When talking to operational & performance managers I hear that many of them are running programmes such as Lean, System Thinking or Six Sigma in order to help them make improvements to their processes. An interesting point that many of them raise is that whilst their adopted methodology is clearly delivering benefits they do experience common challenges which they feel limit the projects short term objectivity or long term sustainability.

I am interested to know if you are running a process improvement programme within your organisation. If so please email me to tell me about it.  How successful is it and why?  What are your challenges and what are you doing in response to them?  What is missing or what would make your project more successful?

Please contact me at chrisfryer@eguk.co.uk with your views and experiences and I look forward to sharing with you what’s recommended.

If you complete your details below we will send you a white paper on ‘Supporting Performance Improvement in Service Organisations’

Summary taken from a white paper written by Mr P Ezzard, eg solutions plc.

Introduction

Research in the USA retail banking sector suggests that at the turn of the century, 70% of customer transactions were still undertaken by face-to-face contact in High Street branches. By 2005 this had reduced to 42% and it is predicted in 2010 it will account for only 30% of service transactions (Corporate Executive Board 2006 – Lean Manufacturing for Financial Services).

These face-to-face transactions have been replaced by telephone; internet and ATM entered requests routed to large Contact and Processing Centres. This pattern is being repeated in service organisations across the world.

This change has been driven in part by the development of technology but also by organisations wanting to reduce costs and improve service through centralisation, outsourcing and off-shoring of service support and processing.

In this context further research in the USA suggests that in service industries 40% of operational costs are wasteful even when the work is undertaken in dedicated centres (Corporate Executive Board 2006 – Lean Manufacturing for Financial Services). Similar research in the UK suggests that “failure demand” in Contact and Processing Centres can account for anything from 20 to 60% of all customer transactions in financial services, often higher in local authorities and utilities (Seddon 2003 and 2008). (Failure demands are customer contacts and subsequent processing activities caused by a failure to do something or do something right for the customer.)

It is therefore not surprising that service organisations are continuously looking at ways in which to improve performance.

Two key ways of doing this are through:

• Operational management improvements that result in the more effective utilisation of resources and processing systems available. For example, implementation of operational intelligence and improved operations management practice.

• Initiatives aimed at achieving improvement through re-engineering processes, structures and cultures. For example, “Lean” and “Six Sigma”.

The two approaches are separate but complementary. The purpose of this paper is to provide an overview of several of the more common improvement methodologies and then to show how eg operational intelligence® can be used alongside them to monitor success and maximise the benefits that can be achieved by organisations striving to meet customer and cost improvement requirements.

To request a copy of the full white paper please complete the form below.

I read with interest the recent blog from my colleague, Andrew Baker where he explored how important it is to get the people who are dealing with customer interactions and processing to take ownership for a balanced set of operational measures that reward the right behaviours.

This ownership should always be supported by a subsequent ability to capture consistent performance data about the processes and activities as well as the people who are performing them.

The most striking thing that I have learned after nearly 10 years in helping our customers improve overall operational management is that having access to consistent performance data is a basic need that provides the catalyst for first line managers and senior managers to implement consistent operations management best practice.

Without credible information about how well processes are performing, what activities need to be completed and how well our people are succeeding in terms of customer service, productivity, skills and quality; a manager is unable to take the right actions to improve performance and in particular the level of variance that exists.

However, simply providing access to the performance data is only the start and organisations need to put considerable emphasis on first line managers and senior manager to make sure that they are effectively trained in how to analyse and use the information to drive improvements in the level of variance in performance.

So why is it so important to drive improvements in the level of variance in performance?

Let’s consider some examples of the impact of variation across a processing function of 200 colleagues:

• 10% variance in productivity can reduce the amount of customer work completed within by the equivalent of 70 man days a week

• 5% error rate in our quality can mean that we have to have extra 10 colleagues just to re-do work that has already been completed once and this doesn’t even look at the delay to the customer

• The impact of lower skill levels across key process can mean that we need to spend 25% more time producing the same level of work

Therefore the role of first line operations managers in particular, is to analyse the variance that exists and take action.  A large proportion of variance typically exists within the people due to different skill levels; pace and motivation levels or by the fact that different people will follow different procedures to complete the same activities.

