Moving Outside-In. 4 steps to redefining business processes forever.

From the desk of James Dodkins

Part 1 of 4: There are four distinctly Outside-In ways that you can rethink
process and in doing so achieve Triple Crown benefits.

Let’s take them in bite sized chunks.

  1. €    Understand and applying Process diagnostics
  2. €    Identify and aligning to Successful Customer Outcomes
  3. €    Re-frame where the process starts and ends
  4. €    Rethink the business you are in
Let’s start with…
1. Understand and applying Process diagnostics:

Earlier we have mentioned Moments of Truth, those all important interactions
with customers. Let¹s take that discussion further and include other closely
related techniques for uncovering the real nature of process ­ breakpoints
and business rules.

Firstly Moments of Truth (MOT) were first identified by Swedish management
guru Richard Normann (1946-2003) in his doctoral thesis ³ Management and
Statesmanship² (1975).
In 1989 Jan Carlson, the CEO of Scandinavian Airlines (SAS) immortalized the
phrase with his book ŒMoments of Truth¹. He clearly linked all customer
interaction as the Causes of Work for the airline and set about eradicating
non value added MOT¹s and then improving those he couldn¹t remove.
a)    Moments of Truth are a Process Diagnostic
b)    They occur ANYWHERE a customer ³touches² a process
c)    They can be people-to-people, people-to-system, systems-to-people,
system-to-system, and people-to-product
d)    ANY interaction with a customer is a Moment of Truth
e)    Moments of Truth are both process Points of Failure and Causes of Work

Carlson transformed the fortunes of SAS with this straightforward insight ­
all work in our organizations is ultimately caused by the Moment of Truth.
Fix them and you fix everything else.
All Moments of Truth should be eradicated and those remaining improved. In
doing so the customer experience is improved, costs are reduced and
productivity maximized.

Next let¹s review Breakpoints. Breakpoints (BP¹s) are the direct consequence
of MOT¹s and are all the internal interactions that take place as we manage
the processes caused by the customer interactions.
a) Any place that a hand-off occurs in the process is a Break Point
b) Break Points can be person to person, person to system, system to person
or system to system
c) Break Points are both process Points of Failure and Causes of Work

By identifying BP¹s we can set about uncovering actions that would in turn
remove them, or if not improve them. BP¹s are especially evident were
internal customer supplier relationships have been established say between
Information Systems departments and Operations. Empirical research suggests
that for every Moment of Truth there are an average of 3 to 4 Breakpoints.
In other words a process with ten MOT¹s will typically yield 30-40
All Breakpoints should be eradicated and if not at the very least improved.
In doing so we get more done with less, red tape is reduced, control
improves and the cost of work comes down.

The third in our triad of useful Outside-In techniques is Business Rules.
Business Rules are points within a process where decisions are made.
a)    Some Business Rules are obvious while others must be ³found²
b)    Business Rules can be operational, strategic or regulatory and they
can be system-based or manual
c)    Business Rules control the ³behavior² of the process and shape the
³experience² of those who touch it
d)    Business Rules are highly prone to obsolescence
e)    We must find and make explicit the Business Rules in the process

Business Rules (BR¹s) are especially pernicious in that they are created for
specific reasons however over time their origin is forgotten but their
effect remains. For instance one Life insurance company had a delay of eight
days before issuing a policy once all the initial underwriting work was
complete. This has a serious impact on competitiveness as newcomers were
able to issue policies in days rather than weeks. After some investigation
it was discovered that the Œ8 day storage¹ rule was related to the length of
time it takes ink to dry on parchment paper. This rule hadn¹t surfaced until
the customer expectations changed. There are many examples of previously
useful rules evading 21st century logic and blocking the achievement of
successful customer outcomes. All Business Rules should be made explicit and
challenged in todays context.

Next time we’ll take a look at the second way to radically redefine process:

Identify and aligning to Successful Customer Outcomes