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Establishing an accountability management system in the Palm Bay Utilities Department: the Utilities Department for the City of Palm Bay, Florida, uses a performance-based management framework in its efforts to becaome a world-class utility.

The City of Palm Bay, Florida, developed a 15-year strategic plan in early 2007, and each department developed supporting strategic plans. A strategic goal of the Utilities Department was to become a "world-class utility," and one of several organizational objectives was to be recognized as a leader in sustainability through an effective environmental management system (EMS). Obtaining international certification to the International Organization for Standardization (ISO) 14001:2004 EMS standard was chosen as a means of recognition. The EMS ISO standard requires that performance be measurable and that continuous improvements have quantifiable evidence.

The department oversees three water and two wastewater treatment plants, with associated distribution and collection infrastructure, serving a community of approximately 107,000 people. The Utilities Department operates from the revenues generated from rate payers and is not funded through any tax structure. It is run similar to a business, and a business case must be made for each improvement or expansion of service.

The City Council approved the Utilities Department's strategic plan; budget line items to support the EMS, called GreenWay, were included in the fiscal year 2008 municipal budget and also approved by the City Council. The department immediately began implementing its performance-based management system and received its certification as an ISO 14001:2004 EMS standard organization in August 2008. The Utilities Department was the first water and wastewater department in the state of Florida to achieve an international certification of its environmental management system, and it was the first utility in the nation to have all aspects of a water and wastewater utility independently recommended for certification after an initial audit.

GreenWay has led to a number of improvements, from reducing environmental and business risks to improvements to the financial bottom line. The utility has saved money by decreasing energy use, and its bond rating improved in June 2009 from an A- to an A. The department director attributed the bond rating improvement mostly to the implementation of an EMS.


In developing the EMS, the Utilities Department embedded the Six Sigma breakthrough strategy for continual improvement and identified three significant aspects to focus on: energy use, production and handling of bio-solids, and environment, safety and health. The department identified environmental and business risks associated with these significant aspects and their impacts, and then it developed objectives, targets, and programs to mitigate the negative or enhance the positive effects to the natural environment and work place environments.

Six Sigma is a means of improving quality by identifying and removing the causes or errors impeding improvement by following a defined sequence of steps and employing quantifiable targets. Financial benefits can result when these targets are reductions in the use of natural resources (fossil fuel energy use). All members of the core project team completed Six Sigma project definition training, and some completed more advanced Six Sigma training. The Utilities Department follows five steps for analyzing and improving processes: define high-level project goals, along with the current process; measure crucial aspects of the current process and collect relevant data; analyze that data to discover cause-and-effect relationships; improve the process, based on the data analysis; and control the process changes taken to achieve desired results. (1) A Six Sigma charter project was established for potable water plant efficiencies, and the resulting control plan is reviewed and revised quarterly Optimized and reduced energy use at the potable water treatment plants achieved a 11.7 percent real cost savings in calendar year 2008 over the previous year, in spite of rate increases, and resulted in an 18 percent budgetary savings. Optimization initiatives continue to save energy costs in calendar year 2009 over the previous year, with an 18 percent reduction in energy use through August 2009. Increased efficiencies realized through incremental and controlled improvements to processes and objective measurement are also reducing other costs, including those for treatment chemicals and labor. The utility has also initiated a similar Six Sigma project to address energy reduction for the wastewater treatment operations.


Becoming an EMS-certified organization has required the Utility Department to continuously improve its environmental performance with objective evidence; this performance management system is particularly suited for organizations that are striving to reduce operating costs associated with energy and natural resource consumption. Reducing plant energy costs has been a major benefit. The system is also suited for reducing environmental and business risks, and combining it with the Six Sigma strategy has created a powerful tool for improving the organization's overall financial picture.

Within one year of becoming certified, Standard & Poor's raised Palm Bay's Water and Sewer Improvement bond rating from A- to A. The rating improvement in tough economic times indicates the Utilities Department's stability and creditworthiness. The department attributes much of the improved credit rating to GreenWay It is hoped that as the EMS matures, and as risks and resources are even better managed, the credit rating will continue to improve.

The Utilities Department also won two prestigious awards that are primarily attributable to the commitment to continuous improvement and regulatory compliance an ISO EMS requires. In December 2008, the Florida Section of the American Water Works Association awarded the City of Palm Bay first place in the state for its outstanding water distribution system. And in November 2009, the Florida Department of Environmental Protection announced that the City of Palm Bay Water System was selected to receive a 2009 Plant Operations Excellence Award, recognizing outstanding treatment plant operation, maintenance, and compliance.


The ISO standard institutionalizes a continuous improvement management framework (plan, do, check, and act). For example, the framework is part of the objectives, targets, and program steps used to enhance or mitigate the significant environmental impacts of the department's significant aspects. Each objective, target, and program has a built-in "plan-do-check-act" cycle. In addition, periodic management review meetings that assesses the effectiveness of all elements of the management system are required, and senior management directs changes, as necessary, based on these periodic assessments.

An example of a specific performance management practice required by the ISO standard is the periodic evaluation of the workforce's critical skill competencies. A template that lists critical environmental skills was prepared for each job description and person in the workforce; it is used to quantify and evaluate competencies. A supervisor assigns a numerical rating of one, two, or three to each item (e.g., one--able to perform task; two--minimal assistance required; three--assistance required). The template identifies personnel who require additional training, and how much, using each person's template score. This technique also identifies areas where additional resources are needed. The evaluation is required on a six-month cycle and is done for new employees within 90 days of their hire dates. The results are used to program resources for training at the individual, division, and department levels. Other management practices for which templates are used include the evaluation of risk; objective, targets, and programs; standard operating procedures; and corrective and preventive action requests.


