A new 15 minute overview of the challenge of Outside-In. Interview by the facilitators of the Lean Six Sigma conference in Orlando during January. http://bit.ly/6fzUkr
Still a few places left at what the BP Group endorse as a 5 Star ‘excellent’ event. There will be several BP Group presenters and workshops so if you have a chance to book at short notice register here – http://www.leansixsigmasummit.com/
Join us for a drink and BP Group community exchange đ
There is no easy way to introduce a new order of things however there are some principles that can be followed based on this type of mind shift.
1, Objective and immediate.
The results we achieve with Outside-In are significant and substantive e.g. Triple Crown*. Accordingly any effort should first of all identify the clear tangible benefits.
2. Talk is cheap.
Fine words and phrases will not win hearts and minds without substance. Delivery is key, hence the ‘start where you are’ sentiment. In current projects (where support may be lacking) introduce the techniques within the CEMMethod(tm) by stealth.
Lift the heads of those around you to think of Moments of Truth, Break Points and Business Rules for instance. “Nothing new mate, just some stuff other guys have used within… Six Sigma../..Lean../..EA../..complaince etc. (delete as appropriate)”
3. Build support.
With (2) underway you will build support. That is the point to shift focus and begin the more practical discussion of where and how.
4. Go for broke.
If you are extremely lucky/persuasive and have the top team already onboard go for broke. Discover the worst most problematic issues and set to righting em. By fixing the Cause you will remove the Effect.
5. Move on.
It is a 4-500 year shift in mindset (Dee Hock, VISA founder).
It will ultimately transform the planet. The jury is in fact back and the results speak for themselves. So when all looks desolate and casting your pearls before swine is depressing, remind them that they are part of the problem and move on.
6. Make it so.
YOU ARE NOT ALONE it just feels that way when surrounded by flat-landers (doh). Learn, exchange and do.
As an aside Charles Bennetts links to the cartoons are thought provoking. We have links to them in the respective Alumin’s in the subgroup areas đ
Join the worlds first and largest Outside-In community at: http://www.oibpm.com
Once on-board review the subgroups and join the specialist communities – you will
find friends and support as we transform the planet one person,one process, one organisation at a time!
*Triple Crown: Jim Sinur (Gartner) coined this phrase. Through the delivery of advanced BPM you will simultaneously reduce costs, enhance service and grow revenues. In public sector/not for profits replace revenue growth with delievry of strategic objectives.
Presented in Chicago at the
5th Annual Process Excellence Week for the Service & Transactional World
By Dick Lee, High-Yield Methods
Peter Drucker famously opined that the greatest risk to organizations was neither doing the right work wrong nor doing the wrong work but not seeing or reacting to profound change occurring around us. Today, we’re in such a period of transformational change, with a powerful confluence of forces driving up the power of customers in buyer-seller relationshipsâand correspondingly depressing the potential for sellers to stay competitive while putting their own interests ahead of customer interests.
That this change is occurring is almost beyond debate. But how to effectively respond to this sea change is not only a matter for debate, but a source of great frustration for sellers. Fortunately, a growing number of companies are showing the way by proactively treating the rise in customer power as an opportunity rather than a threatâand using an approach becoming known as “Outside-In Process” or just “Outside-In” to build bridges extending out to customers.
Profiting from putting customers first
Since 1996, when it brought its first commercial product to market, Gilead Sciences has been among a group of companies providing pharmaceuticals to treat medical problems resulting from HIV-AIDS. But in 2006, Gilead leapt ahead of the pack by introducing a new drug developed not just for medical efficacy, but to improve quality of life for AIDS sufferers while also increasing patient compliance with following what had been an extraordinarily complex drug regimen.
A growing number of companies are showing the way by proactively treating the rise in customer power as an opportunity rather than a threat.
Gilead stepped outside of outcomes data and all the standard product development protocols to see medication through patient and physician eyes. And what it saw was patients taking its own “drug cocktail” in 17 different daily doses that required exact sequencing, including some via IV. And what Gilead also saw were patients unable to follow the regimen and falling off their medication as a result. Classic Outside-In vision through customers’ eyes. And classic Outside-In customer problem identification that lead to both a medical breakthrough and a customer breakthrough.
Access the full article here > http://bit.ly/fnmU0 <
This is a follow-up to ‘How to really annoy Americans’. You can join the extensive discussion to the original article at http://bit.ly/DdCLW
Let’s turn our attention instead to making people happy and for that we need a candidate organisation who know precisely how to create and manage call centres and the resulting activities. This is also derived from ARG’s research and provides useful pointers to all of us who need to intereact with customers via the phone.
Every telephone operator at Cabela’s speaks English, and a customer never speaks to a machine. “Every single call is answered by a live person,” Ron Spath, VP Customer Relations, states “We don’t have any interactive voice recorders and there are no menu’s. The feedback from our customers is very clear about how they appreciate not having to waste a lot of time to someone who speaks broken English. We realise that outsourcing these calls to india costs less but we think it is a good investment to pay more in order to save customers time.”
