbering higher than 30 -- for example, in the hundreds -- you will need to use mathematical and statistical analysis tools such as the data envelopment analysis discussed below. Assuming you have just a small number of benchmarking units, you can analyze their benchmarking data by going through the following steps: 1.
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For example, higher customer satisfaction ratings are better, but higher resource usage is worse.
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that customers care about, or both. Furthermore, in the best of all worlds, it is desirable that the organizations with the highest customer-oriented outcomes also have the lowest resource usage, have the highest production, and achieve this regardless of the level of hardship.
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Table 4. Performance Measures for 12 Districts District ID Customer Satisfaction Rating Regain Time Labor Cost Equipment Cost Material Cost Total Miles Covered for Season Actual Lane Miles Number of Snow and Ice Events Average Daily VMT A 8.1 12.2 $536,568 $661,478 $899,520 242,060 1,960 95 4,262,352 B 8.1 34.7 $420,765 $437,788 $666,665 214,819 1,809 95 2,315,384 C 7.9 6.4 $422,308 $847,359 $254,430 490,051 3,933 89 3,280,673 D 7.5 6.2 $238,392 $551,179 $669,172 139,991 1,984 72 3,445,186 E 7.5 4.9 $686,286 $862,725 $527,519 141,725 2,072 72 7,908,242 F 7.5 1.09 $580,406 $1,278,141 $632,392 277,679 3,673 63 4,850,026 G 8.2 3.4 $3,426,774 $6,108,419 $3,107,224 398,279 3,751 56 41,892,999 H 7.7 5.6 $519,652 $487,406 $775,949 164,425 1,931 65 4,049,412 I 7.7 5.4 $645,410 $786,760 $477,106 109,395 1,700 65 4,964,813 J 7.7 8.2 $514,695 $851,307 $480,502 251,281 1,931 91 2,914,743 K 7.7 5.7 $457,553 $449,117 $389,594 193,980 1,579 91 2,173,749 L 7.5 43.8 $261,447 $386,734 $203,525 267,262 3,035 74 3,601,587 Outcomes Resources Output Hardship
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♦ Hardship factors – Lane miles -- fewer are better. – Number of snow and ice events -- fewer are better.
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Outcome: Customer Satisfaction Figure 12b. Outcome: Regain Time Figure 12a shows that District G achieved the highest level of customer satisfaction.
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141 Figure 12c shows each district's labor costs. Districts with the lowest costs were D, L, B, and C
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"Total Miles Covered for the Season" equals the total lane miles times the average percent of lane miles covered per storm event, which is then multiplied times the number of events or Material Costs $0 $500,000 $1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000 $3,500,000 A B C D E F G H I J K L Districts Co st s Total Miles Covered for Season 0 100,000 200,000 300,000 400,000 500,000 600,000 A B C D E F G H I J K L Districts M ile s
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Districts A, B, C, J, and K experienced the most snow and ice events. Actual Lane Miles 0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 A B C D E F G H I J K L Districts La ne M ile s District Snow & Ice Events 0 20 40 60 80 100 A B C D E F G H I J K L Districts N um be r o f S no w & Ic e Ev en ts
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Customer satisfaction rating (outcome measure)
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One more step can be taken to reduce the number of measures: divide the average daily VMT by the total resource cost. This allows you to see how many miles are driven for each dollar spent in this area of maintenance; the more miles driven per dollar spent the better.
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Daily VMT/$ by District Cost per Lane Mile by District 0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 A B C D E F G H I J K L Districts Co st p er L an e M ile Daily VMT/$ by Distirct 0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 A B C D E F G H I J K L Districts D ai ly V M T/ $
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and thus spends more on labor, equipment, and material per lane mile than any other district, the number of customers Customer Regain Time Number of District Satisfaction Rating All Service Levels (in hours) Daily VMT/$ Cost/Lane Mile in $ Snow & Ice Events A 8.1 12.2 2 1,070 95 B 8.1 34.7 1.5 843 95 C 7.9 6.4 2.2 388 89 D 7.5 6.2 2.4 735 72 E 7.5 4.9 3.8 1,002 72 F 7.5 10.9 1.9 678 63 G 8.2 3.4 3.3 3,370 56 H 7.7 5.6 2.3 923 65 I 7.7 5.4 2.6 1,123 65 J 7.7 8.2 1.6 956 91 K 7.7 5.7 1.7 821 91 L 7.5 43.8 4.2 281 74 *
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Customer Regain Time Number of District Satisfaction Rating All Service Levels (in hours) Daily VMT/$ Cost/Lane Mile (in $)
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The production process is characterized by decision-making units that employ labor, equipment, and material to provide maintenance activities (e.g., sign repair and snow and ice control) to achieve desirable outcomes (e.g., customer satisfaction, high-quality infrastructure, low accident rates, and minimal travel or delay time)
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Figure 15 provides an example production frontier. For simplicity, assume that there is only one outcome (customer satisfaction)
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One common measure of performance, technical efficiency, can be measured as TE = (efficient input level) /(observed input level)
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Referring back to Figure 16, by comparing DMU C with DMU B, it can be seen that DMU C could have provided an outcome level of 15 given the resource Chapter 4: Steps of Customer-Driven Benchmarking 152 Figure 16. DMU Efficiency Input Output Production Frontier Efficient decision making unit Inefficient decision making unit A C B 4 9 10 15
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is assumed to be the only input. Further assume that the production frontier can be represented algebraically by CS = 10L.
