Starting From A Different Place

December 11, 2009
While engaging with customers on BPM initiatives we often see a desire to move forward with a broad-based process mapping exercise, but find ourselves recommending a degree of caution.  Often there is a need to recast the scope and initial emphasis of the initiative first.

Bigger Gains to be Made!

There are far bigger gains to be made from ‘Doing Different Things’ rather than just ‘Doing Them Differently’ (process improvement). So before you launch into a program of process re-design consider looking at your business from a subtly different place – the customer experience and the outcomes they desire. Re-designing your business around the customer experience and what the customer values will not only deliver better customer relationships and a better long term competitive position, but it will also transform your own costs!

For example, we now think nothing of it, but when Federal Express started providing customers with a way of tracking their own packages, they transformed the customer experience (and changed an industry). As a result they enhanced their own competitive position, but they also saved a lot of money. They had effectively re-distributed the process, outsourcing the tracking element to the customer using an automated service.

Ensuring Greater Commitment and Engagement!

Whereas the more traditional approach of process improvement results in slow and incremental improvements at best, the strategic focus on a broader organizational transformation – more quickly improves customer facing processes and overall competitiveness.

A process mapping exercise is an essential part of that long-term transformation objective, but it starts people off in the wrong mode – often reinforcing past behaviors rather than giving the organization a framework within which to improve.

The issue is really one of organizational engagement – how to build the appetite for long-term organizational improvement.  It is not that process mapping is not important – it is.  It is more that about the context for that process mapping and who will really undertake it.  If the organization has an external provider come in and “do it for them” then it will miss much of the opportunity associated with that effort.


Individuals from within the respective business units will not be intimately involved, and as a result, they will see it as somebody else’s solution.  On the other hand, if you empower teams to design a new future – one that meets the needs of your target customers, and at the same time propels the organization into a stronger competitive situation (more efficient, lower cost, faster, safer, etc), then they will rise to the challenge.  The challenges are their challenges; the changes are then their changes; the improvement initiative is their improvement initiative.  Why? Because people really do want to do a better job; they want to feel that their jobs are safe, etc.

A Different Container

The point is that using the “Customer Experience” and “Services” as a driver for business change gets you over the organizational engagement hurdle.  Rather than having conversations about the defensibility of the current processes of the business unit – that is, assuming their eyes don’t glaze over as they start looking for something else to do – they start thinking about how to improve the outcomes for customers.

Too often, when you try and address the “process” problem directly, business people maintain that their processes are already good enough; or that they just need good people (rather than admitting that they don’t know what their processes actually are).  But if you challenge these same people to think about the alternatives that customers have, and benchmark services that may be out there, they suddenly see it differently.  The conversations are entirely different.  It starts them off at a different point – one that has leadership team blessing and involvement.

Maintaining The Focus

Of course, the fact that they need processes to support service delivery then becomes obvious.  The process mapping effort is then a way of creating a baseline – documenting where the organization is at currently.  The degree of detail and metrics gathered are naturally focused on the outcomes that customers experience.  It stops team members disappearing down rat-holes as they endlessly model the nth degree of detail.  The brand-level “customer experience statement” acts as a guide and rudder to the overall change programmed.

Yes, a little more time is spent in preparation and organizational alignment (with the Leadership Team and in commissioning teams) but our methods enable the organization to reap big dividends.  They save money in the context of undertaking that process mapping exercise.  But more importantly, they create an appropriate organizational vision for how the organization is going to develop and deliver customer value in the future.  Rather than appearing to boil the ocean, they provide a fast track to the benefits that the organization desires.  They lower the risk in that management can make investment decisions and set priorities based on the blueprints developed by the teams, safe in the knowledge that the organization is firmly behind the overall change program.

At the same time, our approach grows the skills and business acumen/maturity of those involved in the business today.  We set out to embed the world’s best practices in your people, enabling them to continue improvements and drive ongoing improvement efforts into the future.  Moreover, it prepares them to improve their business themselves.  Experiencing these methods and techniques helps your people build the confidence that they will need in order to deliver on the long-term strategic vision.

This leading edge, yet pragmatic methodology is derived from many years of experience, building on and extending techniques such as Balanced Scorecard, EFQM, Lean and Six Sigma.  It also includes a practical program management methodology that extends common BPM Project/Program methods.

You Can’t Make A Baby In A Month By Getting 9 Women Pregnant

August 3, 2009

While talking about the Obama stimulus package, Warren Buffet recently said “You Can’t Make A Baby In A Month By Getting 9 Women Pregnant” (he was referring to the fact that some things take time). And continuing on that theme, this article asserts that neither do many small incremental improvements make for “Business Transformation” – changing the culture takes time!