To cap it Cabela’s, the worlds largest outdoor retailer, even prints its telephone number on the front and every page of its website. Just imagine that, a company who actaully want to talk and learn from their customers.
This positive Outside-In approach pays on the bottom line and has seen Cabela grow to being the world leader in its market in just 50 years. You can read the story at http://bit.ly/xHYzL
So is it that hard to do. Actually let people talk to people that really understand?
The debate rages over at the BP Group Linkedin zone… see http://bit.ly/LBhwq
Fixing effects is a lot like shuffling the chairs on the deck of the Titanic. Lots of work gets done and things look different but the original problem still remains.
Fixing effects increases the complexity of our work and the technology we us to support it. Itâs a vicious cycle many of us are stuck in. The more we do the worse it gets. Soon analysis paralysis sets in. Weâre stuck and thereâs no place for us to go.
Meanwhile successful companies around the world are now eliminating causes rather than fixing effects. But how do they spot causes and eliminate them? Is a host of Master Black Belt Cause Eliminators needed to get the job done?
Of course not. Moments of Truth, Break Points and Business Rules are the causes of work. Once we start looking for them we spot them. Elimination comes from challenging what we currently do – looking for Actions that eliminate Moments of Truth, Break Points and Business Rules.
How big is the size of the prize? Efficiency and productivity gains of 30% to 60% are common. Cost reduction of services by 50% is not unusual.
Cause elimination is a seek and destroy mission. Itâs the challenge to weed out the âdumb stuffâ in our organizations. Are you ready to challenge your assumptions and start eliminating those causes of work?
There is no excuse for complexity. It is a consequence of muddled thinking and a lack of understanding of the true goal of the organisation, which is creating Successful Customer Outcomes.
Complexity has developed as organisations have added new routes to market, new ways of delivering service, new enterprise IT systems and a myriad of improvement approaches. Each internal functional specialism has developed a mindset to optimise their part of the organisation, sometimes at the expense of others. The unwieldy complexity that results has caused a reaction primarily aimed at the need to create order out of this chaos, as if accepting that complexity itself as a right to be. This is not so. Let us unravel the muddle of complexity once and for all.
All work in an organisation is fundamentally created by the need to provide product or service to the customer. Everything else is a consequence of that need, which creates value for the shareholders and creates a livelihood for the work force. All else follows.
Furthermore all interactions in meeting the needs for customers are the cause of all work within an organisation. These interactions, or Moments of Truth[i], create work in so far as we need to attend to a request internally.
In doing so we interact with our colleagues, systems and other internal processes, and create internal Moments of Truth, which can be referred to as Breakpoints[ii]. The way we deal with Moments of Truth and Breakpoints is underpinned by Business Rules[iii] which may be thought of as âdecision points within processesâ.
These three entities determine the shape of our organisation, the internal landscape of how we do work. The resulting activities from Moments of Truth, Breakpoints and Business Rules create the very processes themselves. In fact process is simply an effect caused by the way we choose to interact and guide the customer to obtain our products or service.
Think about that â process is an effect. If that is the reality then the vast range of tools and techniques created in the last century, and sometimes before, are fixing an effect. It is like taking painkillers for discomfort and nothing more. If we are not getting to grips with the causes of the pain it will surely get worse and as we discover, stronger pain killers are then required.
Thatâs the rub. We have been systematically fixing the wrong things and is it any wonder that change doesnât stick? Have you ever had that feeling that this is the same project challenge as before, just dusted off and here we go again? It is because we are not fixing the causes of work, and while we continue to ignore the causes the complexity worsens, costs increase and service suffers.
Einstein put it well when he said
âWe canât solve problems using the same kind of thinking we used when we created themâ
Part Two: Case Study â UK Bank âHow complexity developedâ – See http://bit.ly/LBhwq
[i] Moments of Truth â a concept discovered and explained by Jan Carlson.
Any interaction with the customer is a Moment of Truth.
[ii] Breakpoints â internal handoffs within an organisation.
[iii] Business Rules -Decision Points within a Process.
J D Powers latest survey (issued June 30, 2009) ranks the Customer Experience of 13 Airlines.
An indicator of the trend to ‘Outside-In’ business models is the performance of companies delivering consumer oriented products and services (B2C) and no less so than the airline sector.
The survey, which queried nearly 13,000 travelers, measured airlines in seven categories: cost and fees; flight crew; in-flight services; aircraft; boarding/deplaning/baggage; check-in; and reservation.
“Any improvements in customer satisfaction are being offset by passenger displeasure with cutbacks on in-flight amenities, increases in fees and attitudes of flight crews,â says Dale Haines, senior director of the travel practice at J.D. Power and Associates, in a statement.
We have taken J D Powers data and with additional commentary combined results from the latest survey to present a complete picture of airline performance across the sector, ranked in terms of the customers importance.
