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HomeMy WebLinkAboutStaff Report 2591 City of Palo Alto (ID # 2591) City Council Staff Report Report Type: Special Orders of the Day Meeting Date: 3/5/2012 March 05, 2012 Page 1 of 1 (ID # 2591) Summary Title: Utilities Organizational Assessment Presentation Title: Presentation From SAIC Energy, Environment & Infrastructure Regarding Utilities Organizational Assessment From: City Manager Lead Department: Administrative Services Recommendation Staff recommends Council listen to a brief presentation from SAIC Energy, Environment & Infrastructure, LLC (SAIC) regarding the work they have started on the Utility Organizational Assessment of the Palo Alto Utilities Department. Executive Summary The City Council previously approved February 6, 2012 CMR #2421. This CMR authorized the City Manager to enter into a contract with SAIC. Background and Discussion SAIC has commenced work on the above referenced assessment. They have provided an attachment which describes SAIC and provides information on some of the tools and techniques they are using to do the assessment work. SAIC will give a brief presentation and then answer any questions the City Council may have. Attachments: Attachment A: Palo Alto City Council Slides March 5, 2012, CMR #2591 (PPTX) Prepared By: Rob Braulik, Director of Office of Management and Budget Department Head: Lalo Perez, Director City Manager Approval: ____________________________________ James Keene, City Manager NATIONAL SECURITY • ENERGY & ENVIRONMENT • HEALTH • CYBERSECURITY © SAIC. All rights reserved. Utilities Department Organizational Assessment City of Palo Alto City Council Presentation March 2012 Attachment A Agenda SAIC Project Team Similar Engagements Innovative Assessment Tools Project Timeline Conclusion & Questions SAIC.com © SAIC. All rights reserved. Who Is SAIC? 3 •Science Applications International Corporation (SAIC), is a FORTUNE 500® company with approximately 41,000 employees located in 450 offices worldwide, generating $11.1 billion revenue in FY 2011. •The 2009 acquisition of R.W.Beck by SAIC created a firm with an unparalleled pool of talent and resources to deliver complete integrated solutions to utilities. •Organized within SAIC’s Energy Environment & Infrastructure division, these consulting resources have more than 25 years of experience in conducting organizational assessments for various electric, water, wastewater, and natural gas utilities throughout the country. •SAIC’s local presence includes offices in Oakland, Sacramento, and San Diego. Our proposed project manager, Tom Jensen, lives and works in Oakland, while our External Environment Task Leader, Steve Rupp, is in Sacramento. In addition to our proposed project team, we have hundreds of professionals who work day-to- day with utilities. SAIC.com © SAIC. All rights reserved. Introduction to Project Team 4 Similar Engagements SAIC Project Team Similar Engagements Innovative Assessment Tools Project Timeline Conclusion & Questions SAIC.com © SAIC. All rights reserved. Brownsville Public Utilities Board Management & Organizational Assessment •Brownsville Public Utilities (BPUB) is a municipally owned water, wastewater & electric utility in Brownsville, TX governed by a Board of Directors with approximately 50,000 customers. •Purpose: Conduct objective assessment of the organizational structure, strategic & business planning, financial management, operations & maintenance, & overall effectiveness of the utilities. •Highlights: •Using Integrated Systems Approach the assessment resulted in over 100 recommendations related to: •Governance •Planning •Organizational structure & staffing •Financial services & rate design •Water & wastewater services •Electric services •Corporate support services 6 SAIC.com © SAIC. All rights reserved. BPUB Primary Issues & Recommendations Four Primary Issues (PI) & Recommendations (R) were given top priority in the final report •PI 1: Policies for the Board of Directors are not Established & Understood •R: Board policy statements should be developed •PI 2: BPUB does not exhibit a “Planning Culture” •R: Update Strategic Plan •R: Review items that only exceed budget, once approved by Board •R: Involve all employees in planning process •PI 3: An alternate organizational structure is needed •R: Implement proposed organizational structure to more effectively & efficiently manage core functions •PI 4: Water & wastewater utility staffing challenges may create safety issues •R: Assign additional staff to treatment plants •R: Hire/cross-train electrician to serve water & wastewater facilities •R: Hire additional licensed professional engineer to assist in project design & construction. 7 SAIC.com © SAIC. All rights reserved. Lafayette Utilities Systems Organizational Assessment •Lafayette Utilities System (LUS) is a municipally owned utility that provides water, wastewater, electric & fiber services to approximately 60,000 customers in Lafayette, LA. •SAIC has conducted various organizational assessments for LUS over the last 15 years. Examples include assessment for the Civil Engineering & the Power Production Division •Purpose: Conduct objective assessment of the organizational structure, planning culture, operations & maintenance, & overall effectiveness of the divisions. •Assessment resulted in recommendations related to: •Planning •Organizational structure & staffing •Processes 8 SAIC.com © SAIC. All rights reserved. LUS Civil Engineering Division Org Assessment Issues & Recommendations Issues (I) & Recommendations (R) found in LUS report Section 1 •I: Strategic vision & priorities should be established •R: Facilitate a strategic planning process •I: Organizational structure does not support core functions •R: Reorganize division to focus on core areas •I: Insufficient & inadequate planning tools create inefficiencies •R: Implement planning processes & tools 9 SAIC.com © SAIC. All rights reserved. LUS Power Plant Division Org Assessment Issues & Recommendations Issues (I) & Recommendations (R) found in LUS report Section 2 •I: The span of control of Superintendent is very broad •R: Reduce span of control by creating supervisory level •I: Power Plant division is not adequately staffed •R: Pay scales need to be reviewed to attract & maintain qualified personnel •I: Increased costs due to outsourcing & skilled craft augmentation contracts •R: Aggressive efforts to staff vacant positions & reduce dependency on external contractors 10 SAIC.com © SAIC. All rights reserved. Pasadena Water and Power Electric Master Plan & Staffing Analysis •Pasadena Water and Power (PWP) is municipal utility serving 55,000 electric and 33,000 water customers in Pasadena, CA. •Purpose: Conduct objective assessment of the current electrical system, including an organization and staffing analysis, to develop a comprehensive plan for the future. •Highlights: •SAIC developed a Master Plan for PWP which included organization and staffing recommendations. •SAIC developed a Workload Forecasting Tool which was provided to PWP to aid in personnel resources management. 11 SAIC.com © SAIC. All rights reserved. Fortis Turks & Caicos Islands (formerly PPC) Organizational Assessment •Fortis Turks & Caicos Islands (Fortis TCI), formerly PPC, is an investor-owned electric utility located in Providenciales, Turks & Caicos Islands with approximately 10,000 customers. •Purpose: Conduct objective assessment of the utility to determine how to improve organizational effectiveness & efficiency. •Highlights: •Using Integrated Systems Approach the assessment resulted in recommendations related to: •Strategic planning •Cultural challenges •Organizational structure & staffing •Leadership development & succession planning 12 Innovative Assessment Tools SAIC Project Team Similar Engagements Innovative Assessment Tools -A “Systems” Approach -Cultural Transformation -Workload Forecasting Project Timeline Conclusion & Questions SAIC.com © SAIC. All rights reserved. An Approach that Looks at Organizations as “A System.” Greater value to the Utility in using a holistic view. 1414 Strategic Plan Organizational Structure & Processes