In his blog a few weeks back, Phil Gilbert raises a number of important questions: (paraphrasing)

  1. What is Culture – and why can’t we change our BPM behaviors?
  2. Why do BPM people promise fast incremental, continuous improvement, and then go and start every program by ‘boiling the ocean?’
  3. How do we get from “Project” to “Program”?

He was talking about the fortitude required to take BPM to the long term – where the (existing) culture is the single biggest impediment. One could interpret Phil’s post as suggesting that cultural change is akin to “boiling the ocean” (attempting to fix everything at once); a strategy that is destined to fail.

But in order to move beyond putting a band-aid on a broken process (Project to Program), you need to take a step back and really set out to engage the hearts and minds of the business itself. And that implies challenging the established behaviors – creating a new vision of how to run the business – one where Process is part of the bloodstream; where the customer is king and effective processes deliver the great experiences they expect. Moreover, it also means challenging the way in which the organization is run (using processes to manage rather than just managing processes); indeed every facet of how the organization delivers value to its stakeholders.

Just because the new tools and technologies of BPM allow fast incremental, continuous improvement as a means of business change, does not mean we should do this everywhere – we shouldn’t! Sure, to get the initial project up and running, you need to stick to the core 30% of functionality that delivers 70% of the value and then iterate from there, spiraling toward better performance and a better fit with the underlying business need.

But getting the attention of the organization (taking the BPM challenge to the wider enterprise) and changing the established behaviors requires different tactics. Modeling the desired behaviors again and again just wont do it. Or putting it another way, endlessly tweaking existing processes within the current architecture fails to deliver – what you will get is “Better Sameness” not “Transformation”. Hoping that the pain of it all will enable the organization to develop an inner moral strength – one that is powerful enough to overcome the challenges associated with this transition misses the opportunity to re-energize.

The greatest obstacle to culture change is that once a culture has developed, the assumptions that led to it are so deeply engrained, that no one recognizes them and therefore, no one challenges them. In order to change a culture, it is first essential to identify the right underlying assumptions of the current culture and challenge them head on – before trying to implant a new culture.

It’s Wells – not Oceans!

So, what to do? Well, the good news is that a big, transformational vision does not involve “boiling the ocean”. The best way is to ‘Find a Well’ (the analogy being the Well of Life needs no external drivers – it is a life-giving source).

I have spent many years as a business strategy consultant helping organizations find effective, long-term, sustainable business strategies. I help them find a Well that shareholders, suppliers, customers, partners, the market and the community can all draw upon to enrich and energize their business and satisfy their needs.

What do these Wells look like? They are the values that are at the heart of that business area. Collectively, these values give direction, guidance and are rich source of ideas and new ways of doing things. So, we do not need to boil the ocean, just discover what drives and inspires the business and its people to adopt new ways of doing things and developing new behaviors.

In this approach, internal drivers that everyone values (because they see the relevance to their own business and business success) replace externally imposed behaviors (as the means of creating culture). Values come from an eternal spring – energizing again and again – hence sustainability is not an issue.

The even better news for BPM is that it is almost certain that any properly facilitated Business Strategy Workshop should lead to a Transformational Vision (the Well), with “Great Customer Experiences” as the source of Competitive Advantage.  Why is this good news for BPM? – because Great Customer Experiences rely on carefully designed Business Services, supported by effective Business Processes that provide the foundation for staff in delivering these experiences.  

At last – BPM and Incremental Improvements!

A full program will then spring from the facilitated development of the transformational vision and values. Now, having begun with the development of a transformational vision it is possible to build a program of projects; driven from the same source and fully aligned with the agreed business strategy. Those projects are built and driven by the business themselves; for the business.

However, as each individual project is taken forward the power of BPM technology then becomes clear.  BPM allows business process developers to re-iterate their designs and carry out successive re-designs – all aligned with this vision. The Center of Excellence (or IT function) provide some of the resources for those projects, but the real work, on the behaviors of the employees and the experience delivered to the customers, is carried out by the people in the business. Since they are involved in designing their own processes to support their customers, they develop a much stronger sense of ownership.

When it comes to cultural change, it is just not possible to impose a solution. You have to engage the business properly, which means winning their hearts and minds. Start with fast incremental improvements using BPM whilst convincing yourself you are being ‘business driven’ and you will end up with better sameness. Others will ask whether it worth all that effort?

On the other hand, begin with a transformational vision and your program will be truly business driven and energized. You can then move toward that vision, using the full power of BPM technology, as you continuously improve your new services and new ways of working. And your customers will become raving fans (and your staff will like it too)!


