Agility in the Public Sector: An Examination of the Minas Gerais Executive

Throughout my tenure as a public servant, I consistently sought ways to enhance workflow efficiency. In 2021, my exploration of Agility methodologies led to a comprehensive case study born from a desire to implement and test various tools and practices.

Context: IPSEMG

IPSEMG, the Instituto de Previdência dos Servidores do Estado de Minas Gerais, operates as an agency under the State Secretariat for Planning and Management (SEPLAG). It provides medical, hospital, pharmaceutical, dental, and social assistance services to its beneficiaries, primarily comprising public servants and civilians in the state of Minas Gerais. Additionally, it administers its pension scheme.

From 2019 to March 2022, I served at NEPE, the Center for Economic Studies and Research, an informal unit within the IPSEMG Health Directorate. NEPE's responsibilities included conducting economic studies for contract renewals of services, medicines, and medical materials essential for the Institute's operations. Furthermore, NEPE was tasked with preparing economic and financial feasibility studies before determining the contracting modality.

In 2021, NEPE handled a workload comprising 216 contracts and 37 requests for preliminary studies, collectively referred to as "processes." These processes were managed digitally through the SEI (Electronic Information System), a document and electronic process management tool developed by the Federal Regional Court of the 4th Region (TRF4) to enhance administrative efficiency.

My duties encompassed analyzing, prioritizing, and delegating activities within the team. This included managing the backlog, prioritizing demands, assigning processes, preparing financial-economic studies, facilitating stakeholder meetings, overseeing rites focused on achieving results, and monitoring metrics.

Visual Management

The characteristics of the NEPE team - self-management, autonomy, and independence within a highly collaborative environment - aligned seamlessly with the principles of Agility. This alignment greatly facilitated the gradual implementation of Agile practices.

Backlog management was conducted using an online spreadsheet. In this process, I received demands, assessed their requirements, and allocated them to team members accordingly. While the attribution of processes may appear contrary to Agile principles, it holds significant value in the public service realm. This mechanism effectively delineates the scope of action, promotes equality, and acknowledges the unique skills and expertise of each team member.

Drawing from an analysis of the primary phases of the contract renewal study, I organized them into columns within a Kanban board on Trello. This structure enabled real-time visibility of process statuses, allowing technicians to seamlessly transition between tasks without context switching. Additionally, it facilitated efficient monitoring of work progress.

Phases:

1. Contract history
2. Contractor's Statement
3. Price Record Search, Best Price Database and Auctions
4. Market quotes
5. Technical validation (of proposals resulting from research 3. and 4.)
6. Technical Note (product prepared by the technician, study)
7. Review of the Technical Note by the supervisor at the Center (includes appropriate signatures)
8. Completed (submission to the Contracts Department)

Metrics

Performance metrics are crucial not only for internal team assessment but also for guiding and refining strategies aimed at continuous process improvement.

The data within the Process Map Spreadsheet (NEPE, 2021) facilitated the implementation of key business metrics that underscored the significance of the Center. These metrics include: 1. Lead time, 2. Throughput, 3. Deadline compliance, and 4. Economic efficiency.

Lead time

Lead time is defined as the duration between the initiation of a demand and its fulfillment or completion. In the context of NEPE, this metric encompasses the period from when a process is assigned to a technician until it is forwarded to the Contracts Department for further processing, upon completion within NEPE. Lead time serves as an indicator of workflow efficiency.

Contract renewals within the Public Administration are subject to strict deadlines. NEPE typically receives such demands 90 days prior to the contract's expiration and is required to finalize them 30 days before expiration. Hence, theoretically, NEPE has a 60-day window to complete these tasks.

It is observed that NEPE began 2021 with high numbers, which gradually decreased and stabilized from July onward, in adherence to internal protocols. During this period, the average delivery time remained consistently between 30 to 38 days.

Throughput

Throughput, also known as the average flow index, quantifies the team's delivery capacity over a specific timeframe, indicating how many processes NEPE completes within a month.

In Public Administration, apart from urgent demands, processes with imminent deadlines must be prioritized for timely completion. Consequently, the team's notable characteristic lies in its adaptability to handle tasks exceeding its capacity swiftly and with high quality.

NEPE's monthly delivery in 2021 varied from 12 (minimum) to 30 processes in March, with an average of 19.6 processes per month. The consistency in deliveries is depicted by the blue trend line.