Personnel Skills & Capabilities Cost Requirements & Structure Cultural Flexibility Optimize Service Delivery SAIC.com © SAIC. All rights reserved. Cultural Transformation Tool (CTT) •Understanding an organization’s current culture, and the values that drive that culture, is critical in developing plans and initiatives that will lead to attainable improvements. •The tool SAIC uses to conduct a cultural assessment is a powerful instrument that describes corporate cultures by identifying the core values that exist within each functional area of the organization. It provides a framework for understanding how the individuals, teams and organizations develop and grow and provides insight into how to align an organization’s culture. •The CTT assessment tools are based on the Seven Levels of Consciousness model. 15 SAIC.com © SAIC. All rights reserved. Seven Levels of Organizational Consciousness Positive Focus /Excessive Focus SERVICE MAKING A DIFFERENCE INTERNAL COHESION TRANSFORMATION SELF-ESTEEM RELATIONSHIP SURVIVAL SERVICE TO HUMANITY Long-term perspective. Future generations. Ethics.. DEVELOPMENT OF CORPORATE COMMUNITYPositive spirit. Creativity. Honesty. Shared vision and values. CONTINUOUS RENEWAL Innovation. Personal Growth. Teamwork.Organizational growth through employee participation. BEING THE BEST. BEST PRACTICEProductivity, efficiency, quality, systems and processes. Bureaucracy. Complacency. RELATIONSHIPS THAT SUPPORT CORPORATE NEEDSOpen communication. Customer satisfaction. Respect. Manipulation. Blame. PURSUIT OF PROFIT & SHAREHOLDER VALUEFinancial stability. Employee health and safety. Exploitation. Over-control. Level 7 Level 6 Level 3 Level 2 Level 1 Level 5 Level 4 COLLABORATION WITH CUSTOMERS & THE LOCAL COMMUNITYStrategic alliances. Employee fulfillment. Environmental awareness. 16 SAIC.com © SAIC. All rights reserved. PPC: Group (80) Level 7 Level 6 Level 5 Level 4 Level 3 Level 2 Level 1 Personal Values Current Culture Values Desired Culture Values IRS (P)= 6-4-0 | IRS (L)= 0-0-0 IROS (P)= 0-1-7-2 | IROS (L)= 0-0-0-0 IROS (P)= 2-5-6-0 | IROS (L)= 0-0-0-0 Matches PV -CC 1CC -DC 6PV -DC 5 Health Index (PL) PV: 10-0CC: 10-0DC: 13-0 1. accountability 40 4(R) 2. honesty 38 5(I) 3. commitment 27 5(I) 4. caring 23 2(R) 5. continuous learning 23 4(I) 6. ambition 21 3(I) 7. performance 21 3(I) 8. positive attitude 21 5(I) 9. respect 21 2(R) 10. reliability 20 3(R) Black Underline = PV & CC Orange = CC & DC P = Positive L = Potentially Limiting I = Individual O = Organizational Orange = PV, CC & DC Blue = PV & DC (white circle)R = Relationship S = Societal 1. community involvement 35 6(S) 2. customer satisfaction 34 2(O) 3. cost management 29 3(O) 4. safety 26 1(O) 5. continuous improvement 24 4(O) 6. accountability 18 4(R) 7. being the best 18 3(O) 8. leadership development 18 6(O) 9. long-term perspective 18 7(O) 10. making a difference 18 6(S) 1. accountability 43 4(R) 2. teamwork 36 4(R) 3. customer satisfaction 31 2(O) 4. continuous improvement 23 4(O) 5. leadership development 23 6(O) 6. open communication 22 2(R) 7. cost management 21 3(O) 8. coaching/ mentoring 20 6(R) 9. reliability 19 3(R) 10. being the best 16 3(O) 11. commitment 16 5(I) 12. continuous learning 16 4(O) 13. positive attitude 16 5(I) Values Plot Copyright 2011 Barrett Values Centre February 2011 SAIC.com © SAIC. All rights reserved. Current Strengths Key Issues Moving Forward Personal Values: •Take ownership of actions & demonstrating dedication •Building relationships based on authenticity •An upbeat & determined approach to expanding knowledge & skills to be effective •Top Value: Accountability Current Culture: •Participating in the community & having positive impact •Attention to the bottom line & creating secure work environment where employees take ownership of their actions •Being leaders in the industry •Top Value: Community Involvement •Entropy is slightly elevated at 13% •No potentially limiting values; however some issues beneath the surface may be cause for frustration: •Employees feel stifled by rigid systems/processes & lack