Breakthrough Process Design

August 3, 2009

We find ourselves presented with situations where our clients are looking for “Breakthrough Performance” rather than mere “Process Improvement”. In her guest post on Jim Sinur’s blog, Elise Olding points out that many rush headlong into implementation looking for an elusive Magic Bullet (there aren’t any, but you could describe BPM initiatives as a Golden Gun). She quickly alluded to the need for a number of techniques including “Process Walkthroughs” (following the work item), through Sticky Notes or PostIt Sessions, down to and including sitting with the users and observing what they do.

While all these techniques are useful and interesting, they don’t go far enough to deliver the breakthrough improvements that customers seek. In business today, generally what is needed is not “Better Sameness” but “Transformation”. But existing processes usually focus on the needs of the company – delivering stronger management control, and reinforcing functional priorities.  

However, we believe that the best practice to deliver breakthroughs is quite different from any of these approaches. We start from a different place – the “Customer Experience” – a stance that is all about building competitive advantage. 

Process breakthroughs come from thinking about everything we do in terms of how what we do can assist in delivering a Great Customer Experience. This dynamic lens is dramatically different from the traditional process improvement approach. It has the effect of inspiring completely different insights and generating new ways of doing things (rather than paving the cow paths). Once you are standing in the shoes of the customer, you no longer see the functional bias that reinforces existing behaviors.

In the early 90s the CEO of Sony pointed out that, every manufacturer had all the parts needed for a Sony Walkman sitting on their shelves – but only Sony asked the customer what they wanted. As a result, they transformed the way we listen to music (even if they did miss the disruptive innovation of hard disk based players).

In the end, we believe that you have to build a “Transformational Vision” around what the customer values – be it an internal customer, supplier customer, partner customer or end consumer. So we will continue to use the “Customer Experience” lens as the best route to achieving breakthroughs in process performance.


Customer Experience and the Business Process

July 1, 2009

As you are probably aware, there is a real challenge for organizations in delivering an effective customer experience. The problem is that the Customer’s “Experience” is often an afterthought in most business processes. The emphasis is usually on the internal problem being solved, not the impact that this process has on the customer. Now some of you are probably saying that all our processes are customer focused. But the reality is that very often that internal efficiency and profit (upsell/cross-sell) are the primary drivers of customer facing processes.

As I type this post, I am experiencing just such a broken process – it’s the oxymoron known as Adobe “Customer Service”. So far I have been on the phone for 50 minutes as I discover that their Adobe ConnectPro product, while delivered as a “Service” in the cloud, does not have the other elements that live up to anyone else’s idea of what the word “service” means (either with or without the capital S).

In this little scenario, I am trying to get the ConnectPro account to accept the new Audio Bridge so that we can get seamless audio conferencing into the BPM TechShow. So far I have spoken to three people (inside Adobe) – Tech Support immediately got rid of me saying that I had to talk to Customer Service. After 30 minutes listening to reasonable Jazz at the poorest sound quality available, I talk to someone who then says I need to talk to a special agent … then I get the Supervisor of Customer Service that tells me … you guessed it, I need to talk to Tech Support. Strangely enough, I start to bleat about it, and the very nice sounding young man says he will connect me with the Tech Support Supervisor (immediately) … and now, after another 30 minutes, I am still listening to bad Jazz.

Why am I hanging on, just to see how long they take, and whether or not I can get resolution to this issue before my next call (I have missed the orginal meeting this was needed to support … so their bad/broken process has already impacted one of my own customer relationships).

I will also take the opportunity to feed back this “experience” to the relevant Product Manager at Adobe.

Of course, I shouldn’t have to be here anyway – the process that provisioned my account in the first place should have made sure the option was set up appropriately. That means that the partner (yes, you can not buy this stuff directly from Adobe) should have been trained to pick it up, or at least have an option to line up the provisioning automatically. Indeed, even trying to buy the product (i.e. give Adobe several thousand dollars) was a similar exercise in managing the frustration of being passed from pillar to post as nobody takes ownership.

The point is that the processes that handle the transactional side of the relationship are one thing (taking your money is normally pretty efficient these days … Adobe excepted), but all the related processes that go into delivering that customer experience are just as important. And I am not even an exception – in talking to the people who provisioned the audio bridge, it turns out that several others have had the same problem (i.e. it wasn’t set up right to start with).

Now after 71 minutes on this call alone (it’s my second), I am about to kill the call and try again – clearly the supervisor seems to be out to lunch (or else I was just routed back to that endless queue that will ensure this customer will sooner or later go away). But this time I will try a different route. Right now, I am so angry that if I had the option (time available), I would probably ditch Adobe in favor of a competitive product.

