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Do Government Agencies Have Customers or Hostages? - GoLeanSixSigma.com

It’s easy for a private sector company to be highly customer-focused. The customer is clearly identified as the user and is almost always paying for the product or service. In government, identifying the customer is not always easy.

Who is the customer? The taxpayer, the person paying for the service or the user? Or is the customer an oversight group like a city council? There are so many “voices” in government, it’s hard to know which voice to listen to or which voice is most important.

Understanding who your customers are and what is important to them is critical for all organizations, including government. In order to help government agencies figure out who their customer are let’s define the terms, “Customers,” “Stakeholders” and “Process Partners.”

Definitions of Terms

Customers use the product or service. This can mean that the customer goes through the process (aka: waiting in line at the DMV).

Think about the Department of Motor Vehicles (DMV). Customers want their driver’s licenses or identification cards. They may submit requests by mail, online or visit the agency in person.

Customers receive a primary output from the process.

Customers receive a primary output from the process. In this case, it’s the ID or driver’s license. Typically customers are at the very end of any process. The thing, the product or service, is no longer pushed to anyone else anywhere.

Stakeholders do not use the product or service. They typically do not go through the process. However, they have a vested interest in how the process runs or how the product or service is performing. A few examples of where government stakeholders come from include Fiscal Compliance, Code Enforcement or a City Council. These groups typically provide oversight to many processes and have a vested interest in things running a certain way.

Process Partners are entities, agencies or departments that work together to provide a product or service to a customer. They can be organizations that are upstream or downstream from the process in question. Process partners are in the process collaborating with others to deliver the end product or service to the customer. They provide information, do the work and produce documents or materials that eventually reach the customers. Process partners might think they are the customer of another unit or agency, but in reality, they are process partners.

Traditionally, in government, stakeholders have the most significant voice. Because of this, many government processes are designed for stakeholders, not customers. Government is notorious for ignoring customer requirements, which is why there are so many frustrated customers.

Government is notorious for ignoring customer requirements, which is why there are so many frustrated customers.

Next Steps

Government agencies often struggle with identifying their customers. Some argue that government organizations don’t have customers – they have hostages.

Since government customers don’t get to choose their provider, they are stuck with the government agency that owns the process. In order to improve, government agencies must satisfy both the stakeholders and the customers of their processes. In order to provide clarity around who their customers are, government agencies must first identify the customers and stakeholders for each individual process. This is a critical first step for building a process-focused organization.

The second step is to change the traditional perspective of organizations. This benefits not just government organizations but the private sector too. We need to move away from the vertical and adopt a horizontal perspective. The vertical perspective takes the organizational chart view; who reports to whom and in what department. This limits our ability to see the end-to-end process and makes it harder to focus on the customer. Vertical perspectives reinforce the voice of the unit, section or department rather than the voice of the customer.

Vertical perspectives reinforce the voice of the unit, section or department rather than the voice of the customer.

In contrast, the horizontal perspective is the process view of the organization. Processes flow horizontally in across units, sections and teams. Emphasizing this view helps employees see how the process flows through the organization all the way to the customer.

Organizational Charts vs. Value Streams

Below, on the left, is an organizational chart for Financial Business Operations Division (FBOD), a government organization in King County. This chart shows the vertical view of the organization and functional reporting structure. On the right is the same organization, but now displayed horizontally by Value Stream or core process. There are five main Value Streams in this organization:

  1. Budget to Report
  2. Procure to Pay
  3. Hire to Retire
  4. Billing to Cash
  5. Assess to Collect

FBOD - Organization Views

The horizontal view highlights the process, instead of the people. This is an important view to emphasize. Without a clear view of horizontal processes, employees often make decisions that overcomplicate process performance.

For example, the graphic above on the right shows gray, green and orange boxes. The orange boxes indicate shared ownership between FBOD and other agencies. These orange boxes are areas in the process requiring cross collaboration between different agencies. The grey boxes highlight which steps in the process are owned by a completely different government agency.

Someone, at some point in the past, decided to break up the Value Stream and assign ownership of different process steps to separate agencies. What does that separation do to the efficiency of a process? It is much more difficult to streamline a process if the steps are owned by completely different agencies.

Because separate agencies own different steps in the Value Stream, there are multiple hand-offs in the process.

For one, it forces an additional hand-off into the process. It also creates a barrier to flow. Look at the “Procure to Pay” Value Stream shown above. Because separate agencies own different steps in the Value Stream, there are multiple hand-offs in the process. If there was a horizontal view of the process prior to these decisions, the outcomes may have been different. Ideally, one agency would own most, if not all of the Value Stream. FBOD has done some really good work to help understand the Value Streams and the horizontal view of their processes in order to enhance customer focus.

Key Customer Questions

Once the Value Streams are identified, it’s time to identify the core processes within each Value Stream. A core process is the next level of detail in the horizontal process view. The key question at this stage is, “What core processes make up this Value Stream?” In order to create a stronger customer focus, there are some key customer questions that every organization should strive to answer:

“What core processes make up this Value Stream?”

  1. What are our core processes?
  2. Who are our customers (by process)?
  3. What do our customers care about (process measures)?
  4. How are we measuring what customers care about?
  5. How are we closing the gap between actual performance and desired performance?

The graphics below give an example of some of the work that will answer questions 1-3. Under each process step in the Value Stream, the core processes are listed.

FBOD - Value Stream View

Once the core processes are identified, customers, stakeholders and their requirements can be identified by core process. This type of work helps government employees build a better understanding of the horizontal process view, get a better sense of who customers and stakeholders are for each process as well as determine what customers and stakeholders care about. This type of mapping drives process and customer focus in any organization. Moving forward, core process maps can be used to identify process measures, process improvements and prioritize work.

Procure To Pay - Value Stream

Elevates the process view, the customer and stakeholder requirements along with the process improvements that will close the gap between actual versus desired performance.

Once an organization has answered questions 1 through 3 , they can begin to work on questions 4 and 5. This is where there’s an opportunity to develop Visual Management. Visual Management elevates the process view, the customer and stakeholder requirements along with the process improvements that will close the gap between actual versus desired performance.

A:R Processes

The boards can be used daily or weekly to conduct team huddles where groups discuss status and progress. The boards help make the horizontal process visible as well as sharpening focus on customer requirements and the process improvements to close the gaps. Staff working in the process should help design and create the boards since they will likely huddle around the board with their supervisor.

This critical tool helps government employees stay focused on the horizontal flow of the processes, the process outputs as well as customer and stakeholder requirements.

This process requires effort but there are helpful roadmaps and tools available to make it happen. Once government agencies follow these simple steps, customers of government can release the feeling of being hostages.

Do you work for a government agency or have you been a customer of a government agency that could use some process improvement? Please share your experience in the comments below!

Tracy O'Rourke

Tracy is a Managing Partner & Executive Advisor at GoLeanSixSigma.com. She is also a Lean Six Sigma Green Belt Instructor at University of California San Diego and teaches in San Diego State University’s Lean Enterprise Program. For almost 20 years, she has helped leading organizations like Washington State, Charles Schwab and GE build problem-solving muscles.