Consistent operational performance measures at a people level for skills; quality and productivity therefore should provide suitable benchmarks that can be used to quickly identify where help may be required.  This needs to go beyond simply capturing actual activity levels and has to ensure effective comparison to what Andrew referred to as ‘what good looks like’ in his blog posting.

In my personal experience, the consistency and credibility of this data and its availability on demand is the key to providing confidence to first line managers to take appropriate action and make significant improvement in people performance.

Our clients using the eg operational intelligence^® software suite certainly prove that to be the case.

Tim will be sharing his extensive experience in helping organisations set, implement and sustain effective performance management objectives at the Professional Planning Forum Conference on 19-20 April.

All those specialist case handlers, counter staff, underwriters, complaints specialists and more tell me that every work request is different.  When I ask if we can measure how long the task should take, the number there are or the result achieved, I’m also told: “Well you should have been here yesterday” or “That one’s not typical” or “This is different because…”or “Yesterday they were all easy ones!”

However, there is no need for anyone to worry!  We all know that there is variation in how long things take and so any measure that covers standard time, quality, skill, service levels or process performance can be a good guide – even if the measure is not 100% precise.  It will then support how we report performance or plan for the next period ahead.

The great news is that by getting comfortable with a “robust” measure for these things, aka “the balanced range of measures”, then we have a basis for both: 1) telling us how well our process or operations perform now and 2) telling us how to plan for the future.  They provide a guide to help us answer “How many people do we need to hit our service levels?” “Who should I train next on which process?” and “Which processes will need more or less resource in the future?”, amongst many more issues you might like more information on.

So using the law of averages and the 80/20 principle (“Pareto’s Law”, where 20% of the time gets 80% of the result) we can refine the measures and move them ever closer to what everyone believes is a truly accurate figure.

Tell us your experience of measuring your processes – what works for you?  What should we avoid?  We’d love to hear!  Contact us: ask@eguk.co.uk.

My role in the Client Implementation team involves coaching clients of eg in operations management techniques and in the use of the eg operational intelligence® software suite.  In order to measure, manage and improve productivity we spend time at the outset of each project measuring how long it takes staff to complete tasks.  The unit times we record help us to assign standard times to tasks – taking into account skill level – and these times can then be entered onto our software and used to forecast how long it will take teams to finish work and analyse how well they are performing against standard times.  This is essential to help Managers and Team Leaders understand how staff are performing and helps them to identify and correct any issues – such as training needs or underperforming staff – swiftly to reduce any impact on the performance efficiency of the organisation.

So, do you think individuals should be credited with additional time for reworking a case?

Historically eg’s stance has been no i.e. rework tasks should carry a zero time.  This is on the basis that there is no incentive to complete the case right first time if you know that you’ll get a generous allowance of time to correct it.  However, many of eg’s clients allow between 1 minute and 10 minutes to rework a case to avoid challenge and conflict.  This is inflating levels of productivity and masking underlying performance issues.  Is this still the right approach?

Please let me know what you think – leave a comment or email me terifebery@eguk.co.uk

I have been training and coaching operational management disciplines in the UK for over 10 years and recently been working in South Africa too.   I think that regardless of the culture or operating environment the following tips for Team Leaders are the basic fundamentals in achieving operational excellence. 

Do you have any other daily tips you think should be added to this list?  Email me: wendyjeavons@eguk.co.uk

1. Keep your measures up to date!  Put in place a quarterly review process to validate all measures including service standards, staff skills and quality.

2. Maximise your available hours.  Produce stretching plans each day to meet individual and team targets.

3. Ensure all team members have a full days work based on their available hours and skill.  Apply the principles of short term scheduling to maintain motivation throughout the day.

4. Communicate daily objectives to the team.  Hold ‘Buzz Sessions’ each morning to energise and motivate everyone.

5. Involve the team in visualising performance throughout the day.  Update a whiteboard to show progress against plan.

6. Manage By Walking About!!  Don’t get stuck behind your PC.  Monitor work completion throughout the day by visiting each member of the team.

7. Actively feedback and coach on personal skills e.g. customer service in addition to technical areas.

8. Manage performance variance across the team.  Be prepared to challenge and don’t forget to recognise achievements throughout the day to maintain pace and productivity.

9. Analyse your results.  Understand the cause and effect relationship between all Key Performance Indicators.  For example the impact of skill levels on quality standards.

10. Undertake process reviews in consultation with your team members and other areas that impact the process.