Having a free 1-800 number is no substitute for actually having an effective mechanism to deal with customers and their issues (i.e. work on the behaviors and culture of the people that customers interact with).

A good customer experience builds relationships, acts as a referral point for new customers, lowers sales costs, etc. And this post is proof that a bad customer experience is destructive to your brand. Bad experiences get talked about and passed on.

Within your BPM Program, you should start off with engaging the Executive Steering Group around the “Brand Customer Experience” – a broad statement that sets the tone for all customer interactions. From that point, it becomes one of setting up an engagement program with the business designed to first of all define the sorts of “Services” that customers can expect, and then from there, the need for processes that deliver that experience. Those processes are operated by people, who should be empowered (trained) to give that designed “Great Customer Experience” every time.

I will be discussing this overall method and technique in the Day 3 keynote (July 9th) of the BPM TechShow … but I doubt that anyone from Adobe “Customer Service” will be there.

Update: I called back tried a different route into a more general Tech Support group, and then finally was given yet another number to call (this one allegedly to talk to the relevant group for Adobe ConnectPro). After 17 more minutes of listening to bad Jazz sounds, I am now talking to someone. But it seems that the person on the other end is incapable of finding the answer. I get asked questions like “when did I purchase this?” … Irrelevant. Then I am asked for the Tech Support tracking number … strangely enough I dont have one. Then they want my street address in order to “validate” I am who I am … finally, after a further 20 minutes I get a tracking number. But can I look up on the Web to track that number … Noooo, I have to go through another exercise in ritual abuse (i.e. talk to Adobe Tech Support or what passes for Customer Service).

Update 2 – 6 days later. Since this post got noticed by Adobe I have had several conversations with interested parties. Of course, we offered to help them improve the customer experience … but it seems to be an issue they are taking very seriously. We’ll see where it all leads.


Customer Experience – How To Get It Wrong

October 23, 2008

So now, exhausted after getting conferenced out over the last 3 weeks, I am on my way back across the pond. And I find myself once again confronted by the complete lack of thought on the part of my not so favourite airline (British Airways).  This posting is a bit of a rant … but it has a point. Designing an effective customer experience needs to be reflected in all your processes not just your marketing collateral.

As a regular traveller across the Atlantic, I normally fly Premium Economy as I can usually work and get things done (and that also has the added advantage of letting me actually have somewhere for my long legs). So over the years, I have risen to the lofty ranks of a Gold Card holder. And the benefits I get for that are … er … well I get to check in at the usually empty First Class line, and sit in their lounge (I don’t usually drink while on travel).

Now on the Washington to London flight, those with access to the lounge were always able to have their dinner before getting on the flight in the hope of getting some sleep on the 6 hour red-eye flight. Well not any more, it now seems that this privilege is reserved for those who have agreed to fork over the $4500 for each way (and that’s booking 3 weeks ahead).

Point being that, despite spending around $30-40K per annum with BA, I am now denied this meagre benefit (instead I have to head outside the lounge and spend $15 on a shitty hamburger).

As a Gold Card member you would think that this would entitle you to the odd upgrade – the reality over the last 18 months – nada. No upgrades unless you know someone on board, or get someone to pull strings for you back at the departing airport, or the once in a blue moon when they are really overbooked in the back of the business units (and nobody else is above you in the pecking order … i.e. has a permanent flag on their record saying they are “suitable for upgrade”).

So you start to ask yourself just what is the benefit of putting all of your business into an arrogant waste of space carrier like BA. Yes they “protect the brand” but that is of little consolation to you the regular traveller. And they piss you off with petty rule changes designed to save a few dollars – but in the process, they loose customers.

Where was the cost benefit analysis … let’s tease it apart. Per passenger that are in that category (i.e. gold card holder in Premium Economy), BA get to save perhaps $5 per person (remember they get to save the meal onboard). Lets say that applies to half of the PE travellers … say 12 people. They don’t get to save any staff costs really (same number of people standing around in the dining area). And with 2 flights per night to LHR, that say $120. Or put it another way, less than $1K per week. But along the way they loose a regular customer … and I am sure I am not the only one.

Time to switch back to United … while the service is not great, there are appreciable benefits associated with them. I am not saying their experience is much better, just that you don’t really expect much (and you dont have to pay a premium for it). BA’s marketing is that there is some real benefit … when the reality is there is virtually none (compared with competitors). Their cost cutting program has perhaps trimmed a few dollars here and there from the fixed budget, but they have also trimmed customers.


