Client: Texas Department of Transportation (TxDOT)
Background: A total number of 25,145,000 people use the Texas transportation system of 193,000 miles of roads. TxDOT has a $9 billion a year budget and 12,150 employees.
Business Problem: In 2009 and 2010, TxDOT leadership, with the assistance of an independent audit firm and other outside experts, conducted a top-down review of TxDOT management practices and its organization, with the objective of modernizing the agency. The results of the review were published in early 2011 and included 78 recommendations for change. In June 2011, TxDOT engaged Kaeppel Consulting as their change management agent.
The projections are that the State of Texas will have a deficit of $380 billion over the next 20 years to maintain and develop the transportation system. The 30 year old transportation system was designed to last 20 years, and the amount of maintenance required is beyond the forecast of revenues from taxes and federal programs. Also, with 1,000 people moving into the state of Texas every week, the congestion index will continue to grow. The current level of funding over the next 20 years can only slow the growth of the congestion index; it is not enough to reduce congestion with new roads or bridges. The past leadership team, strategic plans, business model and processes at TxDOT were inadequate to meet these needs.
Approach and Solution:
Kaeppel Consulting and TxDOT’s Modernization Leadership Team (MLT) worked together to understand, prioritize, and package the 78 recommendations into over 40 specific projects as part of the agency’s modernization initiative. An important part of the change methodology being used for this initiative includes establishing a governance structure to control the method and pace of implementing these changes. The Kaeppel Consulting team performs as trusted advisors to the Executive Director and his leadership team.
We have been leading the projects to modernize TxDOT. The first strategic project in this effort was to develop a new Mission, Values, Goals and Objectives for the Agency. In doing this, we assessed the strategic challenges of the agency for the next 20 years as we developed the goals of the agency. TxDOT also finances road projects for other government agencies. They have $20 billion in debt, and they loan money to municipalities for local projects. This modernization program is designed to ensure that TxDOT adopts industry best practices, to lean out their existing processes, and to develop a new leadership team with a new Strategic Plan. We are using Change Management, LEAN, Six Sigma and Project Management methods to improve TxDOT through these 40 projects. We are also re-organizing and changing accountability to achieve the strategic objectives of the agency. The final organization changes were completed May 1, 2012, and the contract has been extended for additional implementation assistance.