Support from the Top. One of the most important lessons the Utilities Department has learned in pursuing a certified EMS is that top management must fully support the effort. In the case of the Utilities Department, the elected leadership and city manager of the City of Palm Bay had a vision of excellence that supported and funded a certifiable management system. With support of senior community leadership, the Utilities Department appointed an environmental management representative and developed and signed off on an appropriate environmental policy To make this kind of undertaking succeed, it was necessary to appoint and train a core team of senior managers as well as an implementation team of key managers and supervisors from throughout the organization. The Utilities Department appointed a core team of eight employees to implement its EMS. Another key to success was appointing an EMS implementation team, which comprised 25 managers and supervisors from all areas of the utility

Adequate Training. The training the managers and supervisors receive makes all the difference to the project's success. Training provided staff with the competency and confidence to implement the management system throughout the organization. It is necessary to train the entire workforce in environmental awareness, relating each individual's job to significant environmental concerns. This leads to increased employee awareness, which allows employees to make the meaningful and focused suggestions that serve as a basis for continual improvement.

Structured Communication. Internal communication must be encouraged while the project is being implemented. This is greatly enhanced by structured weekly or biweekly department, division, and section meetings throughout the organization. In addition, during implementation, monthly core team management review meetings are recommended.

Help from the Certification Group. Involving the third-party certification body early in the implementation process can help ensure a successful certification audit. It also helps to provide for preliminary informal evaluations such as a desk audit of documentation. An onsite readiness review can also be beneficial.

The Voice of the Customer. Customers--both internal and external--need to be able to express their views, and the organization needs to take corrective and preventive action that addresses those comments and suggestions. Concerns and complaints have to be tracked and trended too, and the organization needs to provide objective evidence of continuous improvement. Customer satisfaction and feedback should be quantified and compared with established baselines, entitlements, and applicable benchmarks.

Statistical Tools and Strategies. Process performance measurements and targets can be enhanced with statistical tools and strategies that look forward, not backward. Six Sigma techniques can provide managers with measurement tools and strategies to more effectively control their organizations and give added confidence regarding decisions that influence future performance.

Templates. The Utilities Department found it necessary to use templates to ensure that standard operating procedures and processes addressed the elements of certification (e.g., purpose, scope responsibilities, associated documents, measurements, records). Developing standardized templates can provide conformity to the ISO Standard and streamline the implementation process.

PEER Centers. Establishing a partnership with a regional Public Entity EMS Resource (PEER) center for advice and hands-on implementation assistance can be extremely helpful. A PEER center is designated by the Environmental Protection Agency to assist public and private entities in establishing continuous improvement frameworks such as the Utilities Department's EMS to implement green initiatives and sustainable practices. The Utilities Department was assisted by the University of Florida's Center for Training Research and Education for Environmental Occupations (TREEO), one of only eight PEER centers in the United States. TREEO provided internal auditor training, compliance evaluations, and initial internal audits of all Utilities Department divisions.


The journey taken to successfully implement GreenWay was one of useful assessments and sometimes blunt, internal critiques of the way the organization had always done things. It was a learning exercise that provided valuable insight and revealed areas and programs that could be strengthened and enhanced. Equipping employees with the fundamental knowledge of GreenWay's purpose helped them develop a greater awareness of their roles within the utilities organization, and this heightened awareness was essential in developing an all-encompassing performance management system.

An ISO-certified management system is an excellent way to institutionalize performance management and continuous improvement throughout an organization. A third-party's certification of ISO EMS conformance instills confidence in stakeholders that the organization is saying what it will do and doing what it says. It also demonstrates transparency of operations and, in the case of a utility, provides evidence to regulators that regulatory compliance is a priority. Providing objective evidence of improvements also encourages a focus on cost savings and the financial sustainability of the organization.


For Additional Information

In 2007, the City of Palm Bay, Florida. implemented an accountability management system called PalmStat. The PalmStat system is used to improve performance and service delivery of all departments within the city. City management, department heads, and staff work together to review statistical information and develop strategies for improvements in all areas of the city. The Utilities Department participates weekly in this performance management practice. See the Web site at

The City of Palm Bay Utilities Department's strategic plan. dated February 2007, is available at documents/strategic_plan.pdf.

The City of Palm Bay Utilities Department was the first water and wastewater department in the state of Florida to achieve an international certification of its environmental management system and is the first utility in the nation to have all aspects of a water and wastewater utility independently recommended for certification after an initial audit.

Further information about: The City of Palm Bay Utilities Department's international certification is available at the following Web sites:

TREEO Center at the University of Florida,

The PEER Center,

For more information about the services offered by the Palm Bay Utilities Department. please visit the department's Web site at or call 321-952-3410.


(1.) Joseph A. DeFeo and William Barnard, JURAN Institute's Six Sigma Breakthrough and Beyond--Quality Performance Breakthrough Methods (New York: McGraw-Hill Professional 2005).

DAN ROBERTS is assistant utilities director for the City of Palm Bay, Florida,
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Title Annotation:[PM.sup.2] Connections: PERFORMANCE MEASUREMENT & MANAGEMENT
Author:Roberts, Dan
Publication:Government Finance Review
Geographic Code:1U5FL
Date:Dec 1, 2009
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