PegaWorld Keynote – Mhayse Samalya – President of Farmers Insurance

October 21, 2008

Update – you can view the Keynote itself here (requires registration).

This division of Farmers deals in the small business insurance market – a $95B market. When Mhayse joined Farmers, they had just 2% of that market. He saw it as an incredible opportunity – where 47% of business in the small commercial insurance sector, are with small business insurers. The question is why these small players succeed against a big player – it’s because they know their local community, they are part of it and know how to communicate with their customers.

Mhayse described his approach that really started with a clear Vision … He set out with objective of becoming #1 in their industry, and then laid out a strategy of how to get there.

The vision was to:

  • Excel at the core
  • Build deeper expertise
  • Leverage predictive modeling
  • Expand the appetite and sophistication of the organization,
  • Create a targeted set of offerings for agents and their customers.

Only then did they start to think about how you deal with the small business opportunity and the efficiency end of things. Sure you need an efficient way of doing the business, but the primary focus of that vision was on growth and the customer experience.

He went on “You cannot expand the appetite for more … unless you can automate the way in which the business operates. I didn’t know what I was searching for – but I was looking for something that would help us … something that would give us a clear line of sight to the solution to the business problem. I had to understand what it was going to feel like. However we get there, we had to create the right sort of agent experience … we had to get them (agents) fully engaged to get the benefits of the gem we had in our hand. How do we reap the benefits … it has to be done in increments. I wanted to know where the short term goals and pointers were (pointers that would indicate we were being successful). Trying to get there all at once is probably going to end in disappointment. We had to do a set of projects, and do them quickly, while being flexible along the way.”

At this point I was really engaged … I hadn’t heard a business leader at this level talk about a BPM project in such an impassioned way. This was his project, and he had been driving it top down. Now I started recording the slides and some of the related phrases:

Create the right agent experience – we had to demystify that experience so that it really helps the agent – pre-filling information into forms and easing the user experience.

  • Eliminate the useless questions and options
  • Automated underwriting decisions
  • Automated pricing … it used to take us far too long to price a policy.
  • We had to increase the pass through rate … the time to get a bound policy.
  • We were looking at (touching) 80% of the business that was passing through, and were closing just 20%. That should have been precisely the other way around.
  • The question was how could we enable the local agent to be local in terms of how they work.

Focus first on Agent expansion and New Business Growth

  • First support environment was delivered in 5 months.
  • Restaurant product went countrywide in July 2007
  • Rolled out the Auto policy facility in Oct 07
  • And getting an “umbrella” policy available as an add on in June 2008

The results:

  • 14 days to 14 minutes
  • Close rate was up 5%
  • New business was up 70% “do you want Fries with that”.
  • Renewals up 60%
  • Added over 1000 new agents (later updated in the flow of conversation to 1500 new agents).

We focused secondly on efficiency … not how many people we could chop out

  • Endorsements
  • Renewals …
  • Focus on the desired business result
  • Eliminate all the non Value Add steps, take out the noise and red tape.

Put the business change in the hands of the business

  • Pulling together cross functional teams
  • Finger pointing is the wrong way to go …
  • Rapidly iterate
  • We don’t always know exactly what we want
  • We are sometimes representing other folks … like the agents that work for us
  • Test, monitor and respond quickly.

Building the right team is critical

  • Empowered … someone who is on my team that was also part of the IT organisation
  • Dedicated cross functional teams – jammed them together, locked them in a room and told them they couldn’t come out.
  • Wanted to have a partner with skin in the game. Developed a Customer Intimate relationship with Pega. Their compensation was linked to the delivery of our results. Now we really are on the same page.
  • Get participation and engagement – with the agents.

Farmers had gone from low on the food chain … to the fastest growing at Farmers, the most profitable at Farmers, acquiring over 1500 new agents. They acquired a business along the way and have now grown to around $3B, representing 3% of the available business out there. Tied for first place.

Questions – How do you change the culture? At the end of the day it comes down to individuals. The traditional solutions were not going to get us to where we wanted to go. We have 1000s of people and unless you start to align the objectives, their compensation, etc. then you will have problems.

There has to be a common and shared vision – one that get both business and IT people excited. Too often there is an assumption in the business mindset that IT folks don’t have that sort of vision – that they don’t respond to the challenge. Point was that with the BPM program (still ongoing) they had proved that wasn’t true.

The key point for me was that he focused first on the Customer Experience. They had a strong visionary leader who publicly aligned himself with the overall success of the program. Theydrove partnership and engagement through cross-functional teams to achieve results The business results speak for themselves.

I just hope that Pega and Farmers agree to put the video up on the web so that we can point others to this powerful case study.Its one that every COO and CEO should see.