It's important to note that this metric solely evaluates monthly deliveries, disregarding expiration dates. Additionally, NEPE's workload fluctuates due to variable demands beyond its control, such as the establishment of new contracts monthly and delays in receiving deadlines from other sectors.

The outcomes of NEPE's efforts encompass contract renewals, terminations (by contractor decision or due to lower market prices), and other studies, including quantitative adjustments, rebalancing, and item exclusions—all compliant with legislation.

From January to November 2021, 158 out of the 216 contracts received were renewed, accounting for 73% of the total. This significant rate of contract renewals, coupled with the savings metrics achieved through these renewals, underscores the team's commitment to efficient negotiation practices. On average, only 18% of contracts were terminated during this period, totaling 40 terminations.

Deadline Compliance

In an effort to gauge the frequency of delays in completing processes, focusing solely on the NEPE delivery deadline set at 30 days before the end of the term, it becomes apparent that the majority of deliveries were delayed from January to May.

These delays were primarily attributed to factors beyond NEPE's control, as the receipt of processes was significantly delayed until June. It wasn't until July, prompted by demonstrations from the Center and the implementation of internal guidelines, that deliveries resumed in a timely manner. It's worth noting that deadline compliance directly influences lead time.

From January to May, deliveries were predominantly delayed. However, starting from June, the rate of delays decreased from 4.76% to 25%. The monthly average revealed that 36.79% of deliveries were delayed, while 63.21% were completed on time.

Economy efficiency

Public Administration is guided by fundamental principles outlined in Article 37 of the Federal Constitution of 1988, including Legality, Impersonality, Morality, Publicity, and Efficiency.

Efficiency improvements primarily focus on optimizing processes. An efficient process is one where resources are utilized optimally to achieve a specific purpose.

At NEPE, efficiency is founded on two principles: process optimization and savings to the public treasury. Process optimization involves leveraging team expertise to enhance study preparation, thus reducing lead time and ensuring the timely delivery of high-quality studies. Savings to the treasury are realized through negotiations between technicians and contractors, demonstrating effective communication, determination, and strategic planning.

Economy is achieved through contract renewals with adjustments lower than those specified in the original contract. These savings stem from various sources, including adjustments lower than inflation, negotiations to defer adjustments during renewal, and reductions in contracted values identified through market research and negotiations with suppliers.

The measured values vary monthly, with an average of R$239,426.54 per month and a cumulative amount of R$2,873,118.51. The team in 2021 comprised 10 technicians, including both career employees and interns.

In the team savings ranking, a practice aimed at recognizing individual and institutional achievements, I secured the second position by saving R$1,119,338.66 through the negotiation of 43 contracts. This amount represents 38.9% of the total savings and 20% of the total contracts negotiated.

Rites

The year 2021 witnessed a shift towards remotely working, a mode where employees operated remotely. This transition prompted the implementation of rituals aimed at fostering team evolution, particularly in mastering online tools and adapting to remote work dynamics.

These rituals focused on achieving results and were carried out through two main avenues:

a. Monthly Retrospectives and Health Check Practice

Objectives: To strategize improvements, evaluate successes and challenges, cultivate team harmony, empower team members, and facilitate peer learning.

b. Good/Bad/Ideas/Actions Practice

During this exercise, technicians highlighted aspects worthy of continuation or commendation, areas needing improvement, proposed ideas, and identified actionable steps for implementation.

Final considerations

Agility has demonstrated its versatility across various contexts beyond technology, and its core principles have revolutionized individuals' mindsets more than just tools and methodologies.

In the case study above, the team's adeptness facilitated the successful implementation of practices in an iterative and incremental manner. The key benefits can be summarized as follows:

1. Visual management enhanced clarity and accessibility to processes and their respective phases.
2. Metrics provided tangible insights into the work, facilitating timely decision-making and broadening the scope of planning. Additionally, they underscored the significance of the Center's contributions.
3. Results-focused rituals fostered empowerment, team cohesion, and psychological well-being, contributing to a positive work environment.
4. Skills were enhanced both individually and collectively, encompassing adaptation, flexibility, communication, collaboration, systemic thinking, a sense of ownership, and continuous peer learning.

I extend my gratitude to you, dear reader, for accompanying me on this journey.

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References:

Constitution of the Federative Republic of Brazil of 1988. Available at: https://www.planalto.gov.br/ccivil_03/constituicao/constituicaocompilado.htm