of communication •May be working against each other at times due to lack of empowerment & uncertainty about the future •No values at Level 5:Internal Cohesion: May be a gap, covered or new area for development Personal Values to Desired Culture: •Reliability, commitment, continuous learning, positive attitude •Suggests employees desire greater sense of satisfaction & connection with their workplace Current to Desired Culture: •Accountability, customer satisfaction, continuous improvement, leadership development, cost management, being the best •Suggest employees have confidence in the direction of PPC •Values concentrated in Level 4 – Transformation –suggest desire for more energy directed to employee participation & development Desired Culture: •New values indicate that employees want to strengthen the way they work together: •Opportunities to work together & learn from each other •Take ownership of their actions •Establish high standards & principles Cultural Assessment Summary –An Example 18 SAIC.com © SAIC. All rights reserved. Cultural Assessment Recommendations –from recently completed project •Develop internal communication plan to share results of assessment. •Define the key processes & systems to focus on in the next year. Develop specific actions and programs that will foster changes. •Examine new values desired to determine meaning & associated behaviors. •Discuss how the Utility can continue to live the values carried from Current to Desired Culture. •Consider the Values Jump and determine significance. •Determine & define what values the Utility wants to espouse. 19 SAIC.com © SAIC. All rights reserved. Workload Forecasting Tool An Excel© spreadsheet based tool developed by SAIC that: •Provides a quantitative assessment of workload and staffing requirements •Allows management to understand the work that needs to get done and resources required to perform that work in the required timeframe •Allows quantification of resource needs to help solve hiring and outsourcing decisions •Includes templates for estimating resource needs for operating, maintenance and capital projects 20 SAIC.com © SAIC. All rights reserved. Workload Forecasting Tool, cont. •SAIC will evaluate CPAU’s existing staffing levels for field construction work, project management and engineering work to determine how time is allocated between administrative, O&M, customer projects and capital improvement projects. 21 Allocation Hours/Year Task Owner Task Name Time Allocated Hours Per Year MGT & Admin Operations/ Maintenance Customer Projects CIP MGT & Admin O&M Customer Capital Projects Capital Replacement & Improvements Chen “As Built” drawing revisions & updating 10 hrs/wk 500 30%40%30%0 150 200 150 Chen Drawing for new project of underground utility district 10 hrs/wk 500 50%50%0 0 0 500 Chen Another work assigned 5 hr/wk 250 20%40%40%0 50 100 100 Moeis Material specifications 3 hrs/day 666 100%0 666 0 0 Moeis Material inventory 1 hr/day 222 50%50%0 222 0 0 Moeis Underground utility districts 2 hrs/day 444 100%0 0 0 444 SAIC.com © SAIC. All rights reserved. Workload Forecasting Tool, cont. •SAIC will assist CPAU in prioritization of proposed projects to determine schedules and associated FTE requirements 22 SAIC.com © SAIC. All rights reserved. Workload Forecasting Tool, cont. •SAIC will assist CPAU in evaluating the hours currently spent to support each function compared to the hours required to meet budget projections and the impact of levelizing, expanding and/or outsourcing resources. 23 Project Timeline SAIC Project Team Similar Engagements Innovative Assessment Tools Project Timeline Conclusion & Questions SAIC.com © SAIC. All rights reserved. Project Timeline 25 Conclusion & Questions SAIC Project Team Similar Engagements Innovative Assessment Tools Project Timeline Conclusion & Questions SAIC.com © SAIC. All rights reserved. 2727 Why Select SAIC? Utility Experts Innovative Approach to Organizational Assessments Experience with Multi- Service Utilities Local Presence & Knowledge To Optimize Service Delivery at the City of Palo Alto Questions