Observations
J D Powers separates the report into two – traditional carriers and low cost airlines. We think that distinction is no longer as relevant to the customer experience as, for instance ‘low cost carrier’ Jet Blue offer a fully and complete range of services, on a par if not better than most regarded as ‘traditional’.
In fact ‘traditional’ service is a poor cousin of much of the ‘low cost carriers’. Also the distinction of traditional carriers having multicabin is lost on the vast majority of travelers, as for instance several carriers only additional facility in a higher class is to offer a ‘free’ drink and newspaper. Much has been said about the failure of tradtional carriers to effectively manage the customer expectation with feedback such as this experience is not unusual (thanks to Vicky Cartwright, e2e Technologies Ltd; Broadcast Media Consultant).
It is reassuring to see the data represented as the customer experience, rather than a set of activities. This distinction should be applied to all consumer surveys, measuring as it does the customers view of the process.
Additional steps could be taken to extend the scope of the actual survey to include the total customer experience, for instance the airport services and facilities, the transportation systems, the ease of access and egress from the airports. That actual customer experience is a big part of the consumer decision making process of which airline to fly.
Infact more progressive airlines now consider that complete customer experience as their process, and while they can’t own every aspect of it they can partner and control it. For instance Southwest’s partnering with various hotel chains to provide a unified check-out/check-in service is an improvement to customer service while at the same time reducing Southwests costs and growing future revenues.
As consumers it is the smart thing for airlines to do and changes the customer expectation of others. This lifting of the bar places further pressure on the inside-out carriers who continue to see a drift of passengers to a complete offering.
These aspects of travel are making their customers lives easier, simpler and more successful.
Here’s the consolidated table combining the results produced by J D Power.
In summary Alaska Airlines ranked highest for a second consecutive year. JetBlue once again performed well, topping the low cost carriers followed closely by Southwest.
It is worth noting that all top five performers are ‘outside-in’** companies.
More on this theme soon!
See the complete J D Power report here.
**New to the distinction of ‘inside-out’ to ‘outside-in’?
Here’s a quick summary provided by BP Group LI Manager, David Mottershead
An outside in process is one which has been created to successfully deliver a customer outcome and has been designed from the customer’s perspective. ��This process is likely to reduce the number of moments of truth or interactions with the organisation and is “doing the right things”, in terms of delivering the process as part of an overall customer success strategy. ��
An inside out process may be thought of as one which also provides the goods or services to the customer, but the process to provide these are viewed from the organisation’s perspective. It may be “doing things right” but not necessarily “doing the right things”. ��It may seek to improve the customer’s experience, but not necessarily aligned with delivering a successful customer outcome, or what the customer really wants.
>David Mottershead, CPP (Certified Process Professional) – Creative Digital Technology (Australia)
I have lifted this from the BP Group Linked-In as it seems very appropriate in terms of Successful Customer Outcomes.
This example tells you much about the demise of many – see http://bit.ly/drVHa – with the quote from CIO Update “A process is a process is a process, whether it is the manufacturing floor or airline passenger check-in. And what worked for manufacturing in Detroit years ago is also working for British Airways.”
(as a matter of fact it isn’t)
This typifies the inside-out thinking which does not acknowledge anywhere near sufficiently the Successful Customer Outcome. It might have worked in the 70’s and 80’s but it just isn’t adequate anymore.
The BP Group and iCMG have a FREE webinar on this theme on Tuesday 2nd June – ‘BPM, Evolving beyond Lean & Six Sigma’ – click this link to join: http://bit.ly/krEnR
We will demonstrate precisely why companies like BA have it wrong, and what you can do immediately to ‘do it right’
A few hours later after this initial post I received a rather terse reply regarding BA in my private mail… which allowed me to follow up as follows:
One of the features of ‘inside-out’ companies is the way people blame others for their ills – even though they were the ones responsible for the mess.
If you need more evidence read this interview from last months Information Age
http://bit.ly/rKs6O which featured their CIO blaming the British Airport Authority (BAA) for the Terminal 5 debacle. All those lost bags, disastrous service, hopeless communications, pitiful systems etc.had nothing to do with the new lean technology (apparently – honestly). No I suppose it was the tooth fairy again eh?Now don’t get me wrong I would love BA to become hugely successful (as I need to fly their routes often) but the first stage of that is sorting out the mindset within. A good start is truly understanding the only reason you have a job is because of the customer. Get that and then make sure everything you do makes the customers lives easier, somper and more successful.
If BA don’t get it together soon then extinction is their final destination.
References:
BP Group – Global not for profit business club with 32,000 members – FREE membership, join at
LinkedIn – BP Group discussions, presentations, toolkits, video, downloads
BP Community blog– Articles
Customer Expectation Management Method (CEMMethodtm)
Business Process Professional – Certified BPM Training
Summer Webinar Series (free to BP Group members)
Contact the author – Steve Towers
web – www.stevetowers.com
linkedin – www.linkedin.com/in/stevetowers
twitter – http://twitter.com/stowers
email – steve.towers @ bpgroup.org