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In particular, the technique of DEA measures relative performance based solely on the observed inputs and outcomes of DMU. Uncontrollable Inputs Production analysis in the public sector often ignores hardship factors.
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Information that can be obtained from DEA -- including performance evaluation, benchmarking, economies of scale, cost efficiency, and environmental harshness -- can be found in the literature on DEA listed in the references at the end of this guide. 155 Figure 17.
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Example 2: DEA This example problem provides a relatively nontechnical discussion of the development of production frontiers using DEA, which handles multiple outputs and inputs. For this example, a basic understanding of algebra and geometry is assumed.
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For example, DMU A is represented by (4, 2) , implying that 4 units of labor are used to provide a customer satisfaction level of 2 units.
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The production frontier is shown in Figure 19. Labor Customer Satisfaction 4 2 .
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Example 2 Production Frontier L CS 4 2 .
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It is currently using 10.5 units of Chapter 4: Steps of Customer-Driven Benchmarking 160 Figure 20. DEA Input-Oriented Projection Step Three: Measuring Input-Oriented Technical Efficiency For this example, the graph of the production frontier can serve as the basis for performance measurement.
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for DMU E is TEE = 15/18 = 0.8333. Finally, consider DMU G, which is using 8 units of labor while achieving a customer satisfaction of 5.
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Using DEA in Customer-Driven Benchmarking of Maintenance To apply DEA to customer-driven benchmarking of road maintenance, you will need specialized software. Commercially available software packages and proprietary benchmarking services, including software, provide suitable analytical tools.
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Identifying Peers Who Are Best Performers To compare maintenance performance of specific products, services, or maintenance activities, numerous organizational units will be cooperating and sharing performance information. Actually, the more organizational units that are cooperating and sharing, the greater the opportunity for any one organizational unit to find practices of other units that will help improve its own performance.
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To start comparing practices, it is best to select a small number of organizations, approximately 2 to 5 of the best performing units. The issue is then for each organizational unit to determine which of the best performing units are best for comparing practices.
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To obtain your initial set of peers for purposes of investigating best practices, select the organizational units with the greatest improvement opportunities based on the performance evaluations of all of the products, services, or maintenance areas that you and your partners have evaluated. You can refine your initial set of peers by screening based on other criteria listed above -- for example, by identifying which of the peer set have inventory quantity and budget levels similar to yours.
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As soon as you know what business processes will be the focus of the best practice investigation, you should prepare the questionnaire and share it with the partners with whom you plan to exchange information. The questionnaire should address the following types of issues: ♦ Work methods -- including the type of labor (skills and training levels)
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167 ♦ Hardship factors -- including weather, terrain, and population density -- that are favorable or unfavorable for the practices. ♦ Cost structures -- the costs associated with each resource needed for the practice(s)
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168 Figure 21. Sample Questionnaire
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The bestperforming peers you have selected need to be contacted to gain a more complete understanding of their practices. Communication can occur using conference calls; electronic information exchanges such as e-mail, groupware, and chat rooms; and video conferences.
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Site visits should only occur if there is strong reason to believe that they will add value and both parties are well prepared. Generally, a pair of visitors is desirable to conduct the site visit because two pairs of eyes and ears help capture accurately what is observed.
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Root Cause Analysis A straightforward and often helpful method of understanding the underlying reasons for performance, root cause analysis employs a diagram such as Figure 22 to identify the main and deeper root causes contributing to an outcome. 171 Example of Site Visit in Maintenance Benchmarking The Kansas City Department of Public Works participated in a municipal public works department–benchmarking program with several other cities in North America in order to achieve the following three goals: 1.
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Chapter 4: Steps of Customer-Driven Benchmarking 172 Figure 22. Root Cause Analysis Using Fishbone Diagram To apply root cause analysis, a group of people knowledgeable about the business process identifies main categories of potential causes leading to an outcome and then dissects the causes further.
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For example, you could make a list of factors contributing to pavement smoothness. If the factor is at play in a particular organization or unit, you would give it a value of 1; otherwise, you would give it a value of 0.
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Design of experiments plays an important role in diagnosing the causes of complex manufacturing problems and other processes.4 You will need expert help to design experiments in an efficient manner in order to root out the factors contributing to outcomes. The MnDOT used an experimental design in constructing a survey instrument to assess the strength of different factors contributing to the value motorists receive from different attributes of roadside vegetation.
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The resource costs can be estimated based upon local conditions for the initiating organization. Estimating the change in outcome levels will be more difficult because the functional relationship between resource levels and outcome levels is unknown and is not easily estimated.
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materials, improved management and information systems, more efficient work reporting, or a combination of the above?
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There will continually be changes in the peer group with which an organization can compare practices. Each organization or unit that embraces customer-driven benchmarking can be confident that from time to time and perhaps frequently, they will be among the best performers.
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Key Terms
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