Value Stream Mapping the Delaware Air Quality Permitting Process

1. Value Stream Mapping the Delaware Air Quality Permitting Process Bob Zimmerman State-EPA Symposium on Environmental Innovation and Results January 23-25, 2006

2. Delaware Value Stream Mapping Project Partners • Delaware Economic Development Office • Delaware Manufacturing Extension Partnership • DNREC Office of the Secretary • DAWM Air Quality Management • General Motors • Daimler Chrysler • CIBA Specialty Chemicals • ILC Dover, Inc. • PPG Industries • DuPont

3. Value Stream Mapping Process Objectives • Improve the permitting process without weakening regulatory requirements. • Capture the experience of those who have to meet the regulatory requirements. • Process redesign activity would be transparent to the public and the regulated community.

4. Value Stream Mapping Process • Why? • Listening to voice of customer • DEDO report on industry clusters to Governor - early 2005 • DNREC asked to identify specific process - AQ construction permitting selected • Stakeholders (Public/ Industry/ DNREC) • Improve permitting process • Reduce processing time/effort • Create greater business certainty • Optimize DNREC’s resources for other functions • Improve environmental quality

5. Perspectives from Delaware’s Business Community • Cost issues due to: • Cumbersome and slow permitting process • No allowance for “green companies” that are proactive and stay in compliance

6. Delaware Value Stream Mapping • For public transparency we created a web page for the DNREC/ DEDO Value Stream Mapping project: • http://www.dnrec.state.de.us/DNREC2000/VSM/Index.htm • All materials are available on the web page

7. History • DNREC / DEDO Value Stream Mapping Process • June 05: Initial Scoping Meeting • July 05: Planning Session • Aug 05: 3 Day Training / Action Plan • Sept 05: 30 Day – Progress/ Plan Review • Oct 05: 60 Day – Progress/ Plan Review • Nov 05: 90 Day – Progress/ Plan Review • Jan ’06: 120 Day – Progress/ Plan Review

8. Mapping the Current State • Created the goal for the session • Defined what was in scope and out of scope • Mapped the current state of the Air Quality Construction Permitting Process.

9. Goal for VSM Project • Develop and implement an air permitting process that results in expeditious issuance of environmentally sound, operationally flexible and achievable permits in a timeframe not to exceed 90 days and ensure requirements are identified clearly prior to submittal reducing re-work in the process to 50%

12. Mapping the Current State • Lessons learned: • Majority of process problems stem from the permit applications! • First pass quality yield was < 1% • Assuming perfect customer input, first pass quality yield was 18% • Re-work was nearly 100%! • Construction permits issued within 180 days

13. Mapping the Current State • Identified opportunities for improvement called “Kaizen Bursts.” “Kaizen” are rapid improvement processes focused on eliminating waste, improving productivity, and achieving continual improvement. • “Kaizen Bursts” were used to help create the Future State.

15. Creating the Future State • Defined our future state – where we wanted to be in one year: • Internal first pass quality yield - 80% • Customer information quality - 80% • Administrative completeness - 100% • Technical completeness - 80% • Re-work less than 50% • Construction permit issued within 90 days

17. Achieving Our Future State • Identified and scheduled specific tasks to accomplish. These tasks included: • create visual tracking boards; • implement a First-In-First-Out system; • create permitting checklists; • seek applicant feedback; • modify our applications to make them more user friendly; • modify application review process; and • collecting new performance metrics.

18. Visual Tracking Board

19. Project Highlights • Surveyed applicants to discuss why they submitted incomplete applications and learned important information. • Reduced our permitting backlog from 199 AQ construction permits on 8/24/2005 to 48 on 1/11/2006. • Implemented a First-In-First-Out system. • Now issuing AQ construction permits within 61 days of receiving a complete application

20. What We Learned from Applicants • Difficult to know which form to complete • Difficult to know where and how to obtain information that is requested • Difficult to know which questions to answer and which ones are not applicable • Applicants would like help with engineering calculations • Applicants would like to know why specific information is requested

21. Important Process Improvements • Future State includes three important changes to the permitting process: • Pre-Submittal Meeting • Administratively Complete Gate • Technically Complete Gate

22. DNREC Value Stream Mapping Air Permitting Process • PLUS: • Top Down Commitment • Cross Functional Communications • Employee Involvement • First Time Quality • Partnership Support • Customer Focus and Communications Future State SEPTEMBER, OCTOBER & NOVEMBER 05’ • MINUS: Reduced Waste in: • Motion • Waiting • Processing • Rework • Lead time Current State Created a permitting process that is environmentally sound, operationally flexible and achievable.

23. Next Steps • We are still working on some of the action items required to implement the process. • We are seeking volunteers (especially our permittees) to participate in the permit application redesign. • We are reviewing/revising the metrics for permit processing.

24. Schedule • Feb 06 - Complete drafts of all VSM action items • Mar-April 06 - Train regulated community on new processes and documentation • May-June 06 – Debug new processes • July 06 – complete full implementation of new processes

25. For more information: • Robert J. Zimmerman Office of the Secretary, Director of External Affairs Robert.Zimmerman@state.de.us 302-739-9000 • Ali Mirzakhalili Program Administrator, Air Quality Management Ali.Mirzakhalili@state.de.us 302-739-9400 • Amy Mann Environmental Engineer III, AQM Amy.Mann@state.de.us 302-323-4542

26. Lessons Learned by Nebraska, Michigan and Delaware • Worth the effort • Carefully select the situation or process • There is a lot more waste than you realize • Eliminating waste doesn’t mean eliminating people • Goal-setting is critical • Communications (before, during and after) • Active and visible management support • Be prepared for resource issues • Follow- thru essential to keep on track