Portland General Electric

Case Study

A Lean Journey Leads to Higher Efficiency While Maintaining Effectiveness

For more than 125 years, Portland General Electric (PGE) has provided safe, reliable and responsibly generated power to 1.8 million homes throughout the greater-Portland area. For decades, utilities like PGE operated in a competition-free environment under regulated monopolies. The landscape has changed—competitors have entered the marketplace.

Baselining and Aligning Organizational Values
Coraggio was first hired to work with the PGE executive team to evaluate and refine its corporate strategy in response to this evolving marketplace. By 2010 several divisions were focusing on implementing various parts of the organization’s long-term direction.

The first division to begin the Lean journey was Human Resources (HR). HR had completed a benchmarking study, which showed that while it was world-class in its effectiveness, there were opportunities to improve efficiencies. Coraggio assisted HR in developing its strategic plan, which included both definition and alignment on organizational values and the launch of a formal Lean transformation. The goal of the transformation was to increase key process efficiency over the next three years and to begin the long-term process of creating a culture of Lean thinkers.

Generating Lean Strategies to Improve Efficiencies
Our challenge was to help PGE leadership improve the HR division’s efficiency while maintaining its effectiveness. Lean was an ideal strategy to utilize given its focus on the customer, value and respect for individuals.

Also important was the need to understand the leadership and organizational culture that had developed over time and then help it evolve to one that willingly embraced change and understood how to think about their work differently.

With strong support from the HR executive who inspired a shared vision for Lean’s benefits for both HR and all of PGE, Coraggio developed a multi-year Lean implementation plan with the goals of:

  • Improving the efficiency of the division before the next benchmarking review to be conducted in 2014
  • Realizing year-over-year cost savings for core processes
  • Establishing cultural roots for a continuous improvement way of thinking and doing

Powering PGE’s Lean Journey Through a Multi-Year Roadmap
In partnership with PGE leadership, the Coraggio team deployed in all aspects of the Lean rollout, including: defining the Lean strategy, designing a multi-year roadmap and resourcing plan, training internal Process Leads, and facilitating or coaching more than ten process improvement teams. Additionally, a key effort was aligning and equipping leadership on their role as Lean leaders so they could consistently and effectively model the way. Coraggio equipped Process Leads in an apprenticeship-type program that combined classroom teaching, role-playing and testing, with co-facilitation and mentoring during process improvement projects.

Now, more than two years into its Lean journey, HR has implemented Lean in all of its core processes and achieved year- over-year cost reductions for the division while maintaining its world-class level of effectiveness. In the processes Coraggio has facilitated for PGE, process improvement teams have delivered no less than an average 19% reduction in process time while maintaining or improving outcomes for customers.

“ As a result of our work with Coraggio, Lean thinking is now a common-sense approach to continuous efficiency improvement that has empowered my employees to identify inefficiencies in the work, take ownership and find solutions. ”

— Tammy Neitzke, Director Corporate Planning and Performance Management